Table of Contents
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 2, 2006
ViaSat, Inc.
(Exact name of registrant as specified in its charter)
| Delaware | 0-21767 | 33-0174996 | ||
| (State or Other Jurisdiction of Incorporation) |
(Commission File No.) | (I.R.S. Employer Identification No.) |
6155 El Camino Real
Carlsbad, California 92009
Carlsbad, California 92009
(Address of principal executive offices, including zip code)
Registrant’s telephone number, including area code: (760) 476-2200
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy
the filing obligation of the registrant under any of the following provisions (see General
Instruction A.2. below):
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
TABLE OF CONTENTS
| Item 2.02. Results of Operations and Financial Conditions | ||||||||
| Item 9.01. Financial Statements and Exhibits. | ||||||||
| SIGNATURE | ||||||||
| EXHIBIT INDEX | ||||||||
| EXHIBIT 99.1 | ||||||||
Table of Contents
Item 2.02. Results of Operations and Financial Conditions
On November 2, 2006, ViaSat, Inc. issued a press release regarding its financial results for
the second quarter of fiscal year 2007. A copy of the press release is attached hereto as Exhibit
99.1.
The information contained in this Current Report, including the exhibit, is being furnished
and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934,
as amended, or otherwise subject to the liabilities of that section. Such information shall not be
incorporated by reference into any filing of ViaSat, Inc., whether made before or after the date
hereof, regardless of any general incorporation language in such filing.
Item 9.01. Financial Statements and Exhibits.
(c) Exhibits.
| Exhibit | ||
| Number | Description of Exhibit | |
| 99.1 | Press release issued by ViaSat, Inc. on November 2, 2006. |
Table of Contents
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly
caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: November 2, 2006 | VIASAT, INC. | |||||
| By: | /s/ Ronald G. Wangerin | |||||
| Name: Ronald G. Wangerin | ||||||
| Title: Vice President, CFO | ||||||
Table of Contents
EXHIBIT INDEX
| Exhibit | ||
| Number | Description of Exhibit | |
| 99.1 | Press release issued by ViaSat, Inc. on November 2, 2006. |
Exhibit 99.1
| November 2, 2006 |
||
 News
|
Contact: Heather Ferrante ViaSat, Inc. 760-476-2633 www.viasat.com |
ViaSat Reports Fiscal 2007 Second Quarter Results: Record Awards, Revenues and Earnings
Carlsbad, CA — ViaSat Inc. (NASDAQ: VSAT), a producer of innovative satellite and other
wireless communication products that enable fast, secure, and efficient communications to any
location, announced results for its fiscal year 2007 second quarter, including record revenues of
$131.5 million, new net contract awards of $141.4 million, and net income of $0.28 per share on a
diluted non-GAAP basis or $0.21 per share on a diluted GAAP basis. Year-to-date, the company
reported total revenues of $260.2 million, net new contract awards of $275.3 million, and net
income of $0.53 per share on a diluted non-GAAP basis or $0.39 per share on a diluted GAAP basis.
“We are especially pleased with our earnings performance this quarter,” said Mark Dankberg,
chairman and CEO of ViaSat. “We achieved our objectives without the previously expected approval of
R&D tax credit legislation. Overall business remains robust, our commercial business contributed to
earnings, and we continue to see promising growth opportunities.”
Financial Results
For the second quarter ended September 29, 20061, the company reported the
following:
| First 6 Mos. | First 6 Mos. | |||||||||||||||||||||
| (In millions, except per share data) | Q2 2007 | Q2 2006 | FY07 | FY06 | ||||||||||||||||||
Revenues |
$ | 131.5 | $ | 104.1 | $ | 260.2 | $ | 204.1 | ||||||||||||||
Net income |
$ | 6.5 | $ | 6.0 | $ | 11.9 | $ | 11.1 | ||||||||||||||
Diluted per share net income |
$ | 0.21 | $ | 0.21 | $ | 0.39 | $ | 0.39 | ||||||||||||||
Non-GAAP net income 2 |
$ | 8.5 | $ | 6.9 | $ | 16.1 | $ | 12.9 | ||||||||||||||
Diluted per share non-GAAP
net income 2 |
$ | 0.28 | $ | 0.24 | $ | 0.53 | $ | 0.46 | ||||||||||||||
Fully diluted weighted average shares |
30.5 | 28.6 | 30.2 | 28.4 | ||||||||||||||||||
New orders/Contract awards |
$ | 141.4 | $ | 102.8 | $ | 275.3 | $ | 232.2 | ||||||||||||||
Sales backlog |
$ | 395.2 | $ | 389.9 | $ | 395.2 | $ | 389.9 | ||||||||||||||
1 ViaSat uses a 52- or 53-week fiscal year which ends on the Friday closest to
March 31. ViaSat’s quarters for fiscal year 2007 end on June 30, 2006, September 29, 2006,
December 29, 2006 and March 30, 2007.
2 All non-GAAP numbers have been adjusted to exclude the effects of
acquisition charges (amortization of intangible assets), compensation expense from employee
stock options under FAS123(R) and a cumulative one time adjustment to compensation expense
related to review of stock option grant procedures. A reconciliation of specific adjustments to
GAAP results for these periods is included in the “Non-GAAP Condensed Consolidated Statement of
Operations” table contained in this release. A description of our use of non-GAAP information
is provided under “Use of Non-GAAP Financial Information.”
—more—
| ViaSat News | 2 |
Government Segment
The Government segment had quarterly revenues of $70.0 million, a 41.5% increase over the
second quarter of fiscal year 2006. New contract awards for the quarter were $68.2 million. The
revenue growth from second quarter of fiscal year 2006 to second quarter of fiscal year 2007 was
primarily related to tactical data link product sales.
Commercial Segment
Revenues from our Commercial segment were $61.5 million for the second quarter, an 8.1%
increase over the second quarter of fiscal year 2006. New contract awards for the quarter were
$73.2 million. The revenue growth from the second quarter of fiscal year 2006 to second quarter of
fiscal year 2007 was primarily related to consumer broadband sales.
Selected Second Quarter 2007 Business Highlights
| • | Achieved a listing on the Forbes magazine “200 Best Small Companies” for 2006. This is the fifth time the company has made the list which is a compilation of the best “small, but growing, businesses designed to survive the ups and downs of market volatility” in America. | ||
| • | Increased our international Multifunctional Information Distribution System (MIDS) market share by being selected to supply MIDS airborne terminals to the Turkish Air Force for its fleet of F-16 jet fighters. This order is our largest to-date through the Foreign Military Sales (FMS) Program and extends our international MIDS production backlog for several more years. | ||
| • | Received a contract increase in excess of $20 million for additional encryption and security work in support of Boeing’s Family of Beyond Line-of-Sight Terminals (FAB-T) program. | ||
| • | Introduced new products for military tactical networking including the VDC-800, which adds the high-speed, plug-and-play USB interface to our ViaSat Data Controller product line, and VINE Manager software that enables customers using our AltaSec® Inline Network Encryptors to remotely manage, monitor, and configure their secure networks. | ||
| • | Received an additional order from ARINC for airborne broadband communications terminals, which ARINC supplies to business jet manufacturers and aftermarket equipment installers for the SKYLinkSM in-flight broadband service as ARINC announced its sale of the 50th set of SKYLink avionics to launch customer Gulfstream Aerospace. | ||
| • | Shipped over 40,000 SurfBeam® DOCSIS®-based broadband satellite terminals in this quarter. |
—more—
| ViaSat News | 3 |
Safe Harbor Statement
Portions of this release, particularly ViaSat’s financial prospects for fiscal year 2007
and beyond and the “Selected Second Quarter 2007 Business Highlights” section, may contain
forward-looking statements within the meaning of the Private Securities Litigation Reform Act of
1995. ViaSat wishes to caution you that there are some factors that could cause actual results to
differ materially from historical results or from any results expressed or implied by such
forward-looking statements, including but not limited to: product design flaws or defects; ViaSat’s
ability to successfully integrate acquired companies; ViaSat’s ability to perform under existing
contracts and obtain additional contracts; ViaSat’s ability to develop new products that gain
market acceptance; changes in product supply, pricing and customer demand; changes in relationships
with, or the financial condition of, key customers or suppliers; changes in government regulations;
changes in economic conditions globally and in the communications markets in particular; increased
competition; potential product liability, infringement and other claims; and other factors
affecting the communications industry generally. ViaSat refers you to the documents it files from
time to time with the Securities and Exchange Commission, specifically the section titled Risk
Factors in ViaSat’s most recent Form 10-K and Form 10-Qs. These documents contain and identify
other important factors that could cause actual results to differ materially from those contained
in our projections or forward-looking statements. Stockholders and other readers are cautioned not
to place undue reliance on these forward-looking statements, which speak only as of the date on
which they are made. We undertake no obligation to update publicly or revise any forward-looking
statements.
Conference Call
ViaSat Inc. will host a conference call to discuss these fiscal year 2007 second quarter
results at 5:00 PM Eastern Time on Thursday, November 2, 2006. The dial-in number is (866) 831-6270
and (617) 213-8858 internationally. The passcode is 10752815. A replay will be available for 24
hours beginning at 7:30 PM ET November 2 at (888) 286-8010 and (617) 801-6888 internationally. The
passcode is 19489449. You can also access our conference call webcast and other material financial
information discussed on our conference call (including any information required by Regulation G)
on the Investor Relations Events Calendar page of our corporate Web site (www.viasat.com). The call
will be archived and available on that site for at least twelve months immediately following the
conference call.
About ViaSat (www.viasat.com)
ViaSat produces innovative satellite and other communication products that enable fast,
secure, and efficient communications to any location. The Company provides networking products and
managed network services for enterprise IP applications; is a key supplier of network-centric
military communications and encryption technologies to the U.S. government; and is the primary technology partner
—more—
| ViaSat News | 4 |
for gateway and
customer-premises equipment for consumer and mobile satellite broadband services. The company’s
three wholly owned subsidiaries, US Monolithics, Efficient Channel Coding, and Enerdyne
Technologies Inc., design and produce complimentary products such as monolithic microwave
integrated circuits, DVB-S2 satellite communication components, and video data link systems.
ViaSat has locations in Carlsbad, CA, and Duluth, GA, along with its Comsat Laboratories division
in Germantown, MD. Additional field offices are located in Boston, MA, Baltimore, MD, Washington
DC, Australia, China, India, Italy, and Spain.
Use of Non-GAAP Financial Information
Non-GAAP net income excludes the effects of acquisition charges (amortization of
intangible assets), compensation expense from employee stock options under FAS 123(R) and a
cumulative one time adjustment to compensation expense related to review of stock option grant
procedures. Non-GAAP net income is provided to enhance the overall understanding of our current
financial performance and our prospects for the future. Specifically, we believe the non-GAAP
results provide useful information to both management and investors by excluding specific expenses
that we believe are not indicative of our core operating results. In addition, since we have
historically reported non-GAAP results to the investment community, we believe the inclusion of
non-GAAP numbers provides consistency in our financial reporting. Further, these adjusted non-GAAP
results are one of the primary indicators management uses for planning and forecasting in future
periods. The presentation of this additional information should not be considered in isolation or
as a substitute for results prepared in accordance with generally accepted accounting principles.
See the “Non-GAAP Condensed Consolidated Statement of Operations” table for a reconciliation of net
income to non-GAAP net income. Non-GAAP information as presented in this press release may not be
comparable to similarly titled measures reported by other companies.
Comsat Labs and Comsat Laboratories are tradenames of ViaSat Inc. Neither Comsat Labs nor
Comsat Laboratories is affiliated with COMSAT Corporation. “Comsat” is a registered trademark of
COMSAT Corporation.
SKYLink is a service mark of ARINC.
DOCSIS is a registered trademark of Cable Television Laboratories Inc.
—more—
| ViaSat News | 5 |
Condensed Consolidated Statement of Operations
(Unaudited)
(In thousands, except per share data)
(Unaudited)
(In thousands, except per share data)
| Three months ended | Six months ended | |||||||||||||||
| September 29, 2006 | September 30, 2005 | September 29, 2006 | September 30, 2005 | |||||||||||||
Revenues |
$ | 131,501 | $ | 104,112 | $ | 260,202 | $ | 204,089 | ||||||||
Operating expenses: |
||||||||||||||||
Cost of revenues |
97,444 | 78,154 | 195,559 | 153,875 | ||||||||||||
Selling, general & administrative |
16,790 | 13,327 | 32,634 | 26,173 | ||||||||||||
Independent research and development |
4,832 | 3,557 | 9,624 | 6,861 | ||||||||||||
Amortization of intangible assets |
2,621 | 1,512 | 4,681 | 3,024 | ||||||||||||
Income from operations |
9,814 | 7,562 | 17,704 | 14,156 | ||||||||||||
Interest, net |
223 | (26 | ) | 458 | (175 | ) | ||||||||||
Income before income taxes and minority interest |
10,037 | 7,536 | 18,162 | 13,981 | ||||||||||||
Provision for income taxes |
3,475 | 1,629 | 6,171 | 2,895 | ||||||||||||
Minority interest in net earnings (loss) of subsidiary, net of tax |
23 | (46 | ) | 91 | (43 | ) | ||||||||||
Net Income |
$ | 6,539 | $ | 5,953 | $ | 11,900 | $ | 11,129 | ||||||||
Diluted net income per share |
$ | 0.21 | $ | 0.21 | $ | 0.39 | $ | 0.39 | ||||||||
Diluted common equivalent shares |
30,520 | 28,634 | 30,228 | 28,371 | ||||||||||||
Non-GAAP Condensed Consolidated Statement of Operations
(Unaudited)
(In thousands, except per share data)
(Unaudited)
(In thousands, except per share data)
| Three months ended | Six months ended | |||||||||||||||
| September 29, 2006 | September 30, 2005 | September 29, 2006 | September 30, 2005 | |||||||||||||
Revenues |
$ | 131,501 | $ | 104,112 | $ | 260,202 | $ | 204,089 | ||||||||
Operating expenses: |
||||||||||||||||
Cost of revenues |
$ | 97,282 | 78,154 | $ | 194,431 | 153,875 | ||||||||||
Selling, general & administrative |
16,459 | 13,327 | 31,847 | 26,173 | ||||||||||||
Independent research and development |
4,801 | 3,557 | 9,487 | 6,861 | ||||||||||||
Non-GAAP income from operations |
12,959 | 9,074 | 24,437 | 17,180 | ||||||||||||
Interest, net |
223 | (26 | ) | 458 | (175 | ) | ||||||||||
Non-GAAP income before income taxes
and minority interest |
13,182 | 9,048 | 24,895 | 17,005 | ||||||||||||
Provision for income taxes |
4,643 | 2,234 | 8,674 | 4,105 | ||||||||||||
Minority interest in net earnings (loss) of subsidiary, net of tax |
23 | (46 | ) | 91 | (43 | ) | ||||||||||
Non-GAAP net income |
$ | 8,516 | $ | 6,860 | $ | 16,130 | $ | 12,943 | ||||||||
Non-GAAP diluted net income per share |
$ | 0.28 | $ | 0.24 | $ | 0.53 | $ | 0.46 | ||||||||
Diluted common equivalent shares |
30,520 | 28,634 | 30,228 | 28,371 | ||||||||||||
AN ITEMIZED RECONCILIATION BETWEEN NET INCOME
ON A GAAP BASIS AND NON-GAAP BASIS IS AS FOLLOWS: |
||||||||||||||||
GAAP net income |
$ | 6,539 | $ | 5,953 | $ | 11,900 | $ | 11,129 | ||||||||
Amortization of intangible assets |
2,621 | 1,512 | 4,681 | 3,024 | ||||||||||||
Share-based compensation expense: |
||||||||||||||||
Cost of revenues |
162 | — | 1,128 | — | ||||||||||||
Selling, general & administrative |
331 | — | 787 | — | ||||||||||||
Independent research and development |
31 | — | 137 | — | ||||||||||||
Income tax effect |
(1,168 | ) | (605 | ) | (2,503 | ) | (1,210 | ) | ||||||||
Non-GAAP net income |
$ | 8,516 | $ | 6,860 | $ | 16,130 | $ | 12,943 | ||||||||
—more—
| ViaSat News | 6 |
Condensed Consolidated Balance Sheet
(Unaudited)
(In thousands)
(Unaudited)
(In thousands)
| Assets | September 29, 2006 | March 31, 2006 | Liabilities and | September 29, 2006 | March 31, 2006 | |||||||||||||
| Stockholders' Equity | ||||||||||||||||||
Current Assets: |
Current liabilities: | |||||||||||||||||
Cash and S-T investments |
$ | 47,433 | $ | 36,887 | Accounts payable | $ | 52,552 | $ | 50,577 | |||||||||
Accounts receivable, net |
163,874 | 144,715 | Accrued liabilities | 51,463 | 40,969 | |||||||||||||
Inventory |
45,341 | 49,883 | Line of credit | — | — | |||||||||||||
Deferred income taxes |
7,008 | 7,008 | Total current liabilities | 104,015 | 91,546 | |||||||||||||
Other current assets |
11,445 | 5,960 | ||||||||||||||||
Total current assets |
275,101 | 244,453 | Other liabilities | 11,314 | 9,389 | |||||||||||||
Goodwill |
48,855 | 28,133 | Total liabilities | 115,329 | 100,935 | |||||||||||||
Other intangible assets, net |
25,872 | 23,983 | Minority
interest |
928 | 836 | |||||||||||||
Property and equip, net |
49,033 | 46,211 | ||||||||||||||||
Other assets |
16,826 | 22,289 | Total stockholders' equity | 299,430 | 263,298 | |||||||||||||
| $ | 415,687 | $ | 365,069 | $ | 415,687 | $ | 365,069 | |||||||||||