Telesat released its financial results for the three-month and one-year periods that ended Dec. 31, 2019. For 2019, the Canadian satellite operator reported consolidated revenue of $911 million, which was unchanged compared to 2018 when adjusted for changes in foreign exchange rates. Net income in 2019 was $187 million, compared to a net loss of $91 million for 2018. Telesat attributed the increase in net income to non-cash foreign exchange gains in 2019. For the quarter that ended December 31, 2019, consolidated revenue was $220 million, a decrease of 5% compared to the same period in 2018.
The company said revenue increased in 2019 due to the Telstar 19 VANTAGE and Telstar 18 VANTAGE satellites, which were launched in 2018, in addition to short-term services Telesat offered to other satellite operators. These increases were offset by lower equipment sales, a reduction of service for a customer in the broadcast segment, lower revenue due to the completion of the term for prepaid services in a customer agreement, and lower revenue from certain customers in the resource sector.
The company reported that service in North America makes up 80% of revenue, followed by 8% in Latin America. In addition, fleet utilization is at 81%.
In a conference call with investors on Thursday, CEO Dan Goldberg said broadcast and enterprise services each comprised 49% of revenue, and consulting comprised 2%. Goldberg called 2019 a “productive” year for the company and reiterated Telesat’s focus on building its Low-Earth Orbit (LEO) constellation.
“In addition to a good year on the financial metrics, we also made significant progress on our LEO constellation, including refining the design of the constellation with our perspective suppliers, and working closely with the customer community using our in-orbit LEO satellite to conduct demonstrations and trials, to share the significant performance advantages of LEO,” he said.
Goldberg also projected the constellation will enter service by the end of 2022, with the full constellation in service by end of 2023. Goldberg also highlighted the partnership Telesat announced in July 2019 with the Canadian Government for partnership for the Telesat LEO constellation to provide high-speed internet for rural and remote areas. The company expects the partnership to generate $1.2 billion in revenue over 10 years.