KVH reports record profits

MIDDLETOWN, R.I. – Diversification seems to be working for KVH Industries, Inc. (Nasdaq: KVHI), a manufacturer of systems to provide mobile access to satellite TV, communication, and high-speed Internet, as well as navigation, pointing, and guidance solutions for defense and commercial applications.

The company reported only a slight decline in revenue and a record net profit during the second quarter ended June 30, despite softness in the leisure marine and RV markets. This was due largely to increases in its military and commercial businesses.

KVH Industries’ revenue for the second quarter of 2008 was $22.3 million, down 4 percent from the second quarter ended June 30, 2007. Net income for the quarter was a record $2.0 million. During the same period last year the company reported net income of $1.5 million.

For the six months ended June 30, revenue increased 4 percent to $45.4 million from $43.6 million for the six months ended June 30, 2007. KVH reported net income of $3.6 million for the 2008 period, versus net income of $1.6 million in the year-ago period.

"Despite challenging economic conditions, we achieved solid top line results and earned record profits during the second quarter as our long-term strategic growth drivers began to hit their stride," said Martin Kits van Heyningen, KVH's chief executive officer.

In the second quarter of 2008, mobile communications revenue was $18.3 million, up 4 percent on a year-over-year basis, the company reported in a statement.

"Marine revenue rose 22 percent over the same quarter last year, driven by increasing demand for Internet access and satellite communications. Shipments of our TracPhone satellite communication systems, especially the TracPhone V7, were quite strong," Kits van Heyningen continued. "We are accelerating our planned global rollout of the mini-VSAT Broadband service through our recently announced agreement with ViaSat, Inc. The proposed expansion of the mini-VSAT broadband coverage area will enable us to offer broadband connections to a growing market of commercial, leisure, and government vessels worldwide and open new opportunities to build our airtime service revenue.”

"Looking forward, we expect to see continued strong year-over-year growth in our TracPhone satellite communications and airtime business at a rate similar to what we saw in the first half of the year,” said Patrick Spratt, KVH's chief financial officer. “This should offset continued low demand in the land mobile business due to the distress of the RV market as well as softness in the leisure marine satellite TV business.”

He added, however, that due to "challenging economic conditions and their affect on the leisure land and marine markets,” the company is taking a cautious outlook for the remainder of 2008.

  • For more of the latest news, click here.

Leave a Reply

Your email address will not be published. Required fields are marked *