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FOR IMMEDIATE RELEASE

Hughes Communications, Inc. Announces Second Quarter 2007 Results
Revenues Increase 12% over Second Quarter 2006 to $234 Million;
EBITDA More than Doubles to $31 Million;
Net Income Increases to $10 Million and Earnings per Share to $0.50
Germantown, Md., August 10, 2007—Hughes Communications, Inc. (NASDAQ: HUGH) (“Hughes”), the
global leader in broadband satellite network solutions and services, today announced financial results for the
second quarter ended June 30, 2007. Hughes' consolidated operations are classified into three reportable
segments: VSAT; Telecom Systems; and Parent and Other. The VSAT and Telecom Systems segments
represent all the operations of Hughes Network Systems, LLC (“HNS”), Hughes’ principal operating
subsidiary. The Parent and Other segment includes the financial results of Hughes Corporate, Electronic
System Products, Inc., and investments in the other companies that were contributed from SkyTerra
Communications, Inc. (“SkyTerra”), Hughes' predecessor, prior to the Skyterra/Hughes spin-off in February
2006.
Hughes Network Systems, LLC (HNS)
“HNS once again delivered strong all-round financial performance in the second quarter of 2007, setting new
records for second quarter revenue, operating income, EBITDA, and net income,” said Pradman Kaul,
president and chief executive officer. “Revenues increased by 12% over the second quarter of 2006 to $234
million and operating income increased by 449% to a strong $20 million from $4 million. EBITDA more
than doubled to $32 million, and net income increased to $11 million compared to a loss of $4 million in the
second quarter of 2006. Adjusted EBITDA also increased by 12% to $32 million in the second quarter of
2007.
“The consumer/SMB and mobile satellite businesses continued to be the key contributors to our revenue
growth,” said Kaul. “Over 30,000 new subscribers were activated in the second quarter of 2007, resulting in
the consumer/SMB subscriber base growing to 353,000 at June 30, 2007 for a growth of 18% over the
subscriber base at June 30, 2006. Revenue from our mobile satellite business showed strong growth of 88%
to $35 million in the second quarter of 2007 over the second quarter of 2006. Our North American and
International enterprise businesses continued their steady revenue contribution with combined growth of 3%
over the second quarter of 2006.”
Kaul continued, “We booked new orders of $219 million in the second quarter of 2007 including significant
orders from Barrett Xplore, Foot Locker, Yum Brands, Kmart, Shell Oil, Weis Markets, Jiffy Lube and
T.J.Maxx in our North America enterprise business. In our International enterprise business, we were
awarded significant orders by World Bank, Micro Tech, Telmex and BP. The Mobile Satellite business was
awarded major orders by TerreStar, ICO, and Thuraya.”
“For the six months ended June 30, 2007, HNS revenue grew by 13% to $457 million, EBITDA by 88% to
$57 million, Adjusted EBITDA by 27% to $59 million, and net income to $15 million compared to a loss of
$4 million in the same period in 2006. New orders for all segments were robust. Total new orders for the first
six months of 2007 were $496 million, a growth of 28% over the same period in 2006.”

1

Set forth below is a table highlighting certain of HNS' results for the three- and six-month periods ended June
30, 2007 and 2006:

Hughes Network Systems, LLC
Three Months
Ended June 30,
2007
2006

(Dollars in thousands)
Revenue
VSAT
Telecom Systems
Total
Operating income (loss)
VSAT
Telecom Systems
Total

$
$

$

15,399
4,844
20,243

Net income (loss)

$

EBITDA*
Adjusted EBITDA*

*

$

196,696
37,413
234,109

$
$

183,856
24,647
208,503

$
$

(1,778)
5,466
3,688

11,178

$

$

31,921

$

31,981

Six Months
Ended June 30,
2007

$
$

$

391,757
65,083
456,840

2006

$
$

$

365,164
40,131
405,295

$

24,858
8,385
33,243

$

5,454
7,217
12,671

(4,428)

$

15,486

$

(4,234)

$

14,256

$

57,335

$

30,519

$

28,526

$

58,572

$

46,244

For the definitions of EBITDA and Adjusted EBITDA, see “Reconciliation of
Non-GAAP Financial Measures to GAAP Financial Measures” below.

Selected Highlights
•

The SPACEWAY™ 3 satellite arrived at the Arianespace launch facility in Kourou, French Guiana,
where the Ariane 5 heavy launcher will launch the satellite into geosynchronous transfer orbit. The
scheduled launch date is August 14, 2007. The SPACEWAY 3 satellite will operate in the globally
assigned Ka-band spectrum and will be used to provide a new range of satellite broadband services
to enterprise, consumer, and government customers throughout North America.

•

HNS announced a breakthrough in broadband network management—a fully integrated, enterprisewide performance and fault management tool for both satellite and landline (DSL, T1) broadband
technologies—the HughesNet® Customer Gateway. Available exclusively to HughesNet Managed
Services customers, the HughesNet Customer Gateway offers a single interface for monitoring and
managing any broadband technology deployed within an organization.

•

Frost and Sullivan awarded HNS the North American Vertical Market Penetration Leadership Award
for managed network services for the retail sector. This award recognizes HNS for its ability to
provide solutions and support that meet customers' specific infrastructure management needs.

•

HNS is a member of Sprint's winning team for the recently awarded U.S. General Services
Administration (GSA) Networx Enterprise contract. HNS will provide managed network access and
Internet services via broadband satellite as a subcontractor in support of federal mission-critical
telecommunications requirements.

•

HNS announced the general availability in Europe of HughesNet Managed Network Services. This
suite of fully-managed virtual private network (VPN) solutions for multi-site enterprise networks
offers customers the choice of broadband access technologies at each site, whether DSL, satellite,
private line, or in a combination.
2

•

For the seventh consecutive year, HNS has been awarded the Workplace Excellence Seal of
Approval from the Alliance for Workplace Excellence. In addition to the Workplace Excellence
award, the company was also given the Wellness Trailblazer award. Both awards are given to
members of the Maryland business community dedicated to establishing a workplace culture that
allows employees to achieve success at work, at home, and in the community.

•

On August 8, 2007, Hughes Communications, Inc. filed a shelf registration statement on Form S-3 to
register equity and debt securities of Hughes Communications, Inc. and debt securities of Hughes
Network Systems, LLC, and HNS Finance, its wholly owned subsidiary, as co-issuers, with the SEC.
Any proceeds received from the sale of these securities will be used for capital expenditures,
acquisitions, working capital and other general corporate purposes.

Hughes Communications, Inc. (Hughes)
Certain financial information for Hughes for the three- and six- months ended June 30, 2007 and 2006 is
shown below.

Hughes Communications, Inc.
Three Months
Ended June 30,
2007
2006

(Dollars in thousands)
Revenue
VSAT
Telecom Systems
Parent and Other
Total
Operating income (loss)
VSAT
Telecom Systems
Parent and Other
Total

$

$

$

196,696
37,413
249
234,358

$

$

$

$

15,399
4,844
(1,210)
19,033

Net income (loss)

$

EBITDA*

$

183,856
24,647
158
208,661

Six Months
Ended June 30,
2007

$

$

$

$

(1,778)
5,466
(310)
3,378

9,632

$

30,766

$

391,757
65,083
400
457,240

2006

$

$

365,164
40,131
240
405,535

$

$

24,858
8,385
(2,654)
30,589

$

5,454
7,217
(2,534)
10,137

(4,396)

$

12,572

$

(59,940)

14,447

$

55,146

$

28,313

* For the definition of EBITDA, see “Reconciliation of Non-GAAP Financial
Measures to GAAP Financial Measures” below.
The net loss for the six months ended June 30, 2006 includes a tax charge of approximately $51.3 million recorded in
the first quarter of 2006, primarily related to the SkyTerra/Hughes spin-off. As Hughes is the accounting successor to
SkyTerra, the taxes associated with the separation are included in Hughes' results for the quarter ended March 31, 2006
and a portion of the deferred tax assets were utilized to satisfy the tax expense resulting from the taxable gain.
Accordingly, Hughes does not expect this expense to have an impact on its cash from operations.

3

To summarize, Kaul said, “We are very pleased that we have once again delivered strong financial results in
the second quarter of 2007 after an equally strong first quarter. This performance, combined with a strong
order backlog, has positioned us well for revenue growth. I am also delighted to inform you that our
SPACEWAY 3 satellite is at the launch site in French Guiana awaiting its launch on August 14, 2007. We
are looking forward to a successful launch and to commencing HughesNet commercial service using
SPACEWAY 3 approximately six months thereafter. We expect that SPACEWAY 3 will substantially
reduce our costs and open up new revenue opportunities going forward in the enterprise and consumer/SMB
markets.”
Commenting on the financial performance, Grant Barber, executive vice president and chief financial officer
said, “Our revenue and profitability showed strong growth in all operating segments in the second quarter of
2007 over the same period in 2006, and is reflected in the earnings per share for Hughes of $0.50 on a fully
diluted basis compared to a loss of $0.23 in the same period in 2006. For the six-month period ended June
30, 2007, Hughes delivered earnings per share of $0.65 compared to a loss of $4.24 per share in the same
period in 2006. We generated cash from operations of $33 million during the six months ended June 30,
2007 compared to $15 million in the six months ended June 30, 2006, and we closed the second quarter of
2007 with a healthy consolidated cash and marketable securities position of $221 million.”
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures
The following table reconciles the differences between HNS' net income as determined under United States
of America generally accepted accounting principles (GAAP), EBITDA and Adjusted EBITDA.
Hughes Network Systems, LLC
Three Months
Ended June 30,
2007
2006

(Dollars in thousands)
Net income (loss)
Add:
Interest expense
Income tax (benefit) expense
Depreciation and amortization
Equity incentive plan compensation
Less:
Interest income
EBITDA
Add:
Inventory provision related to shift to Broadband focus
HughesNet branding costs
Restructuring charge
Benefits/insurance programs sponsored by DIRECTV
Legal settlement and related fees - pre-April 2005 Acquisition
Management fee to Hughes Communications, Inc.
Adjusted EBITDA

$

11,178

$

11,870
(131)
10,981
767

$

(2,744)
31,921

$

60
31,981

4

(4,428)

Six Months
Ended June 30,
2007
2006
$

10,346
500
10,086
93

$

(2,341)
14,256

$

11,879
902
653
586
250
28,526

15,486

$

23,308
389
22,524
1,294

$

(5,666)
57,335

$

1,237
58,572

(4,234)
19,740
987
17,216
152

$

(3,342)
30,519

$

11,879
1,454
1,306
586
500
46,244

The following table reconciles the differences between Hughes’ net income as determined under GAAP and
EBITDA:

Hughes Communications, Inc.
Three Months
Ended June 30,
2007
2006

(Dollars in thousands)
Net income (loss)
Add:
Interest expense
Income tax expense
Depreciation and amortization
Equity incentive plan compensation
Less:
Interest income
EBITDA

$

9,632

$

11,872
164
10,981
1,005

$

(2,888)
30,766

(4,396)

Six Months
Ended June 30,
2007
$

10,388
500
10,086
467

$

(2,598)
14,447

12,572

2006
$

23,310
684
22,524
2,022

$

(5,966)
55,146

(59,940)
21,489
51,821
17,216
1,510

$

(3,783)
28,313

The financial statements of Hughes and HNS for the three- and six-month periods ended June 30, 2007 and
2006 are attached to this press release.
Note:
EBITDA is defined as earnings (loss) before interest, income taxes, depreciation, amortization and equity
incentive plan compensation. Adjusted EBITDA is used in calculating covenant compliance under HNS'
credit agreements and the indenture governing HNS’ 9½% Senior Notes due 2014. Adjusted EBITDA is
defined as EBITDA further adjusted to exclude certain adjustments. EBITDA and Adjusted EBITDA are not
recognized terms under GAAP. EBITDA and Adjusted EBITDA do not represent net income or cash flows
from operations, as these terms are defined under GAAP, and should not be considered as alternatives to net
income as an indicator of operating performance or to cash flows as a measure of liquidity. Additionally,
EBITDA and Adjusted EBITDA are not intended to be measures of cash flow available to management for
discretionary use, as such measures do not consider certain cash requirements such as capital expenditures
(including expenditures on VSAT operating lease hardware and capitalized software development costs), tax
payments, and debt service requirements (including VSAT operating lease hardware). EBITDA and Adjusted
EBITDA as presented herein are not necessarily comparable to similarly titled measures reported by other
companies. EBITDA and Adjusted EBITDA are presented herein because HNS and Hughes use such
information in their review of the performance of management and in the performance of their business. In
addition, information concerning Adjusted EBITDA is being presented because it reflects important
components included in the financial covenants under the senior note indenture and HNS' credit agreements.
About Hughes Communications, Inc.
Hughes Communications, Inc. (NASDAQ: HUGH) is the 100 percent owner of Hughes Network Systems,
LLC. Hughes is the global leader in providing broadband satellite networks and services for enterprises,
governments, small businesses, and consumers. HughesNet encompasses all broadband solutions and
managed services from Hughes, bridging the best of satellite and terrestrial technologies. Its broadband
satellite products are based on the IPoS (IP over Satellite) global standard, approved by the TIA, ETSI, and
ITU standards organizations. To date, Hughes has shipped more than 1.2 million systems to customers in
over 100 countries.

Headquartered outside Washington, D.C., in Germantown, Maryland, USA, Hughes maintains sales and
support offices worldwide. For more information, please visit www.hughes.com.

5

Safe Harbor Statement under the U.S. Private Securities Litigation Reform Act of 1995
This press release may contain statements that are forward looking, as that term is defined by the Private Securities
Litigation Reform Act of 1995. These statements include, but are not limited to, discussions regarding industry outlook
and Hughes’ expectations regarding the performance of its business, its future liquidity and capital resource needs, its
strategic plans and objectives and the ability to launch and deploy SPACEWAY 3. These forward-looking statements
are based on management's beliefs, as well as assumptions made by, and information currently available to,
management. When used in this release, the words “believe,” “anticipate,” “estimate,” “expect,” “intend,” “project,”
“plans” and similar expressions and the use of future dates are intended to identify forward-looking statements.
Although management believes that the expectations reflected in these forward-looking statements are reasonable, it can
give no assurance that these expectations will prove to have been correct. You are cautioned not to place undue reliance
on any forward-looking statements, which speak only as of the date made. These statements are subject to certain risks,
uncertainties and assumptions, including, but not limited to, the following: risks related to Hughes’ substantial leverage
and restrictions contained in its debt agreements, technological developments, its reliance on providers of satellite
transponder capacity, changes in demand for Hughes’ services and products, competition, industry trends, regulatory
changes, foreign currency exchange rate fluctuations and other risks identified and discussed under the caption “Risk
Factors” in Hughes’ Annual Report on Form 10-K for the year ended December 31, 2006 filed with the Securities and
Exchange Commission on March 26, 2007 and in the other documents Hughes files with the Securities and Exchange
Commission from time to time.

###
©Hughes Communications, Inc. All rights reserved. Hughes, HughesNet, IPoS, and SPACEWAY are trademarks of Hughes
Network Systems, LLC. DIRECTV and DIRECWAY are registered trademarks of The DIRECTV Group, Inc.

Contact Information

Attachments

Investor Relations Contact: Deepak V. Dutt,
Vice President, Treasurer and Investor Relations Officer
Email: ddutt@hns.com
Phone: 301-428-7010

Hughes Communications, Inc.
Condensed Consolidated Balance Sheets
Condensed Consolidated Statements of Operations
Condensed Consolidated Statements of Cash Flows

Media Contact: Judy Blake,
Director, Marketing Communications
Email: jblake@hns.com
Phone: 301-601-7330

Hughes Network Systems, LLC
Condensed Consolidated Balance Sheets
Condensed Consolidated Statements of Operations
Condensed Consolidated Statements of Cash Flows

6

HUGHES COMMUNICATIONS, INC.
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
June 30,
2007

December 31,
2006

ASSETS
Current assets:
Cash and cash equivalents
Marketable securities
Receivables, net
Inventories
Prepaid expenses and other
Total current assets
Property, net
Capitalized software costs, net
Intangible assets, net
Other assets
Total assets

$

$

175,972
44,891
181,946
61,104
45,234
509,147
378,760
44,780
27,592
107,999
1,068,278

$

$

106,933
107,320
180,955
61,280
39,947
496,435
312,497
41,159
30,663
50,890
931,644

LIABILITIES AND STOCKHOLDER'S EQUITY
Current liabilities:
Accounts payable
Short-term borrowings and current portion of long-term debt
Accrued liabilities
Due to affiliates
Total current liabilities
Long-term debt
Other long-term liabilities
Total liabilities

$

67,861
21,545
143,326
9,437
242,169
578,174
9,660
830,003

$

59,391
27,210
124,586
13,119
224,306
469,190
18,079
711,575

Commitments and contingencies
Minority interests
Stockholders' Equity:
Preferred stock, $0.001 par value; 1,000,000 shares authorized and no
shares issued and outstanding at June 30, 2007 and December 31, 2006
Common stock, $0.001 par value; 64,000,000 shares authorized;
19,135,572 shares and 19,000,622 shares issued and outstanding
as of June 30, 2007 and December 31, 2006, respectively
Additional paid in capital
Accumulated deficit
Accumulated other comprehensive income (loss)
Total stockholders' equity
Total liabilities and stockholders' equity

4,680

-

-

19
629,062
(397,836)
2,509
233,754
$

7

4,521

1,068,278

19
626,927
(410,408)
(1,149)
215,389
$

931,644

HUGHES COMMUNICATIONS, INC.
Condensed Consolidated Statements of Operations
(In thousands, except share and per share amounts)
(Unaudited)
Three Months Ended

Six Months Ended

June 30,
2007

Revenues:
Services
Hardware sales
Total revenues
Operating costs and expenses:
Cost of services
Cost of hardware products sold
Selling, general and administrative
Research and development
Amortization of intangibles
Total operating costs and expenses
Operating income
Other (expense) income :
Interest expense
Interest income
Other income, net
Income (loss) before income taxes expense; minority
interests in net (earnings) losses of subsidiaries; equity in losses
of unconsolidated affiliates; and discontinued operations
Income tax expense
Minority interests in net (earnings) losses of subsidiaries
Equity in losses of unconsolidated affiliates
Income (loss) from continuing operations
Discontinued operations:
Loss from discontinued operations
Gain on sale of discontinued operations
Net income (loss)
Cumulative dividends and accretion of convertible preferred stock
to liquidation value
Net income (loss) attributable to common stockholders

$

$

Basic net earnings (loss) per common share:
Continuing operations
Discontinued operations
Basic net earnings (loss) per common share

$
$

Diluted net earnings (loss) per common share:
Continuing operations
Discontinued operations
Diluted net earnings (loss) per common share

$
$

June 30,
2006

129,373
104,985
234,358

$

2007

107,726
100,935
208,661

$

2006

249,147
208,093
457,240

$

213,042
192,493
405,535

86,940
85,352
37,280
4,218
1,535
215,325
19,033

75,071
89,159
33,546
6,309
1,198
205,283
3,378

167,174
172,518
75,546
8,342
3,071
426,651
30,589

147,353
163,018
68,516
14,246
2,265
395,398
10,137

(11,872)
2,888
39

(10,388)
2,598
756

(23,310)
5,966
140

(21,489)
3,783
756

10,088
(164)
(125)
(167)
9,632

(3,656)
(500)
(122)
(118)
(4,396)

13,385
(684)
158
(287)
12,572

(6,813)
(51,821)
249
(1,753)
(60,138)

9,632

(4,396)

12,572

(42)
240
(59,940)

9,632
0.51
0.51
0.50
0.50

$
$
$
$
$

(4,396)
(0.23)
(0.23)
(0.23)
(0.23)

$
$
$
$
$

12,572
0.67
0.67
0.65
0.65

$
$
$
$
$

(1,454)
(61,394)
(4.25)
0.01
(4.24)
(4.25)
0.01
(4.24)

Basic weighted average common shares outstanding

18,862,337

18,795,289

18,852,783

14,483,198

Diluted weighted average common shares outstanding

19,209,312

18,795,289

19,212,199

14,483,198

8

HUGHES COMMUNICATIONS, INC.
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Six Months Ended
June 30,
2007
2006

Cash flows from operating activities:
Net income (loss)
Adjustments to reconcile net income (loss) to cash flows from
operating activities:
Loss on discontinued operations
Depreciation and amortization
Equity plan compensation expense
Minority interests
Equity in losses from unconsolidated affiliates
Gain on disposal of assets
Deferred income taxes
Change in other operating assets and liabilities, net of acquisitions:
Receivables, net
Inventories
Prepaid expenses and other
Accounts payable
Accrued liabilities and other
Net cash provided by continuing operations
Net cash used in discontinued operations
Net cash provided by operating activities
Cash flows from investing activities:
Change in restricted cash
Sale (purchases) of marketable investments, net
Expenditures for property
Expenditures for capitalized software
Proceeds from sale of property
Acquisitions/divestitures, net of cash received
Other, net
Net cash used in investing activities
Cash flows from financing activities:
Net increase (decrease) in notes and loans payable
Debt borrowings from Apollo
Debt repayments to Apollo
Proceeds from rights offering
Distribution to SkyTerra
Payment of dividends on preferred stock
Proceeds from exercise of stock options and warrants
Long-term debt borrowings
Repayment of long-term debt
Debt issuance costs
Net cash provided by financing activities
Effect of exchange rate changes on cash and cash equivalents
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of the period
Cash and cash equivalents at end of the period
Supplemental cash flow information:
Cash paid for interest
Cash paid for income taxes
Supplemental disclosure of non-cash financing activities:
Net liability distributed to SkyTerra, net of cash

9

$

12,572

$

(59,940)

22,767
2,022
(158)
287
(285)
(705)

42
17,564
1,510
(193)
1,806
(222)
48,347

1,988
817
(5,401)
9,148
(10,478)
32,574
32,574

26,412
17,241
1,081
(16,878)
(21,711)
15,059
(9)
15,050

406
62,514
(119,383)
(6,949)
716
(62,696)

(506)
(44,091)
(37,950)
(8,768)
155
12,870
(54)
(78,344)

$

358
113
115,662
(13,226)
(2,044)
100,863
(1,702)
69,039
106,933
175,972

$

(1,261)
100,000
(100,000)
100,000
(8,911)
(1,394)
1,966
453,944
(341,603)
(11,136)
191,605
107
128,418
21,964
150,382

$
$

26,005
2,173

$
$

16,215
3,213

$

-

$

48,113

HUGHES NETWORK SYSTEMS
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
June 30,
2007

December 31,
2006

ASSETS
Current assets:
Cash and cash equivalents
Marketable securities
Receivables, net
Inventories
Prepaid expenses and other
Total current assets

$

Property, net
Capitalized software costs, net
Intangible assets, net
Other assets
Total assets

$

171,521
38,196
181,668
61,104
44,049
496,538
378,760
44,780
27,592
93,714
1,041,384

$

$

99,098
103,466
180,694
61,280
39,175
483,713
312,497
41,159
30,663
44,358
912,390

LIABILITIES AND EQUITY
Current liabilities:
Accounts payable
Short-term borrowings and current portion of long-term debt
Accrued liabilities
Due to affiliates
Total current liabilities

$

Long-term debt
Other long-term liabilities
Total liabilities

66,682
21,545
142,013
9,933
240,173

$

57,781
27,210
123,576
13,592
222,159

578,174
953
819,300

469,190
18,079
709,428

4,476

4,659

Commitments and contingencies
Minority interests
Equity:
Class A membership interests
Class B membership interests
Retained earnings
Accumulated other comprehensive income (loss)
Total equity

180,506
34,588
2,514
217,608

Total liabilities and equity

$

10

1,041,384

180,346
19,102
(1,145)
198,303
$

912,390

HUGHES NETWORK SYSTEMS
Condensed Consolidated Statements of Operations
(In thousands)
(Unaudited)
Three Months Ended
June 30,
2007

Revenues:
Services
Hardware sales
Total revenues

$

Operating costs and expenses:
Cost of services
Cost of hardware products sold
Selling, general and administrative
Research and development
Amortization of intangibles
Total operating costs and expenses
Operating income
Other income (expense):
Interest expense
Interest income
Other income, net
Income before income tax benefit (expense), minority interests in net
(earnings) losses of subsidiaries and equity in earnings of
unconsolidated affiliates
Income tax benefit (expense)
Minority interests in net (earnings) losses of subsidiaries
Equity in earnings of unconsolidated affiliates

2006

129,124
104,985
234,109

$

$

11

107,568
100,935
208,503

$

248,747
208,093
456,840

$

212,802
192,493
405,295

86,926
85,352
35,835
4,218
1,535
213,866

75,060
89,159
33,089
6,309
1,198
204,815

167,132
172,518
72,534
8,342
3,071
423,597

147,324
163,018
65,771
14,246
2,265
392,624

20,243

3,688

33,243

12,671

(11,870)
2,744
39

(10,346)
2,341
475

(23,308)
5,666
91

(19,740)
3,342
480

11,156

(3,842)

15,692

(3,247)

131

(500)

(389)

(987)

(109)

(122)

183

(54)

-

Net income (loss)

Six Months Ended
June 30,
2007
2006

11,178

36
$

(4,428)

$

15,486

54
$

(4,234)

HUGHES NETWORK SYSTEMS
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Six Months Ended
June 30,
2007
2006

Cash flows from operating activities:
Net income (loss)
Adjustments to reconcile net income to cash flows
from operating activities:
Depreciation and amortization
Equity plan compensation expense
Minority interests
Gain on disposal of assets
Change in other operating assets and liabilities, excluding the
effect of the HCI Transaction:
Receivables, net
Inventories
Prepaid expenses and other
Accounts payable
Accrued liabilities and other
Net cash provided by operating activities
Cash flows from investing activities:
Change in restricted cash
Sale (purchase) of marketable investments, net
Expenditures for property
Expenditures for capitalized software
Proceeds from sale of property
Other, net
Net cash used in investing activities
Cash flows from financing activities:
Net increase (decrease) in notes and loans payable
Long-term debt borrowings
Repayment of long-term debt
Debt issuance costs
Net cash provided by financing activities
Effect of exchange rate changes on cash and cash equivalents
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of the period
Cash and cash equivalents at end of the period
Supplemental cash flow information:
Cash paid for interest
Cash paid for income taxes
Supplemental non-cash disclosure due to acquisition by
Hughes Communications, Inc.:
Increase in assets
Increase in liabilities
Increase in net assets

12

$

15,486

$

(4,234)

22,767
160
(183)
(285)

17,564
152
-

2,004
817
(6,654)
9,579
(10,755)
32,936

26,640
17,241
1,590
(16,115)
(21,374)
21,464

406
65,649
(119,383)
(6,949)
716
(59,561)

(506)
(46,594)
(37,950)
(8,768)
155
54
(93,609)

$

358
115,662
(13,226)
(2,044)
100,750
(1,702)
72,423
99,098
171,521

$

(1,261)
453,944
(341,602)
(11,136)
99,945
104
27,904
113,267
141,171

$
$

26,003
2,172

$
$

14,465
1,412

$

51,471
40,118
11,353

$



---

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