We are a leading data network infrastructure provider serving the remote communications needs of the oil and gas industry
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RigNet (RNET) $75mm IPO with a $213mm market cap at the price range mid-point of $15.
Scheduled for Wednesday, December 15, 2010 |
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SUMMARY |
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. Revenue up 13% to $69mm for the nine months ended September 30, 1020 compare to the year earlier period, comparable EBIDTDA down $2mm to 30%
. Only 12% operating income for the nine months ended September 30, 2010
. Low grade & score: C and 6 |
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BUSINESS |
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. Data network infrastructure provider serving the remote communications needs of the oil and gas industry.
. Turnkey solutions simplify the management of communications services, freeing customers to focus attention on their core drilling and production operations. |
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. Through a controlled and managed Internet Protocol/Multiprotocol Label Switching global network, delivers voice, data, video and other value-added services such as real-time management and telemedicine services, under a multi-tenant model. |
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COMPETITION |
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. Primary global competitors include CapRock Communications, Inc., recently acquired by Harris Corporation, Schlumberger Ltd’s Global Connectivity Services division, which Harris Corporation recently announced the entry into a definitive agreement to acquire, and the Broadband Division of Inmarsat plc’s subsidiary Stratos Global Corporation.
. In addition, there are a number of regional competitors in each local market. Onshore, RNET also faces competition from: drilling instrumentation providers; living quarters companies; and other pure-play providers like us. |
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USE OF PROCEEDS , $45mm |
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From sale of 3.3mmshares, shareholders intend to sell 1.7mm shares |
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$400,000 for bonuses, balance for general corporate purposes |
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RigNet |
RNET, C, 6 |
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Post IPO shares: 14mm |
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Data network infrastr |
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Houston, TX, |
2007 |
2008 |
2009 |
Sept9mos09 |
Sept9mos10 |
IPO Mkt |
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Revenues ($mm) |
$67 |
$90 |
$81 |
$61 |
$69 |
Cap (mm) |
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Operating income % |
8% |
18% |
14% |
15% |
12% |
$213 |
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Change in fair value of preferred stock derivatives |
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@$15 |
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% of revenue |
-2% |
3% |
-26% |
-23% |
-18% |
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Net income (loss) |
-$3.2 |
-$8.4 |
-$20.0 |
-$13.0 |
-$11.0 |
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Net income % of rev |
-5% |
-9% |
-25% |
-21% |
-16% |
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Adj EBITDA |
$18 |
$34 |
$29 |
$23 |
$21 |
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Adj EBITDA % of revenue |
26% |
38% |
36% |
38% |
30% |
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Valuation Ratios |
IPO Mrkt |
Price / |
Price / |
Price / |
Price / |
% offered |
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annualizing Sept 9 mos |
Cap (mm) |
Sales |
Earnings |
BookValue |
TangibleBV |
in IPO |
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RigNet (RNET) |
$213 |
2.3 |
-15 |
2.7 |
3.3 |
35% |
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SCORECARD |
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Mgt |
Market |
Market Do- |
Proprie- |
Total |
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1-5, 5 is high |
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Growth |
mination |
tary |
rating |
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20 is perfect |
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2 |
2 |
1 |
1 |
6 |
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