Big Fall in Operating Expenses for Telesat’s Q1 2018
Telesat Canada has announced its financial results for the three-month period ended March 31 under International Financial Reporting Standards (IFRS).
The company reported consolidated revenues of CA$232 million ($251.2 million), compared to CA$235 million ($182.8 million) in the same period in 2017. Operating expenses of CA$38 million ($29.6 million) for the quarter were 31 percent lower than the same period in 2017. The decrease in operating expenses was primarily due to a decrease in compensation and employee benefits expense arising from a special payment of CA$12 million ($9.3 million) made during the first quarter of 2017 to stock option holders in connection with a return of capital to Telesat’s shareholders.
Adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) was CA$195 million ($151.7), an increase of 1 percent compared to the same period in 2017. The Adjusted EBITDA margin was 83.9 percent, compared to 81.9 percent in the same period in 2017.
On Jan. 1, Telesat adopted IFRS 9, Financial Instruments, and IFRS 15, Revenue from Contracts with Customers. For the three-month period ended March 31, the adoption of IFRS 15 had a net positive impact of approximately CA$4 million ($3.1) on revenues, a reduction of approximately CA$5 million ($3.9) on operating expenses and a positive impact of approximately CA$9 million ($7 million) on Adjusted EBITDA. The adoption of IFRS 9 had no impact on revenues, operating expenses and Adjusted EBITDA.
Telesat’s net loss for the quarter was CA$15 million ($11.7 million) compared to net income of CA$88 million ($68.5) for the first quarter of 2017. The difference was the result of a higher non-cash loss on foreign exchange arising principally from the translation of Telesat’s US dollar denominated debt into Canadian dollars in the first quarter of 2018.