The Globe and Mail

Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Press release from CNW Group

/R E P E A T - SiriusXM Canada Delivers Strong Growth in Q1 Fiscal 2013/

Tuesday, January 15, 2013

/R E P E A T - SiriusXM Canada Delivers Strong Growth in Q1 Fiscal 2013/07:00 EST Tuesday, January 15, 2013Record quarterly revenue of $68.9 millionRecord Adjusted EBITDA** of $18.0 million, up 39.4% year-over-year Net Income of $3.3 million, up $6.7 million year-over-yearRecord free cash flow of $13.7 million, up 51.4% year-over-yearTotal Subscribers of 2.2 million; year-over-year net additions of 206,400TORONTO, Jan. 14, 2013 /CNW/ - Canadian Satellite Radio Holdings Inc. ("SiriusXM Canada" or the "Company") (TSX: XSR), parent of Sirius XM Canada Inc., today released unaudited financial results for the quarter ended November 30, 2012 (Q1 FY2013) prepared in accordance with International Financial Reporting Standards (IFRS)1. A summary of IFRS financial results for Q1 F2013 is attached. All results are reported in Canadian dollars unless otherwise stated.Q1 FY2013 Highlights Adjusted EBITDA increased 39.4% to $18.0 million from $12.9 million in Q1 FY2012Self-Paying Subscribers increased 14.3% to 1.6 million from 1.4 million at November 30, 2011Revenue grew 9.2% to $68.9 million from $63.1 million for Q1 FY2012Net income increased to $3.3 million from a loss of $3.4 million in Q1 FY2012Free cash flow increased 51.4% to $13.7 million from $9.1 million for Q1 FY2012Cash and cash equivalents of $64.9 million at November 30, 2012Declared a special cash dividend of $0.0825 per Class A Subordinated Voting Share and $0.0275 per Class B Voting ShareInitiated a quarterly dividend of $0.0825 per Class A Share and Class C Non-Voting Shares and $0.0275 per Class B ShareObtained a six-year broadcast license renewal from the CRTCLaunched Best Of programming, enabling subscribers to access premium content from both the Sirius and XM platformsLaunched enhanced Internet Radio service and mobile listening Apps, that also give subscribers access to on-demand functionality"Fiscal 2013 is off to an excellent start," said Mark Redmond, President and CEO, SiriusXM Canada. "We generated record revenue, Adjusted EBITDA and free cash flow, and received a six-year broadcast license renewal from the CRTC. In addition, with the launch of our Best Of programming, new Internet Radio service and mobile streaming Apps in the quarter, we enhanced and extended our service offering, better positioning the Company for long-term growth. We believe the combination of these premium services, growing new vehicle sales, higher in-vehicle penetration rates and our efforts to better leverage opportunities in the pre-owned car market will fuel our continued success."___________________________ 1 For a complete set of financial results including the accompanying notes please refer to the Company's filings on www.sedar.comFinancial and Operational SummaryBelow, the Company has provided certain non-GAAP measures and industry metrics. These figures are subject to the qualification and assumptions set out in the notes to such results.   Financial *Q1 FY2013Q1 FY2012 (ended November 30, 2012)(ended November 30, 2011) (Unaudited)(Unaudited)Total Revenue$68,891$63,111Adjusted EBITDA**$17,957$12,880Net Income (Loss)$3,258($3,412)   Operating*  Self-Paying Subscribers1,6181,416Total Subscribers2,2212,014Subscriber Acquisition Cost (SAC)$45$54Cost Per Gross Addition (CPGA)$70$83* All figures in the table above are in thousands except, SAC and CPGA** Adjusted EBITDA is a non-GAAP measure. A reconciliation of operating income to both EBITDA and Adjusted EBITDA is provided below."In the quarter, we continued to demonstrate the strong cash generation capabilities of the business, which translated into the announcement of a special dividend and the initiation of a quarterly dividend," said Michael Washinushi, CFO SiriusXM Canada. "We have a stable recurring revenue stream and can clearly manage our costs without sacrificing growth. We remain confident in the Company's ongoing financial strength, operational efficiency and ability to grow free cash flow."Q1 FY2013 Financial Review For Q1 FY2013, revenue was $68.9 million, up $5.8 million, or 9.2%, from $63.1 million in Q1 FY2012 as a result of the continued growth in the Company's revenue-generating subscriber base.SAC was $45 in Q1 FY2013, down from $54 in Q1 FY2012. The year-over-year improvement was due to lower subsidy costs and higher gross additions.CPGA was $70 in Q1 FY2013, down from $83 in Q1 FY2012.  The year-over-year improvement reflects lower subsidy costs and higher gross subscriber additions, which were partially offset by slightly higher marketing costs.Q1 FY2013 Adjusted EBITDA improved to $18.0 million, representing a 39.4%, or $5.1 million, increase, from Adjusted EBITDA of $12.9 million in Q1 FY2012. The year-over-year improvement was a result of the Company's top-line growth, which was offset, in part, by a slight year-over-year increase in operating expenses due to a larger subscriber base.In Q1 FY2013, SiriusXM Canada generated $13.7 million in free cash flow. The Company generated $15.1 million in cash from operations, used cash of $1.4 million in investing activities and generated $0.2 million of cash in financing activities. Comparatively, in Q1 FY2012, SiriusXM Canada generated $9.1 million in free cash flow. The Company generated $10.0 million in cash from operations, used cash of $0.9 million in investing activities and generated $0.1 million of cash in financing activities.As at November 30, 2012, SiriusXM Canada had total cash and cash equivalents of $64.9 million, up from $51.0 million at August 31, 2012.Conference Call and Webcast DetailsSiriusXM Canada will hold a conference call to discuss the Company's Q1 FY2013 results on Tuesday, January 15, 2013 at 8:00 a.m. ET. All interested parties can join the call by dialling 647-427-7450, or 1-888-231-8191. Please dial-in 15 minutes prior to the call to secure a line. The conference call will be archived for replay until Tuesday, January 22, 2013 at midnight. To access the archived conference call, please dial 416-849-0833, or 1-855-859-2056 and enter the reservation code 81448032. A live audio webcast of the conference call will be available at http://www.siriusxm.ca and www.newswire.ca. Please connect at least 15 minutes prior to the conference call to ensure adequate time for any software download that may be required to join the webcast.  An archived replay of the webcast will be available for 365 days at www.newswire.ca.Reconciliations The following is a reconciliation of unaudited EBITDA and unaudited Adjusted EBITDA to Operating Income.    (In $000's)Q1 FY2013Q1 FY2012  (Unaudited)(Unaudited) Operating income8,629281 Amortization8,43410,940 EBITDA17,06311,221 Stock based compensation794394 Integration, severance and merger costs-918 Fair value adjustments*101346 Adjusted EBITDA 17,95712,880 * Fair value adjustment relates to the reduction in revenue due to the valuation of deferred revenue as per purchase price accountingPlease see the Company's Management Discussion & Analysis filed January 14, 2013 for more details on the Company's Q1 FY2013 results. The non-GAAP measures used in this press release should be used in addition to, but not as a substitute for, the analysis provided in the unaudited consolidated statement of operations and comprehensive income. Please see the Company's Management Discussion & Analysis filed January 14, 2013 for complete definition of non-GAAP measures.Forward-Looking StatementsCertain statements included above may be forward-looking in nature. Such statements can be identified by the use of forward-looking terminology such as "expects," "may," "will," "should," "intend," "plan," or "anticipates" or the negative thereof or comparable terminology, or by discussions of strategy. Forward-looking statements include estimates, plans, expectations, opinions, forecasts, projections, targets, guidance, or other statements that are not statements of fact, including with respect to the payment of dividends in the future and future performance. Although SiriusXM Canada believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct, including with respect to the ability of the Company to pay dividends in the future. SiriusXM Canada's forward-looking statements are expressly qualified in their entirety by this cautionary statement. SiriusXM Canada makes no commitment to revise or update any forward-looking statements in order to reflect events or circumstances after the date any such statement is made, except as required by applicable law. Additional information identifying risks and uncertainties is contained in Canadian Satellite Radio Holdings Inc.'s filings with the Canadian securities regulators, available at www.sedar.com.About SiriusXM CanadaCanadian Satellite Radio Holdings Inc. (TSX: XSR) operates as SiriusXM Canada. SiriusXM Canada is the country's leading audio entertainment company and broadcasts more than 120 satellite radio channels featuring premier sports, news, talk, entertainment and commercial-free music. SiriusXM Canada offers an array of content from the most recognized news and entertainment brands as well as from professional sports leagues including the NHL, NFL, MLB and CFL.SiriusXM programming is available on a variety of devices including pre-installed and after-market radios in cars, trucks and boats, smartphones and mobile devices, and consumer electronics products for homes and offices. SiriusXM programming is also available online at www.siriusxm.ca and on Apple, BlackBerry and Android-powered mobile devices.SiriusXM Canada has partnerships with every major automaker and its radio products are available at more than 3,000 retail locations nationwide. To find out more about SiriusXM Canada (TSX: XSR), visit our website at www.siriusxm.ca.CONSOLIDATED INTERIM BALANCE SHEETS (Unaudited)   November 30, August 31,At20122012   ASSETS  Current assets  Cash and cash equivalents64,915,681 51,034,749Accounts receivable  9,115,231 12,133,138Prepaid expenses  2,487,868 3,361,448Inventory266,797 324,316Total current assets76,785,577 66,853,651Long-term prepaid expenses73,390 79,410Property and equipment  7,004,008 7,617,399Intangible assets170,159,759 175,986,331Deferred tax assets58,392,307 59,858,394Goodwill96,732,525 96,732,525Total assets409,147,566 407,127,710   LIABILITIES AND SHAREHOLDERS' EQUITY  Current liabilities  Trade and other payables36,909,753 39,085,800Due to related parties  7,377,591 6,775,601Interest payable  6,291,992 2,704,449Current portion of deferred revenue135,172,973 137,554,399Dividends payable20,333,586 —Provisions  1,435,7281,285,587Total current liabilities207,521,623187,405,836Deferred revenue20,229,088 21,019,320Other long-term liabilities  5,465,686 6,902,537Due to related parties  1,208,332 1,208,332Long-term debt145,226,495 144,992,819Provisions352,184 344,112Total liabilities380,003,408 361,872,956   Shareholders' equity   Share capital148,704,655 148,393,493Contributed surplus  5,711,365 5,057,501Accumulated deficit(125,271,862)(108,196,240)Total shareholders' equity 29,144,158 45,254,754Total liabilities and shareholders' equity409,147,566 407,127,710     CONSOLIDATED INTERIM STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE INCOME (LOSS) (Unaudited) For the three month ended  November 30, 2012November 30,2011    Revenue 68,891,443 63,111,245    Operating expenses    Operating costs 51,828,746 50,971,927 Severance and merger costs — 918,023 Depreciation and amortization 8,434,002 10,940,085Operating income 8,628,695 281,210    Finance costs, net    Interest income 166,351 43,648 Interest expense (3,973,709)(4,343,312) Foreign exchange loss (148,664)(502,049) Gain (loss) on revaluation of derivative 51,378 (28,507)Finance costs (3,904,644)(4,830,220)    Net income (loss) before income tax 4,724,051 (4,549,010)Income tax (expense) recovery (1,466,087)1,137,253Net income (loss) and comprehensive income (loss) 3,257,964 (3,411,757)    Basic and fully diluted (loss)  Income per share 0.03 (0.03)CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Unaudited)     Total ShareContributedAccumulatedShareholders'For the three months endedCapitalSurplusdeficitEquity          Balance, September 1, 2011147,169,430 4,324,032 (104,017,424)47,476,038 Total comprehensive (loss) for the year——(3,411,757)(3,411,757)Stock-based compensation—393,921—393,921Stock options exercised297,375(185,263)—112,112Balance, November 30, 2011147,466,805 4,532,690 (107,429,181)44,570,314           Balance, September 1, 2012148,393,493 5,057,501 (108,196,240)45,254,754 Total comprehensive income for the year——3,257,9643,257,964Stock-based compensation—793,649—793,649Dividends——(20,333,586)(20,333,586)Stock options exercised311,162(139,785)—171,377Balance, November 30, 2012148,704,655 5,711,365 (125,271,862)29,144,158  SOURCE: SiriusXM CanadaFor further information: Morlan Reddock  Sirius XM Canada  416-513-7418  morlan.reddock@siriusxm.ca  Kristen Dickson TMX Equicom 416-815-0700 ext 273 kdickson@tmxequicom.com