ORBCOMM Announces Results for Fourth Quarter and Full Year 2012

  ORBCOMM Announces Results for Fourth Quarter and Full Year 2012

  – Adjusted EBITDA of $16.7 Million for 2012 and $4.2 Million in the 4^th
                                  Quarter –

– Net Income of $8.7 Million or $0.19 Per Share for 2012 Compared to Breakeven
                                  for 2011–

                 – Service Revenues Increased 31% for 2012 –

               – Two New Global Heavy Equipment OEM Partners –

   – Acquisitions Expand End-To-End Solution Offerings in Two Key Vertical
                                  Markets –

Business Wire

ROCHELLE PARK, N.J. -- March 14, 2013

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 fourth quarter and full year ended
December 31, 2012.

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

                                                                    
                       Three months ended          Twelve months ended
                       December 31,                December 31,
                       2012       2011          2012       2011
Service Revenues       $12,369       $10,821       $49,026       $37,513
Product Sales          $3,837        $2,853        $15,472       $8,793
Total Revenues         $16,206       $13,674       $64,498       $46,306
                                                                             
Net Income
(loss)
attributable to        $2,111        $681          $8,673        $(45)
ORBCOMM Inc.
Common
Stockholders
Net Income
(loss) per             $0.05         $0.01         $0.19         $(0.00)
Common Share -
basic
EBITDA ^(1,3)          $3,773        $1,900        $14,919       $5,821
Adjusted EBITDA        $4,167        $2,761        $16,674       $8,002
^(2,3)
                                                                             

^(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,
noncontrolling interests, impairment loss and insurance recovery.

^(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.

Recent Highlights:

  *Adjusted EBITDA for the quarter was $4.2 million, up 51% from $2.8 million
    during the same three months last year. Adjusted EBITDA for the full year
    was $16.7 million, up 108% from $8.0 million last year. ORBCOMM reported
    basic EPS of $0.05 for the fourth quarter of 2012 compared to EPS of $0.01
    for the comparable period last year, and EPS of $0.19 for the full year
    2012 versus breakeven of ($0.00) for 2011.
  *For the fourth quarter of 2012, Service Revenues increased 14%
    year-over-year to $12.4 million and were $49.0 million for the full year
    2012, a 31% increase over the full year 2011. For the fourth quarter of
    2012, net subscriber additions were 15,000. ORBCOMM had 759,000 billable
    subscriber communicators at December 31, 2012, compared to 648,000 at the
    end of the fourth quarter last year. The base of billable subscribers
    increased 17% year-over-year.
  *The company’s initiative to develop end-to-end solutions within key
    vertical markets continues to build momentum.

       *New Products: StarTrak introduced an enhancement of its refrigerated
         product, which is now capable of monitoring and controlling heated
         assets. In the first quarter of 2013, the largest rail network in
         Canada began the first broad deployment using this capability.
         Including StarTrak’s two-way GenTrak^TM and ReeferTrak^® telematics
         management systems, we are now providing temperature-controlled
         services for refrigerated and heated containers. Together, these
         solutions will allow the customer to monitor multiple shipping
         conditions to verify temperature compliance.
       *Strategic Acquisitions: In the first quarter of 2013, ORBCOMM took
         steps to expand its end-to-end solutions portfolio in heavy equipment
         and transportation.

         On March 13, 2013, ORBCOMM entered into a definitive purchase
         agreement to acquire substantially all of the assets of MobileNet, a
         leader of satellite and cellular-based telematics solutions for
         monitoring heavy equipment and assets that support the rail industry
         as well as being a long-time ORBCOMM value-added reseller. The
         acquisition of the MobileNet business supports ORBCOMM’s growth
         strategy of expanding its end-to-end solutions portfolio in key
         vertical markets. Integrating MobileNet’s unique products and
         services will allow ORBCOMM to directly address opportunities within
         the heavy equipment industry through Original Equipment Manufacturers
         (OEM’s), dealers and fleet owners. Some of MobileNet’s current
         customers include Doosan North America, a world-class construction
         equipment company, and leading rail companies Union Pacific, CSX, and
         BNSF.

         On March 13, 2013, ORBCOMM entered into a definitive purchase
         agreement to acquire substantially all of the assets of GlobalTrak, a
         division of System Planning Corp. GlobalTrak is an information
         services company that utilizes satellite and cellular communications
         networks, sensors and proprietary software platforms to provide
         real-time situational awareness and intelligence to improve logistics
         and security processes and operations on a global basis. GlobalTrak’s
         customer base includes military, international, government, and
         commercial customers. The acquisition of GlobalTrak enables ORBCOMM
         to expand its end-to-end solutions offerings for mobile asset
         applications and expand distribution into the government sector and
         into new geographic regions, including the Middle East and Asia.

  *The company added two new heavy equipment OEM partners to expand its
    leadership position as a leading supplier of M2M network connectivity for
    the telematics market.

       *In the first quarter of 2013, Sumitomo, one of Japan's leading
         manufacturers of excavators, asphalt pavers and other construction
         equipment, selected ORBCOMM to provide global satellite
         communications services to deliver vital telematics data to Sumitomo
         and its customers.
       *A premier European manufacturer and supplier of mining and
         construction equipment will utilize ORBCOMM’s dual-mode satellite and
         cellular service for its global OEM telematics application. The
         robust solution will offer its customers the ability to track and
         monitor their heavy surface drilling equipment worldwide.

  *On January 7, 2013, ORBCOMM announced a $45 million Term Loan financing
    with AIG Asset Management (U.S.), LLC. The loan will primarily be used to
    facilitate growth opportunities such as new services, product offerings,
    geographic distribution and potential strategic acquisitions into key
    vertical markets.
  *On February 19, 2013, Boeing Corporation (Boeing) delivered the first
    production payload to Sierra Nevada Corporation (SNC) for ORBCOMM's OG2
    next generation constellation. Designed to enhance data throughput of
    ORBCOMM's OG2 satellites, Boeing’s state-of-the-art, versatile
    communications payload will provide enhanced operational capabilities,
    including faster communications speeds, to support mission-critical
    communications for ORBCOMM customers. SNC will begin integration and
    environmental performance testing of the OG2 satellite in preparation for
    the planned launch later this year.

For more information on recent highlights, please visit www.orbcomm.com.

“2012 was a record year for ORBCOMM and we are starting to see the
transformative effect of our strategic growth initiatives,” said Marc
Eisenberg, Chief Executive Officer of ORBCOMM. “Over the past 18 months, we
have made strides in not only growing our core M2M network connectivity
business, but also in expanding our focus on end-to-end solutions within key
vertical markets, which enable us to capture a significantly larger portion of
the value chain.” He continued, “We are also making solid progress on OG2,
which is ORBCOMM’s second generation satellite constellation, scheduled to
begin launching later in 2013.”

“ORBCOMM’s strong fourth quarter profitability, driven by increases in
revenues, underscores our focus on growth and profitability,” said Robert
Costantini, Chief Financial Officer of ORBCOMM. “During the fourth quarter,
Total Revenues grew 19% to $16.2 million and Adjusted EBITDA grew 51% to $4.2
million year-over-year. Adjusted EBITDA margins expanded to 26% compared to
20% during the same period last year, continuing to demonstrate strong
operating leverage in the business.”

Financial Results and Highlights

Revenues

For the fourth quarter ended December 31, 2012, Service Revenues were $12.4
million compared to $10.8 million during the same period last year. The
year-over-year increase of 14% was the result of an increase in our core and
direct channel service revenues as well as AIS revenues. For the year ended
December 31, 2012, Service Revenues were $49.0 million compared to $37.5
million during the same period last year, increasing 31%.

Product Sales during the fourth quarter of 2012 were $3.8 million compared to
$2.9 million during the same period last year. The year-over-year increase of
34% in Product Sales was largely due to an increase in direct channel
equipment sales. Product Sales for the year ended December 31, 2012 increased
76% to $15.5 million from $8.8 million during the same period last year.

Total Revenues for the quarter ended December 31, 2012 were $16.2 million
compared to $13.7 million during the same period of 2011, an increase of 19%.
Total Revenues for the year ended December 31, 2012 were $64.5 million
compared to $46.3 million during the same period of 2011, an increase of 39%.

Costs and Expenses

Costs and Expenses for the fourth quarter of 2012 were $13.8 million compared
to $12.8 million during the same period in 2011. Costs and Expenses for the
year ended December 31, 2012 were $55.4 million compared to $45.3 million
during the same period in 2011. The increases for the fourth quarter and full
year were mostly due to costs associated with growth in the core business and
expenses related to operating the LMS acquisition that were not present in the
prior year period, offset by a reduction in Acquisition-related costs and a
$0.2 million net impairment gain on the next-generation prototype satellite.

Costs of Product Sales for the fourth quarter of 2012 were $2.2 million
compared to $2.3 million for the three months ended December 31, 2011, a
decrease of 5% largely due to lower warranty costs. Costs of Services, Product
Development, and Selling, General and Administrative Expenses were $11.8
million for the fourth quarter of 2012 compared to $10.3 million in the prior
year fourth quarter, an increase of $1.5 million primarily related to
increased business activity and the addition of operating expenses for the LMS
acquisition. Acquisition-related Costs were negligible in the fourth quarter
of 2012.

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

Income Before Income Taxes for the fourth quarter of 2012 was $2.5 million
compared to $1.0 million for the fourth quarter of 2011. For the year ended
December 31, 2012, Income Before Income Taxes was $10.3 million versus $0.8
million in the prior year period.

Net Income attributable to ORBCOMM Inc. Common Stockholders was $2.1 million
for the three months ended December 31, 2012 compared to $0.7 million for the
similar three-month period in 2011. For the year ended December 31, 2012, Net
Income (Loss) attributable to ORBCOMM Inc. Common Stockholders was $8.7
million versus a loss of $45,000 in the prior year period.

Basic Earnings Per Share were $0.05 for the fourth quarter of 2012 versus
$0.01 for the fourth quarter of 2011, and were $0.19 per share for the year
ended December 31, 2012 versus a loss of ($0.00) in the prior year.

EBITDA and Adjusted EBITDA

EBITDA for the fourth quarter of 2012 was $3.8 million compared to $1.9
million in the fourth quarter of 2011, an increase of 99%. EBITDA for the year
ended December 31, 2012 was $14.9 million compared to $5.8 million in the
prior year period, an increase of 156%.

Adjusted EBITDA for the fourth quarter of 2012 was $4.2 million compared to
$2.8 million in the fourth quarter of 2011, an increase of 51%. Adjusted
EBITDA margin as a percentage of Total Revenues expanded to 26% in the quarter
from 20% a year ago. Adjusted EBITDA for the year ended December 31, 2012 was
$16.7 million compared to $8.0 million in the prior year, an increase of 108%.

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 December 31, 2012, Cash and Cash Equivalents, Restricted Cash, and
Marketable Securities were $64.9 million, decreasing from $75.8 million at
September 30, 2012 mainly due to milestone payments for our next-generation
satellites, partially offset by the insurance proceeds received from the loss
of the next-generation prototype satellite and cash provided from operating
activities. The net proceeds from the AIG term loan that was completed in
early January 2013 are not reflected in the 2012 year-end cash balance.

Cash provided by operating activities was $13.9 million for the year ended
December 31, 2012. For the year ended December 31, 2012, cash of $36.6 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 $182.7 million at December 31,
2012.

Subsequent Events

On January 7, 2013, ORBCOMM announced a debt financing in the form of a
five-year term loan through a Senior Secured Note Agreement in the principal
amount of $45 million with AIG Asset Management (U.S.), LLC. The five-year
term loan has no required principal amortization and a fixed interest rate of
9.5%, payable quarterly, for the life of the loan. The company intends to
primarily use the proceeds to grow by providing new services, product
offerings, geographic distribution and potential acquisitions into key
vertical markets.

On February 19, 2013, ORBCOMM relocated its corporate headquarters to Rochelle
Park, NJ. The new and larger facility that will combine the corporate offices
at Fort Lee, New Jersey, and the StarTrak facilities in Morris Plains, New
Jersey, will have the capacity to support the company’s future growth plans.

On March 13, 2013, ORBCOMM entered into definite purchase agreements to
acquire substantially all of the assets of MobileNet and GlobalTrak, as
discussed above.

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 1-877-941-9205 at least
ten minutes prior to the start of the call. International callers should dial
1-480-629-9819. 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 4606713. The replay will be available from
approximately 12:00 PM ET on March 14, 2013, through 11:59 PM ET on March 21,
2013.

About ORBCOMM Inc.

ORBCOMM is a leading global satellite data communications company,
specializing in Machine-to-Machine (M2M) communications and solutions. 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 Rochelle Park,
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.,
(“Caterpillar”), Komatsu Ltd., (“Komatsu”), Hitachi Construction Machinery
Co., Ltd., (“Hitachi”), and Asset Intelligence, a subsidiary of I.D. Systems,
Inc. (“AI”), 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 (“AIS”) 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
Operations”, 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.

<td class="bwpadl0 *Broken Story*
                                               
ORBCOMM Inc.
Consolidated Balance Sheets
(in thousands, except share data)
                                                               
                                                   December 31,
                                                   2012            2011
                                                                   
ASSETS
                                                                   
Current assets:
Cash and cash equivalents                          $ 34,783        $ 35,061
Restricted cash                                      -               1,000
Marketable securities                                27,969          45,973
Accounts receivable, net of allowances for           10,703          7,946
doubtful accounts of $300 and $300
Inventories                                          3,748           2,815
Prepaid expenses and other current assets            1,484           1,660
Deferred income taxes                               164           912     
Total current assets                                 78,851          95,367
                                                                   
Satellite network and other equipment, net           101,208         79,771
Goodwill                                             14,740          11,131
Intangible assets, net                               7,791           7,125
Restricted cash                                      2,195           2,220
Other assets                                         1,583           1,419
Deferred income taxes                               398           136     
                                                                   
Total assets                                       $ 206,766      $ 197,169 
                                                                   
LIABILITIES AND EQUITY
                                                                   
Current liabilities:
Accounts payable                                   $ 2,899         $ 2,641
Accrued liabilities                                  11,271          14,127
Current portion of note payable                      -               250
Current portion of deferred revenue                 2,394         2,099   
Total current liabilities                            16,564          19,117
Note payable - related party                         1,503           1,480
Note payable, net of current portion                 3,398           3,376
Deferred revenue, net of current portion             1,959           1,570
Deferred tax liabilities                             397             823
Other liabilities                                   557           226     
Total liabilities                                   24,378        26,592  
                                                                   
Commitments and contingencies
                                                                   
Equity:
ORBCOMM Inc. stockholders' equity
Preferred Stock Series A, par value $0.001;
1,000,000 shares authorized; 161,359 and             1,612
186,265 shares issued and outstanding
 
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