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KVH Industries Report Q1 Results, VSAT Business Growth

Maritime Activity Reports, Inc.

April 30, 2012

KVH Industries gain ground in growing maritime broadband market, VSAT business grew strongly, according to Q1 2012 results

  • Quarterly Revenue $26.7M, Up 10% Year-Over-Year
  • VSAT Business Continues to Grow Strongly; Unit Shipments Up 120% Year-Over-Year

"We had a great quarter in our satellite business," said Martin Kits van Heyningen, KVH's chief executive officer. "Revenue from the mini-VSAT business grew 61% compared to the first quarter last year, and unit sales increased 120%. Our mini-VSAT Broadband airtime revenue for the quarter was close to $7 million, and the related gross margin increased to approximately 28% from only 4% one year ago. This improvement reflects the beneficial leverage that we are achieving from the Ku-band network infrastructure, and it demonstrates the integrity of our VSAT business model."

"We were very pleased with our progress in winning a leadership position in the growing maritime broadband market," continued Mr. Kits van Heyningen. "In several customer-run, head-to-head competitions with many other maritime services, KVH mini-VSAT Broadband has been selected for large fleet-wide roll outs. We believe our mini-VSAT Broadband service is perfectly positioned as the preferred solution for customers needing reliable, fast and affordable offshore connectivity—which is why we are now recognized as the market share leader in maritime VSAT services."

In the first quarter of 2012, total mobile communications revenue was approximately $20.8 million, up 33% on a year-over-year basis. Sales of marine communications products and services other than VSAT increased 9% year-over-year, which included a 19% increase in maritime satellite TV systems. Satellite TV system sales to the leisure marine market showed some solid growth for the first time in many quarters, in part due to the initial shipments of the new TracVision HD11 system.

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