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XM Q2 Loss Grows; Settles With Satellite Insurer

XM Q2 Loss Grows; Settles With Satellite Insurer

For second quarter, XM reported quarterly revenue of $53 million – a 23% increase compared to revenue of $43 million reported in the first quarter of the year.
But the company reported a Q2 EBITDA loss of $107.8 million, compared to $95.8 million for the same period a year ago. The EBITDA figures include de-leveraging charges in the second quarters 2004 and 2003 of $35 million and $19.4 million, respectively.
In July, XM reached settlements with insurers covering 80% of the sum insured under its satellite insurance policies. Insurers have agreed to settle XM’s claims for $142 million. XM believes it will have the bulk of the money by the end of this month. It plans to begin third party resolution procedures for collecting the remaining 20%.
The Boeing 702 satellites are experiencing progressive solar array power degradation, which means XM will need to launch its ground spare sooner than originally anticipated.
The total liquidity position of XM as of June 30 was $503 million, excluding the satellite insurance settlements.