Telesat announced its financial results for the three month and one year periods ended December 31, 2021.
Article continues below
All amounts are in Canadian dollars and reported under International Financial Reporting Standards (“IFRS”) unless otherwise noted.
For the year ended December 31, 2021, Telesat reported consolidated revenue of $758 million, a decrease of 8% ($62 million) compared to the same period in 2020. When adjusted for changes in foreign exchange rates, revenue declined 4% ($32 million) compared to 2020.
The revenue decrease was primarily due to a reduction of service for one of Telesat’s North American direct-to-home customers, the reduction or non-renewal of certain services in the enterprise segment, including as a result of the full-year effect of contract restructurings in 2020 for a mobility customer as a result of COVID-19, and lower consulting revenue.
The revenue decline was partially offset by an increase in revenue associated with short-term services provided to another satellite operator in 2021, which had not occurred in 2020, as well as increased services provided to customers in the mobility market as it began to recover from the impact of COVID-19.
Operating expenses for full year 2021 were $234 million, an increase of $53 million from 2020. When adjusted for changes in foreign exchange rates, operating expenses increased by $59 million from 2020. The increase was principally due to higher non-cash share-based compensation combined with higher wages due to the hiring of additional employees, primarily to support the Telesat Lightspeed program. This was partially offset by higher capitalized engineering costs.
Adjusted EBITDA1 for full year 2021 was $603 million, a decrease of 8% ($50 million) or, when adjusted for foreign exchange rates, a decrease of 4% ($25 million). The Adjusted EBITDA margin1 was 79.6%, unchanged from 2020.
For the year ended December 31, 2021, net income was $158 million, compared to $246 million for 2020. The decline was the result of lower revenues, higher (mostly non-cash) operating expenses, and an increase in tax expense, driven by lower deferred tax recovery in 2021, partially offset by recognition of Phase I accelerated clearing payments for repurposing of U.S. C-band spectrum.
For the quarter ended December 31, 2021, Telesat reported consolidated revenue of $187 million, a decrease of 7% ($14 million) compared to the same period in 2020. When adjusted for changes in foreign exchange rates, revenue declined 5% ($9 million) compared to 2020.
The revenue decrease was primarily due to lower equipment sales from certain government customers, the reduction or non-renewal of certain services in the enterprise segment, and a reduction of services for one of Telesat’s North American direct-to-home customers. ■
Predominant upper-level ridging stretching from the Southwest to the southern High Plains will allow for another day of record-breaking heat across parts of Nevada and Arizona today.