KVH reports loss, revenue decline in 2016, 4Q

KVH INDUSTRIES INC. reported losses in 2016 and the fourth quarter.
KVH INDUSTRIES INC. reported losses in 2016 and the fourth quarter.

MIDDLETOWN – KVH Industries Inc. reported a loss and a nearly 5 percent decline in revenue in 2016, according to a company earnings statement released Thursday.
KVH, which makes technology that provides global high-speed internet, television and voice services via satellite to mobile users at sea and on land, as well as high-performance sensors for defense and commercial applications, said it had a $7.5 million loss last year, or 47 cents per share, compared with profit of $2.3 million, or 14 cents a share, a year earlier.

Revenue fell to $176.1 million from $184.6 million in 2015.

The company blamed weakness in the British pound in part for its lower revenue, along with a 5 percent decrease in mobile connectivity product sales and a 3 percent decline in navigation product sales.

The yearly loss includes $6.8 million of non-cash discrete tax reserves, which the company said “represents a change in the valuation allowance on a state research and development tax credit, uncertain tax position adjustments, provision to return adjustments, United States net operating losses, and penalties.”

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In the fourth quarter, KVH had a $6.8 million loss, or 43 cents per share, compared with profit of $4.1 million, or 26 cents a share, in fourth quarter of 2015. Revenue fell to $43.9 million in the quarter, a decline of 18.7 percent from 2015 fourth quarter revenue of $54 million.

“We are generally pleased with our fourth-quarter results having met the high end of, or exceeded, our most recent guidance at almost every level. In 2017, we will be investing in key strategic initiatives such as low-cost fiber optic gyros for self-driving cars and new high-throughput satellite services for the maritime market that have the potential to transform the company going forward. We are taking a more conservative view with respect to near-term TACNAV revenue guidance, but we continue to be extremely optimistic about this part of our business as well,” Martin Kits van Heyningen, KVH’s CEO, said in a statement.

Going forward, KVH said in the release that it expects 2017 will be a year of “strategic investment” which will result in “significant revenue growth in 2018 and beyond.” It plans to roll out a new commercial maritime subscription program and also enhance its TACNAV technology to support military demand. KVH said little benefit from these initiatives are expected to be realized this year, however.

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