MDA posted a strong first quarter of 2023 while its CEO praised the Canadian government for its new spending on space.
MDA manages the Canadarm robotic arm series, which includes Canadarm2 on the International Space Station and the forthcoming Canadarm3 on NASA’s planned Gateway space station at the Moon. Canadarm3’s contribution helped fund Jeremy Hansen’s seat aboard Artemis 2, as well as future Artemis program missions and science. Canadarm2 does the same for the ISS.
The new Canadian government space funding, announced in March during Budget 2023, includes $1.1 billion over 14 years to extend Canada’s participation in the ISS to 2030 and $76.5 million over eight years to support Gateway science. MDA is of course involved both at the ISS and at Gateway.
CEO Mike Greenley also spoke to new government funding for a just-announced lunar utility vehicle ($1.2 billion over 13 years) in a phone call with analysts Friday (May 12). The funding for these programs, he added, “signals Canada and tech to support human lunar activity. Our team is looking forward to leveraging MDA’s successful track record to play a meaningful role on all of these missions.”
MDA is continuing design work on Phase B of the Canadarm3 contract, which the company received in early 2022. “That will see us completing the preliminary design review of the Canadarm3 robotic system,” Greenley said. “The team is making good progress, successfully closing out the systems definition review in Q1.”
The ISS continues to provide recurring revenue for MDA, Greenley noted, and proposals are forthcoming “to extend our contractual frameworks” to top up the existing contract through Canada’s ISS extended commitment. As for the rover, Greenley said MDA is interested in the project’s scope, and praised the CSA for its planned consultations with industry to get ideas.
“Our ambitions are always strong on large programs, so we will be looking at the vital leadership role for ourselves in a program of that nature,” Greenley noted.
There’s much more activity in which MDA is involved as well. Other highlights that Greenley mentioned included a 14 percent year-over-year growth in the U.S. Space Force budget, which is a signal of what MDA sees as “demand for space-based surveillance and detection systems.” (MDA has Earth observation satellites that can be used for this purpose, based on experience honed over decades with the Radarsat series.)
In low Earth orbit, MDA is fielding “multiple requests for communication satellite solutions, and for a growing number of constellation projects,” Greenley said, citing Globalstar as one of the key contracts. The geointelligence business is also growing, with Greenley saying the company’s CHORUS Earth observation constellation is continuing unit and subsystem work following its critical design review completion in Q4. The Canadian Surface Combatant Program is also progressing; MDA is responsible for the design and integration of the electronic warfare system.
The company hired more than 800 people in the last fiscal year and now has 2,700 staff, Greenley noted. One of the focuses has been continuing to work around supply chain shortages, including measures such as finding alternatives, ordering early and increasing inventory where possible.
In past updates, MDA has emphasized it has room to wait on one of the projects in which it is involved and which has been affected by the supply chain: Telesat’s Lightspeed constellation, which is seeking more funding due to inflation. Telesat’s quarterly results yesterday included no large updates on that front, except CEO Dan Goldberg saying financing discussions are “making headway” since annual results were announced about six weeks ago.
MDA reported revenues of $201.9 million in Q1, up 57 percent year over year, with adjusted EBITDA up 10 percent to $48.9 million. MDA also listed a backlog of $1.2 billion at quarter’s end, and a quarterly operating cash flow of $45.8 million – triple the $14.7 million seen in Q1 2022.