Maxar Technologies Reports First Quarter 2019 Results

WESTMINSTER, Colo. — (BUSINESS WIRE) — May 9, 2019 — Maxar Technologies Inc. (“Maxar” or the “Company”) (NYSE: MAXR) (TSX: MAXR), a global technology innovator powering the new space economy, today reported financial results for the quarter ended March 31, 2019. All dollar amounts in this press release are expressed in U.S. dollars.

Key points from the quarter include:

  • Consolidated revenues of $504 million
  • Net loss of $0.99 per share
  • Adjusted EBITDA1 of $117 million and Adjusted EBITDA1 margin of 23 percent
  • Quarterly dividend of $0.01
1  

This is a non-GAAP financial measure. Refer to section “Non-GAAP Financial Measures” in this earnings release.

 

“We remain focused on our near-term priorities to position Maxar for sustained top and bottom-line growth. We are working on reducing debt and leverage levels, re-engineering the satellite business based out of Palo Alto, positioning our Imagery, Services, and MDA businesses for long-term growth, and creating a leaner, more agile organization with a reduced cost structure,” stated Dan Jablonsky, President and Chief Executive Officer.

Jablonsky continued, “This quarter, our Palo Alto satellite business experienced quarter-over-quarter profit improvement, Imagery signed on several new subscription-based customers, Services captured a number of new wins, and MDA garnered its first contract for work on the Canadian Surface Combatant program. We continued to advance our organizational restructuring to strengthen our financial position and drive long-term value for our shareholders and customers.”

“First quarter results were consistent with expectations,” stated Biggs Porter, Chief Financial Officer. “Cash flows and capital expenditures reflect the timing of interest and milestone payments and the ramp of the WorldView Legion program. After the quarter end, our insurance carriers accepted the Company’s $183 million claim for loss arising from the WorldView-4 satellite on-orbit failure and we have collected $154 million in proceeds. We expect a full recovery of the remaining balance by the end of the second quarter.”

Consolidated revenues for the first quarter of 2019 were $504 million compared to $557 million for the same period of last year. The decrease in revenues was primarily driven by the Space Systems segment given lower GEO Comsat revenues and the expected wind-down of work on the multi-year RCM project, and a decrease in the Imagery Segment given the loss of the Company’s WorldView-4 satellite.

For the quarter ended March 31, 2019, net loss of $59 million compared to net income of $15 million in the comparative period of 2018. The decrease is primarily driven by a lower tax benefit, higher restructuring costs, and lower Adjusted EBITDA from the Imagery segment given the loss of the Company’s WorldView-4 satellite.

For the first quarter of 2019, Adjusted EBITDA was $117 million and Adjusted EBITDA as a percentage of consolidated revenues (“Adjusted EBITDA margin percentage”) was 23.2%. This is compared to Adjusted EBITDA of $151 million and Adjusted EBITDA margin percentage of 27.1% for the first quarter of 2018. The decline was driven largely by lower Adjusted EBITDA from the Imagery segment given the loss of the Company’s WorldView-4 satellite and lower revenues and profits in the Space Systems segment.

The Company had total order backlog of $1.9 billion as of March 31, 2019 compared to $2.4 billion as at December 31, 2018. Backlog decreased primarily due to declines in backlog in our Space Systems and Imagery segments. Space Systems backlog decreased primarily as a result of revenue recognized on existing contracts and no new satellite awards during the quarter. Imagery backlog declined primarily due to the recognition of EnhancedView revenue during the quarter and the loss of our WorldView-4 satellite. Unfunded contract options as of March 31, 2019 totaled $1.3 billion vs. $1.2 billion in 2018. The increase in unfunded contract options was primarily driven by awards in our Services segment.

Financial Highlights

In addition to results reported in accordance with U.S. GAAP, the Company uses certain non-GAAP financial measures as supplemental indicators of its financial and operating performance. These non-GAAP financial measures include EBITDA and Adjusted EBITDA . The Company believes these supplementary financial measures reflect the Company’s ongoing business in a manner that allows for meaningful period-to-period comparisons and analysis of trends in its business.

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