Telesat struggles, but Lightspeed coming
May 13, 2024
By Chris Forrester
Ottawa-based geostationary satellite operator Telesat reported an underwhelming set of Q1 numbers. Every key metric showed a decline in revenues. Overall revenue was down a worrying 17 per cent year-on-year to C$152 million (€103.1m) for the three months to March 31st.
“The decrease was primarily due to a reduction of services and lower rate on the renewal of a long-term agreement with a North American DTH customer as well as lower revenue from certain mobility and Latin American customers and lower equipment sales to Canadian Government customers,” said the company.
Poor as its numbers were there’s light at the end of the tunnel. CEO Dan Goldberg told analysts that Lightspeed, its proposed low Earth orbiting (LEO) 198-craft fleet now under construction, would make a material difference.
“We believe Lightspeed will revolutionise broadband connectivity for enterprise and government users and represents a highly compelling growth and value creation opportunity for Telesat and its stakeholders,” he said.
Telesat reminded analysts that the final approvals for part of the scheme’s funding was now in place for – at least – 156 of the satellites, and which is enough to provide a full service.
The cash, C$1.25 billion plus investments, means that Telesat has C$1.76 billion ready to fund the build. Lightspeed’s prime contractor is Ontario-based MDA Space.
Other key metrics show that Telesat’s backlog is C$1.2 billion and fleet utilisation is just 77 per cent (down from 85 per cent just three months earlier).
“The biggest [decline] has been in the cruise space, and in particular for us in the Caribbean,” Goldberg said. “We have a meaningful amount of capacity there,” with the company adding that Telesat was losing cruise contracts to Elon Musk’s Starlink.
The current plan for Lightspeed is for launches to start in 2026, and for global service to begin in 2027. Telesat/Lightspeed has a 14-launch agreement with SpaceX.