I need two ratios provided based on the financial statement of a company (fullfinancial attached).

I need the price-earnings ratio (the formula of price per share divided by earnings per share)

and theprice-to-book ratio (formula is the price per share divided by book value share)

\fA LETTER TO SHAREHOLDERS from Mark Dankberg 1 DEAR SHAREHOLDERS, ViaSat's transformation into a services-led company is well underway, and our results tell the story. In fiscal year 2015 we set new records for revenue and Adjusted EBITDA. Our satellite services segment is driving growing cash profitability and improving margin, accounting for more than a third of revenues and over half of Adjusted EBITDA in the fiscal year. Since fiscal year 2010 our revenues have more than doubled while Adjusted EBITDA has tripled, and since 2004 Adjusted EBITDA has grown by a compounded annual growth rate of better than 20%. Our growing profitability is attributable to the bandwidth economics performance of the ViaSat-1 system we launched in the last quarter of 2011. About 80% of our $500 million in fiscal 2015 satellite services revenue came from services delivered over ViaSat-1. Our network's unprecedented bandwidth has enabled us to increase the speed of our Exede consumer internet service by a factor of 25. Our in-flight connectivity service, Exede In The Air, routinely delivers speeds over 15 Mbps to each passenger on JetBlue, faster than many terrestrial broadband connections. That 15 Mbps can be up to 50 to 100 times faster on a per-passenger basis than other in-flight Wi-Fi services. And that's while connecting about four times as many passengers per flight. Our satellite services segment is driving growing cash profitability and improving margin, accounting for more than a third of revenues and over half of Adjusted EBITDA in the fiscal year. Financial and performance achievements like these show that satellite communications is undergoing a renaissance. We think the magnitude of change isn't well understood by many, including consumers of satellite services, users, and even people in the industry itself. That's because there are many different kinds of satellite communications companies. These companies proffer different strategies for creating and capturing economic value in relation to either other satellite services or terrestrial alternatives. 2 around 1 or 2 Gbps of bandwidth, enough to send a hundred or more high-definition TV channels. That might sound like a lot of video, but only in the context of linear TV. If you have hundreds of thousands of users watching different YouTube or Hulu or Netflix videos, that's not nearly enough bandwidth. WildBlue-1, launched in 2006, has about 7 Gbps. ViaSat-1 has 140 Gbps. ViaSat-2 will have much more. Compared to other networks such as xDSL or wireless, we can create satellite technology to move lots of video-on-demand data cargo at higher effective speed and lower cost. An important factor relative to bandwidth economics that we have demonstrated is that satellites, if carefully designed, are very capital efficient: the investment required to get hundreds of Gbps is not markedly different from getting just a handful. However, once a satellite is designed and built there is nothing that can be done to turn a 1 Gbps satellite into even a 7 Gbps satellite, let alone a 100 Gbps satellite. This means that a satellite with single- or double-digit Gbps is simply not economically competitive with one with triple digits if the goal is to serve customers who want the most data for a given amount of money. And when it comes to high-speed internet, that is definitely what customers want. Third, bandwidth is the most important element of broadband internet service quality in a video-on-demand world. There are several key metrics for broadband quality: speed, bandwidth, latency, and price. Internet data transmission is transportationmoving data bits from place to place. The transportation analogy helps illustrate the relative value of different attributes. Imagine you have a factory in Asia and you want to transport goods to North America. A lot of goods. The tonnage of cargo you move is like bandwidth (measured in Gigabytes vs. tons). On the internet, video accounts for most of the tonnage. Consider two extremes for moving your goods. A huge cargo ship is very cost effective, but takes weeks to make the trip. Air freight has a shorter transit time, but at a much higher 4 services with shorter latency, but slower speeds or less bandwidth, to Exede service. One vivid illustration is seen on in-flight connectivity. The most common form of commercial in-flight Wi-Fi today is air-to-ground (ATG) wireless links. ATG has almost no latency. Yet ATG typically rates as a poor internet connection, while JetBlue Fly-Fi using ViaSat Exede In The Air is consistently ranked as the best in-flight Wi-Fi experience. Of course, a low latency system with enough bandwidth is better than a higher latency system with more than enough bandwidth. But providing enough bandwidth in the on-demand video era is an enormous challenge. Users prefer satellite when it means the difference between video or no video (such as with Exede in-flight Wi-Fi compared to ATG), or when it means the difference between low resolution video and high definition (for a home user on a Skype video call or watching videos on YouTube or Amazon Prime). Gigabits per second, delivered in the best geographic markets, at the lowest total capital cost: we believe this is a playing field where we excel and where we are creating real competitive advantage. There is plenty of evidence that prudent investments in bandwidth productivity can be economically rewarding, even in the presence of lower latencybut also lower bandwidthcompetition. And importantly, when we don't meet some customers' expectations we usually find that it's not because of our latencyit's because our cargo ship still isn't quite as big as their video appetite (that is, we need more Gigabits, not less latency). One obvious corollary is that deploying satellite systems with shorter latency but much less bandwidth in the best geographic markets would be much less attractive than building satellites with way more bandwidth in the best places, even if the latency is longer. Fifth, the technologies needed to pack hundreds, or thousands, of Gigabits per second through satellites don't existyou have to invent them. We believe an analogy to Moore's law for digital chips is apt. Moore's law 6 FINANCIAL SUMMARY $345 $221 $163 $149 2012 2013 ADJUSTED EBITDA * 2014 2015 dollars in millions FISCAL YEAR $1,373 $1,426 $1,413 2014 2015 $1,009 2012 2013 NEW CONTRACT AWARDS dollars in millions FISCAL YEAR $1,351 $1,383 $1,120 $864 2012 REVENUES 2013 2014 dollars in millions FISCAL YEAR *See page 67 for a reconciliation of Adjusted EBITDA to net income (loss) attributable to ViaSat, Inc. 8 2015 PERFORMANCEGRAPH The following graph shows the value of an investment of $100 in cash on April 2, 2010 in (1) ViaSat's common stock, (2) the NASDAQ Telecommunications Index, (3) the NASDAQ Composite Index and (4) the S&P 600 SmallCap Index. The graph assumes that all dividends, if any, were reinvested. The stock price performance shown on the graph is based on historical data and should not be considered indicative of future performance. The information contained under this heading \"Performance Graph\" shall not be deemed to be \"soliciting material,\" or to be \"filed\" with the SEC, or subject to Regulation 14A or Regulation 14C or to the liabilities of Section 18 of the Securities Exchange Act of 1934, and shall not be deemed to be incorporated by reference into any filing of ViaSat, except to the extent that ViaSat specifically incorporates it by reference into a document filed under the Securities Act of 1933 or the Securities Exchange Act of 1934. $225 $200 $175 $150 $125 $100 $75 $50 4/2 7/2 10/1 12/31 4/1 7/ 1 9/30 12/30 3/30 6/29 9/28 12/2 83/29 6/28 10/4 1/3 4/4 7/4 10/3 1/2 4/3 2010 2010 2010 2010 2011 2011 2011 2011 2012 2012 2012 2012 2013 2013 2013 2014 2014 2014 2014 2015 2015 VIASAT, INC. NASDAQ COMPOSITE NASDAQ TELECOM S&P 600 SMALLCAP 10 SELECTED FINANCIAL DATA The following table provides our selected financial information for each of the fiscal years in the five-year period ended April 3, 2015. The data as of and for each of the fiscal years in the five-year period ended April 3, 2015 have been derived from our audited consolidated financial statements. You should consider the financial statement data provided below in conjunction with \"Management's Discussion and Analysis of Financial Condition and Results of Operations\" and the consolidated financial statements and notes which are included elsewhere in this Annual Report. Fiscal Years Ended April 3, 2015 April 4, 2014 March 29, 2013 March 30, 2012 April 1, 2011 (In thousands, except per share data) Consolidated Statements of Operations Data: Revenues: Product revenues ............................................ $ 728,074 Service revenues ............................................ 654,461 Total revenues .......................................................... Operating expenses: Cost of product revenues ............................... Cost of service revenues ................................ Selling, general and administrative ................ Independent research and development ......... Amortization of acquired intangible assets .... $ 785,738 565,724 $ 664,417 455,273 $ 542,064 321,563 $ 523,938 278,268 1,382,535 1,351,462 1,119,690 863,627 802,206 519,483 444,431 270,841 46,670 17,966 571,855 419,425 281,533 60,736 14,614 484,973 363,188 240,859 35,448 15,584 402,794 233,187 181,728 24,992 18,732 389,945 160,623 164,265 28,711 19,409 Income (loss) from operations ................................. Interest expense, net ................................................ Loss on extinguishment of debt ............................... 83,144 (29,426) 3,299 (37,903) (20,362) (43,820) (26,501) 2,194 (8,247) 39,253 (2,831) Income (loss) before income taxes .......................... Provision for (benefit from) income taxes ............... 53,718 13,827 (34,604) (25,947) (90,683) (50,054) (6,053) (13,651) 36,422 (2) Net income (loss) ..................................................... Less: Net (loss) income attributable to noncontrolling interest, net of tax ....................... 39,891 (8,657) (40,629) 7,598 36,424 102 309 (472) 789 543 Net income (loss) attributable to ViaSat, Inc. ......... $ 40,363 $ (9,446) $ (41,172) $ 7,496 $ 36,115 Basic net income (loss) per share attributable to ViaSat, Inc. common stockholders ..................... $ 0.86 $ (0.21) $ (0.94) $ 0.18 $ 0.88 Diluted net income (loss) per share attributable to ViaSat, Inc. common stockholders ..................... $ 0.84 $ (0.21) $ (0.94) $ 0.17 $ 0.84 Shares used in computing basic net income (loss) per share .............................................................. 47,139 45,744 43,931 42,325 40,858 Shares used in computing diluted net income (loss) per share .............................................................. 48,285 45,744 43,931 44,226 43,059 Consolidated Balance Sheet Data: Cash and cash equivalents ....................................... Working capital ....................................................... Total assets .............................................................. Senior notes, net ...................................................... Other long-term debt ............................................... Other liabilities ........................................................ Total ViaSat, Inc. stockholders' equity ................... $ 52,263 280,489 2,158,378 582,657 223,736 39,995 1,038,582 $ 58,347 256,795 1,960,115 583,861 105,900 48,893 941,012 $ 105,738 297,725 1,794,072 584,993 1,456 52,640 903,001 $ 172,583 327,110 1,727,153 547,791 774 50,353 887,975 $ 40,490 167,457 1,405,748 272,296 61,946 23,842 840,125 Our fiscal year 2013 information presented reflects the repurchase and redemption of our former 8.875% Senior Notes due 2016 (2016 Notes) and the associated $26.5 million loss on extinguishment of debt. Refer to Note 5 to the consolidated financial statements for discussion of the repurchase and redemption of all of the 2016 Notes and loss on extinguishment of debt. Our fiscal year 2015 reflects the amounts realized under our settlement agreement with Space Systems/Loral (SS/L) and Loral Space & Communications, Inc. (Loral) (the Settlement Agreement) of $53.7 million, of which $33.0 million was recognized as product revenues, $18.7 million 12 Government Systems Our government systems segment develops and produces network-centric Internet Protocol (IP)-based fixed and mobile secure government communications systems, products, services and solutions, which are designed to enable the collection and dissemination of secure real-time digital information between command centers, communications nodes and air defense systems. Customers of our government systems segment include the U.S. Department of Defense, armed forces, public safety first-responders and remote government employees. The primary products and services of our government systems segment include: Government mobile broadband service and product offerings, which provide military and government users with two-way mobile broadband connectivity via satellite in key regions of the world. Government satellite communication systems, which comprise an array of portable, mobile and fixed broadband modems, terminals, network access control systems and antenna systems using a range of satellite frequency bands for line-of-sight and beyond-line-of-sight Intelligence, Surveillance, and Reconnaissance and Command and Control missions, satellite networking services, network management systems for Wi-Fi and other internet access networks and global mobile broadband capability, and include products designed for manpacks, aircraft, unmanned aerial vehicles, seagoing vessels, ground mobile vehicles and fixed applications. Information security and assurance products and secure networking solutions, which provide advanced, high-speed IPbased \"Type 1\" and High Assurance Internet Protocol Encryption-compliant encryption solutions that enable military and government users to communicate information securely over networks, and that secure data stored on computers and storage devices. Tactical data links, including Multifunctional Information Distribution System (MIDS) terminals for military fighter jets and their successor, MIDS- Joint Tactical Radio System terminals, \"disposable\" weapon data links and portable small tactical terminals. Sources of Revenues Our satellite services segment revenues are primarily derived from our domestic satellite broadband services business and from our worldwide managed network services. Our products in our commercial networks and government systems segments are provided primarily through three types of contracts: fixed-price, time-and-materials and cost-reimbursement contracts. Fixed-price contracts (which require us to provide products and services under a contract at a specified price) comprised approximately 90%, 92% and 94% of our total revenues for these segments for fiscal years 2015, 2014 and 2013, respectively. The remainder of our revenue in these segments for such periods was derived from cost-reimbursement contracts (under which we are reimbursed for all actual costs incurred in performing the contract to the extent such costs are within the contract ceiling and allowable under the terms of the contract, plus a fee or profit) and from time-and-materials contracts (which reimburse us for the number of labor hours expended at an established hourly rate negotiated in the contract, plus the cost of materials utilized in providing such products or services). Our ability to grow and maintain our revenues in our commercial networks and government systems segments has to date depended on our ability to identify and target markets where the customer places a high priority on the technology solution, and our ability to obtain additional sizable contract awards. Due to the nature of this process, it is difficult to predict the probability and timing of obtaining awards in these markets. Historically, a significant portion of our revenues has been derived from customer contracts that include the research and development of products. The research and development efforts are conducted in direct response to the customer's specific requirements and, accordingly, expenditures related to such efforts are included in cost of sales when incurred and the related funding (which includes a profit component) is included in revenues. Revenues for our funded research and development from our customer contracts were approximately 23%, 31% and 26% of our total revenues during fiscal years 2015, 2014 and 2013, respectively. We also incur independent research and development (IR&D) expenses, which are not directly funded by a third party. IR&D expenses consist primarily of salaries and other personnel-related expenses, supplies, prototype materials, testing and certification related to research and development projects. IR&D expenses were approximately 3%, 5% and 3% of total revenues in fiscal years 2015, 2014 and 2013, respectively. As a government contractor, we are able to recover a portion of our IR&D expenses pursuant to our government contracts. Approximately 17%, 23% and 25% of our total revenues in fiscal years 2015, 2014 and 2013, respectively, were derived from international sales. Doing business internationally creates additional risks related to global political and economic conditions and other factors identified under the heading \"Risk Factors\" in our most recent Annual Report on Form 10-K. 14 In accordance with the authoritative guidance for revenue recognition for multiple element arrangements, the Accounting Standards Update (ASU) 2009-13 (ASU 2009-13), Revenue Recognition (ASC 605) Multiple-Deliverable Revenue Arrangements, which updates ASC 605-25, Revenue Recognition-Multiple element arrangements, of the Financial Accounting Standards Board (FASB) codification, for substantially all of the arrangements with multiple deliverables, we allocate revenue to each element based on a selling price hierarchy at the arrangement inception. The selling price for each element is based upon the following selling price hierarchy: vendor specific objective evidence (VSOE) if available, third party evidence (TPE) if VSOE is not available, or estimated selling price (ESP) if neither VSOE nor TPE are available (a description as to how we determine VSOE, TPE and ESP is provided below). If a tangible hardware systems product includes software, we determine whether the tangible hardware systems product and the software work together to deliver the product's essential functionality and, if so, the entire product is treated as a nonsoftware deliverable. The total arrangement consideration is allocated to each separate unit of accounting for each of the nonsoftware deliverables using the relative selling prices of each unit based on the aforementioned selling price hierarchy. Revenue for each separate unit of accounting is recognized when the applicable revenue recognition criteria for each element have been met. To determine the selling price in multiple-element arrangements, we establish VSOE of the selling price using the price charged for a deliverable when sold separately. We also consider specific renewal rates offered to customers for software license updates, product support and hardware systems support, and other services. For nonsoftware multiple-element arrangements, TPE is established by evaluating similar and/or interchangeable competitor products or services in standalone arrangements with similarly situated customers and/or agreements. If we are unable to determine the selling price because VSOE or TPE doesn't exist, we determine ESP for the purposes of allocating the arrangement by reviewing historical transactions, including transactions whereby the deliverable was sold on a standalone basis and considering several other external and internal factors including, but not limited to, pricing practices including discounting, margin objectives, competition, the geographies in which we offer our products and services, the type of customer (i.e. distributor, value added reseller, government agency or direct end user, among others), volume commitments and the stage of the product lifecycle. The determination of ESP considers our pricing model and go-to-market strategy. As our or our competitors' pricing and go-to-market strategies evolve, we may modify our pricing practices in the future, which could result in changes to our determination of VSOE, TPE and ESP. As a result, our future revenue recognition for multiple-element arrangements could differ materially from those in the current period. Collections in excess of revenues and deferred revenues represent cash collected from customers in advance of revenue recognition and are recorded in accrued liabilities for obligations within the next twelve months. Amounts for obligations extending beyond the twelve months are recorded within other liabilities in the consolidated financial statements. Warranty reserves We provide limited warranties on our products for periods of up to five years. We record a liability for our warranty obligations when we ship the products or they are included in long-term construction contracts based upon an estimate of expected warranty costs. Amounts expected to be incurred within twelve months are classified as accrued liabilities and amounts expected to be incurred beyond twelve months are classified as other liabilities in the consolidated financial statements. For mature products, we estimate the warranty costs based on historical experience with the particular product. For newer products that do not have a history of warranty costs, we base our estimates on our experience with the technology involved and the types of failures that may occur. It is possible that our underlying assumptions will not reflect the actual experience, and in that case, we will make future adjustments to the recorded warranty obligation. Property, equipment and satellites Satellites and other property and equipment are recorded at cost or in the case of certain satellites and other property acquired, the fair value at the date of acquisition, net of accumulated depreciation. Capitalized satellite 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 also construct gateway facilities, network operations systems and other assets to support our satellites, and those construction costs, including interest, are capitalized as incurred. At the time satellites are placed in service, we estimate the useful life of our satellites for depreciation purposes based upon an analysis of each satellite's performance against the original manufacturer's orbital design life, estimated fuel levels and related consumption rates, as well as historical satellite operating trends. We own two satellites: ViaSat-1 (our first high-capacity Ka-band spot-beam satellite, which was placed into service in January 2012) and WildBlue-1 (which was placed into service in March 2007). In May 2013, we entered into a satellite construction contract for ViaSat-2, our second high-capacity Ka-band satellite. In addition, we have an exclusive prepaid lifetime capital lease of Ka-band capacity over the contiguous United States on Telesat Canada's Anik F2 satellite (which was placed into service in April 2005) and own related gateway and networking equipment on all of our satellites. Property and equipment also includes the customer premise equipment (CPE) units leased to subscribers under a retail leasing program as part of our satellite services segment. 16 technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The authoritative guidance addresses the derecognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, and income tax disclosures. We are subject to income taxes in the United States and numerous foreign jurisdictions. In the ordinary course of business there are calculations and transactions where the ultimate tax determination is uncertain. In addition, changes in tax laws and regulations as well as adverse judicial rulings could adversely affect the income tax provision. We believe we have adequately provided for income tax issues not yet resolved with federal, state and foreign tax authorities. However, if these provided amounts prove to be more than what is necessary, the reversal of the reserves would result in tax benefits being recognized in the period in which we determine that provision for the liabilities is no longer necessary. If an ultimate tax assessment exceeds our estimate of tax liabilities, an additional charge to expense would result. Results of Operations The following table presents, as a percentage of total revenues, income statement data for the periods indicated. April 3, 2015 Fiscal Years Ended April 4, 2014 March 29, 2013 Revenues: ................................................................................ Product revenues ........................................................... Service revenues ............................................................ Operating expenses: Cost of product revenues ............................................... Cost of service revenues ................................................ Selling, general and administrative ............................... Independent research and development ........................ Amortization of acquired intangible assets ................... 100.0% 52.7 47.3 100.0% 58.1 41.9 100.0% 59.3 40.7 37.6 32.1 19.6 3.4 1.3 42.3 31.0 20.8 4.6 1.1 43.3 32.4 21.5 3.2 1.4 Income (loss) from operations ................................................ Interest expense, net ...................................................... Loss on extinguishment of debt ..................................... 6.0 (2.1) 0.2 (2.8) (1.8) (3.9) (2.4) Income (loss) before income taxes .......................................... Provision for (benefit from) income taxes .............................. 3.9 1.0 (2.6) (2.0) (8.1) (4.5) Net income (loss) .................................................................... Net income (loss) attributable to ViaSat, Inc. ......................... 2.9 2.9 (0.6) (0.7) (3.6) (3.7) Fiscal Year 2015 Compared to Fiscal Year 2014 Revenues Fiscal Years Ended April 3, 2015 (In millions, except percentages) April 4, 2014 Product revenues ........................................................ Service revenues ........................................................ $ 728.1 $ 654.5 785.7 $ 565.7 Total revenues ............................................................ $ 1,382.5 $ 1,351.5 $ Dollar Increase (Decrease) Percentage Increase (Decrease) (57.7) 88.7 (7.3)% 15.7% 31.1 2.3% Our total revenues grew by $31.1 million as a result of an $88.7 million increase in service revenues, offset by a $57.7 million decrease in product revenues. The service revenue increase was comprised primarily of $75.6 million in our satellite services segment and $14.0 million in our government systems segment. The product revenue decrease was driven by a decrease of $47.5 million in our commercial networks segment and $43.7 million in our government systems segment, offset by an increase of $33.5 million in our satellite services segment (related to the Settlement Agreement). 18 Amortization of acquired intangible assets We amortize our acquired intangible assets from prior acquisitions over their estimated useful lives ranging from two to ten years. The increase in amortization of acquired intangible assets of $3.4 million in fiscal year 2015 compared to last fiscal year was primarily the result of our acquisition of NetNearU in June 2014. Expected amortization expense for acquired intangible assets for each of the following periods is as follows: Amortization (In thousands) Expected for fiscal year 2016 ............................................................ Expected for fiscal year 2017 ............................................................ Expected for fiscal year 2018 ............................................................ Expected for fiscal year 2019 ............................................................ Expected for fiscal year 2020 ............................................................ Thereafter .......................................................................................... $ 15,135 7,821 6,487 3,974 2,942 5,981 $ 42,340 Interest income The $2.0 million increase in interest income in fiscal year 2015 compared to fiscal year 2014 was primarily due to the recognition of $2.0 million of payments made under the Settlement Agreement as interest income. Interest expense The decrease in interest expense year-over-year of $6.5 million was primarily due to an increase of $8.1 million in the amount of interest capitalized. This decrease was partially offset by increased interest expense on outstanding borrowings under our revolving credit facility (the Revolving Credit Facility) during fiscal year 2015 due primarily to higher outstanding balances compared to the prior year period. Capitalized interest expense during the fiscal years ended 2015 and 2014 related to the construction of ViaSat-2 and other assets. Provision for (benefit from) income taxes The effective income tax expense in fiscal year 2015 reflected the tax expense from the income before income taxes and the benefit from federal and state research tax credits. Fiscal year 2015 includes twelve months of federal research tax credit including three months from fiscal year 2014 and nine months from fiscal year 2015 as a result of the Tax Increase Prevention Act of 2014 enacted on December 19, 2014 which extended the research and development credit retroactively from January 1, 2014 to December 31, 2014. Fiscal year 2015 also included an expense related to the increase in valuation allowance related primarily to state net operating loss carryforwards and research and development credit carryforwards available to reduce state income taxes. The effective income tax benefit in fiscal year 2014 reflected the tax benefit from the loss before income taxes and the benefit from federal and state research tax credits. Due to the December 31, 2013 expiration of the federal research tax credit, fiscal year 2014 only included nine months of the federal research tax credit. Fiscal year 2014 also included a benefit related to the valuation allowance release related primarily to state net operating loss carryforwards as a result of the combination of the merger of ViaSat Communications, Inc. into ViaSat and changes in the apportioned state tax rates. Segment Results for Fiscal Year 2015 Compared to Fiscal Year 2014 Satellite services segment Revenues Fiscal Years Ended April 3, 2015 (In millions, except percentages) April 4, 2014 Dollar Increase (Decrease) Percentage Increase (Decrease) Segment product revenues ............................................... Segment service revenues ................................................ $ 33.6 $ 466.3 $ 390.7 33.5 75.6 100.0% 19.4% Total revenues .................................................................. $ 499.9 $ 390.7 $ 109.2 27.9% Our satellite services segment revenues grew by $109.2 million as a result of a $75.6 million increase in service revenues and a $33.5 million increase in product revenues. The increase in service revenues related primarily to retail and wholesale broadband services, and was primarily driven by an increase in the number of Exede broadband subscribers, as well as related higher average revenue per subscriber. Total broadband subscribers grew 7% from approximately 641,000 at April 4, 2014 to approximately 686,000 at April 3, 2015. The service revenue increase also reflected the expansion of our in-flight Wi-Fi service with over 330 aircraft in 20 Fiscal Years Ended April 3, 2015 (In millions, except percentages) Total revenues .................................................................. $ 535.5 $ April 4, 2014 565.2 $ Dollar Increase (Decrease) Percentage Increase (Decrease) (29.7) (5.3)% Our government systems segment revenues decreased by $29.7 million, due to a decrease of $43.7 million in product revenues, partially offset by a $14.0 million increase in service revenues. The decrease in product revenues was primarily due to revenue decreases of $83.7 million in government satellite communication systems (mainly attributable to command and control situational awareness) and a $5.7 million decrease in tactical satcom radio products (relating to our majority-owned subsidiary TrellisWare Technologies, Inc. (TrellisWare)). This decrease was partially offset by a $29.6 million increase in tactical data link products and $15.1 million increase in information assurance products. The increase in service revenues was primarily due to revenue increases of $23.2 million related to NetNearU, our newly acquired subsidiary, partially offset by a $4.7 million decrease related to government satellite communication systems services (mainly attributable to command and control situational awareness and global mobile broadband, offset by broadband networking services revenues for military customers), by a $2.9 million decrease in information assurance services and by a $1.3 million decrease in tactical data link services. Segment operating profit Fiscal Years Ended April 3, 2015 (In millions, except percentages) Segment operating profit .................................................. Percentage of segment revenues ....................................... $ 72.3 $ 13.5% April 4, 2014 76.0 $ 13.5% Dollar Increase (Decrease) Percentage Increase (Decrease) (3.7) (4.9)% The $3.7 million decrease in our government systems segment operating profit reflected higher new business proposal, support and selling costs of $16.3 million, offset by lower IR&D costs of $7.8 million and $4.8 million of higher earnings contributions (mainly from improved margins in global mobile broadband and the addition of our network management services for Wi-Fi and other internet access networks (relating to our newly acquired subsidiary NetNearU)). Fiscal Year 2014 Compared to Fiscal Year 2013 Revenues Fiscal Years Ended April 4, 2014 (In millions, except percentages) Product revenues ........................................................ Service revenues ........................................................ $ 785.7 $ 565.7 Total revenues ............................................................ $ 1,351.5 $ Dollar Increase (Decrease) March 29, 2013 664.4 $ 455.3 1,119.7 $ Percentage Increase (Decrease) 121.3 110.5 18.3% 24.3% 231.8 20.7% Our total revenues grew by $231.8 million as a result of a $121.3 million increase in product revenues and a $110.5 million increase in service revenues. The product revenue increase was comprised primarily of $83.1 million in our commercial networks segment and $42.9 million in our government systems segment. The service revenue increase was comprised primarily of $118.4 million in our satellite services segment, offset by a decrease of $5.4 million in our government systems segment. Cost of revenues Fiscal Years Ended April 4, 2014 (In millions, except percentages) March 29, 2013 Dollar Increase (Decrease) Percentage Increase (Decrease) Cost of product revenues .............................................. Cost of service revenues ............................................... $ 571.9 $ 419.4 485.0 $ 363.2 86.9 56.2 17.9% 15.5% Total cost of revenues ................................................... $ 991.3 $ 848.2 $ 143.1 16.9% Cost of revenues grew by $143.1 million due to a $86.9 million cost of product revenues increase and a $56.2 million cost of service revenues increase. The cost of product revenues increase was primarily due to increased revenues, causing an $88.6 million increase in cost of product revenues on a constant margin basis. This increase mainly related to growth in fixed satellite networks (driven by consumer broadband products), mobile broadband satellite communication systems, antenna systems products and satellite payload technology development programs in our commercial networks segment, but product sales also grew in our government systems segment from information assurance products, tactical data link products, and tactical satcom radio products (relating to our majority-owned subsidiary TrellisWare). The cost of service revenues increase was primarily due to increased service revenues, 22 Benefit from income taxes The effective income tax benefit in fiscal year 2014 reflected the tax benefit from the loss before income taxes and the benefit from federal and state research tax credits. Due to the December 31, 2013 expiration of the federal research tax credit, fiscal year 2014 only included nine months of the federal research tax credit. Fiscal year 2014 also included a benefit related to the valuation allowance release related primarily to state net operating loss carryforwards as a result of the combination of the merger of ViaSat Communications, Inc. into ViaSat and changes in the apportioned state tax rates. The effective income tax benefit in fiscal year 2013 reflected the tax benefit from the loss before income taxes and the benefit from federal and state research tax credits. Fiscal year 2013 included fifteen months of federal research tax credit as a result of the January 2013 reinstatement of the credit retroactively from January 1, 2012. Segment Results for Fiscal Year 2014 Compared to Fiscal Year 2013 Satellite services segment Revenues Fiscal Years Ended April 4, 2014 (In millions, except percentages) March 29, 2013 Dollar Increase (Decrease) Percentage Increase (Decrease) Segment product revenues .......................................... Segment service revenues ........................................... $ $ 390.7 4.7 $ 272.3 (4.7) 118.4 (99.1)% 43.5% Total revenues ............................................................. $ 390.7 $ 277.0 $ 113.7 41.1% Our satellite services segment revenues grew by $113.7 million, primarily due to the increase in service revenues related to retail and wholesale broadband services. The revenue increase relating to our Exede and WildBlue broadband services was driven by a 25% increase in the number of subscribers, which grew from approximately 512,000 at March 29, 2013 to approximately 641,000 at April 4, 2014, as well as a change in the mix of retail and wholesale subscribers and related higher average revenue per subscriber. Segment operating loss Fiscal Years Ended April 4, 2014 (In millions, except percentages) Segment operating loss ................................................ Percentage of segment revenues .................................. $ (46.0) $ (11.8)% March 29, 2013 (79.2) $ (28.6)% Dollar (Increase) Decrease 33.2 Percentage (Increase) Decrease 41.9% The $33.2 million reduction in operating loss for our satellite services segment was primarily due to $59.1 million in higher earnings contributions as our Exede broadband services subscriber base continued to grow, which resulted in increased revenues and improved margins, partially offset by $26.2 million in higher support and selling costs. These higher support and selling costs were mainly attributable to legal expense, approximately $18.4 million, focused on protecting and extending our technology advantages, as well as increased sales and marketing support costs as we continued to expand our consumer broadband subscriber base. Commercial networks segment Revenues Fiscal Years Ended April 4, 2014 (In millions, except percentages) March 29, 2013 Dollar Increase (Decrease) Percentage Increase (Decrease) Segment product revenues .......................................... Segment service revenues ........................................... $ 378.6 $ 16.9 295.5 $ 19.5 83.1 (2.5) 28.1% (13.0)% Total revenues ............................................................. $ 395.5 $ 314.9 $ 80.6 25.6% Our commercial networks segment revenues increased by $80.6 million, primarily due to the $83.1 million increase in product revenues. Of this product revenue increase, $55.6 million related to fixed satellite networks (driven by consumer broadband products), $18.8 million to mobile broadband satellite communication systems, $8.6 million to antenna systems products, and $6.7 million to satellite payload technology development programs. These increases were partially offset by a decrease in revenues for our satellite networking development programs of $7.6 million. 24 As of April 3, 2015 As of April 4, 2014 (In millions) Government Systems segment .................................... Total ................................................................... 307.9 $ 841.4 235.0 $ 852.6 The firm backlog does not include contract options. Of the $915.6 million in firm backlog, approximately $512.0 million is expected to be delivered in fiscal year 2016, and the balance is expected to be delivered in fiscal year 2017 and thereafter. We include in our backlog only those orders for which we have accepted purchase orders. Our total new awards were approximately $1,413.4 million, $1,425.9 million and $1,373.4 million for fiscal years 2015, 2014 and 2013, respectively. Backlog is not necessarily indicative of future sales. A majority of our contracts can be terminated at the convenience of the customer. Orders are often made substantially in advance of delivery, and our contracts typically provide that orders may be terminated with limited or no penalties. In addition, purchase orders may present product specifications that would require us to complete additional product development. A failure to develop products meeting such specifications could lead to a termination of the related contract. Firm backlog amounts are comprised of funded and unfunded components. Funded backlog represents the sum of contract amounts for which funds have been specifically obligated by customers to contracts. Unfunded backlog represents future amounts that customers may obligate over the specified contract performance periods. Our customers allocate funds for expenditures on long-term contracts on a periodic basis. Our ability to realize revenues from contracts in backlog is dependent upon adequate funding for such contracts. Although we do not control the funding of our contracts, our experience indicates that actual contract fundings have ultimately been approximately equal to the aggregate amounts of the contracts. Liquidity and Capital Resources Overview We have financed our operations to date primarily with cash flows from operations, bank line of credit financing, debt financing, export credit agency financing and equity financing. At April 3, 2015, we had $52.3 million in cash and cash equivalents, $280.5 million in working capital, $210.0 million in outstanding borrowings under our Revolving Credit Facility and $20.5 million in outstanding borrowings under our direct loan facility with the Export-Import Bank of the United States for ViaSat-2 (the Ex-Im Credit Facility and, together with the Revolving Credit Facility, the Credit Facilities). At April 4, 2014, we had $58.3 million in cash and cash equivalents, $256.8 million in working capital and $105.0 million in outstanding borrowings under our Revolving Credit Facility. We invest our cash in excess of current operating requirements in short-term, interest-bearing, investment-grade securities. Our future capital requirements will depend upon many factors, including the timing and amount of cash required for our ViaSat-2 satellite project and any future broadband satellite projects we may engage in, expansion of our research and development and marketing efforts, and the nature and timing of orders. Additionally, we will continue to evaluate possible acquisitions of, or investments in complementary businesses, products and technologies which may require the use of cash or additional financing. The general cash needs of our satellite services, commercial networks and government systems segments can vary significantly. The cash needs of our satellite services segment tend to be driven by the timing of capital expenditure payments (e.g., payments under satellite construction and launch contracts) and of network expansion activities, as well as the quality of customer, type of contract and payment terms. In our commercial networks segment, cash needs tend to be driven primarily by the type and mix of contracts in backlog, the nature and quality of customers, the level of investments in IR&D activities and the payment terms of customers (including whether advance payments are made or customer financing is required). In our government systems segment, the primary factors determining cash needs tend to be the type and mix of contracts in backlog (e.g., product or service, development or production) and timing of payments (including restrictions on the timing of cash payments under U.S. government procurement regulations). Other factors affecting the cash needs of our commercial networks and government systems segments include contract duration and program performance. For example, if a program is performing well and meeting its contractual requirements, then its cash flow requirements are usually lower. To further enhance our liquidity position or to finance the construction and launch of any future satellites, acquisitions or other business investment initiatives, we may obtain additional financing, which could consist of debt, convertible debt or equity financing from public and/or private credit and capital markets. In March 2013, we filed a universal shelf registration statement with the Securities and Exchange Commission (the SEC) for the future sale of an unlimited amount of debt securities, common stock, preferred stock, depositary shares, warrants and rights. The securities may be offered from time to time, separately or together, directly by us, by selling security holders, or through underwriters, dealers or agents at amounts, prices, interest rates and other terms to be determined at the time of the offering. We believe that our current cash balances and net cash expected to be provided by operating activities along 26 assurance that the number of subscribers of our Exede broadband services and service revenues in our satellite services segment will increase in any future period. Revolving Credit Facility As of April 3, 2015, the Revolving Credit Facility provided a $500.0 million revolving line of credit (including up to $150.0 million of letters of credit) with a maturity date of November 26, 2018. Borrowings under the Revolving Credit Facility bear interest, at our option, at either (1) the highest of the Federal Funds rate plus 0.50%, the Eurodollar rate plus 1.00%, or the administrative agent's prime rate as announced from time to time, or (2) the Eurodollar rate, plus, in the case of each of (1) and (2), an applicable margin that is based on our total leverage ratio. At April 3, 2015, the weighted average effective interest rate on our outstanding borrowings under the Revolving Credit Facility was 2.18%. The Revolving Credit Facility is required to be guaranteed by certain significant domestic subsidiaries of ViaSat (as defined in the Revolving Credit Facility) and secured by substantially all of our assets. As of April 3, 2015, none of our subsidiaries guaranteed the Revolving Credit Facility. The Revolving Credit Facility contains financial covenants regarding a maximum total leverage ratio and a minimum interest coverage ratio. In addition, the Revolving Credit Facility contains covenants that restrict, among other things, our ability to sell assets, make investments and acquisitions, make capital expenditures, grant liens, pay dividends and make certain other restricted payments. At April 3, 2015, we had $210.0 million in principal amount of outstanding borrowings under the Revolving Credit Facility and $40.4 million outstanding under standby letters of credit, leaving borrowing availability under the Revolving Credit Facility as of April 3, 2015 of $249.6 million. Ex-Im Credit Facility On March 12, 2015, a foreign subsidiary of ViaSat entered into the Ex-Im Credit Facility with the Export-Import Bank of the United States. As of April 3, 2015, the Ex-Im Credit Facility provided a $524.9 million senior secured direct loan facility, $467.0 million of which can be used to finance up to 85% of the costs of construction, launch and insurance of the ViaSat-2 satellite and related goods and services (including costs incurred on or after September 18, 2012), with the remainder used to finance the total exposure fees incurred under the Ex-Im Credit Facility of up to $57.9 million (depending on the total amount of financing borrowed under the Ex-Im Credit Facility). Borrowings under the Ex-Im Credit Facility bear interest at a fixed rate of 2.38% and are required to be repaid in 17 approximately equal semi-annual installments, commencing approximately six months after the in-orbit acceptance date of the ViaSat-2 satellite (or, if earlier, on October 15, 2017), with a maturity date of October 15, 2025. Exposure fees of $6.0 million were incurred in connection with our initial borrowing under the Ex-Im Credit Facility, with the remaining exposure fees payable by the in-orbit acceptance date for ViaSat-2. Exposure fees under the Ex-Im Credit Facility are amortized using the effective interest rate method. The effective interest rate on our outstanding borrowings under the Ex-Im Credit Facility, which takes into account estimated timing and amount of borrowings, exposure fees, debt issuance costs and other fees, was approximately 4.43% as of April 3, 2015. The Ex-Im Credit Facility is guaranteed by ViaSat and is secured by first-priority liens on the ViaSat-2 satellite and related assets as well as a pledge of the capital stock of the borrower under the facility. The Ex-Im Credit Facility contains financial covenants regarding ViaSat's maximum total leverage ratio and minimum interest coverage ratio. In addition, the Ex-Im Credit Facility contains covenants that restrict, among other things, our ability to sell assets, make investments and acquisitions, make capital expenditures, grant liens, pay dividends and make certain other restricted payments. At April 3, 2015, we had $20.5 million in principal amount of outstanding borrowings under the Ex-Im Credit Facility, leaving $452.5 million available to finance ViaSat-2 related costs as incurred. Borrowings under the Ex-Im Credit Facility were issued with a discount of $7.3 million (comprising the initial $6.0 million exposure fee and other customary fees). The borrowings under the Ex-Im Credit Facility are recorded as long-term debt, net of discount, in our consolidated financial statements. The discount and deferred financing cost associated with the issuance of the borrowings under the Ex-Im Credit Facility are amortized to interest expense on an effective interest rate basis over the term of the borrowings under the Ex-Im Credit Facility. Senior Notes Senior Notes due 2020 In February 2012, we issued $275.0 million in principal amount of 2020 Notes in a private placement to institutional buyers, which were exchanged in August 2012 for substantially identical 2020 Notes that had been registered with the SEC. These initial 2020 Notes were issued at face value and are recorded as long-term debt in our consolidated financial statements. On October 12, 2012, we issued an additional $300.0 million in principal amount of 2020 Notes in a private placement to institutional buyers at an issue price of 103.50% of the principal amount, which were exchanged in January 2013 for substantially identical 2020 Notes that had been registered with the SEC. The 2020 Notes are all treated as a single class. The 2020 Notes bear interest at the rate of 6.875% per year, payable semi-annually in cash in arrears, which interest payments commenced in June 2012. Debt issuance costs associated with the issuance of the 2020 Notes are amortized to interest expense on a straight-line basis over the term of the 2020 Notes, the results of which are not materially different from the effective interest rate basis. The $10.5 million premium we received in connection with the 28 (1) (2) To the extent that the interest rate is variable and ultimate amounts borrowed under the Revolving Credit Facility may fluctuate, amounts reflected represent estimated interest payments on our current outstanding balances based on the weighted average effective interest rate at April 3, 2015 until the maturity date in November 2018. To the extent that the ultimate amounts borrowed under the Ex-Im Credit Facility may fluctuate, amounts reflected represent estimated interest and principal payments on our current outstanding balance until the maturity date in October 2025. The amounts listed in the table above exclude the completion exposure fee that will be payable under the Ex-Im Credit Agreement by the in-orbit acceptance date for ViaSat-2, the amount of which will be based on the total amount of financing borrowed under the Ex-Im Credit Facility; see \"Liquidity and Capital Resources Ex-Im Credit Facility.\" We purchase components from a variety of suppliers and use several subcontractors and contract manufacturers to provide design and manufacturing services for our products. During the normal course of business, we enter into agreements with subcontractors, contract manufacturers and suppliers that either allow them to procure inventory based upon criteria defined by us or that establish the parameters defining our requirements. We have also entered into agreements with suppliers for the construction of our ViaSat-2 satellite, and operations of our satellites. In certain instances, these agreements allow us the option to cancel, reschedule and adjust our requirements based on our business needs prior to firm orders being placed. Consequently, only a portion of our reported purchase commitments arising from these agreements are firm, non-cancelable and unconditional commitments. See \"Liquidity and Capital Resources Satellite service-related activities.\" Our consolidated balance sheets included $40.0 million and $48.9 million of \"other liabilities\" as of April 3, 2015 and April 4, 2014, respectively, which primarily consisted of the long-term portion of our satellite performance incentives obligation, our longterm warranty obligations, the long-term portion of deferred rent, long-term portion of deferred revenue and long-term deferred income taxes. With the exception of the long-term portion of our satellite performance incentives obligation, these remaining liabilities have been excluded from the above table as the timing and/or the amount of any cash payment is uncertain. See Note 8 to our consolidated financial statements for additional information regarding our income taxes and related tax positions and Note 13 to our consolidated financial statements for a discussion of our product warranties. Off-Balance Sheet Arrangements We had no material off-balance sheet arrangements at April 3, 2015 as defined in Regulation S-K Item 303(a)(4) other than as discussed under Contractual Obligations above or disclosed in the notes to our consolidated financial statements included in this report. Recent Authoritative Guidance For information regarding recently adopted and issued accounting pronouncements, see Note 1 to the consolidated financial statements. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Interest Rate Risk Our financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, short-term and long-term obligations, including the Credit Facilities and the 2020 Notes, and foreign currency forward contracts. We consider investments in highly liquid instruments purchased with a remaining maturity of three months or less at the date of purchase to be cash equivalents. As of April 3, 2015, we had $210.0 million in principal amount of outstanding borrowings under our Revolving Credit Facility, $20.5 million in principal amount of outstanding borrowings under our Ex-Im Credit Facility, and $575.0 million in aggregate principal amount outstanding of the 2020 Notes, and we held no short-term investments. Our 2020 Notes and borrowings under our Ex-Im Credit Facility bear interest at a fixed rate and therefore our exposure to market risk for changes in interest rates relates primarily to borrowings under our Revolving Credit Facility, cash equivalents, short-term investments and short-term obligations. The primary objective of our investment activities is to preserve principal while at the same time maximizing the income we receive from our investments without significantly increasing risk. To minimize this risk, we maintain a significant portion of our cash balance in money market funds. In general, money market funds are not subject to interest rate risk because the interest paid on such funds fluctuates with the prevailing interest rate. Our cash and cash equivalents earn interest at variable rates. Our interest income has been and may continue to be negatively impacted by low market interest rates. Fixed rate securities may have their fair market value adversely impacted due to a rise in interest rates, while floating rate securities may produce less income than expected if interest rates fall. If the underlying weighted average interest rate on our cash and cash equivalents, assuming balances remain constant over a year, changed by 50 basis points, interest income would have increased or decreased by approximately $0.1 million and $0.1 million for the fiscal years ended April 3, 2015 and April 4, 2014, respectively. Because our investment policy restricts us to invest in conservative, interest-bearing investments and because our business strategy does not rely on generating material returns from our investment portfolio, we do not expect our market risk exposure on our investment portfolio to be material. As of April 3, 2015, we had $210.0 million in principal amount of outstanding borrowings under our Revolving Credit Facility. Our primary interest rate under the Revolving Credit Facility is the Eurodollar rate plus an applicable margin that is based on our total 30 Management's Report on Internal Control Over Financial Reporting The company's management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Under the supervision and with the participation of the company's management, including our Chief Executive Officer and Chief Financial Officer, the company conducted an evaluation of the effectiveness of its internal control over financial reporting based on criteria established in the framework in Internal Control Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, the company's management concluded that its internal control over financial reporting was effective as of April 3, 2015. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risks that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. The company's independent registered public accounting firm has audited the effectiveness of the company's internal control over financial reporting as of April 3, 2015, as stated in their report which appears on page F-1. Changes in Internal Control Over Financial Reporting We regularly review our system of internal control over financial reporting and make changes to our processes and systems to improve controls and increase efficiency, while ensuring that we maintain an effective internal control environment. Changes may include such activities as implementing new, more efficient systems, consolidating activities, and migrating processes. During the quarter ended April 3, 2015, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. 32 VIASAT, INC. CONSOLIDATED BALANCE SHEETS As of April 3, 2015 As of April 4, 2014 (In thousands, except share data) ASSETS Current assets: Cash and cash equivalents ....................................................................................... Accounts receivable, net .......................................................................................... Inventories ............................................................................................................... Deferred income taxes ............................................................................................. Prepaid expenses and other current assets ............................................................... $ 52,263 266,339 128,367 57,075 44,702 $ 58,347 271,891 119,601 37,712 44,070 Total current assets .................................................................................................. 548,746 531,621 Satellites, net ..................................................................................................................... Property and equipment, net .............................................................................................. Other acquired intangible assets, net ................................................................................. Goodwill ............................................................................................................................ Other assets ....................................................................................................................... 762,221 418,022 42,340 117,241 269,808 630,836 421,666 35,397 83,627 256,968 Total assets .............................................................................................................. $ 2,158,378 $ 1,960,115 $ $ LIABILITIES AND EQUITY Current liabilities: Accounts payable ..................................................................................................... Accrued liabilities .................................................................................................... 76,931 191,326 98,852 175,974 Total current liabilities ............................................................................................. 268,257 274,826 Senior notes, net ................................................................................................................ Other long-term debt ......................................................................................................... Other liabilities .................................................................................................................. 582,657 223,736 39,995 583,861 105,900 48,893 Total liabilities ......................................................................................................... 1,114,645 1,013,480 Commitments and contingencies (Notes 11 and 12) Equity: ViaSat, Inc. stockholders' equity Series A, convertible preferred stock, $.0001 par value; 5,000,000 shares authorized; no shares issued and outstanding at April 3, 2015 and April 4, 2014, respectively ........... Common stock, $.0001 par value, 100,000,000 shares authorized; 47,697,413 and 46,229,259 shares outstanding at April 3, 2015 and April 4, 2014, respectively Paid-in capital .......................................................................................................... Retained earnings .................................................................................................... Common stock held in treasury, at cost, no shares and 1,190,572 shares at April 3, 2015 and April 4, 2014, respectively .................................................................................. Accumulated other comprehensive income