01—Abstract
Summary
Summary of the 10-K filed March 4, 2021. Cited figures are marked; the original filing is the authoritative source.
Globalstar, Inc. reported total revenues of $128.5 milliona for the year ended December 31, 2020, a slight decrease from $131.7 million in 2019.
This was primarily driven by a decline in Duplex and SPOT service revenues, which were impacted by factors such as lower average subscribers and ARPU (Average Revenue Per User), partly due to the COVID-19 pandemic. The company experienced a net loss of $109.6 millionb in 2020, a significant change from a net income of $15.3 million in 2019. This loss was largely influenced by factors including a derivative gain in the prior year and increased depreciation and amortization expenses.
Despite revenue pressures and a net loss, Globalstar is focusing on its strategic initiatives, including the development of its terrestrial spectrum (Band 53) for potential future broadband services, and maintaining its core Mobile Satellite Services (MSS) business with products like SPOT and Commercial IoT. The company ended the year with $13.3 millionc in cash and cash equivalents, and $54.7 million in restricted cash, while managing its significant debt obligations. The company's ability to meet its future obligations and execute its strategy will depend on its ability to generate sufficient cash flow from operations and potentially access additional financing.
02—Key points
Key Highlights
- Total revenue for 2020 was $128.5 million, down from $131.7 million in 2019, primarily due to decreases in Duplex and SPOT service revenues.
- The company reported a net loss of $109.6 million in 2020, a significant decline from a net income of $15.3 million in 2019.
- Service revenue represented 88% of total revenue in 2020, indicating a continued reliance on service-based income.
- Globalstar is actively pursuing the development of its licensed 2.4 GHz spectrum for terrestrial broadband services (Band 53), which has received 3GPP standardization.
- The company continues to manage substantial debt, with total debt obligations of $423.9 million as of December 31, 2020.
- COVID-19 impacted sales of subscriber equipment and the collection of receivables, particularly from customers in the oil and gas industry.
- The company maintained effective internal controls over financial reporting as of December 31, 2020.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2020filed March 4, 2021Financial Statements
FY2020 against FY2019
| Line item | FY2020FY2019 | Change |
|---|---|---|
| Revenue | $128.49M$131.72M | −2.5% |
| R&D Expenses | $1.90M$3.20M | −40.6% |
| SG&A Expenses | $41.74M$45.23M | −7.7% |
| Operating Expenses | $187.65M$195.76M | −4.1% |
| Operating Income | -$59.16M-$64.05M | +7.6% |
| Net Income | -$109.64M$15.32M | −815.5% |
| EPS (Basic) | $-1.05$0.15 | −800.0% |
| EPS (Diluted) | $-1.05$-1.05 | 0.0% |
| Shares Outstanding (Basic) | 109.49M96.72M | +13.2% |
| Shares Outstanding (Diluted) | 109.49M110.35M | −0.8% |
05—Questions
Frequently Asked Questions
What was Globalstar's financial performance in 2020?
In 2020, Globalstar reported total revenues of $128.5 million, a slight decrease from $131.7 million in 2019. The company experienced a net loss of $109.6 million in 2020, a significant downturn compared to a net income of $15.3 million in 2019. This change was influenced by various factors including a derivative gain in the prior year and increased depreciation and amortization.
How did COVID-19 affect Globalstar's business?
COVID-19 had a notable impact on Globalstar's operations. The company observed a reduction in the volume of sales for its subscriber equipment and experienced challenges in collecting outstanding receivables, particularly from customers in the oil and gas and retail sectors. Supply chain disruptions, especially from manufacturers in China, were also a concern.
What is Globalstar's strategy regarding its spectrum holdings?
Globalstar is actively working to leverage its licensed 2.4 GHz spectrum (designated as Band 53 and n53 for 5G) to provide terrestrial broadband services. This initiative involves seeking international approvals and developing an ecosystem of devices and partnerships to support these services, which could offer future growth opportunities.
What is Globalstar's debt situation?
As of December 31, 2020, Globalstar had significant debt obligations totaling $423.9 million, comprising amounts under its First Lien Facility Agreement, Second Lien Facility Agreement, Convertible Senior Notes, and a Payroll Protection Program loan. The company's ability to manage this debt and meet its obligations is a key financial consideration.
06—Continue