KVH Industries(KVHI)

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KVH Industries(KVHI) - 2019 Q2 - Earnings Call Transcript
2019-08-04 12:46
KVH Industries, Inc. (NASDAQ:KVHI) Q2 2019 Earnings Conference Call August 2, 2019 9:00 AM ET Company Participants Donald Reilly - CFO Martin Kits Van Heyningen - Co-Founder, Chairman, CEO & President Conference Call Participants Richard Prentiss - Raymond James & Associates Roger Boyd - Needham & Company James McIlree - Chardan Capital Markets Christopher Quilty - Quilty Analytics Operator Good day, and welcome to the KVH Industries, Inc. Second Quarter 2019 Earnings Conference Call. Today's conference is ...
KVH Industries(KVHI) - 2019 Q2 - Quarterly Report
2019-08-02 20:09
UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: June 30, 2019 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 0-28082 KVH Industries, Inc. (Exact Name of Registrant as Specified in its Charter) Delaware 05-0420589 (State or Other Jurisdiction ...
KVH Industries(KVHI) - 2019 Q1 - Earnings Call Transcript
2019-05-06 01:17
Financial Data and Key Metrics Changes - Q1 revenue remained relatively flat at $40 million compared to $40.1 million in Q1 2018 [7][25] - Gross profit margin decreased to 38.6% from 43.3% in the same quarter last year [29] - Net loss for Q1 was $6.2 million compared to a net loss of $3.9 million in the same period last year [30] - Non-GAAP EPS loss for the quarter was $0.17 per share compared to a non-GAAP EPS loss of $0.06 per diluted share last year [31] Business Line Data and Key Metrics Changes - Mobile Connectivity segment saw airtime revenue grow by 11% or $1.8 million compared to Q1 2018, driven by a 14% increase in total subscribers [9][28] - Inertial Navigation segment's fiber optic gyro sales were $300,000 below Q1 of last year and over $2 million below plan for the quarter [19] - Product revenue for the first quarter was approximately $13 million, a decrease of about $1 million or 8% from the prior year [26] Market Data and Key Metrics Changes - AgilePlans revenue increased 14% sequentially over Q4 2018 and more than 500% from a year earlier [10] - Total backlog at the end of Q1 was $18.2 million, with approximately $13.7 million scheduled for delivery during 2019 [31][32] - The company shipped its 9,000th VSAT system this quarter, setting a new record for first quarter shipments [9] Company Strategy and Development Direction - The company aims to accelerate subscriber growth on its HTS network and push into the maritime IoT market with a new subscription service [8] - Plans to commercialize photonic chip-based fiber optic gyros by the end of the year [8][20] - The company is focusing on maintaining momentum in military A-PNT programs and expanding its service capabilities [8][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in returning to growth in the FOG business in Q2 and the second half of the year, despite short-term challenges [24][41] - The company anticipates making announcements regarding a major new maritime industry partner for IoT capabilities in early June [18] - Management noted that the loss of the IS-29 satellite was managed effectively, ensuring continuity of service for customers [16][47] Other Important Information - Capital expenditures for 2019 are expected to be in the range of $15 million to $20 million [34] - The company has established favorable service agreements with satellite provider partners to manage costs and add predictability [13] Q&A Session Summary Question: What caused the guidance miss in Q1? - Management indicated that the majority of the miss was due to a military drone order that was received but not shipped [36] Question: What is the visibility on future revenues? - Management noted that while there are many moving parts, they have a solid subscriber base and strong backlog, particularly in FOG products [38][41] Question: What are the typical plans and ARPUs for AgilePlans? - Management stated that AgilePlans ARPUs are slightly above typical ARPUs, with average ARPUs in the $1,200 to $1,300 range [44][45] Question: How did the Intelsat satellite failure affect the company? - Management reported no significant changes to revenue or cost streams due to the Intelsat issue, as they had planned for additional satellite capacity [46][48] Question: What is the status of TACNAV programs? - Management mentioned a new international order for TACNAV 3D and expected a pickup in the AMPV program in Q4 2019 [57][58] Question: What is the outlook for the leisure marine market? - Management indicated that Q2 is typically a strong quarter for leisure marine, and they expect some sales to be pushed into Q2 due to a cold spring [74]
KVH Industries(KVHI) - 2019 Q1 - Quarterly Report
2019-05-02 20:54
[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [ITEM 1. FINANCIAL STATEMENTS](index=3&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) KVH Industries reported a Q1 2019 net loss of $6.2 million, with total assets increasing to $197.5 million, primarily due to ASC 842 adoption [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) Total assets increased to **$197.5 million** from $187.7 million, driven by a **$9.4 million** right-of-use asset from ASC 842 adoption Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2019 | December 31, 2018 | | :--- | :--- | :--- | | **Total Assets** | **$197,509** | **$187,652** | | Cash and cash equivalents | $14,259 | $18,050 | | Inventories | $26,062 | $22,942 | | Right of use asset operating lease | $9,411 | $— | | **Total Liabilities** | **$101,911** | **$88,137** | | Total current liabilities | $65,357 | $56,010 | | Long-term debt, excluding current portion | $18,749 | $19,437 | | **Total Stockholders' Equity** | **$95,598** | **$99,515** | [Consolidated Statements of Operations](index=5&type=section&id=Consolidated%20Statements%20of%20Operations) KVH reported a Q1 2019 net loss of **$6.2 million**, up from $3.9 million in Q1 2018, with flat net sales but increased total costs Q1 Statement of Operations Summary (in thousands, except per share data) | Metric | Q1 2019 | Q1 2018 | | :--- | :--- | :--- | | Net Sales | $39,972 | $40,101 | | - Product Sales | $12,874 | $13,992 | | - Service Sales | $27,098 | $26,109 | | Loss from Operations | $(5,829) | $(3,180) | | **Net Loss** | **$(6,179)** | **$(3,893)** | | **Net Loss per Share (Basic & Diluted)** | **$(0.36)** | **$(0.23)** | [Consolidated Statements of Comprehensive Loss](index=6&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Loss) Total comprehensive loss for Q1 2019 was **$5.1 million**, including a **$6.2 million** net loss, partially offset by foreign currency translation adjustments Comprehensive Loss Breakdown (in thousands) | Component | Q1 2019 | Q1 2018 | | :--- | :--- | :--- | | Net Loss | $(6,179) | $(3,893) | | Other Comprehensive Income, net of tax | $1,088 | $2,467 | | **Total Comprehensive Loss** | **$(5,091)** | **$(1,426)** | [Consolidated Statements of Stockholders' Equity](index=7&type=section&id=Consolidated%20Statements%20of%20Stockholders'%20Equity) Stockholders' equity decreased from **$99.5 million** to **$95.6 million** in Q1 2019, primarily due to the net loss, partially offset by other comprehensive income - The primary drivers for the change in stockholders' equity during Q1 2019 were the **net loss of $(6,179) thousand** and **other comprehensive income of $1,088 thousand**[19](index=19&type=chunk) [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities was **$1.1 million** in Q1 2019, with cash and cash equivalents decreasing by **$3.8 million** to **$14.3 million** Cash Flow Summary (in thousands) | Cash Flow Activity | Q1 2019 | Q1 2018 | | :--- | :--- | :--- | | Net cash used in operating activities | $(1,074) | $(1,197) | | Net cash (used in) provided by investing activities | $(3,052) | $1,798 | | Net cash provided by financing activities | $131 | $1,524 | | **Net (decrease) increase in cash** | **$(3,791)** | **$3,172** | | **Cash and cash equivalents at end of period** | **$14,259** | **$37,768** | [Notes to Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail business segments, accounting policies including ASC 842 adoption, debt, and revenue recognition for mobile connectivity and inertial navigation - The company operates in two reporting segments: mobile connectivity and inertial navigation[26](index=26&type=chunk) - A significant accounting policy change was the adoption of ASC 842, Leases, effective January 1, 2019, which resulted in the recognition of right-of-use assets and lease liabilities for operating leases on the balance sheet[33](index=33&type=chunk)[104](index=104&type=chunk) - The company's AgilePlans subscription model provides hardware, installation, and services for a monthly fee, with KVH retaining hardware ownership recorded as a revenue-generating asset[25](index=25&type=chunk) [ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](index=27&type=section&id=ITEM%202.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Management discusses Q1 2019 flat net sales of **$40.0 million**, a widened net loss of **$6.2 million** due to higher service costs, and **$14.3 million** in cash Q1 2019 vs Q1 2018 Performance Summary (in thousands) | Metric | Q1 2019 | Q1 2018 | | :--- | :--- | :--- | | Net Sales | $39,972 | $40,101 | | Costs of Sales | $24,550 | $22,739 | | Loss from Operations | $(5,829) | $(3,180) | | Net Loss | $(6,179) | $(3,893) | - The increase in net loss was primarily driven by a **$2.9 million (21%) increase in costs of service sales**, related to mini-VSAT airtime costs, HTS network capacity, and AgilePlans depreciation[130](index=130&type=chunk) - Service sales grew to **68% of consolidated net sales** in Q1 2019, up from 65% in Q1 2018, reflecting a shift in business mix[113](index=113&type=chunk) [Results of Operations](index=30&type=section&id=Results%20of%20Operations) Q1 2019 net sales were flat at **$39.97 million**, with product sales down 8% and service sales up 4%, while costs of service sales increased 21% Sales Breakdown (in millions) | Sales Type | Q1 2019 | Q1 2018 | Change | | :--- | :--- | :--- | :--- | | Product Sales | $12.9 | $14.0 | -8% | | Service Sales | $27.1 | $26.1 | +4% | - Costs of service sales increased by **$2.9 million (21%)**, primarily due to a **$2.7 million increase in mini-VSAT airtime costs**, including HTS network capacity and AgilePlans depreciation[130](index=130&type=chunk) - Research and development expense remained flat at **$3.9 million** for both quarters[132](index=132&type=chunk) [Segment Discussion](index=32&type=section&id=Segment%20Discussion) Mobile Connectivity sales slightly decreased, swinging to a **$1.0 million** operating loss, while Inertial Navigation sales and operating income modestly increased Segment Performance (in thousands) | Segment | Net Sales Q1 2019 | Net Sales Q1 2018 | Operating (Loss) Income Q1 2019 | Operating Income Q1 2018 | | :--- | :--- | :--- | :--- | :--- | | Mobile Connectivity | $32,510 | $32,749 | $(1,039) | $1,072 | | Inertial Navigation | $7,462 | $7,352 | $443 | $334 | - Mobile connectivity product sales decreased by **$0.8 million**, partly due to the impact of the AgilePlans subscription service where hardware is not sold upfront[141](index=141&type=chunk) - Mini-VSAT service sales increased by **$1.8 million**, driven by a **14% increase in subscribers**, partially offset by a **$1.2 million decrease in content and training service sales**[142](index=142&type=chunk) [Liquidity and Capital Resources](index=34&type=section&id=Liquidity%20and%20Capital%20Resources) KVH held **$14.3 million** in cash, used **$1.1 million** in operations, and had **$21.9 million** outstanding on its term loan as of March 31, 2019 - The company held **$14.3 million** in cash, cash equivalents, and marketable securities as of March 31, 2019[154](index=154&type=chunk) - Net cash used in operations was **$1.1 million** for Q1 2019, compared to $1.2 million in Q1 2018[155](index=155&type=chunk) - As of March 31, 2019, the company had **$21.9 million** outstanding on its 2018 Term Loan and **$5.0 million** outstanding on its 2018 Revolver[64](index=64&type=chunk)[159](index=159&type=chunk) [ITEM 4. CONTROLS AND PROCEDURES](index=37&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) Management concluded that disclosure controls were effective as of March 31, 2019, with no material changes to internal control over financial reporting - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by the report (March 31, 2019)[171](index=171&type=chunk) - There were no material changes to the company's internal control over financial reporting during the first quarter of 2019[172](index=172&type=chunk) [PART II. OTHER INFORMATION](index=38&type=section&id=PART%20II.%20OTHER%20INFORMATION) [ITEM 1. LEGAL PROCEEDINGS](index=38&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) The company is not party to any legal proceedings expected to materially harm its business, financial condition, or results of operations - KVH is not currently a party to any legal proceeding that management believes is likely to have a material adverse effect on the company[176](index=176&type=chunk) [ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS](index=38&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) No common stock was repurchased in Q1 2019, with **341,000 shares** remaining available under the authorized stock buyback program - The company did not repurchase any of its common stock during the three months ended March 31, 2019[178](index=178&type=chunk) - As of March 31, 2019, **341,000 shares** remain available for repurchase under the company's authorized stock buyback program, which has no expiration date[177](index=177&type=chunk) [ITEM 6. EXHIBITS](index=39&type=section&id=ITEM%206.%20EXHIBITS) This section lists filed exhibits, including CEO and CFO certifications and financial data formatted in XBRL - Exhibits filed include CEO and CFO certifications under Rule 13a-14(a)/15d-14(a) and Section 1350, as well as XBRL data files[181](index=181&type=chunk)
KVH Industries(KVHI) - 2018 Q4 - Earnings Call Transcript
2019-03-01 21:04
KVH Industries, Inc. (NASDAQ:KVHI) Q4 2018 Results Conference Call March 1, 2019 9:30 AM ET Company Participants Don Reilly - Chief Financial Officer Martin Kits van Heyningen - Chief Executive Officer Brent Bruun - Chief Operating Officer Conference Call Participants Rick Prentiss - Raymond James Rich Valera - Needham & Company Jim McIlree - Chardan Capital Chris Quilty - Quilty Analytics Operator Good day. And welcome to the KVH Industries Fourth Quarter and Year End 2018 Earnings Conference Call. Today’s ...
KVH Industries(KVHI) - 2018 Q4 - Annual Report
2019-03-01 20:10
Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2018 OR ¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 0-28082 KVH Industries, Inc. (Exact Name of Registrant as Specified in its Charter) Delaware 05-0420589 (State or Other ...