Viasat UK Limited - Limited company accounts 18.2

REGISTERED NUMBER: 03007498 (England and Wales)

Strategic Report, Report of the Directors and

Financial Statements

for the Year Ended 31 March 2018

for

Viasat UK Ltd

Page

Company Information

1

Strategic Report

2

Report of the Directors

3

Report of the Independent Auditors

5

Income Statement

7

Other Comprehensive Income

8

Statement of Financial Position

9

Statement of Changes in Equity

10

Notes to the Financial Statements

11

DIRECTORS:

Mr N Fraser

Mr R Blair

Ms S Duffy

Mr B Robins

SECRETARIES:

Mr R Blair

Bird & Bird Company Secretaries Limited

REGISTERED OFFICE:

Royal Pavilion Tower 2

Fourth Floor

Wellesley Road

Farnborough

Hampshire

GU11 1PZ

REGISTERED NUMBER:

03007498 (England and Wales)

AUDITORS:

Ward Goodman

Statutory Auditor

4 Cedar Park

Cobham Road

Ferndown Industrial Estate

Wimborne

Dorset

BH21 7SF

The directors present their strategic report for the year ended 31 March 2018.

Results for the 12 months ending 31 March 2018 showed a loss before tax of £354k.

This period has seen positive progress on a number of key projects for security on armoured vehicles and weapon systems, together

with steady sales of our core security products. Some successes in new markets reflect both an increase in threats and improved

customer understanding of our capabilities. We have also continued delivery of key satellite communication projects "match funded"

by the European Space Agency. These projects, centred around medical and unmanned air vehicles, together with work being carried

out by UK staff funded by larger US programmes, has seen us grow our engineering skills base. We have recruited new staff,

including additional interns, to carry out software work critical to the wider US company, and this has established the UK team's

credibility, which will lead to more work. Viasat UK has continued to grow its influence in the UK's space community, and also been

active with the UK Government on ways to solve the "digital divide" using satellite broadband. We have continued to chair UK

Space Trade Association's Security and Defence Committee, which generates profile and views to the MOD and wider industry.

During this period, Viasat has increased its profile with the UK Ministry of Defence, engaging on a number of significant defence

communication programmes, and is now gaining broad support for both our technology and ideas. Viasat UK is a strategic focus for

our parent company and, in line with this, the business has seen significant change, reflecting changes in direction and better

preparing the business for future growth. During this period, we have worked towards a strategic acquisition of a company with

integration and delivery capabilities well proven with the MOD. This acquisition was finalised outside this reporting period, but has

significantly improved our capabilities and given us a second location, close to the UK Government's cyber security centre with

which we have a close and deepening relationship, key to current and future programmes.

PRINCIPAL RISKS AND UNCERTAINTIES

Financial Risk Management Objectives

Cash flow risk

Viasat UK Ltd has limited exposure to foreign exchange risk as the majority of foreign exchange transactions are with its parent

company, Viasat, Inc.

Credit risk

The company's principal financial assets are bank balances and trade and other receivables. The credit risk on liquid funds is limited

because the counterparties are banks with high credit ratings assigned by international credit ratings agencies. Viasat UK Ltd has no

significant concentration of credit risk, with exposure spread over a large number of counter parties and customers.

Liquidity risk

In order to maintain liquidity to ensure that sufficient working capital is available for ongoing operations and future developments

cash reserves are maintained. In addition Viasat UK Ltd has the continued support of its parent company Viasat, Inc.

ON BEHALF OF THE BOARD:

Ms S Duffy - Director

28 February 2019

The directors present their report with the financial statements of the company for the year ended 31 March 2018.

PRINCIPAL ACTIVITY

The principal activity of the company in the period under review was that of design, development, manufacturing and marketing of

computer related security and communications products, the development of bespoke security systems and the manufacture of

electronic systems.

DIVIDENDS

No dividends will be distributed for the year ended 31 March 2018.

DIRECTORS

Mr N Fraser has held office during the whole of the period from 1 April 2017 to the date of this report.

Other changes in directors holding office are as follows:

Mr C J McIntosh - resigned 30 November 2017

Mr K Lippert - resigned 14 February 2018

Mr R Baldridge - resigned 14 February 2018

Mr T D Stone - resigned 14 February 2018

Mr R Blair - appointed 14 February 2018

Ms S Duffy - appointed 14 February 2018

Mr A Pine - resigned 31 January 2018

Mr B Robins - appointed 14 February 2018

DISCLOSURE IN THE STRATEGIC REPORT

A strategic report has been included disclosing information in respect of the company's future development, research and

development activities as well as any post balance sheet events affecting the company.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements in

accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected

to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom

Accounting Standards and applicable law), including Financial Reporting Standard 102 'The Financial Reporting Standard applicable

in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are

satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that

period. In preparing these financial statements, the directors are required to:

-	select suitable accounting policies and then apply them consistently;

-	make judgements and accounting estimates that are reasonable and prudent;

-	prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's

transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that

the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company

and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of

which the company's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in

order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that

information.

AUDITORS

The auditors, Ward Goodman, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

Ms S Duffy - Director

28 February 2019

Opinion

We have audited the financial statements of Viasat UK Ltd (the 'company') for the year ended 31 March 2018 which comprise the

Income Statement, Other Comprehensive Income, Statement of Financial Position, Statement of Changes in Equity and Notes to the

Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been

applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard

102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted

Accounting Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31 March 2018 and of its loss for the year then ended;

-	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

-	have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our

responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements

section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of

the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in

accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a

basis for our opinion.

Conclusions relating to going concern

We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:

-	the directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or

-

the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.

Other information

The directors are responsible for the other information. The other information comprises the information in the Strategic Report and

the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion

thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider

whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or

otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material

misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinion on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

-	the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not

identified material misstatements in the Strategic Report or the Report of the Directors.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our

opinion:

-	adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

-	the financial statements are not in agreement with the accounting records and returns; or

-	certain disclosures of directors' remuneration specified by law are not made; or

-	we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page three, the directors are responsible for the

preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the

directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due

to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern,

disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either

intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditors' responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material

misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion. Reasonable assurance is

a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material

misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the

aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial

statements.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's

website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006.

Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them

in a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility

to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we

have formed.

Mr I M Rodd (Senior Statutory Auditor)

for and on behalf of Ward Goodman

Statutory Auditor

4 Cedar Park

Cobham Road

Ferndown Industrial Estate

Wimborne

Dorset

BH21 7SF

5 March 2019

TURNOVER

3

9,361

8,703

Cost of sales

5,111

5,637

GROSS PROFIT

4,250

3,066

Distribution costs

18

19

Administrative expenses

4,720

5,323

4,738

5,342

(488

)

(2,276

)

Other operating income

209

205

OPERATING LOSS

5

(279

)

(2,071

)

Interest payable and similar expenses

6

75

-

LOSS BEFORE TAXATION

(354

)

(2,071

)

Tax on loss

7

58

-

LOSS FOR THE FINANCIAL YEAR

(412

)

(2,071

)

LOSS FOR THE YEAR

(412

)

(2,071

)

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

(412

)

(2,071

)

FIXED ASSETS

Intangible assets

8

-

-

Tangible assets

9

1,327

884

1,327

884

CURRENT ASSETS

Stocks

10

642

897

Debtors

11

3,780

2,903

Cash at bank and in hand

838

1,175

5,260

4,975

CREDITORS

Amounts falling due within one year

12

6,512

5,403

NET CURRENT LIABILITIES

(1,252

)

(428

)

TOTAL ASSETS LESS CURRENT LIABILITIES

75

456

CREDITORS

Amounts falling due after more than one year

13

144

113

NET (LIABILITIES)/ASSETS

(69

)

343

CAPITAL AND RESERVES

Called up share capital

15

1

1

Share premium

16

1,706

1,706

Contribution from parent

16

196

196

Retained earnings

16

(1,972

)

(1,560

)

SHAREHOLDERS' FUNDS

(69

)

343

The financial statements were approved by the Board of Directors on 28 February 2019 and were signed on its behalf by:

Ms S Duffy - Director

Called up

Contribution

share

Retained

Share

from

Total

capital

earnings

premium

parent

equity

£'000

£'000

£'000

£'000

£'000

Balance at 1 April 2016

1

511

1,706

196

2,414

Changes in equity

Total comprehensive income

-

(2,071

)

-

-

(2,071

)

Balance at 31 March 2017

1

(1,560

)

1,706

196

343

Changes in equity

Total comprehensive income

-

(412

)

-

-

(412

)

Balance at 31 March 2018

1

(1,972

)

1,706

196

(69

)

1.	STATUTORY INFORMATION

Viasat UK Ltd is a private company, limited by shares , registered in England and Wales. The company's registered number

and registered office address can be found on the Company Information page.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

Viasat UK Limited is a company incorporated in the United Kingdom under the Companies Act. The address of the

registered office is given on the Company Information page. The nature of the company's operations and its principal

activities are set out in the Report of the Directors.

The functional currency of Viasat UK Limited is considered to be pounds sterling because that is the currency of the primary

economic environment in which the Company operates.

Going Concern

The directors consider the Company will continue in operational existence for the foreseeable future and therefore have

prepared the financial statements on the going concern basis. Viasat UK Ltd has the full support and backing of Viasat Inc.

to support our operations and long term growth plan.

Financial Reporting Standard 102 - reduced disclosure exemptions

The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as

permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":

•

the requirements of Section 7 Statement of Cash Flows;

•

the requirements of Section 26 Share-based Payment paragraphs 26.18(b), 26.19 to 26.21 and 26.23;

•

the requirement of Section 33 Related Party Disclosures paragraph 33.7.

Viasat UK Limited meets the definition of a qualifying entity under FRS 102 and has therefore taken advantage of the

disclosure exemptions available to it in respect of its separate financial statements, which are presented alongside the

consolidated financial statements. Exemptions have been taken in relation to share-based payments, presentation of a cash

flow statement, remuneration of key personnel and related party disclosures.

The company is consolidated in the financial statements of Viasat, Inc. Copies of the consolidated financial statements are

publicly available from Viasat, Inc. of 6155 El Camino Real Carlsbad, CA 92009, USA.

Related party exemption

The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial

Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly

owned subsidiaries within the group.

Turnover

Turnover represents net invoiced sales of goods, excluding value added tax.

Turnover is recognised when the significant risks and rewards of ownership are considered to have been transferred to the

buyer.

Where a contract has only been partially completed at the balance sheet date turnover represents the fair value of the service

provided to date based on the stage of completion of the contract activity at the balance sheet date. Where payments are

received from customers in advance of services provided, the amounts are recorded as deferred income and included as part

of creditors due within one year.

The stage of completion of contracts is determined by the proportion that the contract costs incurred for work performed to

date bear to the estimated total contract costs.

Intangible assets

Amortisation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Software - Straight line over 3 years

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life or, if held

under finance lease, over the term of the lease, whichever is shorter.

Short leasehold

Straight line

Over the lease term

Assets under construction

N/A

Not depreciated

Plant and machinery

Straight line

Varying rates depending on the useful life of the asset

Stocks and work in progress

Stocks and work in progress are valued at the lower of cost and net realisable value, after making due allowance for obsolete

and slow moving items. Cost includes all direct expenditure and an appropriate proportion of fixed and variable overheads.

Cost is calculated using the FIFO (first-in, first-out) method.

Work in progress in respect of long term and third party service contracts is valued at cost, net of amounts taken to cost of

sales, after deducting foreseeable losses and progress payments not matched to turnover. Amounts recoverable on contracts

are included in debtors and represent turnover recognised in excess of payments on account.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that

it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively

enacted by the statement of financial position date.

Deferred tax

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be

recovered against the reversal of deferred tax liabilities or other future taxable profits.

Research and development

Expenditure on research and development is written off in the year in which it is incurred.

Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the statement of

financial position date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date

of transaction. Exchange differences are taken into account in arriving at the operating result.

Hire purchase and leasing commitments

Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease.

Benefits received and receivable as an incentive to sign an operating lease are similarly spread on a straight line basis over

the lease term.

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are

charged to profit or loss in the period to which they relate.

Included within other creditors at the balance sheet date were amounts due to the pension scheme of £31k (2017 - £29k).

Debtors

Short term debtors are measured at transaction price, less any provisions for amounts considered irrecoverable.

Creditors

Short term trade and other creditors are measured at transaction price. Other financial liabilities are measured initially at fair

value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

Critical accounting judgements and key sources of estimation uncertainty

In the application of the company's accounting policies, which are described above, the directors are required to make

judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from

other sources.

The most significant judgements required are the valuation of work-in-progress and the stock obsolescence provision. These

estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are

recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the

revision and future periods if the revision affects both current and future periods.

The most significant estimates are to do with revenue recognition. Specifically, deferred and accrued income for development

contracts. Management estimate the percentage of completion of a development contract in order to determine the amount of

revenue to recognise in the year. The estimate of the stage of completion is based on the total costs actually incurred as a

proportion of the total budgeted costs on a contract. Revenue is subsequently recognised at the same proportion.

3.

TURNOVER

The turnover and loss before taxation are attributable to the one principal activity of the company.

An analysis of turnover by geographical market is given below:

2018

2017

£'000

£'000

United Kingdom

6,189

5,371

Overseas

3,172

3,332

9,361

8,703

4.	EMPLOYEES AND DIRECTORS

2018

2017

£'000

£'000

Wages and salaries

1,859

1,941

Social security costs

429

318

Other pension costs

261

219

2,549

2,478

The average number of employees during the year was as follows:

2018

2017

Development

28

26

Manufacturing

7

13

Administration and management

20

27

55

66

Included within wages and salaries is £8k (2017; £105k) of redundancy costs.

2018

2017

£

£

Directors' remuneration

356,293

216,384

Directors' pension contributions to money purchase schemes

53,683

43,810

The number of directors to whom retirement benefits were accruing was as follows:

Money purchase schemes

2

2

Information regarding the highest paid director is as follows:

2018

2017

£

£

Emoluments etc

134,568

134,365

Pension contributions to money purchase schemes

49,045

3,810

5.	OPERATING LOSS

The operating loss is stated after charging/(crediting):

2018

2017

£'000

£'000

Other operating leases

203

247

Depreciation - owned assets

623

363

Profit on disposal of fixed assets

-

(30

)

Auditors' remuneration

15

12

Foreign exchange differences

(242

)

178

Auditors remuneration for taxation services

-

2

Auditors remuneration for other services

2

-

6.

INTEREST PAYABLE AND SIMILAR EXPENSES

2018

2017

£'000

£'000

Loan

75

-

7.

TAXATION

Analysis of the tax charge

The tax charge on the loss for the year was as follows:

2018

2017

£'000

£'000

Current tax:

UK corporation tax

58

-

Tax on loss

58

-

Reconciliation of total tax charge included in profit and loss

The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below:

2018

2017

£'000

£'000

Loss before tax

(354

)

(2,071

)

Loss multiplied by the standard rate of corporation tax in the UK of 19% (2017 - 20%)

(67

)

(414

)

Effects of:

Depreciation in excess of capital allowances

54

14

Employee share acquisition relief

10

(99

)

Expenses not deductible for tax purposes

4

71

Movement in tax loss carried forward

(1

)

428

R&D tax credit corporation tax deduction

58

-

Total tax charge

58

-

At the balance sheet date, the company has an unrecognised deferred tax asset of £1,208k (2017 - £931k) in relation to

unused revenue losses and accelerated capital allowances. This has not been provided on the basis that the directors do not

consider it more likely than not that taxable profits will arise in the near future. If sufficient taxable profits are made in the

future, the asset will become recoverable.

8.	INTANGIBLE FIXED ASSETS

Computer

software

£'000

COST

At 1 April 2017

and 31 March 2018

82

AMORTISATION

At 1 April 2017

and 31 March 2018

82

NET BOOK VALUE

At 31 March 2018

-

At 31 March 2017

-

9.	TANGIBLE FIXED ASSETS

Assets

Short

under

Plant and

leasehold

construction

machinery

Totals

£'000

£'000

£'000

£'000

COST

At 1 April 2017

773

34

1,278

2,085

Additions

921

-

145

1,066

Transfer to ownership

34

(34

)

-

-

At 31 March 2018

1,728

-

1,423

3,151

DEPRECIATION

At 1 April 2017

289

-

912

1,201

Charge for year

457

-

166

623

At 31 March 2018

746

-

1,078

1,824

NET BOOK VALUE

At 31 March 2018

982

-

345

1,327

At 31 March 2017

484

34

366

884

10.

STOCKS

2018

2017

£'000

£'000

Finished goods

461

421

Raw materials

173

471

Work-in-progress

8

5

642

897