Maxar Technologies Reports Second Quarter 2021 Results

Revenues from the Space Infrastructure segment increased to $206 million from $184 million, or by $22 million, for the three months ended June 30, 2021, compared to the same period in 2020. Revenues increased primarily as a result of an increase in revenues from commercial programs of $36 million due to higher volumes related to new programs and lower EAC growth and no COVID-19 program impacts for the three months ended June 30, 2021. The increase is partially offset by a $14 million decrease in revenues from U.S. government contracts.

Adjusted EBITDA from the Space Infrastructure segment increased to $27 million from $11 million, or by $16 million, for the three months ended June 30, 2021, compared to the same period of 2020. The increase in the Space Infrastructure segment was primarily related to a $24 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 June 30, 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. The remaining $8 million change is related to an increase in indirect costs and selling, general and administrative costs.

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 June 30, 2021 increased to $19 million from $12 million, or by $7 million, compared to the same period in 2020. The increase was primarily driven by a $6 million increase in selling, general and administrative costs primarily due to an increase in labor related expenses driven by an increase in headcount and employee compensation.

Intersegment eliminations

Intersegment eliminations are related to projects between our segments, including our WorldView Legion satellite constellation. Intersegment eliminations were $7 million for the three months ended June 30, 2021 and 2020, respectively.

MAXAR TECHNOLOGIES INC.
Consolidated Statements of Operations
(In millions, except per share amounts)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Six Months Ended

 

 

June 30,

 

June 30,

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

Product

 

$

190

 

 

$

157

 

 

$

332

 

 

$

264

 

Service

 

 

283

 

 

 

282

 

 

 

533

 

 

 

556

 

Total revenues

 

 

473

 

 

 

439

 

 

 

865

 

 

 

820

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Product costs, excluding depreciation and amortization

 

 

156

 

 

 

144

 

 

 

304

 

 

 

289

 

Service costs, excluding depreciation and amortization

 

 

100

 

 

 

87

 

 

 

193

 

 

 

180

 

Selling, general and administrative

 

 

88

 

 

 

79

 

 

 

172

 

 

 

147

 

Depreciation and amortization

 

 

73

 

 

 

89

 

 

 

147

 

 

 

179

 

Impairment loss

 

 

 

 

 

 

 

 

 

 

 

14

 

Operating income

 

 

56

 

 

 

40

 

 

 

49

 

 

 

11

 

Interest expense, net

 

 

24

 

 

 

48

 

 

 

102

 

 

 

97

 

Other income, net

 

 

(3

)

 

 

(4

)

 

 

(4

)

 

 

(7

)

Income (loss) before taxes

 

 

35

 

 

 

(4

)

 

 

(49

)

 

 

(79

)

Income tax benefit

 

 

(10

)

 

 

(2

)

 

 

(10

)

 

 

 

Equity in income from joint ventures, net of tax

 

 

 

 

 

(2

)

 

 

 

 

 

(1

)

Income (loss) from continuing operations

 

 

45

 

 

 

 

 

 

(39

)

 

 

(78

)

Discontinued operations:

 

 

 

 

 

 

 

 

 

 

 

 

Income from operations of discontinued operations, net of tax

 

 

 

 

 

2

 

 

 

 

 

 

32

 

Gain on disposal of discontinued operations, net of tax

 

 

 

 

 

304

 

 

 

 

 

 

304

 

Income from discontinued operations, net of tax

 

 

 

 

 

306

 

 

 

 

 

 

336

 

Net income (loss)

 

$

45

 

 

$

306

 

 

$

(39

)

 

$

258

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic net income (loss) per common share:

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) from continuing operations

 

$

0.62

 

 

$

 

 

$

(0.57

)

 

$

(1.29

)

Income from discontinued operations, net of tax

 

 

 

 

 

5.05

 

 

 

 

 

 

5.56

 

Basic net income (loss) per common share

 

$

0.62

 

 

$

5.05

 

 

$

(0.57

)

 

$

4.27

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted net income (loss) per common share:

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) from continuing operations

 

$

0.60

 

 

$

 

 

$

(0.57

)

 

$

(1.29

)

Income from discontinued operations, net of tax

 

 

 

 

 

4.94

 

 

 

 

 

 

5.56

 

Diluted net income (loss) per common share

 

$

0.60

 

 

$

4.94

 

 

$

(0.57

)

 

$

4.27

 

MAXAR TECHNOLOGIES INC.
Consolidated Balance Sheets
(In millions, except per share amounts)

 

 

 

 

 

 

 

 

 

June 30,

 

December 31,

 

 

2021

 

 

2020

 

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

10

 

 

$

27

 

Trade and other receivables, net

 

 

400

 

 

 

327

 

Inventory

 

 

43

 

 

 

31

 

Advances to suppliers

 

 

16

 

 

 

24

 

Prepaid and other current assets

 

 

64

 

 

 

59

 

Total current assets

 

 

533

 

 

 

468

 

Non-current assets:

 

 

 

 

 

 

Orbital receivables, net

 

 

333

 

 

 

361

 

Property, plant and equipment, net

 

 

896

 

 

 

883

 

Intangible assets, net

 

 

840

 

 

 

895

 

Non-current operating lease assets

 

 

151

 

 

 

163

 

Goodwill

 

 

1,627

 

 

 

1,627

 

Other non-current assets

 

 

90

 

 

 

86

 

Total assets

 

$

4,470

 

 

$

4,483

 

Liabilities and stockholders’ equity

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

112

 

 

$

115

 

Accrued liabilities

 

 

63

 

 

 

65

 

Accrued compensation and benefits

 

 

76

 

 

 

105

 

Contract liabilities

 

 

272

 

 

 

278

 

Current portion of long-term debt

 

 

13

 

 

 

8

 

Current operating lease liabilities

 

 

42

 

 

 

41

 

Other current liabilities

 

 

45

 

 

 

51

 

Total current liabilities

 

 

623

 

 

 

663

 

Non-current liabilities:

 

 

 

 

 

 

Pension and other postretirement benefits

 

 

186

 

 

 

192

 

Contract liabilities

 

 

 

 

 

1

 

Operating lease liabilities

 

 

144

 

 

 

158

 

Long-term debt

 

 

2,121

 

 

 

2,414

 

Other non-current liabilities

 

 

96

 

 

 

119

 

Total liabilities

 

 

3,170

 

 

 

3,547

 

Commitments and contingencies

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

Common stock ($0.0001 par value, 240 million common shares authorized; 72.4 million and 61.2 million outstanding at June 30, 2021 and December 31, 2020, respectively)

 

 

 

 

 

 

Additional paid-in capital

 

 

2,211

 

 

 

1,818

 

Accumulated deficit

 

 

(803

)

 

 

(763

)

Accumulated other comprehensive loss

 

 

(109

)

 

 

(120

)

Total Maxar stockholders' equity

 

 

1,299

 

 

 

935

 

Noncontrolling interest

 

 

1

 

 

 

1

 

Total stockholders' equity

 

 

1,300

 

 

 

936

 

Total liabilities and stockholders' equity

 

$

4,470

 

 

$

4,483

 

MAXAR TECHNOLOGIES INC.
Consolidated Statements of Cash Flows
(In millions)

 

 

 

 

 

 

 

 

Six Months Ended

 

 

June 30,

 

 

2021

 

2020

 

Cash flows (used in) provided by:

 

 

 

 

 

Operating activities:

 

 

 

 

 

Net (loss) income

 

$

(39

)

$

258

 

Income from operations of discontinued operations, net of tax

 

 

 

 

32

 

Gain on disposal of discontinued operations, net of tax

 

 

 

 

304

 

Loss from continuing operations

 

 

(39

)

 

(78

)

Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities:

 

 

 

 

 

Depreciation and amortization

 

 

147

 

 

179

 

Stock-based compensation expense

 

 

21

 

 

13

 

Amortization of debt issuance costs and other non-cash interest expense

 

 

7

 

 

8

 

Loss from early extinguishment of debt

 

 

41

 

 

7

 

Cumulative adjustment to SXM-7 revenue

 

 

25

 

 

 

Impairment loss

 

 

 

 

14

 

Other

 

 

9

 

 

2

 

Changes in operating assets and liabilities:

 

 

 

 

 

Trade and other receivables

 

 

(72

)

 

40

 

Accounts payable and liabilities

 

 

(60

)

 

(65

)

Contract liabilities

 

 

(6

)

 

(38

)

Other

 

 

(23

)

 

(16

)

Cash provided by operating activities - continuing operations

 

 

50

 

 

66

 

Cash used in operating activities - discontinued operations

 

 

 

 

(30

)

Cash provided by operating activities

 

 

50

 

 

36

 

Investing activities:

 

 

 

 

 

Purchase of property, plant and equipment and development or purchase of software

 

 

(105

)

 

(128

)

Return of capital from discontinued operations

 

 

 

 

20

 

Cash used in investing activities - continuing operations

 

 

(105

)

 

(108

)

Cash provided by investing activities - discontinued operations

 

 

 

 

723

 

Cash (used in) provided by investing activities

 

 

(105

)

 

615

 

Financing activities:

 

 

 

 

 

Repurchase of 2023 Notes, including premium

 

 

(384

)

 

(169

)

Net proceeds from issuance of common stock

 

 

380

 

 

 

Net proceeds from Revolving Credit Facility

 

 

53

 

 

 

Net proceeds from issuance of 2027 Notes

 

 

 

 

147

 

Settlement of securitization liability

 

 

(6

)

 

(7

)

Repayments of long-term debt

 

 

(4

)

 

(521

)

Other

 

 

(6

)

 

1

 

Cash provided by (used in) financing activities - continuing operations

 

 

33

 

 

(549

)

Cash used in financing activities - discontinued operations

 

 

 

 

(24

)

Cash provided by (used in) financing activities

 

 

33

 

 

(573

)

(Decrease) increase in cash, cash equivalents, and restricted cash

 

 

(22

)

 

78

 

Effect of foreign exchange on cash, cash equivalents, and restricted cash

 

 

 

 

(5

)

Cash, cash equivalents, and restricted cash, beginning of year

 

 

32

 

 

110

 

Cash, cash equivalents, and restricted cash, end of period

 

$

10

 

$

183

 

 

 

 

 

 

 

Reconciliation of cash flow information:

 

 

 

 

 

Cash and cash equivalents

 

$

10

 

$

179

 

Restricted cash included in prepaid and other current assets

 

 

 

 

1

 

Restricted cash included in other non-current assets

 

 

 

 

3

 

Total cash, cash equivalents, and restricted cash

 

$

10

 

$

183

 


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