Telesat Q2 2022

In its Q2 2022 financial results, Canadian satellite operator Telesat reported:

• Consolidated revenue of $187 million, a decrease of $1 million compared to the same period in 2021. When adjusted for changes in foreign exchange rates, revenue declined 3% compared to 2021. The decline was attributed to a partial renewal of a long-term contract with Dish.
• Telesat’s net loss for the second quarter was $4 million, compared to net income of $53 million for the second quarter of 2021.
• Financing discussions with Export Credit Agencies (ECAs) for Telesat’s Lightspeed constellation hits delays. CEO Dan Goldberg said the company will likely need to secure additional funding to deal with increased costs and expects to sign a ECA funding term sheet by the end of the year. Finalizing the financing is expected to take longer.
• Thales on the hot seat. Goldberg said Lightspeed manufacturer Thales Alenia Space was delayed in delivering its final proposal for the constellation, which affected the timing of ECA discussions. Goldberg emphasized that Telesat has confidence in Thales, but said that Telesat is “not locked in to its vendor selection.”
•  Telesat has already downsized plans for the constellation due to inflation and supply chain issues from the planned 298 satellites to 188 with 10 in-orbit spares. Inflation is likely driving the planned $5 billion cost up “hundreds of millions of dollars,” but less than 10% of the total cost, Goldberg said.
• Despite this news,  Telesat raised 2022 guidance, and now expects its full year 2022 revenues to be between $740 million and $750 million. The previous range was between $720 million and $740 million.