Cover Page
Cover Page - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Mar. 26, 2021 | Jun. 30, 2020 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2020 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-35878 | ||
Entity Registrant Name | INTELSAT S.A. | ||
Entity Incorporation, State or Country Code | N4 | ||
Entity Tax Identification Number | 98-1009418 | ||
Entity Address, Address Line One | 4 rue Albert Borschette | ||
Entity Address, Postal Zip Code | L-1246 | ||
Entity Address, City or Town | Luxembourg | ||
Entity Address, Country | LU | ||
City Area Code | 27 84 | ||
Local Phone Number | 1600 | ||
Title of 12(g) Security | Common Shares, nominal value $0.01 per share | ||
Trading Symbol | INTEQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 50.2 | ||
Entity Common Stock, Shares Outstanding | 142,184,518 | ||
Documents Incorporated by Reference | Specified portions of the registrant’s proxy statement with respect to the registrant’s 2021 Annual Meeting of Shareholders, which is to be filed pursuant to Regulation 14A within 120 days after the end of the registrant’s fiscal year ended December 31, 2020, are incorporated by reference into Part III of this Annual Report on Form 10-K. | ||
Entity Central Index Key | 0001525773 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 1,060,917 | $ 810,626 |
Restricted cash | 21,130 | 20,238 |
Receivables, net of allowances of $40,028 in 2019 and $40,785 in 2020 | 659,444 | 255,722 |
Contract assets | 39,774 | 47,721 |
Inventory | 147,094 | 430 |
Prepaid expenses and other current assets | 136,611 | 38,800 |
Total current assets | 2,064,970 | 1,173,537 |
Satellites and other property and equipment, net | 4,757,877 | 4,702,063 |
Goodwill | 2,698,247 | 2,620,627 |
Non-amortizable intangible assets | 2,295,000 | 2,452,900 |
Amortizable intangible assets, net | 290,569 | 276,752 |
Contract assets, net of current portion | 86,017 | 74,109 |
Other assets | 605,001 | 504,394 |
Total assets | 12,797,681 | 11,804,382 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 252,998 | 88,107 |
Taxes payable | 7,493 | 6,402 |
Employee related liabilities | 43,404 | 44,648 |
Accrued interest payable | 17,747 | 308,657 |
Current maturities of long-term debt | 5,903,724 | 0 |
Contract liabilities | 157,320 | 137,706 |
Deferred satellite performance incentives | 47,377 | 42,835 |
Other current liabilities | 73,479 | 62,446 |
Total current liabilities | 6,503,542 | 690,801 |
Long-term debt | 0 | 14,465,483 |
Contract liabilities, net of current portion | 1,447,891 | 1,113,450 |
Deferred satellite performance incentives, net of current portion | 138,116 | 175,837 |
Deferred income taxes | 61,345 | 55,171 |
Accrued retirement benefits, net of current portion | 129,837 | 125,511 |
Other long-term liabilities | 262,900 | 166,977 |
Liabilities subject to compromise | 10,168,518 | 0 |
Shareholders’ deficit: | ||
Common shares; nominal value $0.01 per share | 1,421 | 1,411 |
Paid-in capital | 2,573,840 | 2,565,696 |
Accumulated deficit | (8,416,410) | (7,503,830) |
Accumulated other comprehensive loss | (80,322) | (63,135) |
Total Intelsat S.A. shareholders’ deficit | (5,921,471) | (4,999,858) |
Noncontrolling interest | 7,003 | 11,010 |
Total liabilities and shareholders’ deficit | $ 12,797,681 | $ 11,804,382 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2020 | May 20, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | |||
Receivables, allowances | $ 40,785 | $ 40,028 | |
Common shares, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Statement [Abstract] | |||
Revenue | $ 1,913,080 | $ 2,061,465 | $ 2,161,190 |
Operating expenses: | |||
Direct costs of revenue (excluding depreciation and amortization) | 450,823 | 406,153 | 330,874 |
Selling, general and administrative | 314,229 | 226,918 | 200,857 |
Depreciation and amortization | 653,447 | 658,233 | 687,589 |
Satellite impairment loss | 0 | 381,565 | 0 |
Impairment of non-amortizable intangible and other assets | 191,943 | 0 | 0 |
Other operating expense—C-band | 33,642 | 0 | 0 |
Total operating expenses | 1,644,084 | 1,672,869 | 1,219,320 |
Income from operations | 268,996 | 388,596 | 941,870 |
Interest expense, net | 813,603 | 1,273,112 | 1,212,374 |
Loss on early extinguishment of debt | 0 | 0 | (199,658) |
Other income (expense), net | 14,142 | (34,078) | 4,541 |
Reorganization items | (385,861) | 0 | 0 |
Loss before income taxes | (916,326) | (918,594) | (465,621) |
Provision for (benefit from) income taxes | (7,055) | (7,384) | 130,069 |
Net loss | (909,271) | (911,210) | (595,690) |
Net income attributable to noncontrolling interest | (2,393) | (2,385) | (3,915) |
Net loss attributable to Intelsat S.A. | $ (911,664) | $ (913,595) | $ (599,605) |
Net loss per common share attributable to Intelsat S.A.: | |||
Basic (in dollars per share) | $ (6.42) | $ (6.51) | $ (4.63) |
Diluted (in dollars per share) | $ (6.42) | $ (6.51) | $ (4.63) |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | |||
Net loss | $ (909,271) | $ (911,210) | $ (595,690) |
Defined benefit retirement plans: | |||
Reclassification adjustment for amortization of unrecognized prior service credits, net of tax included in other income (expense), net of tax | (2,504) | (2,502) | (839) |
Reclassification adjustment for amortization of unrecognized actuarial loss, net of tax included in other income (expense), net of tax | 5,096 | 2,943 | 4,064 |
Actuarial and other gain (loss) arising during the year, net of tax of $(0.3) million in 2020 | (19,779) | (3,955) | 2,960 |
Benefit plan amendment, net of tax of $0.7 million | 0 | 0 | 38,510 |
Adoption of ASU 2018-02 (see Note 15—Income Taxes) | 0 | (16,191) | 0 |
Marketable securities: | |||
Reclassification adjustment for pension assets' gains, net of tax included in other income (expense), net of tax | 0 | 0 | (351) |
Other comprehensive income (loss) | (17,187) | (19,705) | 44,344 |
Comprehensive loss | (926,458) | (930,915) | (551,346) |
Comprehensive income attributable to noncontrolling interest | (2,393) | (2,385) | (3,915) |
Comprehensive loss attributable to Intelsat S.A. | $ (928,851) | $ (933,300) | $ (555,261) |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Loss (Parenthetical) $ in Millions | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Statement of Comprehensive Income [Abstract] | |
Actuarial gain (loss), tax benefit | $ (0.3) |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Deficit - USD ($) $ in Thousands, shares in Millions | Total | Common | Paid-in Capital | Accumulated Deficit | Accumulated DeficitCumulative Effect, Period of Adoption, Adjustment | Accumulated Other Comprehensive Loss | Total Intelsat S.A. Shareholders’ Deficit | Total Intelsat S.A. Shareholders’ DeficitCumulative Effect, Period of Adoption, Adjustment | Noncontrolling Interest |
Balance (in shares) at Dec. 31, 2017 | 119.6 | ||||||||
Beginning balance at Dec. 31, 2017 | $ 1,196 | $ 2,173,367 | $ (5,894,659) | $ (87,774) | $ (3,807,870) | $ 19,306 | |||
Beginning balance (Adoption of ASU 2014-09) at Dec. 31, 2017 | $ (281,741) | $ (281,741) | |||||||
Beginning balance (Adoption of ASU 2016-16) at Dec. 31, 2017 | 169,579 | 169,579 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income (loss) | $ (599,605) | (599,605) | (599,605) | 3,915 | |||||
Dividends paid to noncontrolling interests | (8,825) | ||||||||
Share-based compensation (in shares) | 2.9 | ||||||||
Share-based compensation | $ 29 | 10,006 | 10,035 | ||||||
Equity offering and 2025 Convertible Notes offering (in shares) | 15.5 | ||||||||
Equity offering and 2025 Convertible Notes offering | $ 155 | 368,098 | 368,253 | ||||||
Postretirement/pension liability adjustment, net of tax | 6,185 | 6,185 | |||||||
Benefit plan amendment, net of tax of $0.7 million | 38,510 | 38,510 | 38,510 | ||||||
Adoption of ASU 2018-02 (see Note 15—Income Taxes) | 0 | ||||||||
Other comprehensive income, net of tax of $(0.2) million | 351 | (351) | (351) | ||||||
Balance (in shares) at Dec. 31, 2018 | 138 | ||||||||
Ending balance at Dec. 31, 2018 | $ 1,380 | 2,551,471 | (6,606,426) | (43,430) | (4,097,005) | 14,396 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income (loss) | (913,595) | (913,595) | (913,595) | 2,385 | |||||
Dividends paid to noncontrolling interests | (5,771) | ||||||||
Share-based compensation (in shares) | 3.1 | ||||||||
Share-based compensation | $ 31 | 14,225 | 14,256 | ||||||
Postretirement/pension liability adjustment, net of tax | (3,514) | (3,514) | |||||||
Benefit plan amendment, net of tax of $0.7 million | 0 | ||||||||
Adoption of ASU 2018-02 (see Note 15—Income Taxes) | (16,191) | 16,191 | (16,191) | ||||||
Other comprehensive income, net of tax of $(0.2) million | $ 0 | ||||||||
Balance (in shares) at Dec. 31, 2019 | 141.1 | ||||||||
Ending balance at Dec. 31, 2019 | $ 1,411 | 2,565,696 | (7,503,830) | $ (916) | (63,135) | (4,999,858) | $ (916) | 11,010 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Accounting Standards Update [Extensible List] | Accounting Standards Update 2016-13 | ||||||||
Net income (loss) | $ (911,664) | (911,664) | (911,664) | 2,393 | |||||
Dividends paid to noncontrolling interests | (6,400) | ||||||||
Share-based compensation (in shares) | 1 | ||||||||
Share-based compensation | $ 10 | 8,144 | 8,154 | ||||||
Postretirement/pension liability adjustment, net of tax | (17,187) | (17,187) | |||||||
Benefit plan amendment, net of tax of $0.7 million | 0 | ||||||||
Adoption of ASU 2018-02 (see Note 15—Income Taxes) | 0 | ||||||||
Other comprehensive income, net of tax of $(0.2) million | $ 0 | ||||||||
Balance (in shares) at Dec. 31, 2020 | 142.1 | ||||||||
Ending balance at Dec. 31, 2020 | $ 1,421 | $ 2,573,840 | $ (8,416,410) | $ (80,322) | $ (5,921,471) | $ 7,003 |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Shareholders' Deficit (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2018 | |
Statement of Stockholders' Equity [Abstract] | ||
Postretirement/pension liability adjustment, tax (benefit) | $ (0.3) | $ 0.6 |
Benefit plan amendment, tax | 0.7 | |
Other comprehensive income, tax benefit | $ (0.2) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flows from operating activities: | |||
Net loss | $ (909,271) | $ (911,210) | $ (595,690) |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||
Depreciation and amortization | 653,447 | 658,233 | 687,589 |
Provision for (benefit from) expected credit losses | 56,940 | 17,190 | (836) |
Foreign currency transaction loss | 4,255 | 2,128 | 6,736 |
Loss on disposal of assets | 14 | 402 | 46 |
Satellite impairment loss | 0 | 381,565 | 0 |
Impairment of non-amortizable intangible and other assets | 191,943 | 0 | 0 |
Share-based compensation | 12,648 | 13,189 | 6,824 |
Deferred income taxes | 2,979 | (27,707) | 79,160 |
Amortization of discount, premium, issuance costs and related costs | 22,136 | 41,943 | 48,495 |
Non-cash reorganization items | 196,974 | 0 | 0 |
Debtor-in-possession financing fees | 59,682 | 0 | 0 |
Loss on early extinguishment of debt | 0 | 0 | 199,658 |
Amortization of actuarial loss (gain) and prior service credits for retirement benefits | 2,635 | (3,572) | 3,823 |
Unrealized (gains) losses on derivative financial instruments | 372 | 27,018 | (15,093) |
Unrealized (gains) losses on investments and loans held-for-investment | (3,041) | 39,695 | 408 |
Amortization of STC costs | 1,315 | 0 | 0 |
Sales-type lease | 0 | 7,064 | 0 |
Other non-cash items | 729 | (205) | 1,178 |
Changes in operating assets and liabilities: | |||
Receivables | (15,835) | (1,307) | (63,814) |
Prepaid expenses, contract and other assets | (137) | 15,664 | 3,708 |
Accounts payable and accrued liabilities | 79,337 | 10,908 | 7,291 |
Accrued interest payable | 52,623 | 24,008 | 21,442 |
Contract liabilities | (63,242) | (18,368) | (39,763) |
Accrued retirement benefits | (15,857) | (8,224) | (15,902) |
Other long-term liabilities | 656 | (12,875) | 8,913 |
Net cash provided by operating activities | 331,302 | 255,539 | 344,173 |
Cash flows from investing activities: | |||
Capital expenditures (including capitalized interest) | (606,759) | (229,818) | (255,696) |
Acquisition of business, net of cash acquired | (371,009) | 0 | 0 |
Acquisition of loans held-for-investment | (2,300) | (70,751) | (19,000) |
Proceeds from principal repayments on loans held-for-investment | 973 | 0 | 0 |
Capital contributions to unconsolidated affiliate (including capitalized interest) | (2,692) | (5,289) | (48,097) |
Proceeds from insurance settlements | 0 | 0 | 20,409 |
Acquisition of intangible assets | (344) | 0 | 0 |
Other proceeds from satellites | 5,625 | 13,125 | 18,750 |
Net cash used in investing activities | (976,506) | (292,733) | (283,634) |
Cash flows from financing activities: | |||
Proceeds from debtor-in-possession financing | 1,000,000 | 0 | 0 |
Debtor-in-possession financing fees | (59,682) | 0 | 0 |
Proceeds from issuance of long-term debt | 0 | 400,000 | 4,585,875 |
Repayments of long-term debt | 0 | 0 | (4,782,451) |
Debt issuance costs | 0 | (4,650) | (49,436) |
Debt modification fees | 0 | 0 | (3,954) |
Proceeds from stock issuance, net of issuance costs | 0 | 0 | 224,250 |
Payment of debt extinguishment costs | 0 | 0 | (33,890) |
Principal payments on deferred satellite performance incentives | (28,831) | (28,034) | (25,488) |
Dividends paid to noncontrolling interest | (6,400) | (5,771) | (8,825) |
Proceeds from exercise of employee stock options | 0 | 1,067 | 3,211 |
Other financing activities | 0 | 298 | 385 |
Net cash provided by (used in) financing activities | 905,087 | 362,910 | (90,323) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (3,200) | (2,009) | (4,450) |
Net change in cash, cash equivalents and restricted cash | 256,683 | 323,707 | (34,234) |
Cash, cash equivalents, and restricted cash, beginning of period | 830,864 | 507,157 | 541,391 |
Cash, cash equivalents, and restricted cash, end of period | 1,087,547 | 830,864 | 507,157 |
Supplemental cash flow information: | |||
Cash paid for reorganization items included in cash flows from operating activities | 93,211 | 0 | 0 |
Interest paid, net of amounts capitalized | 634,704 | 1,099,874 | 1,052,885 |
Income taxes paid (received), net of refunds | (7,566) | 33,584 | 57,085 |
Supplemental disclosure of non-cash investing activities: | |||
Accrued capital expenditures | 49,249 | 8,123 | 28,203 |
Capitalization of deferred satellite performance incentives | 0 | 29,382 | 28,161 |
Conversion of loans held-for-investment to equity securities | 4,802 | 0 | 0 |
Fair value of contract settled as consideration in business acquisition | 21,304 | 0 | 0 |
Conversion of payment-in-kind interest on loans held-for-investment | $ 3,424 | $ 0 | $ 0 |
Background and Summary of Signi
Background and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Background and Summary of Significant Accounting Policies | Background and Summary of Significant Accounting Policies Intelsat S.A. and its subsidiaries (“Intelsat S.A.,” “we,” “us,” “our” or the “Company”) provides satellite communications services worldwide through a global communications network of 52 satellites and ground facilities related to the satellite operations and control, and teleport services. Gogo Transaction On August 31, 2020, following approval from the U.S. Bankruptcy Court for the Eastern District of Virginia (the “Bankruptcy Court”), Intelsat Jackson and Gogo Inc. (NASDAQ: GOGO), a Delaware corporation (“Gogo”), entered into a purchase and sale agreement (the “Purchase and Sale Agreement”) with respect to Gogo’s commercial aviation business (“Gogo CA”) (as further described in Note 3—Acquisition of Gogo Commercial Aviation) for $400.0 million in cash, subject to customary adjustments (the “Purchase Price”). On December 1, 2020, Intelsat Jackson completed the acquisition pursuant to the terms of the Purchase and Sale Agreement. Upon completion of the acquisition, the entities comprising the Gogo CA business became wholly-owned subsidiaries of Intelsat S.A. Gogo CA’s operating results for the period from December 1, 2020 through December 31, 2020 have been included in our consolidated statement of operations for the year ended December 31, 2020 with no comparable amounts for 2018 or 2019. In accordance with the accounting guidance on business combinations, Gogo CA’s net assets acquired and liabilities assumed in the acquisition have been included in our consolidated balance sheet beginning on December 1, 2020. See Note 3—Acquisition of Gogo Commercial Aviation. C-band Spectrum Clearing On March 3, 2020, the U.S. Federal Communications Commission (“FCC”) issued its final order in the C-band proceeding (the “FCC Final Order”), which, among other things, provides for monetary incentives for fixed satellite services (“FSS”) providers to clear a portion of the C-band spectrum on an accelerated basis (the “Acceleration Payments”). On August 14, 2020, the Company filed its final C-band spectrum transition plan with the FCC. On September 17, 2020, the Company announced it finalized materially all of its required contracts with satellite manufacturers and launch-vehicle providers to move forward and meet the accelerated C-band spectrum clearing timelines established by the FCC. Under the FCC Final Order, the Company is eligible to receive Acceleration Payments of approximately $1.2 billion and $3.7 billion based on the milestone clearing certification dates of December 5, 2021 and December 5, 2023, with the respective payments expected to be received in the first half of each successive year, respectively, subject to the satisfaction of certain deadlines and other conditions. In addition, under the FCC Final Order, we are also entitled to receive reimbursement payments for certain C-band spectrum clearing expenses incurred, subject to the satisfaction of certain conditions set forth in the FCC Final Order. Impact of COVID-19 on the Company As a result of the novel coronavirus (“COVID-19”) pandemic in 2020, in an effort to safeguard public health, governments around the world, including United States (“U.S.”) federal, state and local governments, implemented a number of orders and restrictions on travel and businesses, among other things. Some of these measures remain in effect and have negatively impacted the U.S. and other economies around the world in the short-term, while the long-term economic impact of COVID-19 remains unknown. The COVID-19 pandemic has had an adverse impact on our business, results of operations and financial condition, a trend we expect to continue. Among the impacts of the COVID-19 pandemic were a reduction of revenue and a decreased likelihood of collection from certain mobility customers. We continue to closely monitor the ongoing impact on our employees, customers, business and results of operations. (a) Principles of Consolidation The accompanying consolidated financial statements include the accounts of Intelsat S.A., its wholly-owned subsidiaries, and variable interest entities (“VIE”) of which we are the primary beneficiary, and are prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). References to U.S. GAAP issued by the Financial Accounting Standards Board (“FASB”) in these footnotes are to the FASB Accounting Standards Codification (“ASC”). We are the primary beneficiary of one VIE, as more fully described in Note 10—Investments, and accordingly, we include in our consolidated financial statements the assets and liabilities and results of operations of the entity, even though we may not own a majority voting interest. We use the equity method to account for our investments in entities where we exercise significant influence over operating and financial policies but do not retain control under either the voting interest model (generally 20% to 50% ownership interest) or the variable interest model. In 2015, we entered into a joint venture agreement as further described in Note 10—Investments, and the investment is accounted for using the equity method. We have eliminated all significant intercompany accounts and transactions. (b) Use of Estimates The preparation of these consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of these consolidated financial statements, the reported amounts of revenues and expenses during the reporting periods, and the disclosures of contingent liabilities. Accordingly, ultimate results could differ from those estimates. (c) Revenue Recognition We earn revenue primarily by providing services over satellite transponder capacity to our customers. Our customers generally obtain satellite services from us by placing an order pursuant to one of several master customer service agreements and related service orders. See Note 5—Revenue for further discussion regarding revenue recognition policies. (d) Fair Value Measurements We estimate the fair value of our financial instruments using available market information and valuation methodologies. The carrying amounts of cash and cash equivalents, receivables, accounts payable and accrued liabilities approximate their fair values because of the short maturity of these financial instruments. ASC 820, Fair Value Measurements and Disclosure (“ASC 820”) defines fair value as the price that would be received in the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820 requires disclosure of the extent to which fair value is used to measure financial assets and liabilities, the inputs utilized in calculating valuation measurements, and the effect of the measurement of significant unobservable inputs on earnings, or changes in net assets, as of the measurement date. ASC 820 establishes a three-level valuation hierarchy based upon the transparency of inputs utilized in the measurement and valuation of financial assets or liabilities as of the measurement date. We apply fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis. The fair value hierarchy prioritizes the inputs used in valuation techniques into three levels as follows: • Level 1—unadjusted quoted prices for identical assets or liabilities in active markets; • Level 2—quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, and inputs other than quoted market prices that are observable or that can be corroborated by observable market data by correlation; and • Level 3—unobservable inputs based upon the reporting entity’s internally developed assumptions which market participants would use in pricing the asset or liability. (e) Cash and Cash Equivalents and Restricted Cash Cash and cash equivalents consist of cash on hand and highly liquid investments with original maturities of three months or less, which are generally time deposits with banks and money market funds. The carrying amount of these investments approximates fair value. Restricted cash represents legally restricted amounts being held as a compensating balance for certain outstanding letters of credit. The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within our consolidated balance sheets to the total sum of these amounts reported in our consolidated statements of cash flows (in thousands): As of December 31, 2019 As of December 31, 2020 Cash and cash equivalents $ 810,626 $ 1,060,917 Restricted cash, current 20,238 21,130 Restricted cash included in other assets — 5,500 Cash, cash equivalents and restricted cash $ 830,864 $ 1,087,547 (f) Receivables and Allowance for Credit Losses We provide satellite services and extend credit to numerous customers in the satellite communication, telecommunications and video markets, as well as the airline industry. We monitor our exposure to credit losses and maintain allowances for credit losses and anticipated losses. The Company’s methodology to measure the provision for credit losses considers all relevant information to include information about historical collectability, current conditions and reasonable and supportable forecasts of future economic conditions. We believe we have adequate customer collateral and reserves to cover our exposure. As of December 31, 2020, we have incurred $405.2 million related to expected reimbursable costs associated with the FCC Final Order, which are included within the receivables line item on our consolidated balance sheets. Fulfillment costs incurred as a result of the FCC Final Order, which include costs to pay personnel or third parties to assist with customer reconfiguration and relocation, installation of filters, and program management costs, are expensed as incurred and are included within other operating expense—C-band on our consolidated statements of operations. (g) Satellites and Other Property and Equipment Satellites and other property and equipment are stated at historical cost, except for satellites that have been impaired. Satellites and other property and equipment acquired as part of an acquisition are stated based on their fair value at the date of acquisition. Capitalized costs consist primarily of the costs of satellite construction and launch, including launch insurance and insurance during the period of in-orbit testing, the net present value of performance incentives expected to be payable to the satellite manufacturers (dependent on the continued satisfactory performance of the satellites), costs directly associated with the monitoring and support of satellite construction, and interest costs incurred during the period of satellite construction. We depreciate satellites and other property and equipment on a straight-line basis over the following estimated useful lives: Years Buildings and improvements 10 - 40 Satellites and related costs 10 - 17 Ground segment equipment and software 4 - 15 Furniture and fixtures and computer hardware 3 - 12 Leasehold improvements (1) 2 - 13 Network equipment 5 - 25 (1) Leasehold improvements are depreciated over the shorter of the useful life of the improvement or the remaining lease term. (h) Other Assets Other assets primarily consist of investments in certain equity securities, equity method investments, loan receivables, right-of-use (“ROU”) assets, long-term deposits and other miscellaneous deferred charges and long-term assets. See Note 10—Investments for additional discussion regarding equity securities, equity method investments and loan receivable accounting policies. See Note 14—Leases and— (v) Leases below for additional discussion regarding ROU asset accounting policies. (i) Goodwill and Other Intangible Assets We account for goodwill and other intangible assets in accordance with ASC 350, Intangibles—Goodwill and Other (“ASC 350”). Goodwill represents the excess of the consideration transferred plus the fair value of any noncontrolling interest in the acquiree at the acquisition date over the fair values of identifiable net assets of businesses acquired. Goodwill and certain other intangible assets deemed to have indefinite lives are not amortized but are tested on an annual basis for impairment during the fourth quarter, or whenever events or changes in circumstances indicate that the carrying amount may not be fully recoverable. See Note 11—Goodwill and Other Intangible Assets. Intangible assets arising from business combinations are initially recorded at fair value. We record other intangible assets at cost. We amortize intangible assets with determinable lives based on the expected pattern of consumption. We review these intangible assets for impairment whenever facts and circumstances indicate that the carrying amounts may not be recoverable. See Note 11—Goodwill and Other Intangible Assets. (j) Impairment of Long-Lived Assets We review long-lived assets, including property and equipment and acquired intangible assets with estimable useful lives, for impairment whenever events or changes in circumstances indicate that the carrying amount of such an asset may not be recoverable. These indicators of impairment can include, but are not limited to, the following: • satellite anomalies, such as a partial or full loss of power; • under-performance of an asset compared to expectations; and • shortened useful lives due to changes in the way an asset is used or expected to be used. The recoverability of an asset to be held and used is determined by comparing the carrying amount to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of the asset exceeds its estimated undiscounted future cash flows, we record an impairment charge in the amount by which the carrying amount of the asset exceeds its fair value, which we determine by either a quoted market price, if any, or a value determined by utilizing discounted cash flow techniques. (k) Income Taxes We account for income taxes in accordance with ASC 740, Income Taxes (“ASC 740”). We are subject to income taxes in Luxembourg, as well as the United States and a number of other foreign jurisdictions. Significant judgment is required in the calculation of our tax provision and the resulting tax liabilities and in the recoverability of our deferred tax assets that arise from temporary differences between the tax and financial statement recognition of revenue and expense and net operating loss and credit carryforwards. We regularly assess the likelihood that our deferred tax assets can be recovered. A valuation allowance is required when it is more likely than not that all or a portion of the deferred tax asset will not be realized. We evaluate the recoverability of our deferred tax assets based in part on the existence of deferred tax liabilities that can be used to realize the deferred tax assets. During the ordinary course of business, there are transactions and calculations for which the ultimate tax determination is uncertain. We evaluate our tax positions to determine if it is more likely than not that a tax position is sustainable, based solely on its technical merits and presuming the taxing authorities have full knowledge of the position and access to all relevant facts and information. When a tax position does not meet the more likely than not standard, we record a liability or contra asset for the entire amount of the unrecognized tax impact. Additionally, for those tax positions that are determined more likely than not to be sustainable, we measure the tax position at the largest amount of benefit more likely than not (determined by cumulative probability) to be realized upon settlement with the taxing authority. (l) Foreign Currency Translation Our functional currency is the U.S. dollar, since substantially all customer contracts, capital expenditure contracts and operating expense obligations are denominated in U.S. dollars. Transactions not denominated in U.S. dollars have been translated using the spot rates of exchange at the dates of the transactions. We recognize differences on exchange arising on the settlement of the transactions denominated in currencies other than the U.S. dollar in the consolidated statements of operations. (m) Comprehensive Loss Comprehensive loss consists of net loss and other gains and losses affecting shareholders’ deficit that, under U.S. GAAP, are excluded from net loss. Such items consist primarily of the change in the market value of pension liability adjustments. (n) Share-Based Compensation We account for share-based compensation expense in accordance with ASC 718, Compensation — Stock Compensation , which requires us to measure and recognize compensation expense in our financial statements based on the fair value at the date of grant for our share-based awards, which include restricted share units (“RSUs”) and stock options granted to certain employees and RSUs granted to certain eligible directors. We recognize compensation expense for these equity-classified awards over their requisite service period and adjust for forfeitures as they occur. Share based compensation expense was $6.8 million, $13.2 million, and $10.9 million for the years ended December 31, 2018, 2019 and 2020, respectively. As a result of our Chapter 11 proceedings, the exercise prices of our stock options are significantly in excess of the current market price of our common shares. In addition, all of our share-based compensation awards currently outstanding are expected to be canceled as part of our reorganization proceedings. (o) Deferred Satellite Performance Incentives The cost of satellite construction may include an element of deferred consideration that we are obligated to pay to satellite manufacturers over the lives of the satellites, provided the satellites continue to operate in accordance with contractual specifications. Historically, the satellite manufacturers have earned substantially all of these payments. Therefore, we account for these payments as deferred financing. We capitalize the present value of these payments as part of the cost of the satellites and record a corresponding liability to the satellite manufacturers. Interest expense is recognized on the deferred financing and the liability is reduced as the payments are made. (p) Derivative Instruments We enter into derivative transactions primarily to manage our exposure to fluctuations in foreign exchange rates and interest rates. We employ risk management strategies, which may include the use of foreign currency swaps, interest rate swaps and interest rate caps. We measure all derivatives at fair value and recognize them as either assets or liabilities on our consolidated balance sheets. Changes in the fair value of derivative instruments not qualifying as hedges are recognized in earnings in the current period. We do not have any derivative instruments that qualify for hedge accounting. (q) Bankruptcy Accounting Our consolidated financial statements included herein have been prepared as if we are a going concern and reflect the application of ASC 852, Reorganizations (“ASC 852”). ASC 852 requires the financial statements, for periods subsequent to the commencement of our Chapter 11 proceedings, to distinguish transactions and events that are directly associated with the reorganization from the ongoing operations of the business. Accordingly, we classify liabilities and obligations whose treatment and satisfaction are dependent on the outcome of the reorganization under the Chapter 11 proceedings as liabilities subject to compromise on our consolidated balance sheets. In addition, we classify all income, expenses, gains or losses that are incurred or realized as a result of the Chapter 11 proceedings as reorganization items in our consolidated statements of operations. See Note 2 — Chapter 11 Proceedings, Ability to Continue as a Going Concern and Other Related Matters. (r) Inventory Inventories consist primarily of telecommunications systems and parts associated with our Gogo CA business and are recorded at the lower of average cost or market. We evaluate the need for write-downs associated with obsolete, slow-moving and nonsalable inventory by reviewing net realizable inventory values on a periodic basis. (s) Business Combinations The Company accounts for business combinations under ASC 805, Business Combinations ("ASC 805"). ASC 805 uses the acquisition method of accounting, and accordingly, the assets and liabilities of the acquired business are recorded at their fair values at the date of acquisition. The excess of the purchase price over the estimated fair value is recorded as goodwill. All acquisition costs are expensed as incurred. Upon acquisition, the accounts and results of operations are consolidated as of and subsequent to the acquisition date. See Note 3 — Acquisition of Gogo Commercial Aviation for more information. (t) Warranty We provide warranties on parts and labor related to our products for Gogo CA. Our warranty terms range from two December 31, 2020, the balance of our warranty reserve was $19.6 million. (u) Software Development Costs For software sold as part of our equipment sales in connection with Gogo CA , we capitalize software development costs once technological feasibility has been established. Such capitalized software costs are amortized on a product-by-product basis over the remaining estimated economic life of the product, based on the greater of the ratio that current gross revenues for a product bear to the total of current and anticipated future gross revenues for that product or the straight-line method. These costs are included in amortizable intangible assets, net in our consolidated balance sheets. (v) Leases We adopted ASC 842, Leases (“ASC 842”) effective January 1, 2019 using the effective date method and applied the package of practical expedients included therein. We determine if a contract is or contains a lease at inception or modification of a contract. A contract is or contains a lease if the contract conveys the right to control the use of an identified asset for a period in exchange for consideration. Control over the use of the identified asset means the lessee has both (a) the right to obtain substantially all of the economic benefits from the use of the asset and (b) the right to direct the use of the asset. Operating and finance lease ROU assets and lease liabilities are recognized based on the present value of future minimum lease payments over the expected lease term, at the commencement date. For leases in which the implicit rate is not readily determinable, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The expected lease terms include options to extend or terminate the lease when it is reasonably certain the Company will exercise such option. ROU assets include unpaid lease payments and exclude lease incentives and initial direct costs incurred. For our operating leases, we recognize lease expense for minimum lease payments on a straight-line basis over the lease term, and for our finance leases, we recognize interest expense on the lease liability using the effective interest method and amortization of the ROU assets on a straight-line basis over the lease term. We have lease agreements with lease and non-lease components, which are generally combined, consistent with our election of the practical expedient. For lease agreements entered into or reassessed after the adoption of ASC 842 in which the Company is the lessee, the Company accounts for the lease components (e.g. fixed payments including rent, real estate taxes and insurance costs) and non-lease components (e.g. common-area maintenance costs and managed service contracts) as a single lease component for all classes of underlying assets. Leases in which the Company is the lessor are also evaluated for lease and non-lease components. In the event a sales-type lease is identified, this component is accounted for separately from lease and non-lease components that meet the practical expedient to be combined. Judgment is required in determining the allocation between lease components and also between the lease and non-lease components, as the non-lease components are the predominant components of the combined components of our sales-type leases. ASC 606, Revenue from Contracts with Customers (“ASC 606”) is applied to the combined lease and non-lease components. Leases with an expected term of 12 months or less are not accounted for on the balance sheet and the related lease expense is recognized on a straight-line basis over the expected lease term. See Note 14—Leases for further details. (w) Recently Adopted Accounting Pronouncements In June 2016, the FASB issued Accounting Standards Update (“ASU”) ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which changes how companies measure and recognize credit impairment for any financial assets. The standard requires companies to immediately recognize an estimate of credit losses expected to occur over the remaining life of the financial assets that are within the scope of the standard. We adopted ASU 2016-13 and its amendments in the first quarter of 2020, on a modified retrospective basis. The adoption of ASU 2016-13 and its amendments increased our reserve for credit losses by $0.9 million as of January 1, 2020. In January 2017, the FASB issued ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (“ASU 2017-04”), which is intended to simplify the subsequent measurement of goodwill. The amendments in ASU 2017-04 modify the concept of impairment from the condition that exists when the carrying amount of goodwill exceeds its fair value to the condition that exists when the carrying amount of a reporting unit exceeds its fair value. An entity will no longer determine goodwill impairment by calculating the implied fair value of goodwill by assigning the fair value of a reporting unit to all of its assets and liabilities, as if that reporting unit had been acquired in a business combination. We adopted ASU 2017-04 in the first quarter of 2020, on a prospective basis. As a result, we will measure impairment using the difference between the carrying amount and the fair value of the reporting unit, if required. See Note 11 — Goodwill and Other Intangible Assets for further information. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820)—Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”), as part of its disclosure framework project to improve the effectiveness of disclosures in the notes to financial statements. Changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty were applied prospectively for only the most recent interim period presented. All other amendments were applied retrospectively for all periods presented. ASU 2018-13 and its amendments were adopted by the Company in the first quarter of 2020. In August 2018, the FASB issued ASU 2018-14, Compensation—Retirement Benefits—Defined Benefit Plans—General (Subtopic 715-20)—Disclosure Framework—Changes to the Disclosure Requirements for Defined Benefit Plans (“ASU 2018-14”), as part of its disclosure framework project to improve the effectiveness of disclosures in the notes to financial statements. ASU 2018-14 modifies and clarifies disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans. The amendments remove certain disclosure requirements and require additional disclosures. ASU 2018-14 was adopted by the Company in the fourth quarter of 2020 on a retrospective basis to all periods presented. In August 2018, the FASB issued ASU 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40)—Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (“ASU 2018-15”), which requires an entity in a hosting arrangement that is a service contract to follow the guidance in Subtopic 350-40 to determine which implementation costs to capitalize as an asset related to the service contract and which costs to expense. ASU 2018-15 was adopted by the Company in the first quarter of 2020. The adoption did not have a significant impact on the Company. (x) Recently Issued Accounting Pronouncements In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting For Income Taxes (“ASU 2019-12”). The standard removes certain exceptions for recognizing deferred taxes for investments, performing intra-period allocation and calculating income taxes in interim periods. It also adds guidance to reduce complexity in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group. ASU 2019-12 will be effective for the Company for annual periods in fiscal years beginning after December 15, 2020. The impact of the adoption of ASU 2019-12 on our consolidated financial statements and associated disclosures is not expected to be material. In August 2020, the FASB issued ASU 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”). The standard simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts regarding an entity’s own equity. ASU 2020-06 is part of the FASB’s simplification initiative, which aims to reduce unnecessary complexity in U.S. GAAP. ASU 2020-06 will be effective for the Company for interim and annual periods in fiscal years beginning after December 15, 2021. We are in the process of evaluating the impact that ASU 2020-06 will have on our consolidated financial statements and associated disclosures. |
Chapter 11 Proceedings, Ability
Chapter 11 Proceedings, Ability to Continue as a Going Concern and Other Related Matters | 12 Months Ended |
Dec. 31, 2020 | |
Reorganizations [Abstract] | |
Chapter 11 Proceedings, Ability to Continue as a Going Concern and Other Related Matters | Chapter 11 Proceedings, Ability to Continue as a Going Concern and Other Related Matters Voluntary Reorganization under Chapter 11 On May 13, 2020, Intelsat S.A. and certain of its subsidiaries (each, a “Debtor” and collectively, the “Debtors”) commenced voluntary cases (the “Chapter 11 Cases”) under title 11 of the United States Code (the “Bankruptcy Code”) in the United States Bankruptcy Court for the Eastern District of Virginia (the “Bankruptcy Court”). Primary factors causing us to file for Chapter 11 protection included the Company’s intention to participate in the accelerated clearing process of C-band spectrum set forth in the FCC Final Order, requiring the Company to incur significant costs related to clearing activities well in advance of receiving reimbursement for such costs and the need for additional financing to fund the C-band clearing process, service our current debt obligations, and meet our operating requirements, as well as the economic slowdown impacting the Company and several of its end markets due to the COVID-19 pandemic. On August 14, 2020, the Company filed its final C-band spectrum transition plan with the FCC. On September 17, 2020, the Company announced it finalized materially all of its required contracts with satellite manufacturers and launch-vehicle providers to move forward and meet the accelerated C-band spectrum clearing timelines established by the FCC. The Chapter 11 process can be unpredictable and involves significant risks and uncertainties. Pursuant to various orders from the Bankruptcy Court, the Debtors have received approval from the Bankruptcy Court to generally maintain their ordinary operations and uphold certain commitments to their stakeholders, including employees, customers, and vendors, during the restructuring process, subject to the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code. Our ability to fund operating expenses may be subject to obtaining further approvals from the Bankruptcy Court in connection with the Chapter 11 Cases. On June 9, 2020, Intelsat Jackson received approval from the Bankruptcy Court (the “DIP Order”) to enter into a non-amortizing multiple draw superpriority secured debtor-in-possession term loan facility (the “DIP Facility”), in an aggregate principal amount of $1.0 billion on the terms and conditions as set forth in the DIP Facility credit agreement (the “DIP Credit Agreement”) with certain of the Debtors’ prepetition secured parties (the “DIP Lenders”), and on June 17, 2020, Intelsat Jackson and certain of its subsidiaries as guarantors (together with Intelsat Jackson, the “DIP Debtors”) entered into the DIP Credit Agreement with the DIP Lenders, as amended by an amendment (“DIP Amendment No. 1”) to the DIP Credit Agreement, dated as of August 24, 2020, and as further amended by a second amendment (“DIP Amendment No. 2”) to the DIP Credit Agreement, dated as of November 25, 2020. For additional information regarding the DIP Facility, DIP Credit Agreement, DIP Amendment No. 1 and DIP Amendment No. 2, see Note 12—Debt. On July 11, 2020, the Debtors filed with the Bankruptcy Court schedules and statements setting forth, among other things, the assets and liabilities of each of the Debtors, subject to the assumptions filed in connection therewith. These schedules and statements may be subject to further amendment or modification after filing. On February 11, 2021, the Debtors entered into a plan support agreement (together with all exhibits and schedules thereto, the “PSA”), with certain of the Debtors’ prepetition secured and unsecured creditors (the “Consenting Creditors” and together with the Debtors, the “PSA Parties”). The PSA contains certain covenants on the part of the PSA Parties, including but not limited to the Consenting Creditors voting in favor of the Joint Chapter 11 Plan of Reorganization of Intelsat S.A. and Its Debtor Affiliates (as proposed, the “Plan”), and provides that the Debtors shall achieve certain milestones (unless extended or waived in writing). In connection with the PSA, on February 12, 2021, the Debtors filed the Plan and the Disclosure Statement for the Joint Chapter 11 Plan of Reorganization of Intelsat S.A. and Its Debtor Affiliates (the “Disclosure Statement”), which describes a variety of topics related to the Chapter 11 Cases, including (i) events leading to the Chapter 11 Cases; (ii) significant events that took place during the Chapter 11 Cases; (iii) certain terms of the Plan; and (iv) certain anticipated risk factors associated with, and anticipated consequences of the Plan. The Bankruptcy Court is currently scheduled to determine the adequacy of the Disclosure Statement and whether the Plan meets the requirements of the Bankruptcy Code in the second quarter of 2021. The filing of the Chapter 11 Cases constituted an event of default that accelerated substantially all of our obligations under the documents governing the prepetition existing indebtedness of Intelsat S.A., Intelsat Luxembourg, Intelsat Connect and Intelsat Jackson. For additional discussion regarding the impact of the Chapter 11 Cases on our debt obligations, see Note 12—Debt. While the Chapter 11 Cases are pending, the Debtors do not anticipate making interest payments due under their respective unsecured debt instruments; however, the Debtors expect to make monthly interest payments on their senior secured debt instruments pursuant to the adequate protection requirements under the DIP Order. For the year ended December 31, 2020, the contractual interest expense pursuant to our unsecured debt instruments that was not recognized in our consolidated statements of operations was $495.2 million. Delisting of Intelsat S.A. Common Shares On May 20, 2020, the New York Stock Exchange (“NYSE”) filed a Form 25 with the SEC to delist the Company’s common shares, $0.01 par value from the NYSE. The delisting became effective 10 days after the Form 25 was filed. The deregistration of the common shares under Section 12(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) became effective 90 days after the filing date of the Form 25. The common shares remain registered under Section 12(g) of the Exchange Act. The Company’s common shares began trading on the OTC Pink Marketplace on May 19, 2020 under the symbol “INTEQ.” Liabilities Subject to Compromise Prepetition unsecured liabilities of the Debtors subject to compromise under the Chapter 11 proceedings have been distinguished from secured liabilities that are not expected to be compromised and post-petition liabilities in our consolidated balance sheets. Liabilities subject to compromise have been recorded at the amounts expected to be allowed by the Bankruptcy Court. The ultimate settlement amounts of these liabilities remain at the discretion of the Bankruptcy Court and may vary from the expected allowed amounts. Liabilities subject to compromise consisted of the following (in thousands): As of December 31, 2020 Accounts payable $ 9,545 Debt subject to comprise 9,782,161 Accrued interest on debt subject to compromise 341,676 Other long-term liabilities subject to compromise 35,136 Total liabilities subject to compromise $ 10,168,518 Reorganization Items The expenses, gains and losses directly and incrementally resulting from the Chapter 11 Cases are separately reported as reorganization items in our consolidated statements of operations. Reorganization items consisted of the following (in thousands): Year Ended December 31, 2020 Adjustment of debt discount, premium and issuance costs $ 196,974 Debtor-in-possession financing fees 59,682 Professional fees 129,659 Other reorganization income (454) Total reorganization items $ 385,861 Going Concern Our consolidated financial statements have been prepared assuming that we will continue as a going concern, which contemplates continuity of operations, realization of assets, and satisfaction of liabilities in the normal course of business. In connection with the preparation of our consolidated financial statements, we conducted an evaluation as to whether there were conditions and events, considered in the aggregate, that raised substantial doubt as to the Company’s ability to continue as a going concern. As reflected in our consolidated financial statements, the Company had cash and cash equivalents of $1.1 billion and an accumulated deficit of $8.4 billion as of December 31, 2020. The Company generated income from operations of $269.0 million and a net loss of $909.3 million for the year ended December 31, 2020. In light of the Company’s Chapter 11 proceedings, our ability to continue as a going concern is contingent upon, among other things, our ability to, subject to the Bankruptcy Court’s approval, implement a business plan of reorganization, emerge from the Chapter 11 proceedings and generate sufficient liquidity following the reorganization to meet our contractual obligations and operating needs. As a result of risks and uncertainties related to, among other things, (i) the Company’s ability to obtain requisite support for the business plan of reorganization from various stakeholders, and (ii) the disruptive effects of the Chapter 11 proceedings on our business making it potentially more difficult to maintain business, financing and operational relationships, substantial doubt exists regarding our ability to continue as a going concern. The filing of the Chapter 11 Cases constituted an event of default that accelerated substantially all of our obligations under the documents governing the prepetition existing indebtedness of Intelsat S.A., Intelsat Luxembourg, Intelsat Connect and Intelsat Jackson. As such, we have reclassified all such debt obligations, other than debt subject to compromise, to current maturities of long-term debt on our consolidated balance sheet as of December 31, 2020. For additional discussion regarding the impact of the Chapter 11 Cases on our debt obligations, see Note 12—Debt. Our consolidated financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should we be unable to continue as a going concern. |
Acquisition of Gogo Commercial
Acquisition of Gogo Commercial Aviation | 12 Months Ended |
Dec. 31, 2020 | |
Business Combinations [Abstract] | |
Acquisition of Gogo Commercial Aviation | Acquisition of Gogo Commercial Aviation On December 1, 2020, we acquired all of the equity interests of Gogo LLC and Gogo International Holdings LLC (collectively known as “Gogo CA”), according to the terms and conditions of the Purchase and Sale Agreement (the “Gogo Transaction”). Gogo CA is one of the largest global providers of in-flight broadband connectivity. The acquisition of Gogo CA brings together two complementary enterprises – one of the world’s largest satellite operators with a leading provider of commercial in-flight broadband and entertainment services, to deliver innovation and long-term value to commercial airlines. The acquisition was not significant to the overall consolidated results for the year ended December 31, 2020 as it did not have a material impact to revenue, net loss or net loss per common share attributable to Intelsat S.A. The Company accounted for the business combination in accordance with ASC 805 . The Company recorded the acquisition using the acquisition method of accounting and recognized assets and liabilities at their fair value as of the date of acquisition. The Company based the preliminary allocation of the purchase price on estimates and assumptions known at the date of acquisition that are subject to change within the purchase price allocation period, which is generally one year from the acquisition date. The net payment associated with the transaction was $386.4 million, which represents total cash consideration of $400.0 million, adjusted for estimated closing cash, indebtedness, working capital excess and any transaction expenses. The primary difference between the net payment and purchase consideration of $409.1 million is the settlement of a pre-existing relationship that was favorable to Intelsat S.A. The preliminary allocation of the purchase consideration to tangible and intangible assets acquired and liabilities assumed on the acquisition date is based on estimated fair values and is as follows (in thousands): Estimated Fair Value Assets acquired Cash and cash equivalents $ 9,867 Receivables, net of allowances 52,849 Inventory 144,014 Prepaid expenses and other current assets 36,140 Property and equipment 41,328 Amortizable intangible assets Software 45,464 Trade name 1,000 Goodwill 77,620 Other assets Supplemental type certificates 24,253 Line fit certificates 21,776 Other assets 100,566 Total assets acquired 554,877 Liabilities assumed Current liabilities Accounts payable and accrued liabilities (63,300) Contract liabilities (13,527) Other current liabilities (25,472) Noncurrent liabilities (43,522) Total liabilities assumed (145,821) Total purchase consideration $ 409,056 The fair value estimates of the net assets acquired are based upon calculations and valuations, and estimates and assumptions regarding certain tangible and identifiable intangible assets acquired and liabilities assumed. The excess of the total consideration over the tangible assets, identifiable intangible assets, and assumed liabilities is recorded as goodwill. Goodwill represents expected synergies in mobility services and connectivity, $66.9 million of which is deductible for tax purposes. Gogo CA contributed $15.6 million of revenue and $12.9 million of net loss for the period December 1, 2020 through December 31, 2020, which is included in the consolidated statements of operations . If the acquisition had occurred on January 1, 2019, our unaudited pro forma revenue and net loss would have been $2.6 billion and $971.1 million, respectively, for the year ended December 31, 2019, and $2.1 billion and $1.2 billion, respectively, for the year ended December 31, 2020. The unaudited pro forma combined financial information is disclosed for illustrative purposes and does not purport to represent what the results of operations would actually have been if the business combination occurred as of the dates indicated or what the results would be for any future periods. Acquisition-related costs amounted to $15.9 million, which are included within selling, general and administrative expenses in our consolidated statements of operations. |
Share Capital
Share Capital | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Share Capital | Share CapitalUnder our Articles of Incorporation, we have an authorized share capital of $10.0 million, represented by 1.0 billion shares of any class with a nominal value of $0.01 per share. At December 31, 2020, there were 142.1 million common shares issued and outstanding. |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue (a) Revenue Recognition We earn revenue primarily by providing services to our customers using our satellite transponder capacity. Our customers generally obtain satellite capacity from us by placing an order pursuant to one of several master customer service agreements. On-network services are comprised primarily of services delivered on our owned network infrastructure, as well as commitments for third-party capacity, generally long-term in nature, that we integrate and market as part of our owned infrastructure. In the case of third-party services in support of government applications, the commitments for third-party capacity are shorter and matched to the government contracting period, and thus remain classified as off-network services. Off-network services can include transponder services and other satellite-based transmission services, such as mobile satellite services (“MSS”), which are sourced from other operators, often in frequencies not available on our network. Under the category Off-Network and Other Revenues, we also include revenues from consulting and other services. Our Gogo CA revenue is primarily earned from providing connectivity and entertainment services and through sales of equipment. For each service type, the price per unit in our contracts is generally fixed for each defined time period. While the number of units or price per unit in our multi-year contracts may be different by year or another time period, the number of units and price per unit are fixed for each defined time period and the total contract price is fixed. To determine the proper revenue recognition method for contracts, we evaluate whether two or more services should be combined and accounted for as a single performance obligation. Certain Gogo CA contracts may be based on a fixed monthly fee per aircraft or a variable fee based on the volume of connectivity activity, or a combination of both. Examples of variable consideration within our contracts include megabyte overages and pay-per-use sessions. We constrain our estimates to reduce the probability of a significant revenue reversal in future periods, allocate such variable consideration to the identified performance obligations and recognize revenue in the period the services are provided. Our estimates are based on historical experience, anticipated future performance, market conditions and our best judgment at the time. A significant change in one or more of these estimates could affect our estimated contract value, and we regularly review and update our estimates and recognize adjustments under the cumulative catch-up model. Any adjustment under this method is recorded as a cumulative adjustment in the period identified and revenue for future periods is recognized using the new adjusted estimate. Our specific revenue recognition policies are as follows: Satellite Utilization Charges The Company’s contracts for satellite utilization services often contain multiple service orders for the provision of capacity on or over different beams, satellites, frequencies, geographies or time periods. Under each separate service order, the Company’s satellite services, comprised of transponder services, managed services, channel services, and occasional use managed services, are delivered in a series of time periods that are distinct from each other and have the same pattern of transfer to the customer. In each period, the Company’s obligation is to make those services available to the customer. Throughout each service period, the Company provides services that are able to be used continuously, and the customer simultaneously receives and consumes the benefits provided by the Company. We believe that, given that our services are stand-ready obligations that are available continuously, the passage of time most faithfully reflects our satisfaction of the performance obligation. We also have certain obligations, including providing spare or substitute capacity if available, in the event of satellite service failure under certain long-term agreements. While we are generally not obligated to refund satellite utilization payments previously made, credits may be granted for sustained service outages in certain limited circumstances. Similar to satellite utilization charges, we have determined that the customer simultaneously receives and consumes benefits provided by the Company for satellite related consulting and technical services, tracking, telemetry and commanding services (“TT&C”) and in-orbit backup services, as detailed below. Therefore, we believe that the passage of time most faithfully reflects our satisfaction of the performance obligation for these services: Satellite-Related Consulting and Technical Services . We recognize revenue from the provision of consulting services as those services are performed. We recognize revenue for consulting services with specific performance obligations, such as transfer orbit support services or training programs over the service period. TT&C . We earn TT&C services revenue from providing operational services to other satellite owners and from certain customers on our satellites. TT&C agreements entered into in connection with our satellite utilization contracts are typically for the period of the related service agreement. We recognize this revenue over the term of the service agreement. In-Orbit Backup Services . We provide back-up transponder capacity that is held on reserve for certain customers on agreed-upon terms. We recognize revenues for in-orbit protection services over the term of the related agreement. Revenue Share Arrangements. We recognize revenues under revenue share agreements for satellite-related services either on a gross or net basis in accordance with principal versus agent considerations. Airline connectivity revenue. Connectivity is provided to our customers using both our ATG and satellite technologies. Under the airline-directed business model, the airline is our customer and we earn service revenue as connectivity services are consumed directly by the airline or indirectly by passengers. Under the turnkey business model, we earn revenue for connectivity services consumed directly by passengers. Entertainment revenue. Entertainment revenue consists of entertainment services we provide to the airline for use by its passengers. Revenue is recognized as the services are provided to the airline. Connected Aircraft Services. We recognize revenue for real-time credit card transaction processing, electronic flight bags, and real-time weather information as the service is provided. Equipment Revenue. Equipment revenue primarily consists of the sale of air-to-ground and satellite connectivity equipment and the sale of entertainment equipment. Equipment revenue is recognized when we transfer control of the equipment to our customers, which generally occurs upon shipment. We occasionally sell products or services individually or in some combination to our customers. When products or services are sold together, we allocate revenue for each performance obligation based on each obligation’s relative selling price. In these arrangements, revenue for products is recognized when the transfer of control passes to the customer, while service revenue is recognized over the service term. Contract Assets Contract assets include unbilled amounts typically resulting from sales under our long-term contracts when the total contract value is recognized on a straight-line basis and the revenue recognized exceeds the amount billed to the customer. Contract assets also result from revenue contracts with multiple performance obligations when the allocated revenue recognized from satisfied performance obligations exceeds the amount billed to the customer. Contract Liabilities Contract liabilities consist of advance payments and collections in excess of revenue recognized and deferred revenue. Our contracts at times contain prepayment terms that range from one month to one year in advance of providing the service. As a practical expedient, we do not need to adjust the promised amount of consideration for the effects of a significant financing component if we expect, at contract inception, that the period of time between when the Company transfers a promised good or service to a customer and when the customer pays for that good or service will be one year or less. For a small subset of contracts with advance payments that contain prepayment terms greater than one year and up to fifteen years, we assess whether a significant financing component exists by considering the difference between the amount of promised consideration and the cash selling price of the promised services. The prepayment amount is generally based on a standard methodology that discounts the total of the standard monthly charges over the service term to determine the prepayment amount, resulting in a difference between the amount of promised consideration and the cash selling price of the promised services. The Company considers the timing difference between payment and the promised transfer of services, combined with the Company’s incremental borrowing rates, to determine whether a significant financing component exists. When a significant financing component exists, the amount of revenue recognized exceeds the amount of cash received from the customer. After receiving cash from the customer but prior to the Company providing services, the Company records additional contract liabilities as well as offsetting interest expense to reflect the upfront financing the Company is effectively receiving from the customer. Once the Company begins providing services, additional interest expense is recorded each period using the effective interest method, as well as corresponding additional revenue, which is recognized ratably over the service period. As of December 31, 2020, $405.2 million related to reimbursable costs associated with the FCC Final Order were included within contract liabilities, net of current portion on our consolidated balance sheets. For the years ended December 31, 2019 and 2020, we recognized revenue of $249.5 million and $237.4 million, respectively, that were included in the contract liability balances as of January 1, 2019 and 2020, respectively. In addition, the total amount of consideration included in contract assets as of January 1, 2019 and 2020 that became unconditional for each of the years ended December 31, 2019 and 2020 was $9.1 million and $15.1 million, respectively. Assets Recognized from the Costs to Obtain a Customer Contract We recognize an asset for the incremental costs of obtaining a contract with a customer if we expect the benefit of those costs to be longer than one year. We have determined that our sales incentive program meets the requirements to be capitalized due to the incremental nature of the costs and the expectation that the Company will recover such costs. The assets recognized from the costs to obtain a customer contract are amortized over a period that is consistent with the transfer to the customer of the services to which the asset relates. Additionally, we recognize an asset for the costs to obtain Supplemental Type Certificates (“STCs”) and Line Fit Certificates (“LFCs”), which is a regulatory requirement that must be satisfied prior to installation of equipment on the aircraft and remains an operational requirement throughout the duration of the contract. We capitalize all costs to obtain STCs and LFCs to the extent recoverable by contract revenue as costs to fulfill a customer contract. All STCs and LFCs will be amortized over the contract term (including anticipated renewals) and periodically tested for impairment. We capitalized $7.9 million and $5.9 million for costs to obtain a customer contract and amortized $5.9 million and $5.0 million for the years ended December 31, 2019 and 2020, respectively. As of December 31, 2019 and 2020, capitalized costs to obtain a customer contract amounted to $9.4 million and $10.4 million, respectively, and were included within other assets in our consolidated balance sheets. Contract Modifications Contracts are often modified to account for changes in contract specifications or requirements. We consider contract modifications to exist when the modification either creates new rights or obligations or changes the existing enforceable rights and obligations of either party. Most of our contract modifications are for goods and services that are distinct from the existing contract, as they consist of additional months of service priced at the Company’s standalone selling prices of the additional services and are therefore treated as separate contracts. For contract modifications that do not result in additional distinct goods or services, the effect of a contract modification on the transaction price and our measure of progress for the performance obligation to which it relates, is recognized as an adjustment to revenue. Significant Judgments We occasionally enter into certain contracts in which the customer makes payments in advance of services to be delivered, which may be years in the future. The reasons for the prepayments in these contracts vary, but generally can be either for the customer’s benefit or for the Company’s benefit (such as the ability to use the cash received from the customer to pay for the construction of a satellite asset). The determination of whether contracts with a prepayment provision contain a significant financing component requires judgment. The Company makes this determination based on various factors, including the differences between the amount of promised consideration and cash selling prices, the length of time between payment and the transfer of services and prevailing interest rates in the market. While most satellite utilization contracts contain multiple performance obligations for each transponder service on different satellites, the service period for the different satellite utilization performance obligations is generally the same time period. In the event that the time period for multiple performance obligations is not the same, we allocate the total transaction price to each performance obligation in an amount based on the estimated relative standalone selling price of the promised good or service underlying such performance obligation. Judgment is required to determine the standalone selling price for each distinct performance obligation. In order to estimate standalone selling prices, we use an adjusted market assessment approach which involves an evaluation of the market and an estimate of the price that our customers are willing to pay, or an expected cost plus a margin approach. When more than one party is involved in providing goods or services to a customer, we generally recognize the transaction on a gross basis due to the level of control that we have prior to the transfer of the good or service. These arrangements include instances where we procure equipment from vendors and sell to third-party customers, when we enter into revenue sharing arrangements with other parties and when we purchase capacity for voice, data and video services provided by third-party commercial satellite operators for which the desired frequency type or geographic coverage is not available on our network. Our third-party capacity arrangements (off-network) are more significant and, in determining whether we are the principal or the agent in these arrangements, we consider whether or not we control the service before it is transferred to the customer. In this determination, we consider the definition of control as set forth in ASC 606-10-25-25. When we purchase satellite transponder capacity from a third party, we have the ability to direct the use of and obtain substantially all of the remaining benefits from the purchased capacity. We obtain the right to the service to be performed by the third party, which gives the Company the ability to direct that party to provide the service to the customer on the Company’s behalf. No other third party can direct the use of or obtain any benefits from the capacity. We also considered the factors in ASC 606-10-55-39 in the Company’s determination of control. In the vast majority of cases, when we resell capacity to third party customers, we are primarily responsible for the fulfillment of the services and acceptability of the service. Additionally, the Company has full discretion in establishing the pricing for transponder services with the customer and assumes the credit risk associated with capacity purchased from the third party. In the event the service is not acceptable to the customer, we are required to identify an alternative solution. Based on these considerations, we have concluded that we are the principal in the transaction for these arrangements. When these factors are not met, the Company recognizes revenue for third-party capacity arrangements on a net basis. Judgment is required in determining whether we are the principal or the agent in transactions involving third parties. Remaining Performance Obligations Our remaining performance obligation is our expected future revenue under existing customer contracts and includes both cancelable and non-cancelable contracts. Our remaining performance obligation was approximately $6.0 billion as of December 31, 2020. We assess the contract term of our cancelable contracts as the full stated term of the contract assuming each contract is not canceled since the termination penalty upon cancellation is substantive. As of December 31, 2020, the weighted average remaining customer contract life was approximately 4.0 years. Approximately 41%, 23%, and 36% of our total remaining performance obligation as of December 31, 2020 is expected to be recognized as revenue during 2021 and 2022, 2023 and 2024, and 2025 and thereafter, respectively. The amount included in the remaining performance obligation represents the full-service charge for the duration of the contract and does not include termination fees. The amount of the termination fees, which is not included in the remaining performance obligation amount, is generally calculated as a percentage of the remaining performance obligation associated with the contract. In certain cases of breach for non-payment or customer financial distress or bankruptcy, we may not be able to recover the full value of certain contracts or termination fees. Our remaining performance obligation includes 100% of the remaining performance obligation of our consolidated ownership interests, which is consistent with the accounting for our ownership interest in these entities. (b) Business and Geographic Segment Information We operate in a single industry segment in which we provide satellite services to our communications customers around the world. Our revenues are disaggregated by billing region, service type and customer set. Revenue by region is based on the locations of customers to which services are billed. Our satellites are in geosynchronous orbit, and consequently are not attributable to any geographic location. Of our remaining assets, substantially all are located in the United States. Gogo CA revenues are allocated to the geographic location where the airline is domiciled. The following table disaggregates revenue by billing region (in thousands, except percentages): Year Ended December 31, 2018 Year Ended December 31, 2019 Year Ended December 31, 2020 North America $ 1,112,774 51 % $ 1,078,100 52 % $ 1,019,248 53 % Europe 257,747 12 % 243,967 12 % 214,573 11 % Latin America and Caribbean 284,948 13 % 239,856 12 % 210,510 11 % Africa and Middle East 274,853 13 % 250,935 12 % 238,305 12 % Asia-Pacific 230,868 11 % 248,607 12 % 230,444 12 % Total $ 2,161,190 $ 2,061,465 $ 1,913,080 The following table disaggregates revenue by type of service (in thousands, except percentages): Year Ended December 31, 2018 Year Ended December 31, 2019 Year Ended December 31, 2020 On-Network Revenues Transponder services $ 1,570,278 73 % $ 1,468,791 71 % $ 1,372,773 72 % Managed services 393,264 18 % 374,026 18 % 298,638 15 % Channel 4,250 — % 2,400 — % 1,394 — % Total on-network revenues 1,967,792 91 % 1,845,217 89 % 1,672,805 87 % Off-Network and Other Revenues Transponder, MSS and other off-network services 150,186 7 % 175,602 9 % 182,393 10 % Satellite-related services 43,212 2 % 40,646 2 % 42,297 2 % Total off-network and other revenues 193,398 9 % 216,248 11 % 224,690 12 % In-Flight Services Revenues Services — — % — — % 14,122 1% Equipment — — % — — % 1,463 —% Total in-flight services revenue — — % — — % 15,585 1% Total $ 2,161,190 $ 2,061,465 $ 1,913,080 By customer application, our revenues from network services, media, government and satellite-related services were $798.1 million, $937.7 million, $392.0 million and $33.4 million, respectively, for the year ended December 31, 2018; $770.4 million, $883.0 million, $378.3 million and $29.8 million, respectively, for the year ended December 31, 2019; and $677.4 million, $812.5 million, $392.6 million and $30.6 million, respectively, for the year ended December 31, 2020. Our largest customer accounted for approximately 11%, 14% and 14% of our revenue for the years ended December 31, 2018, 2019 and 2020, respectively. Our ten largest customers accounted for approximately 37%, 41% and 42% of our revenue for the years ended December 31, 2018, 2019 and 2020, respectively. |
Net Loss per Share
Net Loss per Share | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Net Loss per Share | Net Loss per Share Basic net loss per common share attributable to Intelsat S.A. (“EPS”) is computed by dividing net loss attributable to Intelsat S.A.’s common shareholders by the weighted average number of common shares outstanding during the periods. Diluted EPS assumes the issuance of common shares pursuant to share-based compensation plans and conversion of the Intelsat S.A. 4.5% Convertible Senior Notes due 2025 (the “2025 Convertible Notes”), unless the effect of such issuances would be anti-dilutive . The following table sets forth the computation of basic and diluted EPS (in thousands, except per share data or where otherwise noted): Year Ended December 31, 2018 Year Ended December 31, 2019 Year Ended December 31, 2020 Numerator: Net loss attributable to Intelsat S.A. $ (599,605) $ (913,595) $ (911,664) Denominator: Basic weighted average shares outstanding (in millions) 129.6 140.4 142.0 Diluted weighted average shares outstanding (in millions): 129.6 140.4 142.0 Basic EPS $ (4.63) $ (6.51) $ (6.42) Diluted EPS $ (4.63) $ (6.51) $ (6.42) In June 2018, Intelsat S.A. completed an offering of $402.5 million aggregate principal amount of its 2025 Convertible Notes. We do not expect to settle the principal amount of the 2025 Convertible Notes in cash, and therefore use the if-converted method for calculating any potential dilutive effect of the conversion on diluted EPS, if applicable. Under the indenture governing the 2025 Convertible Notes (the “2025 Indenture”), the 2025 Convertible Notes are eligible for conversion depending upon the trading price of our common shares and under other conditions set forth in the indenture until December 15, 2024, and thereafter without regard to any conditions. The commencement of the Chapter 11 Cases constituted an event of default under the 2025 Indenture. See Note 12—Debt for additional information on the impact of the Chapter 11 Cases on our debt obligations. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Recurring Fair Value Measurements The tables below present assets measured and recorded at fair value in our consolidated balance sheets on a recurring basis and their corresponding level within the fair value hierarchy (in thousands). No transfers between Level 1, Level 2 and Level 3 fair value measurements occurred for the years ended December 31, 2019 and 2020. Fair Value Measurements at December 31, 2019 As of December 31, 2019 (Level 1) (Level 2) (Level 3) Assets Marketable securities (1) $ 5,145 $ 5,145 $ — $ — Undesignated interest rate cap contracts (2) 372 — 372 — Common stock warrant (3) 3,239 — — 3,239 Total assets $ 8,756 $ 5,145 $ 372 $ 3,239 Fair Value Measurements at December 31, 2020 As of December 31, 2020 (Level 1) (Level 2) (Level 3) Assets Marketable securities (1) $ 5,205 $ 5,205 $ — $ — Common stock warrant (3) 3,239 — — 3,239 Total assets $ 8,444 $ 5,205 $ — $ 3,239 (1) The valuation measurement inputs of these marketable securities represent unadjusted quoted prices in active markets and, accordingly, we have classified such investments as Level 1 within the fair value hierarchy. The cost basis of our marketable securities was $4.3 million and $4.0 million as of December 31, 2019 and 2020, respectively. We sold marketable securities with a cost basis of $0.7 million and $0.6 million for the years ended December 31, 2019 and 2020, respectively, resulting in a gain of $0.2 million for each of the years ended December 31, 2019 and 2020, which is included within other income (expense), net in our consolidated statements of operations. (2) The valuation of our interest rate derivative instruments reflects the fair value of premiums paid, taking into account observable inputs including current interest rates, the market expectation for future interest rate volatility and current creditworthiness of the counterparties. As a result, we have determined that the valuation in its entirety is classified as Level 2 within the fair value hierarchy. (3) We valued the common stock warrant using a valuation technique that reflects the risk-free interest rate, time to maturity and volatility of comparable companies. We identified the inputs used to calculate the fair value as Level 3 inputs and concluded that the valuation in its entirety is classified as Level 3 within the fair value hierarchy. The following table presents a reconciliation of the preferred and common stock warrants which are measured and recorded at fair value on a recurring basis using Level 3 inputs (in thousands): Year Ended December 31, 2019 Year Ended December 31, 2020 Balance as of beginning of period $ 4,100 $ 3,239 Purchase of investments 3,239 — Unrealized loss included in other income (expense), net (4,100) — Balance as of end of period $ 3,239 $ 3,239 Nonrecurring Fair Value Measurements The carrying values of certain assets may be adjusted to fair value in subsequent periods on a nonrecurring basis if an event occurs or circumstances change that indicate that the asset is impaired or, for investments in equity securities without readily determinable fair values, observable transactions for identical or similar investments of the same issuer support a change in the investment fair value. For the year ended December 31, 2019, we recorded net impairment charges on certain investments in equity securities without readily determinable fair values. See Note 10—Investments for additional information related to these fair value measurements. For the year ended December 31, 2020, as a result of our interim and annual impairment assessments, we recognized impairments of non-amortizable intangible assets of $157.9 million. This fair value measurement is classified as Level 3 within the fair value hierarchy due to the use of significant unobservable inputs. See Note 11—Goodwill and Other Intangible Assets for additional information. Other Fair Value Disclosures See Note 10—Investments, Note 11—Goodwill and Other Intangible Assets and Note 12—Debt for fair value disclosures related to our loan receivables, impairment analysis and debt, respectively. The carrying amounts of the Company's other financial instruments are reasonable estimates of their related fair values due to their short-term nature. |
Retirement Plans and Other Reti
Retirement Plans and Other Retiree Benefits | 12 Months Ended |
Dec. 31, 2020 | |
Retirement Benefits [Abstract] | |
Retirement Plans and Other Retiree Benefits | Retirement Plans and Other Retiree Benefits (a) Pension and Other Postretirement Benefits We maintain a noncontributory defined benefit retirement plan covering substantially all of our employees hired prior to July 19, 2001. The cost of providing benefits to eligible participants under the defined benefit retirement plan is calculated using the plan’s benefit formulas, which take into account the participants’ remuneration, dates of hire, years of eligible service and certain actuarial assumptions. In addition, as part of the overall medical plan, we provide postretirement medical benefits to certain current retirees who meet the criteria under the medical plan for postretirement benefit eligibility. In 2015, we amended the defined benefit retirement plan to end the accrual of additional benefits for the remaining active participants. We have received authorization from the Bankruptcy Court to continue making contributions in the ordinary course during our Chapter 11 Cases. The defined benefit retirement plan is subject to the provisions of the Employee Retirement Income Security Act of 1974, as amended. We expect that our future contributions to the defined benefit retirement plan will be based on the minimum funding requirements of the Internal Revenue Code and on the plan’s funded status. Any significant decline in the fair value of our defined benefit retirement plan assets or other adverse changes to the significant assumptions used to determine the plan’s funded status would negatively impact its funded status and could result in increased funding in future years. The impact on the funded status is determined based upon market conditions in effect when we completed our annual valuation. We anticipate that our contributions to the defined benefit retirement plan in 2021 will be approximately $5.8 million. We fund the postretirement medical benefits throughout the year based on benefits paid. We anticipate that our contributions to fund postretirement medical benefits in 2021 will be approximately $2.6 million. Prior service credits and actuarial losses are reclassified from accumulated other comprehensive loss to net periodic pension benefit costs, which are included in other income (expense), net on our consolidated statements of operations. All amounts recorded in accumulated other comprehensive loss are being recognized as net periodic benefit cost or benefit over the average remaining life expectancy of plan participants. Reconciliation of Funded Status and Accumulated Benefit Obligation. Intelsat uses December 31 as the measurement date for its defined benefit retirement plan. The following table summarizes the projected benefit obligations, plan assets and funded status of the defined benefit retirement plan, as well as the projected benefit obligations of the postretirement medical benefits provided under our medical plan (in thousands, except percentages): Year Ended December 31, 2019 Year Ended December 31, 2020 Pension Other Post- Pension Other Post- Change in benefit obligation Benefit obligation at beginning of year $ 394,082 $ 40,526 $ 423,536 $ 39,875 Interest cost 15,390 1,532 11,850 1,064 Employee contributions — 181 — 157 Plan amendments — — — — Benefits paid (24,875) (1,787) (26,350) (1,920) Actuarial net (gain) loss (1) 38,939 (577) 42,917 (2,343) Benefit obligation at end of year $ 423,536 $ 39,875 $ 451,953 $ 36,833 Change in plan assets Plan assets at beginning of year $ 297,631 $ — $ 334,821 $ — Employer contributions 4,232 1,606 3,971 1,763 Employee contributions — 181 — 157 Actual return on plan assets 57,833 — 43,633 — Benefits paid (24,875) (1,787) (26,350) (1,920) Plan assets at fair value at end of year $ 334,821 $ — $ 356,075 $ — Accrued benefit costs and funded status of the plans $ (88,715) $ (39,875) $ (95,878) $ (36,833) Accumulated benefit obligation $ 423,536 $ 451,953 Weighted average assumptions used to determine accumulated benefit obligation and accrued benefit costs Discount rate 3.29 % 3.19 % 2.41 % 2.28 % Weighted average assumptions used to determine net periodic benefit costs Discount rate 4.35 % 4.27 % 3.29 % 3.19 % Expected rate of return on plan assets 7.60 % — 7.60 % — Amounts in accumulated other comprehensive loss recognized in net periodic benefit cost Actuarial net (gain) loss, net of tax $ 4,151 $ (1,208) $ 6,295 $ (1,200) Prior service credits, net of tax — (2,502) — (2,504) Total $ 4,151 $ (3,710) $ 6,295 $ (3,704) Amounts in accumulated other comprehensive loss not yet recognized in net periodic benefit cost Actuarial net (gain) loss, net of tax $ 111,637 $ (16,646) $ 127,497 $ (17,746) Prior service credits, net of tax — (30,011) — (27,508) Total $ 111,637 $ (46,657) $ 127,497 $ (45,254) (1) For 2020, the actuarial loss impacting the pension benefit obligation was primarily due to lower discount rates at the end of 2020 compared to the end of 2019. The gain impacting the postretirement plan was mainly due to a previously assumed inflation adjustment to Health Reimbursement Accounts (“HRAs”) that is not to be provided in 2021, as well as favorable claims experience. The gain was partially offset by lower discount rates. For 2019, the actuarial loss impacting the pension benefit obligation was primarily due to lower discount rates at the end of 2019 compared to the end of 2018. The gain impacting the postretirement plan was mainly due to a lower assumption of claims and HRA stipends to be paid to beneficiaries, and favorable claims experience due to lower enrollment. The gain was partially offset by lower discount rates. Our benefit obligations are determined by discounting each future year's expected benefit cash flow using the corresponding spot rates along a yield curve that is derived from the monthly bid-price data of bonds that are rated high grade by either Moody’s Investor Service or Standard and Poor’s Rating Services. The bond types included are noncallable bonds, private placement bonds that are traded among qualified institutional buyers and are at least two years from date of issuance, bonds with a make-whole provision, and bonds issued by foreign corporations that are denominated in U.S. dollars. Excluded are bonds that are callable (starting in 2020, we include bonds that are callable at par within 6 months of maturity, where the time to maturity is 10 years or greater), sinkable and puttable as well as those for which the quoted yield-to-maturity is zero. For bonds in this universe that have a yield higher than the regression mean yield curve for the full universe, regression analysis is used to determine the best-fitting curve, which gives a good fit to the data at both long and short maturities. The resulting regressed coupon yield curve is smoothed continuously along its entire length and represents an unbiased average of the observed market data. Interest rates used in these valuations are key assumptions, including discount rates used in determining the present value of future benefit payments and expected return on plan assets, which are reviewed and updated on an annual basis. The discount rates reflect market rates for high-quality corporate bonds. We consider current market conditions, including changes in interest rates, in making assumptions. The Society of Actuaries (“SOA”) published mortality tables for private retirement plans (“Pri-2012”) and a mortality improvement scale in each of 2019 (“MP-2019”) and 2020 (“MP-2020”). The most significant element of MP-2020 is an update to the long-term mortality improvement assumption bringing it closer to the assumption that we had previously used for our December 31, 2019 valuation based on our actuary’s mortality scales. Accordingly, our December 31, 2020 valuation is based on Pri-2012 and MP-2019, adjusted to reflect (1) an ultimate rate of mortality improvement consistent with both historical experience and U.S. Social Security long-term projections, and (2) a shorter transition period to reach the ultimate rate, which is consistent with historical patterns. In establishing the expected return on assets assumption, we review the asset allocations considering plan maturity and develop return assumptions based on different asset classes. The return assumptions are established after reviewing historical returns of broader market indexes, as well as historical performance of the investments in the plan. Our pension plan assets are managed in accordance with an investment policy, as discussed below. Plan Assets. The investment policy of the plan includes target allocation percentages of approximately 49% for investments in equity securities (29% U.S. equities and 20% non-U.S. equities), 36% for investments in fixed income securities and 15% for investments in other securities, which is broken down further into 5% for investments in hedge fund of funds and 10% for investments in real estate fund of funds. Plan assets include investments in both U.S. and non-U.S. equity funds. Fixed income investments include a long duration bond fund, a high yield bond fund and an emerging markets debt fund. The funds in which the plan’s assets are invested are institutionally managed and have diversified exposures into multiple asset classes implemented with over 50 investment managers. The guidelines and objectives of the funds are congruent with the Intelsat investment policy statement. The target and actual asset allocation of our pension plan assets were as follows: As of December 31, 2019 As of December 31, 2020 Target Actual Target Actual Equity securities 49 % 48 % 49 % 48 % Debt securities 36 % 34 % 36 % 35 % Other securities 15 % 18 % 15 % 17 % Total 100 % 100 % 100 % 100 % The fair values of our pension plan assets by asset category were as follows (in thousands): Fair Value Measurements at December 31, 2019 Level 1 Level 2 Level 3 Equity Securities U.S. Large-Cap (1) $ 75,380 $ 75,380 $ — $ — U.S. Small/Mid-Cap (2) 19,566 19,566 — — World Equity Ex-U.S. (3) 65,882 65,882 — — Fixed Income Securities Long Duration Bonds (4) 95,327 95,327 — — High Yield Bonds (5) 9,610 9,610 — — Emerging Market Fixed Income (Non-U.S.) (6) 9,720 9,720 — — Other Securities $ 275,485 $ — $ — Hedge Funds (7) 18,803 Core Property Fund (8) 40,205 Income earned but not yet received 328 Total $ 334,821 Fair Value Measurements at December 31, 2020 Level 1 Level 2 Level 3 Equity Securities U.S. Large-Cap (1) $ 79,619 $ 79,619 $ — $ — U.S. Small/Mid-Cap (2) 20,569 20,569 — — World Equity Ex-U.S. (3) 69,736 69,736 — — Fixed Income Securities Long Duration Bonds (4) 103,827 103,827 — — High Yield Bonds (5) 10,352 10,352 — — Emerging Market Fixed Income (Non-U.S.) (6) 10,376 10,376 — — Other Securities $ 294,479 $ — $ — Hedge Funds (7) 20,263 Core Property Fund (8) 41,036 Cash and income earned but not yet received 297 Total $ 356,075 (1) U.S. Large-Cap Equity includes investments in funds that invest primarily in a portfolio of common stocks included in the S&P 500 Index, as well as other equity securities and derivative instruments whose value is derived from the performance of the S&P 500. (2) U.S. Small/Mid-Cap includes investments in funds that (1) invest primarily in U.S. small- and mid-cap stocks with market capitalization ranges similar to those found in the FTSE Russell 2500 Index, or (2) aim to produce investment results that correspond to the performance of the FTSE/Russell Small Cap Completeness Index. (3) World Equity Ex-U.S. includes an investment in a fund that invests primarily in common stocks and other equity securities whose issuers comprise a broad range of capitalizations and that are located outside of the U.S. The fund invests primarily in developed countries but may also invest in emerging markets. (4) Long Duration Bonds includes an investment in a fund that invests primarily in long-duration government and corporate fixed income securities and uses derivative instruments (including interest rate swaps and U.S. Treasury futures contracts) for the purpose of managing the overall duration and yield curve exposure of the fund's portfolio. (5) High Yield Bonds includes an investment in a fund that seeks to maximize return by investing primarily in a diversified portfolio of higher yielding, lower rated fixed income securities. The fund will invest primarily in securities rated below investment grade, including corporate bonds, convertible and preferred securities and zero coupon obligations. (6) Emerging Markets Fixed Income (Non-U.S.) includes an investment in a fund that seeks to maximize return by investing in fixed income securities of emerging markets issuers. The fund will invest primarily in U.S. dollar denominated debt securities of government, government-related and corporate issuers in emerging market countries, as well as entities organized to restructure the outstanding debt of such issuers. (7) Hedge Funds includes an investment in a collective trust fund that seeks to provide returns that are different from (less correlated with) investments in more traditional asset classes. The fund will pursue its investment objective by investing substantially all of its assets in various hedge funds. The fund has semi-annual redemptions in June and December with a pre-notification period of 95 days, and a two year lock-up on all purchases which have expired. (8) The Core Property Fund is a collective trust fund that invests in direct commercial property funds primarily in the U.S. The fund is meant to provide current income-oriented returns, diversification, and modest inflation protection to an overall investment portfolio. Total returns are expected to be somewhere between stocks and bonds, with moderate volatility and low correlation to public markets. The fund has quarterly redemptions with a pre-notification period of 95 days, and no lock-up period. Our plan assets are measured at fair value. ASC 820 prioritizes the inputs used in valuation techniques including Level 1, Level 2 and Level 3 (see Note 1(d)—Background and Summary of Significant Accounting Policies—Fair Value Measurements). The majority of our plan assets are valued using measurement inputs which include unadjusted prices in active markets and we have therefore classified these assets as Level 1 within the fair value hierarchy. Our other securities include Hedge Funds and Core Property Funds, which are measured at fair value using the net asset value per share practical expedient, and are not classified in the fair value hierarchy. Net periodic pension income included the following components (in thousands): Year Ended December 31, 2018 Year Ended December 31, 2019 Year Ended December 31, 2020 Interest cost $ 14,428 $ 15,390 $ 11,850 Expected return on plan assets (24,482) (23,490) (23,242) Amortization of unrecognized net loss 5,307 4,221 6,399 Total income $ (4,747) $ (3,879) $ (4,993) We had accrued benefit costs at December 31, 2019 and 2020 of $88.7 million and $95.9 million, respectively, related to the pension benefits, of which $0.6 million and $0.7 million were recorded within other current liabilities for the years ended December 31, 2019 and 2020, respectively, and $88.1 million and $95.2 million were recorded in other long-term liabilities, respectively. Net periodic other postretirement benefit costs (income) included the following components (in thousands): Year Ended December 31, 2018 Year Ended December 31, 2019 Year Ended December 31, 2020 Interest cost $ 2,314 $ 1,532 $ 1,064 Amortization of prior service credit (854) (2,544) (2,545) Amortization of unrecognized net gain (630) (1,229) (1,220) Total costs (income) $ 830 $ (2,241) $ (2,701) We had accrued benefit costs at December 31, 2019 and 2020 related to the other postretirement benefits of $39.9 million and $36.8 million, respectively, of which $2.9 million and $2.6 million were recorded in other current liabilities, respectively, and $37.0 million and $34.2 million were recorded in other long-term liabilities, respectively. Depending on our actual future health care claims, our actual costs may vary significantly from those projected above. As of December 31, 2019 and 2020, the assumed health care cost trend rates for retirees who are not eligible for Medicare were 6.0% and 5.7%, respectively. These rates are expected to decrease annually to an ultimate rate of 4.5% by December 31, 2038. Effective January 1, 2019, Medicare eligible retirees and spouses receive an annual stipend in the form of a contribution to a HRA to be used as a reimbursement for qualified health care costs. Therefore, the value of the benefits provided to these participants is not affected by the assumed health care cost trend rate. While the terms of the plan do not guarantee increases to the stipend, the Company intends to evaluate the stipend annually. When valuing the benefit obligation as of December 31, 2020, we assumed no increase to the subsidy in fiscal year 2021 and 3.0% annual increases to the subsidy beginning in fiscal year 2022. When valuing the benefit obligation as of December 31, 2019, we assumed no increase to the subsidy in fiscal year 2020 and 3.0% annual increases beginning in fiscal year 2021. The benefits expected to be paid in each of the next five years and in the aggregate for the five years thereafter are as follows (in thousands): Pension Other Post- 2021 $ 42,185 $ 2,605 2022 28,969 2,609 2023 28,509 2,546 2024 27,146 2,492 2025 26,457 2,411 2026 to 2030 123,572 11,029 Total $ 276,838 $ 23,692 (b) Other Retirement Plans We maintain a defined contribution retirement plan, qualified under the provisions of Section 401(k) of the Internal Revenue Code, for our employees in the United States. We recognized compensation expense for this plan of $7.9 million, $8.1 million and $8.9 million for the years ended December 31, 2018, 2019 and 2020, respectively. We also maintain other defined contribution retirement plans in several non-U.S. jurisdictions, but such plans are not material to our financial position or results of operations. |
Satellites and Other Property a
Satellites and Other Property and Equipment | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Satellites and Other Property and Equipment | Satellites and Other Property and Equipment (a) Satellites and Other Property and Equipment, net Satellites and other property and equipment, net were comprised of the following (in thousands): As of December 31, 2019 As of December 31, 2020 Satellites and launch vehicles $ 10,407,690 $ 10,500,021 Information systems and ground segment 968,482 1,062,216 Buildings and other 280,109 322,093 Total cost 11,656,281 11,884,330 Less: accumulated depreciation (6,954,218) (7,126,453) Total $ 4,702,063 $ 4,757,877 Satellites and other property and equipment are stated at historical cost, except for satellites that have been impaired. Satellites and other property and equipment acquired as part of an acquisition are stated based on their fair value at the date of acquisition. During the first quarter of 2020, the price of our common shares and trading values of our debt securities experienced sustained reductions. We also witnessed certain declines in financial performance as compared to previously prepared internal budget and forecast projections. Among the impacts of the COVID-19 pandemic were a reduction of revenue and a decreased likelihood of collection from certain mobility customers. Based on our examination of these and other qualitative factors, we concluded that further testing of satellites and other property and equipment was required. During the fourth quarter of 2020, due to additional declines in forecast projections, we concluded that further testing of satellites and other property and equipment was required. The Company evaluated the assets for potential impairment using internal projections of undiscounted cash flows expected to result from the use and eventual disposal of the assets. If the carrying amount of the assets exceeds the undiscounted cash flows expected to result from its use, an impairment expense is recognized for the amount by which the carrying amount of the asset group exceeds its fair value. The impairment expense cannot exceed the carrying amount of the long-lived assets (unless the carrying amount is not being reduced below fair value for any individual long-lived asset that is determinable without undue cost and effort). In estimating the undiscounted cash flows, we primarily used our internally prepared budgets and forecast information. The key assumptions included in our model were projected growth rates, cost of capital, effective tax rates, and industry and economic trends. A change in estimated future cash flows or other assumptions could change our estimated fair values and result in future impairments. The conclusion of both of our analyses was that the undiscounted cash flows of the asset group were greater than its carrying value, resulting in no impairment. Satellites and other property and equipment, net of accumulated depreciation as of December 31, 2019 and 2020 included construction-in-progress of $191.5 million and $768.6 million, respectively. These amounts relate primarily to satellites under construction and related launch services. As of December 31, 2020, we incurred C-band clearing related costs and expenses of $505.3 million, of which $471.7 million is capitalized. Of this capitalized amount, $432.5 million and $39.2 million is capitalized as satellites and other property and equipment, net of accumulated depreciation, and other current assets, respectively, in the consolidated balance sheets. An estimated $466.9 million of the capitalized costs is expected to be reimbursable under the FCC Final Order. Interest costs of $31.5 million and $35.0 million were capitalized for the years ended December 31, 2019 and 2020, respectively. Additionally, depreciation expense was $649.1 million, $623.3 million and $618.5 million for the years ended December 31, 2018, 2019 and 2020, respectively. We have entered into launch contracts for the launch of both specified and unspecified future satellites. Each of these launch contracts may be terminated at our option, subject to payment of a termination fee that increases as the applicable launch date approaches. In addition, in the event of a failure of any launch, we may exercise our right to obtain a replacement launch within a specified period following our request for re-launch. During the second quarter of 2020, the Company deemed it unlikely that it will be able to utilize certain satellite and launch vehicle deposits prior to their respective expiration dates. As a result, the Company recorded a non-cash impairment charge of $34.0 million related to the impairment of the carrying values of the deposits, which is included within impairment of non-amortizable intangible and other assets in the consolidated statements of operations. (b) Satellite Launches Galaxy 30, the first satellite in Intelsat’s Galaxy fleet refresh plan, was successfully launched on August 15, 2020. Galaxy 30 replaced Galaxy 14 at 125ºW serving media customers in the North America region. Galaxy 30 is the first four-frequency Intelsat satellite with C-, Ku-, Ka- and L-band capabilities. In addition, Galaxy 30 offers broadband, mobility and network services to mobile network, enterprise and government customers in the North America region. The satellite will also play an important role in the Company’s U.S. C-band spectrum transition plan. Galaxy 30 entered into service in February 2021. Intelsat 39 was successfully launched on August 6, 2019. Intelsat 39 replaced Intelsat 902 at the 62ºE location and delivers connectivity services in both the C- and Ku-bands to mobile network operators, enterprises and government customers, as well as aeronautical and maritime mobility service providers operating in the Europe, Africa, Middle East and Asia-Pacific regions. Intelsat 39 entered into service in October 2019. (c) Significant Anomalies In April 2019, the Intelsat 29e satellite (in service since 2016) experienced an anomaly that resulted in a total loss of the satellite. In accordance with our existing satellite anomaly contingency plans, we restored service for most Intelsat 29e customers on other satellites in our network, as well as on third-party satellites. We recorded a non-cash impairment charge of $381.6 million in the second quarter of 2019, of which $377.9 million related to the write off of the carrying value of the satellite and associated deferred performance incentive obligations and $3.7 million related to prepaid regulatory fees. A Failure Review Board comprised of the satellite’s manufacturer, Boeing Satellite Systems, Inc., the Company and external independent experts was convened to complete a comprehensive analysis of the cause of the anomaly. The board concluded that the anomaly was caused by either a harness flaw in conjunction with an electrostatic discharge event related to solar weather activity, or the impact of a micrometeoroid. (d) Satellite Health Our satellite fleet is diversified by manufacturer and satellite type, and as a result, our fleet is generally healthy. We have experienced some technical problems with our current fleet but have been able to minimize the impact of these problems on our customers, our operations and our business in recent years. Many of these problems have been component failures and anomalies that have had little long-term impact to date on the overall transponder availability in our satellite fleet. All of our satellites have been designed to accommodate an anticipated rate of equipment failures with adequate redundancy to meet or exceed their orbital design lives, and to date, this redundancy design scheme has proven effective. After each anomaly we have generally restored services for our customers on the affected satellite, provided alternative capacity on other satellites in our fleet, or provided capacity that we purchased from other satellite operators. |
Investments
Investments | 12 Months Ended |
Dec. 31, 2020 | |
Investments, All Other Investments [Abstract] | |
Investments | Investments We have an ownership interest in two entities that meet the criteria of a VIE: Horizons Satellite Holdings LLC (“Horizons Holdings”) and Horizons-3 Satellite LLC (“Horizons 3”), which are discussed in further detail below, including our analyses of the primary beneficiary determination as required under ASC 810, Consolidation (“ASC 810”). We also own noncontrolling investments in equity securities and loan receivables as discussed further below. (a) Horizons Holdings Horizons Holdings is a joint venture with JSAT International Inc. (“JSAT”) that consists of two investments: Horizons-1 Satellite LLC and Horizons-2 Satellite LLC. Horizons Holdings borrowed from JSAT a portion of the funds necessary to finance the construction of the Horizons 2 satellite pursuant to a loan agreement. The borrowing was subsequently repaid. We provide certain services to the joint venture and in return utilize capacity from the joint venture. We have determined that this joint venture meets the criteria of a VIE under ASC 810, and we have concluded that we are the primary beneficiary because decisions relating to any future relocation of the Horizons 2 satellite, the most significant asset of the joint venture, are effectively controlled by us. In accordance with ASC 810, as the primary beneficiary, we consolidate Horizons Holdings within our consolidated financial statements. Total assets of Horizons Holdings were $22.2 million and $14.2 million as of December 31, 2019 and 2020, respectively. Total liabilities were nominal as of December 31, 2019 and 2020. We have a revenue sharing agreement with JSAT related to services sold on the Horizons 1 and Horizons 2 satellites. We are responsible for billing and collection for such services, and we remit 50% of the revenue, less applicable fees and commissions, to JSAT. Amounts payable to JSAT related to the revenue sharing agreement, net of applicable fees and commissions, from the Horizons 1 and Horizons 2 satellites were $1.6 million and $1.8 million as of December 31, 2019 and 2020, respectively. (b) Horizons-3 Satellite LLC On November 4, 2015, we entered into an additional joint venture agreement with JSAT. The joint venture, Horizons 3, was formed for the purpose of developing, launching, managing, operating and owning a high-performance satellite located at the 169ºE orbital location. Horizons 3, which is 50% owned by each of Intelsat and JSAT, was set up with a joint share of management authority and equal rights to profits and revenues from the joint venture. Similar to Horizons Holdings, we have a revenue sharing agreement with JSAT related to services sold on the Horizons 3e satellite. In addition, we are responsible for billing and collection for such services, and we remit 50% of the revenue, less applicable fees and commissions, to JSAT. Amounts payable to JSAT related to the revenue sharing agreement, net of applicable fees and commissions, from the Horizons 3e satellite were $3.3 million and $5.0 million as of December 31, 2019 and 2020, respectively. We have determined that this joint venture meets the criteria of a VIE under ASC 810, however we have concluded that we are not the primary beneficiary and therefore do not consolidate Horizons 3. The assessment considered both quantitative and qualitative factors, including an analysis of voting power and other means of control of the joint venture as well as each owner’s exposure to risk of loss or gain. Because we and JSAT equally share control over the operations of the joint venture and also equally share exposure to risk of losses or gains, we concluded that we are not the primary beneficiary of Horizons 3. Our investment, included within other assets in our consolidated balance sheets, is accounted for using the equity method of accounting. The investment balance, which is equivalent to our maximum exposure to loss, was $110.2 million and $103.8 million as of December 31, 2019 and 2020, respectively. The investment balance exceeded our equity in the net assets of Horizons 3 by $11.6 million and $10.9 million as of December 31, 2019 and 2020, respectively. This basis difference represents the capitalized interest that we incurred in relation to financing our investment and we recognize it as a reduction of our equity in earnings of Horizons 3 on a straight-line basis over the life of the satellite. We recognized a nominal amount of equity in earnings or losses of Horizons 3 in other income (expense), net for each of the years ended December 31, 2018, 2019 and 2020. In connection with our investment in Horizons 3, we entered into a capital contribution and subscription agreement which requires us to fund our 50% share of the amounts due in order to maintain our respective 50% interest in the joint venture. Pursuant to this agreement, we made contributions of $41.2 million, $5.0 million and $2.7 million for the years ended December 31, 2018, 2019 and 2020, respectively. We received distributions of $5.0 million and $9.0 million for the years ended December 31, 2019 and 2020, respectively, with no comparative amounts in 2018. The Company utilizes the cumulative earnings approach to determine whether distributions received from equity method investees are returns on investment or returns of investment. In addition, our indirect subsidiary that holds our investment in Horizons 3 has entered into a security and pledge agreement with Horizons 3, pursuant to which it has granted a security interest in its membership interest in Horizons 3. Further, our indirect subsidiary has granted a security interest to Horizons 3 in its customer capacity contracts and its ownership interest in its wholly-owned subsidiary that holds the FCC license required for the joint venture’s operations. The Horizons 3e satellite entered into service in January 2019. The Company purchases satellite capacity and related services from the Horizons 3 joint venture, and then sells that capacity to its customers. We incurred direct costs of revenue related to these purchases of $19.9 million and $19.0 million for the years ended December 31, 2019 and 2020, respectively, with no comparative amounts in 2018. The Company also sells managed ground network services to the Horizons 3 joint venture and provides program management services for a fee. We recorded an offset to direct costs of revenue of $5.6 million and $7.0 million related to the provision of these services for the years ended December 31, 2019 and 2020, respectively, with no comparative amounts in 2018. On the consolidated balance sheet as of December 31, 2019, $0.5 million due from Horizons 3 was included in receivables with no comparable amount in 2020, and $1.7 million and $1.5 million due to Horizons 3 was included in accounts payable and accrued liabilities as of December 31, 2019 and 2020, respectively. (c) Investments in Equity Securities The Company holds noncontrolling equity investments in six separate privately held companies, including investments in equity securities without readily determinable fair values and common stock warrants. In accordance with ASC 321, Investments—Equity Securities, we use the measurement alternative to measure the fair value of our investments in equity securities without readily determinable fair values. Accordingly, these investments are measured at cost, less any impairment, and are adjusted for changes in fair value resulting from observable transactions for identical or similar investments of the same issuer. These investments are recorded in other assets in our consolidated balance sheets and had a total carrying value of $27.2 million and $31.9 million as of December 31, 2019 and 2020, respectively. We recognized impairment losses related to these investments of $36.8 million and $0.1 million for the years ended December 31, 2019 and 2020, respectively, with no comparative amounts in 2018. We recognized an increase in fair value relating to investments of $1.7 million for the year ended December 31, 2019, with no comparative amounts in 2020 or 2018. These changes, which are recognized in other income (expense), net in our consolidated statements of operations, were determined using Level 3 inputs including third-party valuations, private transactions and internal projections of future profitability. We measure our stock warrants at fair value (See Note 7—Fair Value Measurements and Note 13—Derivative Instruments and Hedging Activities for additional information). The warrants are recorded in other assets in our consolidated balance sheets and had a cumulative fair value of $3.2 million as of both of December 31, 2019 and 2020. (d) Loan Receivables The Company has loan receivables from three privately held companies that it is holding for long-term investment. These loan receivables are reported at amortized cost, net of the allowance for credit losses. Amortized cost is the outstanding principal, adjusted for unamortized discounts and deferred transaction costs. The Company recognizes interest income on loan receivables using the effective-interest method applied on a loan-by-loan basis. Direct costs associated with originating loans are offset against any related fees received and the balance, along with any premium or discount, is deferred and amortized as an adjustment to interest income over the term of the related loan receivable using the effective interest method. Loan receivables are recorded in other assets in our consolidated balance sheets at an amortized cost basis, net of allowance of credit losses, of $70.4 million and $71.2 million as of December 31, 2019 and 2020, respectively. These amounts were net of an allowance for loan losses of $4.6 million as of December 31, 2019 with no comparative amount as of December 31, 2020, unamortized discount of $3.0 million and $0.7 million as of December 31, 2019 and 2020, respectively, and unamortized deferred transaction costs of $1.0 million and $0.2 million as of December 31, 2019 and 2020, respectively. As of December 31, 2019 and 2020, $1.5 million and $1.9 million, respectively, of accrued interest related to our loan receivables was recorded in prepaid expenses and other current assets in our consolidated balance sheets. We recognized interest income related to our loan receivables of $1.5 million and $3.9 million for the years ended December 31, 2019 and 2020, respectively, with no comparative amounts in 2018. A loan is determined to be impaired and placed on non-accrual status when, in management’s judgment based on current information and events, it is probable that the Company will be unable to collect all amounts due under the contractual terms of the applicable loan agreement. We recognized impairment losses related to loan receivables of $4.6 million and $0.6 million for the years ended December 31, 2019 and 2020, respectively, with no comparable amounts in 2018. The fair value of loan receivables is evaluated on a loan-by-loan basis, and is determined based on assessments of discounted cash flows that are considered probable of collection. We consider these inputs to be Level 3 within the fair value hierarchy. The cumulative fair value of our loan receivables as of December 31, 2019 and 2020 was $69.3 million and $72.9 million, respectively. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets We account for goodwill and other non-amortizable intangible assets in accordance with ASC 350 and have deemed these assets to have indefinite lives. Therefore, these assets are not amortized but are tested on an annual basis for impairment during the fourth quarter, or whenever events or changes in circumstances indicate that the carrying amount may not be fully recoverable. During 2020, the price of our common shares and trading values of our debt securities experienced sustained reductions. We also witnessed certain declines in financial performance as compared to previously prepared internal budget and forecast projections. Among the impacts of the COVID-19 pandemic were a reduction of revenue and a decreased likelihood of collection from certain mobility customers. Based on our examination of these and other qualitative factors, we concluded that further testing of goodwill and other non-amortizable and amortizable intangible assets was required during the first and fourth quarters of 2020. Determining the fair value of a reporting unit and other intangible assets often involves the use of estimates and assumptions that require significant judgment, and that could have a substantial impact on whether or not an impairment charge is recognized and the magnitude of any such charge. Estimates of fair value are primarily determined using discounted cash flows and market transactions. These estimates involve making significant estimates and assumptions, including projected future cash flows (including timing), discount rates reflecting the risks inherent in future cash flows, perpetual growth rates, and the determination of appropriate market comparisons. (a) Goodwill For the analysis of goodwill, we applied ASU 2017-04, which is further described in Note 1—Background and Summary of Significant Accounting Policies. If the carrying amount of a reporting unit exceeds its fair value, an impairment loss shall be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. After recognizing the impairment loss, the loss establishes a new corresponding basis in the goodwill. Subsequent reversals of goodwill impairment losses are not permitted under applicable accounting standards. In the first quarter of 2020, Intelsat had only one reporting unit for purposes of the analysis of goodwill, and accordingly, the analysis was undertaken at the enterprise level. As a result of the Gogo Transaction, Intelsat had two reporting units for purposes of the analysis of goodwill as of December 31, 2020: Legacy Intelsat and the Gogo CA business. For the Gogo CA reporting unit, we used a qualitative approach to identify and consider the significance of relevant key factors, events, and circumstances that affect the fair value of the reporting unit. We make our qualitative evaluation considering, among other things, general macroeconomic conditions, industry and market considerations, cost factors, overall financial performance and other relevant entity-specific events. Based on our examination of the qualitative factors as of December 31, 2020, we concluded that there was not a likelihood of more than 50% that the fair value of the Gogo CA reporting unit was less than its carrying value; therefore, no further testing of goodwill was required. For the Legacy Intelsat reporting unit, we performed a quantitative assessment in the first and fourth quarters of 2020. We determined the estimated fair value of the reporting unit using a discounted cash flow analysis, along with independent source data related to comparative market multiples and, when available, recent transactions, each of which is considered a Level 3 input within the fair value hierarchy under ASC 820. The discounted cash flows were derived from a 6-year projection of cash flows plus a residual value, with the resulting projected cash flows discounted at an appropriate weighted average cost of capital. In estimating the undiscounted cash flows, we primarily used our internally prepared budgets and forecast information. The key assumptions included in our model were projected growth rates, cost of capital, effective tax rates, and industry and economic trends, along with the C-band spectrum Acceleration Payments as provided under the FCC Final Order, which we expect to receive subject to the satisfaction of certain deadlines and other conditions set forth therein, and the discount rate applied to those cash flows. The conclusion of our analyses in the first and fourth quarters of 2020 was that the fair value of the Legacy Intelsat reporting unit was greater than its carrying value, resulting in no impairment of goodwill. In the fourth quarter analysis, the fair value of the Legacy Intelsat reporting unit was greater than its carrying value by 0.9%. A change in estimated future cash flows or other assumptions could change our estimated fair values and result in future impairments. As a result of the Gogo Transaction, we recognized goodwill of $77.6 million. See Note 3—Acquisition of Gogo Commercial Aviation for additional discussion. The carrying amounts of goodwill consisted of the following (in thousands): As of December 31, 2019 As of December 31, 2020 Goodwill $ 6,780,827 $ 6,858,447 Accumulated impairment losses (4,160,200) (4,160,200) Net carrying amount $ 2,620,627 $ 2,698,247 (b) Orbital Locations, Trade Name and Other Intangible Assets Orbital Locations. Intelsat is authorized by governments to operate satellites at certain orbital locations—i.e., longitudinal coordinates along the Clarke Belt. The Clarke Belt is the part of space approximately 35,800 kilometers above the plane of the equator where geostationary orbit may be achieved. Various governments acquire rights to these orbital locations through filings made with the International Telecommunication Union, a sub-organization of the United Nations. We will continue to have rights to operate satellites at our orbital locations so long as we maintain our authorizations to do so. Our rights to operate at orbital locations can be used and sold individually; however, since satellites and customers can be and are moved from one orbital location to another, our rights are used in conjunction with each other as a network that can be adapted to meet the changing needs of our customers and market demands. Due to the interchangeable nature of orbital locations, the aggregate value of all of the orbital locations is used to measure the extent of impairment, if any. We determined the estimated fair value of our rights to operate at orbital locations by using the build-up method to determine cash flows for the income approach, with the resulting projected cash flows discounted at an appropriate weighted average cost of capital. Under the build-up approach, the amount a reasonable investor would be willing to pay for the right to operate a satellite business using orbital locations is calculated by first estimating the cash flows that typical market participants might assume could be available from the right to operate satellites using the subject location in a similar market. It is assumed that rather than acquiring such a business as a going concern, the buyer would hypothetically start with the right to operate satellites at orbital locations and build a new business with similar attributes from the beginning. Thus, the buyer is assumed to incur the start-up costs and losses typically associated with the going concern value and pay for all other tangible and intangible assets. The key assumptions used in estimating the fair values of our rights to operate at our orbital locations included the following: (i) market penetration leading to revenue growth, (ii) profit margin, (iii) duration and profile of the build-up period, (iv) estimated start-up costs and losses incurred during the build-up period and (v) weighted average cost of capital. We completed our analysis of the estimated fair value of our rights to operate at certain orbital locations in connection with the analysis of goodwill described above in the first quarter of 2020 and concluded that the fair value was greater than the carrying value, resulting in no impairment. Due to additional declines in forecast projections, during the analysis in the fourth quarter of 2020, we determined that the fair value was less than the carrying value, resulting in an impairment charge of $137.7 million, which is included within impairment of non-amortizable intangible and other assets in the consolidated statements of operations. Trade Name. We have implemented the relief from royalty method to determine the estimated fair value of the Intelsat trade name. The relief from royalty analysis is comprised of two major steps: (i) a determination of the hypothetical royalty rate, and (ii) the subsequent application of the royalty rate to projected revenue. In determining the hypothetical royalty rate utilized in the relief from royalty approach, we considered comparable license agreements, an excess earnings analysis to determine aggregate intangible asset earnings, and other qualitative factors, each of which is considered a Level 3 input within the fair value hierarchy under ASC 820. The key assumptions used in our model to estimate the fair value of the Intelsat trade name included forecasted revenues, the royalty rate, the tax rate and the discount rate. We completed our analysis of the estimated fair value of the Intelsat trade name in connection with the analysis of goodwill described above in the first and fourth quarters of 2020, resulting in impairments of our trade name intangible asset of $12.2 million and $8.0 million, respectively, which is included within impairment of non-amortizable intangible and other assets in the consolidated statements of operations. The carrying amounts of acquired intangible assets not subject to amortization consisted of the following (in thousands): As of December 31, 2019 As of December 31, 2020 Orbital locations $ 2,387,700 $ 2,250,000 Trade name 65,200 45,000 Total non-amortizable intangible assets $ 2,452,900 $ 2,295,000 Other Intangible Assets . The Company evaluated acquired intangible assets subject to amortization for potential impairment using internal projections of undiscounted cash flows expected to result from the use and eventual disposal of the assets. The key assumptions included in our model were projected growth rates, cost of capital, effective tax rates, and industry and economic trends. A change in estimated future cash flows or other assumptions could change our estimated fair values and result in future impairments. The conclusion of our analysis was that the undiscounted cash flows of the asset group were greater than its carrying value, resulting in no impairment. The following table sets forth the components of identifiable intangible assets acquired as part of the Gogo Transaction and their weighted average amortization periods as of the date of acquisition, (in thousands): Estimated Fair Value Weighted Average Amortization Period (in years) Software $ 45,464 3.6 Trade name 1,000 2.0 Total $ 46,464 The carrying amount and accumulated amortization of acquired intangible assets subject to amortization consisted of the following (in thousands): As of December 31, 2019 As of December 31, 2020 Gross Accumulated Net Gross Accumulated Net Backlog and other $ 743,760 $ (713,205) $ 30,555 $ 744,760 $ (722,697) $ 22,063 Customer relationships 534,030 (287,833) 246,197 534,030 (309,486) 224,544 Software — — — 45,808 (1,846) 43,962 Total $ 1,277,790 $ (1,001,038) $ 276,752 $ 1,324,598 $ (1,034,029) $ 290,569 Intangible assets are amortized based on the expected pattern of consumption. Amortization expense was $38.5 million, $34.4 million and $33.0 million for the years ended December 31, 2018, 2019 and 2020, respectively. Scheduled amortization charges for intangible assets over the next five years are as follows (in thousands): Year Amount 2021 $ 41,193 2022 36,199 2023 28,476 2024 22,612 2025 15,945 Our policy is to expense all costs incurred to renew or extend the terms of our intangible assets. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt | DebtAs discussed in Note 2—Chapter 11 Proceedings, Ability to Continue as a Going Concern and Other Related Matters, the filing of the Chapter 11 Cases constituted an event of default that accelerated substantially all of our obligations under the documents governing the prepetition existing indebtedness of Intelsat S.A., Intelsat Luxembourg, Intelsat Connect and Intelsat Jackson. As such, we have reclassified all such debt obligations, other than debt subject to compromise, to current maturities of long-term debt on our consolidated balance sheet as of December 31, 2020. Any efforts to enforce payment obligations related to the acceleration of our debt have been automatically stayed as a result of the filing of the Chapter 11 Cases, and the creditors’ rights of enforcement are subject to the applicable provisions of the Bankruptcy Code. While the Chapter 11 Cases are pending, the Debtors do not anticipate making interest payments due under their respective unsecured debt instruments; however, the Debtors expect to make monthly interest payments on their senior secured debt instruments pursuant to the adequate protection requirements under the DIP Order. The carrying values and fair values of our notes payable and long-term debt were as follows (in thousands): As of December 31, 2019 As of December 31, 2020 Carrying Value Fair Value Carrying Value Fair Value Intelsat S.A.: 4.5% Convertible Senior Notes due June 2025 (1) $ 402,500 $ 265,231 $ 402,500 $ 130,813 Unamortized prepaid debt issuance costs and discount on 4.5% Convertible Senior Notes (133,310) — — — Total Intelsat S.A. obligations 269,190 265,231 402,500 130,813 Intelsat Luxembourg: 7.75% Senior Notes due June 2021 (1) 421,219 336,975 421,219 14,743 Unamortized prepaid debt issuance costs on 7.75% Senior Notes (1,257) — — — 8.125% Senior Notes due June 2023 (1) 1,000,000 590,000 1,000,000 130,000 Unamortized prepaid debt issuance costs on 8.125% Senior Notes (5,838) — — — 12.5% Senior Notes due November 2024 (1) 403,350 277,152 403,350 42,352 Unamortized prepaid debt issuance costs and discount on 12.5% Senior Notes (184,344) — — — Total Intelsat Luxembourg obligations 1,633,130 1,204,127 1,824,569 187,095 Intelsat Connect Finance: 9.5% Senior Notes due February 2023 (1) 1,250,000 865,625 1,250,000 334,375 Unamortized prepaid debt issuance costs and discount on 9.5% Senior Notes (27,741) — — — Total Intelsat Connect Finance obligations 1,222,259 865,625 1,250,000 334,375 Intelsat Jackson: 9.5% Senior Secured Notes due September 2022 490,000 562,275 490,000 543,900 Unamortized prepaid debt issuance costs and discount on 9.5% Senior Secured Notes (11,204) — (7,495) — 8% Senior Secured Notes due February 2024 1,349,678 1,380,046 1,349,678 1,373,297 Unamortized prepaid debt issuance costs and premium on 8% Senior Secured Notes (3,903) — (3,072) — 5.5% Senior Notes due August 2023 (1) 1,985,000 1,687,250 1,985,000 1,349,800 Unamortized prepaid debt issuance costs on 5.5% Senior Notes (8,723) — — — 9.75% Senior Notes due July 2025 (1) 1,885,000 1,729,488 1,885,000 1,347,775 Unamortized prepaid debt issuance costs on 9.75% Senior Notes (20,487) — — — 8.5% Senior Notes due October 2024 (1) 2,950,000 2,669,750 2,950,000 2,079,750 Unamortized prepaid debt issuance costs and premium on 8.5% Senior Notes (12,916) — — — Senior Secured Credit Facilities due November 2023 2,000,000 1,985,000 2,000,000 2,025,000 Unamortized prepaid debt issuance costs and discount on Senior Secured Credit Facilities (22,149) — (16,955) — Senior Secured Credit Facilities due January 2024 395,000 398,950 395,000 400,925 Unamortized prepaid debt issuance costs and discount on Senior Secured Credit Facilities (1,600) — (1,238) — 6.625% Senior Secured Credit Facilities due January 2024 700,000 712,250 700,000 714,000 Unamortized prepaid debt issuance costs and discount on Senior Secured Credit Facilities (2,832) — (2,194) — Super Priority Secured DIP Credit Facilities due July 2021 — — 1,000,000 1,011,250 Total Intelsat Jackson obligations 11,670,864 11,125,009 12,723,724 10,845,697 Eliminations: 8.125% Senior Notes of Intelsat Luxembourg due June 2023 owned by Intelsat Jackson (1) (111,663) (65,881) (111,663) (14,517) Unamortized prepaid debt issuance costs on 8.125% Senior Notes 652 — — — 12.5% Senior Notes of Intelsat Luxembourg due November 2024 owned by Intelsat Connect Finance, Intelsat Jackson and Intelsat Envision (1) (403,245) (277,080) (403,245) (42,341) Unamortized prepaid debt issuance costs and discount on 12.5% Senior Notes 184,296 — — — Total eliminations: (329,960) (342,961) (514,908) (56,858) Total Intelsat S.A. debt 14,465,483 13,117,031 15,685,885 11,441,122 Less: current maturities of long-term debt — — 5,903,724 6,068,372 Less: debt included in liabilities subject to compromise — — 9,782,161 5,372,750 Total Intelsat S.A. long-term debt $ 14,465,483 $ 13,117,031 $ — $ — (1) In connection with the Chapter 11 Cases, these balances have been reclassified as liabilities subject to compromise in our consolidated balance sheet as of December 31, 2020. As of April 15, 2020, the Company ceased making principal and interest payments, and as of May 13, 2020 ceased accruing interest expense in relation to this long-term debt that was reclassified as liabilities subject to compromise. Further, $197.0 million of debt discount, premium and issuance costs related to these notes was included within reorganization items in the consolidated statements of operations for the year ended December 31, 2020. The fair value for publicly traded instruments is determined using quoted market prices, and the fair value for non-publicly traded instruments is based upon composite pricing from a variety of sources, including market leading data providers, market makers and leading brokerage firms. Substantially all of the inputs used to determine the fair value of our debt are classified as Level 1 inputs within the fair value hierarchy from ASC 820, except our senior secured credit facilities and our 2025 Convertible Notes, the inputs for which are classified as Level 2, and Intelsat Luxembourg’s 8.125% Senior Notes due 2023 (the “2023 Luxembourg Notes”) and 12.5% Senior Notes due 2024 (the “2024 Luxembourg Notes”), the inputs for which are classified as Level 3. While the Company’s Chapter 11 proceedings remain ongoing, trading and fair value pricing may be more volatile and limited. Intelsat Jackson Superpriority Secured Debtor-in-Possession Term Loan Facility On June 17, 2020 (the “Closing Date”), the DIP Debtors and DIP Lenders entered into the DIP Credit Agreement, a non-amortizing multiple draw superpriority secured debtor-in-possession term loan facility, in an aggregate principal amount of $1.0 billion, on the terms and conditions set forth therein. See Note 2—Chapter 11 Proceedings, Ability to Continue as a Going Concern and Other Related Matters. Intelsat Jackson borrowed $500.0 million of term loans under the DIP Facility on the Closing Date. Under the DIP Facility, Intelsat Jackson may, at its sole discretion, make incremental draws of the lesser of $250.0 million and the remaining available commitments of the DIP Lenders. Intelsat Jackson made two additional draws of $250.0 million each on November 27, 2020 and December 14, 2020, bringing the total aggregate principal amount outstanding under the DIP Facility to $1.0 billion as of December 31, 2020. Drawn amounts under the DIP Facility bear interest at either (i) 4.5% per annum plus a base rate of the highest of (a) the Federal Funds Effective Rate plus ½ of 1.0%, (b) the Prime Rate as in effect on such day and (c) the London Inter-Bank Offered Rate (“LIBOR Rate”) for a one-month interest period on such day (or if such day is not a business day, the immediately preceding business day) plus 1.0% or (ii) 5.5% plus the LIBOR Rate. For purposes of the DIP Facility, the LIBOR Rate has an effective floor rate of 1.0%. Undrawn amounts under the DIP Facility shall be subject to a ticking fee of 3.6% of the amount of commitments of the DIP Lenders from the entry of the DIP Order until such commitments terminate, which ticking fee shall be payable on the last day of each fiscal quarter prior to the date such commitments terminate and on the date of such termination. If an event of default under the DIP Facility occurs, the overdue amounts under the DIP Facility would bear interest at an additional 2.0% per annum above the interest rate otherwise applicable. The proceeds of the DIP Facility may be used, among other things, to pay for (i) working capital needs of the DIP Debtors in the ordinary course of business, (ii) potential C-band relocation costs, (iii) investment and other general corporate purposes, and (iv) the costs and expenses of administering the Chapter 11 Cases. The maturity date of the DIP Facility is July 13, 2021, subject to certain extensions pursuant to the terms of the DIP Credit Agreement. The DIP Credit Agreement includes customary negative covenants for debtor-in-possession loan agreements of this type, including covenants limiting the Company’s and its subsidiaries’ ability to, among other things, incur additional indebtedness, create liens on assets, make investments, loans or advances, engage in mergers, consolidations, sales of assets and acquisitions, pay dividends and distributions and make payments in respect of junior or prepetition indebtedness, in each case subject to customary exceptions for debtor-in-possession loan agreements of this type. The DIP Credit Agreement also includes certain customary representations and warranties, affirmative covenants and events of default, including, but not limited to, payment defaults, breaches of representations and warranties, covenant defaults, certain events under the Employee Retirement Income Security Act of 1974, as amended, and change of control. Certain bankruptcy-related events are also events of default, including, but not limited to, the dismissal by the Bankruptcy Court of any of the Chapter 11 Cases, the conversion of any of the Chapter 11 Cases to a case under Chapter 7 of the Bankruptcy Code and certain other events related to the impairment of the DIP Lenders’ rights or liens granted under the DIP Credit Agreement. On August 24, 2020, the DIP Debtors and DIP Lenders entered into DIP Amendment No. 1 to the DIP Credit Agreement, and on November 25, 2020, the DIP Debtors and DIP Lenders entered into DIP Amendment No. 2 to the DIP Credit Agreement, each in connection with the Gogo Transaction (see Note 2—Chapter 11 Proceedings, Ability to Continue as a Going Concern and Other Related Matters for additional information). The foregoing descriptions of the DIP Credit Agreement, DIP Amendment No. 1, and DIP Amendment No. 2 do not purport to be complete and are qualified in their entirety by reference to the full text of the DIP Credit Agreement, DIP Amendment No. 1 and DIP Amendment No. 2, as applicable. 2019 Debt Transaction June 2019 Intelsat Jackson Senior Notes Add-On Offering In June 2019, Intelsat Jackson completed an add-on offering of $400.0 million aggregate principal amount of its 9.75% Senior Notes due 2025 (“2025 Jackson Notes”). The notes are guaranteed by all of Intelsat Jackson's subsidiaries that guarantee its obligations under the Intelsat Jackson Secured Credit Agreement and senior notes. Description of Indebtedness (a) Intelsat S.A. 4.5% Convertible Senior Notes due 2025 In June 2018, Intelsat S.A. completed an offering of 402.5 million aggregate principal amount of the 2025 Convertible Notes. The above principal amount is outstanding as of December 31, 2020. The 2025 Convertible Notes bear interest at 4.5% annually and mature in June 2025 unless earlier repurchased, converted or redeemed, as set forth in the 2025 Indenture. The 2025 Convertible Notes are guaranteed by a direct subsidiary of Intelsat Luxembourg, Intelsat Envision. Interest is payable on the 2025 Convertible Notes semi-annually on June 15 and December 15. The 2025 Convertible Notes are senior unsecured obligations of Intelsat S.A. (b) Intelsat Luxembourg 7.75% Senior Notes due 2021 Intelsat Luxembourg had $421.2 million in aggregate principal amount of its 7.75% Senior Notes due 2021 (the “2021 Luxembourg Notes”) outstanding at December 31, 2020. The 2021 Luxembourg Notes bear interest at 7.75% annually and mature in June 2021. Interest is payable on the 2021 Luxembourg Notes semi-annually on June 1 and December 1. Intelsat Luxembourg may redeem some or all of the notes at the applicable redemption prices set forth in the notes. The 2021 Luxembourg Notes are senior unsecured obligations of Intelsat Luxembourg and rank equally with Intelsat Luxembourg’s other senior unsecured indebtedness. 8.125% Senior Notes due 2023 Intelsat Luxembourg had $1.0 billion in aggregate principal amount of its 2023 Luxembourg Notes outstanding at December 31, 2020. $111.7 million principal amount was held by Intelsat Jackson. The 2023 Luxembourg Notes bear interest at 8.125% annually and mature in June 2023. Interest is payable on the 2023 Luxembourg Notes semi-annually on June 1 and December 1. Intelsat Luxembourg may redeem some or all of the notes at the applicable redemption prices set forth in the notes. The 2023 Luxembourg Notes are senior unsecured obligations of Intelsat Luxembourg and rank equally with Intelsat Luxembourg’s other senior unsecured indebtedness. 12.5% Senior Notes due 2024 Intelsat Luxembourg had $403.4 million in aggregate principal amount of its 2024 Luxembourg Notes outstanding at December 31, 2020. $182.0 million principal amount was held by ICF, $220.6 million was held by Intelsat Jackson and $0.7 million was held by Intelsat Envision. The 2024 Luxembourg Notes bear interest at 12.5% annually and mature in November 2024. Interest is payable on the 2024 Luxembourg Notes semi-annually on May 15 and November 15. The 2024 Luxembourg Notes are senior unsecured obligations of Intelsat Luxembourg and rank equally with Intelsat Luxembourg’s other senior unsecured indebtedness. (c) Intelsat Connect Finance 9.5% Senior Notes due 2023 ICF had $1.3 billion in aggregate principal amount of its 9.5% Senior Notes due 2023 (the “2023 ICF Notes”) outstanding at December 31, 2020. The 2023 ICF Notes bear interest at 9.5% annually and mature in February 2023. These notes are guaranteed by Intelsat Envision and Intelsat Luxembourg. Interest is payable on the 2023 ICF Notes semi-annually on June 15 and December 15. Beginning as of August 15, 2020, ICF may redeem some or all of the notes at the applicable redemption prices set forth in the notes. (d) Intelsat Jackson 9.5% Senior Secured Notes due 2022 Intelsat Jackson had $490.0 million in aggregate principal amount of its 9.5% Senior Secured Notes due 2022 (the “2022 Jackson Secured Notes”) outstanding at December 31, 2020. The 2022 Jackson Secured Notes bear interest at 9.5% annually and mature in September 2022. These notes are guaranteed by ICF and certain of Intelsat Jackson’s subsidiaries. Interest is payable on the 2022 Jackson Secured Notes semi-annually on March 30 and September 30 under the indenture governing the notes. However, p ursuant to the adequate protection requirements under the DIP Order, interest is payable on the 2022 Jackson Secured Notes on the 30th of each month. Intelsat Jackson may redeem some or all of the notes at the applicable redemption prices set forth in the notes. The 2022 Jackson Secured Notes are senior secured obligations of Intelsat Jackson. 8% Senior Secured Notes due 2024 Intelsat Jackson had $1.3 billion in aggregate principal amount of its 8% Senior Secured Notes due 2024 (the “2024 Jackson Secured Notes”) outstanding at December 31, 2020. The 2024 Jackson Secured Notes bear interest at 8% annually and mature in February 2024. These notes are guaranteed by ICF and certain of Intelsat Jackson’s subsidiaries. Interest is payable on the 2024 Jackson Secured Notes semi-annually on February 15 and August 15 under the indenture governing the notes. However, p ursuant to the adequate protection requirements under the DIP Order, interest is payable on the 2024 Jackson Secured Notes on the 30th of each month. Intelsat Jackson may redeem some or all of the notes at the applicable redemption prices set forth in the notes. The 2024 Jackson Secured Notes are senior secured obligations of Intelsat Jackson. 5.5% Senior Notes due 2023 Intelsat Jackson had $2.0 billion in aggregate principal amount of its 5.5% Senior Notes due 2023 (the “2023 Jackson Notes”) outstanding at December 31, 2020. The 2023 Jackson Notes bear interest at 5.5% annually and mature in August 2023. These notes are guaranteed by certain of Intelsat Jackson’s subsidiaries. Interest is payable on the 2023 Jackson Notes semi-annually on February 1 and August 1. Intelsat Jackson may redeem some or all of the 2023 Jackson Notes at the applicable redemption prices set forth in the notes. The 2023 Jackson Notes are senior unsecured obligations of Intelsat Jackson and rank equally with Intelsat Jackson’s other senior unsecured indebtedness. 9.75% Senior Notes due 2025 Intelsat Jackson had $1.9 billion in aggregate principal amount of its 2025 Jackson Notes outstanding at December 31, 2020. The 2025 Jackson Notes bear interest at 9.75% annually and mature in July 2025. These notes are guaranteed by certain of Intelsat Jackson’s subsidiaries. Interest is payable on the 2025 Jackson Notes semi-annually on January 15 and July 15. Intelsat Jackson may redeem some or all of the 2025 Jackson Notes at any time prior to July 15, 2021 at a price equal to 100% of the principal amount thereof plus the applicable premium described in the notes. Thereafter, Intelsat Jackson may redeem some or all of the notes at the applicable redemption prices set forth in the notes. The 2025 Jackson Notes are senior unsecured obligations of Intelsat Jackson and rank equally with Intelsat Jackson’s other senior unsecured indebtedness. 8.5% Senior Unsecured Notes due 2024 Intelsat Jackson had $3.0 billion in aggregate principal amount of its 8.5% Senior Unsecured Notes due 2024 (the “2024 Jackson Senior Unsecured Notes”) outstanding at December 31, 2020. The 2024 Jackson Senior Unsecured Notes bear interest at 8.5% annually and mature in October 2024. These notes are guaranteed by certain of Intelsat Jackson’s subsidiaries. Interest is payable on the 2024 Jackson Senior Unsecured Notes semi-annually on April 15 and October 15. Beginning as of October 15, 2020, Intelsat Jackson may redeem some or all of the 2024 Jackson Senior Unsecured Notes at the applicable redemption prices set forth in the notes. The 2024 Jackson Senior Unsecured Notes are senior unsecured obligations of Intelsat Jackson and rank equally with Intelsat Jackson’s other senior unsecured indebtedness. Intelsat Jackson Senior Secured Credit Agreement Under Intelsat Jackson’s senior secured credit agreement, dated as of January 12, 2011 (as amended, the “Intelsat Jackson Secured Credit Agreement”), as of December 31, 2020, Intelsat Jackson had (i) $2.0 billion in aggregate principal amount outstanding of term loans due November 27, 2023, that have an applicable interest rate margin of 3.75% per annum for LIBOR loans and 2.75% per annum for Alternate Base Rate (“ABR”) loans (at Intelsat Jackson’s election as applicable) (the “B-3 Tranche Term Loans”); (ii) $395.0 million in aggregate principal amount outstanding of incremental floating rate term loans due January 2, 2024, that have an applicable interest rate margin of 4.5% per annum for LIBOR loans and 3.5% per annum for ABR loans (at Intelsat Jackson’s election as applicable) (the “B-4 Tranche Term Loans”); and $700.0 million in aggregate principal amount outstanding of incremental fixed rate term loans due January 2, 2024, that have an interest rate of 6.625% per annum (the “B-5 Tranche Term Loans”). In April 2020, the LIBOR loans under the Intelsat Jackson Secured Credit Agreement were converted to ABR loans. The Intelsat Jackson Secured Credit Agreement is guaranteed by ICF and certain of Intelsat Jackson’s subsidiaries. However, pursuant to the adequate protection requirements under the DIP Order , interest is payable on the B-3 Tranche Term Loans, B-4 Tranche Term Loans and B-5 Tranche Term Loans on the 30th of each month, plus an incremental 2.0% default rate pursuant to the DIP Order for each tranche of term loans. |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities | 12 Months Ended |
Dec. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities Interest Rate Cap Contracts As of December 31, 2019 and 2020, we held interest rate cap contracts with an aggregate notional value of $2.4 billion that matured in February 2021. These interest rate cap contracts, which were entered into in 2017 and amended in 2018, were designed to mitigate our risk of interest rate increases on the floating rate portion of our senior secured credit facilities (see Note 12— Debt). The contracts have not been designated for hedge accounting treatment in accordance with ASC 815, Derivatives and Hedging (“ASC 815”), and the changes in fair value of these instruments, net of payments received, are recognized in the consolidated statements of operations during the period of change. We received $9.8 million in settlement payments related to the interest rate cap contracts for the year ended December 31, 2019, with no comparable amounts for the year ended December 31, 2020. Preferred Stock Warrant and Common Stock Warrant During 2017, we were issued a warrant to purchase preferred shares of one of our investments. We concluded that the warrant is a free standing derivative in accordance with ASC 815. As of December 31, 2019 and 2020, the fair value of the preferred stock warrant was zero. During 2019, we were issued a warrant to purchase common shares of a separate investment. We concluded that the warrant is a free standing derivative in accordance with ASC 815. The following table sets forth the fair value of our derivatives by category (in thousands): Derivatives not designated as hedging instruments Classification As of December 31, 2019 As of December 31, 2020 Common stock warrant Other assets $ 3,239 $ 3,239 Interest rate cap contracts Other assets 372 — Total derivatives $ 3,611 $ 3,239 The following table sets forth the effect of the derivative instruments in our consolidated statements of operations (in thousands): Derivatives not designated as hedging instruments Classification Year Ended December 31, 2018 Year Ended December 31, 2019 Year Ended December 31, 2020 Interest rate cap contracts Gain (loss) included in interest expense, net $ 14,435 $ (22,918) $ (372) Preferred stock warrant Loss included in other income (expense), net — (4,100) — Total gain (loss) on derivative financial instruments $ 14,435 $ (27,018) $ (372) |
Leases
Leases | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Leases | Leases Lessee We lease corporate and branch offices, various facilities, land and equipment, specifically third-party teleport and circuit/dark fiber. Certain leases include one or more options to renew, with renewal terms that can extend the lease term from one year to fifteen years. The exercise of lease renewal options is at our sole discretion. Considering the nature of our business and ongoing technology upgrades relating to the services we provide, we determined that the likelihood of exercising a renewal on any leased property and equipment is uncertain. Therefore, we do not generally include the renewal period in the expected lease terms. Some of our leases may include options to terminate the leases within six months of inception. Our lease agreements generally do not include options to purchase the leased property. The depreciable life of leasehold improvements is limited by the expected lease term in the absence of a transfer of title or purchase option reasonably certain of exercise. Certain of our lease agreements include rental payments with escalation provisions as defined in the contracts. These escalation provisions are included in the calculation of the present value of the lease payments for purposes of determining the value of the respective ROU asset and lease liability. Our lease agreements do not contain any material residual value guarantees or materially restrictive covenants. We rent, license or sublease certain office space and land to third parties. Our sublease portfolio consists mainly of property operating leases for office space within our McLean, Virginia U.S. administrative headquarters office building. The following table sets forth supplemental balance sheet information related to ROU assets and lease liabilities (in thousands): Classification As of December 31, 2019 As of December 31, 2020 Assets Operating Other assets $ 86,780 $ 163,834 Finance Other assets (1) 10,084 10,497 Total leased assets $ 96,864 $ 174,331 Liabilities Current Operating Other current liabilities $ 12,744 $ 19,397 Finance Other current liabilities 2,215 2,891 Long-term Operating Other long-term liabilities 99,072 166,229 Finance Other long-term liabilities 16,137 15,325 Total lease liabilities $ 130,168 $ 203,842 (1) Net of accumulated amortization of $0.5 million and $2.5 million for the years ended December 31, 2019 and 2020, respectively. The following table sets forth supplemental information related to the components of lease expense (in thousands): Classification Year Ended December 31, 2019 Year Ended December 31, 2020 Operating lease cost Direct costs of revenue $ 14,210 $ 24,770 Operating lease cost Selling, general and administrative expenses 6,159 7,420 Finance lease cost Amortization of leased assets Depreciation and amortization 542 1,953 Interest on lease liabilities Interest expense, net 813 1,708 Sublease income Other income (expense), net (1,206) (953) Net lease cost $ 20,518 $ 34,898 The following table sets forth future minimum lease payments together with the present value of lease liabilities under leases as of December 31, 2020 for the next five years and thereafter (in thousands): Operating Leases Finance Leases Total 2021 $ 26,886 $ 4,184 $ 31,070 2022 36,770 3,905 40,675 2023 36,256 3,835 40,091 2024 34,364 2,239 36,603 2025 22,376 1,918 24,294 2026 and thereafter 96,546 7,917 104,463 Total lease payments 253,198 23,998 277,196 Less: Imputed interest (1) 67,572 5,782 73,354 Present value of lease liabilities $ 185,626 $ 18,216 $ 203,842 (1) Calculated using the incremental borrowing rate assessed for each lease. As of December 31, 2020, we had an additional operating lease for an in-orbit, satellite servicing vehicle, which had not yet commenced, with payments totaling approximately $75.0 million. This lease is expected to commence in 2021 and have a lease term of 5 years. The following table sets forth supplemental cash flow information related to leases (in thousands): Year Ended December 31, 2019 Year Ended December 31, 2020 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 20,919 $ 32,993 Leased assets obtained in exchange for new operating lease liabilities 98,621 63,444 Leased assets obtained in exchange for new finance lease liabilities 10,626 3,127 ROU asset reductions due to modifications/renewals/terminations - operating leases — (8,669) The following table sets forth the weighted average remaining lease term and weighted average discount rate under leases: As of December 31, 2019 As of December 31, 2020 Weighted average remaining lease term (in years) Operating leases 8.9 7.9 Finance leases 8.0 7.3 Weighted average discount rate (1) Operating leases 7.4 % 7.7 % Finance leases 7.0 % 7.9 % (1) Discount rate is the incremental borrowing rate assessed for each lease. Lessor We have two sales-type leases related to managed service contracts. One sales-type lease commenced in 2019 and has an expiration date of March 31, 2030, with an option to extend the term provided the extension is reasonably feasible from a regulatory and technical standpoint. We evaluated the lease and determined that it contains lease and non-lease components. The sales-type lease component is accounted for separately from the other lease and non-lease components that meet the practical expedient criteria to be combined. Judgment is required in determining the allocation between the lease and non-lease components. ASC 606 is applied to the combined lease and non-lease components. There is no residual value of the leased assets and no interest income to be recognized under the lease. For the year ended December 31, 2019, the Company recorded revenue and direct costs of revenue of $14.7 million and $16.2 million, respectively, resulting in a net loss at commencement of the sales-type lease of approximately $1.5 million. The second sales-type lease commenced in 2018 and has an expiration date of December 31, 2022, with automatic renewals on an annual basis unless either party terminates the lease by providing written notice at least one year prior to the renewal date. The sales-type lease also contains non-lease components that were separated and accounted for as service arrangements. The lessee has an option to purchase the underlying equipment during or after the contract term. Upon such purchase, the lessee will have option to either terminate the underlying service or continue to receive service from the Company until the end of the service term. No residual value is assumed given the term and estimated useful life of the underlying equipment. The Company recognizes an insignificant amount of interest income annually under the lease terms. For the year ended December 31, 2018, the Company recorded revenue and direct costs of revenue of $3.1 million and $2.4 million, respectively, resulting in a net profit at commencement of the sales-type lease of approximately $0.7 million. The Company recorded a cumulative net investment in sales-type leases of approximately $13.9 million as of December 31, 2020, of which $2.0 million was included within prepaid and other current assets and $11.9 million was included within other assets in the consolidated balance sheets. The carrying value of the lease receivables approximates the net investments in the leases. As of December 31, 2020, the Company expects to receive approximately $14.1 million of lease payments over the remaining term of the service agreements, of which $2.2 million, $2.2 million, $1.3 million, $1.3 million, $1.3 million, and $5.8 million are expected to be received in 2021, 2022, 2023, 2024, 2025 and 2026 and thereafter, respectively. |
Leases | Leases Lessee We lease corporate and branch offices, various facilities, land and equipment, specifically third-party teleport and circuit/dark fiber. Certain leases include one or more options to renew, with renewal terms that can extend the lease term from one year to fifteen years. The exercise of lease renewal options is at our sole discretion. Considering the nature of our business and ongoing technology upgrades relating to the services we provide, we determined that the likelihood of exercising a renewal on any leased property and equipment is uncertain. Therefore, we do not generally include the renewal period in the expected lease terms. Some of our leases may include options to terminate the leases within six months of inception. Our lease agreements generally do not include options to purchase the leased property. The depreciable life of leasehold improvements is limited by the expected lease term in the absence of a transfer of title or purchase option reasonably certain of exercise. Certain of our lease agreements include rental payments with escalation provisions as defined in the contracts. These escalation provisions are included in the calculation of the present value of the lease payments for purposes of determining the value of the respective ROU asset and lease liability. Our lease agreements do not contain any material residual value guarantees or materially restrictive covenants. We rent, license or sublease certain office space and land to third parties. Our sublease portfolio consists mainly of property operating leases for office space within our McLean, Virginia U.S. administrative headquarters office building. The following table sets forth supplemental balance sheet information related to ROU assets and lease liabilities (in thousands): Classification As of December 31, 2019 As of December 31, 2020 Assets Operating Other assets $ 86,780 $ 163,834 Finance Other assets (1) 10,084 10,497 Total leased assets $ 96,864 $ 174,331 Liabilities Current Operating Other current liabilities $ 12,744 $ 19,397 Finance Other current liabilities 2,215 2,891 Long-term Operating Other long-term liabilities 99,072 166,229 Finance Other long-term liabilities 16,137 15,325 Total lease liabilities $ 130,168 $ 203,842 (1) Net of accumulated amortization of $0.5 million and $2.5 million for the years ended December 31, 2019 and 2020, respectively. The following table sets forth supplemental information related to the components of lease expense (in thousands): Classification Year Ended December 31, 2019 Year Ended December 31, 2020 Operating lease cost Direct costs of revenue $ 14,210 $ 24,770 Operating lease cost Selling, general and administrative expenses 6,159 7,420 Finance lease cost Amortization of leased assets Depreciation and amortization 542 1,953 Interest on lease liabilities Interest expense, net 813 1,708 Sublease income Other income (expense), net (1,206) (953) Net lease cost $ 20,518 $ 34,898 The following table sets forth future minimum lease payments together with the present value of lease liabilities under leases as of December 31, 2020 for the next five years and thereafter (in thousands): Operating Leases Finance Leases Total 2021 $ 26,886 $ 4,184 $ 31,070 2022 36,770 3,905 40,675 2023 36,256 3,835 40,091 2024 34,364 2,239 36,603 2025 22,376 1,918 24,294 2026 and thereafter 96,546 7,917 104,463 Total lease payments 253,198 23,998 277,196 Less: Imputed interest (1) 67,572 5,782 73,354 Present value of lease liabilities $ 185,626 $ 18,216 $ 203,842 (1) Calculated using the incremental borrowing rate assessed for each lease. As of December 31, 2020, we had an additional operating lease for an in-orbit, satellite servicing vehicle, which had not yet commenced, with payments totaling approximately $75.0 million. This lease is expected to commence in 2021 and have a lease term of 5 years. The following table sets forth supplemental cash flow information related to leases (in thousands): Year Ended December 31, 2019 Year Ended December 31, 2020 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 20,919 $ 32,993 Leased assets obtained in exchange for new operating lease liabilities 98,621 63,444 Leased assets obtained in exchange for new finance lease liabilities 10,626 3,127 ROU asset reductions due to modifications/renewals/terminations - operating leases — (8,669) The following table sets forth the weighted average remaining lease term and weighted average discount rate under leases: As of December 31, 2019 As of December 31, 2020 Weighted average remaining lease term (in years) Operating leases 8.9 7.9 Finance leases 8.0 7.3 Weighted average discount rate (1) Operating leases 7.4 % 7.7 % Finance leases 7.0 % 7.9 % (1) Discount rate is the incremental borrowing rate assessed for each lease. Lessor We have two sales-type leases related to managed service contracts. One sales-type lease commenced in 2019 and has an expiration date of March 31, 2030, with an option to extend the term provided the extension is reasonably feasible from a regulatory and technical standpoint. We evaluated the lease and determined that it contains lease and non-lease components. The sales-type lease component is accounted for separately from the other lease and non-lease components that meet the practical expedient criteria to be combined. Judgment is required in determining the allocation between the lease and non-lease components. ASC 606 is applied to the combined lease and non-lease components. There is no residual value of the leased assets and no interest income to be recognized under the lease. For the year ended December 31, 2019, the Company recorded revenue and direct costs of revenue of $14.7 million and $16.2 million, respectively, resulting in a net loss at commencement of the sales-type lease of approximately $1.5 million. The second sales-type lease commenced in 2018 and has an expiration date of December 31, 2022, with automatic renewals on an annual basis unless either party terminates the lease by providing written notice at least one year prior to the renewal date. The sales-type lease also contains non-lease components that were separated and accounted for as service arrangements. The lessee has an option to purchase the underlying equipment during or after the contract term. Upon such purchase, the lessee will have option to either terminate the underlying service or continue to receive service from the Company until the end of the service term. No residual value is assumed given the term and estimated useful life of the underlying equipment. The Company recognizes an insignificant amount of interest income annually under the lease terms. For the year ended December 31, 2018, the Company recorded revenue and direct costs of revenue of $3.1 million and $2.4 million, respectively, resulting in a net profit at commencement of the sales-type lease of approximately $0.7 million. The Company recorded a cumulative net investment in sales-type leases of approximately $13.9 million as of December 31, 2020, of which $2.0 million was included within prepaid and other current assets and $11.9 million was included within other assets in the consolidated balance sheets. The carrying value of the lease receivables approximates the net investments in the leases. As of December 31, 2020, the Company expects to receive approximately $14.1 million of lease payments over the remaining term of the service agreements, of which $2.2 million, $2.2 million, $1.3 million, $1.3 million, $1.3 million, and $5.8 million are expected to be received in 2021, 2022, 2023, 2024, 2025 and 2026 and thereafter, respectively. |
Leases | Leases Lessee We lease corporate and branch offices, various facilities, land and equipment, specifically third-party teleport and circuit/dark fiber. Certain leases include one or more options to renew, with renewal terms that can extend the lease term from one year to fifteen years. The exercise of lease renewal options is at our sole discretion. Considering the nature of our business and ongoing technology upgrades relating to the services we provide, we determined that the likelihood of exercising a renewal on any leased property and equipment is uncertain. Therefore, we do not generally include the renewal period in the expected lease terms. Some of our leases may include options to terminate the leases within six months of inception. Our lease agreements generally do not include options to purchase the leased property. The depreciable life of leasehold improvements is limited by the expected lease term in the absence of a transfer of title or purchase option reasonably certain of exercise. Certain of our lease agreements include rental payments with escalation provisions as defined in the contracts. These escalation provisions are included in the calculation of the present value of the lease payments for purposes of determining the value of the respective ROU asset and lease liability. Our lease agreements do not contain any material residual value guarantees or materially restrictive covenants. We rent, license or sublease certain office space and land to third parties. Our sublease portfolio consists mainly of property operating leases for office space within our McLean, Virginia U.S. administrative headquarters office building. The following table sets forth supplemental balance sheet information related to ROU assets and lease liabilities (in thousands): Classification As of December 31, 2019 As of December 31, 2020 Assets Operating Other assets $ 86,780 $ 163,834 Finance Other assets (1) 10,084 10,497 Total leased assets $ 96,864 $ 174,331 Liabilities Current Operating Other current liabilities $ 12,744 $ 19,397 Finance Other current liabilities 2,215 2,891 Long-term Operating Other long-term liabilities 99,072 166,229 Finance Other long-term liabilities 16,137 15,325 Total lease liabilities $ 130,168 $ 203,842 (1) Net of accumulated amortization of $0.5 million and $2.5 million for the years ended December 31, 2019 and 2020, respectively. The following table sets forth supplemental information related to the components of lease expense (in thousands): Classification Year Ended December 31, 2019 Year Ended December 31, 2020 Operating lease cost Direct costs of revenue $ 14,210 $ 24,770 Operating lease cost Selling, general and administrative expenses 6,159 7,420 Finance lease cost Amortization of leased assets Depreciation and amortization 542 1,953 Interest on lease liabilities Interest expense, net 813 1,708 Sublease income Other income (expense), net (1,206) (953) Net lease cost $ 20,518 $ 34,898 The following table sets forth future minimum lease payments together with the present value of lease liabilities under leases as of December 31, 2020 for the next five years and thereafter (in thousands): Operating Leases Finance Leases Total 2021 $ 26,886 $ 4,184 $ 31,070 2022 36,770 3,905 40,675 2023 36,256 3,835 40,091 2024 34,364 2,239 36,603 2025 22,376 1,918 24,294 2026 and thereafter 96,546 7,917 104,463 Total lease payments 253,198 23,998 277,196 Less: Imputed interest (1) 67,572 5,782 73,354 Present value of lease liabilities $ 185,626 $ 18,216 $ 203,842 (1) Calculated using the incremental borrowing rate assessed for each lease. As of December 31, 2020, we had an additional operating lease for an in-orbit, satellite servicing vehicle, which had not yet commenced, with payments totaling approximately $75.0 million. This lease is expected to commence in 2021 and have a lease term of 5 years. The following table sets forth supplemental cash flow information related to leases (in thousands): Year Ended December 31, 2019 Year Ended December 31, 2020 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 20,919 $ 32,993 Leased assets obtained in exchange for new operating lease liabilities 98,621 63,444 Leased assets obtained in exchange for new finance lease liabilities 10,626 3,127 ROU asset reductions due to modifications/renewals/terminations - operating leases — (8,669) The following table sets forth the weighted average remaining lease term and weighted average discount rate under leases: As of December 31, 2019 As of December 31, 2020 Weighted average remaining lease term (in years) Operating leases 8.9 7.9 Finance leases 8.0 7.3 Weighted average discount rate (1) Operating leases 7.4 % 7.7 % Finance leases 7.0 % 7.9 % (1) Discount rate is the incremental borrowing rate assessed for each lease. Lessor We have two sales-type leases related to managed service contracts. One sales-type lease commenced in 2019 and has an expiration date of March 31, 2030, with an option to extend the term provided the extension is reasonably feasible from a regulatory and technical standpoint. We evaluated the lease and determined that it contains lease and non-lease components. The sales-type lease component is accounted for separately from the other lease and non-lease components that meet the practical expedient criteria to be combined. Judgment is required in determining the allocation between the lease and non-lease components. ASC 606 is applied to the combined lease and non-lease components. There is no residual value of the leased assets and no interest income to be recognized under the lease. For the year ended December 31, 2019, the Company recorded revenue and direct costs of revenue of $14.7 million and $16.2 million, respectively, resulting in a net loss at commencement of the sales-type lease of approximately $1.5 million. The second sales-type lease commenced in 2018 and has an expiration date of December 31, 2022, with automatic renewals on an annual basis unless either party terminates the lease by providing written notice at least one year prior to the renewal date. The sales-type lease also contains non-lease components that were separated and accounted for as service arrangements. The lessee has an option to purchase the underlying equipment during or after the contract term. Upon such purchase, the lessee will have option to either terminate the underlying service or continue to receive service from the Company until the end of the service term. No residual value is assumed given the term and estimated useful life of the underlying equipment. The Company recognizes an insignificant amount of interest income annually under the lease terms. For the year ended December 31, 2018, the Company recorded revenue and direct costs of revenue of $3.1 million and $2.4 million, respectively, resulting in a net profit at commencement of the sales-type lease of approximately $0.7 million. The Company recorded a cumulative net investment in sales-type leases of approximately $13.9 million as of December 31, 2020, of which $2.0 million was included within prepaid and other current assets and $11.9 million was included within other assets in the consolidated balance sheets. The carrying value of the lease receivables approximates the net investments in the leases. As of December 31, 2020, the Company expects to receive approximately $14.1 million of lease payments over the remaining term of the service agreements, of which $2.2 million, $2.2 million, $1.3 million, $1.3 million, $1.3 million, and $5.8 million are expected to be received in 2021, 2022, 2023, 2024, 2025 and 2026 and thereafter, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes In February 2018, the FASB issued ASU 2018-02, Income Statement — Reporting Comprehensive Income (Topic 220) — Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (“ASU 2018-02”) , which allows for an optional reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the U.S. Tax Cuts and Jobs Act (the “Act”), which was signed into law on December 22, 2017. Consequently, the amendments eliminated the stranded tax effects resulting from the Act for those entities that elect the optional reclassification. ASU 2018-02 is effective for all entities for interim and annual periods beginning after December 15, 2018. We adopted ASU 2018-02 in the first quarter of 2019, which resulted in a reclassification of stranded tax effects of $16.2 million from accumulated other comprehensive loss to accumulated deficit. The Act includes a number of provisions, including the lowering of the U.S. corporate tax rate from 35 percent to 21 percent, effective January 1, 2018. The Act limits our U.S. interest expense deductions to approximately 30 percent of EBITDA through December 31, 2021 and approximately 30 percent of earnings before net interest and taxes thereafter. The Act also introduced a new minimum tax, the Base Erosion Anti-Abuse Tax (“BEAT”). We are treating the BEAT as a period cost. Effective January 1, 2019, the Luxembourg corporate tax rate decreased from 26.01% to 24.94%. This resulted in a decrease in deferred tax assets and corresponding valuation allowance. On July 2, 2018, we implemented a series of internal transactions and related steps that reorganized the ownership of certain assets among our subsidiaries (the “2018 Internal Reorganization”). The 2018 Internal Reorganization resulted in the majority of our operations being owned by a U.S.-based partnership, with certain of our wholly-owned Luxembourg and U.S. subsidiaries as partners. In response to the COVID-19 pandemic, on March 18, 2020, the Families First Coronavirus Response Act (the “FFCR Act”) was enacted, and on March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) was enacted. The FFCR Act and the CARES Act contain numerous income tax provisions, such as increasing the 30 percent adjusted taxable income threshold to 50 percent for taxable years beginning in 2019 and 2020 for purposes of determining allowable business interest expense deductions. The CARES Act repeals the 80 percent limitation for taxable years beginning before January 1, 2021 (enacted by the Act), and it further specifies that net operating losses arising in a taxable year beginning after December 31, 2017 and before January 1, 2021, are allowed as a carryback to each of the five taxable years preceding the taxable year of such losses. Modifications to the tax rules for the carryback of net operating losses and business interest limitations resulted in a federal tax refund of approximately $13.7 million for each of the years ended December 31, 2019 and 2020. In addition, the CARES Act includes refundable payroll tax credits and deferral of employment side social security payments. As of December 31, 2020, Intelsat’s payroll deferral amount was approximately $6.7 million. The following table summarizes our total income (loss) before income taxes (in thousands): Year Ended December 31, 2018 Year Ended December 31, 2019 Year Ended December 31, 2020 Domestic loss before income taxes $ (424,590) $ (869,247) $ (891,769) Foreign loss before income taxes (41,031) (49,347) (24,557) Total loss before income taxes $ (465,621) $ (918,594) $ (916,326) The primary reason for the increase in domestic loss before income tax from 2018 to 2019 was related to the satellite impairment loss our Luxembourg entities recorded in 2019. The increase in domestic loss before income tax from 2019 to 2020 was primarily related to impairments of non-amortizable intangible and other assets, as well as reorganization items related to the Chapter 11 proceedings. The provision for (benefit from) income taxes consisted of the following (in thousands): Year Ended December 31, 2018 Year Ended December 31, 2019 Year Ended December 31, 2020 Current income tax provision (benefit): Domestic $ 792 $ — $ — Foreign 50,117 20,323 (10,034) Total 50,909 20,323 (10,034) Deferred income tax provision (benefit): Domestic — — — Foreign 79,160 (27,707) 2,979 Total 79,160 (27,707) 2,979 Total income tax provision (benefit): $ 130,069 $ (7,384) $ (7,055) The income tax provision (benefit) was different from the amount computed using the Luxembourg statutory income tax rate of 26.01% for 2018 and 24.94% for each of 2019 and 2020, for the reasons set forth in the following table (in thousands): Year Ended December 31, 2018 Year Ended December 31, 2019 Year Ended December 31, 2020 Expected tax provision (benefit) at Luxembourg statutory income tax rate $ (121,108) $ (229,097) $ (228,532) Foreign income tax differential 2,216 (23,603) 4,320 Luxembourg financing activities 51,250 (5,930) 66,772 Change in tax rate (684) 163,831 — Changes in unrecognized tax benefits (2,205) (4,178) 8,595 Changes in valuation allowance 746,905 (166,683) 792,487 Tax effect of 2011 intercompany sale 1,655 1,269 — Foreign tax credits 138 — (8,754) State net operating loss modification — — 21,764 2018 internal reorganization (549,382) 257,921 36,151 Impairment to intercompany investments in Luxembourg subsidiaries — — (693,263) Net operating loss carryback — — (6,227) Other 1,284 (914) (368) Total income tax provision (benefit) $ 130,069 $ (7,384) $ (7,055) The majority of our operations are located in taxable jurisdictions, including Luxembourg, the U.S. and the United Kingdom (“UK”). Due to our cumulative losses in recent years, and the inherent uncertainty associated with the realization of taxable income in the foreseeable future, we recorded a full valuation allowance against the cumulative net operating losses generated in Luxembourg. The difference between tax expense (benefit) reported in the consolidated statements of operations and tax computed at statutory rates is attributable to the valuation allowance on losses generated in Luxembourg, the provision for foreign taxes, which were principally in the U.S. as a result of final regulations issued with respect to the CARES Act and the UK, as well as withholding taxes on revenue earned in some of the foreign markets in which we operate. The following table details the composition of the net deferred tax balances on our consolidated balance sheets as of December 31, 2019 and 2020 (in thousands): As of December 31, 2019 As of December 31, 2020 Long-term deferred taxes, net $ (55,171) $ (61,345) Other assets 21,417 21,485 Net deferred taxes $ (33,754) $ (39,860) The components of the net deferred tax liability were as follows (in thousands): As of December 31, 2019 As of December 31, 2020 Deferred tax assets: Accruals and advances $ 5,812 $ 3,042 Amortizable intangible assets 788,134 897,696 Non-amortizable intangible assets 40,527 16,569 Customer deposits 3,489 2,798 Bad debt reserve 4,468 4,460 Disallowed interest expense carryforward 109,229 76,797 Net operating loss carryforward 3,077,101 3,809,049 Tax credits 13,135 22,440 Tax basis differences in investments and affiliates 99,396 56,850 Satellites and other property and equipment — 163,335 Capital loss carryforward — 5,999 Operating lease liabilities — 11,766 Other 3,287 2,185 Total deferred tax assets 4,144,578 5,072,986 Deferred tax liabilities: Satellites and other property and equipment (51,392) — Amortizable intangible assets (7,299) (5,384) Non-amortizable intangible assets (31,407) (31,774) Tax basis differences in investments and affiliates (51,314) (148,254) Operating lease ROU asset — (11,727) Basis difference in indebtedness — (86,297) Other (354) (357) Total deferred tax liabilities (141,766) (283,793) Valuation allowance (4,036,566) (4,829,053) Total net deferred tax liabilities $ (33,754) $ (39,860) As of December 31, 2019 and 2020, our consolidated balance sheets included a deferred tax asset in the amount of $3.1 billion and $3.8 billion, respectively, attributable to the future benefit from the utilization of certain net operating loss carryforwards. In addition, our balance sheets as of December 31, 2019 and 2020 included $13.1 million and $22.4 million of deferred tax assets, respectively, attributable to the future benefit from the utilization of tax credit carryforwards. As of December 31, 2020, we had tax-effected U.S. federal, state and other foreign tax net operating loss carryforwards of $100.5 million expiring, for the most part, between 2024 and 2038. Of this amount, $8.5 million has an indefinite life. In addition, as of December 31, 2020, we had Luxembourg tax-effected net operating loss carryforwards of $3.7 billion and of this amount $1.3 billion expires, for the most part, in 2035. These Luxembourg net operating loss carryforwards were caused primarily by our interest expense, satellite depreciation and amortization and impairment charges related to investments in subsidiaries, goodwill and other intangible assets. Our research and development credit of $1.1 million may be carried forward to 2037. Our foreign tax credit of $21.3 million is fully valued. Our valuation allowance as of December 31, 2019 and 2020 was $4.0 billion and $4.8 billion, respectively. Almost all of the valuation allowance relates to Luxembourg net operating loss carryforwards and deferred tax assets created by differences between the U.S. GAAP and the Luxembourg tax basis in our assets. Certain operations of our subsidiaries are controlled by various intercompany agreements which provide these subsidiaries with predictable operating profits. Other subsidiaries, principally Luxembourg and U.S. subsidiaries, are subject to the risks of our overall business conditions which make their earnings less predictable. Our valuation allowance as of December 31, 2020 also relates to certain deferred tax assets in our U.S. subsidiaries, including foreign tax credit carryforward and disallowed interest expense carryforward. The following table summarizes the activity related to our unrecognized tax benefits (in thousands): 2019 2020 Balance at January 1 $ 29,144 $ 24,954 Increases related to current year tax positions 70 13,445 Increases related to prior year tax positions 226 15,560 Decreases related to prior year tax positions (432) (23) Expiration of statute of limitations for the assessment of taxes (4,054) (2,534) Balance at December 31 $ 24,954 $ 51,402 As of December 31, 2019 and 2020, our unrecognized tax benefits were $25.0 million and $51.4 million, respectively (including interest and penalties), of which $21.5 million and $47.6 million, respectively, if recognized, would affect our effective tax rate. As of December 31, 2019 and 2020, we had recorded reserves for interest and penalties in the amount of $0.6 million and $0.8 million, respectively. We continue to recognize interest and, to the extent applicable, penalties with respect to the unrecognized tax benefits as income tax expense. On December 2, 2019, the U.S. Department of Treasury and the U.S. Internal Revenue Service released final regulations with respect to BEAT as enacted by the 2017 Tax Reform Act. These regulations represent the final version of proposed regulations which were released in December 2018. The BEAT is a minimum tax established by the Act that subjects certain payments made by U.S. corporations or subsidiaries to foreign related parties to a secondary federal income tax regime in the U.S. The final regulations clarify which taxpayers are subject to the BEAT and how the BEAT rules apply to certain payments and transactions. We have adopted the final BEAT regulations as of the release date. These regulations are effective for the Company as of its tax year ended December 31, 2018. A second set of final regulations was issued in September 1, 2020, addressing among other topics, the application of the BEAT to partnerships and the application of the effectively connected income exception to depreciable or amortizable property contributed to a U.S. partnership by a foreign partner. Similar to the first set of final regulations issued in December 2019, these revised final regulations are effective for the tax year ended December 31, 2018. As of December 31, 2020, the Company recognized the BEAT tax impacts associated with the revised final regulations related to the tax years ended December 31, 2018, 2019 and 2020 in the amount of $1.0 million, $11.8 million, and $8.8 million, respectively. We operate in various taxable jurisdictions throughout the world and our tax returns are subject to audit and review from time to time. We consider Luxembourg, the United States, the United Kingdom and Brazil to be our significant tax jurisdictions. Our Luxembourg, U.S., UK and Brazilian subsidiaries are subject to income tax examination for periods after December 31, 2014. Within the next twelve months, we believe that there are no jurisdictions in which the outcome of unresolved tax issues or claims is likely to be material to our results of operations, financial position or cash flows. Effective January 31, 2020, the UK formally exited the European Union (“EU”). As a result of the withdrawal, existing tax reliefs and exemptions on intra-European transactions will likely cease to apply to transactions between UK entities and EU entities. In addition, transactions with non-EU countries, such as the U.S., may also be affected. As of December 31, 2020, all relevant tax laws and treaties remained unchanged and the tax consequences were unknown. Therefore, we have not recognized any impacts of the withdrawal in the income tax provision as of December 31, 2020. We will recognize any impacts to the tax provision when changes in tax laws or treaties between the UK and the EU or individual EU member states are enacted. |
Contractual Commitments
Contractual Commitments | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contractual Commitments | Contractual CommitmentsIn the further development and operation of our commercial global communications satellite system, significant additional expenditures are anticipated. In connection with these and other expenditures, we have a significant amount of long-term debt, as described in Note 12—Debt. In addition to these debt and related interest obligations, we have expenditures represented by other contractual commitments. The additional expenditures as of December 31, 2020 and the expected year of payment are as follows (in thousands): Satellite Gogo CA Satellite Commitments Satellite Performance Incentive Obligations (1) Horizons-3 Satellite LLC Contribution and Purchase (2) Customer and Sublease Rental Income Total 2021 $ 801,169 $ 104,968 $ 72,411 $ 29,849 $ 330,444 $ (523) $ 1,338,318 2022 425,693 80,104 37,047 31,692 54,075 (260) 628,351 2023 144,742 61,573 25,594 32,551 32,719 (136) 297,043 2024 15,133 59,379 24,954 33,924 27,144 (67) 160,467 2025 10,308 59,914 23,154 39,023 26,658 (17) 159,040 2026 and thereafter 49,167 199,515 80,961 154,105 73,398 (129) 557,017 Total contractual commitments $ 1,446,212 $ 565,453 $ 264,121 $ 321,144 $ 544,438 $ (1,132) $ 3,140,236 (1) Includes $4.3 million of liabilities subject to compromise. (2) Includes commitments to make capital contributions to and purchase satellite capacity from Horizons 3. See Note 10(b)—Investments—Horizons-3 Satellite LLC. (a) Satellite Construction and Launch Obligations As of December 31, 2020, we had approximately $1.4 billion of expenditures remaining under our existing satellite construction and launch contracts, including expected orbital performance incentive payments for satellites currently in the construction phase. Included in this number is the procurement and launch of seven new satellites in connection with the C-band clearing process. The Company expects to receive reimbursement payments for certain upfront C-band spectrum clearing expenses incurred, subject to the satisfaction of certain deadlines and other conditions set forth in the FCC Final Order. These contracts typically require that we make progress payments during the period of the satellites’ construction and contain provisions that allow us to cancel the contracts for or without cause. If cancelled without cause, we could be subject to substantial termination penalties, including the forfeiture of progress payments made to-date and additional penalty payments. If cancelled for cause, we are entitled to recover progress payments made to-date and liquidated damages as specified in the contracts. (b) Satellite Performance Incentive Obligations Satellite construction contracts also typically require that we make orbital incentive payments (plus interest as defined in each agreement with the satellite manufacturer) over the orbital life of the satellite. The incentive obligations may be subject to reduction or refund if the satellite fails to meet specific technical operating standards. As of December 31, 2020, we had $264.1 million of satellite performance incentive obligations, including future interest payments, for satellites currently in orbit. (c) Gogo CA Satellite Commitments We have agreements with vendors to provide us with transponder and teleport satellite services on our Gogo CA business. These agreements vary in length and amount. As of December 31, 2020, we had approximately $565.5 million of expenditures remaining under our existing commitments. (d) Customer and Vendor Contracts We have contracts with certain customers that require us to provide equipment, services and other support during the term of the related contracts. We also have long-term contractual obligations with service providers primarily for the operation of certain of our satellites. As of December 31, 2020, we had commitments under these customer and vendor contracts which totaled approximately $544.4 million related to the provision of equipment, services and other support. (e) Rental Income and Expense Rental income and sublease income are included in other income (expense), net in the accompanying consolidated statements of operations. Total rent expense for the year ended December 31, 2018 was $14.0 million under ASC 840. We adopted ASC 842 effective January 1, 2019. Please refer to Note 14—Leases for operating lease expense for 2019 and 2020 and Note 1—Background and Summary of Significant Accounting Policies for transition guidance. |
Contingencies
Contingencies | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Contingencies On May 13, 2020, Intelsat S.A. and certain of its subsidiaries filed voluntary petitions for relief under title 11 of the Bankruptcy Code in the Bankruptcy Court. As a result of such bankruptcy filings, substantially all proceedings pending against the Debtors have been stayed and prepetition liabilities are subject to compromise. See Note 2—Chapter 11 Proceedings, Ability to Continue as a Going Concern and Other Related Matters. SES Claim On July 14, 2020, SES Americom, Inc. (“SES”) filed a proof of claim in the Bankruptcy Court in the amount of $1.8 billion against each of the Debtors. SES asserts that the Debtors owe money (or will owe money) to SES pursuant to certain contractual and fiduciary obligations made in the context of the consortium agreement between Debtor Intelsat US LLC, SES, and other satellite operators (the “Consortium Agreement”). SES claims that it is entitled to 50% of the combined payments that may eventually be payable to the Debtors and SES pursuant to the FCC Final Order, which provides for Acceleration Payments subject to the satisfaction of certain deadlines and other conditions set forth therein. SES’s proof of claim alleges that the Debtors breached the Consortium Agreement by taking the position that the Debtors are not required to split Acceleration Payments with SES and the other members of the consortium. The proof of claim also alleges breach of fiduciary duties and unjust enrichment and seeks monetary and punitive damages. We dispute the allegations in the proof of claim and on October 19, 2020, filed an objection to the claim, which we intend to litigate vigorously. A trial on the SES claim is scheduled to commence on June 28, 2021 in the Bankruptcy Court. To the extent that any portion of SES’s claim is allowed, we have asked the Bankruptcy Court to ‘equitably subordinate’ such claim based on SES’s conduct in matters related to the Consortium Agreement. While the ultimate resolution of the claim is not currently predictable, if there is an adverse ruling, the ruling could constitute a material adverse outcome on our future consolidated financial condition. Other Litigation Matters In the absence of the automatic stay due to the Chapter 11 Cases, we are subject to litigation in the ordinary course of business. Management does not believe that the resolution of any pending proceedings would have a material adverse effect on our financial position or results of operations. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions (a) Shareholders’ Agreements Certain shareholders of Intelsat S.A. entered into a shareholders’ agreement in December 2018, which provides, among other things, specific rights to and limitations upon the holders of Intelsat S.A.’s share capital with respect to shares held by such holders. (b) Governance Agreement In December 2018, the Company entered into a governance agreement with its shareholder affiliated with Serafina S.A. The agreement contains provisions relating to the composition of the Company’s board of directors and certain other matters. (c) Indemnification Agreements We have entered into agreements with our executive officers and directors to provide contractual indemnification in addition to the indemnification provided for in our articles of incorporation. (d) Horizons Holdings We have a 50% ownership interest in Horizons Holdings as a result of a joint venture with JSAT (see Note 10(a)—Investments—Horizons Holdings). (e) Horizons-3 Satellite LLC We have a 50% ownership interest in Horizons 3 as a result of a joint venture with JSAT (see Note 10(b)—Investments—Horizons-3 Satellite LLC). |
Condensed Combined Debtors' Fin
Condensed Combined Debtors' Financial Information | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Condensed Combined Debtors' Financial Information | Condensed Combined Debtors' Financial Information The following presents our Debtors' condensed combined balance sheet as of December 31, 2020, and statements of operations and cash flows for the year ended December 31, 2020. Consolidating adjustments include eliminations of the following: • investments in subsidiaries; • intercompany accounts; • intercompany sales and expenses; and • intercompany equity balances. Intercompany balances with non-Debtor affiliates have not been eliminated. On the Debtors’ condensed combined balance sheet, these primarily consist of net intercompany trade receivables generated under our Master Intercompany Service Agreement (“MISA”), funding for the operations of non-Debtor affiliates and funding for the acquisition of Gogo CA. On the Debtors’ condensed combined statements of operations, total reported revenue includes intercompany revenue of $295.0 million for the year ended December 31, 2020, primarily consisting of satellite capacity charges and revenue recognized pursuant to intercompany agreements between certain Debtor entities and a newly-formed non-Debtor entity relating to the management of certain reorganization-related costs. Cost from affiliates primarily relates to sales and technical support services provided to Debtors as specified under the MISA. Investments in non-Debtor affiliates are presented under the equity method of accounting in the condensed combined financial statements set forth below. DEBTORS' CONDENSED COMBINED BALANCE SHEET (in thousands, except per share amounts) December 31, 2020 ASSETS Current assets: Cash and cash equivalents $ 879,191 Restricted cash 20,817 Receivables, net of allowance of $34,391 561,573 Contract assets 15,474 Inventory 1,347 Prepaid expenses and other current assets 100,021 Intercompany receivables 678,188 Total current assets 2,256,611 Satellites and other property and equipment, net 4,656,678 Goodwill 2,624,452 Non-amortizable intangible assets 2,295,000 Amortizable intangible assets, net 245,649 Contract assets, net of current portion 26,642 Investment in affiliates 150,029 Other assets 357,897 Total assets $ 12,612,958 LIABILITIES AND SHAREHOLDERS’ DEFICIT Current liabilities: Accounts payable and accrued liabilities $ 222,876 Taxes payable 6,743 Employee related liabilities 36,563 Accrued interest payable 17,747 Current maturities of long-term debt 5,903,724 Contract liabilities 146,762 Deferred satellite performance incentives 47,377 Other current liabilities 43,885 Total current liabilities 6,425,677 Contract liabilities, net of current portion 1,422,893 Deferred satellite performance incentives, net of current portion 138,116 Deferred income taxes 61,069 Accrued retirement benefits, net of current portion 129,837 Other long-term liabilities 188,394 Liabilities subject to compromise 10,168,518 Shareholders’ deficit: Common shares, nominal value $0.01 per share 1,421 Paid-in capital 2,573,840 Accumulated deficit (8,416,410) Accumulated other comprehensive loss (80,397) Total shareholders’ deficit (5,921,546) Total liabilities and shareholders’ deficit $ 12,612,958 DEBTORS' CONDENSED COMBINED STATEMENTS OF OPERATIONS (in thousands) Year Ended December 31, 2020 Revenue $ 1,741,077 Operating expenses: Direct costs of revenue (excluding depreciation and amortization) 267,158 Selling, general and administrative 260,192 Cost from affiliates 43,444 Depreciation and amortization 629,519 Impairment of non-amortizable intangible and other assets 191,943 Other operating expense—C-band 33,642 Total operating expenses 1,425,898 Income from operations 315,179 Interest expense, net 808,781 Equity in losses of affiliates (58,165) Other income, net 18,270 Reorganization items (385,861) Loss before income taxes (919,358) Benefit from income taxes (7,694) Net loss $ (911,664) DEBTORS' CONDENSED COMBINED STATEMENT OF CASH FLOWS (in thousands) Year Ended December 31, 2020 Cash flows from operating activities: Net loss $ (911,664) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation and amortization 629,519 Provision for expected credit losses 51,914 Foreign currency transaction gain (924) Impairment of non-amortizable intangible and other assets 191,943 Share-based compensation 10,425 Deferred income taxes 2,876 Amortization of discount, premium, issuance costs and related costs 22,136 Non-cash reorganization items 196,974 Debtor-in-possession financing fees 59,682 Amortization of actuarial loss and prior service credits for retirement benefits 2,635 Unrealized losses on derivative financial instruments 372 Unrealized gains on investments and loans held-for-investment (5,433) Equity in losses of affiliates 58,165 Other non-cash items (73) Changes in operating assets and liabilities: Receivables (14,888) Intercompany receivables (144,220) Prepaid expenses, contract and other assets (21,858) Accounts payable and accrued liabilities 129,986 Accrued interest payable 52,623 Contract liabilities (70,143) Accrued retirement benefits (15,857) Other long-term liabilities 5,848 Net cash provided by operating activities 230,038 Cash flows from investing activities: Capital expenditures (including capitalized interest) (599,283) Dividends from affiliates 30,401 Proceeds from principal repayments on loans held-for-investment 973 Capital contribution to affiliates (9,005) Acquisition of loan to affiliate (426,376) Other proceeds from satellites 5,625 Net cash used in investing activities (997,665) Cash flows from financing activities: Proceeds from debtor-in-possession financing 1,000,000 Debtor-in-possession financing fees (59,682) Principal payments on deferred satellite performance incentives (28,831) Net cash provided by financing activities 911,487 Effect of exchange rate changes on cash, cash equivalents and restricted cash 835 Net change in cash, cash equivalents and restricted cash 144,695 Cash, cash equivalents, and restricted cash, beginning of period 755,313 Cash, cash equivalents, and restricted cash, end of period $ 900,008 Reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated Debtors' balance sheet to the total sum of these same amounts shown on the condensed consolidated Debtors' statement of cash flows: Cash and cash equivalents $ 879,191 Restricted cash 20,817 Total cash, cash equivalents and restricted cash reported in the condensed consolidated Debtors' statement of cash flows $ 900,008 |
SCHEDULE II-VALUATION AND QUALI
SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Dec. 31, 2020 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS | SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS Description For the year ended December 31, 2020 Allowance for credit losses (in thousands) Accounts Receivable Contract Assets Balance at January 1, 2020 $ 40,028 $ — Cumulative-effect adjustment of ASU 2016-13 adoption (1) — 916 Business combination adjustments (2) 2,616 816 Charged to costs and expenses 54,783 2,157 Deductions (3) (56,642) — Balance at December 31, 2020 $ 40,785 $ 3,889 (1) See Note 1—Background and Summary of Significant Accounting Policies— (w) Recently Adopted Accounting Pronouncements for more information. (2) Represents an acquisition date allowance for purchased financial assets with credit deterioration with a corresponding increase to the amortized cost of the financial asset in accordance with ASC 805. (3) Uncollectible accounts written off, net of recoveries. |
Background and Summary of Sig_2
Background and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of ConsolidationThe accompanying consolidated financial statements include the accounts of Intelsat S.A., its wholly-owned subsidiaries, and variable interest entities (“VIE”) of which we are the primary beneficiary, and are prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). References to U.S. GAAP issued by the Financial Accounting Standards Board (“FASB”) in these footnotes are to the FASB Accounting Standards Codification (“ASC”). We are the primary beneficiary of one VIE, as more fully described in Note 10—Investments, and accordingly, we include in our consolidated financial statements the assets and liabilities and results of operations of the entity, even though we may not own a majority voting interest. We use the equity method to account for our investments in entities where we exercise significant influence over operating and financial policies but do not retain control under either the voting interest model (generally 20% to 50% ownership interest) or the variable interest model. In 2015, we entered into a joint venture agreement as further described in Note 10—Investments, and the investment is accounted for using the equity method. We have eliminated all significant intercompany accounts and transactions. |
Use of Estimates | Use of EstimatesThe preparation of these consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of these consolidated financial statements, the reported amounts of revenues and expenses during the reporting periods, and the disclosures of contingent liabilities. Accordingly, ultimate results could differ from those estimates. |
Revenue Recognition | Revenue RecognitionWe earn revenue primarily by providing services over satellite transponder capacity to our customers. Our customers generally obtain satellite services from us by placing an order pursuant to one of several master customer service agreements and related service orders. See Note 5—Revenue for further discussion regarding revenue recognition policies.Revenue RecognitionWe earn revenue primarily by providing services to our customers using our satellite transponder capacity. Our customers generally obtain satellite capacity from us by placing an order pursuant to one of several master customer service agreements. On-network services are comprised primarily of services delivered on our owned network infrastructure, as well as commitments for third-party capacity, generally long-term in nature, that we integrate and market as part of our owned infrastructure. In the case of third-party services in support of government applications, the commitments for third-party capacity are shorter and matched to the government contracting period, and thus remain classified as off-network services. Off-network services can include transponder services and other satellite-based transmission services, such as mobile satellite services (“MSS”), which are sourced from other operators, often in frequencies not available on our network. Under the category Off-Network and Other Revenues, we also include revenues from consulting and other services. Our Gogo CA revenue is primarily earned from providing connectivity and entertainment services and through sales of equipment. For each service type, the price per unit in our contracts is generally fixed for each defined time period. While the number of units or price per unit in our multi-year contracts may be different by year or another time period, the number of units and price per unit are fixed for each defined time period and the total contract price is fixed. To determine the proper revenue recognition method for contracts, we evaluate whether two or more services should be combined and accounted for as a single performance obligation. Certain Gogo CA contracts may be based on a fixed monthly fee per aircraft or a variable fee based on the volume of connectivity activity, or a combination of both. Examples of variable consideration within our contracts include megabyte overages and pay-per-use sessions. We constrain our estimates to reduce the probability of a significant revenue reversal in future periods, allocate such variable consideration to the identified performance obligations and recognize revenue in the period the services are provided. Our estimates are based on historical experience, anticipated future performance, market conditions and our best judgment at the time. A significant change in one or more of these estimates could affect our estimated contract value, and we regularly review and update our estimates and recognize adjustments under the cumulative catch-up model. Any adjustment under this method is recorded as a cumulative adjustment in the period identified and revenue for future periods is recognized using the new adjusted estimate. Our specific revenue recognition policies are as follows: Satellite Utilization Charges The Company’s contracts for satellite utilization services often contain multiple service orders for the provision of capacity on or over different beams, satellites, frequencies, geographies or time periods. Under each separate service order, the Company’s satellite services, comprised of transponder services, managed services, channel services, and occasional use managed services, are delivered in a series of time periods that are distinct from each other and have the same pattern of transfer to the customer. In each period, the Company’s obligation is to make those services available to the customer. Throughout each service period, the Company provides services that are able to be used continuously, and the customer simultaneously receives and consumes the benefits provided by the Company. We believe that, given that our services are stand-ready obligations that are available continuously, the passage of time most faithfully reflects our satisfaction of the performance obligation. We also have certain obligations, including providing spare or substitute capacity if available, in the event of satellite service failure under certain long-term agreements. While we are generally not obligated to refund satellite utilization payments previously made, credits may be granted for sustained service outages in certain limited circumstances. Similar to satellite utilization charges, we have determined that the customer simultaneously receives and consumes benefits provided by the Company for satellite related consulting and technical services, tracking, telemetry and commanding services (“TT&C”) and in-orbit backup services, as detailed below. Therefore, we believe that the passage of time most faithfully reflects our satisfaction of the performance obligation for these services: Satellite-Related Consulting and Technical Services . We recognize revenue from the provision of consulting services as those services are performed. We recognize revenue for consulting services with specific performance obligations, such as transfer orbit support services or training programs over the service period. TT&C . We earn TT&C services revenue from providing operational services to other satellite owners and from certain customers on our satellites. TT&C agreements entered into in connection with our satellite utilization contracts are typically for the period of the related service agreement. We recognize this revenue over the term of the service agreement. In-Orbit Backup Services . We provide back-up transponder capacity that is held on reserve for certain customers on agreed-upon terms. We recognize revenues for in-orbit protection services over the term of the related agreement. Revenue Share Arrangements. We recognize revenues under revenue share agreements for satellite-related services either on a gross or net basis in accordance with principal versus agent considerations. Airline connectivity revenue. Connectivity is provided to our customers using both our ATG and satellite technologies. Under the airline-directed business model, the airline is our customer and we earn service revenue as connectivity services are consumed directly by the airline or indirectly by passengers. Under the turnkey business model, we earn revenue for connectivity services consumed directly by passengers. Entertainment revenue. Entertainment revenue consists of entertainment services we provide to the airline for use by its passengers. Revenue is recognized as the services are provided to the airline. Connected Aircraft Services. We recognize revenue for real-time credit card transaction processing, electronic flight bags, and real-time weather information as the service is provided. Equipment Revenue. Equipment revenue primarily consists of the sale of air-to-ground and satellite connectivity equipment and the sale of entertainment equipment. Equipment revenue is recognized when we transfer control of the equipment to our customers, which generally occurs upon shipment. We occasionally sell products or services individually or in some combination to our customers. When products or services are sold together, we allocate revenue for each performance obligation based on each obligation’s relative selling price. In these arrangements, revenue for products is recognized when the transfer of control passes to the customer, while service revenue is recognized over the service term. Contract Assets Contract assets include unbilled amounts typically resulting from sales under our long-term contracts when the total contract value is recognized on a straight-line basis and the revenue recognized exceeds the amount billed to the customer. Contract assets also result from revenue contracts with multiple performance obligations when the allocated revenue recognized from satisfied performance obligations exceeds the amount billed to the customer. Contract Liabilities Contract liabilities consist of advance payments and collections in excess of revenue recognized and deferred revenue. Our contracts at times contain prepayment terms that range from one month to one year in advance of providing the service. As a practical expedient, we do not need to adjust the promised amount of consideration for the effects of a significant financing component if we expect, at contract inception, that the period of time between when the Company transfers a promised good or service to a customer and when the customer pays for that good or service will be one year or less. For a small subset of contracts with advance payments that contain prepayment terms greater than one year and up to fifteen years, we assess whether a significant financing component exists by considering the difference between the amount of promised consideration and the cash selling price of the promised services. The prepayment amount is generally based on a standard methodology that discounts the total of the standard monthly charges over the service term to determine the prepayment amount, resulting in a difference between the amount of promised consideration and the cash selling price of the promised services. The Company considers the timing difference between payment and the promised transfer of services, combined with the Company’s incremental borrowing rates, to determine whether a significant financing component exists. When a significant financing component exists, the amount of revenue recognized exceeds the amount of cash received from the customer. After receiving cash from the customer but prior to the Company providing services, the Company records additional contract liabilities as well as offsetting interest expense to reflect the upfront financing the Company is effectively receiving from the customer. Once the Company begins providing services, additional interest expense is recorded each period using the effective interest method, as well as corresponding additional revenue, which is recognized ratably over the service period. As of December 31, 2020, $405.2 million related to reimbursable costs associated with the FCC Final Order were included within contract liabilities, net of current portion on our consolidated balance sheets. For the years ended December 31, 2019 and 2020, we recognized revenue of $249.5 million and $237.4 million, respectively, that were included in the contract liability balances as of January 1, 2019 and 2020, respectively. In addition, the total amount of consideration included in contract assets as of January 1, 2019 and 2020 that became unconditional for each of the years ended December 31, 2019 and 2020 was $9.1 million and $15.1 million, respectively. Assets Recognized from the Costs to Obtain a Customer Contract We recognize an asset for the incremental costs of obtaining a contract with a customer if we expect the benefit of those costs to be longer than one year. We have determined that our sales incentive program meets the requirements to be capitalized due to the incremental nature of the costs and the expectation that the Company will recover such costs. The assets recognized from the costs to obtain a customer contract are amortized over a period that is consistent with the transfer to the customer of the services to which the asset relates. Additionally, we recognize an asset for the costs to obtain Supplemental Type Certificates (“STCs”) and Line Fit Certificates (“LFCs”), which is a regulatory requirement that must be satisfied prior to installation of equipment on the aircraft and remains an operational requirement throughout the duration of the contract. We capitalize all costs to obtain STCs and LFCs to the extent recoverable by contract revenue as costs to fulfill a customer contract. All STCs and LFCs will be amortized over the contract term (including anticipated renewals) and periodically tested for impairment. We capitalized $7.9 million and $5.9 million for costs to obtain a customer contract and amortized $5.9 million and $5.0 million for the years ended December 31, 2019 and 2020, respectively. As of December 31, 2019 and 2020, capitalized costs to obtain a customer contract amounted to $9.4 million and $10.4 million, respectively, and were included within other assets in our consolidated balance sheets. Contract Modifications Contracts are often modified to account for changes in contract specifications or requirements. We consider contract modifications to exist when the modification either creates new rights or obligations or changes the existing enforceable rights and obligations of either party. Most of our contract modifications are for goods and services that are distinct from the existing contract, as they consist of additional months of service priced at the Company’s standalone selling prices of the additional services and are therefore treated as separate contracts. For contract modifications that do not result in additional distinct goods or services, the effect of a contract modification on the transaction price and our measure of progress for the performance obligation to which it relates, is recognized as an adjustment to revenue. Significant Judgments We occasionally enter into certain contracts in which the customer makes payments in advance of services to be delivered, which may be years in the future. The reasons for the prepayments in these contracts vary, but generally can be either for the customer’s benefit or for the Company’s benefit (such as the ability to use the cash received from the customer to pay for the construction of a satellite asset). The determination of whether contracts with a prepayment provision contain a significant financing component requires judgment. The Company makes this determination based on various factors, including the differences between the amount of promised consideration and cash selling prices, the length of time between payment and the transfer of services and prevailing interest rates in the market. While most satellite utilization contracts contain multiple performance obligations for each transponder service on different satellites, the service period for the different satellite utilization performance obligations is generally the same time period. In the event that the time period for multiple performance obligations is not the same, we allocate the total transaction price to each performance obligation in an amount based on the estimated relative standalone selling price of the promised good or service underlying such performance obligation. Judgment is required to determine the standalone selling price for each distinct performance obligation. In order to estimate standalone selling prices, we use an adjusted market assessment approach which involves an evaluation of the market and an estimate of the price that our customers are willing to pay, or an expected cost plus a margin approach. When more than one party is involved in providing goods or services to a customer, we generally recognize the transaction on a gross basis due to the level of control that we have prior to the transfer of the good or service. These arrangements include instances where we procure equipment from vendors and sell to third-party customers, when we enter into revenue sharing arrangements with other parties and when we purchase capacity for voice, data and video services provided by third-party commercial satellite operators for which the desired frequency type or geographic coverage is not available on our network. Our third-party capacity arrangements (off-network) are more significant and, in determining whether we are the principal or the agent in these arrangements, we consider whether or not we control the service before it is transferred to the customer. In this determination, we consider the definition of control as set forth in ASC 606-10-25-25. When we purchase satellite transponder capacity from a third party, we have the ability to direct the use of and obtain substantially all of the remaining benefits from the purchased capacity. We obtain the right to the service to be performed by the third party, which gives the Company the ability to direct that party to provide the service to the customer on the Company’s behalf. No other third party can direct the use of or obtain any benefits from the capacity. We also considered the factors in ASC 606-10-55-39 in the Company’s determination of control. In the vast majority of cases, when we resell capacity to third party customers, we are primarily responsible for the fulfillment of the services and acceptability of the service. Additionally, the Company has full discretion in establishing the pricing for transponder services with the customer and assumes the credit risk associated with capacity purchased from the third party. In the event the service is not acceptable to the customer, we are required to identify an alternative solution. Based on these considerations, we have concluded that we are the principal in the transaction for these arrangements. When these factors are not met, the Company recognizes revenue for third-party capacity arrangements on a net basis. Judgment is required in determining whether we are the principal or the agent in transactions involving third parties. Remaining Performance Obligations Our remaining performance obligation is our expected future revenue under existing customer contracts and includes both cancelable and non-cancelable contracts. Our remaining performance obligation was approximately $6.0 billion as of December 31, 2020. We assess the contract term of our cancelable contracts as the full stated term of the contract assuming each contract is not canceled since the termination penalty upon cancellation is substantive. As of December 31, 2020, the weighted average remaining customer contract life was approximately 4.0 years. Approximately 41%, 23%, and 36% of our total remaining performance obligation as of December 31, 2020 is expected to be recognized as revenue during 2021 and 2022, 2023 and 2024, and 2025 and thereafter, respectively. The amount included in the remaining performance obligation represents the full-service charge for the duration of the contract and does not include termination fees. The amount of the termination fees, which is not included in the remaining performance obligation amount, is generally calculated as a percentage of the remaining performance obligation associated with the contract. In certain cases of breach for non-payment or customer financial distress or bankruptcy, we may not be able to recover the full value of certain contracts or termination fees. Our remaining performance obligation includes 100% of the remaining performance obligation of our consolidated ownership interests, which is consistent with the accounting for our ownership interest in these entities. (b) Business and Geographic Segment Information |
Fair Value Measurements | Fair Value Measurements We estimate the fair value of our financial instruments using available market information and valuation methodologies. The carrying amounts of cash and cash equivalents, receivables, accounts payable and accrued liabilities approximate their fair values because of the short maturity of these financial instruments. ASC 820, Fair Value Measurements and Disclosure (“ASC 820”) defines fair value as the price that would be received in the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820 requires disclosure of the extent to which fair value is used to measure financial assets and liabilities, the inputs utilized in calculating valuation measurements, and the effect of the measurement of significant unobservable inputs on earnings, or changes in net assets, as of the measurement date. ASC 820 establishes a three-level valuation hierarchy based upon the transparency of inputs utilized in the measurement and valuation of financial assets or liabilities as of the measurement date. We apply fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis. The fair value hierarchy prioritizes the inputs used in valuation techniques into three levels as follows: • Level 1—unadjusted quoted prices for identical assets or liabilities in active markets; • Level 2—quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, and inputs other than quoted market prices that are observable or that can be corroborated by observable market data by correlation; and • Level 3—unobservable inputs based upon the reporting entity’s internally developed assumptions which market participants would use in pricing the asset or liability. |
Cash and Cash Equivalents and Restricted Cash | Cash and Cash Equivalents and Restricted CashCash and cash equivalents consist of cash on hand and highly liquid investments with original maturities of three months or less, which are generally time deposits with banks and money market funds. The carrying amount of these investments approximates fair value. Restricted cash represents legally restricted amounts being held as a compensating balance for certain outstanding letters of credit. |
Receivables and Allowance for Credit Losses | Receivables and Allowance for Credit Losses We provide satellite services and extend credit to numerous customers in the satellite communication, telecommunications and video markets, as well as the airline industry. We monitor our exposure to credit losses and maintain allowances for credit losses and anticipated losses. The Company’s methodology to measure the provision for credit losses considers all relevant information to include information about historical collectability, current conditions and reasonable and supportable forecasts of future economic conditions. We believe we have adequate customer collateral and reserves to cover our exposure. As of December 31, 2020, we have incurred $405.2 million related to expected reimbursable costs associated with the FCC Final Order, which are included within the receivables line item on our consolidated balance sheets. |
Satellites and Other Property and Equipment | Satellites and Other Property and EquipmentSatellites and other property and equipment are stated at historical cost, except for satellites that have been impaired. Satellites and other property and equipment acquired as part of an acquisition are stated based on their fair value at the date of acquisition. Capitalized costs consist primarily of the costs of satellite construction and launch, including launch insurance and insurance during the period of in-orbit testing, the net present value of performance incentives expected to be payable to the satellite manufacturers (dependent on the continued satisfactory performance of the satellites), costs directly associated with the monitoring and support of satellite construction, and interest costs incurred during the period of satellite construction. |
Other Assets | Other AssetsOther assets primarily consist of investments in certain equity securities, equity method investments, loan receivables, right-of-use (“ROU”) assets, long-term deposits and other miscellaneous deferred charges and long-term assets. |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets We account for goodwill and other intangible assets in accordance with ASC 350, Intangibles—Goodwill and Other (“ASC 350”). Goodwill represents the excess of the consideration transferred plus the fair value of any noncontrolling interest in the acquiree at the acquisition date over the fair values of identifiable net assets of businesses acquired. Goodwill and certain other intangible assets deemed to have indefinite lives are not amortized but are tested on an annual basis for impairment during the fourth quarter, or whenever events or changes in circumstances indicate that the carrying amount may not be fully recoverable. See Note 11—Goodwill and Other Intangible Assets. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets We review long-lived assets, including property and equipment and acquired intangible assets with estimable useful lives, for impairment whenever events or changes in circumstances indicate that the carrying amount of such an asset may not be recoverable. These indicators of impairment can include, but are not limited to, the following: • satellite anomalies, such as a partial or full loss of power; • under-performance of an asset compared to expectations; and • shortened useful lives due to changes in the way an asset is used or expected to be used. The recoverability of an asset to be held and used is determined by comparing the carrying amount to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of the asset exceeds its estimated undiscounted future cash flows, we record an impairment charge in the amount by which the carrying amount of the asset exceeds its fair value, which we determine by either a quoted market price, if any, or a value determined by utilizing discounted cash flow techniques. |
Income Taxes | Income Taxes We account for income taxes in accordance with ASC 740, Income Taxes (“ASC 740”). We are subject to income taxes in Luxembourg, as well as the United States and a number of other foreign jurisdictions. Significant judgment is required in the calculation of our tax provision and the resulting tax liabilities and in the recoverability of our deferred tax assets that arise from temporary differences between the tax and financial statement recognition of revenue and expense and net operating loss and credit carryforwards. We regularly assess the likelihood that our deferred tax assets can be recovered. A valuation allowance is required when it is more likely than not that all or a portion of the deferred tax asset will not be realized. We evaluate the recoverability of our deferred tax assets based in part on the existence of deferred tax liabilities that can be used to realize the deferred tax assets. During the ordinary course of business, there are transactions and calculations for which the ultimate tax determination is uncertain. We evaluate our tax positions to determine if it is more likely than not that a tax position is sustainable, based solely on its technical merits and presuming the taxing authorities have full knowledge of the position and access to all relevant facts and information. When a tax position does not meet the more likely than not standard, we record a liability or contra asset for the entire amount of the unrecognized tax impact. Additionally, for those tax positions that are determined more likely than not to be sustainable, we measure the tax position at the largest amount of benefit more likely than not (determined by cumulative probability) to be realized upon settlement with the taxing authority. |
Foreign Currency Translation | Foreign Currency TranslationOur functional currency is the U.S. dollar, since substantially all customer contracts, capital expenditure contracts and operating expense obligations are denominated in U.S. dollars. Transactions not denominated in U.S. dollars have been translated using the spot rates of exchange at the dates of the transactions. We recognize differences on exchange arising on the settlement of the transactions denominated in currencies other than the U.S. dollar in the consolidated statements of operations. |
Comprehensive Loss | Comprehensive LossComprehensive loss consists of net loss and other gains and losses affecting shareholders’ deficit that, under U.S. GAAP, are excluded from net loss. Such items consist primarily of the change in the market value of pension liability adjustments. |
Share-Based Compensation | Share-Based Compensation We account for share-based compensation expense in accordance with ASC 718, Compensation — Stock Compensation , |
Deferred Satellite Performance Incentives | Deferred Satellite Performance IncentivesThe cost of satellite construction may include an element of deferred consideration that we are obligated to pay to satellite manufacturers over the lives of the satellites, provided the satellites continue to operate in accordance with contractual specifications. Historically, the satellite manufacturers have earned substantially all of these payments. Therefore, we account for these payments as deferred financing. We capitalize the present value of these payments as part of the cost of the satellites and record a corresponding liability to the satellite manufacturers. Interest expense is recognized on the deferred financing and the liability is reduced as the payments are made. |
Derivative Instruments | Derivative InstrumentsWe enter into derivative transactions primarily to manage our exposure to fluctuations in foreign exchange rates and interest rates. We employ risk management strategies, which may include the use of foreign currency swaps, interest rate swaps and interest rate caps. We measure all derivatives at fair value and recognize them as either assets or liabilities on our consolidated balance sheets. Changes in the fair value of derivative instruments not qualifying as hedges are recognized in earnings in the current period. We do not have any derivative instruments that qualify for hedge accounting. |
Bankruptcy Accounting | Bankruptcy Accounting Our consolidated financial statements included herein have been prepared as if we are a going concern and reflect the application of ASC 852, Reorganizations |
Inventory | InventoryInventories consist primarily of telecommunications systems and parts associated with our Gogo CA business and are recorded at the lower of average cost or market. We evaluate the need for write-downs associated with obsolete, slow-moving and nonsalable inventory by reviewing net realizable inventory values on a periodic basis |
Business Combinations | Business Combinations The Company accounts for business combinations under ASC 805, Business Combinations |
Warranty | WarrantyWe provide warranties on parts and labor related to our products for Gogo CA. Our warranty terms range from two |
Software Development Costs | Software Development Costs For software sold as part of our equipment sales in connection with Gogo CA , we capitalize software development costs once technological feasibility has been established. Such capitalized software costs are amortized on a product-by-product basis over the remaining estimated economic life of the product, based on the greater of the ratio that current gross revenues for a product bear to the total of current and anticipated future gross revenues for that product or the straight-line method. These costs are included in amortizable intangible assets, net in our consolidated balance sheets. |
Leases | Leases We adopted ASC 842, Leases (“ASC 842”) effective January 1, 2019 using the effective date method and applied the package of practical expedients included therein. We determine if a contract is or contains a lease at inception or modification of a contract. A contract is or contains a lease if the contract conveys the right to control the use of an identified asset for a period in exchange for consideration. Control over the use of the identified asset means the lessee has both (a) the right to obtain substantially all of the economic benefits from the use of the asset and (b) the right to direct the use of the asset. Operating and finance lease ROU assets and lease liabilities are recognized based on the present value of future minimum lease payments over the expected lease term, at the commencement date. For leases in which the implicit rate is not readily determinable, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The expected lease terms include options to extend or terminate the lease when it is reasonably certain the Company We have lease agreements with lease and non-lease components, which are generally combined, consistent with our election of the practical expedient. For lease agreements entered into or reassessed after the adoption of ASC 842 in which the Company is the lessee, the Company accounts for the lease components (e.g. fixed payments including rent, real estate taxes and insurance costs) and non-lease components (e.g. common-area maintenance costs and managed service contracts) as a single lease component for all classes of underlying assets. Leases in which the Company is the lessor are also evaluated for lease and non-lease components. In the event a sales-type lease is identified, this component is accounted for separately from lease and non-lease components that meet the practical expedient to be combined. Judgment is required in determining the allocation between lease components and also between the lease and non-lease components, as the non-lease components are the predominant components of the combined components of our sales-type leases. ASC 606, Revenue from Contracts with Customers |
Recently Adopted and Issued Accounting Pronouncements | Recently Adopted Accounting Pronouncements In June 2016, the FASB issued Accounting Standards Update (“ASU”) ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which changes how companies measure and recognize credit impairment for any financial assets. The standard requires companies to immediately recognize an estimate of credit losses expected to occur over the remaining life of the financial assets that are within the scope of the standard. We adopted ASU 2016-13 and its amendments in the first quarter of 2020, on a modified retrospective basis. The adoption of ASU 2016-13 and its amendments increased our reserve for credit losses by $0.9 million as of January 1, 2020. In January 2017, the FASB issued ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (“ASU 2017-04”), which is intended to simplify the subsequent measurement of goodwill. The amendments in ASU 2017-04 modify the concept of impairment from the condition that exists when the carrying amount of goodwill exceeds its fair value to the condition that exists when the carrying amount of a reporting unit exceeds its fair value. An entity will no longer determine goodwill impairment by calculating the implied fair value of goodwill by assigning the fair value of a reporting unit to all of its assets and liabilities, as if that reporting unit had been acquired in a business combination. We adopted ASU 2017-04 in the first quarter of 2020, on a prospective basis. As a result, we will measure impairment using the difference between the carrying amount and the fair value of the reporting unit, if required. See Note 11 — Goodwill and Other Intangible Assets for further information. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820)—Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”), as part of its disclosure framework project to improve the effectiveness of disclosures in the notes to financial statements. Changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty were applied prospectively for only the most recent interim period presented. All other amendments were applied retrospectively for all periods presented. ASU 2018-13 and its amendments were adopted by the Company in the first quarter of 2020. In August 2018, the FASB issued ASU 2018-14, Compensation—Retirement Benefits—Defined Benefit Plans—General (Subtopic 715-20)—Disclosure Framework—Changes to the Disclosure Requirements for Defined Benefit Plans (“ASU 2018-14”), as part of its disclosure framework project to improve the effectiveness of disclosures in the notes to financial statements. ASU 2018-14 modifies and clarifies disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans. The amendments remove certain disclosure requirements and require additional disclosures. ASU 2018-14 was adopted by the Company in the fourth quarter of 2020 on a retrospective basis to all periods presented. In August 2018, the FASB issued ASU 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40)—Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (“ASU 2018-15”), which requires an entity in a hosting arrangement that is a service contract to follow the guidance in Subtopic 350-40 to determine which implementation costs to capitalize as an asset related to the service contract and which costs to expense. ASU 2018-15 was adopted by the Company in the first quarter of 2020. The adoption did not have a significant impact on the Company. (x) Recently Issued Accounting Pronouncements In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting For Income Taxes (“ASU 2019-12”). The standard removes certain exceptions for recognizing deferred taxes for investments, performing intra-period allocation and calculating income taxes in interim periods. It also adds guidance to reduce complexity in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group. ASU 2019-12 will be effective for the Company for annual periods in fiscal years beginning after December 15, 2020. The impact of the adoption of ASU 2019-12 on our consolidated financial statements and associated disclosures is not expected to be material. In August 2020, the FASB issued ASU 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”). The standard simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts regarding an entity’s own equity. ASU 2020-06 is part of the FASB’s simplification initiative, which aims to reduce unnecessary complexity in U.S. GAAP. ASU 2020-06 will be effective for the Company for interim and annual periods in fiscal years beginning after December 15, 2021. We are in the process of evaluating the impact that ASU 2020-06 will have on our consolidated financial statements and associated disclosures. |
Lessor, Leases | Leases We adopted ASC 842, Leases (“ASC 842”) effective January 1, 2019 using the effective date method and applied the package of practical expedients included therein. We determine if a contract is or contains a lease at inception or modification of a contract. A contract is or contains a lease if the contract conveys the right to control the use of an identified asset for a period in exchange for consideration. Control over the use of the identified asset means the lessee has both (a) the right to obtain substantially all of the economic benefits from the use of the asset and (b) the right to direct the use of the asset. Operating and finance lease ROU assets and lease liabilities are recognized based on the present value of future minimum lease payments over the expected lease term, at the commencement date. For leases in which the implicit rate is not readily determinable, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The expected lease terms include options to extend or terminate the lease when it is reasonably certain the Company We have lease agreements with lease and non-lease components, which are generally combined, consistent with our election of the practical expedient. For lease agreements entered into or reassessed after the adoption of ASC 842 in which the Company is the lessee, the Company accounts for the lease components (e.g. fixed payments including rent, real estate taxes and insurance costs) and non-lease components (e.g. common-area maintenance costs and managed service contracts) as a single lease component for all classes of underlying assets. Leases in which the Company is the lessor are also evaluated for lease and non-lease components. In the event a sales-type lease is identified, this component is accounted for separately from lease and non-lease components that meet the practical expedient to be combined. Judgment is required in determining the allocation between lease components and also between the lease and non-lease components, as the non-lease components are the predominant components of the combined components of our sales-type leases. ASC 606, Revenue from Contracts with Customers |
Background and Summary of Sig_3
Background and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Cash and Cash Equivalents | The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within our consolidated balance sheets to the total sum of these amounts reported in our consolidated statements of cash flows (in thousands): As of December 31, 2019 As of December 31, 2020 Cash and cash equivalents $ 810,626 $ 1,060,917 Restricted cash, current 20,238 21,130 Restricted cash included in other assets — 5,500 Cash, cash equivalents and restricted cash $ 830,864 $ 1,087,547 |
Restrictions on Cash and Cash Equivalents | The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within our consolidated balance sheets to the total sum of these amounts reported in our consolidated statements of cash flows (in thousands): As of December 31, 2019 As of December 31, 2020 Cash and cash equivalents $ 810,626 $ 1,060,917 Restricted cash, current 20,238 21,130 Restricted cash included in other assets — 5,500 Cash, cash equivalents and restricted cash $ 830,864 $ 1,087,547 |
Estimated Useful Lives of Satellites and Other Property and Equipment | We depreciate satellites and other property and equipment on a straight-line basis over the following estimated useful lives: Years Buildings and improvements 10 - 40 Satellites and related costs 10 - 17 Ground segment equipment and software 4 - 15 Furniture and fixtures and computer hardware 3 - 12 Leasehold improvements (1) 2 - 13 Network equipment 5 - 25 (1) Leasehold improvements are depreciated over the shorter of the useful life of the improvement or the remaining lease term. |
Chapter 11 Proceedings, Abili_2
Chapter 11 Proceedings, Ability to Continue as a Going Concern and Other Related Matters (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Reorganizations [Abstract] | |
Schedule of Liabilities Subject to Compromise | Liabilities subject to compromise consisted of the following (in thousands): As of December 31, 2020 Accounts payable $ 9,545 Debt subject to comprise 9,782,161 Accrued interest on debt subject to compromise 341,676 Other long-term liabilities subject to compromise 35,136 Total liabilities subject to compromise $ 10,168,518 |
Schedule of Reorganization Items | Reorganization items consisted of the following (in thousands): Year Ended December 31, 2020 Adjustment of debt discount, premium and issuance costs $ 196,974 Debtor-in-possession financing fees 59,682 Professional fees 129,659 Other reorganization income (454) Total reorganization items $ 385,861 |
Acquisition of Gogo Commercia_2
Acquisition of Gogo Commercial Aviation (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Business Combinations [Abstract] | |
Allocation of Purchase Consideration | The preliminary allocation of the purchase consideration to tangible and intangible assets acquired and liabilities assumed on the acquisition date is based on estimated fair values and is as follows (in thousands): Estimated Fair Value Assets acquired Cash and cash equivalents $ 9,867 Receivables, net of allowances 52,849 Inventory 144,014 Prepaid expenses and other current assets 36,140 Property and equipment 41,328 Amortizable intangible assets Software 45,464 Trade name 1,000 Goodwill 77,620 Other assets Supplemental type certificates 24,253 Line fit certificates 21,776 Other assets 100,566 Total assets acquired 554,877 Liabilities assumed Current liabilities Accounts payable and accrued liabilities (63,300) Contract liabilities (13,527) Other current liabilities (25,472) Noncurrent liabilities (43,522) Total liabilities assumed (145,821) Total purchase consideration $ 409,056 |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Geographic Distribution of Revenue | The following table disaggregates revenue by billing region (in thousands, except percentages): Year Ended December 31, 2018 Year Ended December 31, 2019 Year Ended December 31, 2020 North America $ 1,112,774 51 % $ 1,078,100 52 % $ 1,019,248 53 % Europe 257,747 12 % 243,967 12 % 214,573 11 % Latin America and Caribbean 284,948 13 % 239,856 12 % 210,510 11 % Africa and Middle East 274,853 13 % 250,935 12 % 238,305 12 % Asia-Pacific 230,868 11 % 248,607 12 % 230,444 12 % Total $ 2,161,190 $ 2,061,465 $ 1,913,080 |
Disaggregation of Revenues | The following table disaggregates revenue by type of service (in thousands, except percentages): Year Ended December 31, 2018 Year Ended December 31, 2019 Year Ended December 31, 2020 On-Network Revenues Transponder services $ 1,570,278 73 % $ 1,468,791 71 % $ 1,372,773 72 % Managed services 393,264 18 % 374,026 18 % 298,638 15 % Channel 4,250 — % 2,400 — % 1,394 — % Total on-network revenues 1,967,792 91 % 1,845,217 89 % 1,672,805 87 % Off-Network and Other Revenues Transponder, MSS and other off-network services 150,186 7 % 175,602 9 % 182,393 10 % Satellite-related services 43,212 2 % 40,646 2 % 42,297 2 % Total off-network and other revenues 193,398 9 % 216,248 11 % 224,690 12 % In-Flight Services Revenues Services — — % — — % 14,122 1% Equipment — — % — — % 1,463 —% Total in-flight services revenue — — % — — % 15,585 1% Total $ 2,161,190 $ 2,061,465 $ 1,913,080 |
Net Loss per Share (Tables)
Net Loss per Share (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Net Loss per Share | The following table sets forth the computation of basic and diluted EPS (in thousands, except per share data or where otherwise noted): Year Ended December 31, 2018 Year Ended December 31, 2019 Year Ended December 31, 2020 Numerator: Net loss attributable to Intelsat S.A. $ (599,605) $ (913,595) $ (911,664) Denominator: Basic weighted average shares outstanding (in millions) 129.6 140.4 142.0 Diluted weighted average shares outstanding (in millions): 129.6 140.4 142.0 Basic EPS $ (4.63) $ (6.51) $ (6.42) Diluted EPS $ (4.63) $ (6.51) $ (6.42) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured and Recorded at Fair Value on Recurring Basis | The tables below present assets measured and recorded at fair value in our consolidated balance sheets on a recurring basis and their corresponding level within the fair value hierarchy (in thousands). No transfers between Level 1, Level 2 and Level 3 fair value measurements occurred for the years ended December 31, 2019 and 2020. Fair Value Measurements at December 31, 2019 As of December 31, 2019 (Level 1) (Level 2) (Level 3) Assets Marketable securities (1) $ 5,145 $ 5,145 $ — $ — Undesignated interest rate cap contracts (2) 372 — 372 — Common stock warrant (3) 3,239 — — 3,239 Total assets $ 8,756 $ 5,145 $ 372 $ 3,239 Fair Value Measurements at December 31, 2020 As of December 31, 2020 (Level 1) (Level 2) (Level 3) Assets Marketable securities (1) $ 5,205 $ 5,205 $ — $ — Common stock warrant (3) 3,239 — — 3,239 Total assets $ 8,444 $ 5,205 $ — $ 3,239 (1) The valuation measurement inputs of these marketable securities represent unadjusted quoted prices in active markets and, accordingly, we have classified such investments as Level 1 within the fair value hierarchy. The cost basis of our marketable securities was $4.3 million and $4.0 million as of December 31, 2019 and 2020, respectively. We sold marketable securities with a cost basis of $0.7 million and $0.6 million for the years ended December 31, 2019 and 2020, respectively, resulting in a gain of $0.2 million for each of the years ended December 31, 2019 and 2020, which is included within other income (expense), net in our consolidated statements of operations. (2) The valuation of our interest rate derivative instruments reflects the fair value of premiums paid, taking into account observable inputs including current interest rates, the market expectation for future interest rate volatility and current creditworthiness of the counterparties. As a result, we have determined that the valuation in its entirety is classified as Level 2 within the fair value hierarchy. (3) We valued the common stock warrant using a valuation technique that reflects the risk-free interest rate, time to maturity and volatility of comparable companies. We identified the inputs used to calculate the fair value as Level 3 inputs and concluded that the valuation in its entirety is classified as Level 3 within the fair value hierarchy. |
Reconciliation of Preferred and Common Stock Warrants Measured and Recorded at Fair Value on Recurring Basis | The following table presents a reconciliation of the preferred and common stock warrants which are measured and recorded at fair value on a recurring basis using Level 3 inputs (in thousands): Year Ended December 31, 2019 Year Ended December 31, 2020 Balance as of beginning of period $ 4,100 $ 3,239 Purchase of investments 3,239 — Unrealized loss included in other income (expense), net (4,100) — Balance as of end of period $ 3,239 $ 3,239 |
Retirement Plans and Other Re_2
Retirement Plans and Other Retiree Benefits (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Reconciliation of Funded Status and Accumulated Benefit Obligation | The following table summarizes the projected benefit obligations, plan assets and funded status of the defined benefit retirement plan, as well as the projected benefit obligations of the postretirement medical benefits provided under our medical plan (in thousands, except percentages): Year Ended December 31, 2019 Year Ended December 31, 2020 Pension Other Post- Pension Other Post- Change in benefit obligation Benefit obligation at beginning of year $ 394,082 $ 40,526 $ 423,536 $ 39,875 Interest cost 15,390 1,532 11,850 1,064 Employee contributions — 181 — 157 Plan amendments — — — — Benefits paid (24,875) (1,787) (26,350) (1,920) Actuarial net (gain) loss (1) 38,939 (577) 42,917 (2,343) Benefit obligation at end of year $ 423,536 $ 39,875 $ 451,953 $ 36,833 Change in plan assets Plan assets at beginning of year $ 297,631 $ — $ 334,821 $ — Employer contributions 4,232 1,606 3,971 1,763 Employee contributions — 181 — 157 Actual return on plan assets 57,833 — 43,633 — Benefits paid (24,875) (1,787) (26,350) (1,920) Plan assets at fair value at end of year $ 334,821 $ — $ 356,075 $ — Accrued benefit costs and funded status of the plans $ (88,715) $ (39,875) $ (95,878) $ (36,833) Accumulated benefit obligation $ 423,536 $ 451,953 Weighted average assumptions used to determine accumulated benefit obligation and accrued benefit costs Discount rate 3.29 % 3.19 % 2.41 % 2.28 % Weighted average assumptions used to determine net periodic benefit costs Discount rate 4.35 % 4.27 % 3.29 % 3.19 % Expected rate of return on plan assets 7.60 % — 7.60 % — Amounts in accumulated other comprehensive loss recognized in net periodic benefit cost Actuarial net (gain) loss, net of tax $ 4,151 $ (1,208) $ 6,295 $ (1,200) Prior service credits, net of tax — (2,502) — (2,504) Total $ 4,151 $ (3,710) $ 6,295 $ (3,704) Amounts in accumulated other comprehensive loss not yet recognized in net periodic benefit cost Actuarial net (gain) loss, net of tax $ 111,637 $ (16,646) $ 127,497 $ (17,746) Prior service credits, net of tax — (30,011) — (27,508) Total $ 111,637 $ (46,657) $ 127,497 $ (45,254) (1) For 2020, the actuarial loss impacting the pension benefit obligation was primarily due to lower discount rates at the end of 2020 compared to the end of 2019. The gain impacting the postretirement plan was mainly due to a previously assumed inflation adjustment to Health Reimbursement Accounts (“HRAs”) that is not to be provided in 2021, as well as favorable claims experience. The gain was partially offset by lower discount rates. For 2019, the actuarial loss impacting the pension benefit obligation was primarily due to lower discount rates at the end of 2019 compared to the end of 2018. The gain impacting the postretirement plan was mainly due to a lower assumption of claims and HRA stipends to be paid to beneficiaries, and favorable claims experience due to lower enrollment. The gain was partially offset by lower discount rates. |
Benefits Expected to be Paid Next Five Years | The benefits expected to be paid in each of the next five years and in the aggregate for the five years thereafter are as follows (in thousands): Pension Other Post- 2021 $ 42,185 $ 2,605 2022 28,969 2,609 2023 28,509 2,546 2024 27,146 2,492 2025 26,457 2,411 2026 to 2030 123,572 11,029 Total $ 276,838 $ 23,692 |
Target and Actual Asset Allocation | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Pension Plan Assets by Asset Category | The target and actual asset allocation of our pension plan assets were as follows: As of December 31, 2019 As of December 31, 2020 Target Actual Target Actual Equity securities 49 % 48 % 49 % 48 % Debt securities 36 % 34 % 36 % 35 % Other securities 15 % 18 % 15 % 17 % Total 100 % 100 % 100 % 100 % |
Fair Value of Pension Plan Assets | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Pension Plan Assets by Asset Category | The fair values of our pension plan assets by asset category were as follows (in thousands): Fair Value Measurements at December 31, 2019 Level 1 Level 2 Level 3 Equity Securities U.S. Large-Cap (1) $ 75,380 $ 75,380 $ — $ — U.S. Small/Mid-Cap (2) 19,566 19,566 — — World Equity Ex-U.S. (3) 65,882 65,882 — — Fixed Income Securities Long Duration Bonds (4) 95,327 95,327 — — High Yield Bonds (5) 9,610 9,610 — — Emerging Market Fixed Income (Non-U.S.) (6) 9,720 9,720 — — Other Securities $ 275,485 $ — $ — Hedge Funds (7) 18,803 Core Property Fund (8) 40,205 Income earned but not yet received 328 Total $ 334,821 Fair Value Measurements at December 31, 2020 Level 1 Level 2 Level 3 Equity Securities U.S. Large-Cap (1) $ 79,619 $ 79,619 $ — $ — U.S. Small/Mid-Cap (2) 20,569 20,569 — — World Equity Ex-U.S. (3) 69,736 69,736 — — Fixed Income Securities Long Duration Bonds (4) 103,827 103,827 — — High Yield Bonds (5) 10,352 10,352 — — Emerging Market Fixed Income (Non-U.S.) (6) 10,376 10,376 — — Other Securities $ 294,479 $ — $ — Hedge Funds (7) 20,263 Core Property Fund (8) 41,036 Cash and income earned but not yet received 297 Total $ 356,075 (1) U.S. Large-Cap Equity includes investments in funds that invest primarily in a portfolio of common stocks included in the S&P 500 Index, as well as other equity securities and derivative instruments whose value is derived from the performance of the S&P 500. (2) U.S. Small/Mid-Cap includes investments in funds that (1) invest primarily in U.S. small- and mid-cap stocks with market capitalization ranges similar to those found in the FTSE Russell 2500 Index, or (2) aim to produce investment results that correspond to the performance of the FTSE/Russell Small Cap Completeness Index. (3) World Equity Ex-U.S. includes an investment in a fund that invests primarily in common stocks and other equity securities whose issuers comprise a broad range of capitalizations and that are located outside of the U.S. The fund invests primarily in developed countries but may also invest in emerging markets. (4) Long Duration Bonds includes an investment in a fund that invests primarily in long-duration government and corporate fixed income securities and uses derivative instruments (including interest rate swaps and U.S. Treasury futures contracts) for the purpose of managing the overall duration and yield curve exposure of the fund's portfolio. (5) High Yield Bonds includes an investment in a fund that seeks to maximize return by investing primarily in a diversified portfolio of higher yielding, lower rated fixed income securities. The fund will invest primarily in securities rated below investment grade, including corporate bonds, convertible and preferred securities and zero coupon obligations. (6) Emerging Markets Fixed Income (Non-U.S.) includes an investment in a fund that seeks to maximize return by investing in fixed income securities of emerging markets issuers. The fund will invest primarily in U.S. dollar denominated debt securities of government, government-related and corporate issuers in emerging market countries, as well as entities organized to restructure the outstanding debt of such issuers. (7) Hedge Funds includes an investment in a collective trust fund that seeks to provide returns that are different from (less correlated with) investments in more traditional asset classes. The fund will pursue its investment objective by investing substantially all of its assets in various hedge funds. The fund has semi-annual redemptions in June and December with a pre-notification period of 95 days, and a two year lock-up on all purchases which have expired. (8) The Core Property Fund is a collective trust fund that invests in direct commercial property funds primarily in the U.S. The fund is meant to provide current income-oriented returns, diversification, and modest inflation protection to an overall investment portfolio. Total returns are expected to be somewhere between stocks and bonds, with moderate volatility and low correlation to public markets. The fund has quarterly redemptions with a pre-notification period of 95 days, and no lock-up period. |
Pension Benefits | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Components of Net Periodic Benefit Costs (Income) | Net periodic pension income included the following components (in thousands): Year Ended December 31, 2018 Year Ended December 31, 2019 Year Ended December 31, 2020 Interest cost $ 14,428 $ 15,390 $ 11,850 Expected return on plan assets (24,482) (23,490) (23,242) Amortization of unrecognized net loss 5,307 4,221 6,399 Total income $ (4,747) $ (3,879) $ (4,993) |
Other Post- retirement Benefits | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Components of Net Periodic Benefit Costs (Income) | Net periodic other postretirement benefit costs (income) included the following components (in thousands): Year Ended December 31, 2018 Year Ended December 31, 2019 Year Ended December 31, 2020 Interest cost $ 2,314 $ 1,532 $ 1,064 Amortization of prior service credit (854) (2,544) (2,545) Amortization of unrecognized net gain (630) (1,229) (1,220) Total costs (income) $ 830 $ (2,241) $ (2,701) |
Satellites and Other Property_2
Satellites and Other Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Satellites and Other Property and Equipment, Net | Satellites and other property and equipment, net were comprised of the following (in thousands): As of December 31, 2019 As of December 31, 2020 Satellites and launch vehicles $ 10,407,690 $ 10,500,021 Information systems and ground segment 968,482 1,062,216 Buildings and other 280,109 322,093 Total cost 11,656,281 11,884,330 Less: accumulated depreciation (6,954,218) (7,126,453) Total $ 4,702,063 $ 4,757,877 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Carrying Amounts of Goodwill | The carrying amounts of goodwill consisted of the following (in thousands): As of December 31, 2019 As of December 31, 2020 Goodwill $ 6,780,827 $ 6,858,447 Accumulated impairment losses (4,160,200) (4,160,200) Net carrying amount $ 2,620,627 $ 2,698,247 |
Carrying Amounts of Acquired Intangible Assets Not Subject to Amortization | The carrying amounts of acquired intangible assets not subject to amortization consisted of the following (in thousands): As of December 31, 2019 As of December 31, 2020 Orbital locations $ 2,387,700 $ 2,250,000 Trade name 65,200 45,000 Total non-amortizable intangible assets $ 2,452,900 $ 2,295,000 |
Schedule of Acquired Intangible Assets | The following table sets forth the components of identifiable intangible assets acquired as part of the Gogo Transaction and their weighted average amortization periods as of the date of acquisition, (in thousands): Estimated Fair Value Weighted Average Amortization Period (in years) Software $ 45,464 3.6 Trade name 1,000 2.0 Total $ 46,464 |
Carrying Amount and Accumulated Amortization of Acquired Intangible Assets Subject to Amortization | The carrying amount and accumulated amortization of acquired intangible assets subject to amortization consisted of the following (in thousands): As of December 31, 2019 As of December 31, 2020 Gross Accumulated Net Gross Accumulated Net Backlog and other $ 743,760 $ (713,205) $ 30,555 $ 744,760 $ (722,697) $ 22,063 Customer relationships 534,030 (287,833) 246,197 534,030 (309,486) 224,544 Software — — — 45,808 (1,846) 43,962 Total $ 1,277,790 $ (1,001,038) $ 276,752 $ 1,324,598 $ (1,034,029) $ 290,569 |
Scheduled Amortization Charges for Intangible Assets | Scheduled amortization charges for intangible assets over the next five years are as follows (in thousands): Year Amount 2021 $ 41,193 2022 36,199 2023 28,476 2024 22,612 2025 15,945 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Carrying Values and Fair Values of Notes Payable and Long-Term Debt | The carrying values and fair values of our notes payable and long-term debt were as follows (in thousands): As of December 31, 2019 As of December 31, 2020 Carrying Value Fair Value Carrying Value Fair Value Intelsat S.A.: 4.5% Convertible Senior Notes due June 2025 (1) $ 402,500 $ 265,231 $ 402,500 $ 130,813 Unamortized prepaid debt issuance costs and discount on 4.5% Convertible Senior Notes (133,310) — — — Total Intelsat S.A. obligations 269,190 265,231 402,500 130,813 Intelsat Luxembourg: 7.75% Senior Notes due June 2021 (1) 421,219 336,975 421,219 14,743 Unamortized prepaid debt issuance costs on 7.75% Senior Notes (1,257) — — — 8.125% Senior Notes due June 2023 (1) 1,000,000 590,000 1,000,000 130,000 Unamortized prepaid debt issuance costs on 8.125% Senior Notes (5,838) — — — 12.5% Senior Notes due November 2024 (1) 403,350 277,152 403,350 42,352 Unamortized prepaid debt issuance costs and discount on 12.5% Senior Notes (184,344) — — — Total Intelsat Luxembourg obligations 1,633,130 1,204,127 1,824,569 187,095 Intelsat Connect Finance: 9.5% Senior Notes due February 2023 (1) 1,250,000 865,625 1,250,000 334,375 Unamortized prepaid debt issuance costs and discount on 9.5% Senior Notes (27,741) — — — Total Intelsat Connect Finance obligations 1,222,259 865,625 1,250,000 334,375 Intelsat Jackson: 9.5% Senior Secured Notes due September 2022 490,000 562,275 490,000 543,900 Unamortized prepaid debt issuance costs and discount on 9.5% Senior Secured Notes (11,204) — (7,495) — 8% Senior Secured Notes due February 2024 1,349,678 1,380,046 1,349,678 1,373,297 Unamortized prepaid debt issuance costs and premium on 8% Senior Secured Notes (3,903) — (3,072) — 5.5% Senior Notes due August 2023 (1) 1,985,000 1,687,250 1,985,000 1,349,800 Unamortized prepaid debt issuance costs on 5.5% Senior Notes (8,723) — — — 9.75% Senior Notes due July 2025 (1) 1,885,000 1,729,488 1,885,000 1,347,775 Unamortized prepaid debt issuance costs on 9.75% Senior Notes (20,487) — — — 8.5% Senior Notes due October 2024 (1) 2,950,000 2,669,750 2,950,000 2,079,750 Unamortized prepaid debt issuance costs and premium on 8.5% Senior Notes (12,916) — — — Senior Secured Credit Facilities due November 2023 2,000,000 1,985,000 2,000,000 2,025,000 Unamortized prepaid debt issuance costs and discount on Senior Secured Credit Facilities (22,149) — (16,955) — Senior Secured Credit Facilities due January 2024 395,000 398,950 395,000 400,925 Unamortized prepaid debt issuance costs and discount on Senior Secured Credit Facilities (1,600) — (1,238) — 6.625% Senior Secured Credit Facilities due January 2024 700,000 712,250 700,000 714,000 Unamortized prepaid debt issuance costs and discount on Senior Secured Credit Facilities (2,832) — (2,194) — Super Priority Secured DIP Credit Facilities due July 2021 — — 1,000,000 1,011,250 Total Intelsat Jackson obligations 11,670,864 11,125,009 12,723,724 10,845,697 Eliminations: 8.125% Senior Notes of Intelsat Luxembourg due June 2023 owned by Intelsat Jackson (1) (111,663) (65,881) (111,663) (14,517) Unamortized prepaid debt issuance costs on 8.125% Senior Notes 652 — — — 12.5% Senior Notes of Intelsat Luxembourg due November 2024 owned by Intelsat Connect Finance, Intelsat Jackson and Intelsat Envision (1) (403,245) (277,080) (403,245) (42,341) Unamortized prepaid debt issuance costs and discount on 12.5% Senior Notes 184,296 — — — Total eliminations: (329,960) (342,961) (514,908) (56,858) Total Intelsat S.A. debt 14,465,483 13,117,031 15,685,885 11,441,122 Less: current maturities of long-term debt — — 5,903,724 6,068,372 Less: debt included in liabilities subject to compromise — — 9,782,161 5,372,750 Total Intelsat S.A. long-term debt $ 14,465,483 $ 13,117,031 $ — $ — (1) In connection with the Chapter 11 Cases, these balances have been reclassified as liabilities subject to compromise in our consolidated balance sheet as of December 31, 2020. As of April 15, 2020, the Company ceased making principal and interest payments, and as of May 13, 2020 ceased accruing interest expense in relation to this long-term debt that was reclassified as liabilities subject to compromise. Further, $197.0 million of debt discount, premium and issuance costs related to these notes was included within reorganization items in the consolidated statements of operations for the year ended December 31, 2020. |
Derivative Instruments and He_2
Derivative Instruments and Hedging Activities (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Fair Value of Derivatives by Category | The following table sets forth the fair value of our derivatives by category (in thousands): Derivatives not designated as hedging instruments Classification As of December 31, 2019 As of December 31, 2020 Common stock warrant Other assets $ 3,239 $ 3,239 Interest rate cap contracts Other assets 372 — Total derivatives $ 3,611 $ 3,239 |
Effect of Derivative Instruments on Condensed Consolidated Statements of Operations | The following table sets forth the effect of the derivative instruments in our consolidated statements of operations (in thousands): Derivatives not designated as hedging instruments Classification Year Ended December 31, 2018 Year Ended December 31, 2019 Year Ended December 31, 2020 Interest rate cap contracts Gain (loss) included in interest expense, net $ 14,435 $ (22,918) $ (372) Preferred stock warrant Loss included in other income (expense), net — (4,100) — Total gain (loss) on derivative financial instruments $ 14,435 $ (27,018) $ (372) |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Supplemental Balance Sheet Information Related to Leases | The following table sets forth supplemental balance sheet information related to ROU assets and lease liabilities (in thousands): Classification As of December 31, 2019 As of December 31, 2020 Assets Operating Other assets $ 86,780 $ 163,834 Finance Other assets (1) 10,084 10,497 Total leased assets $ 96,864 $ 174,331 Liabilities Current Operating Other current liabilities $ 12,744 $ 19,397 Finance Other current liabilities 2,215 2,891 Long-term Operating Other long-term liabilities 99,072 166,229 Finance Other long-term liabilities 16,137 15,325 Total lease liabilities $ 130,168 $ 203,842 (1) Net of accumulated amortization of $0.5 million and $2.5 million for the years ended December 31, 2019 and 2020, respectively. The following table sets forth the weighted average remaining lease term and weighted average discount rate under leases: As of December 31, 2019 As of December 31, 2020 Weighted average remaining lease term (in years) Operating leases 8.9 7.9 Finance leases 8.0 7.3 Weighted average discount rate (1) Operating leases 7.4 % 7.7 % Finance leases 7.0 % 7.9 % (1) Discount rate is the incremental borrowing rate assessed for each lease. |
Supplemental Information Related to the Components of Leases and Lease Expense | The following table sets forth supplemental information related to the components of lease expense (in thousands): Classification Year Ended December 31, 2019 Year Ended December 31, 2020 Operating lease cost Direct costs of revenue $ 14,210 $ 24,770 Operating lease cost Selling, general and administrative expenses 6,159 7,420 Finance lease cost Amortization of leased assets Depreciation and amortization 542 1,953 Interest on lease liabilities Interest expense, net 813 1,708 Sublease income Other income (expense), net (1,206) (953) Net lease cost $ 20,518 $ 34,898 The following table sets forth supplemental cash flow information related to leases (in thousands): Year Ended December 31, 2019 Year Ended December 31, 2020 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 20,919 $ 32,993 Leased assets obtained in exchange for new operating lease liabilities 98,621 63,444 Leased assets obtained in exchange for new finance lease liabilities 10,626 3,127 ROU asset reductions due to modifications/renewals/terminations - operating leases — (8,669) |
Operating Lease Maturity | The following table sets forth future minimum lease payments together with the present value of lease liabilities under leases as of December 31, 2020 for the next five years and thereafter (in thousands): Operating Leases Finance Leases Total 2021 $ 26,886 $ 4,184 $ 31,070 2022 36,770 3,905 40,675 2023 36,256 3,835 40,091 2024 34,364 2,239 36,603 2025 22,376 1,918 24,294 2026 and thereafter 96,546 7,917 104,463 Total lease payments 253,198 23,998 277,196 Less: Imputed interest (1) 67,572 5,782 73,354 Present value of lease liabilities $ 185,626 $ 18,216 $ 203,842 (1) Calculated using the incremental borrowing rate assessed for each lease. |
Finance Lease Maturity | The following table sets forth future minimum lease payments together with the present value of lease liabilities under leases as of December 31, 2020 for the next five years and thereafter (in thousands): Operating Leases Finance Leases Total 2021 $ 26,886 $ 4,184 $ 31,070 2022 36,770 3,905 40,675 2023 36,256 3,835 40,091 2024 34,364 2,239 36,603 2025 22,376 1,918 24,294 2026 and thereafter 96,546 7,917 104,463 Total lease payments 253,198 23,998 277,196 Less: Imputed interest (1) 67,572 5,782 73,354 Present value of lease liabilities $ 185,626 $ 18,216 $ 203,842 (1) Calculated using the incremental borrowing rate assessed for each lease. |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Summary of Total Income (Loss) Before Income Taxes | The following table summarizes our total income (loss) before income taxes (in thousands): Year Ended December 31, 2018 Year Ended December 31, 2019 Year Ended December 31, 2020 Domestic loss before income taxes $ (424,590) $ (869,247) $ (891,769) Foreign loss before income taxes (41,031) (49,347) (24,557) Total loss before income taxes $ (465,621) $ (918,594) $ (916,326) |
Provision for (Benefit from) Income Taxes | The provision for (benefit from) income taxes consisted of the following (in thousands): Year Ended December 31, 2018 Year Ended December 31, 2019 Year Ended December 31, 2020 Current income tax provision (benefit): Domestic $ 792 $ — $ — Foreign 50,117 20,323 (10,034) Total 50,909 20,323 (10,034) Deferred income tax provision (benefit): Domestic — — — Foreign 79,160 (27,707) 2,979 Total 79,160 (27,707) 2,979 Total income tax provision (benefit): $ 130,069 $ (7,384) $ (7,055) |
Income Tax Provision (Benefit) | The income tax provision (benefit) was different from the amount computed using the Luxembourg statutory income tax rate of 26.01% for 2018 and 24.94% for each of 2019 and 2020, for the reasons set forth in the following table (in thousands): Year Ended December 31, 2018 Year Ended December 31, 2019 Year Ended December 31, 2020 Expected tax provision (benefit) at Luxembourg statutory income tax rate $ (121,108) $ (229,097) $ (228,532) Foreign income tax differential 2,216 (23,603) 4,320 Luxembourg financing activities 51,250 (5,930) 66,772 Change in tax rate (684) 163,831 — Changes in unrecognized tax benefits (2,205) (4,178) 8,595 Changes in valuation allowance 746,905 (166,683) 792,487 Tax effect of 2011 intercompany sale 1,655 1,269 — Foreign tax credits 138 — (8,754) State net operating loss modification — — 21,764 2018 internal reorganization (549,382) 257,921 36,151 Impairment to intercompany investments in Luxembourg subsidiaries — — (693,263) Net operating loss carryback — — (6,227) Other 1,284 (914) (368) Total income tax provision (benefit) $ 130,069 $ (7,384) $ (7,055) |
Net Deferred Tax Balances | The following table details the composition of the net deferred tax balances on our consolidated balance sheets as of December 31, 2019 and 2020 (in thousands): As of December 31, 2019 As of December 31, 2020 Long-term deferred taxes, net $ (55,171) $ (61,345) Other assets 21,417 21,485 Net deferred taxes $ (33,754) $ (39,860) |
Components of Net Deferred Tax Liability | The components of the net deferred tax liability were as follows (in thousands): As of December 31, 2019 As of December 31, 2020 Deferred tax assets: Accruals and advances $ 5,812 $ 3,042 Amortizable intangible assets 788,134 897,696 Non-amortizable intangible assets 40,527 16,569 Customer deposits 3,489 2,798 Bad debt reserve 4,468 4,460 Disallowed interest expense carryforward 109,229 76,797 Net operating loss carryforward 3,077,101 3,809,049 Tax credits 13,135 22,440 Tax basis differences in investments and affiliates 99,396 56,850 Satellites and other property and equipment — 163,335 Capital loss carryforward — 5,999 Operating lease liabilities — 11,766 Other 3,287 2,185 Total deferred tax assets 4,144,578 5,072,986 Deferred tax liabilities: Satellites and other property and equipment (51,392) — Amortizable intangible assets (7,299) (5,384) Non-amortizable intangible assets (31,407) (31,774) Tax basis differences in investments and affiliates (51,314) (148,254) Operating lease ROU asset — (11,727) Basis difference in indebtedness — (86,297) Other (354) (357) Total deferred tax liabilities (141,766) (283,793) Valuation allowance (4,036,566) (4,829,053) Total net deferred tax liabilities $ (33,754) $ (39,860) |
Summary of Activity Related to Unrecognized Tax Benefits | The following table summarizes the activity related to our unrecognized tax benefits (in thousands): 2019 2020 Balance at January 1 $ 29,144 $ 24,954 Increases related to current year tax positions 70 13,445 Increases related to prior year tax positions 226 15,560 Decreases related to prior year tax positions (432) (23) Expiration of statute of limitations for the assessment of taxes (4,054) (2,534) Balance at December 31 $ 24,954 $ 51,402 |
Contractual Commitments (Tables
Contractual Commitments (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Additional Expenditures and Expected Year of Payment | The additional expenditures as of December 31, 2020 and the expected year of payment are as follows (in thousands): Satellite Gogo CA Satellite Commitments Satellite Performance Incentive Obligations (1) Horizons-3 Satellite LLC Contribution and Purchase (2) Customer and Sublease Rental Income Total 2021 $ 801,169 $ 104,968 $ 72,411 $ 29,849 $ 330,444 $ (523) $ 1,338,318 2022 425,693 80,104 37,047 31,692 54,075 (260) 628,351 2023 144,742 61,573 25,594 32,551 32,719 (136) 297,043 2024 15,133 59,379 24,954 33,924 27,144 (67) 160,467 2025 10,308 59,914 23,154 39,023 26,658 (17) 159,040 2026 and thereafter 49,167 199,515 80,961 154,105 73,398 (129) 557,017 Total contractual commitments $ 1,446,212 $ 565,453 $ 264,121 $ 321,144 $ 544,438 $ (1,132) $ 3,140,236 (1) Includes $4.3 million of liabilities subject to compromise. (2) Includes commitments to make capital contributions to and purchase satellite capacity from Horizons 3. See Note 10(b)—Investments—Horizons-3 Satellite LLC. |
Condensed Combined Debtors' F_2
Condensed Combined Debtors' Financial Information (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Condensed Combined Balance Sheet | DEBTORS' CONDENSED COMBINED BALANCE SHEET (in thousands, except per share amounts) December 31, 2020 ASSETS Current assets: Cash and cash equivalents $ 879,191 Restricted cash 20,817 Receivables, net of allowance of $34,391 561,573 Contract assets 15,474 Inventory 1,347 Prepaid expenses and other current assets 100,021 Intercompany receivables 678,188 Total current assets 2,256,611 Satellites and other property and equipment, net 4,656,678 Goodwill 2,624,452 Non-amortizable intangible assets 2,295,000 Amortizable intangible assets, net 245,649 Contract assets, net of current portion 26,642 Investment in affiliates 150,029 Other assets 357,897 Total assets $ 12,612,958 LIABILITIES AND SHAREHOLDERS’ DEFICIT Current liabilities: Accounts payable and accrued liabilities $ 222,876 Taxes payable 6,743 Employee related liabilities 36,563 Accrued interest payable 17,747 Current maturities of long-term debt 5,903,724 Contract liabilities 146,762 Deferred satellite performance incentives 47,377 Other current liabilities 43,885 Total current liabilities 6,425,677 Contract liabilities, net of current portion 1,422,893 Deferred satellite performance incentives, net of current portion 138,116 Deferred income taxes 61,069 Accrued retirement benefits, net of current portion 129,837 Other long-term liabilities 188,394 Liabilities subject to compromise 10,168,518 Shareholders’ deficit: Common shares, nominal value $0.01 per share 1,421 Paid-in capital 2,573,840 Accumulated deficit (8,416,410) Accumulated other comprehensive loss (80,397) Total shareholders’ deficit (5,921,546) Total liabilities and shareholders’ deficit $ 12,612,958 |
Schedule of Condensed Combined Statements of Operations | DEBTORS' CONDENSED COMBINED STATEMENTS OF OPERATIONS (in thousands) Year Ended December 31, 2020 Revenue $ 1,741,077 Operating expenses: Direct costs of revenue (excluding depreciation and amortization) 267,158 Selling, general and administrative 260,192 Cost from affiliates 43,444 Depreciation and amortization 629,519 Impairment of non-amortizable intangible and other assets 191,943 Other operating expense—C-band 33,642 Total operating expenses 1,425,898 Income from operations 315,179 Interest expense, net 808,781 Equity in losses of affiliates (58,165) Other income, net 18,270 Reorganization items (385,861) Loss before income taxes (919,358) Benefit from income taxes (7,694) Net loss $ (911,664) |
Schedule of Condensed Combined Statement of Cash Flows | DEBTORS' CONDENSED COMBINED STATEMENT OF CASH FLOWS (in thousands) Year Ended December 31, 2020 Cash flows from operating activities: Net loss $ (911,664) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation and amortization 629,519 Provision for expected credit losses 51,914 Foreign currency transaction gain (924) Impairment of non-amortizable intangible and other assets 191,943 Share-based compensation 10,425 Deferred income taxes 2,876 Amortization of discount, premium, issuance costs and related costs 22,136 Non-cash reorganization items 196,974 Debtor-in-possession financing fees 59,682 Amortization of actuarial loss and prior service credits for retirement benefits 2,635 Unrealized losses on derivative financial instruments 372 Unrealized gains on investments and loans held-for-investment (5,433) Equity in losses of affiliates 58,165 Other non-cash items (73) Changes in operating assets and liabilities: Receivables (14,888) Intercompany receivables (144,220) Prepaid expenses, contract and other assets (21,858) Accounts payable and accrued liabilities 129,986 Accrued interest payable 52,623 Contract liabilities (70,143) Accrued retirement benefits (15,857) Other long-term liabilities 5,848 Net cash provided by operating activities 230,038 Cash flows from investing activities: Capital expenditures (including capitalized interest) (599,283) Dividends from affiliates 30,401 Proceeds from principal repayments on loans held-for-investment 973 Capital contribution to affiliates (9,005) Acquisition of loan to affiliate (426,376) Other proceeds from satellites 5,625 Net cash used in investing activities (997,665) Cash flows from financing activities: Proceeds from debtor-in-possession financing 1,000,000 Debtor-in-possession financing fees (59,682) Principal payments on deferred satellite performance incentives (28,831) Net cash provided by financing activities 911,487 Effect of exchange rate changes on cash, cash equivalents and restricted cash 835 Net change in cash, cash equivalents and restricted cash 144,695 Cash, cash equivalents, and restricted cash, beginning of period 755,313 Cash, cash equivalents, and restricted cash, end of period $ 900,008 Reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated Debtors' balance sheet to the total sum of these same amounts shown on the condensed consolidated Debtors' statement of cash flows: Cash and cash equivalents $ 879,191 Restricted cash 20,817 Total cash, cash equivalents and restricted cash reported in the condensed consolidated Debtors' statement of cash flows $ 900,008 |
Background and Summary of Sig_4
Background and Summary of Significant Accounting Policies - Additional Information (Details) $ in Millions | Dec. 05, 2023USD ($) | Dec. 05, 2021USD ($) | Dec. 01, 2020USD ($) | Dec. 31, 2020USD ($)entitySatellite | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Jan. 01, 2020USD ($) |
Significant Accounting Policies [Line Items] | |||||||
Number of satellites under global communications network | Satellite | 52 | ||||||
Number of entities meeting variable interest entity classification as a primary beneficiary | entity | 2 | ||||||
Receivables expected for reimbursable costs associated the FCC final order | $ 405.2 | ||||||
Compensation expense | 10.9 | $ 13.2 | $ 6.8 | ||||
Warranty accrual | 19.6 | ||||||
Increase of reserve for credit losses | $ 0 | $ 4.6 | |||||
Forecast | |||||||
Significant Accounting Policies [Line Items] | |||||||
Proceeds eligible to receive for clearing a portion c-band spectrum | $ 3,700 | $ 1,200 | |||||
Gogo CA | |||||||
Significant Accounting Policies [Line Items] | |||||||
Payments to acquire business | $ 400 | ||||||
Variable Interest Entity, Primary Beneficiary | |||||||
Significant Accounting Policies [Line Items] | |||||||
Number of entities meeting variable interest entity classification as a primary beneficiary | entity | 1 | ||||||
Accounting Standards Update 2016-13 | |||||||
Significant Accounting Policies [Line Items] | |||||||
Increase of reserve for credit losses | $ 0.9 | ||||||
Minimum | |||||||
Significant Accounting Policies [Line Items] | |||||||
Equity method investment, ownership interest percentage | 20.00% | ||||||
Warranty, period | 2 years | ||||||
Maximum | |||||||
Significant Accounting Policies [Line Items] | |||||||
Equity method investment, ownership interest percentage | 50.00% | ||||||
Warranty, period | 10 years |
Background and Summary of Sig_5
Background and Summary of Significant Accounting Policies - Cash and Cash Equivalents and Restricted Cash Reconciliation (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 1,060,917 | $ 810,626 | ||
Restricted cash, current | 21,130 | 20,238 | ||
Restricted cash included in other assets | 5,500 | 0 | ||
Cash, cash equivalents and restricted cash | $ 1,087,547 | $ 830,864 | $ 507,157 | $ 541,391 |
Background and Summary of Sig_6
Background and Summary of Significant Accounting Policies - Estimated Useful Lives of Satellites and Other Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Minimum | Buildings and improvements | |
Property, Plant and Equipment [Line Items] | |
Useful life of assets | 10 years |
Minimum | Satellites and related costs | |
Property, Plant and Equipment [Line Items] | |
Useful life of assets | 10 years |
Minimum | Ground segment equipment and software | |
Property, Plant and Equipment [Line Items] | |
Useful life of assets | 4 years |
Minimum | Furniture and fixtures and computer hardware | |
Property, Plant and Equipment [Line Items] | |
Useful life of assets | 3 years |
Minimum | Leasehold improvements | |
Property, Plant and Equipment [Line Items] | |
Useful life of assets | 2 years |
Minimum | Network equipment | |
Property, Plant and Equipment [Line Items] | |
Useful life of assets | 5 years |
Maximum | Buildings and improvements | |
Property, Plant and Equipment [Line Items] | |
Useful life of assets | 40 years |
Maximum | Satellites and related costs | |
Property, Plant and Equipment [Line Items] | |
Useful life of assets | 17 years |
Maximum | Ground segment equipment and software | |
Property, Plant and Equipment [Line Items] | |
Useful life of assets | 15 years |
Maximum | Furniture and fixtures and computer hardware | |
Property, Plant and Equipment [Line Items] | |
Useful life of assets | 12 years |
Maximum | Leasehold improvements | |
Property, Plant and Equipment [Line Items] | |
Useful life of assets | 13 years |
Maximum | Network equipment | |
Property, Plant and Equipment [Line Items] | |
Useful life of assets | 25 years |
Chapter 11 Proceedings, Abili_3
Chapter 11 Proceedings, Ability to Continue as a Going Concern and Other Related Matters - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 17, 2020 | May 20, 2020 | |
Fresh-Start Adjustment [Line Items] | |||||
Interest payments due which were not paid | $ 495,200 | ||||
Common shares, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 | ||
Cash and cash equivalents | $ 1,060,917 | $ 810,626 | |||
Accumulated deficit | 8,416,410 | 7,503,830 | |||
Income (loss) from operations | 268,996 | 388,596 | $ 941,870 | ||
Net loss | $ 909,271 | $ 911,210 | $ 595,690 | ||
Revolving Credit Facility | Superpriority Secured DIP Credit Facilities due July 2021 | Line of Credit | Intelsat Jackson | |||||
Fresh-Start Adjustment [Line Items] | |||||
Debtor in possession financing, aggregate principal amount | $ 1,000,000 |
Chapter 11 Proceedings, Abili_4
Chapter 11 Proceedings, Ability to Continue as a Going Concern and Other Related Matters - Liabilities Subject to Compromise (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Reorganizations [Abstract] | ||
Accounts payable | $ 9,545 | |
Debt subject to comprise | 9,782,161 | $ 0 |
Accrued interest on debt subject to compromise | 341,676 | |
Other long-term liabilities subject to compromise | 35,136 | |
Total liabilities subject to compromise | $ 10,168,518 | $ 0 |
Chapter 11 Proceedings, Abili_5
Chapter 11 Proceedings, Ability to Continue as a Going Concern and Other Related Matters - Reorganization Items, Net (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Reorganizations [Abstract] | |||
Adjustment of debt discount, premium and issuance costs | $ 196,974 | ||
Debtor-in-possession financing fees | 59,682 | $ 0 | $ 0 |
Professional fees | 129,659 | ||
Other reorganization income | (454) | ||
Total reorganization items | $ 385,861 | $ 0 | $ 0 |
Acquisition of Gogo Commercia_3
Acquisition of Gogo Commercial Aviation - Additional Information (Details) - Gogo CA - USD ($) $ in Millions | Dec. 01, 2020 | Dec. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 |
Business Acquisition [Line Items] | ||||
Payments to acquire business, net | $ 386.4 | |||
Payments to acquire business | 400 | |||
Total purchase consideration | 409.1 | |||
Goodwill, expected tax deductible amount | 66.9 | |||
Contributed revenue | $ 15.6 | |||
Contributed loss | $ 12.9 | |||
Pro forma revenue | $ 2,100 | $ 2,600 | ||
Pro forma net loss | $ 1,200 | $ 971.1 | ||
Acquisition related costs | $ 15.9 |
Acquisition of Gogo Commercia_4
Acquisition of Gogo Commercial Aviation - Allocation of Purchase Consideration (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 01, 2020 | Dec. 31, 2019 |
Amortizable intangible assets | |||
Goodwill | $ 2,698,247 | $ 2,620,627 | |
Gogo CA | |||
Assets acquired | |||
Cash and cash equivalents | $ 9,867 | ||
Receivables, net of allowances | 52,849 | ||
Inventory | 144,014 | ||
Prepaid expenses and other current assets | 36,140 | ||
Property and equipment | 41,328 | ||
Amortizable intangible assets | |||
Goodwill | 77,620 | ||
Other assets | |||
Supplemental type certificates | 24,253 | ||
Line fit certificates | 21,776 | ||
Other assets | 100,566 | ||
Total assets acquired | 554,877 | ||
Current liabilities | |||
Accounts payable and accrued liabilities | (63,300) | ||
Contract liabilities | (13,527) | ||
Other current liabilities | (25,472) | ||
Noncurrent liabilities | (43,522) | ||
Total liabilities assumed | (145,821) | ||
Total purchase consideration | 409,056 | ||
Gogo CA | Software | |||
Amortizable intangible assets | |||
Amortizable intangible assets | 45,464 | ||
Gogo CA | Trade name | |||
Amortizable intangible assets | |||
Amortizable intangible assets | $ 1,000 |
Share Capital (Details)
Share Capital (Details) - USD ($) $ / shares in Units, $ in Millions | Dec. 31, 2020 | May 20, 2020 | Dec. 31, 2019 |
Equity [Abstract] | |||
Authorized share capital | $ 10 | ||
Common shares, authorized (in shares) | 1,000,000,000 | ||
Common shares, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 |
Common shares, issued (in shares) | 142,100,000 | ||
Common shares, outstanding (in shares) | 142,100,000 |
Revenue - Additional Informatio
Revenue - Additional Information (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020USD ($)Customer | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Revenue, Major Customer [Line Items] | |||
Receivables expected for reimbursable costs associated the FCC final order | $ 405,200 | ||
Revenue recognized, previously included in contract liability balance | 237,400 | $ 249,500 | |
Consideration included in contract assets that became unconditional | 15,100 | 9,100 | |
Capitalized contract cost | 5,900 | 7,900 | |
Capitalized contract cost, amortization | 5,000 | 5,900 | |
Capitalized contract cost, net | 10,400 | 9,400 | |
Remaining performance obligation | $ 6,000,000 | ||
Weighted average remaining customer contract life | 4 years | ||
Percentage of remaining performance obligation of consolidated interests included | 100.00% | ||
Revenue | $ 1,913,080 | 2,061,465 | $ 2,161,190 |
Number of major customers | Customer | 10 | ||
Network Services | |||
Revenue, Major Customer [Line Items] | |||
Revenue | $ 677,400 | 770,400 | 798,100 |
Media Services | |||
Revenue, Major Customer [Line Items] | |||
Revenue | 812,500 | 883,000 | 937,700 |
Government Services | |||
Revenue, Major Customer [Line Items] | |||
Revenue | 392,600 | 378,300 | 392,000 |
Satellite-related services | |||
Revenue, Major Customer [Line Items] | |||
Revenue | $ 30,600 | $ 29,800 | $ 33,400 |
Customer Concentration Risk | Revenues | |||
Revenue, Major Customer [Line Items] | |||
Concentration risk, percentage | 14.00% | 14.00% | 11.00% |
Largest customers accounted revenue in percentage | 42.00% | 41.00% | 37.00% |
Minimum | |||
Revenue, Major Customer [Line Items] | |||
Prepayment term on contracts with customers | 1 month | ||
Maximum | |||
Revenue, Major Customer [Line Items] | |||
Prepayment term on contracts with customers | 1 year | ||
Small Subset of Customers | Minimum | |||
Revenue, Major Customer [Line Items] | |||
Prepayment term on contracts with customers | 1 year | ||
Small Subset of Customers | Maximum | |||
Revenue, Major Customer [Line Items] | |||
Prepayment term on contracts with customers | 15 years |
Revenue - Remaining Performance
Revenue - Remaining Performance Obligation (Details) (Details) | Dec. 31, 2020 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, percentage | 41.00% |
Revenue, remaining performance obligation, period | 2 years |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, percentage | 23.00% |
Revenue, remaining performance obligation, period | 2 years |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, percentage | 36.00% |
Revenue, remaining performance obligation, period |
Revenue - Geographic Distributi
Revenue - Geographic Distribution of Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Concentration Risk [Line Items] | |||
Revenue | $ 1,913,080 | $ 2,061,465 | $ 2,161,190 |
North America | |||
Concentration Risk [Line Items] | |||
Revenue | $ 1,019,248 | $ 1,078,100 | $ 1,112,774 |
Concentration risk, percentage | 53.00% | 52.00% | 51.00% |
Europe | |||
Concentration Risk [Line Items] | |||
Revenue | $ 214,573 | $ 243,967 | $ 257,747 |
Concentration risk, percentage | 11.00% | 12.00% | 12.00% |
Latin America and Caribbean | |||
Concentration Risk [Line Items] | |||
Revenue | $ 210,510 | $ 239,856 | $ 284,948 |
Concentration risk, percentage | 11.00% | 12.00% | 13.00% |
Africa and Middle East | |||
Concentration Risk [Line Items] | |||
Revenue | $ 238,305 | $ 250,935 | $ 274,853 |
Concentration risk, percentage | 12.00% | 12.00% | 13.00% |
Asia-Pacific | |||
Concentration Risk [Line Items] | |||
Revenue | $ 230,444 | $ 248,607 | $ 230,868 |
Concentration risk, percentage | 12.00% | 12.00% | 11.00% |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenues (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Reporting Information [Line Items] | |||
Revenue | $ 1,913,080 | $ 2,061,465 | $ 2,161,190 |
On-Network Revenues | |||
Segment Reporting Information [Line Items] | |||
Revenue | 1,672,805 | 1,845,217 | 1,967,792 |
Off-Network and Other Revenues | |||
Segment Reporting Information [Line Items] | |||
Revenue | 224,690 | 216,248 | 193,398 |
In-Flight Services Revenues | |||
Segment Reporting Information [Line Items] | |||
Revenue | 15,585 | 0 | 0 |
Transponder, MSS and other off-network services | On-Network Revenues | |||
Segment Reporting Information [Line Items] | |||
Revenue | 1,372,773 | 1,468,791 | 1,570,278 |
Transponder, MSS and other off-network services | Off-Network and Other Revenues | |||
Segment Reporting Information [Line Items] | |||
Revenue | 182,393 | 175,602 | 150,186 |
Managed services | On-Network Revenues | |||
Segment Reporting Information [Line Items] | |||
Revenue | 298,638 | 374,026 | 393,264 |
Channel | On-Network Revenues | |||
Segment Reporting Information [Line Items] | |||
Revenue | 1,394 | 2,400 | 4,250 |
Satellite-related services | Off-Network and Other Revenues | |||
Segment Reporting Information [Line Items] | |||
Revenue | 42,297 | 40,646 | 43,212 |
Services | In-Flight Services Revenues | |||
Segment Reporting Information [Line Items] | |||
Revenue | 14,122 | 0 | 0 |
Equipment | In-Flight Services Revenues | |||
Segment Reporting Information [Line Items] | |||
Revenue | $ 1,463 | $ 0 | $ 0 |
Service Concentration Risk | Revenues | On-Network Revenues | |||
Segment Reporting Information [Line Items] | |||
Concentration risk, percentage | 87.00% | 89.00% | 91.00% |
Service Concentration Risk | Revenues | Off-Network and Other Revenues | |||
Segment Reporting Information [Line Items] | |||
Concentration risk, percentage | 12.00% | 11.00% | 9.00% |
Service Concentration Risk | Revenues | In-Flight Services Revenues | |||
Segment Reporting Information [Line Items] | |||
Concentration risk, percentage | 1.00% | 0.00% | 0.00% |
Service Concentration Risk | Revenues | Transponder, MSS and other off-network services | On-Network Revenues | |||
Segment Reporting Information [Line Items] | |||
Concentration risk, percentage | 72.00% | 71.00% | 73.00% |
Service Concentration Risk | Revenues | Transponder, MSS and other off-network services | Off-Network and Other Revenues | |||
Segment Reporting Information [Line Items] | |||
Concentration risk, percentage | 10.00% | 9.00% | 7.00% |
Service Concentration Risk | Revenues | Managed services | On-Network Revenues | |||
Segment Reporting Information [Line Items] | |||
Concentration risk, percentage | 15.00% | 18.00% | 18.00% |
Service Concentration Risk | Revenues | Channel | On-Network Revenues | |||
Segment Reporting Information [Line Items] | |||
Concentration risk, percentage | 0.00% | 0.00% | 0.00% |
Service Concentration Risk | Revenues | Satellite-related services | Off-Network and Other Revenues | |||
Segment Reporting Information [Line Items] | |||
Concentration risk, percentage | 2.00% | 2.00% | 2.00% |
Service Concentration Risk | Revenues | Services | In-Flight Services Revenues | |||
Segment Reporting Information [Line Items] | |||
Concentration risk, percentage | 1.00% | 0.00% | 0.00% |
Service Concentration Risk | Revenues | Equipment | In-Flight Services Revenues | |||
Segment Reporting Information [Line Items] | |||
Concentration risk, percentage | 0.00% | 0.00% | 0.00% |
Net Loss per Share - Additional
Net Loss per Share - Additional Information (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | |
Debt Instrument [Line Items] | ||||
Dilutive securities | 0 | 0 | 0 | |
Weighted average number of shares that could potentially dilute basic EPS in the future | 22,200,000 | 26,000,000 | 12,500,000 | |
4.5% Convertible Senior Notes due June 2025 | Intelsat S.A. | Convertible Debt | ||||
Debt Instrument [Line Items] | ||||
Senior notes, interest rate | 4.50% | |||
Principal amount | $ 402,500,000 |
Net Loss per Share - Computatio
Net Loss per Share - Computation of Basic and Diluted Net Loss per Share (Details) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Numerator: | |||
Net loss attributable to Intelsat S.A. | $ (911,664) | $ (913,595) | $ (599,605) |
Denominator: | |||
Basic weighted average shares outstanding (in millions) (in shares) | 142 | 140.4 | 129.6 |
Diluted weighted average shares outstanding (in millions) (in shares) | 142 | 140.4 | 129.6 |
Basic EPS (in dollars per share) | $ (6.42) | $ (6.51) | $ (4.63) |
Diluted EPS (in dollars per share) | $ (6.42) | $ (6.51) | $ (4.63) |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured and Recorded at Fair Value on Recurring Basis (Details) - Fair Value, Recurring - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Assets | ||
Marketable securities | $ 5,205 | $ 5,145 |
Total assets | 8,444 | 8,756 |
(Level 1) | ||
Assets | ||
Marketable securities | 5,205 | 5,145 |
Total assets | 5,205 | 5,145 |
(Level 2) | ||
Assets | ||
Marketable securities | 0 | 0 |
Total assets | 0 | 372 |
(Level 3) | ||
Assets | ||
Marketable securities | 0 | 0 |
Total assets | 3,239 | 3,239 |
Undesignated interest rate cap contracts | ||
Assets | ||
Undesignated interest rate cap contracts/warrant | 372 | |
Undesignated interest rate cap contracts | (Level 1) | ||
Assets | ||
Undesignated interest rate cap contracts/warrant | 0 | |
Undesignated interest rate cap contracts | (Level 2) | ||
Assets | ||
Undesignated interest rate cap contracts/warrant | 372 | |
Undesignated interest rate cap contracts | (Level 3) | ||
Assets | ||
Undesignated interest rate cap contracts/warrant | 0 | |
Warrant | Common Stock | ||
Assets | ||
Undesignated interest rate cap contracts/warrant | 3,239 | 3,239 |
Warrant | Common Stock | (Level 1) | ||
Assets | ||
Undesignated interest rate cap contracts/warrant | 0 | 0 |
Warrant | Common Stock | (Level 2) | ||
Assets | ||
Undesignated interest rate cap contracts/warrant | 0 | 0 |
Warrant | Common Stock | (Level 3) | ||
Assets | ||
Undesignated interest rate cap contracts/warrant | $ 3,239 | $ 3,239 |
Fair Value Measurements - Ass_2
Fair Value Measurements - Assets and Liabilities Measured and Recorded at Fair Value on Recurring Basis (Footnote) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | ||
Cost basis of marketable securities | $ 4 | $ 4.3 |
Cost basis of marketable securities sold | 0.6 | 0.7 |
Gain on marketable securities sold | $ 0.2 | $ 0.2 |
Fair Value Measurement - Reconc
Fair Value Measurement - Reconciliation of Preferred and Common Stock Warrants Measured and Recorded at Fair Value on Recurring Basis (Details) - Level 3 - Common and Preferred Stock - Warrant - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Balance as of beginning of period | $ 3,239 | $ 4,100 |
Purchase of investments | 0 | 3,239 |
Unrealized loss included in other income (expense), net | 0 | (4,100) |
Balance as of end of period | $ 3,239 | $ 3,239 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2020 | |
Trade name | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Impairment of non-amortizable intangible assets | $ 8 | $ 12.2 | $ 157.9 |
Retirement Plans and Other Re_3
Retirement Plans and Other Retiree Benefits - Additional Information (Details) $ in Millions | 3 Months Ended | 12 Months Ended | |||
Mar. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020USD ($)investment_manager | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Defined Benefit Plan Disclosure [Line Items] | |||||
Callable bonds, period from maturity (within) | 6 months | ||||
Target allocation | 100.00% | 100.00% | |||
Number of investment managers managing plan assets | investment_manager | 50 | ||||
Assumed health care cost trend rate | 5.70% | 6.00% | |||
Expected decrease in health care cost trend rate | 4.50% | ||||
Recognized compensation expense | $ 8.9 | $ 8.1 | $ 7.9 | ||
Defined Benefit Plan, Equity Securities | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Target allocation | 49.00% | 49.00% | |||
Defined Benefit Plan, Equity Securities, US | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Target allocation | 29.00% | ||||
Defined Benefit Plan, Equity Securities, Non-US | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Target allocation | 20.00% | ||||
Defined Benefit Plan, Debt Security | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Target allocation | 36.00% | 36.00% | |||
Other Securities | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Target allocation | 15.00% | 15.00% | |||
Hedge Fund | Other Securities | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Target allocation | 5.00% | ||||
Real Estate Funds | Other Securities | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Target allocation | 10.00% | ||||
Pension Benefits | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Estimated contributions to plan in next fiscal year | $ 5.8 | ||||
Accrued benefit costs | 95.9 | $ 88.7 | |||
Accrued benefit costs included in other current liabilities | 0.7 | 0.6 | |||
Accrued benefit costs included in other long-term liabilities | 95.2 | 88.1 | |||
Other Post- retirement Benefits | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Estimated contributions to plan in next fiscal year | 2.6 | ||||
Accrued benefit costs | 36.8 | 39.9 | |||
Accrued benefit costs included in other current liabilities | 2.6 | 2.9 | |||
Accrued benefit costs included in other long-term liabilities | $ 34.2 | $ 37 | |||
Forecast | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Eligible Medicare recipients, annual stipend increase | 3.00% | 3.00% |
Retirement Plans and Other Re_4
Retirement Plans and Other Retiree Benefits - Reconciliation of Funded Status and Accumulated Benefit Obligation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Change in plan assets | |||
Plan assets at beginning of year | $ 334,821 | ||
Plan assets at fair value at end of year | 356,075 | $ 334,821 | |
Amounts in accumulated other comprehensive loss recognized in net periodic benefit cost | |||
Actuarial net (gain) loss, net of tax | 5,096 | 2,943 | $ 4,064 |
Prior service credits, net of tax | (2,504) | (2,502) | (839) |
Pension Benefits | |||
Change in benefit obligation | |||
Benefit obligation at beginning of year | 423,536 | 394,082 | |
Interest cost | 11,850 | 15,390 | 14,428 |
Employee contributions | 0 | 0 | |
Plan amendments | 0 | 0 | |
Benefits paid | (26,350) | (24,875) | |
Actuarial net (gain) loss | 42,917 | 38,939 | |
Benefit obligation at end of year | 451,953 | 423,536 | 394,082 |
Change in plan assets | |||
Plan assets at beginning of year | 334,821 | 297,631 | |
Employer contributions | 3,971 | 4,232 | |
Employee contributions | 0 | 0 | |
Actual return on plan assets | 43,633 | 57,833 | |
Benefits paid | (26,350) | (24,875) | |
Plan assets at fair value at end of year | 356,075 | 334,821 | 297,631 |
Accrued benefit costs and funded status of the plans | (95,878) | (88,715) | |
Accumulated benefit obligation | $ 451,953 | $ 423,536 | |
Weighted average assumptions used to determine accumulated benefit obligation and accrued benefit costs | |||
Discount rate | 2.41% | 3.29% | |
Weighted average assumptions used to determine net periodic benefit costs | |||
Discount rate | 3.29% | 4.35% | |
Expected rate of return on plan assets | 7.60% | 7.60% | |
Amounts in accumulated other comprehensive loss recognized in net periodic benefit cost | |||
Actuarial net (gain) loss, net of tax | $ 6,295 | $ 4,151 | |
Prior service credits, net of tax | 0 | 0 | |
Total | 6,295 | 4,151 | |
Amounts in accumulated other comprehensive loss not yet recognized in net periodic benefit cost | |||
Actuarial net (gain) loss, net of tax | 127,497 | 111,637 | |
Prior service credits, net of tax | 0 | 0 | |
Total | 127,497 | 111,637 | |
Other Post- retirement Benefits | |||
Change in benefit obligation | |||
Benefit obligation at beginning of year | 39,875 | 40,526 | |
Interest cost | 1,064 | 1,532 | 2,314 |
Employee contributions | 157 | 181 | |
Plan amendments | 0 | 0 | |
Benefits paid | (1,920) | (1,787) | |
Actuarial net (gain) loss | (2,343) | (577) | |
Benefit obligation at end of year | 36,833 | 39,875 | 40,526 |
Change in plan assets | |||
Plan assets at beginning of year | 0 | 0 | |
Employer contributions | 1,763 | 1,606 | |
Employee contributions | 157 | 181 | |
Actual return on plan assets | 0 | 0 | |
Benefits paid | (1,920) | (1,787) | |
Plan assets at fair value at end of year | 0 | 0 | $ 0 |
Accrued benefit costs and funded status of the plans | $ (36,833) | $ (39,875) | |
Weighted average assumptions used to determine accumulated benefit obligation and accrued benefit costs | |||
Discount rate | 2.28% | 3.19% | |
Weighted average assumptions used to determine net periodic benefit costs | |||
Discount rate | 3.19% | 4.27% | |
Expected rate of return on plan assets | 0.00% | 0.00% | |
Amounts in accumulated other comprehensive loss recognized in net periodic benefit cost | |||
Actuarial net (gain) loss, net of tax | $ (1,200) | $ (1,208) | |
Prior service credits, net of tax | (2,504) | (2,502) | |
Total | (3,704) | (3,710) | |
Amounts in accumulated other comprehensive loss not yet recognized in net periodic benefit cost | |||
Actuarial net (gain) loss, net of tax | (17,746) | (16,646) | |
Prior service credits, net of tax | (27,508) | (30,011) | |
Total | $ (45,254) | $ (46,657) |
Retirement Plans and Other Re_5
Retirement Plans and Other Retiree Benefits - Target and Actual Asset Allocation of Pension Plan Assets (Details) | Dec. 31, 2020 | Dec. 31, 2019 |
Defined Benefit Plan Disclosure [Line Items] | ||
Target Allocation | 100.00% | 100.00% |
Actual Allocation | 100.00% | 100.00% |
Equity securities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Target Allocation | 49.00% | 49.00% |
Actual Allocation | 48.00% | 48.00% |
Debt securities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Target Allocation | 36.00% | 36.00% |
Actual Allocation | 35.00% | 34.00% |
Other securities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Target Allocation | 15.00% | 15.00% |
Actual Allocation | 17.00% | 18.00% |
Retirement Plans and Other Re_6
Retirement Plans and Other Retiree Benefits - Fair Values of Pension Plan Assets by Asset Category (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | $ 356,075 | $ 334,821 |
Pre-notification period | 95 days | |
Lockup period on expired purchases | 2 years | |
Level 1 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | $ 294,479 | 275,485 |
Level 2 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 0 | 0 |
Level 3 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 0 | 0 |
U.S. Large-Cap | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 79,619 | 75,380 |
U.S. Large-Cap | Level 1 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 79,619 | 75,380 |
U.S. Large-Cap | Level 2 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 0 | 0 |
U.S. Large-Cap | Level 3 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 0 | 0 |
U.S. Small/Mid-Cap | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 20,569 | 19,566 |
U.S. Small/Mid-Cap | Level 1 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 20,569 | 19,566 |
U.S. Small/Mid-Cap | Level 2 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 0 | 0 |
U.S. Small/Mid-Cap | Level 3 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 0 | 0 |
World Equity Ex-US | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 69,736 | 65,882 |
World Equity Ex-US | Level 1 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 69,736 | 65,882 |
World Equity Ex-US | Level 2 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 0 | 0 |
World Equity Ex-US | Level 3 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 0 | 0 |
Long Duration Bonds | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 103,827 | 95,327 |
Long Duration Bonds | Level 1 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 103,827 | 95,327 |
Long Duration Bonds | Level 2 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 0 | 0 |
Long Duration Bonds | Level 3 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 0 | 0 |
High Yield Bonds | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 10,352 | 9,610 |
High Yield Bonds | Level 1 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 10,352 | 9,610 |
High Yield Bonds | Level 2 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 0 | 0 |
High Yield Bonds | Level 3 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 0 | 0 |
Emerging Market Fixed income (Non-US) | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 10,376 | 9,720 |
Emerging Market Fixed income (Non-US) | Level 1 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 10,376 | 9,720 |
Emerging Market Fixed income (Non-US) | Level 2 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 0 | 0 |
Emerging Market Fixed income (Non-US) | Level 3 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 0 | 0 |
Hedge Funds | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 20,263 | 18,803 |
Core Property Fund | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | 41,036 | 40,205 |
Income earned but not yet received | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of pension plan assets | $ 297 | $ 328 |
Retirement Plans and Other Re_7
Retirement Plans and Other Retiree Benefits - Components of Net Periodic Benefit Costs (Income) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Pension Benefits | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Interest cost | $ 11,850 | $ 15,390 | $ 14,428 |
Expected return on plan assets | (23,242) | (23,490) | (24,482) |
Amortization of unrecognized net (gain) loss | 6,399 | 4,221 | 5,307 |
Total costs (income) | (4,993) | (3,879) | (4,747) |
Other Post- retirement Benefits | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Interest cost | 1,064 | 1,532 | 2,314 |
Amortization of prior service credit | (2,545) | (2,544) | (854) |
Amortization of unrecognized net (gain) loss | (1,220) | (1,229) | (630) |
Total costs (income) | $ (2,701) | $ (2,241) | $ 830 |
Retirement Plans and Other Re_8
Retirement Plans and Other Retiree Benefits - Benefits Expected to be Paid Next Five Years (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Pension Benefits | |
Defined Benefit Plan Disclosure [Line Items] | |
2021 | $ 42,185 |
2022 | 28,969 |
2023 | 28,509 |
2024 | 27,146 |
2025 | 26,457 |
2026 to 2030 | 123,572 |
Total | 276,838 |
Other Post- retirement Benefits | |
Defined Benefit Plan Disclosure [Line Items] | |
2021 | 2,605 |
2022 | 2,609 |
2023 | 2,546 |
2024 | 2,492 |
2025 | 2,411 |
2026 to 2030 | 11,029 |
Total | $ 23,692 |
Satellites and Other Property_3
Satellites and Other Property and Equipment - Schedule of Satellites and Other Property and Equipment, Net (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Property, Plant and Equipment [Line Items] | ||
Satellites and other property and equipment, cost | $ 11,884,330 | $ 11,656,281 |
Less: accumulated depreciation | (7,126,453) | (6,954,218) |
Total | 4,757,877 | 4,702,063 |
Satellites and launch vehicles | ||
Property, Plant and Equipment [Line Items] | ||
Satellites and other property and equipment, cost | 10,500,021 | 10,407,690 |
Information systems and ground segment | ||
Property, Plant and Equipment [Line Items] | ||
Satellites and other property and equipment, cost | 1,062,216 | 968,482 |
Buildings and other | ||
Property, Plant and Equipment [Line Items] | ||
Satellites and other property and equipment, cost | $ 322,093 | $ 280,109 |
Satellites and Other Property_4
Satellites and Other Property and Equipment - Additional Information (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||
Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment [Line Items] | ||||||
Impairment of satellites and other property and equipment | $ 0 | $ 0 | ||||
Construction-in-progress | 768,600,000 | $ 191,500,000 | ||||
Costs and expenses incurred related to c-band clearing | 505,300,000 | |||||
Capitalized costs and expenses related to c-band | 471,700,000 | |||||
Costs expected to be reimbursed related to c-band | 466,900,000 | |||||
Capitalized interest | 35,000,000 | 31,500,000 | ||||
Depreciation expense | 618,500,000 | 623,300,000 | $ 649,100,000 | |||
Impairment of non-amortizable intangible and other assets | $ 34,000,000 | 191,943,000 | 0 | 0 | ||
Satellite impairment loss | $ 381,600,000 | 0 | $ 381,565,000 | $ 0 | ||
Write off of the carrying value of the satellite and associated deferred performance incentive obligations | 377,900,000 | |||||
Impairment of prepaid regulatory fees | $ 3,700,000 | |||||
Property, Plant and Equipment | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Capitalized costs and expenses related to c-band | 432,500,000 | |||||
Other Current Assets | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Capitalized costs and expenses related to c-band | $ 39,200,000 |
Investments (Details)
Investments (Details) | 12 Months Ended | ||
Dec. 31, 2020USD ($)companyinvestmententity | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Schedule of Investments [Line Items] | |||
Number of entities meeting variable interest entity classification | entity | 2 | ||
Total assets | $ 12,797,681,000 | $ 11,804,382,000 | |
Percentage of revenue to JSAT | 50.00% | ||
Number of privately held companies in which noncontrolling equity investments are held | company | 6 | ||
Carrying value of equity securities without readily determinable fair values | $ 31,900,000 | 27,200,000 | |
Impairment loss of equity securities without readily determinable fair values | 100,000 | 36,800,000 | $ 0 |
Increase in fair value of equity securities without readily determinable fair values | 0 | 1,700,000 | 0 |
Equity securities, fair value | $ 3,200,000 | 3,200,000 | |
Number of privately held companies which loan receivables are carried from | company | 3 | ||
Loan receivables, total amortized costs basis | $ 71,200,000 | 70,400,000 | |
Allowance for loan losses | 0 | 4,600,000 | |
Unamortized discount on loan receivable | 700,000 | 3,000,000 | |
Unamortized deferred transaction costs on loan receivable | 200,000 | 1,000,000 | |
Accrued interest on loan receivable | 1,900,000 | 1,500,000 | |
Interest income on loan receivables | 3,900,000 | 1,500,000 | 0 |
Loan receivable, impairment losses | 600,000 | 4,600,000 | 0 |
Loan receivable, fair value | $ 72,900,000 | 69,300,000 | |
Horizons Satellite Holdings | |||
Schedule of Investments [Line Items] | |||
Number of investments | investment | 2 | ||
Total assets | $ 14,200,000 | 22,200,000 | |
Total liabilities | 0 | 0 | |
Revenue share, net of applicable fees and commissions | $ 1,800,000 | 1,600,000 | |
Equity Method Investee | Horizons-3 Satellite LLC | |||
Schedule of Investments [Line Items] | |||
Percentage of revenue to JSAT | 50.00% | ||
Revenue share, net of applicable fees and commissions | $ 5,000,000 | 3,300,000 | |
Ownership percentage | 50.00% | ||
Equity method investments | $ 103,800,000 | 110,200,000 | |
Amount investment balance exceeded equity in net assets | $ 10,900,000 | 11,600,000 | |
Capital contribution in percent | 50.00% | ||
Equity method investment, ownership interest percentage | 50.00% | ||
Payments for advance to affiliate | $ 2,700,000 | 5,000,000 | 41,200,000 |
Distributions received | 9,000,000 | 5,000,000 | 0 |
Expenses from transaction with related party | 19,000,000 | 19,900,000 | 0 |
Revenue from transaction with related party | 7,000,000 | 5,600,000 | $ 0 |
Receivables from related party | 0 | 500,000 | |
Accounts payable and accrued liabilities due to related party | $ 1,500,000 | $ 1,700,000 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Carrying Amounts of Goodwill (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Goodwill | $ 6,858,447 | $ 6,780,827 |
Accumulated impairment losses | (4,160,200) | (4,160,200) |
Net carrying amount | $ 2,698,247 | $ 2,620,627 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Additional Information (Details) | 3 Months Ended | 12 Months Ended | ||||
Dec. 31, 2020USD ($)reporting_unit | Mar. 31, 2020USD ($)reporting_unit | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 01, 2020USD ($) | |
Finite-Lived Intangible Assets [Line Items] | ||||||
Number of reporting units | reporting_unit | 2 | 1 | ||||
Projection period used in discounted cash flow analysis for estimated fair of reporting unit | 6 years | |||||
Impairment for goodwill | $ 0 | |||||
Goodwill | $ 2,698,247,000 | $ 2,698,247,000 | $ 2,620,627,000 | |||
Impairment of satellites and other property and equipment | 0 | 0 | ||||
Amortization expense | $ 33,000,000 | $ 34,400,000 | $ 38,500,000 | |||
Legacy Intelsat | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Reporting unit, percentage of fair value in excess of carrying value | 0.90% | 0.90% | ||||
Gogo CA | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Goodwill | $ 77,620,000 | |||||
Orbital locations | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Impairment of non-amortizable intangible assets | $ 137,700,000 | 0 | ||||
Trade name | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Impairment of non-amortizable intangible assets | $ 8,000,000 | $ 12,200,000 | $ 157,900,000 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Carrying Amounts of Acquired Intangible Assets Not Subject to Amortization (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Indefinite-lived Intangible Assets [Line Items] | ||
Non-amortizable intangible assets | $ 2,295,000 | $ 2,452,900 |
Orbital locations | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Non-amortizable intangible assets | 2,250,000 | 2,387,700 |
Trade name | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Non-amortizable intangible assets | $ 45,000 | $ 65,200 |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets - Schedule of Acquired Intangible Assets (Details) $ in Thousands | Dec. 01, 2020USD ($) |
Finite-Lived Intangible Assets [Line Items] | |
Estimated Fair Value | $ 46,464 |
Software | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated Fair Value | $ 45,464 |
Weighted Average Amortization Period (in years) | 3 years 7 months 6 days |
Trade name | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated Fair Value | $ 1,000 |
Weighted Average Amortization Period (in years) | 2 years |
Goodwill and Other Intangible_7
Goodwill and Other Intangible Assets - Carrying Amount and Accumulated Amortization of Acquired Intangible Assets Subject to Amortization (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 1,324,598 | $ 1,277,790 |
Accumulated Amortization | (1,034,029) | (1,001,038) |
Net Carrying Amount | 290,569 | 276,752 |
Backlog and other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 744,760 | 743,760 |
Accumulated Amortization | (722,697) | (713,205) |
Net Carrying Amount | 22,063 | 30,555 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 534,030 | 534,030 |
Accumulated Amortization | (309,486) | (287,833) |
Net Carrying Amount | 224,544 | 246,197 |
Software | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 45,808 | 0 |
Accumulated Amortization | (1,846) | 0 |
Net Carrying Amount | $ 43,962 | $ 0 |
Goodwill and Other Intangible_8
Goodwill and Other Intangible Assets - Scheduled Amortization Charges for Intangible Assets (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2021 | $ 41,193 |
2022 | 36,199 |
2023 | 28,476 |
2024 | 22,612 |
2025 | $ 15,945 |
Debt - Carrying Values and Fair
Debt - Carrying Values and Fair Values of Notes Payable and Long-Term Debt (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Debt Instrument [Line Items] | ||
Carrying Value | $ 15,685,885 | $ 14,465,483 |
Fair Value | 11,441,122 | 13,117,031 |
Less: current portion of long-term debt, carrying value | 5,903,724 | 0 |
Less: current portion of long-term debt, fair value | 6,068,372 | 0 |
Less: liabilities subject to compromise, carrying value | 9,782,161 | 0 |
Less: liabilities subject to compromise, fair value | 5,372,750 | 0 |
Total Intelsat S.A. long-term debt, carrying value | 0 | 14,465,483 |
Total Intelsat S.A. long-term debt, carrying value, fair value | 0 | 13,117,031 |
Debt discount, premium and issuance costs included within reorganization items | 196,974 | |
Intelsat Jackson | ||
Debt Instrument [Line Items] | ||
Carrying Value | 12,723,724 | 11,670,864 |
Fair Value | 10,845,697 | 11,125,009 |
Convertible Debt | Intelsat S.A. | ||
Debt Instrument [Line Items] | ||
Carrying Value | 402,500 | 269,190 |
Fair Value | $ 130,813 | 265,231 |
Convertible Debt | Intelsat S.A. | 4.5% Convertible Senior Notes due June 2025 | ||
Debt Instrument [Line Items] | ||
Senior notes, interest rate | 4.50% | |
Carrying value, gross | $ 402,500 | 402,500 |
Carrying value, unamortized prepaid debt issuance costs, discount and premium | 0 | (133,310) |
Fair Value | 130,813 | 265,231 |
Senior Notes | Intelsat Luxembourg | ||
Debt Instrument [Line Items] | ||
Carrying Value | 1,824,569 | 1,633,130 |
Fair Value | $ 187,095 | 1,204,127 |
Senior Notes | Intelsat Luxembourg | 7.75% Senior Notes due June 2021 | ||
Debt Instrument [Line Items] | ||
Senior notes, interest rate | 7.75% | |
Carrying value, gross | $ 421,219 | 421,219 |
Carrying value, unamortized prepaid debt issuance costs | 0 | (1,257) |
Carrying Value | 421,200 | |
Fair Value | $ 14,743 | 336,975 |
Senior Notes | Intelsat Luxembourg | 8.125% Senior Notes due June 2023 | ||
Debt Instrument [Line Items] | ||
Senior notes, interest rate | 8.125% | |
Carrying value, gross | $ 1,000,000 | 1,000,000 |
Carrying value, unamortized prepaid debt issuance costs | 0 | (5,838) |
Carrying Value | 1,000,000 | |
Fair Value | $ 130,000 | 590,000 |
Senior Notes | Intelsat Luxembourg | 12.5% Senior Notes due November 2024 | ||
Debt Instrument [Line Items] | ||
Senior notes, interest rate | 12.50% | |
Carrying value, gross | $ 403,350 | 403,350 |
Carrying value, unamortized prepaid debt issuance costs, discount and premium | 0 | (184,344) |
Carrying Value | 403,400 | |
Fair Value | 42,352 | 277,152 |
Senior Notes | Intelsat Connect Finance | ||
Debt Instrument [Line Items] | ||
Carrying Value | 1,250,000 | 1,222,259 |
Fair Value | 334,375 | 865,625 |
Senior Notes | Intelsat Connect Finance | Eliminations | ||
Debt Instrument [Line Items] | ||
Carrying Value | (514,908) | (329,960) |
Fair Value | (56,858) | (342,961) |
Senior Notes | Intelsat Connect Finance | 12.5% Senior Notes due November 2024 | ||
Debt Instrument [Line Items] | ||
Carrying Value | $ 182,000 | |
Senior Notes | Intelsat Connect Finance | 9.5% Senior Notes due February 2023 | ||
Debt Instrument [Line Items] | ||
Senior notes, interest rate | 9.50% | |
Carrying value, gross | $ 1,250,000 | 1,250,000 |
Carrying value, unamortized prepaid debt issuance costs, discount and premium | 0 | (27,741) |
Carrying Value | 1,300,000 | |
Fair Value | 334,375 | 865,625 |
Senior Notes | Intelsat Jackson | 12.5% Senior Notes due November 2024 | ||
Debt Instrument [Line Items] | ||
Carrying Value | $ 220,600 | |
Senior Notes | Intelsat Jackson | 9.5% Senior Secured Notes due September 2022 | ||
Debt Instrument [Line Items] | ||
Senior notes, interest rate | 9.50% | |
Carrying value, gross | $ 490,000 | 490,000 |
Carrying value, unamortized prepaid debt issuance costs, discount and premium | (7,495) | (11,204) |
Carrying Value | 490,000 | |
Fair Value | $ 543,900 | 562,275 |
Senior Notes | Intelsat Jackson | 8% Senior Secured Notes due February 2024 | ||
Debt Instrument [Line Items] | ||
Senior notes, interest rate | 8.00% | |
Carrying value, gross | $ 1,349,678 | 1,349,678 |
Carrying value, unamortized prepaid debt issuance costs, discount and premium | (3,072) | (3,903) |
Carrying Value | 1,300,000 | |
Fair Value | $ 1,373,297 | 1,380,046 |
Senior Notes | Intelsat Jackson | 5.5% Senior Notes due August 2023 | ||
Debt Instrument [Line Items] | ||
Senior notes, interest rate | 5.50% | |
Carrying value, gross | $ 1,985,000 | 1,985,000 |
Carrying value, unamortized prepaid debt issuance costs | 0 | (8,723) |
Carrying Value | 2,000,000 | |
Fair Value | $ 1,349,800 | 1,687,250 |
Senior Notes | Intelsat Jackson | 9.75% Senior Notes due July 2025 | ||
Debt Instrument [Line Items] | ||
Senior notes, interest rate | 9.75% | |
Carrying value, gross | $ 1,885,000 | 1,885,000 |
Carrying value, unamortized prepaid debt issuance costs | 0 | (20,487) |
Carrying Value | 1,900,000 | |
Fair Value | $ 1,347,775 | 1,729,488 |
Senior Notes | Intelsat Jackson | 8.5% Senior Notes due October 2024 | ||
Debt Instrument [Line Items] | ||
Senior notes, interest rate | 8.50% | |
Carrying value, gross | $ 2,950,000 | 2,950,000 |
Carrying value, unamortized prepaid debt issuance costs, discount and premium | 0 | (12,916) |
Carrying Value | 3,000,000 | |
Fair Value | 2,079,750 | 2,669,750 |
Senior Notes | Intelsat Jackson | 8.125% Senior Notes of Intelsat Luxembourg due June 2023 owned by Intelsat Jackson | ||
Debt Instrument [Line Items] | ||
Carrying Value | $ 111,700 | |
Senior Notes | Intelsat Jackson | 8.125% Senior Notes of Intelsat Luxembourg due June 2023 owned by Intelsat Jackson | Eliminations | ||
Debt Instrument [Line Items] | ||
Senior notes, interest rate | 8.125% | |
Carrying value, gross | $ (111,663) | (111,663) |
Carrying value, unamortized prepaid debt issuance costs | 0 | 652 |
Fair Value | $ (14,517) | (65,881) |
Senior Notes | Intelsat Connect Finance, Intel Jackson and Intelsat Envision | 12.5% Senior Notes due November 2024 | Eliminations | ||
Debt Instrument [Line Items] | ||
Senior notes, interest rate | 12.50% | |
Carrying value, gross | $ (403,245) | (403,245) |
Carrying value, unamortized prepaid debt issuance costs, discount and premium | 0 | 184,296 |
Fair Value | (42,341) | (277,080) |
Secured Debt | Line of Credit | Intelsat Jackson | Senior Secured Credit Facilities due November 2023 | ||
Debt Instrument [Line Items] | ||
Carrying value, gross | 2,000,000 | 2,000,000 |
Carrying value, unamortized prepaid debt issuance costs, discount and premium | (16,955) | (22,149) |
Fair Value | 2,025,000 | 1,985,000 |
Secured Debt | Line of Credit | Intelsat Jackson | Senior Secured Credit Facilities due January 2024 | ||
Debt Instrument [Line Items] | ||
Carrying value, gross | 395,000 | 395,000 |
Carrying value, unamortized prepaid debt issuance costs, discount and premium | (1,238) | (1,600) |
Fair Value | $ 400,925 | 398,950 |
Secured Debt | Line of Credit | Intelsat Jackson | 6.625% Senior Secured Credit Facilities due January 2024 | ||
Debt Instrument [Line Items] | ||
Senior notes, interest rate | 6.625% | |
Carrying value, gross | $ 700,000 | 700,000 |
Carrying value, unamortized prepaid debt issuance costs, discount and premium | (2,194) | (2,832) |
Fair Value | 714,000 | $ 712,250 |
Revolving Credit Facility | Line of Credit | Intelsat Jackson | Superpriority Secured DIP Credit Facilities due July 2021 | ||
Debt Instrument [Line Items] | ||
Carrying value, gross | 1,000,000 | |
Fair Value | $ 1,011,250 |
Debt - Additional Information (
Debt - Additional Information (Details) - USD ($) | Dec. 14, 2020 | Nov. 27, 2020 | Jun. 17, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2019 | Jun. 30, 2018 |
Debt Instrument [Line Items] | ||||||||
Proceeds from debtor-in-possession financing | $ 1,000,000,000 | $ 0 | $ 0 | |||||
Aggregate principal amount of senior notes | 15,685,885,000 | 14,465,483,000 | ||||||
Intelsat Jackson | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount of senior notes | 12,723,724,000 | 11,670,864,000 | ||||||
Intelsat Jackson | 12.5% Senior Notes due November 2024 | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount of senior notes | 220,600,000 | |||||||
Intelsat Jackson | Superpriority Secured DIP Credit Facilities due July 2021 | Line of Credit | Revolving Credit Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Debtor in possession financing, aggregate principal amount | $ 1,000,000,000 | |||||||
Principal amount | 500,000,000 | |||||||
Maximum borrowing capacity per draw | $ 250,000,000 | |||||||
Proceeds from debtor-in-possession financing | $ 250,000,000 | $ 250,000,000 | ||||||
Debtor-in-possession financing, borrowings outstanding | 1,000,000,000 | |||||||
Ticking fee | 3.60% | |||||||
Interest rate in event of debt default | 2.00% | |||||||
Aggregate principal amount | 1,000,000,000 | |||||||
Intelsat Jackson | Superpriority Secured DIP Credit Facilities due July 2021 | Line of Credit | Revolving Credit Facility | Base Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 4.50% | |||||||
Intelsat Jackson | Superpriority Secured DIP Credit Facilities due July 2021 | Line of Credit | Revolving Credit Facility | Fed Funds Effective Rate Overnight Index Swap Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 0.50% | |||||||
Intelsat Jackson | Superpriority Secured DIP Credit Facilities due July 2021 | Line of Credit | Revolving Credit Facility | London Interbank Offered Rate (LIBOR), One Month Interest Period | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 1.00% | |||||||
Intelsat Jackson | Superpriority Secured DIP Credit Facilities due July 2021 | Line of Credit | Revolving Credit Facility | London Interbank Offered Rate (LIBOR) | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 5.50% | |||||||
Basis spread on variable rate, floor | 1.00% | |||||||
Intelsat Jackson | Senior Notes Due 2025 | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal amount | $ 400,000,000 | |||||||
Senior notes, interest rate | 9.75% | |||||||
Intelsat Jackson | 8.125% Senior Notes of Intelsat Luxembourg due June 2023 owned by Intelsat Jackson | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount of senior notes | $ 111,700,000 | |||||||
Intelsat Jackson | 9.5% Senior Secured Notes due September 2022 | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Senior notes, interest rate | 9.50% | |||||||
Aggregate principal amount of senior notes | $ 490,000,000 | |||||||
Aggregate principal amount | $ 490,000,000 | 490,000,000 | ||||||
Intelsat Jackson | 8% Senior Secured Notes due February 2024 | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Senior notes, interest rate | 8.00% | |||||||
Aggregate principal amount of senior notes | $ 1,300,000,000 | |||||||
Aggregate principal amount | $ 1,349,678,000 | 1,349,678,000 | ||||||
Intelsat Jackson | 5.5% Senior Notes due August 2023 | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Senior notes, interest rate | 5.50% | |||||||
Aggregate principal amount of senior notes | $ 2,000,000,000 | |||||||
Aggregate principal amount | $ 1,985,000,000 | 1,985,000,000 | ||||||
Intelsat Jackson | 9.75% Senior Notes due July 2025 | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Senior notes, interest rate | 9.75% | |||||||
Aggregate principal amount of senior notes | $ 1,900,000,000 | |||||||
Early redemption price equal to percentage of principal amount of notes | 100.00% | |||||||
Aggregate principal amount | $ 1,885,000,000 | 1,885,000,000 | ||||||
Intelsat Jackson | 8.5% Senior Notes due October 2024 | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Senior notes, interest rate | 8.50% | |||||||
Aggregate principal amount of senior notes | $ 3,000,000,000 | |||||||
Aggregate principal amount | 2,950,000,000 | 2,950,000,000 | ||||||
Intelsat Jackson | Senior Secured Credit Facilities due November 2023 | Line of Credit | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount | $ 2,000,000,000 | 2,000,000,000 | ||||||
Intelsat Jackson | Senior Secured Credit Facilities due November 2023 | Line of Credit | Secured Debt | Base Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 2.75% | |||||||
Intelsat Jackson | Senior Secured Credit Facilities due November 2023 | Line of Credit | Secured Debt | London Interbank Offered Rate (LIBOR) | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 3.75% | |||||||
Intelsat Jackson | Senior Secured Credit Facilities due January 2024 | Line of Credit | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount | $ 395,000,000 | 395,000,000 | ||||||
Intelsat Jackson | Senior Secured Credit Facilities due January 2024 | Line of Credit | Secured Debt | Base Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 3.50% | |||||||
Intelsat Jackson | Senior Secured Credit Facilities due January 2024 | Line of Credit | Secured Debt | London Interbank Offered Rate (LIBOR) | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 4.50% | |||||||
Intelsat Jackson | 6.625% Senior Secured Credit Facilities due January 2024 | Line of Credit | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Senior notes, interest rate | 6.625% | |||||||
Aggregate principal amount | $ 700,000,000 | 700,000,000 | ||||||
Intelsat Jackson | Senior Secured Credit Facilities Due November 2023 And January 2024 | Line of Credit | Secured Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Incremental default rate | 2.00% | |||||||
Intelsat S.A. | Convertible Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount of senior notes | $ 402,500,000 | 269,190,000 | ||||||
Intelsat S.A. | 4.5% Convertible Senior Notes due June 2025 | Convertible Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal amount | $ 402,500,000 | |||||||
Senior notes, interest rate | 4.50% | |||||||
Aggregate principal amount | $ 402,500,000 | 402,500,000 | ||||||
Intelsat Luxembourg | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount of senior notes | $ 1,824,569,000 | 1,633,130,000 | ||||||
Intelsat Luxembourg | 8.125% Senior Notes due June 2023 | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Senior notes, interest rate | 8.125% | |||||||
Aggregate principal amount of senior notes | $ 1,000,000,000 | |||||||
Aggregate principal amount | $ 1,000,000,000 | 1,000,000,000 | ||||||
Intelsat Luxembourg | 12.5% Senior Notes due November 2024 | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Senior notes, interest rate | 12.50% | |||||||
Aggregate principal amount of senior notes | $ 403,400,000 | |||||||
Aggregate principal amount | $ 403,350,000 | 403,350,000 | ||||||
Intelsat Luxembourg | 7.75% Senior Notes due June 2021 | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Senior notes, interest rate | 7.75% | |||||||
Aggregate principal amount of senior notes | $ 421,200,000 | |||||||
Aggregate principal amount | 421,219,000 | 421,219,000 | ||||||
Intelsat Connect Finance | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount of senior notes | 1,250,000,000 | 1,222,259,000 | ||||||
Intelsat Connect Finance | 12.5% Senior Notes due November 2024 | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount of senior notes | $ 182,000,000 | |||||||
Intelsat Connect Finance | 9.5% Senior Notes due February 2023 | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Senior notes, interest rate | 9.50% | |||||||
Aggregate principal amount of senior notes | $ 1,300,000,000 | |||||||
Aggregate principal amount | 1,250,000,000 | $ 1,250,000,000 | ||||||
Intelsat Envision | 12.5% Senior Notes due November 2024 | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount of senior notes | $ 700,000 |
Derivative Instruments and He_3
Derivative Instruments and Hedging Activities - Additional Information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Other assets | Preferred stock warrant | Derivatives not designated as hedging instruments | ||
Derivatives, Fair Value [Line Items] | ||
Derivatives, fair value | $ 0 | $ 0 |
Interest Rate Caps | ||
Derivatives, Fair Value [Line Items] | ||
Notional value | 2,400,000,000 | 2,400,000,000 |
Settlement payments received related to interest rate cap contracts | 0 | 9,800,000 |
Interest Rate Caps | Other assets | Derivatives not designated as hedging instruments | ||
Derivatives, Fair Value [Line Items] | ||
Derivatives, fair value | $ 0 | $ 372,000 |
Derivative Instruments and He_4
Derivative Instruments and Hedging Activities - Fair Value of Derivatives by Category (Details) - Derivatives not designated as hedging instruments - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Derivatives, Fair Value [Line Items] | ||
Total derivatives | $ 3,239 | $ 3,611 |
Other assets | Common stock warrant | ||
Derivatives, Fair Value [Line Items] | ||
Derivatives, fair value | 3,239 | 3,239 |
Other assets | Interest rate cap contracts | ||
Derivatives, Fair Value [Line Items] | ||
Derivatives, fair value | $ 0 | $ 372 |
Derivative Instruments and He_5
Derivative Instruments and Hedging Activities - Effect of Derivative Instruments on Condensed Consolidated Statements of Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Derivative [Line Items] | |||
Total gain (loss) on derivative financial instruments | $ (372) | $ (27,018) | $ 14,435 |
Gain (loss) included in interest expense, net | Interest rate cap contracts | |||
Derivative [Line Items] | |||
Interest rate cap contracts/preferred stock warrant | (372) | (22,918) | 14,435 |
Loss included in other income (expense), net | Preferred stock warrant | |||
Derivative [Line Items] | |||
Interest rate cap contracts/preferred stock warrant | $ 0 | $ (4,100) | $ 0 |
Leases - Additional Information
Leases - Additional Information (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020USD ($)renewal_optioncontract | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Lessee, Lease, Description [Line Items] | |||
Number of renewal options | renewal_option | 1 | ||
Termination period within inception of lease | 6 months | ||
Operating leases not yet commenced | $ 75 | ||
Operating leases not yet commenced, lease term | 5 years | ||
Number of sales-type leases | contract | 2 | ||
Sales-type lease, revenue | $ 14.7 | ||
Sales-type lease, direct costs of revenue | 16.2 | ||
Net loss at commencement of the sales-type lease | $ 1.5 | ||
Sales-type lease, option to terminate, minimum written notice period | 1 year | ||
Sales-type lease, revenue | $ 3.1 | ||
Sales-type lease, direct costs of revenue | 2.4 | ||
Net profit at commencement of the sales-type lease | $ 0.7 | ||
Net investment on sales-type leases | $ 13.9 | ||
Sales-type receivable | 14.1 | ||
Sales-type receivable in 2021 | 2.2 | ||
Sales-type receivable in 2022 | 2.2 | ||
Sales-type receivable in 2023 | 1.3 | ||
Sales-type receivable in 2024 | 1.3 | ||
Sales-type receivable in 2025 | 1.3 | ||
Sales-type receivable in 2026 and thereafter | $ 5.8 | ||
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Renewal terms | 1 year | ||
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Renewal terms | 15 years | ||
Prepaid Expenses and Other Current Assets | |||
Lessee, Lease, Description [Line Items] | |||
Net investment on sales-type leases | $ 2 | ||
Other assets | |||
Lessee, Lease, Description [Line Items] | |||
Net investment on sales-type leases | $ 11.9 |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information Related to Right-of-Use Assets and Lease Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Assets | ||
Operating | $ 10,497 | $ 10,084 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Other assets | |
Finance | $ 163,834 | 86,780 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Other assets | |
Total leased assets | $ 174,331 | 96,864 |
Current | ||
Operating | $ 19,397 | $ 12,744 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Other current liabilities | Other current liabilities |
Finance | $ 2,891 | $ 2,215 |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | Other current liabilities | Other current liabilities |
Long-term | ||
Operating | $ 166,229 | $ 99,072 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Other long-term liabilities | Other long-term liabilities |
Finance | $ 15,325 | $ 16,137 |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Other long-term liabilities | Other long-term liabilities |
Total lease liabilities | $ 203,842 | $ 130,168 |
Accumulated amortization, finance lease | $ 2,500 | $ 500 |
Leases - Supplemental Informati
Leases - Supplemental Information Related to the Components of Lease Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Finance lease cost | ||
Amortization of leased assets | $ 1,953 | $ 542 |
Interest on lease liabilities | 1,708 | 813 |
Sublease income | (953) | (1,206) |
Net lease cost | 34,898 | 20,518 |
Direct costs of revenue | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease cost | 24,770 | 14,210 |
Selling, general and administrative expenses | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease cost | $ 7,420 | $ 6,159 |
Leases - Future Minimum Lease P
Leases - Future Minimum Lease Payments (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Operating Leases | ||
2021 | $ 26,886 | |
2022 | 36,770 | |
2023 | 36,256 | |
2024 | 34,364 | |
2025 | 22,376 | |
2026 and thereafter | 96,546 | |
Total lease payments | 253,198 | |
Less: Imputed interest | 67,572 | |
Present value of lease liabilities | 185,626 | |
Finance Leases | ||
2021 | 4,184 | |
2022 | 3,905 | |
2023 | 3,835 | |
2024 | 2,239 | |
2025 | 1,918 | |
2026 and thereafter | 7,917 | |
Total lease payments | 23,998 | |
Less: Imputed interest | 5,782 | |
Present value of lease liabilities | 18,216 | |
Total | ||
2021 | 31,070 | |
2022 | 40,675 | |
2023 | 40,091 | |
2024 | 36,603 | |
2025 | 24,294 | |
2026 and thereafter | 104,463 | |
Total lease payments | 277,196 | |
Less: Imputed interest | 73,354 | |
Total lease liabilities | $ 203,842 | $ 130,168 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Leases [Abstract] | ||
Operating cash flows from operating leases | $ 32,993 | $ 20,919 |
Leased assets obtained in exchange for new operating lease liabilities | 63,444 | 98,621 |
Leased assets obtained in exchange for new finance lease liabilities | 3,127 | 10,626 |
ROU asset reductions due to modifications/renewals/terminations - operating leases | $ (8,669) | $ 0 |
Leases - Weighted Average Remai
Leases - Weighted Average Remaining Lease Term and Weighted Average Discount Rate (Details) | Dec. 31, 2020 | Dec. 31, 2019 |
Weighted average remaining lease term (in years) | ||
Operating leases | 7 years 10 months 24 days | 8 years 10 months 24 days |
Finance leases | 7 years 3 months 18 days | 8 years |
Weighted average discount rate | ||
Operating leases | 7.70% | 7.40% |
Finance leases | 7.90% | 7.00% |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax [Line Items] | ||||
Reclassification of stranded tax effects from accumulated other comprehensive loss to accumulated deficit | $ 16,200 | $ 0 | $ 16,191 | $ 0 |
Percentage of EBITDA limit set for U.S. interest expense deductions | 30.00% | |||
Percentage of EBIT limit set for U.S. interest expense deductions | 30.00% | |||
Expected tax refund | $ 13,700 | 13,700 | ||
Deferred payroll tax | 6,700 | |||
Deferred tax asset attributable to net operating loss carryforwards | 3,809,049 | 3,077,101 | ||
Deferred tax assets attributable to tax credit carryforwards | 22,440 | 13,135 | ||
Net operating loss carryforwards with expiration | 100,500 | |||
Net operating loss carryforwards without expiration | 8,500 | |||
Research and development credit carryforward | 1,100 | |||
Foreign tax credit carryforward | 21,300 | |||
Valuation allowance amount | 4,829,053 | 4,036,566 | ||
Gross unrecognized tax benefits | 51,402 | 24,954 | 29,144 | |
Unrecognized tax benefits that would impact effective tax rate | 47,600 | 21,500 | ||
Reserves for interest and penalties | 800 | 600 | ||
Tax Cuts and Jobs Act, Measurement Period Adjustment, Income Tax Expense (Benefit) | 8,800 | 11,800 | $ 1,000 | |
Future Benefit | ||||
Income Tax [Line Items] | ||||
Deferred tax assets attributable to tax credit carryforwards | $ 22,400 | $ 13,100 | ||
Intelsat Luxembourg | ||||
Income Tax [Line Items] | ||||
Enacted tax rate | 24.94% | 24.94% | 26.01% | |
Net operating loss carryforwards with expiration | $ 3,700,000 | |||
Tax Year 2035 | Intelsat Luxembourg | ||||
Income Tax [Line Items] | ||||
Net operating loss carryforwards with expiration | $ 1,300,000 |
Income Taxes - Summary of Total
Income Taxes - Summary of Total Income (Loss) Before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Provision For Income Taxes [Line Items] | |||
Loss before income taxes | $ (916,326) | $ (918,594) | $ (465,621) |
Domestic loss before income taxes | |||
Provision For Income Taxes [Line Items] | |||
Domestic loss before income taxes | (891,769) | (869,247) | (424,590) |
Foreign loss before income taxes | |||
Provision For Income Taxes [Line Items] | |||
Foreign loss before income taxes | $ (24,557) | $ (49,347) | $ (41,031) |
Income Taxes - Provision for (B
Income Taxes - Provision for (Benefit from) Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Current income tax provision (benefit): | |||
Domestic | $ 0 | $ 0 | $ 792 |
Foreign | (10,034) | 20,323 | 50,117 |
Total | (10,034) | 20,323 | 50,909 |
Deferred income tax provision (benefit): | |||
Domestic | 0 | 0 | 0 |
Foreign | 2,979 | (27,707) | 79,160 |
Total | 2,979 | (27,707) | 79,160 |
Total income tax provision (benefit): | $ (7,055) | $ (7,384) | $ 130,069 |
Income Taxes - Income Tax Provi
Income Taxes - Income Tax Provision (Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Expected tax provision (benefit) at Luxembourg statutory income tax rate | $ (228,532) | $ (229,097) | $ (121,108) |
Foreign income tax differential | 4,320 | (23,603) | 2,216 |
Luxembourg financing activities | 66,772 | (5,930) | 51,250 |
Change in tax rate | 0 | 163,831 | (684) |
Changes in unrecognized tax benefits | 8,595 | (4,178) | (2,205) |
Changes in valuation allowance | 792,487 | (166,683) | 746,905 |
Tax effect of 2011 intercompany sale | 0 | 1,269 | 1,655 |
Foreign tax credits | (8,754) | 0 | 138 |
State net operating loss modification | 21,764 | 0 | 0 |
2018 internal reorganization | 36,151 | 257,921 | (549,382) |
Impairment to intercompany investments in Luxembourg subsidiaries | (693,263) | 0 | 0 |
Net operating loss carryback | (6,227) | 0 | 0 |
Other | (368) | (914) | 1,284 |
Total income tax provision (benefit): | $ (7,055) | $ (7,384) | $ 130,069 |
Income Taxes - Net Deferred Tax
Income Taxes - Net Deferred Tax Balances (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Income Tax Disclosure [Abstract] | ||
Long-term deferred taxes, net | $ (61,345) | $ (55,171) |
Other assets | 21,485 | 21,417 |
Total net deferred tax liabilities | $ (39,860) | $ (33,754) |
Income Taxes - Components of Ne
Income Taxes - Components of Net Deferred Tax Liability (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax assets: | ||
Accruals and advances | $ 3,042 | $ 5,812 |
Amortizable intangible assets | 897,696 | 788,134 |
Non-amortizable intangible assets | 16,569 | 40,527 |
Customer deposits | 2,798 | 3,489 |
Bad debt reserve | 4,460 | 4,468 |
Disallowed interest expense carryforward | 76,797 | 109,229 |
Net operating loss carryforward | 3,809,049 | 3,077,101 |
Tax credits | 22,440 | 13,135 |
Tax basis differences in investments and affiliates | 56,850 | 99,396 |
Satellites and other property and equipment | 163,335 | 0 |
Capital loss carryforward | 5,999 | 0 |
Operating lease liabilities | 11,766 | 0 |
Other | 2,185 | 3,287 |
Total deferred tax assets | 5,072,986 | 4,144,578 |
Deferred tax liabilities: | ||
Satellites and other property and equipment | 0 | (51,392) |
Amortizable intangible assets | (5,384) | (7,299) |
Non-amortizable intangible assets | (31,774) | (31,407) |
Tax basis differences in investments and affiliates | (148,254) | (51,314) |
Operating lease ROU asset | (11,727) | 0 |
Basis difference in indebtedness | (86,297) | 0 |
Other | (357) | (354) |
Total deferred tax liabilities | (283,793) | (141,766) |
Valuation allowance | (4,829,053) | (4,036,566) |
Total net deferred tax liabilities | $ (39,860) | $ (33,754) |
Income Taxes - Summary of Activ
Income Taxes - Summary of Activity Related to Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
Beginning Balance | $ 24,954 | $ 29,144 |
Increases related to current year tax positions | 13,445 | 70 |
Increases related to prior year tax positions | 15,560 | 226 |
Decreases related to prior year tax positions | (23) | (432) |
Expiration of statute of limitations for the assessment of taxes | (2,534) | (4,054) |
Ending Balance | $ 51,402 | $ 24,954 |
Contractual Commitments - Addit
Contractual Commitments - Additional Expenditures and Expected Year of Payment (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Contractual Commitments [Line Items] | |
2021 | $ 1,338,318 |
2022 | 628,351 |
2023 | 297,043 |
2024 | 160,467 |
2025 | 159,040 |
2026 and thereafter | 557,017 |
Total contractual commitments | 3,140,236 |
Sublease Rental Income | |
2021 | (523) |
2021 | (260) |
2023 | (136) |
2024 | (67) |
2025 | (17) |
2026 and thereafter | (129) |
Total contractual commitments | (1,132) |
Satellite Construction and Launch Obligations | |
Contractual Commitments [Line Items] | |
2021 | 801,169 |
2022 | 425,693 |
2023 | 144,742 |
2024 | 15,133 |
2025 | 10,308 |
2026 and thereafter | 49,167 |
Total contractual commitments | 1,446,212 |
Gogo CA Satellite Commitments | |
Contractual Commitments [Line Items] | |
2021 | 104,968 |
2022 | 80,104 |
2023 | 61,573 |
2024 | 59,379 |
2025 | 59,914 |
2026 and thereafter | 199,515 |
Total contractual commitments | 565,453 |
Satellite Performance Incentive Obligations | |
Contractual Commitments [Line Items] | |
2021 | 72,411 |
2022 | 37,047 |
2023 | 25,594 |
2024 | 24,954 |
2025 | 23,154 |
2026 and thereafter | 80,961 |
Total contractual commitments | 264,121 |
Sublease Rental Income | |
Liabilities subject to compromise, contractual obligation | 4,300 |
Horizons-3 Satellite LLC Contribution and Purchase Obligations | |
Contractual Commitments [Line Items] | |
2021 | 29,849 |
2022 | 31,692 |
2023 | 32,551 |
2024 | 33,924 |
2025 | 39,023 |
2026 and thereafter | 154,105 |
Total contractual commitments | 321,144 |
Customer and Vendor Contracts | |
Contractual Commitments [Line Items] | |
2021 | 330,444 |
2022 | 54,075 |
2023 | 32,719 |
2024 | 27,144 |
2025 | 26,658 |
2026 and thereafter | 73,398 |
Total contractual commitments | $ 544,438 |
Contractual Commitments - Add_2
Contractual Commitments - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2020 | |
Contractual Commitments [Line Items] | ||
Contractual commitments | $ 3,140,236 | |
Total rental expense | $ 14,000 | |
Satellite Construction and Launch Obligations | ||
Contractual Commitments [Line Items] | ||
Contractual commitments | 1,446,212 | |
Satellite Performance Incentive Obligations | ||
Contractual Commitments [Line Items] | ||
Contractual commitments | 264,121 | |
Customer and Vendor Contracts | ||
Contractual Commitments [Line Items] | ||
Contractual commitments | 544,438 | |
Gogo CA Satellite Commitments | ||
Contractual Commitments [Line Items] | ||
Contractual commitments | $ 565,453 |
Contingencies (Details)
Contingencies (Details) $ in Billions | Jul. 14, 2020USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Possible loss contingency | $ 1.8 |
Third party claim to payments | 50.00% |
Related Party Transactions (Det
Related Party Transactions (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Horizons Satellite Holdings | |
Related Party Transaction [Line Items] | |
Ownership percentage | 50.00% |
Horizons-3 Satellite LLC | |
Related Party Transaction [Line Items] | |
Ownership percentage | 50.00% |
Condensed Combined Debtors' F_3
Condensed Combined Debtors' Financial Information - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Fresh-Start Adjustment [Line Items] | |||
Revenue | $ (1,913,080) | $ (2,061,465) | $ (2,161,190) |
Parent Company and Subsidiaries in Debtor-In-Possession Financing | |||
Fresh-Start Adjustment [Line Items] | |||
Revenue | (1,741,077) | ||
Parent Company and Subsidiaries in Debtor-In-Possession Financing | Intersegment Eliminations | |||
Fresh-Start Adjustment [Line Items] | |||
Revenue | $ 295,000 |
Condensed Combined Debtors' F_4
Condensed Combined Debtors' Financial Information - Debtors' Condensed Combined Balance Sheet (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 1,060,917 | $ 810,626 |
Restricted cash | 21,130 | 20,238 |
Receivables, net of allowances of $40,028 in 2019 and $40,785 in 2020 | 659,444 | 255,722 |
Contract assets | 39,774 | 47,721 |
Inventory | 147,094 | 430 |
Prepaid expenses and other current assets | 136,611 | 38,800 |
Total current assets | 2,064,970 | 1,173,537 |
Satellites and other property and equipment, net | 4,757,877 | 4,702,063 |
Goodwill | 2,698,247 | 2,620,627 |
Non-amortizable intangible assets | 2,295,000 | 2,452,900 |
Amortizable intangible assets, net | 290,569 | 276,752 |
Contract assets, net of current portion | 86,017 | 74,109 |
Other assets | 605,001 | 504,394 |
Total assets | 12,797,681 | 11,804,382 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 252,998 | 88,107 |
Taxes payable | 7,493 | 6,402 |
Employee related liabilities | 43,404 | 44,648 |
Accrued interest payable | 17,747 | 308,657 |
Current maturities of long-term debt | 5,903,724 | 0 |
Contract liabilities | 157,320 | 137,706 |
Deferred satellite performance incentives | 47,377 | 42,835 |
Other current liabilities | 73,479 | 62,446 |
Total current liabilities | 6,503,542 | 690,801 |
Contract liabilities, net of current portion | 1,447,891 | 1,113,450 |
Deferred satellite performance incentives, net of current portion | 138,116 | 175,837 |
Deferred income taxes | 61,345 | 55,171 |
Accrued retirement benefits, net of current portion | 129,837 | 125,511 |
Other long-term liabilities | 262,900 | 166,977 |
Liabilities subject to compromise | 10,168,518 | 0 |
Shareholders’ deficit: | ||
Common shares | 1,421 | 1,411 |
Paid-in capital | 2,573,840 | 2,565,696 |
Accumulated deficit | (8,416,410) | (7,503,830) |
Accumulated other comprehensive loss | (80,322) | (63,135) |
Total Intelsat S.A. shareholders’ deficit | (5,921,471) | (4,999,858) |
Total liabilities and shareholders’ deficit | 12,797,681 | $ 11,804,382 |
Parent Company and Subsidiaries in Debtor-In-Possession Financing | ||
Current assets: | ||
Cash and cash equivalents | 879,191 | |
Restricted cash | 20,817 | |
Receivables, net of allowances of $40,028 in 2019 and $40,785 in 2020 | 561,573 | |
Contract assets | 15,474 | |
Inventory | 1,347 | |
Prepaid expenses and other current assets | 100,021 | |
Intercompany receivables | 678,188 | |
Total current assets | 2,256,611 | |
Satellites and other property and equipment, net | 4,656,678 | |
Goodwill | 2,624,452 | |
Non-amortizable intangible assets | 2,295,000 | |
Amortizable intangible assets, net | 245,649 | |
Contract assets, net of current portion | 26,642 | |
Investment in affiliates | 150,029 | |
Other assets | 357,897 | |
Total assets | 12,612,958 | |
Current liabilities: | ||
Accounts payable and accrued liabilities | 222,876 | |
Taxes payable | 6,743 | |
Employee related liabilities | 36,563 | |
Accrued interest payable | 17,747 | |
Current maturities of long-term debt | 5,903,724 | |
Contract liabilities | 146,762 | |
Deferred satellite performance incentives | 47,377 | |
Other current liabilities | 43,885 | |
Total current liabilities | 6,425,677 | |
Contract liabilities, net of current portion | 1,422,893 | |
Deferred satellite performance incentives, net of current portion | 138,116 | |
Deferred income taxes | 61,069 | |
Accrued retirement benefits, net of current portion | 129,837 | |
Other long-term liabilities | 188,394 | |
Liabilities subject to compromise | 10,168,518 | |
Shareholders’ deficit: | ||
Common shares | 1,421 | |
Paid-in capital | 2,573,840 | |
Accumulated deficit | (8,416,410) | |
Accumulated other comprehensive loss | (80,397) | |
Total Intelsat S.A. shareholders’ deficit | (5,921,546) | |
Total liabilities and shareholders’ deficit | $ 12,612,958 |
Condensed Combined Debtors' F_5
Condensed Combined Debtors' Financial Information - Debtors' Condensed Combined Balance Sheet (Parenthetical) (Details) - USD ($) $ / shares in Units, $ in Thousands | Dec. 31, 2020 | May 20, 2020 | Dec. 31, 2019 |
Receivables, allowances | $ 40,785 | $ 40,028 | |
Common shares, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 |
Parent Company and Subsidiaries in Debtor-In-Possession Financing | |||
Receivables, allowances | $ 34,391 | ||
Common shares, par value (in dollars per share) | $ 0.01 |
Condensed Combined Debtors' F_6
Condensed Combined Debtors' Financial Information - Debtors' Condensed Combined Statements of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Jun. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenue | $ 1,913,080 | $ 2,061,465 | $ 2,161,190 | |
Operating expenses: | ||||
Direct costs of revenue (excluding depreciation and amortization) | 450,823 | 406,153 | 330,874 | |
Selling, general and administrative | 314,229 | 226,918 | 200,857 | |
Depreciation and amortization | 653,447 | 658,233 | 687,589 | |
Impairment of non-amortizable intangible and other assets | $ 34,000 | 191,943 | 0 | 0 |
Other operating expense—C-band | 33,642 | 0 | 0 | |
Total operating expenses | 1,644,084 | 1,672,869 | 1,219,320 | |
Income from operations | 268,996 | 388,596 | 941,870 | |
Interest expense, net | 813,603 | 1,273,112 | 1,212,374 | |
Other income, net | 14,142 | (34,078) | 4,541 | |
Reorganization items | (385,861) | 0 | 0 | |
Loss before income taxes | (916,326) | (918,594) | (465,621) | |
Benefit from income taxes | (7,055) | (7,384) | 130,069 | |
Net loss | (909,271) | $ (911,210) | $ (595,690) | |
Parent Company and Subsidiaries in Debtor-In-Possession Financing | ||||
Revenue | 1,741,077 | |||
Operating expenses: | ||||
Direct costs of revenue (excluding depreciation and amortization) | 267,158 | |||
Selling, general and administrative | 260,192 | |||
Cost from affiliates | 43,444 | |||
Depreciation and amortization | 629,519 | |||
Impairment of non-amortizable intangible and other assets | 191,943 | |||
Total operating expenses | 1,425,898 | |||
Income from operations | 315,179 | |||
Interest expense, net | 808,781 | |||
Equity in losses of affiliates | (58,165) | |||
Other income, net | 18,270 | |||
Reorganization items | (385,861) | |||
Loss before income taxes | (919,358) | |||
Benefit from income taxes | (7,694) | |||
Net loss | $ (911,664) |
Condensed Combined Debtors' F_7
Condensed Combined Debtors' Financial Information - Debtors' Condensed Combined Statements of Cash Flow (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||
Jun. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | |
Cash flows from operating activities: | ||||||
Net loss | $ (909,271) | $ (911,210) | $ (595,690) | |||
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||
Depreciation and amortization | 653,447 | 658,233 | 687,589 | |||
Provision for expected credit losses | 56,940 | 17,190 | (836) | |||
Foreign currency transaction loss | 4,255 | 2,128 | 6,736 | |||
Impairment of non-amortizable intangible and other assets | $ 34,000 | 191,943 | 0 | 0 | ||
Share-based compensation | 12,648 | 13,189 | 6,824 | |||
Deferred income taxes | 2,979 | (27,707) | 79,160 | |||
Amortization of discount, premium, issuance costs and related costs | 22,136 | 41,943 | 48,495 | |||
Non-cash reorganization items | 196,974 | 0 | 0 | |||
Debtor-in-possession financing fees | 59,682 | 0 | 0 | |||
Amortization of actuarial loss (gain) and prior service credits for retirement benefits | 2,635 | (3,572) | 3,823 | |||
Unrealized losses on derivative financial instruments | 372 | 27,018 | (15,093) | |||
Unrealized gains on investments and loans held-for-investment | (3,041) | 39,695 | 408 | |||
Other non-cash items | 729 | (205) | 1,178 | |||
Changes in operating assets and liabilities: | ||||||
Receivables | (15,835) | (1,307) | (63,814) | |||
Prepaid expenses, contract and other assets | (137) | 15,664 | 3,708 | |||
Accounts payable and accrued liabilities | 79,337 | 10,908 | 7,291 | |||
Accrued interest payable | 52,623 | 24,008 | 21,442 | |||
Contract liabilities | (63,242) | (18,368) | (39,763) | |||
Accrued retirement benefits | (15,857) | (8,224) | (15,902) | |||
Other long-term liabilities | 656 | (12,875) | 8,913 | |||
Net cash provided by operating activities | 331,302 | 255,539 | 344,173 | |||
Cash flows from investing activities: | ||||||
Capital expenditures (including capitalized interest) | (606,759) | (229,818) | (255,696) | |||
Proceeds from principal repayments on loans held-for-investment | 973 | 0 | 0 | |||
Other proceeds from satellites | 5,625 | 13,125 | 18,750 | |||
Net cash used in investing activities | (976,506) | (292,733) | (283,634) | |||
Cash flows from financing activities: | ||||||
Proceeds from debtor-in-possession financing | 1,000,000 | 0 | 0 | |||
Debtor-in-possession financing fees | (59,682) | 0 | 0 | |||
Net cash provided by (used in) financing activities | 905,087 | 362,910 | (90,323) | |||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (3,200) | (2,009) | (4,450) | |||
Net change in cash, cash equivalents and restricted cash | 256,683 | 323,707 | (34,234) | |||
Cash, cash equivalents, and restricted cash, beginning of period | 830,864 | 507,157 | 541,391 | |||
Cash, cash equivalents, and restricted cash, end of period | 1,087,547 | 830,864 | 507,157 | |||
Reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated Debtors' balance sheet to the total sum of these same amounts shown on the condensed consolidated Debtors' statement of cash flows: | ||||||
Cash and cash equivalents | $ 1,060,917 | $ 810,626 | ||||
Restricted cash | 21,130 | 20,238 | ||||
Cash, cash equivalents and restricted cash | 1,087,547 | 830,864 | $ 507,157 | 1,087,547 | 830,864 | |
Parent Company and Subsidiaries in Debtor-In-Possession Financing | ||||||
Cash flows from operating activities: | ||||||
Net loss | (911,664) | |||||
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||
Depreciation and amortization | 629,519 | |||||
Provision for expected credit losses | 51,914 | |||||
Foreign currency transaction loss | (924) | |||||
Impairment of non-amortizable intangible and other assets | 191,943 | |||||
Share-based compensation | 10,425 | |||||
Deferred income taxes | 2,876 | |||||
Amortization of discount, premium, issuance costs and related costs | 22,136 | |||||
Non-cash reorganization items | 196,974 | |||||
Debtor-in-possession financing fees | 59,682 | |||||
Amortization of actuarial loss (gain) and prior service credits for retirement benefits | 2,635 | |||||
Unrealized losses on derivative financial instruments | 372 | |||||
Unrealized gains on investments and loans held-for-investment | (5,433) | |||||
Equity in losses of affiliates | 58,165 | |||||
Other non-cash items | (73) | |||||
Changes in operating assets and liabilities: | ||||||
Receivables | (14,888) | |||||
Intercompany receivables | (144,220) | |||||
Prepaid expenses, contract and other assets | (21,858) | |||||
Accounts payable and accrued liabilities | 129,986 | |||||
Accrued interest payable | 52,623 | |||||
Contract liabilities | (70,143) | |||||
Accrued retirement benefits | (15,857) | |||||
Other long-term liabilities | 5,848 | |||||
Net cash provided by operating activities | 230,038 | |||||
Cash flows from investing activities: | ||||||
Capital expenditures (including capitalized interest) | (599,283) | |||||
Dividends from affiliates | 30,401 | |||||
Proceeds from principal repayments on loans held-for-investment | 973 | |||||
Capital contribution to affiliates | (9,005) | |||||
Acquisition of loan to affiliate | (426,376) | |||||
Other proceeds from satellites | 5,625 | |||||
Net cash used in investing activities | (997,665) | |||||
Cash flows from financing activities: | ||||||
Proceeds from debtor-in-possession financing | 1,000,000 | |||||
Debtor-in-possession financing fees | (59,682) | |||||
Principal payments on deferred satellite performance incentives | (28,831) | |||||
Net cash provided by (used in) financing activities | 911,487 | |||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 835 | |||||
Net change in cash, cash equivalents and restricted cash | 144,695 | |||||
Cash, cash equivalents, and restricted cash, beginning of period | 755,313 | |||||
Cash, cash equivalents, and restricted cash, end of period | 900,008 | 755,313 | ||||
Reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated Debtors' balance sheet to the total sum of these same amounts shown on the condensed consolidated Debtors' statement of cash flows: | ||||||
Cash and cash equivalents | 879,191 | |||||
Restricted cash | 20,817 | |||||
Cash, cash equivalents and restricted cash | $ 900,008 | $ 755,313 | $ 900,008 | $ 755,313 |
Schedule II - Valuation and Qua
Schedule II - Valuation and Qualifying Accounts (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Accounts Receivable | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items] | |
Balance at January 1, 2020 | $ 40,028 |
Cumulative-effect adjustment of ASU 2016-13 adoption | 0 |
Business combination adjustments | 2,616 |
Charged to costs and expenses | 54,783 |
Deductions | (56,642) |
Balance at December 31, 2020 | 40,785 |
Contract Assets | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items] | |
Balance at January 1, 2020 | 0 |
Cumulative-effect adjustment of ASU 2016-13 adoption | 916 |
Business combination adjustments | 816 |
Charged to costs and expenses | 2,157 |
Deductions | 0 |
Balance at December 31, 2020 | $ 3,889 |