GeoEye Wins National Geospatial-Intelligence Agency Enhanced View Award
Dulles VA (SPX) Aug 10, 2010
GeoEye has announced it won a $3.8 billion contract award from the National Geospatial-Intelligence Agency (NGA) for increased commercial satellite-imaging capacity.
This competitively awarded contract supports the EnhancedView program by providing products and services that will help meet the increasing geospatial intelligence needs of the intelligence community and Department of Defense.
The award includes the following components with $2.8 billion for commercial satellite imagery purchases over the next ten years as follows:
+ An extension of the NGA's current ability to purchase commercial imagery from the Company's existing satellite constellation under a Service Level Agreement (SLA) for $150 million per year.
+ An additional award to purchase commercial imagery, when GeoEye-2 becomes operational in 2013, for approximately $184 million per year for seven years.
+ $337 million cost share for the development and launch of GeoEye-2.
+ $700 million for value-added products and services to include the design and procurement of additional infrastructure to support government operations. This also includes our EyeQ Web Mapping Services to be delivered under the SLA.
The period of performance for the contract runs initially from Sept. 1, 2010, to Aug. 31, 2011, with nine, one-year options. As with all government contracts, funding is subject to annual congressional budget approval.
Matt O'Connell, GeoEye's chief executive officer and president, said, "We are very gratified by this award. With this award, we'll continue the accelerated development of our GeoEye-2 satellite so that it is operational in 2013. We will also upgrade our infrastructure and continue expanding our Web-delivery systems so that we can deliver the world's best commercial imagery to the NGA and our other customers anywhere, anytime."
"We have been proud to serve the NGA for more than two decades, and we look forward to continuing this strong legacy of service as commercial imagery becomes fully integrated into the national imagery architecture," said Bill Schuster, GeoEye's chief operating officer.
"We're particularly proud that the NGA has chosen us to support their important EnhancedView program and to help ensure that the nation has access to the best commercial imagery in the world."
The agreement provides for DigitalGlobe to supply satellite imagery deliveries from the WorldView satellite constellation under a Service Level Agreement ("EnhancedView SLA") in a total amount of $2.8 billion. The agreement also provides for up to $750 million for value added products, infrastructure enhancements and other services.
The agreement has a ten year term, inclusive of nine one-year options exercisable by NGA, and is subject to Congressional appropriations and the right of NGA to terminate or suspend the contract at any time.
The EnhancedView SLA portion of the award is sized at $2.8 billion over the term of the contract; $250 million annually, or $20.8 million per month, for the first four contract years, commencing September 1, 2010, with an increase to $300 million annually, or $25 million per month, for the remaining six years of the agreement term.
To support requirements under the agreement, DigitalGlobe will immediately begin procurement and construction of its next satellite, WorldView-3, which the Company anticipates will be ready for launch by the end of 2014.
Updated Full-Year 2010 Outlook
+ Full-year 2010 total revenue is expected to be between $340 million and $360 million.
+ Full-year 2010 diluted earnings per share are expected to be between $0.40 and $0.55.
+ Full-year 2010 Adjusted EBITDA is expected to be between $195 million and $210 million, with margins between 57% and 59%.
+ Total capital expenditures for 2010 are expected to be between $110 and $120 million, including between $30 and $35 million related to maintenance and between $80 and $85 million related to incremental capital required to meet new requirements of the EnhancedView SLA.
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