GeoEye Posts Loss for Q1; Loses OrbView-3 and Pushes out Launch of GeoEye-1
GeoEye (GEOY) would have posted a profit for Q1 but decided to write down the loss of OrbView-3 in the quarter as the earth orbiting satellite was deemed inoperable on April 23rd. The company tried to repair the satellite but to no avail and is now seeking to exercise a $40 million insurance policy on the satellite.
The company also reported fewer sales to NGA during the quarter, its biggest and most important customer, but did announce that NGA had renewed its contract on February 1st in addition to securing a contract with the USDA. These contracts totalled $23 million for the quarter. In March, GeoEye completed the acquisition of MJ Harden and its two mapping aircraft from General Electric.
GeoEye announced earlier this year that it had secured Beijing Earth Observation (BEO), a new company formed by the East Dawn Group, as its master reseller for China. GeoEye will sell only images of China to China through BEO and hopes that this partnership will allow them greater insight into the market for satellite imagery in China. Archived IKONOS imagery is the primary product sold through BEO.
GeoEye also announced that it has again been forced to delay the launch of GeoEye-1 due to the high demand for launch facilities at Vandenburg Air Force Base. At this time, the company feels that it is likely that the launch will be delayed two months and forced into some time window between October and December 2007. However, the installation of the GeoEye-1 camera into the spacecraft bus has now been completed allowing General Dynamics, the satellite contractor, the ability to complete all required testing prior to launch.