Sure, there’s still the challenges of a delay in rolling out the 5G network upgrade and some expense associated with the legacy network refresh. But Gogo‘s Board of Directors is satisfied that the company has sufficient liquidity to handle those events, as well as other ongoing operations. The inflight connectivity company authorized share buy-backs up to $50 million as part of its commitment to return equity to shareholders.
With a strong cash balance, our Gogo 5G, Galileo and other strategic projects well-funded, our net leverage ratio at 3.0x, and with strong confidence in our business, we are now comfortable moving to priority four and returning capital to shareholders.
– Oakleigh Thorne, chairman and CEO
The company reported cash and cash equivalents just shy of $100 million as of 30 June 2023, part of $745 million in total assets. The company’s remaining expenses related to its Gogo 5G rollout are relatively low, and deferred a year owing to the latest chip issues. Costs for the legacy network refresh will be borne in part by the US government, part of a reimbursement program from the FCC to remove Chinese communications gear from the telecommunications network. Currently only 39% of that expense will be covered, however. The remaining costs will either be borne by the company or covered through an additional allocation by Congress.
Wall Street cheered the news, with shares closing up nearly 10% the day after the announcement.
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