DigitalGlobe, Inc. , a provider of commercial earth imagery products and solutions, said Monday that it has entered into a $3.55 billion agreement with National Geospatial Intelligence Agency or NGA, under the EnhancedView procurement. The agreement will be effective September 1, upon expiration of its NextView Agreement and has a ten year term.
As a result of the EnhancedView Service Level Agreement, DigitalGlobe also updated its outlook for the full year 2010. In the morning trading session, the company's shares are up by 12% on the NYSE. The company collects imagery products and services through its three high-resolution imagery satellites. As per the agreement, Longmont, Colorado-based DigitalGlobe will supply satellite imagery deliveries from the WorldView satellite constellation under a Service Level Agreement for $2.8 billion and up to $750 million for value added products, infrastructure enhancements and other services.
Under the EnhancedView Service Level Agreement, the company will supply deliveries worth $250 million annually or $20.8 million per month for the first four contract years. For the remaining six years, it will increase to $300 million annually or $25 million per month. The company said it will immediately begin procurement and construction of its next satellite, WorldView-3, which is expected to be ready for launch by the end of 2014.
According to the company, the ten-year term includes nine one-year options exercisable by NGA , subject to Congressional appropriations and the right of NGA to terminate or suspend the contract at any time. The company now expects full-year 2010 earnings to be in the range of $0.40 to $0.55 per share, compared to the prior forecast of $0.25 to $0.55 per share. Total revenues for the year are now expected to be between $340 million and $360 million, compared to previous guidance of $330 million to $360 million. Eight analysts polled by Thomson Reuters expect the company to report earnings of $0.37 per share on revenues of $341.78 million for the quarter. Analysts' estimates typically exclude special items.
DGI is currently trading at $31.21, up $3.49 or 12.59%, on a volume of 825 thousand shares.