Telesat turns Q1 profit despite 9% revenue dip as pandemic plays havoc with key customers

Dan Goldberg
Dan Goldberg

Satellite equipment provider Telesat said Friday its revenues fell nine per cent year-over-year in the first quarter as key customers in the commercial airline and cruise ship industries continued to be hit hard by the pandemic.

The Ottawa-based company reported revenues of $190 million for the three-month period ending March 31, down from $208.7 million a year earlier. With foreign exchange rate fluctuations factored in, revenues declined by six per cent, or $13 million.

Still, Telesat managed to turn a net profit of $42 million in the quarter after posting a loss of $278 million in the same period in 2020. The company attributed the turnaround mainly to non-cash gains on foreign exchange after translating its U.S.-dollar-denominated debt into Canadian currency.

OBJ360 (Sponsored)

Telesat president and CEO Dan Goldberg touted the firm’s $2.5-billion order backlog, saying the company continued to generate “strong cash flows.” 

LEO satellite project

He also said Telesat made “significant progress” on its multibillion-dollar Lightspeed low-Earth-orbit satellite constellation in the first quarter, signing major deals with key suppliers Thales Alenia Space and MDA while announcing plans to raise US$500 million in a recent secured note offering

Goldberg said the firm expects to finalize financing for the project in the coming months. The satellite network’s operations hub will be headquartered in Gatineau at a facility that’s expected to employ nearly 300 people. 

“Telesat Lightspeed will give Telesat and our customers a decisive competitive advantage in serving the enterprise broadband connectivity market, helping to bridge the digital divide around the world and fueling our growth for years to come,” he said in a statement.

Telesat has said it plans to go public on the Nasdaq later this year and hopes to bring in up to US$344 million through auctioning off its portion of the “C-band” radio spectrum in the U.S. to wireless carriers that will repurpose it for 5G networks.

Get our email newsletters

Get up-to-date news about the companies, people and issues that impact businesses in Ottawa and beyond.

By signing up you agree to our Terms of Use and Privacy Policy. You may unsubscribe at any time.