DigitalGlobe Reports Second Quarter 2012 Results

LONGMONT, CO -- (Marketwire) -- Jul 31, 2012 -- DigitalGlobe, Inc. (NYSE: DGI), a leading global provider of high-resolution earth imagery solutions, today reported financial results for the second quarter ended June 30, 2012.

Second quarter 2012 revenue was $101.8 million, up 23% compared with the same period last year. Net income in the second quarter was $9.6 million, or $0.21 per share, compared with a net loss of $(0.9) million, or $(0.02) per share in second quarter 2011. Second quarter 2012 EBITDA was $47.9 million, delivering an EBITDA margin of 47%, up more than 700 basis points year over year compared with the second quarter 2011 EBITDA margin of 39.9%. This margin expansion occurred despite incurring $2.0 million of non-recurring costs in connection with the recently announced combination with GeoEye.

"Our team delivered an outstanding second quarter," said Jeffrey R. Tarr, President and Chief Executive Officer. "We grew revenue at a strong double-digit rate, expanded margins and raised our guidance. We are excited about our planned business combination with GeoEye and are on track to close the transaction in late 2012 or early 2013. Across the board, we are successfully transforming DigitalGlobe into a high-growth, recurring-revenue geospatial information business."

Second Quarter Business Highlights

  • Defense & Intelligence segment revenue grew 27% to $81.4 million compared with the second quarter of 2011. Performance was driven by increased revenue related to the service level agreement (SLA) portion of EnhancedView and year-over-year growth of $5.5 million from value-added services.
  • Commercial segment revenue grew 10% to $20.4 million in the quarter compared with the prior-year period. Growth was driven primarily by international civil government customers in China and Russia, as well as a full quarter contribution from a large, well-known location-based services customer.
  • The company's 12-month backlog increased to $355.3 million, up 32% year over year, indicative of both broad-based growth and of the company's success in shifting its revenue mix to a more visible recurring model.
  • The company completed, on time, an extensive number of infrastructure upgrades to increase the integration of its infrastructure with the U.S. government to deliver more value for the taxpayer under the EnhancedView contract.
  • International Civil Government growth was enhanced with recently signed agreements with Hunan Land Resources, through its partnership with China Siwei, and in Russia with an expanded relationship with the Federal Forestry Agency, through its partnership with Sovzond.
  • Enhancing growth prospects among customers who provide Location Based Services, the company announced an upsized and expanded relationship with Garmin.
  • Building momentum in the Financial Services vertical, in July, the company announced that Genscape, a pioneer in sophisticated and patented monitoring systems, has signed an agreement to incorporate DigitalGlobe imagery and analysis into their Energy Commodities reporting services worldwide.
  • On July 25, the company announced a new multi-year, multi-million dollar agreement with Esri, a leading provider of GIS software, for delivery of its Global Basemap product.

2012 Outlook
For the full year, the company now expects to report GAAP revenue growth of approximately 16% compared with 2011, an increase from its previous expectation of approximately 14% growth. Including the impact of certain non-recurring expenses related to its planned business combination with GeoEye, the company expects to achieve a full-year EBITDA margin of approximately 46% and to incur capital expenditures of approximately $200 million. Both expectations for EBITDA margin and total capital expenditures are unchanged from prior expectations.

"Our ability to raise revenue guidance for the year while maintaining our EBITDA margin despite incurring significant costs related to our combination with GeoEye is a testament to the strength of our model," said Yancey Spruill, Chief Financial Officer.

Conference Call Information
DigitalGlobe's management will host a conference call today at 5 p.m. EDT to discuss second quarter 2012 results.

The conference call dial-in numbers are as follows:
U.S./Canada dial-in: (866) 394-8778
International dial-in: (706) 679-9623
Passcode: 92336993

A replay of the call will be available through August 31, 2012 at the following numbers:
U.S./Canada dial-in: (855) 859-2056
International dial-in: (404) 537-3406
Passcode: 92336993

DigitalGlobe will also sponsor a live and archived webcast of the conference call on the Investor Relations portion of its website. Click here to directly access the live webcast.

Supplemental earnings materials are available on the company's website at

About DigitalGlobe
DigitalGlobe is a leading global provider of commercial high-resolution earth imagery products and services. Sourced from our own advanced satellite constellation, our imagery solutions support a wide variety of uses within defense and intelligence, civil agencies, mapping and analysis, environmental monitoring, oil and gas exploration, infrastructure management, Internet portals and navigation technology. With our collection sources and comprehensive ImageLibrary (containing more than one billion square kilometers of earth imagery and imagery products) we offer a range of on- and off-line products and services designed to enable customers to easily access and integrate our imagery into their business operations and applications. For more information, visit

DigitalGlobe is a registered trademark of DigitalGlobe, Inc.

Certain statements contained herein and other of our reports, filings, and public announcements may contain or incorporate forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements relate to future events or our future financial performance. We generally identify forward-looking statements by terminology such as "may," "will," "should," "expects," "plans," "anticipates," "could," "intends," "target," "projects," "contemplates," "believes," "estimates," "predicts," "potential" or "continue" or the negative of these terms or other similar words, although not all forward-looking statements contain these words.

Any forward-looking statements are based upon our historical performance and on our current plans, estimates and expectations. The inclusion of this forward-looking information should not be regarded as a representation by us that the future plans, estimates or expectations will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions. A number of important factors could cause our actual results or performance to differ materially from those indicated by such forward looking statements, including: the loss, reduction or change in terms of any of our primary contracts; the availability of government funding for our products and services both domestically and internationally; changes in government and customer priorities and requirements (including cost-cutting initiatives, the potential deferral of awards, terminations or reduction of expenditures to respond to the priorities of congress and the administration, or budgetary cuts resulting from congressional committee recommendations or automatic sequestration under the Budget Control Act of 2011); the risk that the anticipated benefits and synergies from the proposed strategic combination of the Company and GeoEye, Inc. cannot be fully realized or may take longer to realize than expected and the risk that a condition to closing of the proposed strategic combination may not be satisfied; the outcome of pending or threatened litigation; the loss or impairment of our satellites; delays in the construction and launch of WorldView-3; delays in implementation of planned ground system and infrastructure enhancements; loss or damage to the content contained in our ImageLibrary; interruption or failure of our ground system and other infrastructure, decrease in demand for our imagery products and services; increased competition that may reduce our market share or cause us to lower our prices; our failure to obtain or maintain required regulatory approvals and licenses; changes in U.S. foreign law or regulation that may limit our ability to distribute our imagery products and services; the costs associated with being a public company; and other important factors, all as described more fully in our filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K.

We undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events. Readers are cautioned not to place undue reliance on any of these forward-looking statements.

Non-GAAP Financial Measures
EBITDA and Adjusted EBITDA are not recognized terms under generally accepted accounting principles, or GAAP, in the United States and may not be defined similarly by other companies. EBITDA and Adjusted EBITDA should not be considered alternatives to net income, as indications of financial performance, or as alternatives to cash flow from operations as measures of liquidity. There are limitations to using non-GAAP financial measures, including the difficulty associated with comparing companies in different industries that use similar performance measures whose calculations may differ from ours.

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