EX-99.1 9 pressreleaseq32022-exx991.htm EX-99.1 Document
Exhibit 99.1

EchoStar Announces Financial Results for the Three and Nine Months Ended September 30, 2022

Englewood, CO, November 2, 2022—EchoStar Corporation (NASDAQ: SATS) announced its financial results for the three and nine months ended September 30, 2022.

Three Months Ended September 30, 2022 Financial Highlights:

•Consolidated revenue of $497.4 million.
•Consolidated net income of $19.6 million, consolidated net income attributable to EchoStar common stock of $22.4 million and basic and diluted earnings per share of common stock of $0.27.
•Consolidated Adjusted EBITDA of $158.8 million (see discussion and the reconciliation of GAAP to this non-GAAP measure below).

Nine Months Ended September 30, 2022 Financial Highlights:

•Consolidated revenue of $1,498.2 million.
•Consolidated net income of $119.0 million, consolidated net income attributable to EchoStar common stock of $127.7 million, and basic and diluted earnings per share of common stock of $1.51.
•Consolidated Adjusted EBITDA of $492.4 million (see discussion and the reconciliation of GAAP to this non-GAAP measure below).

“During the third quarter of 2022, the EchoStar team continued to optimize operations and asset yields, delivering a solid performance,” said Hamid Akhavan, CEO and President of EchoStar. “We remain focused on operating the business in an efficient manner while also preparing for the launch of our EchoStar XXIV/JUPITER 3 satellite. We have capitalized on enterprise market opportunities, and I am pleased that we have increased sales of equipment, primarily developed in-house, for both the three and nine month periods ending September 30, compared to the same periods last year. We continue to seek opportunities in pursuit of our strategy of being a global connectivity and services provider.”

Three Months Ended September 30, 2022 - Additional Information:

•Consolidated revenue decreased 1.4% or $7.3 million year over year. Lower service revenue of $31.4 million, primarily due to lower broadband consumer customers, was partially offset by higher equipment sales of $24.1 million to our domestic and international enterprise customers. The decrease includes an estimated negative foreign exchange impact of $3.8 million.
•Consolidated net income decreased $10.7 million year over year. The decrease was primarily due to lower operating income of $15.6 million and an unfavorable change in investments of $13.8 million. These items were partially offset by lower net interest expense of $10.9 million, lower net income tax expense of $6.6 million, and lower losses on foreign exchange of $3.8 million.
•Consolidated Adjusted EBITDA decreased 15.1% or $28.2 million year over year.
◦Hughes segment adjusted EBITDA decreased $25.4 million year over year. The decrease was driven by lower gross margin due primarily to a change in revenue mix.
◦ESS segment adjusted EBITDA increased $1.1 million year over year.
◦Corporate and Other segment adjusted EBITDA decreased $3.9 million year over year. The decrease was primarily due to higher corporate expenses and lower earnings of unconsolidated affiliates, net, of $1.3 million.
•Hughes broadband subscribers totaled approximately 1,285,000, declining 61,000 from June 30, 2022. Current capacity limitations as well as competitive pressures are impacting consumer subscriber levels. In Latin America, subscriber levels were also impacted by adverse economic
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conditions, more selective customer screening, and capacity allocation to higher economic value enterprise and government applications.
•For the three months ended September 30, 2022, approximately 60% of Hughes segment revenue was attributable to consumer customers with approximately 40% attributable to enterprise customers.
•Cash, cash equivalents and current marketable investment securities were $1.6 billion as of September 30, 2022.
•During the three months ended September 30, 2022, we purchased 593,643 shares of our Class A common stock in open market trades.
•The Jupiter 3/EchoStar XXIV satellite continues to progress at Maxar and is expected to be launched during the first half of 2023
Set forth below is a table highlighting certain of EchoStar’s segment results for the three and nine months ended September 30, 2022 and 2021 (amounts in thousands) (all US GAAP amounts reference results from operations):
For the three months ended September 30,For the nine months ended September 30,
 2022202120222021
Revenue
Hughes
$489,565 $496,937 $1,475,512 $1,465,073 
EchoStar Satellite Services
4,981 4,436 14,305 12,808 
Corporate and Other
2,841 3,287 8,420 9,195 
Total revenue
$497,387 $504,660 $1,498,237 $1,487,076 
Adjusted EBITDA
Hughes
$177,574 $202,997 $544,284 $612,251 
EchoStar Satellite Services
3,447 2,319 9,658 6,481 
Corporate & Other:
Corporate overhead, operating and other
(22,521)(19,974)(62,265)(61,940)
Equity in earnings (losses) of unconsolidated affiliates, net
319 1,630 759 2,615 
Total Corporate & Other
(22,202)(18,344)(61,506)(59,325)
Total Adjusted EBITDA
$158,819 $186,972 $492,436 $559,407 
Net income (loss)$19,550 $30,217 $118,968 $142,804 
Expenditures for property and equipment
$61,457 $89,537 $249,374 $352,003 

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Reconciliation of GAAP to Non-GAAP Measurement (amounts in thousands):
For the three months ended September 30,For the nine months ended September 30,
2022202120222021
Net income (loss)$19,550 $30,217 $118,968 $142,804 
Interest income, net(14,183)(5,725)(29,677)(16,914)
Interest expense, net of amounts capitalized13,845 16,313 43,125 79,848 
Income tax provision (benefit), net13,195 19,748 51,367 63,047 
Depreciation and amortization110,233 120,596 347,224 368,864 
Net loss (income) attributable to non-controlling interests2,853 3,192 8,736 6,419 
EBITDA
145,493 184,341 539,743 644,068 
(Gains) losses on investments, net
10,077 (3,748)(48,071)(112,981)
Impairment of long-lived assets— — 711 245 
Litigation Expense— — — 16,800 
License fee dispute - India, net of non-controlling interests
444 (262)— (708)
Loss on Debt Repurchase— — — 1,938 
Foreign currency transaction (gains) losses, net
2,805 6,641 53 10,045 
Adjusted EBITDA
$158,819 $186,972 $492,436 $559,407 

Note on Use of Non-GAAP Financial Measures

EBITDA is defined as “Net income (loss)” excluding “Interest income, net,” “Interest expense, net of amounts capitalized,” “Income tax benefit (provision), net,” “Depreciation and amortization,” and “Net income (loss) attributable to non-controlling interests.”

Adjusted EBITDA is defined as EBITDA excluding Gains and losses on investments, net, Foreign currency transaction gains (losses), net, and other non-recurring or non-operational items. EBITDA and Adjusted EBITDA are not measures determined in accordance with US GAAP. EBITDA and Adjusted EBITDA are reconciled to Net income (loss) in the table above and should not be considered in isolation or as a substitute for operating income, net income or any other measure determined in accordance with US GAAP. Our management uses EBITDA and Adjusted EBITDA as measures of our operating efficiency and overall financial performance for benchmarking against our peers and competitors. Management believes that these non-GAAP measures provide meaningful supplemental information regarding the underlying operating performance of our business and are appropriate to enhance an overall understanding of our financial performance. Management also believes that EBITDA and Adjusted EBITDA are useful to investors because they are frequently used by securities analysts, investors, and other interested parties to evaluate the performance of companies in our industry.

The consolidated financial statements of EchoStar for the periods ended September 30, 2022 and 2021 are attached to this press release. Detailed financial data and other information are available in EchoStar’s Quarterly Report on Form 10-Q for the period ended September 30, 2022 filed today with the Securities and Exchange Commission.

EchoStar will host a conference call to discuss its earnings on Thursday, November 3, 2022 at 11:00 a.m. Eastern Time. The conference call will be broadcast live in listen-only mode on EchoStar’s investor relations website at ir.echostar.com. To participate via telephone and ask a question, participants must register using an online form found at https://register.vevent.com/register/BIe14657de944641eeb7839877222163e8.





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About EchoStar Corporation

EchoStar Corporation (NASDAQ: SATS) is a premier global provider of satellite communications solutions. Headquartered in Englewood, Colo., and conducting business around the globe, EchoStar is a pioneer in secure communications technologies through its Hughes Network Systems and EchoStar Satellite Services business segments.

Safe Harbor Statement under the US Private Securities Litigation Reform Act of 1995

This press release may contain statements that are forward looking, as that term is defined by the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management’s beliefs, as well as assumptions made by, and information currently available to, management. When used in this release, the words “believe,” “anticipate,” “goal,” “seek,” “estimate,” “expect,” “intend,” “project,” “continue,” “future,” “will,” “would,” “can,” “may,” “plans,” and similar expressions and the use of future dates are intended to identify forward‑looking statements. Although management believes that the expectations reflected in these forward‑looking statements are reasonable, it can give no assurance that these expectations will prove to have been correct. You are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date made. We assume no responsibility for the accuracy of forward-looking statements or information or for updating forward-looking information or statements. These statements are subject to certain risks, uncertainties, and assumptions. See “Risk Factors” in EchoStar’s Annual Report on Form 10-K for the period ended December 31, 2021 as filed with the Securities and Exchange Commission and in the other documents EchoStar files with the Securities and Exchange Commission from time to time.

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Contact Information
EchoStar Investor Relations
EchoStar Media Relations
Terry Brown
Phone: +1 303-728-5179
Email: terry.brown@echostar.com
Sharyn Nerenberg
Phone: +1 301-428-7124
Email: sharyn.nerenberg@echostar.com
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ECHOSTAR CORPORATION
Consolidated Balance Sheets
(Amounts in thousands, except share and per share amounts)
 As of
 September 30, 2022December 31, 2021
Assets  
Current assets:  
Cash and cash equivalents$901,269 $535,894 
Marketable investment securities666,904 1,010,496 
Trade accounts receivable and contract assets, net243,683 182,063 
Other current assets, net229,214 198,444 
Total current assets2,041,070 1,926,897 
Non-current assets:  
Property and equipment, net2,251,258 2,338,285 
Operating lease right-of-use assets147,811 149,198 
Goodwill532,570 511,086 
Regulatory authorizations, net460,084 469,766 
Other intangible assets, net16,323 13,984 
Other investments, net352,778 297,747 
Other non-current assets, net323,411 338,241 
Total non-current assets4,084,235 4,118,307 
Total assets$6,125,305 $6,045,204 
Liabilities and Stockholders' Equity  
Current liabilities:  
Trade accounts payable$95,019 $109,338 
Contract liabilities127,584 141,343 
Accrued expenses and other current liabilities183,613 209,442 
Total current liabilities406,216 460,123 
Non-current liabilities:  
Long-term debt, net1,496,578 1,495,994 
Deferred tax liabilities, net434,043 403,684 
Operating lease liabilities133,197 134,897 
Other non-current liabilities119,719 136,426 
Total non-current liabilities2,183,537 2,171,001 
Total liabilities2,589,753 2,631,124 
Commitments and contingencies















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ECHOSTAR CORPORATION
Consolidated Balance Sheets
(Amounts in thousands, except share and per share amounts)


Stockholders' equity:  
Preferred stock, $0.001 par value, 20,000,000 shares authorized, none issued and outstanding at both September 30, 2022 and December 31, 2021
— — 
Common stock, $0.001 par value, 4,000,000,000 shares authorized:
  
Class A common stock, $0.001 par value, 1,600,000,000 shares authorized, 58,604,927 shares issued and 35,291,616 shares outstanding at September 30, 2022 and 58,059,622 shares issued and 38,726,923 shares outstanding at December 31, 2021
59 58 
Class B convertible common stock, $0.001 par value, 800,000,000 shares authorized, 47,687,039 shares issued and outstanding at both September 30, 2022 and December 31, 2021
48 48 
Class C convertible common stock, $0.001 par value, 800,000,000 shares authorized, none issued and outstanding at both September 30, 2022 and December 31, 2021
— — 
Class D common stock, $0.001 par value, 800,000,000 shares authorized, none issued and outstanding at both September 30, 2022 and December 31, 2021
— — 
Additional paid-in capital3,361,219 3,345,878 
Accumulated other comprehensive income (loss)(180,339)(212,102)
Accumulated earnings (losses)784,170 656,466 
Treasury shares, at cost(525,824)(436,521)
Total EchoStar Corporation stockholders' equity3,439,333 3,353,827 
Non-controlling interests96,219 60,253 
Total stockholders' equity3,535,552 3,414,080 
Total liabilities and stockholders' equity$6,125,305 $6,045,204 
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ECHOSTAR CORPORATION
Consolidated Statements of Operations
(Amounts in thousands, except per share amounts)

 For the three months ended September 30,For the nine months ended September 30,
 2022202120222021
Revenue:
Services and other revenue$401,382 $432,739 $1,234,890 $1,294,355 
Equipment revenue96,005 71,921 263,347 192,721 
Total revenue497,387 504,660 1,498,237 1,487,076 
Costs and expenses:
Cost of sales - services and other (exclusive of depreciation and amortization)145,189 138,179 430,553 410,515 
Cost of sales - equipment (exclusive of depreciation and amortization)74,329 62,328 213,497 161,982 
Selling, general and administrative expenses111,421 112,986 342,682 341,143 
Research and development expenses9,181 7,974 25,562 22,960 
Depreciation and amortization110,233 120,596 347,224 368,864 
Impairment of long-lived assets— — 711 245 
Total costs and expenses450,353 442,063 1,360,229 1,305,709 
Operating income (loss)47,034 62,597 138,008 181,367 
Other income (expense):
Interest income, net14,183 5,725 29,677 16,914 
Interest expense, net of amounts capitalized(13,845)(16,313)(43,125)(79,848)
Gains (losses) on investments, net(10,077)3,748 48,071 112,981 
Equity in earnings (losses) of unconsolidated affiliates, net(1,426)74 (4,441)(2,596)
Foreign currency transaction gains (losses), net(2,805)(6,641)(53)(10,045)
Other, net(319)775 2,198 (12,922)
Total other income (expense), net(14,289)(12,632)32,327 24,484 
Income (loss) before income taxes32,745 49,965 170,335 205,851 
Income tax benefit (provision), net(13,195)(19,748)(51,367)(63,047)
Net income (loss)19,550 30,217 118,968 142,804 
Less: Net loss (income) attributable to non-controlling interests2,853 3,192 8,736 6,419 
Net income (loss) attributable to EchoStar Corporation common stock$22,403 $33,409 $127,704 $149,223 
Earnings (losses) per share - Class A and B common stock:
Basic$0.27 $0.38 $1.51 $1.64 
Diluted$0.27 $0.38 $1.51 $1.64 
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ECHOSTAR CORPORATION
Consolidated Statements of Cash Flows
(Amounts in thousands)
 For the nine months ended September 30,
 20222021
Cash flows from operating activities:  
Net income (loss)$118,968 $142,804 
Adjustments to reconcile net income (loss) to cash flows provided by (used for) operating activities:  
Depreciation and amortization347,224 368,864 
Impairment of long-lived assets711 245 
Losses (gains) on investments, net(48,071)(112,981)
Equity in losses (earnings) of unconsolidated affiliates, net4,441 2,596 
Foreign currency transaction losses (gains), net53 10,045 
Deferred tax provision (benefit), net28,901 45,950 
Stock-based compensation8,401 5,913 
Amortization of debt issuance costs583 2,192 
Other, net35,609 16,691 
Changes in assets and liabilities, net: 
Trade accounts receivable and contract assets, net(63,563)(20,894)
Other current assets, net(26,402)(7,841)
Trade accounts payable657 (15,386)
Contract liabilities(13,759)30,066 
Accrued expenses and other current liabilities(27,004)(103,457)
Non-current assets and non-current liabilities, net(23,432)63,055 
Net cash provided by (used for) operating activities343,317 427,862 
Cash flows from investing activities:  
Purchases of marketable investment securities(540,447)(1,452,982)
Sales and maturities of marketable investment securities917,077 2,099,815 
Expenditures for property and equipment(249,374)(352,003)
Expenditures for externally marketed software(16,926)(25,634)
India JV formation(7,892)— 
Dividend received from unconsolidated affiliate2,000 — 
Sale of unconsolidated affiliate7,500 — 
Purchase of other investments— (50,000)
Sales of other investments3,070 10,951 
Net cash provided by (used for) investing activities115,008 230,147 
Cash flows from financing activities:
Repurchase and maturity of the 2021 Senior Unsecured Notes— (901,818)
Payment of finance lease obligations(114)(578)
Payment of in-orbit incentive obligations(2,422)(1,800)
Proceeds from Class A common stock issued under the Employee Stock Purchase Plan7,173 7,288 
Treasury share repurchase(89,303)(229,383)
Contribution by non-controlling interest holder— 9,880 
Other, net— (966)
Net cash provided by (used for) financing activities(84,666)(1,117,377)
Effect of exchange rates on cash and cash equivalents(3,123)(3,114)
Net increase (decrease) in cash and cash equivalents370,536 (462,482)
Cash and cash equivalents, including restricted amounts, beginning of period536,874 896,812 
Cash and cash equivalents, including restricted amounts, end of period$907,410 $434,330 
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