Globalstar, a Covington satellite phone company, said its first-quarter revenue topped $19.3 million, a 16 percent increase from the year before.
Globalstar posted a net loss for the quarter, but its earnings before interest, taxes, depreciation and amortization was $2.5 million, an 80 percent increase over the $1.4 million EBITDA in 2012. Company officials say EBITDA is the measuring stick satellite phone companies use, because they are severely affected by depreciation of their equipment.
The net loss was $25.1 million for the quarter, up from the $24.5 million loss it had in the first quarter of 2012. The company said the difference was caused by higher depreciation expenses, because it put six more satellites in orbit during the quarter.
“We think we turned a corner,” said Jay Monroe, Globalstar’s chairman and CEO. “Our revenue is up substantially when viewed against the quarter a year ago.”
Globalstar has seen a nearly 17 percent increase in minutes of use during the 12-month period ending March 30 when compared with the same period ending March 30, 2012, Monroe said. The key to the increased activity and profitability has been the near-completion of the company’s new satellite network.
The final satellites are being put into place, and Monroe said in the next two weeks the communications network should “feel 100 percent functional to users.”
The company said it has gotten initial approval with a bank group and regulators for a debt exchange arrangement. Noteholders had a right to surrender their securities and claim nearly $70.7 million under an earlier agreement, but Globalstar didn’t have the money to pay the holders. Negotiations had been ongoing and Monroe said an agreement should be in place “in the next week or so.”
Shares of Globalstar were up 1 cent to 34 cents in Thursday’s trading.