Telesat Reports Results for the Quarter and Twelve Months Ended December 31, 2024
Telesat (NASDAQ/TSX: TSAT) reported its financial results for Q4 and FY2024, showing significant challenges ahead. Revenue for 2024 declined 19% to C$571 million, while Adjusted EBITDA decreased 28% to C$384 million. The company posted a net loss of C$302 million for 2024.
Key developments include securing C$2.54 billion in loan financing from Canadian and Quebec governments for the Telesat Lightspeed LEO satellite program, and successful completion of its Preliminary Design Review. The company maintains a GEO backlog of C$1.1 billion with 72% fleet utilization.
For 2025, Telesat projects revenue between C$405-425 million and Adjusted EBITDA of C$170-190 million, representing a 53% decline at midpoint. This outlook reflects reduced revenues from North American DTH customers, maritime markets, and increased LEO operating expenses. CFO Andrew Browne announced plans to retire later in 2025.
Telesat (NASDAQ/TSX: TSAT) ha riportato i suoi risultati finanziari per il quarto trimestre e l'anno fiscale 2024, evidenziando sfide significative in arrivo. I ricavi per il 2024 sono diminuiti del 19% a C$571 milioni, mentre l'EBITDA rettificato è sceso del 28% a C$384 milioni. L'azienda ha registrato una perdita netta di C$302 milioni per il 2024.
Sviluppi chiave includono l'ottenimento di C$2,54 miliardi in finanziamenti attraverso prestiti dai governi canadese e del Quebec per il programma satellitare Telesat Lightspeed LEO, e il completamento con successo della sua Revisione del Design Preliminare. L'azienda mantiene un portafoglio GEO di C$1,1 miliardi con una percentuale di utilizzo della flotta del 72%.
Per il 2025, Telesat prevede ricavi tra C$405-425 milioni e un EBITDA rettificato di C$170-190 milioni, rappresentando un calo del 53% a metà intervallo. Questa previsione riflette la riduzione dei ricavi dai clienti DTH nordamericani, dai mercati marittimi e l'aumento delle spese operative LEO. Il CFO Andrew Browne ha annunciato piani per andare in pensione entro la fine del 2025.
Telesat (NASDAQ/TSX: TSAT) reportó sus resultados financieros para el cuarto trimestre y el año fiscal 2024, mostrando desafíos significativos por delante. Los ingresos para 2024 disminuyeron un 19% a C$571 millones, mientras que el EBITDA ajustado cayó un 28% a C$384 millones. La compañía registró una pérdida neta de C$302 millones para 2024.
Los desarrollos clave incluyen la obtención de C$2.54 mil millones en financiamiento de préstamos de los gobiernos de Canadá y Quebec para el programa de satélites Telesat Lightspeed LEO, y la finalización exitosa de su Revisión de Diseño Preliminar. La empresa mantiene una cartera GEO de C$1.1 mil millones con una utilización de flota del 72%.
Para 2025, Telesat proyecta ingresos entre C$405-425 millones y un EBITDA ajustado de C$170-190 millones, lo que representa una disminución del 53% en el punto medio. Esta perspectiva refleja ingresos reducidos de clientes DTH en América del Norte, mercados marítimos y un aumento en los gastos operativos LEO. El CFO Andrew Browne anunció planes para retirarse a finales de 2025.
텔레샛(Telesat) (NASDAQ/TSX: TSAT)는 2024 회계연도 4분기 및 연간 재무 결과를 발표하며 상당한 도전 과제가 있음을 보여주었습니다. 2024년 수익은 19% 감소하여 C$571백만에 이르렀고, 조정 EBITDA는 28% 감소하여 C$384백만으로 나타났습니다. 회사는 2024년 동안 C$302백만의 순손실을 기록했습니다.
주요 개발 사항으로는 텔레샛 라이트스피드(Telesat Lightspeed) LEO 위성 프로그램을 위해 캐나다 및 퀘벡 정부로부터 C$25.4억의 대출 자금을 확보한 것과 초기 설계 검토를 성공적으로 완료한 것이 있습니다. 회사는 72%의 함대 활용률로 C$11억의 GEO 백로그를 유지하고 있습니다.
2025년을 위해 텔레샛은 C$405-425백만의 수익과 C$170-190백만의 조정 EBITDA를 예상하며, 이는 중간값에서 53% 감소한 수치입니다. 이 전망은 북미 DTH 고객, 해양 시장에서의 수익 감소와 LEO 운영 비용 증가를 반영합니다. CFO인 앤드류 브라운(Andrew Browne)은 2025년 말에 은퇴할 계획을 발표했습니다.
Telesat (NASDAQ/TSX: TSAT) a publié ses résultats financiers pour le quatrième trimestre et l'exercice 2024, montrant des défis significatifs à venir. Les revenus pour 2024 ont diminué de 19 % pour atteindre 571 millions de C$, tandis que l'EBITDA ajusté a baissé de 28 % pour s'établir à 384 millions de C$. L'entreprise a affiché une perte nette de 302 millions de C$ pour 2024.
Les développements clés incluent l'obtention de 2,54 milliards de C$ en financement par emprunt auprès des gouvernements canadien et du Québec pour le programme de satellite Telesat Lightspeed LEO, ainsi que l'achèvement réussi de sa Revue de Conception Préliminaire. L'entreprise maintient un carnet de commandes GEO de 1,1 milliard de C$ avec un taux d'utilisation de la flotte de 72 %.
Pour 2025, Telesat prévoit des revenus compris entre 405 et 425 millions de C$ et un EBITDA ajusté de 170 à 190 millions de C$, représentant une baisse de 53 % à la moyenne. Cette prévision reflète une diminution des revenus des clients DTH nord-américains, des marchés maritimes et une augmentation des coûts d'exploitation LEO. Le CFO Andrew Browne a annoncé son intention de prendre sa retraite plus tard en 2025.
Telesat (NASDAQ/TSX: TSAT) hat seine finanziellen Ergebnisse für das vierte Quartal und das Geschäftsjahr 2024 veröffentlicht und zeigt erhebliche Herausforderungen voraus. Der Umsatz für 2024 sank um 19% auf C$571 Millionen, während das bereinigte EBITDA um 28% auf C$384 Millionen fiel. Das Unternehmen verzeichnete einen Nettoverlust von C$302 Millionen für 2024.
Wichtige Entwicklungen umfassen die Sicherstellung von C$2,54 Milliarden an Darlehensfinanzierungen von den Regierungen von Kanada und Quebec für das Telesat Lightspeed LEO-Satellitenprogramm und den erfolgreichen Abschluss der vorläufigen Entwurfsprüfung. Das Unternehmen hält einen GEO-Auftragsbestand von C$1,1 Milliarden mit einer Flottenauslastung von 72%.
Für 2025 prognostiziert Telesat einen Umsatz zwischen C$405-425 Millionen und ein bereinigtes EBITDA von C$170-190 Millionen, was einem Rückgang von 53% im Mittelwert entspricht. Dieser Ausblick spiegelt reduzierte Einnahmen von nordamerikanischen DTH-Kunden, maritimen Märkten und steigenden LEO-Betriebskosten wider. CFO Andrew Browne kündigte Pläne an, später im Jahr 2025 in den Ruhestand zu gehen.
- Secured C$2.54 billion government financing for Lightspeed project
- Maintained substantial GEO backlog of C$1.1 billion
- Successfully completed Lightspeed Preliminary Design Review
- Strategic debt reduction through US$849 million cumulative debt repurchases
- Revenue declined 19% to C$571 million in 2024
- Net loss of C$302 million in 2024 compared to profit in 2023
- Adjusted EBITDA decreased 28% to C$384 million
- Projected 53% decline in Adjusted EBITDA for 2025
- Declining North American DTH customer revenues
- Increasing LEO operating expenses projected for 2025
Insights
Telesat's Q4 and full-year 2024 results reveal significant financial challenges with consolidated revenue falling
The company's financial performance is being pressured across multiple fronts: North American DTH customer reductions, maritime and aero market competition from other LEO providers, loss of an Indonesian government contract, reduced U.S. government LEO consulting projects, and divestiture of the Infosat subsidiary. These headwinds have transformed Telesat from profitable to loss-making, with a net loss of
While Telesat secured
The company maintains some financial strengths with a
Telesat's financial results reflect the fundamental transformation occurring in the satellite industry – particularly the disruptive impact of LEO constellations on traditional GEO satellite operators. The company finds itself in the precarious position of experiencing revenue erosion from its legacy GEO business while investing heavily in the Lightspeed LEO constellation that represents its future.
The successful completion of the Preliminary Design Review for Lightspeed is technically significant, indicating the program is progressing through critical engineering milestones. However, Telesat faces intensifying competitive pressure as evidenced by the cited losses in maritime and aero markets specifically attributed to "LEO competition" – likely from established players like Starlink and OneWeb who secured first-mover advantage.
The
Telesat's Lightspeed financing structure – primarily through government loans rather than private capital – reflects the challenging investment climate for new satellite constellations following high-profile struggles at other operators. While securing
The CFO's retirement amid this transition adds leadership uncertainty at a critical juncture when the company must simultaneously manage declining legacy business, execute a capital-intensive new constellation build, and navigate debt refinancing.
OTTAWA, Ontario, March 27, 2025 (GLOBE NEWSWIRE) -- Telesat (NASDAQ and TSX: TSAT), one of the world’s largest and most innovative satellite operators, today announced its financial results for the three and twelve-month periods ended December 31, 2024. All amounts are in Canadian dollars and reported under IFRS® Accounting Standards unless otherwise noted.
“Telesat achieved a great deal in 2024 and I’m pleased with our financial performance and, more importantly in terms of our future, the tremendous progress we made in moving Telesat Lightspeed, our advanced Low Earth Orbit (LEO) satellite program, forward,” commented Dan Goldberg, Telesat’s President and CEO. “Our financial results reflect our continued disciplined execution, delivering revenue and Adjusted EBITDA1 above our 2024 guidance as well as industry-leading Adjusted EBITDA margins1, a substantial GEO backlog2 of
Goldberg added: “Certainly the biggest development for Telesat last year was concluding our agreements with the Governments of Canada and Quebec for
Goldberg noted: “For 2025, our guidance reflects our expectation of continued reduction in revenues from our North American direct-to-home (DTH) satellite video customers due to the full year impact of reductions from the Nimiq 5 renewal secured with Dish last year as well as the Anik F2 and F3 satellites reaching the end of their station-kept lives. In addition, we anticipate reduced revenues from customers in the maritime and, to a lesser extent, aero markets, principally due to LEO competition; from an Indonesian government-supported rural broadband program due to services moving to a new Indonesian satellite; from reduced LEO consulting and demonstration projects for certain U.S. government agencies; and from the impact of the sale of our wholly-owned Infosat subsidiary last fall. At the same time, we expect meaningful increases in Telesat Lightspeed operating expenditures and continued capital investment as we execute the program. The reduction in revenue and increase in operating expenditures are expected to result in a substantial decrease in consolidated Adjusted EBITDA1 relative to 2024, down
Goldberg concluded: “I also want to highlight the decision by Andrew Browne, our CFO, to retire later this year after more than five years at Telesat and over forty years in the computer chip and satellite communications industries. We are initiating a search for a successor and Andrew will ensure a smooth transition and handover. Andrew is a consummate professional and a great colleague and friend. On behalf of the Telesat team and our Board of Directors, I thank Andrew for all of his outstanding contributions and wish him the very best as he readies to take this very well-deserved next step.”
For the year ended December 31, 2024, Telesat reported consolidated revenue of
Operating expenses for the full year 2024 were
Adjusted EBITDA1 for the full-year 2024 was
For the year ended December 31, 2024, Telesat had a net loss of
For the quarter ended December 31, 2024, Telesat reported consolidated revenue of
Operating expenses for the quarter were
Adjusted EBITDA1 for the quarter was
Telesat net loss for the quarter was
Business Highlights
- Government of Canada and Government of Quebec Financing:
- On September 13, 2024, Telesat announced that Telesat LEO Inc. (a wholly-owned unrestricted subsidiary) had completed funding agreements with the Government of Canada and the Government of Quebec for
$2.54 billion in loans to support the Telesat Lightspeed project. - On December 13, 2024, Telesat made the first request for funds under the funding agreement, and the funds were received in January 2025.
- On September 13, 2024, Telesat announced that Telesat LEO Inc. (a wholly-owned unrestricted subsidiary) had completed funding agreements with the Government of Canada and the Government of Quebec for
- Telesat Lightspeed Construction Process:
- On December 4, 2024, Telesat and MDA Space announced the successful completion of the spacecraft Preliminary Design Review, an important milestone in the Telesat Lightspeed program.
- At December 31, 2024:
- Telesat had contracted backlog2 for future services of approximately
$1.1 billion (excluding commitments associated with Telesat Lightspeed). - Fleet utilization was
72% .
- Telesat had contracted backlog2 for future services of approximately
- Debt Repurchase:
- Telesat repurchased US
$262 million of debt for an aggregate price of US$119 million (including US$5 million in accrued interest). Combined with the debt repurchases completed in 2022 and 2023, Telesat has repurchased a cumulative principal amount of US$849 million for an aggregate cost of US$459 million (including US$12 million in accrued interest).
- Telesat repurchased US
- CFO Andrew Browne Retirement:
- Telesat CFO Andrew Browne has announced plans to retire later this year. Telesat is initiating a search process to identify its next Chief Financial Officer. Mr. Browne will continue as Chief Financial Officer until a successor is appointed and will assist with the process to allow for a seamless transition.
2025 Financial Outlook
(assumes an average foreign exchange rate of US
For 2025, Telesat expects full year:
- Revenues to be between
$405 million and$425 million ; - Adjusted EBITDA1 to be between
$170 million and$190 million on a consolidated basis. This reflects LEO operating expenses of between$110 million and$120 million , an increase from 2024 of between$38 million and$48 million ; and - Capital expenditures (including both cash paid and accrued) to be in the range of
$900 million to$1,100 million , virtually all of which is related to Telesat Lightspeed.
Telesat’s annual report on Form 20-F for the year ended December 31, 2024, has been filed with the United States Securities and Exchange Commission (SEC) and the Canadian securities regulatory authorities, and may be accessed on the SEC’s website at www.sec.gov and on the System for Electronic Document Analysis and Retrieval+ (SEDAR) website at www.sedarplus.ca.
Conference Call
Telesat has scheduled a conference call on Thursday, March 27, 2025, at 10:30 a.m. EDT to discuss its financial results for the quarter and year ended December 31, 2024. The call will be hosted by Daniel S. Goldberg, President and Chief Executive Officer, and Andrew Browne, Chief Financial Officer, of Telesat.
Dial-in Instructions:
The toll-free dial-in number for the teleconference is +1 800 952 5114. Callers outside of North America should dial +1 416 406 0743. The access code is 1687079 followed by the number sign (#). Please allow at least 15 minutes prior to the scheduled start time to connect to the teleconference. In the event of technical issues, please dial *0 and advise the conference call operator of the company name (Telesat) and the name of the moderator (James Ratcliffe).
Webcast:
The conference call can also be accessed, as a listen in only, at https://edge.media-server.com/mmc/p/vurym2t3. A replay of the webcast will be archived on Telesat’s website under the tab “Investors”.
Dial-in Audio Replay:
A replay of the teleconference will be available one hour after the end of the call on March 27, 2025 until 11:59 p.m. EDT on April 10, 2025. To access the replay, please call +1 800 408 3053. Callers from outside North America should dial +1 905 694 9451. The access code is 1380193 followed by the number sign (#).
About Telesat
Backed by a legacy of engineering excellence, reliability and industry-leading customer service, Telesat (NASDAQ and TSX: TSAT) is one of the largest and most successful global satellite operators. Telesat works collaboratively with its customers to deliver critical connectivity solutions that tackle the world’s most complex communications challenges, providing powerful advantages that improve their operations and drive profitable growth.
Continuously innovating to meet the connectivity demands of the future, Telesat Lightspeed, the company’s state-of-the-art Low Earth Orbit (LEO) satellite network, has been optimized to meet the rigorous requirements of telecom, government, maritime and aeronautical customers. Telesat Lightspeed will redefine global satellite connectivity with ubiquitous, affordable, high-capacity, secure and resilient links with fibre-like speeds. For updates on Telesat, follow us on LinkedIn, X, or visit www.telesat.com.
Contacts:
Investor Relations
James Ratcliffe
+1 613 748 8424
ir@telesat.com
Forward-Looking Statements Safe Harbor
This news release contains statements that are not based on historical fact, including financial outlook for 2024 and the growth opportunities of Telesat Lightspeed, and are “forward-looking statements’’ and “future-orientated financial performance” within the meaning of the Private Securities Litigation Reform Act of 1995 and Canadian securities laws. When used herein, statements which are not historical in nature, or which contain the words “will,” “expect,” “on track,” “believe,” “opportunity,” or similar expressions, are forward-looking statements. Actual results may differ materially from the expectations expressed or implied in the forward-looking statements and future-orientated financial information as a result of known and unknown risks and uncertainties. Future-orientated financial information contained in this news release about prospective financial performance, financial position, or cash flows are expected to give the reader a better understanding of the potential future performance of Telesat. Readers are cautioned that any such future-orientated financial information and financial outlook contained herein should not be used for purposes other than those disclosed herein. All statements made in this news release are made only as of the date set forth at the beginning of this release. Telesat undertakes no obligation to update the information made in this news release in the event facts or circumstances subsequently change after the date of this news release.
These forward-looking statements and future-orientated financial information are not guarantees of future performance, are based on Telesat’s current expectations, and are subject to a number of risks, uncertainties, assumptions, and other factors, some of which are beyond Telesat control, are difficult to predict, and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. Known risks and uncertainties include but are not limited to: inflation and rising or prolonged elevated interest rates, risks associated with operating satellites and providing satellite services, including satellite construction or launch delays, launch failures, in-orbit failures or impaired satellite performance; the ability to deploy successfully an advanced global LEO satellite constellation, the timing of any such deployment, Telesat’s ability to meet the conditions for advance of the loans under the funding agreements for the constellation, technological hurdles, including Telesat’s and Telesat’s contractors’ development and deployment of the new technologies required to complete the constellation in time to meet Telesat’s schedule, or at all, the availability of services and components from Telesat’s and Telesat’s contractors’ supply chains, competition with other LEO systems, deployed, and to be deployed; risks associated with domestic and foreign government regulation, including access to sufficient orbital spectrum to be able to deliver services effectively and access to sufficient geographic markets in which to sell those services; Telesat’s ability to develop significant commercial and operational capabilities; volatility in exchange rates; and the ability to expand Telesat’s existing satellite utilization. The foregoing list of important factors is not exhaustive. Investors should review the other risk factors discussed in Telesat’s annual report on Form 20-F for the year ended December 31, 2024, that was filed on March 27, 2025, with the United States Securities and Exchange Commission (SEC) and the Canadian securities regulatory authorities at the System for Electronic Document Analysis and Retrieval + (SEDAR+), and may be accessed on the SEC’s website at www.sec.gov and SEDAR’s website at www.sedarplus.ca.
Telesat Corporation Consolidated Statements of Income (Loss) | ||||||||||||||||||||||||
For the periods ended December 31 | ||||||||||||||||||||||||
Three months | Twelve months | |||||||||||||||||||||||
(in thousands of Canadian dollars, except per share amounts) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
Revenue | $ | 127,995 | $ | 165,901 | $ | 571,044 | $ | 704,161 | ||||||||||||||||
Operating expenses | (58,437 | ) | (49,901 | ) | (207,767 | ) | (204,552 | ) | ||||||||||||||||
Depreciation | (27,002 | ) | (42,602 | ) | (127,274 | ) | (182,669 | ) | ||||||||||||||||
Amortization | (2,899 | ) | (3,166 | ) | (11,337 | ) | (13,093 | ) | ||||||||||||||||
Other operating gains (losses), net | (267,185 | ) | (79,900 | ) | (264,931 | ) | 264,999 | |||||||||||||||||
Operating income | (227,528 | ) | (9,668 | ) | (40,265 | ) | 568,846 | |||||||||||||||||
Interest expense | (57,942 | ) | (65,179 | ) | (243,757 | ) | (270,350 | ) | ||||||||||||||||
Gain on repurchase of debt | 8,803 | 8,618 | 202,493 | 230,080 | ||||||||||||||||||||
Interest and other income | (33,719 | ) | 17,768 | 23,314 | 66,532 | |||||||||||||||||||
Gain (loss) on changes in fair value of financial instruments | (12,761 | ) | — | (12,761 | ) | — | ||||||||||||||||||
Gain (loss) on foreign exchange | (177,312 | ) | 77,577 | (244,527 | ) | 77,758 | ||||||||||||||||||
Income (loss) before income taxes | (500,459 | ) | 29,116 | (315,503 | ) | 672,866 | ||||||||||||||||||
Tax (expense) recovery | 53,229 | 10,224 | 13,037 | (89,596 | ) | |||||||||||||||||||
Net income (loss) | $ | (447,230 | ) | $ | 39,340 | $ | (302,466 | ) | $ | 583,270 | ||||||||||||||
Net income (loss) attributable to: | ||||||||||||||||||||||||
Telesat Corporation shareholders | $ | (126,311 | ) | $ | 10,465 | $ | (87,720 | ) | $ | 157,118 | ||||||||||||||
Non-controlling interest | (320,919 | ) | 28,875 | (214,746 | ) | 426,152 | ||||||||||||||||||
$ | (447,230 | ) | $ | 39,340 | $ | (302,466 | ) | $ | 583,270 | |||||||||||||||
Net income (loss) per common share attributable to Telesat Corporation shareholders | ||||||||||||||||||||||||
Basic | $ | (8.97 | ) | $ | 0.77 | $ | (6.29 | ) | $ | 11.71 | ||||||||||||||
Diluted | $ | (8.97 | ) | $ | 0.74 | $ | (6.29 | ) | $ | 11.29 | ||||||||||||||
Total Weighted Average Common Shares Outstanding | ||||||||||||||||||||||||
Basic | 14,083,702 | 13,602,952 | 13,937,443 | 13,417,290 | ||||||||||||||||||||
Diluted | 14,083,702 | 15,679,834 | 13,937,443 | 15,288,221 |
Telesat Corporation Consolidated Balance Sheets | |||||||
(in thousands of Canadian dollars) | December 31, 2024 | December 31, 2023 | |||||
Assets | |||||||
Cash and cash equivalents | $ | 552,064 | $ | 1,669,089 | |||
Trade and other receivables | 158,930 | 78,289 | |||||
Other current financial assets | 565 | 631 | |||||
Current income tax recoverable | 29,253 | 16,510 | |||||
Prepaid expenses and other current assets | 280,460 | 52,169 | |||||
Total current assets | 1,021,272 | 1,816,688 | |||||
Satellites, property and other equipment | 2,277,143 | 1,260,298 | |||||
Deferred tax assets | 3,059 | 2,954 | |||||
Other long-term financial assets | 9,767 | 6,633 | |||||
Long-term income tax recoverable | 6,993 | 7,497 | |||||
Other long-term assets | 516,507 | 79,939 | |||||
Intangible assets | 497,466 | 692,756 | |||||
Goodwill | 2,612,972 | 2,446,603 | |||||
Total assets | $ | 6,945,179 | $ | 6,313,368 | |||
Liabilities | |||||||
Trade and other payables | $ | 158,276 | $ | 43,626 | |||
Other current financial liabilities | 26,483 | 29,061 | |||||
Income taxes payable | 5,913 | 1,921 | |||||
Other current liabilities | 65,906 | 63,119 | |||||
Total current liabilities | 256,578 | 137,727 | |||||
Long-term indebtedness | 3,096,615 | 3,197,019 | |||||
Deferred tax liabilities | 175,544 | 235,247 | |||||
Other long-term financial liabilities | 630,556 | 14,938 | |||||
Other long-term liabilities | 289,181 | 329,454 | |||||
Total liabilities | 4,448,474 | 3,914,385 | |||||
Shareholders’ Equity | |||||||
Share capital | 59,082 | 51,252 | |||||
Accumulated earnings | 467,333 | 534,058 | |||||
Reserves | 183,865 | 76,608 | |||||
Total Telesat Corporation shareholders’ equity | 710,280 | 661,918 | |||||
Non-controlling interest | 1,786,425 | 1,737,065 | |||||
Total shareholders’ equity | 2,496,705 | 2,398,983 | |||||
Total liabilities and shareholders’ equity | $ | 6,945,179 | $ | 6,313,368 |
Telesat Corporation Consolidated Statements of Cash Flows | ||||||||||
For the years ended December 31 | ||||||||||
(in thousands of Canadian dollars) | 2024 | 2023 | ||||||||
Cash flows from operating activities | ||||||||||
Net income (loss) | $ | (302,466 | ) | $ | 583,270 | |||||
Adjustments to reconcile net income (loss) to cash flows from operating activities | ||||||||||
Depreciation | 127,274 | 182,669 | ||||||||
Amortization | 11,337 | 13,093 | ||||||||
Tax expense (recovery) | (13,037 | ) | 89,596 | |||||||
Interest expense | 243,757 | 270,350 | ||||||||
Interest income | (65,996 | ) | (63,838 | ) | ||||||
(Gain) loss on foreign exchange | 244,527 | (77,758 | ) | |||||||
(Gain) loss on changes in fair value of financial instruments | 12,761 | — | ||||||||
Share-based compensation | 17,557 | 33,015 | ||||||||
(Gain) loss on disposal of assets | 534 | (59 | ) | |||||||
Gain on disposal of subsidiaries | (2,620 | ) | — | |||||||
Gain on repurchase of debt | (202,493 | ) | (230,080 | ) | ||||||
Impairment | 267,017 | 79,740 | ||||||||
Deferred revenue amortization | (58,044 | ) | (59,337 | ) | ||||||
Pension expense | 5,648 | 5,674 | ||||||||
C-band clearing income | — | (344,892 | ) | |||||||
Non-cash other income (expense) | 33,902 | — | ||||||||
Other | 7,511 | 2,958 | ||||||||
Income taxes paid, net of income taxes received | (60,510 | ) | (66,841 | ) | ||||||
Interest paid, net of interest received | (161,595 | ) | (209,261 | ) | ||||||
Government grant received | 2,520 | 972 | ||||||||
Operating assets and liabilities | (45,120 | ) | (39,212 | ) | ||||||
Net cash from operating activities | 62,464 | 170,059 | ||||||||
Cash flows (used in) generated from investing activities | ||||||||||
Cash payments related to satellite programs | (1,045,671 | ) | (83,319 | ) | ||||||
Cash payments related to property and other equipment | (64,804 | ) | (42,920 | ) | ||||||
Purchase of intangible assets | (52 | ) | (13,267 | ) | ||||||
Net proceeds from disposal of subsidiaries | 3,613 | — | ||||||||
Government grant received | 15,359 | 117 | ||||||||
C-band clearing proceeds | — | 351,438 | ||||||||
Net cash (used in) generated from investing activities | (1,091,555 | ) | 212,049 | |||||||
Cash flows (used in) generated from financing activities | ||||||||||
Repurchase of indebtedness | (155,903 | ) | (344,014 | ) | ||||||
Payments of principal on lease liabilities | (2,422 | ) | (2,171 | ) | ||||||
Satellite performance incentive payments | (4,572 | ) | (6,385 | ) | ||||||
Proceeds from exercise of stock options | 426 | 27 | ||||||||
Tax withholdings on settlement of restricted share units | (7,732 | ) | (3,198 | ) | ||||||
Net cash (used in) generated from financing activities | (170,203 | ) | (355,741 | ) | ||||||
Effect of changes in exchange rates on cash and cash equivalents | 82,269 | (35,070 | ) | |||||||
Changes in cash and cash equivalents | (1,117,025 | ) | (8,703 | ) | ||||||
Cash and cash equivalents, beginning of year | 1,669,089 | 1,677,792 | ||||||||
Cash and cash equivalents, end of year | $ | 552,064 | $ | 1,669,089 |
Telesat’s Adjusted EBITDA margin(1):
The following table provides a quantitative reconciliation of net income to Adjusted EBITDA and Adjusted EBITDA margin, each of which are non-IFRS Accounting Standards measures.
Three Months Ended December 31, | Twelve Months Ended December 31, | |||||||||||||||
(in thousands of Canadian dollars) (unaudited) | 2024 | 2023 | 2024 | 2023 | ||||||||||||
Net income (loss) | $ | (447,230 | ) | $ | 39,340 | $ | (302,466 | ) | $ | 583,270 | ||||||
Tax expense (recovery) | (53,229 | ) | (10,224 | ) | (13,037 | ) | 89,596 | |||||||||
(Gain) loss on changes in fair value of financial instruments | 12,761 | — | 12,761 | — | ||||||||||||
(Gain) loss on foreign exchange | 177,312 | (77,577 | ) | 244,527 | (77,758 | ) | ||||||||||
Interest and other income | 33,719 | (17,768 | ) | (23,314 | ) | (66,532 | ) | |||||||||
Interest expense | 57,942 | 65,179 | 243,757 | 270,350 | ||||||||||||
Gain on repurchase of debt | (8,803 | ) | (8,618 | ) | (202,493 | ) | (230,080 | ) | ||||||||
Depreciation | 27,002 | 42,602 | 127,274 | 182,669 | ||||||||||||
Amortization | 2,899 | 3,166 | 11,337 | 13,093 | ||||||||||||
Other operating (gains) losses, net | 267,185 | 79,900 | 264,931 | (264,999 | ) | |||||||||||
Non-recurring compensation expenses(3) | 838 | 385 | 2,903 | 1,078 | ||||||||||||
Non-cash expense related to share-based compensation | 3,053 | 6,949 | 17,557 | 33,015 | ||||||||||||
Adjusted EBITDA | $ | 73,449 | $ | 123,334 | $ | 383,737 | $ | 533,702 | ||||||||
Revenue | $ | 127,995 | $ | 165,901 | $ | 571,044 | $ | 704,161 | ||||||||
Adjusted EBITDA Margin | 57.4 | % | 74.3 | % | 67.2 | % | 75.8 | % | ||||||||
End Notes
1 Non-IFRS Accounting Standards Measures – Adjusted EBITDA and Adjusted EBITDA margin are non-IFRS Accounting Standards measures. EBITDA is defined as “Earnings Before Interest, Taxes, Depreciation and Amortization.” Adjusted EBITDA is used to measure Telesat’s financial performance. Adjusted EBITDA is defined as operating income (less certain operating expenses such as share-based compensation expenses and unusual and non-recurring items, including restructuring related expenses) before interest expense, taxes, depreciation and amortization. Adjusted EBITDA margin is used to measure Telesat’s operating performance. Adjusted EBITDA margin is defined as the ratio of Adjusted EBITDA to revenue.
Adjusted EBITDA and Adjusted EBITDA margin are not standardized financial measures under IFRS Accounting Standards and might not be comparable to similar financial measures disclosed by other issuers. Adjusted EBITDA allows investors and Telesat to compare Telesat’s operating results with that of competitors exclusive of depreciation and amortization, interest and investment income, interest expense, taxes and certain other expenses. Financial results of competitors in the satellite services industry have significant variations that can result from timing of capital expenditures, the amount of intangible assets recorded, the differences in assets’ lives, the timing and amount of investments, the effects of other income (expense), and unusual and non-recurring items. The use of Adjusted EBITDA assists investors and Telesat to compare operating results exclusive of these items. Competitors in the satellite services industry have significantly different capital structures. Telesat believes that the use of Adjusted EBITDA improves comparability of performance by excluding interest expense.
Telesat believes that the use of Adjusted EBITDA and the Adjusted EBITDA margin along with IFRS Accounting Standards measures enhances the understanding of our operating results and is useful to investors and us in comparing performance with competitors, estimating enterprise value and making investment decisions. Adjusted EBITDA and Adjusted EBITDA margin as used here may not be the same as similarly titled measures reported by competitors. Adjusted EBITDA and Adjusted EBITDA margin should be used in conjunction with IFRS Accounting Standards measures and are not presented as a substitute for cash flows from operations as a measure of our liquidity or as a substitute for net income (loss) as an indicator of our operating performance.
2 Remaining performance obligations, which Telesat refers to as contracted revenue backlog (‘backlog’), represents Telesat’s expected future revenue from existing service contracts (without discounting for present value) including any deferred revenue that Telesat will recognize in the future in respect of cash already received. The calculation of the backlog reflects the revenue recognition policies adopted under IFRS 15. The majority of Telesat’s contracted revenue backlog is generated from contractual agreements for satellite capacity.
3 Includes severance payments and special compensation and benefits for executives and employees.
