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Telesat Grows Revenue and Adjusted EBITDA in First Quarter of 2011


May 5, 2011


Telesat Holdings Inc. announced its financial results for the three month period ended March 31, 2011. All amounts are in Canadian dollars, and are reported under International Financial Reporting Standards (“IFRS”) unless otherwise noted.


For the three month period ended March 31, 2011, Telesat reported consolidated revenues of $203 million, an increase of approximately 2% ($3.5 million) compared to the same period in 2010.  When adjusted for foreign exchange rate changes over the period, revenue increased by 4% compared to the same period in 2010.  Adjusted EBITDA for the first quarter of 2011 was $157 million, an increase of 6% ($9.5 million) compared to the first quarter 2010 and an increase of 9% when adjusted for foreign exchange rate changes.  The Adjusted EBITDA margin for the first quarter was 77%, compared to 74% in 2010.  Telesat reported net income of $115 million in the first quarter compared to net income of $80 million for the same period in 2010.  The higher net income is mainly due to higher revenues, lower operating expenses (approximately $10 million of net increase) and positive changes in the fair value of financial instruments, offset by lower gain on foreign exchange (approximately $20 million of net increase) and lower  interest expense (approximately $10 million).  During the first quarter of 2011, the foreign exchange gain related to the conversion of the U.S. dollar denominated debt and the gain on financial instruments resulted in total non-cash gains of $93 million, compared to a non-cash gain of $72 million for the same period in 2010.


“I am very pleased with our performance in the first quarter of this year,” commented Dan Goldberg, Telesat’s President and CEO.  “Compared to the same period last year, and adjusting for foreign exchange movements, we experienced continued growth in revenue, a meaningful reduction in expenses, and significant improvement in Adjusted EBITDA and our Adjusted EBITDA margin.  We also continued to lay the foundation for our future growth, closing an agreement last quarter with Loral to acquire the Canadian payload of the ViaSat-1 satellite, a payload that already has been contracted for fifteen years to Barrett Xplore for high capacity broadband services in rural Canada.  At this time we remain focused on achieving our full year objectives, including launching later this month Telstar 14R, a state-of-the-art satellite that will replace and expand upon our capacity serving the Americas and the fast growing North Atlantic maritime and aviation markets.”