ORBCOMM Announces Third Quarter 2012 Results

  ORBCOMM Announces Third Quarter 2012 Results

– Service Revenues Increased 23%; Subscribers Increased by 29,000 to 744,000
                                     –

            – Net Income of $2.3 Million or $0.05 per Share –

           – 59% Increase in Adjusted EBITDA to $4.3 Million –

Business Wire

FORT LEE, N.J. -- November 08, 2012

ORBCOMM Inc. (Nasdaq: ORBC), a global satellite data communications company
specializing in two-way Machine-to-Machine (M2M) communications, today
announced financial results for the third quarter ended September 30, 2012.

The following financial highlights are in thousands of dollars, except per
share amounts.

                          Â                      Â Â
                             Three months ended         Nine months ended
                                                        September 30,
                             September 30,
                             2012     Â 2011           2012     Â 2011
Service Revenues             $ 12,708    $ 10,315       $ 36,657    $ 26,692
Product Sales                $ 3,386     $ 3,625        $ 11,635    $ 5,940
Total Revenues               $ 16,094    $ 13,940       $ 48,292    $ 32,632
                                                                    Â
Net Income (loss)
attributable to ORBCOMM      $ 2,307     $ 546          $ 6,562     $ (726   )
Inc. Common Stockholders
Net Income (loss) per        $ 0.05      $ 0.01         $ 0.14      $ (0.02  )
Common Share
EBITDA ^(1,3)                $ 3,887     $ 2,309        $ 11,146    $ 3,921
Adjusted EBITDA ^(2,3)       $ 4,277     $ 2,695        $ 12,508    $ 5,241

^(1) EBITDA is defined as earnings attributable to ORBCOMM Inc. before
interest income (expense), provision for income taxes and depreciation and
amortization.

^(2) Adjusted EBITDA is defined as EBITDA, adjusted for stock-based
compensation expense, loss on disposition of other investment in Alanco, and
noncontrolling interests.

^(3) A table presenting EBITDA and Adjusted EBITDA, reconciled to GAAP Net
Income (Loss), is among other financial tables at the end of this release.

Highlights:

  *For the third quarter of 2012, Service Revenues increased 23%
    year-over-year to $12.7 million and Total Revenues increased 15% to $16.1
    million. Adjusted EBITDA for the period was $4.3 million, up 59% from $2.7
    million during the same three months last year. ORBCOMM reported EPS of
    $0.05 for the third quarter of 2012 compared to EPS of $0.01 for the
    comparable period last year.
  *For the third quarter of 2012, net subscriber additions were 29,000.
    ORBCOMM had 744,000 billable subscriber communicators at September 30,
    2012, compared to 626,000 at the end of the third quarter last year. The
    base of billable subscribers increased 19% year-over-year.
  *inthinc Technology Solutions Inc. (inthinc), a global provider of
    telematics, fleet management and driver safety solutions, selected ORBCOMM
    to provide wireless data services for inthinc’s technology applications
    in the heavy equipment, oil & gas and commercial fleet industries in the
    United States.
  *ORBCOMM Generation 2 (OG2) prototype satellite was launched on October 7,
    2012. The satellite de-orbited as the result of being deployed into a
    lower orbit due to a pre-imposed safety check required by NASA designed to
    protect the International Space Stations and its crew. Although the
    satellite was only available for a short time, we were able to perform
    several critical system verifications that validate that the innovative
    OG2 satellite technology operates as designed before launching the full
    constellation of OG2 satellites. With this verification data, ORBCOMM can
    focus on completing and launching the OG2 satellites as the primary
    mission payloads on two planned Falcon 9 launches, the first in mid-2013
    and the second in 2014, directly into their operational orbit.
  *StarTrak’s ReeferTrak® application was successfully implemented with
    TMW Systems, Inc’s TMWSuite®, providing for-hire carriers and private
    fleets the ability to capture real-time refrigerated trailer operational
    data including trailer temperature, operational condition and GPS
    position.

“Once again, we are pleased to report strong quarterly results,†said Marc
Eisenberg, Chief Executive Officer of ORBCOMM. “Our business fundamentals
are healthy and we continue to execute on our business plan. Our AIS business
has good momentum, reflecting the quality of the data. We continue to add net
subscribers ending the quarter at 744,000 subscribers and have achieved
positive Adjusted EBITDA in fourteen consecutive quarters over the last three
and a half years.â€

“ORBCOMM’s third quarter results reflect strong performance and continued
profitability in our business,†said Robert Costantini, Chief Financial
Officer of ORBCOMM. “Quarterly Service Revenues grew 23% over prior year,
and increased $300,000 sequentially from the second quarter, with the gross
margin on Services expanding to 60%. Adjusted EBITDA grew 59% year-over-year
to $4.3 million and increased sequentially from the second quarter,
demonstrating continued strength in the operating leverage of our business
model.â€

Financial Results and Highlights

Revenues

For the third quarter ended September 30, 2012, Service Revenues were $12.7
million compared to $10.3 million during the same period last year. The
year-over-year increase of 23% was the result of an increase of units in
service, increases in terrestrial ARPU, contribution from acquisitions and
ORBCOMM’s AIS business that contributed $0.7 million to Service Revenues in
the third quarter. ORBCOMM’s gross margin on Service Revenues expanded to
60% for the third quarter compared to 57% in the third quarter last year. For
the nine months ended September 30, 2012, Service Revenues were $36.7 million
compared to $26.7 million during the same period last year, increasing 37%.

Product Sales during the third quarter of 2012 were $3.4 million compared to
$3.6 million during the same period last year. The decrease in Product Sales
was largely due to the timing of purchases by OEM customers in Japan. Gross
margin on Product Sales grew to 31% in the most recent quarter from 27% in the
third quarter of 2011. Product Sales during the first nine months of 2012
increased 96% to $11.6 million from $5.9 million during the first nine months
last year.

Total Revenues for the quarter ended September 30, 2012 were $16.1 million
compared $13.9 million during the quarter ended September 30, 2011, an
increase of 15%. Total Revenues for the nine months ended September 30, 2012
were $48.3 million compared to $32.6 million during the same period of 2011,
an increase of 48%.

Costs and Expenses

Costs and Expenses for the third quarter of 2012 were $13.5 million compared
to $13.0 million during the same period in 2011. Costs and Expenses for the
nine months ended September 30, 2012 were $41.6 million compared to $32.5
million during the same period in 2011. The increases were mostly due to costs
associated with growth in the business, leading to higher Cost of Services,
and expenses related to the operations of the LMS acquisition that were not
present in the prior year period, offset by a reduction in Acquisition-related
costs.

Costs of Product Sales for the third quarter of 2012 were $2.3 million
compared to $2.7 million for the three months ended September 30, 2011, a
decrease of 12% due to lower Product Sales. Costs of Services, Product
Development, and Selling, General and Administrative Expenses were $11.1
million for the third quarter of 2012 compared to $10.0 million in the prior
year third quarter, an increase of $1.1 million primarily related to increased
business activity and the addition of operating expenses for the LMS
acquisition.

Acquisition-related Costs were less than $0.1 million in the third quarter of
2012 and were mostly due to the acquisition of the assets of LMS which closed
in January 2012. Acquisition-related Costs were $0.4 million in the third
quarter of 2011 and were related to the purchase of assets of StarTrak which
closed in May 2011.

Income Before Income Taxes, Net Income, and Earnings Per Share

Income Before Income Taxes for the third quarter of 2012 was $2.6 million
compared to $0.8 million for the third quarter of 2011. For the nine months
ended September 30, 2012, Income Before Income Taxes was $7.8 million versus a
loss of $0.2 million in the prior year period.

Net Income (Loss) attributable to ORBCOMM Inc. Common Stockholders was $2.3
million for the three months ended September 2012 compared to $0.5 million for
the similar three-month period in 2011. For the nine months ended September
30, 2012, Net Income (Loss) attributable to ORBCOMM Inc. Common Stockholders
was $6.6 million versus a loss of $0.7 million in the prior year period.

Earnings Per Share were $0.05 for the third quarter of 2012 versus $0.01 for
the third quarter of 2011, and were $0.14 per share for the first nine months
of 2012 versus a loss of ($0.02) for the first nine months of 2011.

EBITDA and Adjusted EBITDA

EBITDA for the third quarter of 2012 was $3.9 million compared to $2.3 million
in the third quarter of 2011, an increase of 68%. EBITDA for the first nine
months of 2012 was $11.1 million compared to $3.9 million in the first nine
months of 2011, an increase of 184%.

Adjusted EBITDA for the third quarter of 2012 was $4.3 million compared to
$2.7 million in the third quarter of 2011, an increase of 59%. Adjusted EBITDA
margin as a percentage of Total Revenues expanded to 27% in the quarter from
19% a year ago. Adjusted EBITDA for the first nine months of 2012 was $12.5
million compared to $5.2 million in the first nine months of 2011, an increase
of 139%.

EBITDA and Adjusted EBITDA are non-GAAP financial measures used by the
Company. Please see the financial tables at the end of the release for a
reconciliation of EBITDA and Adjusted EBITDA.

Balance Sheet & Cash Flow

At September 30, 2012, Cash and Cash Equivalents, Restricted Cash, and
Marketable Securities were $75.8 million, increasing from $75.4 million at
June 30, 2012.

Cash provided by operating activities was $8.9 million for the first nine
months of 2012. During the nine months ended September 30, 2012, cash of $11.7
million was used for capital expenditures, including OG2 satellite
expenditures, and $4.0 million was used in the purchase of LMS.

Total ORBCOMM Inc. Stockholders’ Equity was $180.6 million at September 30,
2012.

Subsequent Event

On November 7, 2012, our Board of Directors concluded, based on the
recommendation of management, that an impairment charge should be recognized
with respect to the loss of the prototype satellite. Accordingly, we estimate
that this impairment charge for the cost of the prototype satellite and
associated launch services and launch insurance will be approximately $11
million and will be reflected in our consolidated financial statements during
the fourth quarter of 2012. We have filed a claim under our launch insurance
policy for a total loss of the next-generation prototype for the maximum
amount covered by the policy of $10 million.

Investment Community Conference Call

ORBCOMM will host a conference call and webcast for the investment community
this morning at 10:30 AM ET. Senior management will review the results,
discuss ORBCOMM’s business, and address questions.

To access the call, domestic participants should dial 1-888-561-1799 at least
ten minutes prior to the start of the call. International callers should dial
1-480-629-9774. To hear a live web simulcast or to listen to the archived
webcast following completion of the call, please visit the Company’s website
at www.orbcomm.com, select the “About us†tab, then the investor relations
tab, then select “Presentations and Webcasts,†to access the link to the
call. To listen to a telephone replay of the conference call, please dial
1-800-406-7325 domestically or 1-303-590-3030 internationally and enter
reservation identification number 4574578. The replay will be available from
approximately 12:00 PM ET on November 8, 2012, through 11:59 PM ET on November
15, 2012.

About ORBCOMM Inc.

ORBCOMM is a leading global satellite data communications company,
specializing in Machine-to-Machine (M2M) communications. Its customers include
Caterpillar Inc., Doosan Infracore America, Hitachi Construction Machinery,
and Hyundai Heavy Industries, Asset Intelligence (a subsidiary of I.D.
Systems, Inc.), Komatsu Ltd., Manitowoc Crane Companies, Inc., and Volvo
Construction Equipment among other industry leaders. By means of a global
network of low-earth orbit (LEO) satellites and accompanying ground
infrastructure, ORBCOMM’s low-cost and reliable two-way data communication
services track, monitor and control mobile and fixed assets in our core
markets: commercial transportation; heavy equipment; industrial fixed assets;
marine and homeland security. ORBCOMM based products are installed on trucks,
containers, marine vessels, locomotives, backhoes, pipelines, oil wells,
utility meters, storage tanks and other assets. ORBCOMM is an innovator and
leading provider of solution services for the refrigerated and transportation
markets. Under its ReeferTrak,^® GenTrak,^TM and CargoWatch ^ TM brands, the
Company provides customers with the ability to proactively monitor, manage and
remotely control their refrigerated and transportation assets. Additionally,
ORBCOMM provides Automatic Identification System (AIS) data services for
vessel tracking and to improve maritime safety to government and commercial
customers worldwide. ORBCOMM is headquartered in Fort Lee, New Jersey and has
its network control center in Dulles, Virginia. For more information, visit
www.orbcomm.com.

Forward-Looking Statements

Certain statements discussed in this press release constitute forward-looking
statements within the meaning of the Private Securities Litigation Reform Act
of 1995. These forward-looking statements generally relate to our plans,
objectives and expectations for future events and include statements about our
expectations, beliefs, plans, objectives, intentions, assumptions and other
statements that are not historical facts. Such forward-looking statements,
including those concerning the Company’s expectations, are subject to known
and unknown risks and uncertainties, which could cause actual results to
differ materially from the results, projected, expected or implied by the
forward-looking statements, some of which are beyond the Company’s control,
that may cause the Company’s actual results, performance or achievements, or
industry results, to be materially different from any future results,
performance or achievements expressed or implied by such forward-looking
statements. These risks and uncertainties include but are not limited to:
ongoing global economic instability and uncertainty; substantial losses we
have incurred and may incur; demand for and market acceptance of our products
and services and the applications developed by our resellers; we may need
additional capital to pursue our growth strategy; loss or decline or slowdown
in the growth in business from our key customers, such as Caterpillar Inc.,
(“Caterpillarâ€), Komatsu Ltd., (“Komatsuâ€), Hitachi Construction
Machinery Co., Ltd., (“Hitachiâ€), and Asset Intelligence, a subsidiary of
I.D. Systems, Inc. (“AIâ€), other value added resellers or VARs and
international value-added resellers or IVARs; loss or decline or slowdown in
growth in business of any of the specific industry sectors the Company serves,
such as transportation, heavy equipment, fixed assets, and maritime;
dependence on a few significant customers; our acquisition of the assets of
StarTrak Systems LLC and PAR Logistics Management Systems may expose us to
additional risks; litigation proceedings; technological changes, pricing
pressures and other competitive factors; the inability of our international
resellers and licensees to develop markets outside the United States; the
inability to obtain or maintain the necessary regulatory approvals or licenses
for particular countries or to operate our satellites; market acceptance and
success of our Automatic Identification System (“AISâ€) business; satellite
launch and construction delays and cost overruns of our next-generation
satellites and launch vehicles; launch and in-orbit satellite failures or
reduced performance of our existing satellites; significant liabilities
created by products we sell; the failure of our systems or reductions in
levels of service due to technological malfunctions or deficiencies or other
events; our inability to renew or expand our satellite constellation;
political, legal regulatory, government administrative and economic conditions
and developments in the United States and other countries and territories in
which we operate; and changes in our business strategy. In addition, specific
consideration should be given to various factors described in Part I, Item 1A.
“Risk Factors†and Part II, Item 7. “Management’s Discussion and
Analysis of Financial Condition and Results of Operationsâ€, and elsewhere in
our Annual Report on Form 10-K for the year ended December 31, 2011, and other
documents, on file with the Securities and Exchange Commission. The Company
undertakes no obligation to publicly revise any forward-looking statements or
cautionary factors, except as required by law.

ORBCOMM Inc.
Condensed Consolidated Balance Sheets
(in thousands, except share data)
(Unaudited)
                                             Â September 30, Â December 31,
                                                2012             2011
ASSETS
                                                                 Â
                                                                 Â
Current assets:
Cash and cash equivalents                       $  26,084        $  35,061
Restricted cash                                    -                1,000
Marketable securities                              47,508           45,973
Accounts receivable, net of allowances for         11,427           7,946
doubtful accounts of $301 and $299
Inventories                                        3,523            2,815
Prepaid expenses and other current assets          1,380            1,660
Deferred tax assets                             Â 852     Â    Â 912     Â
Total current assets                               90,774           95,367
                                                                 Â
Satellite network and other equipment, net         96,829           79,771
Goodwill                                           14,553           11,131
Intangible assets, net                             8,047            7,125
Restricted cash                                    2,195            2,220
Deferred tax assets                                135              136
Other assets                                    Â 1,611   Â    Â 1,419   Â
Total assets                                    $  214,144 Â    $  197,169 Â
                                                                 Â
LIABILITIES AND EQUITY
                                                                 Â
Current liabilities:
Accounts payable                                $  13,505        $  2,641
Accrued liabilities                                9,064            14,127
Current portion of note payable                    288              250
Current portion of deferred revenue             Â 2,457   Â    Â 2,099   Â
Total current liabilities                          25,314           19,117
Note payable - related party                       1,468            1,480
Note payable, net of current portion               3,167            3,376
Deferred revenue, net of current portion           1,937            1,570
Deferred tax liabilities                           1,019            823
Other liabilities                               Â 934     Â    Â 226     Â
Total liabilities                               Â 33,839  Â    Â 26,592  Â
                                                                 Â
Commitments and contingencies
                                                                 Â
Equity:
ORBCOMM Inc. stockholders' equity
Preferred Stock Series A, par value $0.001;
1,000,000 shares authorized;
159,768 and 186,265 shares issued and              1,596            1,861
outstanding
Common stock, par value $0.001; 250,000,000
shares authorized; 46,781,008 and
45,668,527 shares issued                           47               46
Additional paid-in capital                         247,866          244,543
Accumulated other comprehensive income             1,273            1,352
Accumulated deficit                                (70,067 )        (76,629 )
Less treasury stock, at cost, 29,990 shares
at September 30, 2012 and
0 shares at December 31, 2011                   Â (96     )     Â -       Â
Total ORBCOMM Inc. stockholders' equity            180,619          171,173
Noncontrolling interests                        Â (314    )     Â (596    )
Total equity                                    Â 180,305 Â    Â 170,577 Â
                                                                 Â
Total liabilities and equity                    $  214,144 Â    $  197,169 Â
                                                                            Â

ORBCOMM Inc.
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(Unaudited)
                     Â              Â              Â              Â
                        Three months ended              Nine months ended
                        September 30,                   September 30,
                        2012            2011            2012            2011
                                                                        Â
Revenues:
Service revenues        $  12,708       $  10,315       $  36,657       $  26,692
Product sales           Â 3,386  Â    Â 3,625  Â    Â 11,635 Â    Â 5,940  Â
Total revenues          Â 16,094 Â    Â 13,940 Â    Â 48,292 Â    Â 32,632 Â
                                                                        Â
Costs and expenses
^(1):
Costs of services          5,108           4,483           14,764          11,721
Costs of product           2,335           2,659           8,006           4,315
sales
Selling, general and       5,390           5,146           16,330          14,216
administrative
Product development        630             361             1,811           816
Acquisition-related     Â 67     Â    Â 391    Â    Â 700    Â    Â 1,426  Â
costs
Total costs and         Â 13,530 Â    Â 13,040 Â    Â 41,611 Â Â Â 32,494 Â
expenses
                                                                        Â
Income from                2,564           900             6,681           138
operations
                                                                        Â
Other income
(expense):
Interest income            24              31              74              129
Other income               16              (14    )        68              (220   )
(expense)
Gain on
extinguishment of          -               -               1,062           -
debt, net of
expenses
Interest expense        Â (13    )     Â (110   )     Â (45    )     Â (236   )
Total other income      Â 27     Â    Â (93    )     Â 1,159  Â    Â (327   )
(expense)
                                                                        Â
Income (loss) before       2,591           807             7,840           (189   )
income taxes
                                                                        Â
Income taxes            Â 284    Â    Â 272    Â    Â 1,080  Â    Â 578    Â
                                                                        Â
Net income (loss)          2,307           535             6,760           (767   )
                                                                        Â
Less: Net income
(loss) attributable
to the                  Â (17    )     Â (20    )     Â 145    Â    Â (50    )
noncontrolling
interests
                                                                        Â
Net income (loss)
attributable to         $  2,324  Â    $  555    Â    $  6,615  Â    $  (717   )
ORBCOMM Inc.
                                                                        Â
Net income (loss)
attributable to         $  2,307  Â    $  546    Â    $  6,562  Â    $  (726   )
ORBCOMM Inc. common
stockholders
                                                                        Â
Per share
information-basic:
Net income (loss)
attributable to         $  0.05   Â    $  0.01   Â    $  0.14   Â    $  (0.02  )
ORBCOMM Inc.
                                                                        Â
Per share
information-diluted:
Net income (loss)
attributable to         $  0.05   Â    $  0.01   Â    $  0.14   Â    $  (0.02  )
ORBCOMM Inc.
                                                                        Â
Weighted average
common shares
outstanding:
Basic                   Â 46,729 Â    Â 45,665 Â    Â 46,596 Â    Â 44,211 Â
Diluted                 Â 47,559 Â    Â 45,788 Â    Â 47,432 Â    Â 44,211 Â
                                                                        Â
(1) Stock-based
compensation
included in costs
and expenses:
Costs of services       $  71           $  34           $  185          $  94
Costs of product           6               2               14              2
sales
Selling, general and       289             362             913             951
administrative
Product development     Â 41     Â    Â 8      Â    Â 105    Â    Â 18     Â
                        $  407    Â    $  406    Â    $  1,217  Â    $  1,065  Â
                                                                        Â

ORBCOMM Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(Unaudited)
                                                          Â
                                                Nine months ended
                                                September 30,
                                                2012             2011
Cash flows from operating activities:
Net income (loss)                               $  6,760         $  (767    )
Adjustments to reconcile net income (loss)
to net cash
   provided by operating activities:
   Change in allowance for doubtful accounts       (19     )        (291    )
   Change in the fair value of
   acquisition-related contingent                  (130    )        -
   consideration
   Amortization of the fair value adjustment       (166    )        -
   related to StarTrak warranty liabilities
   Depreciation and amortization                   3,480            3,953
   Stock-based compensation                        1,217            1,065
   Foreign exchange (gains) losses                 (66     )        17
   Amortization of premium on marketable           606              1,041
   securities
   (Increase) decrease in fair value of            (84     )        47
   indemnification assets
   Deferred income taxes                           255              121
   Gain on extinguishment of debt and              (1,214  )        -
   accounts payable
   Amortization of transition shared               114              -
   services
   Amortization of debt discount for the 6%
   secured promissory note issued
   in connection with the acquisition of           -                9
   StarTrak
   Loss on disposition of other investment         -                305
   in Alanco
   Accretion on note payable-related party         -                98
   Dividend received in common stock from          -                (84     )
   other investment
Changes in operating assets and liabilities,
net of acquisitions:
   Accounts receivable                             (2,258  )        (1,756  )
   Inventories                                     562              359
   Prepaid expenses and other assets               278              (51     )
   Accounts payable and accrued liabilities        (924    )        266
   Deferred revenue                                638              (269    )
   Other liabilities                            Â (161    )     Â (88     )
   Net cash provided by operating activities    Â 8,888   Â    Â 3,975   Â
                                                                 Â
Cash flows from investing activities:
Capital expenditures                               (11,658 )        (5,937  )
Purchases of marketable securities                 (52,493 )        (47,497 )
Proceeds from maturities of marketable             50,352           81,146
securities
Acquisition of net assets of StarTrak, net         -                (1,876  )
of cash acquired of $322
Change in restricted cash                          1,025            810
Acquisition of net assets of LMS                Â (4,000  )     Â -       Â
   Net cash (used in) provided by investing     Â (16,774 )     Â 26,646  Â
   activities
                                                                 Â
Cash flows from financing activities
Purchase of noncontrolling ownership
interests in Satcom
   International Group plc                         (199    )        -
Repayment of Satcom notes payable                  (253    )        -
Principal payments of note payable                 (187    )        (200    )
Principal payments of capital leases               (367    )        -
Payment upon exercise of SARs                   Â -       Â    Â (24     )
   Net cash used in financing activities        Â (1,006  )     Â (224    )
                                                                 Â
Effect of exchange rate changes on cash and     Â (85     )     Â 302     Â
cash equivalents
                                                                 Â
Net increase (decrease) in cash and cash           (8,977  )        30,699
equivalents
                                                                 Â
Cash and cash equivalents:
Beginning of period                             Â 35,061  Â    Â 17,026  Â
                                                                 Â
End of period                                   $  26,084  Â    $  47,725  Â
                                                                 Â

The following table reconciles our Net Income (Loss) attributable to ORBCOMM
Inc. to EBITDA and Adjusted EBITDA for the periods shown:

                                     Three months ended  Nine months ended
                                       September 30,         September 30,
(in thousands)                         2012    Â  2011      2012    Â 2011
Net Income (Loss) attributable to      $2,324      $555      $6,615     $(717)
ORBCOMM Inc.
Net interest (income) expense          (11)        79        (29)       107
Provision for income taxes             284         272       1,080      578
Depreciation and amortization          1,290       1,403     3,480      3,953
EBITDA                                 3,887       2,309     11,146     3,921
Stock-based compensation               407         406       1,217      1,065
Loss on disposition of other           -           -         -          305
investment in Alanco
Noncontrolling interests               (17)        (20)      145        (50)
                                       Â          Â        Â         Â
Adjusted EBITDA                        $4,277      $2,695    $12,508    $5,241
                                                                        Â

EBITDA is defined as earnings attributable to ORBCOMM Inc. before interest
income (expense), provision for income taxes and depreciation and
amortization. ORBCOMM believes EBITDA is useful to its management and
investors in evaluating operating performance because it is one of the primary
measures used to evaluate the economic productivity of the Company’s
operations, including its ability to obtain and maintain its customers, its
ability to operate its business effectively, the efficiency of its employees
and the profitability associated with their performance. It also helps
ORBCOMM’s management and investors to meaningfully evaluate and compare the
results of the Company’s operations from period to period on a consistent
basis by removing the impact of its financing transactions and the
depreciation and amortization impact of capital investments from its operating
results. In addition, ORBCOMM management uses EBITDA in presentations to its
board of directors to enable it to have the same measurement of operating
performance used by management and for planning purposes, including the
preparation of the annual operating budget. The Company also believes that
EBITDA, adjusted for Stock-based compensation expense, Loss on disposition of
other investment in Alanco, and Noncontrolling interests is useful to
investors to evaluate the Company’s core operating results and financial
performance and its capacity to fund capital expenditures, because it excludes
items that are significant non-cash expenses reflected in the Condensed
Consolidated Statements of Operations. EBITDA and Adjusted EBITDA are not
performance measures calculated in accordance with accounting principles
generally accepted in the United States, or GAAP. While ORBCOMM considers
EBITDA and Adjusted EBITDA to be important measures of operating performance,
they should be considered in addition to, and not as a substitute for, or
superior to, Net Income (loss) or other measures of financial performance
prepared in accordance with GAAP and may be different than EBITDA and Adjusted
EBITDA measures presented by other companies. A reconciliation table is
presented above.

Contact:

Investor Inquiries:
ORBCOMM Inc.
Robert Costantini, 703-433-6305
EVP and Chief Financial Officer
or
Media Inquiries:
The Abernathy MacGregor Group
Jennifer Stroud, 212-371-5999
Vice President
jcl@abmac.com
 
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