Revenues from the Space Infrastructure segment increased to $155 million from $132 million, or by $23 million, for the three months ended March 31, 2021, compared to the same period in 2020. Revenues increased primarily as a result of an increase in revenues from commercial programs of $37 million due to higher volumes related to new programs and lower EAC growth primarily due to no COVID-19 program impacts for the three months ended March 31, 2021. Revenues were negatively impacted by a $14 million decrease year over year related to our contract with Sirius XM Holdings Inc. (“Sirius XM”). The three months ended March 31, 2021, included a $25 million cumulative adjustment to revenue primarily related to the loss of final milestone and expected orbital payments due to the non-performance of the SXM-7 satellite and other adjustments. After exhausting efforts to fully recover the satellite and further discussions with Sirius XM, in April 2021, we made the determination to record the cumulative adjustment to revenue. In addition, there were $3 million of costs incurred in the first quarter related to attempts to repair and fully recover the SXM-7 satellite. The aggregate impact for the three months ended March 31, 2021, was $28 million which compares favorably to the previously disclosed potential exposure of $38 million. The $28 million decrease was partially offset by the non-reoccurrence of a $14 million adjustment to revenue due to the identification of a design anomaly on the commercial satellite program, which was recorded for the three months ended March 31, 2020.
Adjusted EBITDA from the Space Infrastructure segment changed to a loss $12 million from a loss of $39 million, or by $27 million, for the three months ended March 31, 2021, compared to the same period of 2020. The increase in the Space Infrastructure segment was primarily related to a $44 million increase in commercial program margins due to new programs and fewer negative EAC impacts during the period as compared to the three months ended March 31, 2020, which included negative EAC impacts due to COVID-19. The increase in commercial program margins has been driven by a change in program mix related to the completion of less profitable programs offset by new, more profitable programs. These increases were partially offset by the $14 million reduction in revenue related to the above-mentioned SXM-7 satellite impacts.
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 for the three months ended March 31, 2021 increased to $23 million from $10 million, or by $13 million, compared to the same period in 2020. The increase was driven by a $4 million increase in stock-based compensation expense primarily driven by a higher stock price and a $3 million increase in labor related expenses primarily driven by an increase in headcount and employee compensation related to the shift of our information technology function to corporate effective January 1, 2021, as we have centralized this function. The increase was also driven by a $2 million foreign exchange loss for the three months ended March 31, 2021, compared to a $2 million foreign exchange gain for the three months ended March 31, 2020.
Intersegment eliminations
Intersegment eliminations are related to projects between our segments, including our WorldView Legion satellite constellation. Intersegment eliminations have decreased to $5 million from $7 million, or by $2 million, for the three months ended March 31, 2021 compared to the same period in 2020, primarily related to a decrease in intersegment satellite construction activity.
MAXAR TECHNOLOGIES INC. Consolidated Statements of Operations (In millions, except per share amounts) |
||||||||
|
|
|
|
|
|
|
||
|
|
Three Months Ended |
||||||
|
|
March 31, |
||||||
|
|
2021 |
|
2020 |
||||
Revenues: |
|
|
|
|
|
|
||
Product |
|
$ |
142 |
|
|
$ |
107 |
|
Service |
|
|
250 |
|
|
|
274 |
|
Total revenues |
|
|
392 |
|
|
|
381 |
|
| Costs and expenses: |
|
|
|
|
|
|
||
| Product costs, excluding depreciation and amortization |
|
|
148 |
|
|
|
145 |
|
| Service costs, excluding depreciation and amortization |
|
|
93 |
|
|
|
93 |
|
| Selling, general and administrative |
|
|
84 |
|
|
|
68 |
|
| Depreciation and amortization |
|
|
74 |
|
|
|
90 |
|
| Impairment loss |
|
|
— |
|
|
|
14 |
|
| Operating loss |
|
|
(7 |
) |
|
|
(29 |
) |
| Interest expense, net |
|
|
78 |
|
|
|
49 |
|
| Other income, net |
|
|
(1 |
) |
|
|
(3 |
) |
| Loss before taxes |
|
|
(84 |
) |
|
|
(75 |
) |
| Income tax expense |
|
|
— |
|
|
|
2 |
|
| Equity in loss from joint ventures, net of tax |
|
|
— |
|
|
|
1 |
|
| Loss from continuing operations |
|
|
(84 |
) |
|
|
(78 |
) |
| Income from discontinued operations, net of tax |
|
|
— |
|
|
|
30 |
|
| Net loss |
|
$ |
(84 |
) |
|
$ |
(48 |
) |
|
|
|
|
|
|
|
|
||
| Basic net income (loss) per common share: |
|
|
|
|
|
|
||
| Loss from continuing operations |
|
$ |
(1.30 |
) |
|
$ |
(1.30 |
) |
| Income from discontinued operations, net of tax |
|
|
— |
|
|
|
0.50 |
|
| Basic net loss per common share |
|
$ |
(1.30 |
) |
|
$ |
(0.80 |
) |
|
|
|
|
|
|
|
|
||
| Diluted net income (loss) per common share: |
|
|
|
|
|
|
||
| Loss from continuing operations |
|
$ |
(1.30 |
) |
|
$ |
(1.30 |
) |
| Income from discontinued operations, net of tax |
|
|
— |
|
|
|
0.50 |
|
| Diluted net loss per common share |
|
$ |
(1.30 |
) |
|
$ |
(0.80 |
|
| MAXAR TECHNOLOGIES INC. Consolidated Balance Sheets (In millions, except per share amounts) |
||||||||
|
|
|
|
|
|
|
|
||
|
|
|
March 31, |
|
December 31, |
||||
|
|
|
2021 |
|
2020 |
||||
| Assets |
|
|
|
|
|
|
||
| Current assets: |
|
|
|
|
|
|
||
| Cash and cash equivalents |
|
$ |
22 |
|
|
$ |
27 |
|
| Trade and other receivables, net |
|
|
318 |
|
|
|
327 |
|
| Inventory |
|
|
38 |
|
|
|
31 |
|
| Advances to suppliers |
|
|
27 |
|
|
|
24 |
|
| Prepaid and other current assets |
|
|
58 |
|
|
|
59 |
|
| Total current assets |
|
|
463 |
|
|
|
468 |
|
| Non-current assets: |
|
|
|
|
|
|
||
| Orbital receivables, net |
|
|
339 |
|
|
|
361 |
|
| Property, plant and equipment, net |
|
|
889 |
|
|
|
883 |
|
| Intangible assets, net |
|
|
867 |
|
|
|
895 |
|
| Non-current operating lease assets |
|
|
156 |
|
|
|
163 |
|
| Goodwill |
|
|
1,627 |
|
|
|
1,627 |
|
| Other non-current assets |
|
|
84 |
|
|
|
86 |
|
| Total assets |
|
$ |
4,425 |
|
|
$ |
4,483 |
|
| Liabilities and stockholders’ equity |
|
|
|
|
|
|
||
| Current liabilities: |
|
|
|
|
|
|
||
| Accounts payable |
|
$ |
104 |
|
|
$ |
115 |
|
| Accrued liabilities |
|
|
77 |
|
|
|
65 |
|
| Accrued compensation and benefits |
|
|
76 |
|
|
|
105 |
|
| Contract liabilities |
|
|
284 |
|
|
|
278 |
|
| Current portion of long-term debt |
|
|
8 |
|
|
|
8 |
|
| Current operating lease liabilities |
|
|
41 |
|
|
|
41 |
|
| Other current liabilities |
|
|
48 |
|
|
|
51 |
|
| Total current liabilities |
|
|
638 |
|
|
|
663 |
|
| Non-current liabilities: |
|
|
|
|
|
|
||
| Pension and other postretirement benefits |
|
|
189 |
|
|
|
192 |
|
| Contract liabilities |
|
|
1 |
|
|
|
1 |
|
| Operating lease liabilities |
|
|
151 |
|
|
|
158 |
|
| Long-term debt |
|
|
2,098 |
|
|
|
2,414 |
|
| Other non-current liabilities |
|
|
101 |
|
|
|
119 |
|
| Total liabilities |
|
|
3,178 |
|
|
|
3,547 |
|
| Commitments and contingencies |
|
|
|
|
|
|
||
| Stockholders’ equity: |
|
|
|
|
|
|
||
| Common stock ($0.0001 par value, 240 million common shares authorized; 71.7 million and 61.2 million outstanding at March 31, 2021 and December 31, 2020, respectively) |
|
|
— |
|
|
|
— |
|
| Additional paid-in capital |
|
|
2,207 |
|
|
|
1,818 |
|
| Accumulated deficit |
|
|
(847 |
) |
|
|
(763 |
) |
| Accumulated other comprehensive loss |
|
|
(114 |
) |
|
|
(120 |
) |
| Total Maxar stockholders' equity |
|
|
1,246 |
|
|
|
935 |
|
| Noncontrolling interest |
|
|
1 |
|
|
|
1 |
|
| Total stockholders' equity |
|
|
1,247 |
|
|
|
936 |
|
| Total liabilities and stockholders' equity |
|
$ |
4,425 |
|
|
$ |
4,483 |
|
| MAXAR TECHNOLOGIES INC. Consolidated Statements of Cash Flows (In millions) |
||||||||
|
|
|
|
|
|
|
|
||
|
|
|
Three Months Ended |
||||||
|
|
|
March 31, |
||||||
|
|
|
2021 |
|
2020 |
||||
| Cash flows (used in) provided by: |
|
|
|
|
|
|
||
| Operating activities: |
|
|
|
|
|
|
||
| Net loss |
|
$ |
(84 |
) |
|
$ |
(48 |
) |
| Income from operations of discontinued operations, net of tax |
|
|
— |
|
|
|
30 |
|
| Loss from continuing operations |
|
|
(84 |
) |
|
|
(78 |
) |
| Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities: |
|
|
|
|
|
|
||
| Impairment loss |
|
|
— |
|
|
|
14 |
|
| Depreciation and amortization |
|
|
74 |
|
|
|
90 |
|
| Amortization of debt issuance costs and other non-cash interest expense |
|
|
4 |
|
|
|
4 |
|
| Stock-based compensation expense |
|
|
11 |
|
|
|
3 |
|
| Loss from early extinguishment of debt |
|
|
41 |
|
|
|
— |
|
| Cumulative adjustment to SXM-7 revenue |
|
|
25 |
|
|
|
— |
|
| Other |
|
|
4 |
|
|
|
(1 |
) |
| Changes in operating assets and liabilities: |
|
|
|
|
|
|
||
| Trade and other receivables |
|
|
3 |
|
|
|
47 |
|
| Accounts payable and liabilities |
|
|
(49 |
) |
|
|
(39 |
) |
| Contract liabilities |
|
|
6 |
|
|
|
(52 |
) |
| Other |
|
|
(8 |
) |
|
|
(1 |
) |
| Cash provided by (used in) operating activities - continuing operations |
|
|
27 |
|
|
|
(13 |
) |
| Cash used in operating activities - discontinued operations |
|
|
— |
|
|
|
(2 |
) |
| Cash provided by (used in) operating activities |
|
|
27 |
|
|
|
(15 |
) |
| Investing activities: |
|
|
|
|
|
|
||
| Purchase of property, plant and equipment and development or purchase of software |
|
|
(50 |
) |
|
|
(60 |
) |
| Return of capital from discontinued operations |
|
|
— |
|
|
|
11 |
|
| Cash used in investing activities - continuing operations |
|
|
(50 |
) |
|
|
(49 |
) |
| Cash used in investing activities - discontinued operations |
|
|
— |
|
|
|
(3 |
) |
| Cash used in investing activities |
|
|
(50 |
) |
|
|
(52 |
) |
| Financing activities: |
|
|
|
|
|
|
||
| Net proceeds of revolving credit facility |
|
|
25 |
|
|
|
15 |
|
| Repurchase of 2023 Notes, including premium |
|
|
(384 |
) |
|
|
— |
|
| Net proceeds from issuance of common stock |
|
|
380 |
|
|
|
— |
|
| Repayments of long-term debt |
|
|
(2 |
) |
|
|
(7 |
) |
| Settlement of securitization liability |
|
|
(3 |
) |
|
|
(4 |
) |
| Other |
|
|
1 |
|
|
|
— |
|
| Cash provided by financing activities - continuing operations |
|
|
17 |
|
|
|
4 |
|
| Cash used in financing activities - discontinued operations |
|
|
— |
|
|
|
(15 |
) |
| Cash provided by (used in) financing activities |
|
|
17 |
|
|
|
(11 |
) |
| Decrease in cash, cash equivalents, and restricted cash |
|
|
(6 |
) |
|
|
(78 |
) |
| Cash, cash equivalents, and restricted cash, beginning of year |
|
|
32 |
|
|
|
109 |
|
| Cash, cash equivalents, and restricted cash, end of period |
|
$ |
26 |
|
|
$ |
31 |
|
|
|
|
|
|
|
|
|
||
| Reconciliation of cash flow information: |
|
|
|
|
|
|
||
| Cash and cash equivalents |
|
$ |
22 |
|
|
$ |
27 |
|
| Restricted cash included in prepaid and other current assets |
|
|
4 |
|
|
|
1 |
|
| Restricted cash included in other non-current assets |
|
|
— |
|
|
|
3 |
|
| Total cash, cash equivalents, and restricted cash |
|
$ |
26 |
|
|
$ |
31 |
|
