Maxar Technologies (NYSE:MAXR) (TSX:MAXR) (“Maxar” or the
“Company”), a trusted partner and innovator in Earth Intelligence
and Space Infrastructure, today announced financial results for the
quarter and year ended December 31, 2020. All dollar amounts in
this press release are expressed in U.S. dollars, unless otherwise
noted.
Key points from the year include:
- Consolidated revenues from continuing operations of $1,723
million
- Net income of $303 million
- Diluted loss per share from continuing operations of $0.76
- Adjusted EBITDA1 from continuing operations of $422 million and
Adjusted EBITDA1 margin of 24.5%
- Completed the sale of the MDA Business on April 8, 2020
- Closed the acquisition of Vricon, Inc. to purchase the
remaining 50% ownership interest on July 1, 2020
- Repurchased $511 million of Term Loan B, closed the sale of
$150 million senior secured notes and settled the repurchase of
$150 million aggregate principal amount of existing 2023 notes
1 This is a non-GAAP financial measure. Refer to section
“Non-GAAP Financial Measures” in this earnings release.
“We made solid progress during 2020 toward achieving our
longer-term targets, including efforts to drive sustainable growth
in both our Earth Intelligence and Space Infrastructure segments
and to reduce our debt and leverage, as evidenced by solid 17%
year-over-year backlog growth and the closure of the MDA
divestiture and subsequent repayment of debt” stated Dan Jablonsky,
President and Chief Executive Officer.
Jablonsky continued, “In Earth Intelligence we had key wins and
deepened our relationships with the most discriminating and
innovative customers in the world, including the National
Reconnaissance Office, National Geospatial-Intelligence Agency,
U.S. Army, U.S. Air Force, U.S. Space Force, Department of Homeland
Security, and a multitude of commercial customers, including a
recent award that expanded our relationship with a long-time
technology customer by adding a multi-year contract including
Maxar’s 3D Elevation data. In Space Infrastructure, we booked six
new GEO Comsat awards and several civil programs, including
development work for NASA’s Human Landing System.”
“Full year revenue, Adjusted EBITDA and free cash flow results
were consistent with our guidance ranges despite absorbing higher
than expected stock-based compensation in the fourth quarter given
our share performance through the end of the year and the timing of
an award that slipped into early 2021,” stated Biggs Porter, Chief
Financial Officer. “For 2021, we expect to see revenue and Adjusted
EBITDA growth and an improvement in free cash flow,” he continued.
“Importantly, we have also increased our 2023 targets to better
reflect the earnings and cash generation power we see ahead.”
On April 8, 2020, we completed the previously announced sale of
the MDA Business to Neptune Acquisition Inc., a corporation
existing under the laws of the Province of British Columbia and an
affiliate of Northern Private Capital Ltd., for an aggregate
purchase price of $729 million (C$1.0 billion) subject to customary
purchase price adjustments, including for working capital, cash and
debt. We recognized an after-tax gain on disposal of discontinued
operations of $317 million, net of $12 million in taxes, on the MDA
Transaction for the year ended December 31, 2020. This divestiture
represented a strategic shift in our business and, in accordance
with U.S. GAAP, qualifies as a discontinued operation. As a result,
the operating results and cash flows related to the MDA Business
have been reflected as discontinued operations in the Consolidated
Statements of Operations and the Consolidated Statements of Cash
Flows.
On July 1, 2020, we closed the acquisition of Vricon Inc.
(“Vricon”) and purchased the remaining 50% ownership interest in
Vricon (“Vricon Acquisition”) for $143 million, or $120 million,
net of cash at closing. To fund the transaction, we issued $150
million in aggregate principal amount of new senior secured notes
due 2027.
Total revenues from continuing operations increased to $467
million from $410 million, or by $57 million, for the three months
ended December 31, 2020, compared to the same period in 2019. The
increase was primarily driven by an increase in the Space
Infrastructure segment which was partially offset by a decrease in
the Earth Intelligence segment. The decrease in Earth Intelligence
is primarily driven by a $30 million decrease in the recognition of
revenue related to the EnhancedView Contract. We recognized $30
million of deferred revenue from the EnhancedView Contract for the
three months ended December 31, 2019, compared to none for the
three months ended December 31, 2020.
Total revenues from continuing operations increased to $1,723
million from $1,666 million, or by $57 million, for the year ended
December 31, 2020 compared to the same period in 2019. The increase
was primarily driven by an increase in the Space Infrastructure
segment partially offset by a decrease in the Earth Intelligence
segment. The decrease was primarily driven by a $40 million
decrease in the recognition of deferred revenue related to the
EnhancedView Contract. We recognized $120 million of deferred
revenue from the EnhancedView Contract for the year ended December
31, 2019, compared to $80 million for the year ended December 31,
2020, as it was fully recognized as of August 31, 2020.
For the three months ended December 31, 2020, net loss (income)
from continuing operations decreased to a net loss of $52 million
from net income of $53 million, or by $105 million, compared to the
same period in 2019. The decrease was primarily driven by a gain on
sale of assets of $136 million in 2019 that did not reoccur in 2020
partially offset by increases in revenues in the Space
Infrastructure segment.
For the year ended December 31, 2020, net loss (income) from
continuing operations decreased to a net loss of $46 million from
net income of $83 million, or by $129 million, compared to the same
period in 2019. The decrease was primarily driven by the receipt of
satellite insurance proceeds of $183 million and a gain on sale of
assets of $136 million in 2019 that did not reoccur in 2020. The
decrease was partially offset by an $85 million gain on
remeasurement of the previously held equity interest in Vricon and
increases in revenues in the Space Infrastructure segment.
For the three months ended December 31, 2020, Adjusted EBITDA
was $95 million and Adjusted EBITDA as a percentage of consolidated
revenues (“Adjusted EBITDA margin percentage”) was 20.3%. This is
compared to Adjusted EBITDA of $100 million and Adjusted EBITDA
margin percentage of 24.4% for the fourth quarter of 2019. The
decrease was driven by lower Adjusted EBITDA from the Earth
Intelligence segment primarily as a result of a $30 million
decrease in deferred revenue recognized related to the EnhancedView
Contract discussed above, partially offset by higher Adjusted
EBITDA from the Space Infrastructure segment.
For the year ended December 31, 2020, Adjusted EBITDA was $422
million and Adjusted EBITDA as a percentage of consolidated
revenues was 24.5%. This is compared to Adjusted EBITDA of $416
million and Adjusted EBITDA margin percentage of 25.0% for the year
ended 2019. The increase was driven by higher Adjusted EBITDA from
the Space Infrastructure segment and lower corporate and other
expenses partially offset by lower Adjusted EBITDA from the Earth
Intelligence segment primarily as a result of a $40 million
decrease in deferred revenue recognized related to the EnhancedView
Contract discussed above.
Our results of operations for the year ended December 31, 2020
include the current estimated impact of COVID-19. We had COVID-19
related EAC growth of $27 million within the Space Infrastructure
segment, which negatively impacted earnings for the year ended
December 31, 2020. The changes in the EACs are due to increases in
estimated program costs associated with the COVID-19 operating
posture and the estimated impact of certain items such as supplier
delays and increased labor hours along with actuals realized during
the year ended December 31, 2020.
We had total order backlog of $1.9 billion as of December 31,
2020 compared to $1.6 billion as of December 31, 2019. The increase
in backlog was primarily driven by an increase in the Space
Infrastructure segment due to new contracts with the U.S.
government. There was also a decrease in the Earth Intelligence
segment driven by revenue recognized during the period, partially
offset by the annual exercise of the $300 million EnhancedView
Contract option. Our unfunded contract options totaled $0.9 billion
and $1.4 billion as of December 31, 2020 and December 31, 2019,
respectively.
Financial Highlights
In addition to results reported in accordance with U.S. GAAP, we
use certain non-GAAP financial measures as supplemental indicators
of its financial and operating performance. These non-GAAP
financial measures include EBITDA and Adjusted EBITDA. We believe
these supplementary financial measures reflect the Company’s
ongoing business in a manner that allows for meaningful
period-to-period comparisons and analysis of trends in its
business.
Three Months Ended
Year Ended
December 31,
December 31,
2020
2019
2020
2019
($ millions, except per share amounts)
Revenues
$
467
$
410
$
1,723
$
1,666
(Loss) income from continuing
operations
(52
)
53
(46
)
83
Income (loss) from discontinued
operations, net of tax
12
(10
)
349
26
Net (loss) income
$
(40
)
$
43
303
109
EBITDA1
76
206
801
707
Adjusted EBITDA1
95
100
422
416
Diluted (loss) income per common
share:
(Loss) income from continuing
operations
$
(0.85
)
$
0.87
$
(0.76
)
$
1.38
Income (loss) from discontinued
operations, net of tax
0.20
(0.17
)
5.75
0.43
Diluted (loss) income per common share
$
(0.65
)
$
0.70
$
4.99
$
1.81
Weighted average number of common shares
outstanding (millions):
Basic
61.1
59.8
60.7
59.6
Diluted
61.1
61.2
60.7
60.2
1 This is a non-GAAP financial measure.
Refer to section “Non-GAAP Financial Measures” in this earnings
release.
Revenues by segment were as follows:
Three Months Ended
Year Ended
December 31,
December 31,
2020
2019
2020
2019
($ millions)
Revenues:
Earth Intelligence
$
258
$
286
$
1,081
$
1,085
Space Infrastructure
224
153
721
706
Intersegment eliminations
(15
)
(29
)
(79
)
(125
)
Total revenues
$
467
$
410
$
1,723
$
1,666
We analyze financial performance by segment, which combine
related activities within the Company.
Three Months Ended
Year Ended
December 31,
December 31,
($ millions)
2020
2019
2020
2019
Adjusted EBITDA:
Earth Intelligence
$
106
$
154
$
513
$
548
Space Infrastructure
13
(19
)
(3
)
(17
)
Intersegment eliminations
(6
)
(9
)
(27
)
(29
)
Corporate and other expenses
(18
)
(26
)
(61
)
(86
)
Adjusted EBITDA1
$
95
$
100
$
422
$
416
1 This is a non-GAAP financial measure.
Refer to section “Non-GAAP Financial Measures” in this earnings
release.
Earth Intelligence
Three Months Ended
Year Ended
December 31,
December 31,
2020
2019
2020
2019
($ millions)
Revenues
$
258
$
286
$
1,081
$
1,085
Adjusted EBITDA
$
106
$
154
$
513
$
548
Adjusted EBITDA Margin
41.1
%
53.8
%
47.5
%
50.5
%
Revenues from the Earth Intelligence segment decreased to $258
million from $286 million, or by $28 million, for the three months
ended December 31, 2020, compared to the same period in 2019. The
decrease was primarily driven by a $30 million decrease in the
recognition of revenue related to the EnhancedView Contract. We
recognized $30 million of deferred revenue from the EnhancedView
Contract for the three months ended December 31, 2019, compared to
none for the three months ended December 31, 2020. The amortization
of the deferred revenue was complete effective August 2020 and
there will be no further deferred revenue recognized on the
EnhancedView Contract. The decrease was also driven by a $6 million
decrease in revenue with the U.S. government. These decreases were
partially offset by an increase of $8 million driven by the
inclusion of Vricon for one quarter in 2020 compared to none in
2019.
Revenues decreased to $1,081 million from $1,085 million, or by
$4 million, for the year ended December 31, 2020, compared to the
same period in 2019. The decrease was primarily driven by a $40
million decrease in the recognition of deferred revenue related to
the EnhancedView Contract. We recognized $120 million of deferred
revenue from the EnhancedView Contract for the year ended December
31, 2019, compared to $80 million for the year ended December 31,
2020, as it was fully recognized as of August 31, 2020. These
decreases were partially offset by a $15 million increase in
revenue from new contracts with the U.S. government, an $11 million
increase in revenue from international defense and intelligence
customers, and a $10 million increase in revenue driven by the
inclusion of Vricon’s revenue for two quarters in 2020 compared to
none in 2019 as it was accounted for as an equity method
investment. Revenue from international defense and intelligence
customers increased primarily due to the usage of new direct access
facilities which became operational and contracts that signed in
the second half of 2019.
Adjusted EBITDA from the Earth Intelligence segment decreased to
$106 million from $154 million, or by $48 million, for the three
months ended December 31, 2020, compared to the same period of
2019. The decrease was primarily driven by a decrease in revenues
of $30 million from the EnhancedView contract, a $15 million
decrease related to equity in income from our Vricon joint venture
which was acquired and consolidated into our results in 2020 and a
decrease of $6 million from revenue with the U.S. government.
Adjusted EBITDA decreased to $513 million from $548 million, or
by $35 million, for the year ended December 31, 2020, compared to
the same period in 2019. The decrease was primarily driven by a $40
million decrease in the recognition of revenue related to the
EnhancedView Contract and a $10 million decrease related to equity
in income from our Vricon joint venture which was acquired and
consolidated in our results in 2020. These decreases were partially
offset by an increase in revenue from new contracts with the U.S.
government.
Space Infrastructure
Three Months Ended
Year Ended
December 31,
December 31,
2020
2019
2020
2019
($ millions)
Revenues
$
224
$
153
$
721
$
706
Adjusted EBITDA
$
13
$
(19
)
$
(3
)
$
(17
)
Adjusted EBITDA Margin
5.8
%
(12.4
)%
(0.4
)%
(2.4
)%
Changes in revenues from year to year are influenced by the
size, timing and number of satellite contracts awarded in the
current and preceding years and the length of the construction
period for satellite contracts awarded. Revenues on satellite
contracts are recognized using the cost-to-cost method of
accounting to determine the percentage of completion over the
construction period, which typically ranges between 20 to 36 months
and up to 48 months in certain situations. Adjusted EBITDA margins
can vary from quarter to quarter due to the mix of our revenues and
changes in our estimated costs to complete as our risks are retired
and as our estimated costs to complete are increased or decreased
based on contract performance.
Revenues from the Space Infrastructure segment increased to $224
million from $153 million, or by $71 million, for the three months
ended December 31, 2020, compared to the same period in 2019.
Revenues increased primarily as a result of the impact of increased
volumes on commercial programs of $47 million during the three
months ended December 31, 2020, compared to the same period in
2019. The increase was also driven by an increase in volume related
to U.S. government contracts of $24 million, compared to the same
period in 2019.
Revenues increased to $721 million from $706 million, or by $15
million, for the year ended December 31, 2020, compared to the same
period in 2019. Revenues increased primarily as a result of an
increase in volume related to U.S. government contracts of $137
million during the year ended December 31, 2020, compared to the
same period in 2019. This increase in revenue was partially offset
by the impact of reduced volumes on commercial programs of $122
million including a $9 million impact due to increases in estimated
costs and an associated change in the EAC profit margin of a
commercial satellite program due to the identification of a design
anomaly in the final stage of a testing process. Revenues were also
negatively impacted by $27 million of estimated COVID-19 related
EAC growth during the period and are included in the
above-mentioned results. The increases in the EACs are due to
increases in estimated program costs associated with the COVID-19
operating posture and the estimated impact of certain items such as
supplier delays and increased labor hours. These costs are
considered incremental and separable from normal operations.
Adjusted EBITDA for the Space Infrastructure segment increased
to $13 million of income from a loss of $19 million, or by $32
million, for the three months ended December 31, 2020, compared to
the same period in 2019. The increase in the Space Infrastructure
segment is primarily related to higher margins on commercial
programs of $36 million driven by a change in program mix related
to the completion of less profitable programs offset by new, more
profitable programs. The increase was partially offset by an
increase in labor of $4 million and a $2 million increase in stock
compensation.
Adjusted EBITDA changed to a loss of $3 million from a loss of
$17 million, or by $14 million, for the year ended December 31,
2020, compared to the same period in 2019. The increase in the
Space Infrastructure segment is primarily related to higher margins
and favorable EACs outside of the estimated COVID-19 impacts
discussed below, on commercial programs of $68 million. This has
been driven by a change in program mix related to the completion of
less profitable programs offset by new, more profitable programs
along with $8 million less of program losses on a developmental
program for the year ended December 31, 2020, compared to the same
period in 2019. The increase in commercial programs are partially
offset by an estimated $27 million negative impact related to our
COVID-19 operating posture. The increase is also partially offset
by a $16 million increase in costs due to a change in the
compensation structure from retention payments to bonuses which
were not included in segment Adjusted EBITDA in 2019, a $9 million
negative impact on the above-mentioned commercial satellite program
with a design anomaly and a recovery of a previously reserved
amount of $7 million in 2019 which did not reoccur in 2020. The
remainder of the change was related to a decrease in cost of
product and services and selling, general, and administrative
expenses.
Corporate and other expenses
Corporate and other expenses include items such as corporate
office costs, regulatory costs, executive and director
compensation, foreign exchange gains and losses, retention costs,
and fees for legal and consulting services.
Corporate and other expenses decreased to $18 million from $26
million, or by $8 million, for the three months ended December 31,
2020, compared to the same period in 2019. The decrease was
primarily driven by a $6 million decrease in retention costs
related to a 2019 program within the Space Infrastructure segment
and a decrease in selling, general and administrative costs of $2
million for the three months ended December 31, 2020, compared to
the same period in 2019.
Corporate and other expenses decreased to $61 million from $86
million, or by $25 million, for the year ended December 31, 2020,
compared to the same period in 2019. The decrease was primarily
driven by a $24 million decrease in retention costs related to a
2019 program within the Space Infrastructure segment. The decrease
was also driven by a $5 million foreign exchange gain for the year
ended December 31, 2020, compared to a $2 million foreign exchange
loss for the year ended December 31, 2019. These decreases were
partially offset by a $13 million increase in stock-based
compensation expense primarily driven by a higher stock price.
Intersegment eliminations
Intersegment eliminations are related to projects between our
segments, including WorldView Legion. Intersegment eliminations
have decreased to $6 million from $9 million, or by $3 million, for
the three months ended December 31, 2020 compared to the same
period in 2019, primarily related to a decrease in intersegment
satellite construction activity.
Intersegment eliminations have decreased to $27 million from $29
million, or by $2 million, for the year ended December 31, 2020
compared to the same period in 2019, primarily related to a
decrease in intersegment satellite construction activity
MAXAR TECHNOLOGIES INC.
Consolidated Statements of Operations
(In millions, except per share
amounts)
Year Ended
December 31,
2020
2019
2018
Revenues:
Product
$
633
$
560
$
697
Service
1,090
1,106
1,107
Total revenues
1,723
1,666
1,804
Costs and expenses:
Product costs, excluding depreciation and
amortization
615
593
775
Service costs, excluding depreciation and
amortization
378
382
313
Selling, general and administrative
332
325
446
Depreciation and amortization
348
376
439
Impairment losses
47
14
586
Satellite insurance recovery
—
(183
)
—
Loss (gain) on sale of assets
1
(136
)
(33
)
Operating income (loss)
2
295
(722
)
Interest expense, net
175
219
200
Other (income) expense, net
(104
)
(1
)
1
(Loss) income before taxes
(69
)
77
(923
)
Income tax (benefit) expense
(22
)
5
(48
)
Equity in income from joint ventures, net
of tax
(1
)
(11
)
(2
)
(Loss) income from continuing
operations
(46
)
83
(873
)
Discontinued operations:
Income (loss) from operations of
discontinued operations, net of tax
32
26
(377
)
Gain on disposal of discontinued
operations, net of tax
317
—
—
Income (loss) from discontinued
operations, net of tax
349
26
(377
)
Net income (loss)
$
303
$
109
$
(1,250
)
Basic net income (loss) per common
share:
(Loss) income from continuing
operations
$
(0.76
)
$
1.39
$
(15.03
)
Income (loss) from discontinued
operations, net of tax
5.75
0.44
(6.49
)
Basic net income (loss) per common
share
$
4.99
$
1.83
$
(21.52
)
Diluted net income (loss) per common
share:
(Loss) income from continuing
operations
$
(0.76
)
$
1.38
$
(15.03
)
Income (loss) from discontinued
operations, net of tax
5.75
0.43
(6.49
)
Diluted net income (loss) per common
share
$
4.99
$
1.81
$
(21.52
)
MAXAR TECHNOLOGIES INC.
Consolidated Balance Sheets
(In millions, except per share
amounts)
December 31,
December 31,
2020
2019
Assets
Current assets:
Cash and cash equivalents
$
27
$
59
Trade and other receivables, net
327
357
Inventory
31
20
Advances to suppliers
24
42
Prepaid and other current assets
59
32
Current assets held for sale
—
751
Total current assets
468
1,261
Non-current assets:
Orbital receivables, net
361
382
Property, plant and equipment, net
883
758
Intangible assets, net
895
991
Non-current operating lease assets
163
176
Goodwill
1,627
1,455
Other non-current assets
86
134
Total assets
$
4,483
$
5,157
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable
$
115
$
153
Accrued liabilities
65
130
Accrued compensation and benefits
105
93
Contract liabilities
278
271
Current portion of long-term debt
8
30
Current operating lease liabilities
41
40
Other current liabilities
51
49
Current liabilities held for sale
—
230
Total current liabilities
663
996
Non-current liabilities:
Pension and other postretirement
benefits
192
191
Contract liabilities
1
4
Operating lease liabilities
158
173
Long-term debt
2,414
2,915
Other non-current liabilities
119
116
Total liabilities
3,547
4,395
Commitments and contingencies
Stockholders’ equity:
Common stock ($0.0001 par value, 240
million common shares authorized; 61.2 million and 59.9 million
outstanding at December 31, 2020 and 2019, respectively)
—
—
Additional paid-in capital
1,818
1,784
Accumulated deficit
(763
)
(1,064
)
Accumulated other comprehensive (loss)
income
(120
)
41
Total Maxar stockholders' equity
935
761
Noncontrolling interest
1
1
Total stockholders' equity
936
762
Total liabilities and stockholders'
equity
$
4,483
$
5,157
MAXAR TECHNOLOGIES INC.
Consolidated Statements of Cash Flows
(In millions)
Year Ended
December 31,
2020
2019
2018
Cash flows (used in) provided by:
Operating activities:
Net income (loss)
$
303
$
109
$
(1,250
)
(Income) loss from operations of
discontinued operations, net of tax
(32
)
(26
)
377
Gain on disposal of discontinued
operations, net of tax
(317
)
—
—
(Loss) income from continuing
operations
(46
)
83
(873
)
Adjustments to reconcile net income (loss)
to net cash (used in) provided by operating activities:
Impairment losses including inventory
47
17
651
Depreciation and amortization
348
376
439
Gain from remeasurement of equity interest
in acquiree
(85
)
—
—
Amortization of debt issuance costs and
other non-cash interest expense
16
11
9
Stock-based compensation expense
43
20
20
Loss from early extinguishment of debt
7
22
—
Loss (gain) on sale of assets
1
(136
)
(33
)
Deferred income tax benefit
(17
)
—
(48
)
Equity in income from joint ventures, net
of tax
(1
)
(11
)
(2
)
Other
2
7
28
Changes in operating assets and
liabilities:
Trade and other receivables
33
(20
)
(19
)
Accounts payables and liabilities
(84
)
17
86
Contract liabilities
5
(117
)
(158
)
Other
(26
)
(11
)
14
Cash provided by operating activities -
continuing operations
243
258
114
Cash (used in) provided operating
activities - discontinued operations
(54
)
59
25
Cash provided by operating activities
189
317
139
Investing activities:
Purchase of property, plant and equipment
and development or purchase of software
(308
)
(314
)
(206
)
Acquisition, net of cash acquired
(120
)
—
—
Sale of assets
—
280
68
Return of capital from discontinued
operations
20
28
—
Other
2
—
9
Cash used in investing activities -
continuing operations
(406
)
(6
)
(129
)
Cash provided by (used in) investing
activities - discontinued operations
723
(7
)
(21
)
Cash provided by (used in) investing
activities
317
(13
)
(150
)
Financing activities:
Net payment of revolving credit
facility
—
(595
)
—
Net proceeds from issuance of 2023 Notes,
2027 Notes, and other long-term debt
147
980
104
Repurchase of 2023 Notes, including
premium
(169
)
—
—
Repayments of long-term debt
(525
)
(523
)
(24
)
Refinancing fees paid to creditors
—
(20
)
—
Repurchase of orbital receivables
—
(24
)
—
Settlement of securitization liability
(11
)
(20
)
(15
)
Proceeds from securitization of orbital
receivables
—
—
18
Other
3
(6
)
(68
)
Cash (used in) provided by financing
activities - continuing operations
(555
)
(208
)
15
Cash used in financing activities -
discontinued operations
(24
)
(30
)
(2
)
Cash (used in) provided by financing
activities
(579
)
(238
)
13
(Decrease) increase in cash, cash
equivalents, and restricted cash
(73
)
66
2
Effect of foreign exchange on cash, cash
equivalents, and restricted cash
(5
)
—
(1
)
Cash, cash equivalents, and restricted
cash, beginning of year
109
43
42
Cash, cash equivalents, and restricted
cash, end of year
$
31
$
109
$
43
Reconciliation of cash flow
information:
Cash and cash equivalents
$
27
$
105
$
35
Restricted cash included in prepaid and
other current assets
4
1
7
Restricted cash included in other
non-current assets
—
3
1
Total cash, cash equivalents, and
restricted cash
$
31
$
109
$
43
NON-GAAP FINANCIAL MEASURES
In addition to results reported in accordance with U.S. GAAP, we
use certain non-GAAP financial measures as supplemental indicators
of our financial and operating performance. These non-GAAP
financial measures include EBITDA and Adjusted EBITDA.
We define EBITDA as earnings before interest, taxes,
depreciation and amortization, and Adjusted EBITDA as EBITDA
adjusted for certain items affecting comparability as specified in
the calculation. Certain items affecting comparability include
restructuring, impairments, satellite insurance recovery, gain
(loss) on sale of assets, CEO severance and transaction and
integration related expense. Transaction and integration related
expense includes costs associated with de-leveraging activities,
acquisitions and dispositions and the integration of acquisitions.
Management believes that exclusion of these items assists in
providing a more complete understanding of our underlying results
and trends, and management uses these measures along with the
corresponding U.S. GAAP financial measures to manage our business,
evaluate our performance compared to prior periods and the
marketplace, and to establish operational goals. Adjusted EBITDA is
a measure being used as a key element of our incentive compensation
plan. The Syndicated Credit Facility also uses Adjusted EBITDA in
the determination of our debt leverage covenant ratio. The
definition of Adjusted EBITDA in the Syndicated Credit Facility
includes a more comprehensive set of adjustments that may result in
a different calculation therein.
We believe that these non-GAAP measures, when read in
conjunction with our U.S. GAAP results, provide useful information
to investors by facilitating the comparability of our ongoing
operating results over the periods presented, the ability to
identify trends in our underlying business, and the comparison of
our operating results against analyst financial models and
operating results of other public companies.
EBITDA and Adjusted EBITDA are not recognized terms under U.S.
GAAP and may not be defined similarly by other companies. EBITDA
and Adjusted EBITDA should not be considered alternatives to net
(loss) income as indications of financial performance or as
alternate to cash flows from operations as measures of liquidity.
EBITDA and Adjusted EBITDA have limitations as an analytical tool
and should not be considered in isolation or as a substitute for
our results reported under U.S. GAAP. The table below reconciles
our net (loss) income to EBITDA and Adjusted EBITDA for the years
ended December 31, 2020, 2019 and 2018.
Three Months Ended
Year Ended
December 31,
December 31,
2020
2019
2020
2019
2018
($ millions)
Net (loss) income
$
(40
)
$
43
$
303
$
109
$
(1,250
)
Income tax expense (benefit)
—
2
(22
)
5
(48
)
Interest expense, net
42
71
175
219
200
Interest income
—
(2
)
(3
)
(2
)
—
Depreciation and amortization
74
92
348
376
439
EBITDA1
$
76
$
206
$
801
$
707
$
(659
)
(Income) loss from discontinued
operations, net of tax
(12
)
10
(349
)
(26
)
377
Restructuring
—
4
—
18
13
Transaction and integration related
expense
1
2
7
16
33
Impairment losses, including inventory
33
14
47
17
652
Satellite insurance recovery
—
—
—
(183
)
—
(Gain) loss on sale of assets
(3
)
(136
)
1
(136
)
(33
)
CEO severance
—
—
—
3
—
Gain on remeasurement of Vricon equity
interest
—
—
(85
)
—
—
Adjusted EBITDA1
$
95
$
100
$
422
$
416
$
383
Adjusted EBITDA:
Earth Intelligence
$
106
$
154
$
513
$
548
$
516
Space Infrastructure
13
(19
)
(3
)
(17
)
(75
)
Intersegment eliminations
(6
)
(9
)
(27
)
(29
)
(9
)
Corporate and other expenses
(18
)
(26
)
(61
)
(86
)
(49
)
Adjusted EBITDA1
$
95
$
100
$
422
$
416
$
383
Cautionary Note Regarding Forward-Looking Statements
Certain statements and other information included in this
release constitute "forward-looking information" or
"forward-looking statements" (collectively, "forward-looking
statements") under applicable securities laws. Statements including
words such as "may", "will", "could", "should", "would", "plan",
"potential", "intend", "anticipate", "believe", "estimate" or
"expect" and other words, terms and phrases of similar meaning are
often intended to identify forward-looking statements, although not
all forward-looking statements contain these identifying words.
Forward-looking statements involve estimates, expectations,
projections, goals, forecasts, assumptions, risks and
uncertainties, as well as other statements referring to or
including forward-looking information included in this
presentation.
Forward-looking statements are subject to various risks and
uncertainties which could cause actual results to differ materially
from the anticipated results or expectations expressed in this
presentation. As a result, although management of the Company
believes that the expectations and assumptions on which such
forward-looking statements are based are reasonable, undue reliance
should not be placed on the forward-looking statements because the
Company can give no assurance that they will prove to be correct.
The risks that could cause actual results to differ materially from
current expectations include, but are not limited to, the risk
factors and other disclosures about the Company and its business
included in the Company's continuous disclosure materials filed
from time to time with U.S. securities and Canadian regulatory
authorities, which are available online under the Company's EDGAR
profile at www.sec.gov, under the Company's SEDAR profile at
www.sedar.com or on the Company's website at www.maxar.com.
The forward-looking statements contained in this release are
expressly qualified in their entirety by the foregoing cautionary
statements. All such forward-looking statements are based upon data
available as of the date of this presentation or other specified
date and speak only as of such date. The Company disclaims any
intention or obligation to update or revise any forward-looking
statements in this presentation as a result of new information or
future events, except as may be required under applicable
securities legislation.
*****
Unless stated otherwise or the context otherwise requires,
references to the terms “Company,” “Maxar,” “we,” “us,” and “our”
to refer collectively to Maxar Technologies Inc. and its
consolidated subsidiaries.
Investor/Analyst Conference Call
Maxar President and Chief Executive Officer, Dan Jablonsky, and
Executive Vice President and Chief Financial Officer, Biggs Porter,
will host an earnings conference call Wednesday, February 24, 2021,
reviewing the fourth quarter and year end results, followed by a
question and answer session. The call is scheduled to begin
promptly at 3:00 p.m. MT (5:00 p.m. ET).
Investors and participants must register for the call in advance
by visiting:
http://www.directeventreg.com/registration/event/6302437.
After registering, participants will receive dial-in
information, a passcode, and registrant ID. At the time of the
call, participants must dial in using the numbers in the
confirmation email and enter their passcode and ID.
The Conference Call will be Webcast live and then archived at:
http://investor.maxar.com/events-and-presentations/default.aspx
Telephone replay of the conference call will also be available
from Wednesday, February 24, 2021 at 6:00 p.m. MT (8:00 p.m. ET) to
Wednesday, March 10 at 9:59 p.m. MT (11:59 p.m. ET) at the
following numbers:
Toll free North America: 1-800-585-8367 International Dial-In:
1-416-621-4642 Passcode: 6302437#
About Maxar
Maxar is a trusted partner and innovator in Earth Intelligence
and Space Infrastructure. We deliver disruptive value to government
and commercial customers to help them monitor, understand and
navigate our changing planet; deliver global broadband
communications; and explore and advance the use of space. Our
unique approach combines decades of deep mission understanding and
a proven commercial and defense foundation to deploy solutions and
deliver insights with speed, scale, and cost effectiveness. Maxar’s
4,300 team members in more than 20 global locations are inspired to
harness the potential of space to help our customers create a
better world. Maxar’s stock trades on the New York Stock Exchange
and Toronto Stock Exchange under the symbol “MAXR”. For more
information, visit www.maxar.com.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210224005943/en/
Jason Gursky | VP Investor Relations | 1-303-684-2207 |
jason.gursky@maxar.com Turner Brinton | Media
Relations | 1-303-684-4545 | turner.brinton@maxar.com
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