MIDDLETOWN, R.I. – KVH Industries, Inc.’s (Nasdaq: KVHI) financial results for the third quarter ended September 30 included an increase in marine revenues, the company reported in a recent statement.
"Solid international business helped drive our marine sales up 5 percent over the same quarter last year," said Martin Kits van Heyningen, KVH's chief executive officer.
Overall revenue for the third quarter of 2007 was $17.6 million, down 9 percent from the third quarter ended September 30, 2006. On a per-diluted share basis, earnings were $0.00. During the same period last year the company reported net income of $0.6 million, or $0.04 on a per-diluted share basis.
For the nine months ended September 30, total revenue was $61.2 million, compared to $61.5 million in the nine months ended September 30, 2006. KVH reported net income of $1.5 million or $0.10 on a per-diluted share basis for the 2007 period, versus net income of $3.6 million or $0.24 on a per-diluted share basis in the year-ago period.
"Overall, our net results exceeded our expectations for what we knew would be a challenging quarter. Despite the previously announced delays in defense-related orders, strong operational performance allowed us to beat our bottom line expectations despite lower revenue," said Kits van Heyningen.
In the third quarter of 2007, mobile communications revenue was $13.0 million, up 1% on a year-over-year basis.
"Within our mobile communications business, the initial reception to our TracPhone V7 and mini-VSAT Broadband service in the marine industry has been very positive and we achieved our third quarter bookings goal,” added Kits van Heyningen. “Production of the TracPhone V7 started in late September and initial shipments to customers began during the first week of October. As a result, we did not see any hardware or airtime service revenue from this product during the third quarter. Service is now live in the United States, Caribbean, and South America and our coverage of the North Atlantic and Europe is expected to come on line next. In addition, we are actively working on expanding future service coverage into the Pacific Ocean and Asian regions. I believe the TracPhone V7 is one of the most important products we've introduced in quite some time. It is a breakthrough high-speed Internet product for the leisure market that also enables us to enter the commercial shipping market for the first time."
Patrick Spratt, KVH's chief financial officer, said, "Looking forward to the fourth quarter, we expect a return to positive top line growth compared to the prior year, primarily driven by solid growth in mobile communications sales, especially in our maritime markets. The fourth quarter will also be our first quarter of TracPhone V7 shipments, although we may be somewhat volume constrained by our modem supplier as production ramps during the quarter. We do not anticipate any sales in the fourth quarter related to stabilized remote weapon programs. Given this visibility, we expect that the revenue for the fourth quarter to be approximately $19 million and earnings to be approximately $0.04 per share vs. $17.4 million and $0.01 per share in the fourth quarter of 2006."
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