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GeoEye Reports Record 2009 Second Quarter Results

DULLES, Va., Aug. 10 /PRNewswire-FirstCall/ -- GeoEye, Inc. (NASDAQ: GEOY), a premier provider of satellite, aerial and geospatial information, announced today results for its fiscal second quarter ended June 30, 2009.

(Logo: http://www.newscom.com/cgi-bin/prnh/20080625/LAW528LOGO)

SECOND QUARTER RESULTS

Total revenues were $72.7 million for the second quarter of 2009, a 112 percent increase from $34.2 million for the second quarter of 2008. Net income for the second quarter of 2009 was $9.6 million, or $0.46 per fully diluted share, compared to a net loss of $558,000, or ($0.03) per fully diluted share, for the second quarter of 2008.

Revenues related to contracts with the U.S. Government, the Company's largest customer, were $47.5 million for the second quarter of 2009, representing 65.3 percent of total revenues for the period. Domestic revenues were $50.4 million for the second quarter of 2009, which were 69.4 percent of total revenues for the period. International revenues were $22.3 million for the second quarter of 2009, which were 30.6 percent of total revenues for the period. Domestic revenues increased 173.3 percent for the second quarter of 2009 compared to the same period in 2008, and international revenues increased 41.2 percent for the second quarter of 2009 compared to the same period in 2008.

Operating profit for the second quarter of 2009 increased $18.8 million from the second quarter of 2008 to $23.9 million. Operating margin was 32.8 percent for the second quarter of 2009 compared to 14.9 percent in the same period in 2008. Adjusted EBITDA, a non-GAAP measurement defined as net income before interest, taxes, depreciation, amortization, and non-cash recognition of stock compensation expense, increased approximately $31.6 million to approximately $40.5 million for the second quarter of 2009 from $8.8 million the same period in 2008. Adjusted EBITDA margin was 55.6 percent for the second quarter of 2009 compared to 25.7 percent for the same period in 2008.

The Company ended the second quarter of 2009 with unrestricted cash and cash equivalents of $47.8 million, total assets of $785.3 million, stockholders' equity of $241.0 million, and long-term debt of $247.9 million.

SIX-MONTH RESULTS

Total revenues for the six months ended June 30, 2009 were $117.9 million, a 68.1 percent increase from $70.1 million in the six months ended June 30, 2008. The Company's Adjusted EBITDA for the six-month period ended June 30, 2009 was $51.0 million, an increase of 179.5 percent from the same period in 2008. Net income for the six months ended June 30, 2009 was $7.8 million, or $0.38 per fully diluted share, as compared to a loss of $1.4 million, or ($0.08) per fully diluted share, in the same period of 2008.

FISCAL YEAR 2009 FINANCIAL OUTLOOK

Matt O'Connell, Chief Executive Officer and President, commented, "We are very pleased with the strong year-over-year revenue growth and operating performance in the second quarter. The operating success and financial results of the second quarter are due in large part because we are finally reaping the benefits of GeoEye-1, the world's best commercial imaging satellite.

"The GeoEye-1 satellite, the world's highest-resolution and highest-accuracy commercial imagery satellite, started commercial operations in February 2009. We achieved a significant ramp in revenues from our NGA contract in the second quarter, which was attributable to GeoEye-1's operating capabilities. We are pleased with the strong fundamentals of our business, and we believe we are strategically positioned for further expansion in both the government and commercial markets. We believe our solid financial position and strong operating cash flow will allow us to continue to invest for future growth.

"With the healthy mix of U.S. Government agency and commercial contracts, and the increasing growth of our international business, we believe we have strong visibility into the second half of 2009. GeoEye currently expects fiscal 2009 revenue to be between $270 million to $280 million, with adjusted EBITDA in the range of $125 million to $133 million, and EPS in a range of $1.10 per share to $1.37 per share. These estimates represent management's current expectations about the Company's future financial performance, based on information available at this time."

CONFERENCE CALL INFORMATION

GeoEye Inc. (NASDAQ: GEOY), will host a conference call for investors and analysts to discuss financial results for the second quarter ended June 30, 2009.

When: Aug. 11, 2009 at 8:30 a.m. EDT

To Participate: At least 10 minutes prior to the conference call, please dial (877) 675-4752 for U.S. domestic calls. For international calls please dial (719) 325-4906. Participants are encouraged to listen via Webcast, which will be broadcast live at www.geoeye.com.

Replay: A replay of the teleconference will be available starting at 10:30 a.m. EDT, Aug. 11, 2009 and will run until midnight EDT on Wednesday, Aug. 19. To access the replay, please dial (888)-203-1112, access code 5602409.


    Selected financial results for the Company are as follows (dollars in
    thousands, except earnings per share):



            UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

                                           Three Months Ended
                                   6/30/09      6/30/08       Change
                                   -------      -------       ------

    Revenues                       $72,701      $34,219      $38,482

    Operating expenses:
      Direct costs of revenue
       (exclusive of depreciation
       and amortization)            22,808       17,319        5,489
      Depreciation and
       amortization                 15,936       3,196        12,740
      Selling, general and
       administrative               10,098       8,605         1,493
      Satellite impairment
       settlement                        -          (9)            9
                                       ---         ---           ---
      Total operating expenses      48,842      29,111        19,731
                                    ------      ------        ------
    Income from operations          23,859       5,108        18,751
    Interest expense, net            8,618       2,030         6,588
                                     -----       -----         -----
    Income before provision for
     income taxes                   15,241       3,078        12,163
    Provision for income taxes       5,689       3,636         2,053
                                     -----       -----         -----
    Net income (loss)               $9,552       $(558)      $10,110
                                    ======       =====       =======
    Earnings (loss) per share
     basic                           $0.52      $(0.03)        $0.55
                                     =====      ======         =====
    Earnings (loss) per share
     diluted                         $0.46      $(0.03)        $0.49
                                     =====      ======         =====


                                             Six Months Ended
                                   6/30/09      6/30/08       Change
                                   -------      -------       ------

    Revenues                      $117,912      $70,131      $47,781

    Operating expenses:
      Direct costs of revenue
       (exclusive of depreciation
       and amortization)            46,400       35,219       11,181
      Depreciation and
       amortization                 24,396        6,469       17,927
      Selling, general and
       administrative               21,552       16,570        4,982
      Satellite impairment
       settlement                        -        1,141       (1,141)
                                       ---        -----       ------
      Total operating expenses      92,348       59,399       32,949
                                    ------       ------       ------
    Income from operations          25,564       10,732       14,832
    Interest expense, net           14,180        5,758        8,422
                                    ------        -----        -----
    Income before provision for
     income taxes                   11,384        4,974        6,410
    Provision for income taxes       3,569        6,350       (2,781)
                                     -----        -----       ------
    Net income (loss)               $7,815      $(1,376)      $9,191
                                    ======      =======       ======
    Earnings (loss) per share
     basic                           $0.42       $(0.08)       $0.50
                                     =====       ======        =====
    Earnings (loss) per share
     diluted                         $0.38       $(0.08)       $0.46
                                     =====       ======        =====

               RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA

                                              For the Three     For the Six
                                               Months Ended     Months Ended
                                                 June 30,        June 30,
                                              -------------    -------------
                                                2009   2008     2009    2008
                                                ----   ----     ----    ----
                                               (Unaudited)      (Unaudited)

      Net income (loss)                       $9,552  $(558)  $7,815 $(1,376)
      Adjustments:
        Interest expense, net                  8,618  2,030   14,180   5,758
        Provision for income taxes             5,689  3,636    3,569   6,350
        Depreciation and amortization         15,936  3,196   24,396   6,469
        Non-cash stock-based compensation
         expense                                 657    501    1,029   1,043
                                                 ---    ---    -----   -----
      Adjusted EBITDA                        $40,452 $8,805  $50,989 $18,244
                                             ======= ======  ======= =======

                     CONDENSED CONSOLIDATED BALANCE SHEETS

                                          June 30,    December 31,
                                             2009         2008    Change
                                             ----         ----    ------
                                         (unaudited)

                                 ASSETS

      Current assets:
        Cash and cash equivalents         $47,755      $106,733 $(58,978)
        Short-term investments                  -         3,813   (3,813)
        Accounts receivable -
         trade and unbilled
         receivables (net of
         allowances: 2009 -$1,048;
         2008 -$738)                       52,996        26,851   26,145
        Income tax receivable              16,050        20,142   (4,092)
        Restricted cash                     4,473             -    4,473
        Other current assets               15,293        34,325  (19,032)
                                           ------        ------  -------
          Total current assets            136,567       191,864  (55,297)
      Property, plant and
       equipment, net                      25,956        22,748    3,208
      Satellites and related
       ground systems, net                517,648       488,145   29,503
      Goodwill                             34,264        34,264        -
      Intangible assets, net               13,006        14,335   (1,329)
      Restricted cash                      15,628             -   15,628
      Other non-current assets             11,974        12,978   (1,004)
      Deferred tax asset                   30,271        30,271        -
                                           ------        ------      ---
          Total assets                   $785,314      $794,605  $(9,291)
                                         ========      ========  =======
               LIABILITIES AND
             STOCKHOLDERS' EQUITY

      Current liabilities:
        Accounts payable and
         accrued expenses                 $41,962       $69,763 $(27,801)
        Current portion of deferred
         revenue                           56,264        40,629   15,635
        Current deferred tax
         liability                          5,594         5,594        -
                                            -----         -----      ---
          Total current liabilities       103,820       115,986  (12,166)
      Long-term debt                      247,859       247,502      357
      Long-term deferred revenue,
       net of current portion             191,959       199,317   (7,358)
      Non-current income tax
       reserve                                688         1,396     (708)
                                              ---         -----     ----
          Total liabilities               544,326       564,201  (19,875)
                                          -------       -------  -------
      Commitments and contingencies             -             -        -
      Stockholders' equity:
        Preferred stock                         -             -        -
        Common stock                          186           184        2
        Additional paid-in capital        213,280       210,513    2,767
        Retained earnings                  27,522        19,707    7,815
                                           ------        ------    -----
          Total stockholders' equity      240,988       230,404   10,584
                                          -------       -------   ------
          Total liabilities and
           stockholders' equity          $785,314      $794,605  $(9,291)
                                         ========      ========  =======


               UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                                   Six Months Ended
                                      June 30,
                                 ------------------
                                 2009          2008        Change
                                 ----          ----        ------
    Net cash (used in)
     provided by operating
     activities                $(11,301)     $36,027     $(47,328)
    Net cash used in
     investing activities       (49,525)     (46,179)      (3,346)
    Net cash provided by
     financing activities         1,848        1,075          773
    Net decrease in cash and
     cash equivalents           (58,978)      (9,077)     (49,901)
    Cash and cash equivalents,
     beginning of period        106,733      226,761     (120,028)
                                -------      -------     --------
    Cash and cash
     equivalents, end of
     period                     $47,755     $217,684    $(169,929)
                                =======     ========    =========



ABOUT GEOEYE

GeoEye, Inc. is an international technology company serving government and commercial markets. The Company is recognized as one of the geospatial industry's imagery experts, delivering exceptional quality imagery products and solutions to customers around the world. Headquartered in Dulles, Virginia, the Company has 534 employees, as of June 30, 2009, dedicated to developing best-in-class geospatial, communications and information products, systems, and services. The Company provides support to academic institutions and non-governmental organizations through the GeoEye Foundation ( http://www.geoeyefoundation.org). GeoEye is a public company listed on the NASDAQ stock exchange under the symbol GEOY. Additional information about GeoEye is available at www.geoeye.com.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

This release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Without limitation, the words "anticipates," "believes," "estimates," "expects," "intends," "plans," "will," and similar expressions are intended to identify forward-looking statements. All statements that address operating performance, events or developments that we expect or anticipate will occur in the future, including statements relating to growth, expected levels of expenditures, and statements expressing general optimism about future operating results, are forward-looking statements. Similarly, statements that describe our business strategy, outlook, objectives, plans, intentions, or goals also are forward-looking statements. All such forward-looking statements and those presented elsewhere by our management from time to time are subject to certain risks and uncertainties that could cause actual results to differ materially from those in forward-looking statements. These risks and uncertainties include, but are not limited to, those described in "Risk Factors" included in our Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2008, which we filed with the Securities and Exchange Commission ("SEC") on April 2, 2009, and our Quarterly Report on Form 10-Q for the period ended March 31, 2009 and June 30, 2009, which we filed with the SEC on May 12, 2009 and Aug. 10, 2009, respectively. A copy of all SEC filings may be obtained from the SEC's EDGAR web site, http://www.sec.gov/, or by contacting: William L. Warren, Senior Vice President, General Counsel and Secretary, at 703-480-5672.

SOURCE GeoEye, Inc.

Web site: http://www.geoeye.com/