Maxar Technologies Ltd. (“Maxar” or the “Company”, formerly MacDonald, Dettwiler and Associates Ltd.), (NYSE and TSX: MAXR), a leading global provider of advanced space technology solutions for commercial and government markets, today reported financial results for the third quarter ended September 30, 2017. Unless otherwise indicated, all dollar amounts are expressed in Canadian dollars.
Highlights from the quarter include:
- Consolidated revenues of $421.3 million
- Operating EBITDA of $89.9 million and margins of 21.3 percent
- Operating earnings of $44.9 million and operating earnings per share of $1.23
- Net earnings of $14.9 million and net earnings per share of $0.41
- Completed the acquisition of DigitalGlobe, changed the Company’s name to Maxar Technologies Ltd., and dual-listed its stock on the NYSE as MAXR
“With the recent closing of the DigitalGlobe transaction, Maxar Technologies is now a unique, vertically-integrated space and geospatial intelligence powerhouse with end-to-end solutions expertise for commercial and government customers,” stated Howard L. Lance, President and Chief Executive Officer. “We believe Maxar will be a powerful force for value creation through its industry-leading market position, increased scale and diversified revenue base, cost synergies and cash flow potential. We have the opportunity to drive above-industry growth across the U.S. government, international government and commercial customer segments.”
“Our DigitalGlobe business unit delivered strong third quarter results with solid revenue growth across the business, and adjusted EBITDA in line with expectations,” continued Mr. Lance. “The addition of DigitalGlobe, and the combination of its Services business with MDA’s to form our Radiant Solutions business, contributes significant advanced geospatial information and insight capabilities to Maxar, as well as adding to our growth prospects going forward.”
On October 5, 2017, the Company and DigitalGlobe, Inc. (“DigitalGlobe”) completed their previously announced merger transaction. Due to the timing of the closing of the transaction, DigitalGlobe financial results are not included in the Maxar third quarter 2017 financial results. Selected DigitalGlobe financial results are included in this release on a US dollar and US GAAP reporting basis.
In addition, selected pro forma financial results that include DigitalGlobe for the third quarter of 2017 along with historical quarterly results are included in this release as Table 1 and Table 2. Please refer to the Company’s filings for additional information regarding the pro forma calculations and adjustments.
Consolidated revenues for the third quarter of 2017 were $421.3 million compared to $495.9 million for the same period of last year. Revenues from the Communications segment were $256.0 million compared to $354.8 million for the same period of last year on a lower level of construction activity on geostationary communication satellites. Revenues from the Surveillance and Intelligence segment increased to $165.3 million compared to $141.1 million for the third quarter of 2016 on higher revenues from contracts with U.S. government customers to perform advanced design studies and supply spacecraft for scientific research and development missions.
Operating EBITDA for the third quarter of 2017 was $89.9 million compared to $84.3 million for the same period of last year. The Communications segment contributed operating EBITDA of $43.0 million (Q3 2016 – $58.2 million) and the Surveillance and Intelligence segment contributed operating EBITDA of $46.9 million (Q3 2016 – $26.1 million). In the third quarter of 2016, operating EBITDA for the Surveillance and Intelligence segment included a contract loss provision of $10.0 million on a robotics program.
Operating earnings for the third quarter of 2017 were $44.9 million, or $1.23 per share, compared to $46.1 million, or $1.26 per share, for the same period of last year. The decrease reflected the addition of non-cash interest expense from the orbital securitization liability and a higher effective income tax rate on operating earnings.
Net earnings under IFRS for the third quarter of 2017 were $14.9 million compared to $41.8 million for the same period of last year. Net earnings this quarter were impacted by the inclusion and variability of certain large, non-operational items, including share-based compensation expense and legal and other professional fees related to the acquisition of DigitalGlobe.
For the nine months ended September 30, 2017, consolidated revenues were $1,419.3 million compared to $1,560.9 million for the same period of 2016 as higher activity levels in the Surveillance and Intelligence segment partially offset lower revenues from the Communications segment. Operating EBITDA and related margin percentage was $273.4 million and 19.3% compared to $277.9 million and 17.8% for the same period of last year. Operating earnings were $136.8 million ($3.75 per share) compared to $159.2 million ($4.36 per share) for the corresponding period of 2016. Net earnings for the first nine months of 2017 were $46.6 million compared to $107.7 million for the same period of 2016.
The Company had total funded order backlog of $2.3 billion as at September 30, 2017 compared to $2.0 billion as at June 30, 2017.
The Company has declared a quarterly dividend of $0.37 per common share payable on December 29, 2017 to shareholders of record at the close of business on December 15, 2017.
