GeoEye 4th Quarter and Year-End 2008 results

02 April 2009, 2:40pm

DULLES, Va., 2 April - GeoEye, Inc. today reported its revenues of $40.7 million for the fourth quarter of 2008 and $146.7 million for the year ended December 31, 2008. Revenues for the quarter were down $2.9 million, or seven percent, compared to $43.6 million for the fourth quarter 2007 and down $36.3 million, or 20 percent, compared to $183.0 million for the full year 2007. The decreases for the quarter and year are primarily due to a shortfall in imagery orders from the National Geospatial-Intelligence Agency and other customers due to the delay of the launch and checkout of the Company's GeoEye-1 satellite. The fourth quarter decrease was partially offset by increased revenue from the sale of ground station upgrades of $7.2 million. The Company's GeoEye-1 satellite completed its checkout and was certified by the National Geospatial-Intelligence Agency on February 20, 2009.

"Last year was obviously disappointing," said the Company's Chief Executive Officer, Matt O'Connell. "We're gratified that GeoEye-1 was certified by our biggest customer, the National Geospatial-Intelligence Agency, in February so that we can finally begin operations under our Service Level Agreement with them and begin serving our international and commercial customers."

Earnings from operations were $3.7 million for the fourth quarter 2008 and $22.8 million for the full year 2008. Earnings from operations for the quarter were down $12.3 million, or 77 percent compared to $16.0 million for the fourth quarter 2007. For the full year 2008, earnings from operations were down $56.4 million, or 71 percent, compared to $79.2 million in 2007. The declines for the quarter and the year were due primarily to the previously discussed revenue shortfall, an increase in direct costs and increased SG&A due to additional staff to support the ramp-up of GeoEye-1 as well as increased professional fees as a result of restatements of our financial statements during 2008. In addition, we recognized $3.3 million losses due to inventory impairment and satellite impairment settlement.

Our net loss for the fourth quarter of 2008 was $3.6 million compared to net earnings of $7.0 million for the corresponding period in 2007. Net earnings for 2008 were $26.6 million, compared to $28.5 million for 2007. Net earnings for 2008 include a net $25.5-million income-tax benefit resulting from the reversal of charges recorded in 2007. This change results from the reversal of the accrued tax penalties and interest for the cost-share payments under the NextView program with the National Geospatial-Intelligence Agency.

Our cash and short-term investments balance was $110.5 million at December 31, 2008, as compared to $234.3 million at December 31, 2007. The decrease from the 2007 cash balance primarily reflects payments made to complete our GeoEye-1 program and income taxes paid related to the GeoEye-1 cost-share payments.

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