Globalstar, a Covington satellite phone company, posted a second-quarter net loss, but its earnings before interest, taxes, depreciation and amortization was $5 million, a 70 percent increase over the second quarter 2013 EBITDA of $2.9 million.
Revenue in the second quarter was $24 million, up 21 percent from the same period a year ago.
Officials said in the company’s earnings report that EBITDA is the measuring stick satellite phone companies use because they are severely affected by depreciation of their equipment.
The net loss was $433.7 million for the quarter, up from the $126.3 million loss it had in the second quarter of 2013.
The increase was driven almost entirely by noncash items, such as the extinguishment of debt, higher interest and depreciation expenses.
“This quarter’s financial results are the best in many years, and we are pleased to see a material increase in the most critical metrics that drive our business,” said Jay Monroe, Globalstar chairman and CEO. “Globalstar has continued to increase market share and expand its footprint in international markets where we have a competitive advantage across multiple product lines.”
Although Globalstar’s net losses continue to pile up, investors are bullish on the company. The Federal Communications Commission is considering a petition from Globalstar that would allow the company to tap the spectrum set aside for it in areas where satellite phones aren’t needed. Globalstar has said this would increase Wi-Fi capacity in the U.S. by one-third immediately. Numerous technology and communications companies are interested in the spectrum, which could be worth billions.
Monroe said the FCC recently closed the public comment cycle on the Wi-Fi expansion and the FCC should adopt new rules before the end of the year.
Shares of Globalstar were up 17 cents to $3.86 in Monday’s trading.