Telesat Holdings Inc. (“Telesat”) today announced its financial results for the three month period ended March 31, 2015. All amounts are in Canadian dollars and are reported under International Financial Reporting Standards (“IFRS”) unless otherwise noted.
For the quarter ended March 31, 2015, Telesat reported consolidated revenues of $229 million, a decrease of approximately 5% ($13 million) compared to the same period in 2014. During the quarter, the U.S. dollar was approximately 12% stronger than it was during the first quarter of 2014, and as a result, there was a favorable impact on the conversion of U.S. dollar denominated revenues. When adjusted for foreign exchange rate changes, revenue decreased by 10% ($25 million) compared to the same period in 2014. The decrease was primarily due to revenues from short-term services provided to other satellite operators in the first quarter of 2014 which did not recur in the first quarter of 2015.
Operating expenses of $45 million for the quarter were 4% ($2 million) lower than the same period in 2014 or 9% ($4 million) lower when taking into account changes in foreign exchange rates. This reduction was primarily due to lower cost of sales in 2015. Adjusted EBITDA1 for the quarter was $186 million, a decrease of 6% ($12 million) compared to the same period in 2014 and a decrease of 11% ($22 million) when adjusted for foreign exchange rate changes. The Adjusted EBITDA margin1 was 81% for the first quarter of 2015 compared to 82% for the same period in 2014.
Telesat’s net loss for the quarter was $154 million compared to net loss of $28 million for the quarter ended March 31, 2014. Results were negatively impacted by a non-cash loss on foreign exchange arising from the translation of Telesat’s U.S. dollar denominated debt into Canadian dollars as well as lower operating income. The losses were partially mitigated by a higher gain on changes in the fair value of financial instruments and by lower interest expense in the first quarter of 2015.
“Our first quarter revenue and EBITDA were lower than the same period last year principally as a result of the fact that certain short-term satellite services we provided to other satellite operators in 2014 did not recur in the first quarter of this year,” commented Dan Goldberg, Telesat’s President and CEO. “Despite this reduction, our Adjusted EBITDA margin1 was essentially stable given our continued operating discipline. Looking ahead, the Telstar 12 VANTAGE satellite remains on schedule, and we anticipate its launch toward the end of this year. Our satellite expansion plans combined with our industry-leading contractual backlog provides visibility into the stability of our future revenue and cash flow and positions us well for future growth.”
Business Highlights at March 31, 2015:
– Telesat had contracted backlog for future services of approximately $4.6 billion.
– Fleet utilization was 93% for Telesat’s North American fleet2 and 80% for Telesat’s international fleet.
