Telesat (NASDAQ and TSX: TSAT), one of the world’s largest and most
innovative satellite operators, today announced that space
technology company MDA Ltd. (TSX: MDA) will build 198 advanced
satellites for the Telesat Lightspeed Low Earth Orbit (LEO)
program. Telesat also announced that Telesat Lightspeed is now
fully funded through global service delivery taking into account
the company’s own equity contribution, certain vendor financing,
and aggregate funding commitments from its Canadian federal and
provincial government partners.
By taking advantage of key technology advances, including MDA’s
industry-leading digital beamforming array antennas and integrated
regenerative processor, the re-designed Telesat Lightspeed network
will achieve increased network efficiency and enhanced flexibility
to focus and dynamically deliver capacity to users. These
technology advances allow each satellite to be slightly smaller
than the satellites Telesat was previously considering while still
maintaining the highest levels of service performance, resiliency
and overall usable capacity in the network.
Importantly, these state-of-the art satellites are also highly
cost effective, resulting in an anticipated total capital cost
savings for the 198-satellite program of approximately US$2 billion
compared to Telesat’s prior capital estimate. This substantial
savings facilitates the funding of the program and meaningfully
improves what were already compelling projected financial
returns.
Leveraging Telesat’s 54-year history of engineering excellence,
the Telesat Lightspeed network was designed from inception to serve
the demanding, mission-critical connectivity requirements of
enterprise and government users. Service offerings for the
optically-linked mesh network in space include multi-Gbps data
links, Layer 2 MEF 3.0 standards, and highly secure, resilient,
low-latency broadband connectivity anywhere in the world. With the
signing of this contract, the Telesat Lightspeed program begins
immediately, with satellite launches scheduled to commence in
mid-2026 and polar and global services scheduled to begin in late
2027.
“I’m incredibly proud of the Telesat team for their innovative
work to further optimize our Telesat Lightspeed design – which was
already a highly advanced and high performing LEO network –
resulting in dramatically reduced costs with unmatched
enterprise-class service offerings,” stated Dan Goldberg, President
and CEO of Telesat. “MDA is a world class satellite prime
contractor with an impressive track record and a number of recent
high profile, strategic space programs announced, and it is a
privilege to be working side-by-side with them on the flagship,
game-changing Telesat Lightspeed constellation. MDA’s deep
expertise as a LEO prime contractor, as well our own leading
expertise in satellite operations and systems engineering, gives us
the highest level of confidence in meeting our objectives.”
“True to our values, MDA has been committed to being a trusted
Telesat Lightspeed mission partner since the beginning, and our
proven performance as a LEO constellation satellite prime
contractor will now be leveraged to take the constellation
forward,” said Mike Greenley, CEO of MDA. “We believe in Telesat’s
mission and vision and are excited that our software-defined
digital satellite product will be a key enabler in meeting their
goals as we work together to usher in the next generation of
space-based satellite communications.”
Telesat Lightspeed Program Funding
Telesat now has in place aggregate funding commitments from its
Canadian federal and provincial government partners in the combined
amount of up to approximately US$2 billion, demonstrating their
strong commitment and confidence in the program and the importance
of the New Space Economy for Canada. The finalization of this
funding is dependent on a number of conditions, including
completion of confirmatory due diligence and the conclusion of
definitive agreements.
This funding, combined with Telesat’s own approximately US$1.6
billion equity contribution, as well as certain vendor financing,
would provide the Telesat Lightspeed program with sufficient funds
to launch global service, which will occur once the first 156
satellites are in orbit. Telesat will continue adding satellites
that are funded using Telesat Lightspeed cash flow to complete the
initial 198 satellite constellation. In addition to the
approximately US$2 billion in anticipated capital savings, Telesat
also expects substantial savings due to significantly reduced
financing costs relative to the company’s prior plan.
The capital investment for the Telesat Lightspeed program is
approximately US$3.5 billion and includes 198 Telesat Lightspeed
satellites, satellite launch vehicles, a global ground network of
landing stations and operations centers, business and operations
support systems, and expenditures to support the further
development of a portfolio of user terminals for Telesat’s target
markets.
Telesat Lightspeed is the largest space program ever conceived
in Canada and will be among the most innovative, cutting-edge
broadband satellite networks in the world. MDA will manufacture the
Telesat Lightspeed satellites in its state-of-the-art satellite
systems design and high-volume manufacturing facilities in Quebec.
The program will help bridge the digital divide, create and
maintain approximately 2,000 high-quality Canadian jobs, spur
Canadian-driven innovation and the development of valuable
intellectual property, generate billions of dollars in economic
growth, and drive domestic investment and exports.
“As a global leader in the new space economy, Canada is proud to
see two domestic champions join forces on this flagship Canadian
program to create high-skilled jobs and support cutting-edge
innovation in the telecom industry, helping unlock economic and
social opportunities in Canada’s rural and remote communities.
Canada remains a strong supporter of Telesat Lightspeed and will
continue to help solve some of the most pressing challenges we face
here on Earth, from bridging the digital divide, to health, climate
change, national security, and
more.” The
Honourable François-Philippe Champagne, Minister of Innovation,
Science and Industry
Goldberg added, “We are grateful and proud to have the strong
support of the Governments of Canada, Quebec and Ontario in the
Telesat Lightspeed program.”
The investments of Canadian federal and provincial governments
are denominated in Canadian dollars, which have been converted to
US dollars in this release at an exchange rate of 1.34CAD:1USD.
Earnings conference call:
Telesat has scheduled a conference call on Friday, August 11,
2023, at 9:30 a.m. ET to discuss its financial results for the
three month and six month periods ended June 30, 2023. Prior to the
commencement of the call, Telesat will post a news release
containing its financial results on its website. Details to access
the conference call and webcast can be found on Telesat’s Investor
Relations website.
About Telesat
Backed by a legacy of engineering excellence, reliability and
industry-leading customer service, Telesat (NASDAQ and TSX: TSAT)
is one of the largest and most innovative global satellite
operators. Telesat works collaboratively with its customers to
deliver critical connectivity solutions that tackle the world’s
most complex communications challenges, providing powerful
advantages that improve their operations and drive profitable
growth.
Continuously innovating to meet the connectivity demands of the
future, Telesat Lightspeed, the company’s Low Earth Orbit (LEO)
satellite network, will be the first and only LEO network optimized
to meet the rigorous requirements of telecom, government, maritime
and aeronautical customers. Telesat Lightspeed will redefine global
satellite connectivity with ubiquitous, affordable, high-capacity
links with fibre-like speeds. For updates on Telesat, follow us
@Telesat on Twitter, LinkedIn, or visit www.telesat.com.
Media
Relations Contacts |
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Lynette Simmons |
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+1 613 748 8729 |
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pr@telesat.com |
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Investor Relations Contacts: |
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Hugh Harley |
Michael Bolitho |
+1 613 748 8424 |
+1 613 748 8828 |
ir@telesat.com |
ir@telesat.com |
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Forward-Looking Statements Safe Harbor
This news release contains statements that are not based on
historical fact, including the growth opportunities and expected
performance, cost savings and financing of Telesat Lightspeed, and
are “forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995 and Canadian securities
laws. When used herein, statements which are not historical in
nature, or which contain the words “will,” “expect,” “intends,”
“anticipated,” “projected,” “finalized,” “scheduled to” or similar
expressions, are forward-looking statements. Actual results may
differ materially from the expectations expressed or implied in the
forward-looking statements as a result of known and unknown risks
and uncertainties. All statements made in this press release are
made only as of the date set forth at the beginning of this
release. Telesat Corporation undertakes no obligation to update the
information made in this release in the event facts or
circumstances subsequently change after the date of this press
release.
These forward-looking statements are based on Telesat
Corporation’s current expectations and are subject to a number of
risks, uncertainties and assumptions. These statements are not
guarantees of future performance and are subject to risks,
uncertainties and other factors, some of which are beyond Telesat
Corporation’s control, are difficult to predict, and could cause
actual results to differ materially from those expressed or
forecasted in the forward-looking statements. There are numerous
risks and uncertainties associated with our business and the
Telesat Lightspeed constellation. Known risks and uncertainties
include but are not limited to: inflation and rising interest
rates; our ability to enter into definitive funding agreements with
the company’s Canadian federal and provincial government partners,
and to meet the funding conditions of those agreements and of our
vendor financing; technological hurdles, including our and our
contractors’ development and deployment of the new technologies
required to complete the constellation in time to meet our
schedule, or at all; the availability of services and components
from our and our contractors’ supply chains; competition with other
LEO systems, deployed, and to be deployed, including systems
deployed by SpaceX, Amazon Kuiper and Eutelsat/OneWeb; risks
associated with domestic and foreign government regulation,
including access to sufficient orbital spectrum to be able to
deliver services effectively and access to sufficient geographic
markets in which to sell those services; our ability to develop
significant commercial and operational capabilities; risks
associated with operating satellites and providing satellite
services, including satellite construction or launch delays, launch
failures, in-orbit failures or impaired satellite performance; and
volatility in exchange rates. The foregoing list of important
factors is not exhaustive. Investors should review the other risk
factors discussed in Telesat Corporation’s annual report on Form
20-F for the year ended December 31, 2022, that was filed on March
29, 2023, with the United States Securities and Exchange Commission
(“SEC”) and the Canadian securities regulatory authorities at the
System for Electronic Document Analysis and Retrieval (“SEDAR”),
and may be accessed on the SEC’s website at https://www.sec.gov/
and SEDAR’s website at https://www.sedarplus.ca/ as well as our
subsequent reports on Form 6-K filed with the SEC and also
available on SEDAR.
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