Inmarsat investors spooked by gloomy outlook
Nearly a fifth was wiped off the market value of Inmarsat after it spooked investors with a gloomy outlook for its maritime business.
The satellite company has been upgrading its shipping customers from old-fashioned terminals with a slow Internet connection to broadband.
The faster connection means sailors are spending less time on the new terminals, cutting their bills and hitting Inmarsat’s business.
Spooked: Nearly a fifth was wiped off the market value of Inmarsat after it spooked investors with a gloomy outlook for its maritime business
The company believes sailors will eventually increase the time they are using the Internet in response to the faster speed.
But in the meantime the migration to the new terminals, which has been quicker than expected, is likely to hurt its maritime business for the rest of this year and early next year.
The company cut its 2011 growth forecast for its core business to flat and shares in Inmarsat lost 94.4p to 394.8p.
The fall occurred despite the fact the company reported half year pre-tax profits up 68 per cent to £156million and lifted its interim dividend by 10 per cent to 9.5p.
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