Iridium Communications Inc. 2012 Annual Report Company Profile CORPORATE HEADQUARTERS 1750 Tysons Boulevard, Suite 1400 McLean, Virginia 22102 (703) 287-7400 www.iridium.com BUSINESS OPERATIONS 8440 South River Parkway Tempe, AZ 85284 (480) 752-1100 The world’s only truly global mobile satellite communications company. Iridium Communications Inc. owns the only mobile voice and data satellite communications network that spans the entire globe. A technology innovator and market leader, Iridium® enables Iridium Communications Inc. Inc. Iridium Communications connections between people, organizations and assets to and We bring you the world. from anywhere, in real time. Iridium's 66 low-Earth orbiting (LEO) cross-linked satellites – the world's largest commercial constellation – operate as a fully meshed network that is supported by multiple in-orbit spares. The company has a major development program underway for 2012 Annual Report 2012 its next-generation network – Iridium NEXT. Reaching over oceans, through airways and across the polar regions, Iridium solutions are ideally suited for industries such as maritime, aviation, emergency services, mining, forestry, oil and gas, heavy equipment, transportation and utilities. Iridium also provides service to subscribers from the U.S. Department of Defense, as well as other civil and government agencies around the world. Together with its ever-expanding ecosystem of partner companies, Iridium delivers an innovative and rich portfolio Only one communications company connects the entire globe of reliable solutions for markets that require truly Iridium is the world’s only truly global mobile communications company, with coverage of the entire Earth, including oceans, airways and polar regions. Iridium voice and data products provide global communications. communications solutions that allow global companies, government agencies and individuals to stay connected, everywhere. The unique Iridium constellation of 66 Low Earth Orbiting (LEO) cross-linked satellites routes communications traffic through space and around the world, creating highly efficient and reliable connections. www.iridium.com RELIABLE • CRITICAL • LIFELINES® © Copyright 2013 Iridium Communications Inc. All rights reserved. Iridium is a registered mark of Iridium Satellite LLC. All other RELIABLE • CRITICAL • LIFELINES® trademarks and service marks are the property of their respective holders. Information is subject to change without notice. 03/13 Iridium Communications Inc. 2012 Annual Report Company Profile CORPORATE HEADQUARTERS 1750 Tysons Boulevard, Suite 1400 McLean, Virginia 22102 (703) 287-7400 www.iridium.com BUSINESS OPERATIONS 8440 South River Parkway Tempe, AZ 85284 (480) 752-1100 The world’s only truly global mobile satellite communications company. Iridium Communications Inc. owns the only mobile voice and data satellite communications network that spans the entire globe. A technology innovator and market leader, Iridium® enables Iridium Communications Inc. Inc. Iridium Communications connections between people, organizations and assets to and We bring you the world. from anywhere, in real time. Iridium's 66 low-Earth orbiting (LEO) cross-linked satellites – the world's largest commercial constellation – operate as a fully meshed network that is supported by multiple in-orbit spares. The company has a major development program underway for 2012 Annual Report 2012 its next-generation network – Iridium NEXT. Reaching over oceans, through airways and across the polar regions, Iridium solutions are ideally suited for industries such as maritime, aviation, emergency services, mining, forestry, oil and gas, heavy equipment, transportation and utilities. Iridium also provides service to subscribers from the U.S. Department of Defense, as well as other civil and government agencies around the world. Together with its ever-expanding ecosystem of partner companies, Iridium delivers an innovative and rich portfolio Only one communications company connects the entire globe of reliable solutions for markets that require truly Iridium is the world’s only truly global mobile communications company, with coverage of the entire Earth, including oceans, airways and polar regions. Iridium voice and data products provide global communications. communications solutions that allow global companies, government agencies and individuals to stay connected, everywhere. The unique Iridium constellation of 66 Low Earth Orbiting (LEO) cross-linked satellites routes communications traffic through space and around the world, creating highly efficient and reliable connections. www.iridium.com RELIABLE • CRITICAL • LIFELINES® © Copyright 2013 Iridium Communications Inc. All rights reserved. Iridium is a registered mark of Iridium Satellite LLC. All other RELIABLE • CRITICAL • LIFELINES® trademarks and service marks are the property of their respective holders. Information is subject to change without notice. 03/13 Financial Highlights Corporate Information 2013 ANNUAL MEETING Who is Iridium? (in millions, except for subscriber data) 2008 2009 2010 2011 2012 The Annual Meeting of Stockholders will be held on May 9, 2013 at 8:30 a.m. local time at Iridium Communications’ Headquarters: • We compete in attractive and growing markets with favorable Iridium Communications Inc. 1750 Tysons Boulevard, Suite 1400, McLean, VA 22102 competitive dynamics and high barriers to entry. Revenue $320.9 $318.9 $348.2 $384.3 $383.5 Service $184.9 $213.2 $236.4 $262.3 $273.5 BOARD OF DIRECTORS EXECUTIVE OFFICERS Subscriber Equipment $119.9 $ 83.5 $ 90.2 $ 94.7 $ 93.9 • We operate the world’s furthest reaching telecommunications Robert H. Niehaus Alvin B. Krongard Matthew J. Desch Engineering and Support Service $ 16.1 $ 22.2 $ 21.6 $ 27.3 $ 16.2 network with 100% global coverage. Our current satellite Chairman of the Board Former Chairman of the Board and Chief Executive Officer Net Income $ 53.9 $ 48.3 $ 19.9 $ 41.0 $ 64.6 constellation is healthy, and our unique network architecture Chairman, GCP Capital Partners Chief Executive Officer, Operational EBITDA (OEBITDA)* $111.1 $133.9 $158.9 $190.4 $205.7 Thomas J. Fitzpatrick Holdings LLC Alex. Brown Incorporated provides a sustainable competitive advantage. We have a fully Subscribers 308,000 342,000 427,000 523,000 611,000 Chief Financial Officer J. Darrel Barros Admiral Eric T. Olson (Ret.) funded business plan for our next-generation satellite constellation, Capital Expenditures $13.9 $7.4 $237.5 $359.4 $411.7 Bryan J. Hartin President, Syndicated Communications, Inc. President and Managing Member, Iridium NEXT. Net Debt NMF NMF $037.4 $253.8 $443.1 Executive Vice President, ETO Group, LLC Scott L. Bok Sales and Marketing, Iridium Satellite Former Commander, We benefit from a large, low-cost and growing ecosystem of Commercial Chief Executive Officer, Greenhill & Co., Inc. • U.S. Special Operations Command Thomas D. Hickey partners, a robust product portfolio and a large, highly profitable Service Revenue $132.4 $159.5 $177.4 $198.0 $211.7 Thomas C. Canfield Chief Legal Officer Voice and Data $121.1 $143.0 $155.6 $167.5 $171.0 Steven B. Pfeiffer recurring service revenue base. Senior Vice President and General Counsel, M2M Data $011.3 $016.5 $021.8 $030.5 $040.8 Partner, Fulbright & Jaworski LLP Richard P. Nyren Spirit Airlines, Inc. Subscribers 277,000 308,000 384,000 475,000 560,000 Vice President and Corporate Controller, • We expect that our operating margins will continue to expand Parker W. Rush Voice and Data 218,000 238,000 272,000 307,000 332,000 Brig. Gen. Peter M. Dawkins (Ret.) Iridium Satellite and we’ll grow operating cash flow due to the operating leverage Chief Executive Officer, M2M Data 59,000 70,000 112,000 168,000 228,000 Principal, ShiningStar Capital LLC created by an increasing recurring service revenue base and ClearView Risk Holdings, LLC John M. Roddy Matthew J. Desch Executive Vice President, Quality and largely fixed-cost business model. Government Service Revenue $052.5 $053.7 $059.0 $064.3 $061.8 Chief Executive Officer Global Operations, Iridium Satellite Voice and Data $052.2 $053.0 $057.5 $062.0 $058.9 Scott T. Scheimreif 2012 Operating Highlights M2M Data $000.3 $000.7 $001.5 $002.3 $002.9 Executive Vice President, Subscribers 31,000 34,000 43,000 48,000 51,000 Government Programs, Iridium Satellite • Generated 2012 Net Income of $65 million, a 58% year-over-year Voice and Data 29,000 30,000 36,000 37,000 36,000 S. Scott Smith increase. Produced Operational EBITDA (OEBITDA)* of $206 million, M2M Data 2,000 4,000 7,000 11,000 15,000 Executive Vice President, Technology resulting in a five-year compound annual growth rate of 17%. * See inside back cover and Investor Relations webpage at www.iridium.com for a discussion and reconciliation of this and other non-GAAP financial measures. Development and Satellite Operations • Surpassed 600,000 worldwide subscribers, a five-year compound Donald L. Thoma annual growth rate of 19%. Robust Subscriber Growth Revenue Quality Significant Operating Leverage President and Chief Executive Officer, subscribers in thousands dollars in millions dollars in millions Aireon LLC GENERAL INFORMATION INVESTOR INFORMATION • M2M data subscribers have grown at a 41% compound annual 700 450 225 60% 2008 - 2012 OEBITDA CAGR: 17% Transfer Agent and Registrar Stock Exchange Investor Inquiries growth rate since 2008, and now represent 40% of our total 2008- 2012 Subscriber Growth CAGR: 19% 400 2008 - 2012 Service Revenue CAGR: 10% 200 customer base.