Telesat Sees Increase in Q2 Revenue
Telesat revealed its financial results for its Second Quarter (Q2) 2019, in which it reported consolidated revenues of $174.8 million ($231 million CAD), an increase of 9 percent compared to the same period in 2018. When adjusting for the impact of foreign exchange rate changes, revenue increased by 8 percent compared to the same period in 2018. The increase was due to higher revenue related to the Telstar 19 VANTAGE and Telstar 18 VANTAGE satellites, which entered into commercial service in August 2018 and October 2018, respectively, combined with an increase from short-term services provided to other satellite operators.
Adjusted EBITDA for the quarter was $149 million ($197 million CAD); an increase of 10 percent compared to the same period in 2018. When adjusting for foreign exchange rate changes, Adjusted EBITDA increased by 9 percent. Telesat’s net income for the quarter was $102 million ($135 million CAD) compared to a net loss of $4.5 million ($6 million CAD) for the quarter ended June 30. The $142 million difference was the result of a higher non-cash gain on foreign exchange arising principally from the translation of Telesat’s U.S. dollar denominated debt into Canadian dollars, gains on financial instruments, and higher operating income in Q2 019.
“I am pleased with our financial and operating performance in the second quarter of 2019,” commented Dan Goldberg, Telesat’s President and CEO. “Our Telstar 19V and 18V satellites, as well as certain short term satellite services provided to another satellite operator, contributed to top line growth relative to Q2 last year, and our continued operating discipline resulted in an increase in both Adjusted EBITDA and our Adjusted EBITDA margin. In addition to a favorable second quarter, we also continue to make strong progress on our advanced Low-Earth Orbit (LEO) satellite constellation. Last week we signed a Memorandum of Understanding (MoU) with the Government of Canada (GoC) to ensure access to affordable high-speed Internet connectivity across rural and remote areas of Canada via the Telesat LEO Constellation, an arrangement we expect will generate $1.2 billion in revenue over a 10 year period. Additionally, the GoC will contribute $85 million to Telesat to support the development of the Telesat LEO Constellation through the Strategic Innovation Fund (SIF). Looking ahead we remain heavily focused on continuing to increase the utilization of our in-orbit satellites and executing on our key growth initiatives, particularly our LEO program.”