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No Update on Lightspeed Financing in Telesat Q1 Results 

By Rachel Jewett | May 11, 2023

Telesat’s headquarters in downtown Ottawa, Ontario, Canada. Photo: Telesat

Telesat’s first quarter 2023 results did not offer much of an update on funding for the Lightspeed constellation, but discussions are continuing, CEO Dan Golderg said in a call with investors on Thursday. 

Telesat is in discussions with various parties to cover increased costs to the program, but the operator is delayed in securing the financing after an update was expected at the end of 2022. Telesat is looking for equity investors specifically for the Lightspeed Low-Earth Orbit project, which Goldberg previously said would be subordinate to other funding sources including Bpifrance export credit agency and the governments of Canada and Quebec.

“LEO discussions with the various parties are continuing,” Goldberg said on Thursday. “We’re engaging with the parties that we’ve been engaging with. I think we’re making headway.” 

He estimated Lightspeed could start launching in 2026. The initial plan was for launches to start this year.  

Last quarter,  The operator disclosed in filings to the Securities and Exchange Commission (SEC) that it will not be able to meet some of the regulatory milestones under its spectrum authorizations, particularly the milestones under its U.S. first round market access grant. 

First Quarter Results 

Telesat’s revenue dipped slightly in the first quarter of 2023 with reduced revenue from a North American broadcast customer. The operator reported $183 million Canadian dollars ($136 million) of revenue in Q1, a decrease of 1% compared to the same period in 2022. When adjusted for changes in foreign exchange rates, revenue declined 5% compared to 2022. 

Despite the slight dip in revenue, Telesat reported higher equipment sales to Canadian government customers along with increased services to aero and maritime customers. 

Net income was CA$29 million ($21.5 million) compared to CA$61 million ($45 million) in the same time last year, due to gain on extinguishment of debt in the first quarter of 2022, combined with higher interest expense and lower foreign exchange gains. 

The company affirmed full year guidance of revenue between CA$690 million and CA$710 million ($512 million to $526 million). 

Backlog, not including Lightspeed backlog, stands at CA$1.7 billion ($1.3 billion) and fleet utilization is at 88%.