EX-99.1 7 pressrelease2022-exx991.htm EX-99.1 Document
Exhibit 99.1

EchoStar Announces Financial Results for the Three and Twelve Months Ended December 31, 2022

Englewood, CO, February 22, 2023—EchoStar Corporation (NASDAQ: SATS) announced its financial results for the three and twelve months ended December 31, 2022.

Three Months Ended December 31, 2022 Financial Highlights:

•Consolidated revenue of $499.9 million.
•Net income of $47.6 million, consolidated net income attributable to EchoStar common stock of $49.3 million, and basic and diluted earnings per share of common stock of $0.59
•Consolidated Adjusted EBITDA of $163.6 million (see discussion and the reconciliation of GAAP to this non-GAAP measure below).

Twelve Months Ended December 31, 2022 Financial Highlights:

•Consolidated revenue of $2.0 billion.
•Net income of $166.5 million, consolidated net income attributable to EchoStar common stock of $177.1 million, and basic and diluted earnings per share of common stock of $2.10.
•Consolidated Adjusted EBITDA of $656.0 million (see discussion and the reconciliation of GAAP to this non-GAAP measure below).

“The EchoStar team finished 2022 with a solid performance, continuing to optimize operations and asset yields,” said Hamid Akhavan, CEO and President of EchoStar. “In the near term, we remain focused on operating the business in an efficient manner and preparing for the launch of our upcoming EchoStar XXIV/JUPITER 3 satellite as a catalyst for new growth. We have also made tangible strides toward expanding our future capabilities as we begin construction on a global S-band mobile satellite service network.”

Three Months Ended December 31, 2022 - Additional Information:

•Consolidated revenue increased year over year. Higher equipment sales of $33.1 million to our domestic and international enterprise customers was offset by lower service revenues of $31.9 million, primarily due to lower broadband consumer customers.
•Adjusted EBITDA increased 2.5% or $4.0 million year over year.
◦Hughes segment Adjusted EBITDA increased $4.2 million year over year. The increase was driven primarily by lower sales and marketing expense for our broadband consumer business.
◦ESS segment Adjusted EBITDA increased $2.1 million year over year primarily due to higher revenue.
◦Corporate and Other segment Adjusted EBITDA decreased $2.3 million year over year. The decrease was primarily due to higher corporate expenses, partially offset by higher earnings of unconsolidated affiliates, net, of $1.3 million.
•Net income increased $127.7 million year over year. The increase was primarily due to higher operating income of $16.0 million, a favorable change in net interest expense of $17.0 million, a favorable change in investments of $42.5 million, and $55.3 million related to the impairment of our Dish Mexico equity investment that occurred in 2021. These items were partially offset by higher net income tax expense of $12.7 million.
•Hughes broadband subscribers totaled approximately 1,228,000, declining 57,000 from September 30, 2022. Our current capacity limitations and increased competitive pressures are impacting our consumer subscriber levels. In Latin America, subscriber levels were also
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impacted by adverse economic conditions and capacity allocation to community WiFi and enterprise opportunities.
•For the three months ended December 31, 2022, approximately 42% of Hughes segment revenue was attributable to our enterprise customers, increasing from 35% in the same period last year. The increase supports our strong focus on our enterprise business and diversification objectives.
•Cash, cash equivalents and current marketable investment securities were $1.7 billion as of December 31, 2022.
•The Jupiter 3/EchoStar XXIV satellite is expected to be launched during the second quarter of 2023.
Set forth below is a table highlighting certain of EchoStar’s segment results for the three and twelve months ended December 31, 2022 and 2021 (amounts in thousands) (all US GAAP amounts reference results from operations):
For the three months ended December 31,For the twelve months ended December 31,
 2022202120222021
Revenue
Hughes
$491,075 $491,154 $1,966,587 $1,956,226 
EchoStar Satellite Services
6,228 $4,871 20,533 $17,679 
Corporate and Other
2,553 $2,619 10,973 $11,815 
Total revenue
$499,856 $498,644 $1,998,093 $1,985,720 
Adjusted EBITDA
Hughes
$182,467 $178,218 $726,752 $790,469 
EchoStar Satellite Services
4,757 $2,704 14,416 $9,185 
Corporate & Other:
Corporate overhead, operating and other
(24,235)$(20,675)(86,502)$(82,615)
Equity in earnings (losses) of unconsolidated affiliates, net
561 $(723)1,320 $1,892 
Total Corporate & Other
(23,674)$(21,398)(85,182)$(80,723)
Total Adjusted EBITDA
$163,550 $159,524 $655,986 $718,931 
Net income (loss)$47,580 $(80,083)$166,548 $62,721 
Expenditures for property and equipment
$76,517 $86,427 $325,891 $438,430 

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Reconciliation of GAAP to Non-GAAP Measurement (amounts in thousands):
For the three months ended December 31,For the twelve months ended December 31,
2022202120222021
Net income (loss)$47,580 $(80,083)$166,548 $62,721 
Interest income, net(21,223)(5,887)(50,900)(22,801)
Interest expense, net of amounts capitalized14,045 15,664 57,170 95,512 
Income tax provision (benefit), net15,308 2,579 66,675 65,626 
Depreciation and amortization110,397 122,465 457,621 491,329 
Net loss (income) attributable to non-controlling interests1,767 3,735 10,503 10,154 
EBITDA
167,874 58,473 707,617 702,541 
(Gains) losses on investments, net
964 43,450 (47,107)(69,531)
Impairment of long-lived assets— — 711 245 
Impairment loss on equity method investment— 55,266 — 55,266 
Litigation Expense— — — 16,800 
License fee dispute - India, net of non-controlling interests
— (233)— (941)
Loss on Debt Repurchase— — — 1,938 
Foreign currency transaction (gains) losses, net
(5,288)2,568 (5,235)12,613 
Adjusted EBITDA
$163,550 $159,524 $655,986 $718,931 

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 December 31, 2022 are attached to this press release. Detailed financial data and other information are available in EchoStar’s Annual Report on Form 10-K for the period ended December 31, 2022 filed today with the Securities and Exchange Commission.

EchoStar will host a conference call to discuss its earnings on Thursday, February 23, 2023 at 1:00 p.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/BIa7c9b243b8424fd3af6e63301e48fac6.


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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, 2022 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 December 31,
 20222021
Assets  
Current assets:  
Cash and cash equivalents$704,541 $535,894 
Marketable investment securities973,915 1,010,496 
Trade accounts receivable and contract assets, net236,479 182,063 
Other current assets, net210,446 198,444 
Total current assets2,125,381 1,926,897 
Non-current assets:  
Property and equipment, net2,237,617 2,338,285 
Operating lease right-of-use assets151,518 149,198 
Goodwill532,491 511,086 
Regulatory authorizations, net462,531 469,766 
Other intangible assets, net15,698 13,984 
Other investments, net356,705 297,747 
Other non-current assets, net317,062 338,241 
Total non-current assets4,073,622 4,118,307 
Total assets$6,199,003 $6,045,204 
Liabilities and Stockholders' Equity  
Current liabilities:  
Trade accounts payable$101,239 $109,338 
Contract liabilities121,739 141,343 
Accrued expenses and other current liabilities199,853 209,442 
Total current liabilities422,831 460,123 
Non-current liabilities:  
Long-term debt, net1,496,777 1,495,994 
Deferred tax liabilities, net424,621 403,684 
Operating lease liabilities135,932 134,897 
Other non-current liabilities119,787 136,426 
Total non-current liabilities2,177,117 2,171,001 
Total liabilities2,599,948 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 December 31, 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 December 31, 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 December 31, 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 December 31, 2022 and December 31, 2021
— — 
Class D common stock, $0.001 par value, 800,000,000 shares authorized, none issued and outstanding at both December 31, 2022 and December 31, 2021
— — 
Additional paid-in capital3,367,058 3,345,878 
Accumulated other comprehensive income (loss)(172,239)(212,102)
Accumulated earnings (losses)833,517 656,466 
Treasury shares, at cost, 23,313,311 and 19,332,699 shares at December 31, 2022 and 2021, respectively
(525,824)(436,521)
Total EchoStar Corporation stockholders' equity3,502,619 3,353,827 
Non-controlling interests96,436 60,253 
Total stockholders' equity3,599,055 3,414,080 
Total liabilities and stockholders' equity$6,199,003 $6,045,204 
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ECHOSTAR CORPORATION
Consolidated Statements of Operations
(Amounts in thousands, except per share amounts)

 For the years ended December 31,
 202220212020
Revenue:
Services and other revenue$1,623,931 $1,715,287 $1,682,304 
Equipment revenue374,162 270,433 205,603 
Total revenue1,998,093 1,985,720 1,887,907 
Costs and expenses:
Cost of sales - services and other (exclusive of depreciation and amortization)569,755 551,679 577,943 
Cost of sales - equipment (exclusive of depreciation and amortization)292,318 231,975 166,435 
Selling, general and administrative expenses455,234 461,705 474,912 
Research and development expenses32,810 31,777 29,448 
Depreciation and amortization457,621 491,329 525,011 
Impairment of long-lived assets711 245 1,685 
Total costs and expenses1,808,449 1,768,710 1,775,434 
Operating income (loss)189,644 217,010 112,473 
Other income (expense):
Interest income, net50,900 22,801 39,982 
Interest expense, net of amounts capitalized(57,170)(95,512)(147,927)
Gains (losses) on investments, net47,107 69,531 (31,306)
Equity in earnings (losses) of unconsolidated affiliates, net(5,703)(5,170)(7,267)
Foreign currency transaction gains (losses), net5,235 (12,613)6,015 
Other-than-temporary impairment losses on equity method investments— (55,266)— 
Other, net3,210 (12,434)195 
Total other income (expense), net43,579 (88,663)(140,308)
Income (loss) before income taxes233,223 128,347 (27,835)
Income tax benefit (provision), net(66,675)(65,626)(24,069)
Net income (loss)166,548 62,721 (51,904)
Less: Net loss (income) attributable to non-controlling interests10,503 10,154 11,754 
Net income (loss) attributable to EchoStar Corporation common stock$177,051 $72,875 $(40,150)
Earnings (losses) per share - Class A and B common stock:
Basic$2.10 $0.81 $(0.41)
Diluted$2.10 $0.81 $(0.41)
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ECHOSTAR CORPORATION
Consolidated Statements of Cash Flows
(Amounts in thousands)
 For the years ended December 31,
 202220212020
Cash flows from operating activities:  
Net income (loss)$166,548 $62,721 $(51,904)
Adjustments to reconcile net income (loss) to cash flows provided by (used for) operating activities:  
Depreciation and amortization457,621 491,329 525,011 
Impairment of long-lived assets711 245 1,685 
Losses (gains) on investments, net(47,107)(69,531)31,306 
Equity in losses (earnings) of unconsolidated affiliates, net5,703 5,170 7,267 
Foreign currency transaction losses (gains), net(5,235)12,613 (6,015)
Deferred tax provision (benefit), net21,430 37,664 18,147 
Stock-based compensation11,546 7,699 8,887 
Amortization of debt issuance costs783 2,381 4,324 
Other-than-temporary impairment losses on equity method investments— 55,266 — 
Other, net(3,711)19,740 (12,501)
Changes in assets and liabilities, net: 
Trade accounts receivable and contract assets, net(50,959)(2,334)2,237 
Other current assets, net(6,456)(7,303)(12,984)
Trade accounts payable8,825 (15,599)(12,339)
Contract liabilities(19,604)36,774 3,509 
Accrued expenses and other current liabilities(3,649)(84,621)42,822 
Non-current assets and non-current liabilities, net(6,841)80,012 (15,064)
Net cash provided by (used for) operating activities529,605 632,226 534,388 
Cash flows from investing activities:  
Purchases of marketable investment securities(1,067,461)(1,651,608)(2,799,838)
Sales and maturities of marketable investment securities1,136,594 2,321,560 2,110,336 
Expenditures for property and equipment(325,891)(438,430)(408,798)
Expenditures for externally marketed software(23,105)(33,543)(38,655)
India JV formation(7,892)— — 
Dividend received from unconsolidated affiliate2,000 — — 
Sale of unconsolidated affiliate7,500 — — 
Purchase of other investments— (50,000)(5,500)
Sales of other investments3,070 10,951 — 
Net cash provided by (used for) investing activities(275,185)158,930 (1,142,455)
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Cash flows from financing activities:
Repurchase and maturity of the 2021 Senior Unsecured Notes— (901,818)— 
Payment of finance lease obligations(120)(670)(811)
Payment of in-orbit incentive obligations(2,988)(2,214)(1,554)
Proceeds from Class A common stock options exercised— 408 855 
Proceeds from Class A common stock issued under the Employee Stock Purchase Plan9,306 9,471 10,109 
Treasury share repurchase(89,303)(261,436)(43,458)
Contribution by non-controlling interest holder— 9,880 18,241 
Other, net— (966)998 
Net cash provided by (used for) financing activities(83,105)(1,147,345)(15,620)
Effect of exchange rates on cash and cash equivalents(2,306)(3,749)(1,390)
Net increase (decrease) in cash and cash equivalents169,009 (359,938)(625,077)
Cash and cash equivalents, including restricted amounts, beginning of period536,874 896,812 1,521,889 
Cash and cash equivalents, including restricted amounts, end of period$705,883 $536,874 $896,812 
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