MDA Space (MDA) Jefferies Global Industrial Conference summary

Industry trends and market outlook

• Space sector is experiencing strong, steady growth, forecasted to reach $1.8 trillion by 2035, driven by declining launch costs and expanding commercial opportunities.

• Key growth drivers include global connectivity, commercial space stations, and increased defense presence in space.

• On-orbit industrialization is emerging, with applications in pharmaceuticals, material sciences, and power generation.

• Market consolidation is expected as some startups lose momentum and larger players consider divesting non-core assets.

• Regulatory changes, especially around debris mitigation, are increasing demand for on-orbit servicing and active debris removal.

Business performance and financials

• Revenue has doubled since 2020, with 2024 forecasted to exceed CAD 1 billion and a 19%-20% EBITDA margin.

• Backlog has grown to over CAD 4.5 billion, supporting sustained 25%-30% annual growth for the next 3-5 years.

• Operating cash flow is strong, with 75%-80% of EBITDA converted to cash, enabling rapid deleveraging and a net cash positive position expected by end of 2024.

• Capital investments of CAD 200 million+ per year are ongoing through 2025, then expected to normalize at CAD 100 million annually.

• Pipeline of over CAD 20 billion in opportunities, mainly in satellite systems, supports future growth.

Business areas and growth drivers

• Satellite systems are the largest and fastest-growing segment, driven by LEO and MEO constellation contracts like Telesat Lightspeed and Globalstar.

• Robotics is the second growth driver, with major contracts for lunar missions and commercial derivatives like MDA Skymaker.

• Geointelligence remains steady, with upcoming growth from the CHORUS next-generation Earth observation satellite.

• Vertical integration and legacy experience provide competitive advantages, enabling full-solution offerings and flexibility.

• Expansion into new geographies and potential M&A are being considered to secure technology and increase capacity.