Telesat Reviews Outcomes for the Quarter and Six Months Ended June 30, 2024

OTTAWA, CANADA – August 14, 2024 –Telesat (NASDAQ and TSX: TSAT), one of many world’s largest and most progressive satellite tv for pc operators, immediately introduced its monetary outcomes for the three and six-month durations ended June 30, 2024. All quantities are in Canadian {dollars} and reported below Worldwide Monetary Reporting Requirements (IFRS) except in any other case famous.

“I’m happy with our monetary and working efficiency for the second quarter,” commented Dan Goldberg, Telesat’s President and CEO. “We stay on observe to satisfy our 2024 steerage and, because of our continued disciplined execution, delivered industry-leading Adjusted EBITDA margins¹, excessive capability utilization, a considerable contractual backlog² of $1.1 billion, and a money steadiness of $1.4 billion.”

 

Goldberg added: “Our focus this yr stays twofold. First, in our geostationary actions, maximize our Adjusted EBITDA¹ and money circulate by in search of to mitigate anticipated income declines and rigorously managing our legacy price construction. Second, transfer ahead expeditiously on implementing and deploying Telesat Lightspeed as we full the definitive documentation on the Authorities of Canada and Authorities of Quebec funding for this system. We consider Telesat Lightspeed, our state-of-the-art Low Earth Orbit (LEO) world broadband constellation, will revolutionize broadband connectivity for enterprise and authorities customers and represents a extremely compelling progress and worth creation alternative for Telesat and its stakeholders.”

 

For the quarter ended June 30, 2024, Telesat reported consolidated income of $152 million, a lower of 15% ($27 million) in comparison with the identical interval in 2023 and consistent with our expectations. When adjusted for modifications in international change charges, income declined 16% ($29 million) in comparison with 2023. The lower was primarily attributable to a discount of providers and decrease fee on the renewal of a long-term settlement with a North American direct-to-home tv buyer in addition to decrease income from sure mobility and Latin American clients.

 

Working bills for the quarter have been $56 million, a rise of $5 million from 2023. The affect from international change was minimal. The rise was primarily attributable to increased wages and advantages, dangerous debt expense, and prices related to consulting contracts, partially offset by decrease non-cash share-based compensation and better capitalized engineering related to Telesat Lightspeed.

 

Adjusted EBITDA¹ for the quarter was $103 million, a lower of 25% ($35 million) or 27% ($37 million) when adjusted for international change charges. The Adjusted EBITDA margin¹ was 67.8%, in comparison with 77.1% in the identical interval in 2023.

 

Telesat web earnings for the quarter was $129 million in comparison with web earnings of $519 million for a similar interval within the prior yr. The change was primarily as a result of recognition of C-band clearing earnings in 2023, together with a loss related to the affect of modifications in international change charges in the course of the quarter on the worth of our US greenback denominated debt, in contrast with a achieve in the identical interval in 2023.

 

For the six-month interval ended June 30, 2024, Telesat reported consolidated income of $305 million, a lower of 16% ($59 million) in comparison with the identical interval in 2023 and consistent with our expectations.When adjusted for modifications in international change charges, income declined 17% ($60 million) in comparison with 2023. The lower was primarily attributable to a discount of providers and decrease fee on the renewal of a long-term settlement with a North American direct-to-home tv buyer in addition to decrease income from sure mobility and Latin American clients and decrease gear gross sales to Canadian Authorities clients.     

 

Working bills for the six-month interval have been $103 million, a lower of $2 million from 2023. The affect from international change was minimal. The lower was primarily attributable to decrease non-cash share-based compensation and better capitalized engineering related to Telesat Lightspeed, partially offset by increased wages and advantages, dangerous debt expense, and prices related to consulting contracts.

 

Adjusted EBITDA¹ for the six-month interval was $214 million, a lower of 23% ($64 million) or 24% ($66 million) when adjusted for international change charges.  The Adjusted EBITDA margin¹ was 70.3%, in comparison with 76.4% in the identical interval in 2023.

 

For the six months ended June 30, 2024, Telesat’s web earnings was $77 million in comparison with web earnings of $547 million for a similar interval within the prior yr. The change was primarily as a result of recognition of C-band clearing earnings in 2023, together with a loss related to the affect of modifications in international change charges in the course of the interval on the worth of our US greenback denominated debt, in contrast with a achieve in the identical interval in 2023.

 

 

Enterprise Highlights

 

• At June 30, 2024:
  • Telesat had contracted backlog² for future providers of roughly $1.1 billion (excluding income commitments related to Telesat Lightspeed).
  • Fleet utilization was 75%.

 

 

• Debt Repurchase:
  • So far in 2024, Telesat has repurchased US$262 million of debt for an combination value of US$119.5 million (together with US$5.5 million in accrued curiosity). This features a principal quantity of US$42.5 million repurchased for US$20.9 million (together with US$0.7 million in accrued curiosity) subsequent to the tip of the second quarter.
  • Mixed with the debt repurchases accomplished in 2022 and 2023, Telesat has repurchased a cumulative principal quantity of US$849 million for an combination price of US$458.9 million (together with US$12.2 million in accrued curiosity).

 

 

2024 Monetary Outlook

(assumes a median international change fee of US$1=C$1.35)

For 2024, Telesat continues to anticipate full yr:

• Revenues to be between $545 million and $565 million;
• Adjusted EBITDA¹ to be between $340 million and $360 million, which displays Telesat Lightspeed working bills of between $80 million and $90 million; and
• Money flows utilized in investing actions to be within the vary of $1,000 million to $1,400 million, which is sort of all associated to anticipated Telesat Lightspeed capital expenditures.

Telesat’s quarterly report on Kind 6-Okay for the quarter ended June 30, 2024 has been filed with the US Securities and Change Fee (SEC) and the Canadian securities regulatory authorities, and could also be accessed on the SEC’s web site at www.sec.gov and on the System for Digital Doc Evaluation and Retrieval + (SEDAR+) web site at www.sedarplus.ca.

 

Convention Name

 

Telesat has scheduled a convention name on Wednesday, August 14, 2024, at 10:30 a.m. ET to debate its monetary outcomes for the Quarter ended June 30, 2024. The decision can be hosted by Daniel S. Goldberg, President and Chief Govt Officer, and Andrew Browne, Chief Monetary Officer, of Telesat.

 

Dial-in Directions:

 

The toll-free dial-in quantity for the teleconference is +1 800 806 5484. Callers exterior of North America ought to dial +1 416 340 2217. The entry code is 6484355 adopted by the quantity signal (#). Please permit not less than quarter-hour previous to the scheduled begin time to hook up with the teleconference. Within the occasion of technical points, please dial *0 and advise the convention name operator of the corporate title (Telesat) and the title of the moderator (James Ratcliffe).

Webcast:

The convention name can be accessed, as a pay attention in solely, at https://edge.media-server.com/mmc/p/ytrh4nae. A replay of the webcast can be archived on Telesat’s web site below the tab “Buyers”. 

Dial-in Audio Replay:

A replay of the teleconference can be out there one hour after the tip of the decision on August 14, 2024 till 11:59 p.m. ET on August 28, 2024. To entry the replay, please name +1 800 408 3053. Callers from exterior North America ought to dial +1 905 694 9451. The entry code is 7879436 adopted by the quantity signal (#).

 

About Telesat

Backed by a legacy of engineering excellence, reliability and industry-leading customer support, Telesat (NASDAQ and TSX: TSAT) is without doubt one of the largest and most profitable world satellite tv for pc operators. Telesat works collaboratively with its clients to ship important connectivity options that deal with the world’s most complicated communications challenges, offering highly effective benefits that enhance their operations and drive worthwhile progress.

Constantly innovating to satisfy the connectivity calls for of the longer term, Telesat Lightspeed, the corporate’s state-of-the-art Low Earth Orbit (LEO) satellite tv for pc community, has been optimized to satisfy the rigorous necessities of telecom, authorities, maritime and aeronautical clients. Telesat Lightspeed will redefine world satellite tv for pc connectivity with ubiquitous, reasonably priced, high-capacity hyperlinks with fibre-like speeds. For updates on Telesat, comply with us on X, LinkedIn, or go to www.telesat.com.