RigNet, Inc. (NASDAQ:RNET) Q3 2018 Earnings Conference Call - Final Transcript

Nov 09, 2018 • 11:00 am ET

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RigNet, Inc. (NASDAQ:RNET) Q3 2018 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good day, ladies and gentlemen, and welcome to RigNet Third Quarter 2018 Earnings Conference Call. At this time, all participants are in listen-only mode. Later, we will conduct a question-and-answer session, instruction will follow at that time. (Operator Instructions) As a reminder, this conference call is being recorded.

I would now like to turn the conference over to your host, Lee Ahlstrom, CFO, you may begin, sir.

Executive
Lee Ahlstrom

Thank you, Nicole. Good morning, everyone, and welcome to RigNet's third quarter 2018 earnings call. Copy of our earnings press release with supporting schedules, including the schedules, which reconcile the non-GAAP metrics will discuss today to GAAP metrics is posted to our website www.rig.net under our Investor Relations page. For those of you who would like the release in PDF format, we posted that as well.

(Forward-Looking Cautionary Statements)

And now I'd like to turn the call over to Steve Pickett, RigNet's Chief Executive Officer and President. Steve?

Executive
Steve Pickett

Thank you, Lee. And thank you to everyone who is joining today's call. I'm very pleased to be here in Houston with Lee, who joined us in August as our CFO. Lee has a strong background in oil and gas, has global experience, prior public company CFO experience, M&A experience and as an Engineer, who has come up to speed on our technology offerings quite quickly. Lee, welcome.

Executive
Lee Ahlstrom

Thank you. Glad to be here.

Executive
Steve Pickett

This morning, I'll open up with a general update on our progress in executing our growth strategy and I'll summarize some of the key wins we achieved during the quarter. Then Lee will go through some of the financial highlights. Following that, as always, we'll open it up for questions.

Yesterday, after the close, RigNet reported a net loss of $2.8 million or $0.15 per share, based on revenues of $64.8 million, which were up nearly 8% from the second quarter. This is our second consecutive quarter of delivering top line growth in our third consecutive quarter with improved earnings. Adjusted EBITDA, a non-GAAP measure we defined in our press release and one of our key performance metrics, was $8.7 million, up just under 8% from the second quarter. This was our second consecutive quarterly increase in adjusted EBITDA.

Revenue increased across each of our three reporting segments, both sequentially and versus the prior year period. Showing healthy activity across all three segments. We're particularly pleased with the growth in the apps and IoT segment, where revenues were up 13.5% from the second quarter and almost 50% from third quarter 2017.

Let me take a moment to remind everyone of our overall strategy, which is driving the ongoing transformation of RigNet from a company that's historically been seen as an oilfield services company, to a company that has a holistic digital transformation solutions provider. To begin with the base business, managed communication services will continue to be core to serving our global customers, who rely on us in more than 50 countries to deliver consistent and reliable communication services. As you know,