Q4 2024 MDA Ltd Earnings Call

Operator: Good morning, ladies and gentlemen. Welcome to MDA Space conference call and webcast. Call is being recorded on March 7, 2025 at 8.30 a.m.

Good morning, ladies and gentlemen, welcome to M. D. A space conference call and webcast. This call is being recorded on March seven 2025 at 830, a M eastern time.

Operator: Following the presentation, we will conduct a question and answer session. All of these questions will be provided at that time for you to queue up for questions. For those viewers listening via webcast, please note that the company will be using a present Webcast viewers can advance the slides by using the arrows seen in the presentation.

During the presentation, we will conduct a question and answer session and instructions will be provided at that time for you to queue up for questions. So those yours listening via webcast. Please note that the company will be using a presentation webcast viewers can advance the slides by using the arrows seen in the presentation window.

Operator: If anyone has difficulties hearing the conference call 1-866-333-4242.

Howie: If anyone has difficulty hearing the conference. Please press star followed by zero for operator assistance at any time I'd now like to turn the call over to sharing so Howie head of Investor Relations at M D space.

Shereen Zahawi: Press star followed by zero for operator assistance at any I'd now like to turn the call over to Shereen Zahawi, Head of Investor Relations at MNBC. Thank you, Operator.

Speaker Change: Thank you operator, good morning, and welcome to M D. A space fourth quarter and full year 2024 earnings call My Greeley, our CEO and Jan Blah Blah, our CSO will lead todays call and share some prepared remarks before taking your questions.

Shereen Zahawi: Good morning and welcome to MDA Space fourth quarter and full year 2024 earnings call. Mike Greenley, our CEO, and Guillaume Lavoie, our CFO, will lead today's call and share some prepared remarks before taking your questions.

Shereen Zahawi: A couple of housekeeping items before we begin. Today's call is accessible via webcast on our Investor Relations website. All our disclosures, including the press release, MD&A, and financial statements, are available from our Investor Relations website and from CDAR+.

Speaker Change: Couple of housekeeping items before we begin today's call is accessible via webcast on our Investor Relations website, all our disclosures, including the press release MD&A and financial statements are available from our Investor Relations website and from SEDAR plus.

Shereen Zahawi: I would also like to remind you that today's call will include estimates and other forward looking information which may differ from actual results. Please review the cautionary language in today's press release and public filings regarding various factors, assumptions and risks that could cause actual results to differ.

Speaker Change: I would also like to remind you that today's call will include estimates and other forward looking information, which may differ from actual results. Please review the cautionary language in today's press release and public filings regarding various factors assumptions and risks that could cause actual results to differ. In addition, during this call we will refer to certain non.

Shereen Zahawi: In addition, during this call we will refer to certain non-IFRS financial measures. Although we believe these measures provide useful supplemental information about our financial performance, these measures do not have any standardized meaning under IFRS and our approach in calculating these measures may differ from that of other issuers and therefore may not be directly comparable. Please see the company's quarterly report and other public filings for more information about these measures including reconciliations to the nearest IFRS measures.

Speaker Change: As far as financial measures. Although we believe these measures provide useful supplemental information about our financial performance. These measures do not have any standardized meaning under ifr S and our approach in calculating these measures may differ from that of other issuers and therefore may not be directly comparable please see the company's quarterly.

Speaker Change: For it and other public filings for more information about these measures, including reconciliations to the nearest ifr S measures and with that it's my pleasure to turn the call over to Mike.

Mike Greenley: And with that, it's my pleasure to turn the call over to Mike. Thank you, Shereen. Good morning, everyone. And thank you to those joining us today to discuss our fourth quarter and full year 2024 financial results. There's a lot to share today as we finish one year and guide to another. So bear with us and we will get through a lot of information.

Mike: Thank you Sherry good morning, everyone and thank you to those joining us today to discuss our fourth quarter and full year 2024 financial results. There's a lot to share today as we finish it in one year and guide to another.

Mike: Bear with us and we will get through a lot of information.

Mike Greenley: Before we get into our Q4 update, I want to start by acknowledging and thanking the MDA Space Team for delivering another strong year of performance. Our team delivered for our customers, our shareholders, and our company with strong growth and execution, further solidifying our position as a trusted mission partner and leader in the expanding space industry. In 2024, we secured $2.4 billion in new awards, which included the next phases of Canadarm3 in addition to other strategic awards across the three business areas. We grew our revenues to $1.1 billion, an increase of 34% year-over-year, and expanded our adjusted EBITDA to $217 million, up 25% versus last year's levels, exceeding our guidance for the year for these two metrics.

Mike: Before we get into our Q4 update I want to start by acknowledging and thanking the MDA space team.

Mike: Team, for delivering another strong-year performance. Our team delivered for our customers, our shareholders, and our company, with strong growth and execution, further solidifying our position as a trusted mission partner and leader in the expanding space industry.

Mike: In 2024, we secured $2.4 billion in new awards, which included the next phases of Canada Arm 3, in addition to other strategic awards across the three business areas.

Mike: We grew our revenues to $1.1 billion and increase up 34% year-over-year and expanded our adjusted EBITDA to 217 million, up 25% versus last year's levels, exceeding our guidance for the year

Mike Greenley: Our full year adjusted EBITDA margin of 20% was robust and in line with our expectations. We generated operating cash flow of $816 million and free cash flow of $615 million, consistent with our expectations to turn free cash flow positive one year ahead of our prior plan. Throughout the year, our teams continue to execute well on our programs, with notable developments including the successful completion of the Preliminary Design Review for the Telesat Lightspeed LEO Constellation Program, a critical milestone for that program. We also continue to advance the manufacturing of MDA Quorus, our next generation Earth Observation Constellation.

Mike: Our full-year adjusted EBITDA margin of 20% was robust and in line with our expectations.

Mike: We generated operating cashflow of $816 million and free cashflow of $615 million, consistent with our expectations to turn free cashflow positive one year ahead of our prior plan.

Mike: Throughout the year, our teams continue to execute well in our programs, with notable developments, including the successful completion of the preliminary design review for the Telosad Lightspeed Leo Constellation program, a critical milestone for that program. We also continue to advance the Manufacturing of MDA Chorus, our next generation Earth Observation Constellation.

Mike Greenley: Additionally, the MDA space team also successfully conducted the preliminary design review for the Canadarm3 program, another important engineering milestone.

Mike: Additionally, the MDA Space Team also successfully conducted the preliminary design review for the Canada Armed 3 program, another important engineering milestone.

Mike Greenley: Operationally, to support current and future growth, we continued to focus on talent and recruitment. And in 2024, we added approximately 950 new staff. We also deployed $200 million in capital expenditures, which included research and development spending on technologies related to MDA Chorus and other growth initiatives. Our research and development efforts are a critical differentiator for MDA Space.

Mike: Operationally, to support current and future growth, we continue to focus on talent and recruitment and in 2024, we added approximately 950 new staff.

Mike: We also deployed $200 million in capital expenditures, which included research and development spending on technologies related to MDA chorus and other growth initiatives.

Mike: Our research and development efforts are a critical differentiator for MDA space, market research firm, research info stores which is focused on the Canadian R&D ecosystem, recently ranked MDA space as 33rd in its ranking of Canada's top 100 corporate R&D spenders based on 2023 data.

Mike Greenley: Market research firm, Research InfoSource, which is focused on the Canadian R&D ecosystem, recently ranked MDA Space as 33rd in its ranking of Canada's top 100 corporate R&D spenders based on 2023 data.

Mike Greenley: Q4, and the subsequent period, was also a busy one for MDA Space. In Q4, the MDA Space Team delivered another strong quarter driven by solid execution. Our Q4 revenues totaled $347 million, up 69% year-over-year. Adjusted EBITDA was $71 million, up 68% versus last year. And adjusted EBITDA margin was a solid 20.5%. Operating cash flow was strong at $383 million and we ended the quarter in a net cash positive position as we continue to deliver our balance sheet. Our backlog of $4.4 billion at quarter-end provides us with good revenue visibility for 2025 and beyond. Recent awards bring our backlog closer to the $5 billion level today.

Mike: Q4 and the subjectment period was also a busy one for MDA space.

Mike: In Q4, the MDA Space Team delivered an all another strong quarter driven by solid execution.

Mike: Our Q4 revenues totaled $347 million, up 69% year-over-year. Adjusted EBITDA was $71 million, up 68% versus last year, and adjusted EBITDA in margin was a solid 20.5%

Mike: Operating cashflow was strong at $383 million and we ended the quarter in a net cash positive position as we continue to deliver our balance sheet.

Mike: or D. Laversory, our balance sheet. Our backlog of $4.4 billion at quarter end provides us with good revenue visibility for 2025 and beyond. Recent awards bring our backlog closer to the $5.00 billion level today.

Mike Greenley: We continue to make progress on our major programs, including Telesat Lightspeed, Canadarm3, MDA Chorus, and Globalstar.

Mike: We continue to make progress on our major programs, including Teleside Lightspeed, Canada R3, MDA Chorus, and Global Star.

Mike Greenley: Post-quarter end, we announced that MDA Space has been awarded a $1.1 billion follow-on contract from Globalstar to manufacture its next generation low-Earth orbit constellation which will include over 50 MDA Aurora digital satellites. This is our third LEO Constellation contract in three years and the second Constellation with Globalstar, further highlighting the continued momentum we are seeing in our satellite systems business, driven by strong customer demand for our differentiated technology.

Mike: Post Quarter End, we announced the MDA Space has been awarded a $1.1 billion dollar follow-on contract from the Global Star to manufacture its next generation, lower of orbit constellation which will include over 50 MDA Aurora digital satellites.

Mike: This is our third Leo Constellation contract in three years and the second Constellation with Global Star further highlighting the continued momentum we are seen in our satellite systems business driven by strong customer demand for our differentiated technology.

Mike Greenley: In summary, 2024 was another year of strong growth for MDA Space, and I am extremely proud of how the team executed. With the growing space market as our backdrop, today we are introducing our 2025 Financial Outlook. We expect 2025 to be another year of strong growth for the company. For the full year, we expect revenues to be $1.5 billion to $1.65 billion, representing year-over-year growth of approximately 45% at the midpoint of that guidance. We expect full-year adjusted EBITDA to be $290-$320 million, representing year-over-year growth of approximately 40% at the midpoint of guidance and approximately 19-20% adjusted EBITDA margin.

Mike: In summary, 2024 was another year of strong growth for MDA space, and I am extremely proud of how the team executed.

Mike: With the growing space market as our backdrop, today we are introducing our 2025 financial outlook.

Mike: We expect 2025 to be another year of strong growth for the company. For the full year we expect revenues to be 1.5 billion to 1.65 billion dollars, representing year-over-year growth of approximately 45% at the midpoint of that guidance.

Mike: We expect Folier Adjusted EBITDA to be $290 to $320 million, representing the year-over-year growth of approximately 40% at the midpoint of guidance, and approximately 19% to 20% adjusted EBITDA margin.

Mike Greenley: We expect capital expenditures to be $210 to $240 million as we continue to invest in our growth initiatives. We also expect free cash flow to be neutral to positive for the full year. As we look to 2025, the team is energized. By the strong momentum and positive trends we are seeing in our end markets, an MDA space has the right technology portfolio to capitalize on the opportunities ahead of it.

Mike: We expect capital expenditures to be $210 to $240 million, as we continue to invest in our growth initiatives. We also expect free cash flow to be neutral to positive for the full year.

Mike: As we look to 2025, the team is energized. By the strong momentum and positive trends we are seeing in our end markets, an MDA space has the right technology portfolio to capitalize on the opportunities ahead of us.

Mike Greenley: I'll now give you a view of the industry, an update on our three business areas, and then I'll pass it to Guillaume for a deep dive on the financials. Starting with the global space market, 2024 was another strong year for space. with research firm NovaSpace, estimating the space economy grew to $596 billion last year, up from $509 billion in the prior year. Governments around the globe continue to invest in space, with government space investments reaching approximately $135 billion in 2024, up 10% year-over-year. Governments continue to allocate a higher share of their space budgets to defense programs, which today comprise the majority of budgets at $73 billion, or 54%.

Speaker Change: I'll now give you a view of the industry. An update on our three business areas, and then I'll pass it to Guillaume for a deep dive on the financials.

Speaker Change: Starting with the global space market, 2024 was another strong year for space, with research from NOBA space estimating the space economy grew to $596 billion last year, up from $509 billion in the prior year.

Mike Greenley: Underscoring space's growing importance as a contested and strategic domain. We are seeing increased integration of space-based capability as a routine component of defense and military budgets driven by geopolitical tensions and demand for space-based surveillance and detection systems. Looking at the big picture, NOVA Space estimates the size of the global space economy will grow to $944 billion a year by 2033, while other recent forecasts, including those from the World Economic Forum, project that the space economy will almost triple by 2035, driven by lower costs and wider access to space-enabled technologies.

Mike Greenley: In addition, we continue to see growing global interest in space exploration. In 2024, NASA added 19 new signatories to its Artemis Accords, signaling these countries' commitment to safe, long-term, and ethical space exploration. As of March 2025, 53 nations have signed up to the Artemis Accords. The Accords, which was unveiled in October 2020 to align nations on a common set of principles for space exploration, has steadily grown in size over the last four years, with interest from many non-traditional spacefaring nations which are now building their own national space programs. In terms of space infrastructure, spacecraft launch activity continued to unfold at a robust pace.

Speaker Change: In terms of space infrastructure spacecraft launch activity continue to unfold at a robust pace in 2024, there were a total of 259 orbital launches up 18% versus 2023.

Mike Greenley: In 2024, there were a total of 259 orbital launches, up 18 percent versus 2023. A total of 2,863 spacecraft launched globally, consistent with the levels seen in 23. Communication satellites continue to dominate in terms of service type, comprising close to 77% of all spacecraft launched last year, driven primarily by growth in commercial low-Earth orbit constellations.

Speaker Change: A total of 2863 spacecraft launch globally consistent with the levels seen in 'twenty three.

Speaker Change: Communications satellites continue to dominate in terms of service type comprising close to 77% of all spacecraft launch last year, driven primarily by growth in commercial lower orbit constellations.

Mike Greenley: All of this activity bodes well for MDA Space and our future opportunity set, which we estimate today to be in excess of $20 billion of opportunity in cumulative pipeline over the next five years.

Speaker Change: All of this activity bodes well for MDA space, and our future opportunity set which we estimate today to be in excess of $20 billion of opportunity and cumulative pipeline over the next five years.

Mike Greenley: Now I'll turn to our three business areas. In satellite systems, we continue to see good momentum in this market, with our teams working to advance multiple requests for communication satellite solutions and a growing number of constellation projects. We are also seeing good activity levels from customers and our opportunity funnel remains strong.

Speaker Change: Now I will turn to our three business areas.

Speaker Change: And satellite systems, we continue to see good momentum in this market with our teams working to advance multiple requests for communications satellite solutions and a growing number of constellation projects.

Speaker Change: We're also seeing good activity levels from customers in our opportunity funnel remains strong.

Mike Greenley: In Q4, our teams were busy advancing work on a number of programs. On the Telesatellite Speed Program, as I mentioned earlier, we completed the Preliminary Design Review, or PDR, which is a critical checkpoint in the program. The successful PDR completion demonstrates maturity in the design that meets the program's functional and performance requirements. As part of the process, the PDRs from multiple key subsystems have also been successfully completed. The teams are now transitioning to the program's detailed engineering and manufacturing phase, including the critical design review, which is taking place later this year. With all critical subsystem suppliers now under contract, this sets the stage for work volumes to accelerate in 2025, consistent with our program plans.

Speaker Change: In Q4, our teams were busy advancing and work on a number of programs.

Speaker Change: Telesat Lightspeed program as I mentioned earlier, we completed the preliminary design review or PDR, which is a critical checkpoint in the program. The successful PDR completion demonstrates maturity and a design that meets the program's functional and performance requirements.

Speaker Change: As part of the process the <unk> for multiple key sub systems have also been successfully completed.

Speaker Change: The teams are now transitioning to programs detailed engineering and manufacturing phase, including the critical design review, which is taking place later this year.

Speaker Change: With all critical sub system suppliers now under contract. This sets the stage for work volumes to accelerate in 2025, consistent with our program plans.

Mike Greenley: We also announced post-quarter-end that MDA Space has been selected by Globalstar to be the prime contractor for the satellite operator's next-generation LEO constellation, where MDA Space will manufacture more than 50 MDA Aurora software-defined digital satellites. The contract, valued at approximately $1.1 billion, is a follow-on to an initial authorization to proceed contract we had previously announced on November 17, 2023 with an undisclosed customer. Approximately $350 million of the $1.1 billion contract value was added to backlog in 2023 and 2024 as part of the ATP. The team is making good progress on the engineering, development, and program procurement activities for the program and has successfully completed the Preliminary Design Review with work now transitioning towards the Critical Design Review taking place in the second half of this year.

Speaker Change: We also announced post quarter end that MDA space has been selected by globalstar to be the prime contractor for the satellite operators next generation Leo constellation, where MBA space will manufacture more than 50 M. D. Aurora software defined digital satellites.

Speaker Change: The contract valued at approximately $1 1 billion as a follow on to an initial authorization to proceed contract. We have previously announced on November 17th 2023, with an undisclosed customer.

Speaker Change: Approximately $350 million of the $1 1 billion contract value was added to backlog in 2023 and 2024 as part of the ATP.

The team is making good progress on the engineering development and program procurement activities for the program and has successfully completed the preliminary design review with work now transitioning towards the critical design review taking place in the second half of this year.

Mike Greenley: We also continue to advance work on the initial GlobalSTAR program, where MDA spaces the prime contractor to enhance GlobalSTAR's LEO constellation through the addition of 17 satellites, which support SOS features and direct-to-device communication on certain Apple products. In Q4, the team progressed flight hardware production and flat sat testing of the bus and payload systems. The team continues to advance satellite integration work following a successful spacecraft integration readiness review.

Speaker Change: We also.

Speaker Change: Continue to advance work on the initial Globalstar program, where MBA space as the prime contractor to enhance globalstar as Leo constellation through the addition of 17 satellites, which support Sos features a directed device communication on certain Apple products.

Speaker Change: In Q4, the team progressed flight hardware production and flats that testing of the bus and payload systems. The team continues to advance satellite integration work following a successful spacecraft integration readiness review.

Mike Greenley: We are also making good progress on our facility expansion in Quebec, which will add 185,000 square feet to our existing satellite production facility. The building shell has now been completed, and construction has commenced on the interior elements of the facility. Once complete, it will be the world's largest high-volume manufacturer facility in its satellite class, with capacity to deliver two MDA Aurora digital satellites per day. The production line is expected to be operational in the second half of 2025.

Speaker Change: We're also making good progress on our facility expansion in Quebec, which will add 185000 square feet to our existing satellite production facility.

Speaker Change: The building shell has now been completed and construction has commenced on the interior elements of the facility.

Speaker Change: Once complete it will be the world's largest high volume manufacturing facility and its satellite class with capacity to deliver to MDA Aurora digital satellites per day there.

Speaker Change: The production line is expected to be operational in the second half of 2025.

Mike Greenley: Moving to our robotics and space operations business, we continue to see good traction and activity levels on both the government and commercial fronts. In Q4, we continued to ramp up work volumes on Phase C, which we were awarded along with Phase D in June 2024 for the Canadarm3 program. Phase C will see us completing the final design, whereas Phase D covers the construction, system assembly, integration and test of the full robotic system, as well as a ground segment for command and control. MDA Space will support commissioning of the Canadarm3 robotic system once in orbit from our new mission control facility at our global headquarters and Space Robotics Center of Excellence in Brampton, Ontario.

Speaker Change: Moving to our robotics and space operations business, we continue to see good traction and activity levels on both the government and commercial fronts.

Speaker Change: In Q4, we continued to ramp up work volumes on Phase C, which we were awarded along with Phase D. In June 2024 for the Canadarm III program.

Speaker Change: You will see us completing the final design, whereas phase D covers their construction system Assembly integration and test of the full robotic system as well as a ground segment for command and control.

Speaker Change: NBA space will support commissioning of the Canada arm three robotic system once in orbit from our new mission control facility at our global headquarters in Space Robotics Center of excellence in Brampton, Ontario.

Mike Greenley: The contract also includes planning and personnel training in preparation for on-orbit mission operations.

Speaker Change: The contract also includes planning and personnel training and preparation for on orbit mission operations.

Mike Greenley: On the commercial side, we continue to explore opportunities to incorporate our robotic technology on applications to support space exploration and lunar mobility. During the quarter, we progressed the design and development of the MDA Skymaker robotics for the Lunar Outpost Lunar Terrain Vehicle Services contract with NASA. We also supported the successful Starlab Commercial LEO Space Station PDR with NASA, and successfully conducted lunar mobility field trials at the Canadian Space Agency.

Speaker Change: On the commercial side, we continue to explore opportunities to incorporate our robotic technology on applications to support space exploration and lunar mobility.

Speaker Change: During the quarter, we progressed the design and development of the MDA Sky maker robotics for the lunar outpost lunar terrain vehicle services contract with NASA.

Speaker Change: We also supported the successful Star lab commercial aerospace station PDR with NASA and successfully conducted lunar mobility field trials at the Canadian Space Agency.

Mike Greenley: Moving to our geointelligence business, customer demand for our Earth observation offering remains robust, and we are seeing increased recognition of the role that commercial Earth observation satellites can play to provide near real-time data and analytics to governments and private enterprise. In Q4, we continue to enjoy strong demand for RadarSat-2 data and analytics, with more than 20 contract awards from a broad range of commercial, space agency, and other government customers globally, with contracts ranging in value from low to high single-digit millions. We also received our first task order under NASA's Commercial SmallSat Data Acquisition Program, created to help acquire Earth observation data and provide related services for the agency.

Speaker Change: Moving to our Geo intelligence business customer demand for our Earth observation operating remains robust and we are seeing increased recognition of the role that commercial Earth observation satellites can play to provide near real time data and analytics to governments and private enterprise and.

Speaker Change: In Q4, we continued to enjoy strong demand for radar sought to data and analytics with more than 20 contract awards from a broad range of commercial space agency and other government customers globally with contracts ranging in value from low to high single digit millions we.

Speaker Change: We also received our first task order under Nasa's commercial small sat data acquisition program created to help acquire Earth observation data and provide related services for the agency.

Mike Greenley: We also continued to work on MDA Chorus. The MDA space team fit harnesses in the main spacecraft body and progressed the integration of the first of four synthetic aperture radar antenna panels. Our solar array assemblies are complete and have started their acceptance tests. We are now well into a busy first quarter where we plan to test and characterize the first SAR antenna panel and expect authorized shipment of the solar arrays to our facility. Overall, we are pleased with the progress to date on MDA Chorus and continue to see strong interest from existing customers and new prospective customers, and business development discussions continue to accelerate.

Speaker Change: We also continued to work on NDA of course, the MBA space team fit harnesses in the main spacecraft body and progress of the integration of the first of four synthetic aperture radar antenna panels are solar array assemblies are complete and have started their acceptance tests. We are now.

Speaker Change: Well into a busy first quarter, where we plan to test and characterize the first SAR incentive panel and expect to authorized shipment of the solar arrays to our facility.

Overall, we are pleased with the progress to date and MBA course, and continue to see strong interest from existing customers and new prospective customers and business development discussions continue to accelerate.

Mike Greenley: We are excited to deliver MDA Chorus enhanced functionality to all of our current and future customers.

Speaker Change: We're excited to deliver MBA course enhanced functionality to all of our current and future customers.

Mike Greenley: Shifting to operations. In 2024, the team completed the move to our new global headquarters and Space Robotics Centre of Excellence in Brampton, Ontario. The purpose-built facility features state-of-the-art labs, manufacturing, R&D, and assembly, integration, and test facilities. The Centre of Excellence also houses a unique Space Robotics Mission Control Centre, enabling MDA to provide critical on-orbit operation capabilities to commercial and government customers worldwide.

Speaker Change: Shifting to operations in 2024, the team completed the move to our new Global headquarters in Space Robotics Center of excellence in Brampton, Ontario.

Speaker Change: The purpose built facility features state of their labs manufacturing R&D and assembly integration and test facilities. The centre of Excellence also houses a unique space Robotics mission control center, enabling MDA to provide critical on orbit operation capabilities to commercial and government customers worldwide.

Mike Greenley: I also wanted to take this opportunity to offer some thoughts on the recently imposed U.S. tariffs and counter-tariffs announced by the Canadian government. While the situation remains fluid, we have been actively engaging government and regulatory bodies in both the U.S. and Canada regarding tariff mechanics and have conducted a thorough review of our active contracts and ongoing proposals. We believe our potential tariff exposure is manageable. At the end of Q4, approximately 90% of our backlog of $4.4 billion derived from geographies outside of the U.S. And when we look at our supply chain, particularly for our satellite manufacturing business, it's well diversified globally, with a little over a quarter, 25%, of suppliers based in the U.S.

Speaker Change: I also wanted to take this opportunity to offer some thoughts on the recently imposed U S tariffs and counter tariffs announced by the Canadian government.

Speaker Change: While the situation remains fluid we have been actively engaging government and regulatory bodies in both the U S and Canada regarding tariff tariff mechanics, and have conducted a thorough review of our active contracts and ongoing proposals. We believe are potential tariff exposure is manageable.

Speaker Change: At the end of Q4, approximately 90% of our backlog of $4 4 billion derived from geographies outside of the U S and we'd look at ours and when we looked at our supply chain, particularly for our satellite manufacturing business, its well diversified globally with a little over a quarter of 25.

Speaker Change: <unk> a suppliers based in the U S.

Mike Greenley: clearly demonstrating the benefits of being a global space business. In addition, we are encouraged by our customers' collaborative approach to finding solutions. In most cases, the technologies and products we are offering are differentiated and cost competitive and as a result, not easily replaced. To date, we have not seen any dampening in the desire of customers and potential customers to engage with us as a result of the tariff developments and our opportunity pipeline remains very strong. and similar to other companies, we are exploring strategies to mitigate the potential impact of any tariffs that might emerge.

Speaker Change: Clearly demonstrating the benefits of being a global space business.

Speaker Change: In addition, we are encouraged by our customers' collaborative approach to finding solutions in most cases, the technologies and products, we are offering our differentiated and cost competitive and as a result, not easily replaced to date, we have not seen any dampening and the desire of customers and potential customers to engage with.

Speaker Change: As a result of a tariff developments and our opportunity pipeline remains very strong.

Speaker Change: And similar to other companies, we are exploring strategies to mitigate the potential impact of any tariffs that might emerge we will be monitoring this situation closely and update you as necessary.

Mike Greenley: We'll be monitoring this situation closely and update you as necessary.

Mike Greenley: Moving to a lighter topic, last year, we were also pleased to see increased recognition for MDA Space and the progress we are making from industry and peers. To name a few of the accolades we received in 2024, MDA Space was named as one of the Greater Toronto's Top Employers for 2025. The Globe and Mail's report on Business Magazine named MDA Space as one of Canada's top growing companies in its annual ranking.

Speaker Change: Moving to a lighter topic last year. We were also pleased to see increased recognition for MDA space and the progress we are making from industry and peers.

Speaker Change: A few of the accolades we received in 2024 MBA space was named as one of the greater Toronto as top employers for 2025.

Speaker Change: The global Mail's report on business magazine named MDA space as one of Canada's top growing companies in its annual ranking.

Mike Greenley: Luigi Pazabon, our Vice President of Satellite Systems at MDA Space, was named an Executive of the Year by the Globe and Mail, and I was humbled and honored to accept the 2023 Satellite Executive of the Year Award from Via Satellite Magazine and the CEO of the Year for Innovation Award from the Globe and Mail's Report on Business Magazine. In addition, our efforts to increase gender diversity earned us a spot on the Globe and Mail's report on Business Magazine's Women Lead Here First list. We were also selected as Employer of the Year by the University of Toronto's Personal Exchange Year Co-op Program, a wonderful acknowledgement of the real and meaningful work and mentorship that our teams provide for our next generation of space leaders.

Speaker Change: Luigi positive on our Vice President of satellite systems at MDA space was named an executive of the year by the global Mail.

Speaker Change: Humbled and honored to accept the 2023 satellite executive of the year Award from via satellite magazine and the CEO of the year for Innovation Award from the Globe and Mail's report on business magazine.

Speaker Change: In addition, our efforts to increase gender diversity earned us a spot on the globe and Mail's report on business magazines women lead here first list.

Speaker Change: We were also selected as employer of the year by the University of Toronto personal exchange Your co op program, a wonderful acknowledgment of the real and meaningful work and Mentorship that our teams provide for our next generation of space leaders.

Mike Greenley: And in early 2024, MDA Space was added to the TSX Competence Composite Index, an important milestone in our life as a public company.

Speaker Change: And in early 2024, NDA space was added to the PSX competence composite index, an important milestone in our life as a public company.

Mike Greenley: To recap, I'm very proud of what the team has accomplished in 2024 and optimistic about the opportunities that lie ahead. Our team is energized and highly motivated, and we remain laser-focused on our priorities, a strong focus on execution, converting opportunities in our funnel, and expanding our leadership in core markets while maintaining strong profitability and a healthy balance sheet to help us fund our growth initiatives.

Speaker Change: To recap I am very proud of what the team has accomplished in 2024 and optimistic about the opportunities that lie ahead.

Speaker Change: Our team is energized and highly motivated and we remain laser focused on our priorities our strong focus on execution.

Speaker Change: <unk> opportunities in our funnel and expanding our leadership in core markets, while maintaining strong profitability and a healthy balance sheet to help us fund our growth initiatives.

Guillaume Lavoie: With that, I'll hand it over to Guillaume to walk us through the detailed financials. Thank you, Mike. Good morning, everyone. For my update, I will walk you through our Q4 and full year 2024 financial results and our 2025 financial outlook. Overall, both Q4 and full year 2024 results were strong with solid growth in revenue and profitability. Strong free cash flow generation and solid backlog to end the year, positioning us well for 2025 and beyond. Total revenues for the fourth quarter were $347 million. This represents a $142 million or 69% increase over the same period last year.

Speaker Change: With that I'll hand, it over to Jim to walk us through the detailed financials.

Jim: Thank you Mike Good morning, everyone for my update I will walk you through our Q4 and full year 2024 financial results and our 2025 financial outlook.

Overall, both Q4 and full year 2024, our results were strong with solid growth in revenue and profitability.

Jim: Strong free cash flow generation.

Jim: And solid backlog to end the year positioning us well for 2025 and beyond.

Jim: Total revenues for the fourth quarter were 347 million. This represents a 142 million or 69% increase over the same period last year. The year over year increase is driven by higher revenues from our satellite systems business.

Guillaume Lavoie: The year-over-year increase is driven by higher revenues from our satellite systems business. On a full-year basis, total revenues were $1,080,000,000, an increase of 34% over 2023 and exceeding our full-year revenue guidance of $1,045,000,000 to $1,065,000,000. The year-over-year increase in revenues was primarily driven by execution on backlog with strong contributions from our satellite systems and robotics and space operations businesses. My business area revenues and satellite systems of three of 235 million in the fourth quarter of 2024 were 144 million or 160% increase compared to the same quarter in 2023. The strong showing was driven by the ramp of the Telesat Lightspeed Program and contributions from the Global Star Utterization to Proceed Contract, or ATP, which was awarded in Q4 2023 and recently converted into a full contract as announced on February 10, 2025.

Jim: On a full year basis total revenues were $1 $80 million, an increase of 34% over 2023 and exceeding our full year revenue guidance of $1 $45 billion $65 million.

Jim: The year over year increase in revenues was primarily driven by execution on backlog with strong contributions from our satellite systems and robotics in space operations businesses.

Jim: Sure.

Jim: By business area revenues and satellite systems of three of $235 million in the fourth quarter of 2024 were $144 million or 160% increase compared to the same quarter in 2023.

Jim: The strong showing was driven by the ramp of the Telesat Lightspeed program and contributions from the Globalstar authorization to proceed contract our ATP, which was awarded in Q4 2023, and recently converted into a full contract as announced on February 10 2025.

Guillaume Lavoie: On a full-year basis, revenues for satellite systems increased to $598 million, representing $237 million, or 65% growth, over 2023. This growth is also attributable to the ramp-up of the Telesat Lightspeed program and contributions from the new Global Star Contract. In robotics and space operations, revenues of $65 million in the latest quarter were in line with the levels seen in Q4 2023, driven by the gradual ramp of Phase C of the Canadarm3 program, which was awarded in Q2 of 2024. For full year 2024, Robotics and Space Operations revenue were $280 million, translating into a $31 million, or 13% year-over-year increase, reflecting higher volume of work performed on the Canadarm3 program.

Jim: On a full year basis revenues for satellite systems increased to $598 million, representing 37% at $237 million or 65% growth over 2023.

Jim: This growth is also attributable to the ramp up of the Telesat Lightspeed program and contributions from the new Globalstar contract.

Jim: In robotics in space operations revenues of $65 million in the latest quarter were in line with the levels seen in Q4 2023, driven by the gradual ramp of phase <unk> of the Canadarm three program, which was awarded in Q2 of 2024.

Jim: For full year 2020 for robotics in space operations revenue were 280 million translating into a $31 million or 13% year over year increase reflecting higher volume of work performed on the canadarm.

Jim: Hi.

Jim: Graham.

Guillaume Lavoie: Revenues in our geointelligence business of $47 million in the latest quarter represents a slight decrease of $2.5 million or 5% year on year, mainly due to the timing of programs renewal. For the full year 2024, revenues for geointelligence were $202 million, aligned with our expectations and representing a $4.6 million or 2% increase compared to 2023 levels.

Jim: Revenues in our intelligence business of $47 million in the latest quarter represents a slight decrease of $2 5 million or 5% year on year, mainly due to the timing of programs renewal.

For the full year 2024 revenues for <unk> intelligence were $202 million aligned with our expectations and representing a $4 6 million or 2% increase compared to 2023 levels.

Guillaume Lavoie: Moving to gross profit. For Q4 2024, gross profit was $82 million, representing a $24 million or 42% increase over the same period last year. Gross margin in the latest quarter was 23.6%, which is in line with our expectations as our program mix evolves. This compares to 28.2% for the same period in 2020. For the year, gross profit was $282 million, representing a $38 million or 15% increase over 2023. The year-over-year increase was driven by higher volume of work performed. Gross margin for the year was 26.1%, which compares to gross margin of 30.2% in 2023, again, in line with our expectations and reflective of an evolving program mix and higher depreciation expense as assets were placed into service throughout 2024.

Jim: Moving to gross profit for Q4 2024 gross profit was 82 million, representing a $24 million or 42% increase over the same period last year.

Jim: Gross margin in the latest quarter was 23, 6%, which is in line with our expectations as our program mix evolves. This compares to 28, 2% for the same period in 2023.

Jim: For the year gross profit was 282 million, representing a $38 million or 15% increase over 2023.

Jim: The year over year increase was driven by higher volume of work performed gross margin for the year was 26, 1%, which compares to gross margin of 32% in 2023 again in line with our expectations and reflective of an evolving program mix and higher depreciation.

Jim: <unk> expense as assets were placed into service throughout 2024.

Guillaume Lavoie: Adjusted EBITDA in the quarter was $71 million compared to $42 million in Q4 of 2023, reflecting again higher volume of work as we continue to execute on our backlog. Adjusted EBITDA margin was 20.5% in Q4, in line with the margin reported in Q4 2023 and consistent with our margin guidance of 19% to 20%. On a full year basis, adjusted EBITDA was $217 million, up from 2023 levels of $174 million, representing a $43 million or 25% increase year over year. The improvement was driven by higher volume of work performed and effective scaling of operating expenses. Adjusted EBITDA margin of 20.1% for the full year 2024 is consistent with our full year margin guidance of 19 to 20% and compares to 21.6% for 2020.

Adjusted EBITDA in the quarter was $71 million compared to $42 million in Q4 of 2023, reflecting again higher volume of work as we continue to execute on our backlog.

Jim: Adjusted EBITDA margin was 25% in Q4 in line with the margin reported in Q4, 2023, and consistent with our margin guidance of 19% to 20% on a full year basis, adjusted EBITDA was $217 million up from 2002 2023 levels.

Jim: Of $174 million, representing a $43 million or 25% increase year over year.

Jim: The improvement was driven by higher volume of work performed and effective scaling of operating expenses adjusted.

Jim: EBITDA margin of 21% for the full year 2024 is consistent with our full year margin guidance of 19% to 20% and compares to 21, 6% for 2020.

Guillaume Lavoie: Adjusted net income for the quarter was $35 million compared to $28 million in Q4 2023. The year-over-year increase of $7 million or 26% is largely due to higher operating income. Full year adjusted net income of $111 million was 13% higher year over year, driven by higher operating income. Adjusted diluted earnings per share of $0.28 in Q4 and $0.88 for the year were up 22% and 9% respectively versus the same periods last year. Moving to backlog, we ended the quarter with $4.4 billion in backlog representing an increase of 42% year over year. The growth and backlog was driven by the addition of a number of sizable awards, including phases C and D of the Canadarm3 program, the contract extension from the CSA to support robotics operation on the ISS, as well as numerous other awards across our business area.

Jim: Adjusted net income for the quarter was $35 million compared to $28 million in Q4 2020 through the.

Jim: The year over year increase of $7 million or 26% is largely due to higher operating income.

Jim: Full year adjusted net income of $111 million was 13% higher year over year, driven by higher operating income adjusted diluted earnings per share of 28 in Q4, and <unk> 88 for the year were up 22% and 9% respectively.

Jim: <unk> versus the same periods last year.

Jim: Moving to backlog, we ended the quarter with $4 4 billion in backlog, representing an increase of 42% year over year. The growth in backlog was driven by the addition of a number of sizable awards, including phases C and D of the Canadarm three program the contract extension from the <unk>.

Jim: To support robotics operation on the ISS as well as numerous other awards across our business areas.

Guillaume Lavoie: Now moving to CapEx, we remain focused on making the right investments in the business to support our strategic growth initiative. In Q4 2024, we spent $68 million on capital expenditures, up from $58 million last year, as we continue to progress our development on Chorus and other growth initiatives such as the expansion of our Montreal facility. On a full year basis, our capital expenditure was $201 million, compared to $193 million in 2023. We expect this level of spend to continue in 2025 as we invest in initiatives to support our growing business. including expanding and modernizing our physical infrastructure.

Jim: Now moving to Capex, we remain focused on making the right investments in the business to support our strategic growth initiatives. In Q4 2024, we spent 68 million on capital expenditures up from $58 million last year as we continue to progress our <unk>.

Government on chorus, and other growth initiatives, such as the expansion of our Montreal facility.

Jim: On a full year basis, our capital expenditure was $201 million compared to $193 million in 2023.

Jim: We expect this level of spend to continue in 2025, as we invest in initiatives to support our growing business, including expanding and modernizing our physical infrastructure.

Guillaume Lavoie: Cash flow from operations during the quarter generated $383 million compared to a cash usage of $41 million in Q4 of 2023. The year-over-year increase was driven by favorable working capital, primarily from the Telesat Lightspeed program and the new Global Star contract. Free cash flow was $315 million in the quarter versus a negative free cash flow of $99 million in the prior year. For the full year 2024, cash from operations generated $816 million compared to a cash generation of only $14 million in 2023. Operating cash flow was driven, again, by favorable working capital, primarily from the Talisat Lightspeed Program.

Jim: Cash flow from operations during the quarter generated $383 million compared to a cash usage of $41 million in Q4 of 2023 the.

Jim: The year over year increase was driven by favorable working capital primarily from the Telesat Lightspeed program and a new globalstar contract free cash flow was $315 million in the quarter versus a negative free cash flow of $99 million in the prior year.

Jim: For the full year 2020 for cash from operations generated $816 million compared to a cash generation of only $14 million in 2023.

Jim: Operating cash flow was driven again by favorable working capital primarily from the Telesat Lightspeed program.

Guillaume Lavoie: Free cash flow was $615 million in 2024, in line with our guidance for free cash flow to be positive for the full year, which we achieved one year ahead of our plan. This compares to a usage of 180 million in the prior year. The year-over-year improvement in free cash flow, again, is largely due to the previously noted positive working capital contribution. Now moving to our balance sheet, we ended the quarter with a strong financial position with net cash of $167 million, available liquidity of close to $700 million under our credit facility, and a total available liquidity of $860 million.

Jim: Free cash flow was $615 million in 2024 in line with our guidance for free cash flow to be positive for the full year, which we achieved one year ahead of our plan.

Jim: This compares to a usage of $180 million in the prior year.

Jim: The year over year improvement in free cash flow again is largely due to the previously noted positive working capital contributions.

Jim: Now moving to our balance sheet, we ended the quarter with a strong financial position with net cash of $167 million available liquidity of close to $700 million under our credit facility and a total available liquidity of $860 million.

Guillaume Lavoie: In Q4, we continue to use our cash generation to delever the balance sheet and we're debt free at the end of the year. As a reminder, at the end of 2023, our leverage ratio was at 2.4 times on a net debt to trailing 12 month adjusted EBITDA base. Our strong balance sheet positions us well to evaluate deploying capital on the right strategic opportunities to complement our strong organic growth profile.

Jim: In Q4, we continue to use our cash generation to Delever the balance sheet and were debt free at the end of the year as a reminder, at the end of 2023, our leverage ratio was at two four times on a net debt to trailing 12 month adjusted EBITDA.

Jim: Basis.

Jim: Our strong balance sheet positions us well to evaluate deploying capital on the right strategic opportunities to complement our strong organic growth profile.

Guillaume Lavoie: In summary, this was a strong quarter to wrap up fiscal 24, and we are very encouraged by the positive momentum we are seeing across our businesses.

Jim: In summary, this was a strong quarter to wrap up fiscal 'twenty four and we are very encouraged by the positive momentum we are seeing across our businesses.

Guillaume Lavoie: Now, let me turn to our 2025 outlook. As Mike noted, we are introducing our 2025 financial outlook and we are well positioned to capitalize on strong customer demand and robust market activity, given our diverse and proven technology and product offerings. For fiscal 25, we expect full-year revenues to be between $1.5 and $1.65 billion, representing a year-over-year growth of approximately 45% at the midpoint of the guidance. We expect full-year adjusted EBITDA to be between $290M and $320M, representing year-over-year growth of approximately 40% at the midpoint of the guidance and 19% to 20% adjusted EBITDA margin. We expect capital expenditures to be between $210 and $240 million in 2025, comprising of growth investments to support the previously outlined growth initiatives across our business areas.

Jim: Now, let me turn to our 2025 outlook as Mike noted, we are introducing our 2025 financial outlook and we are well positioned to capitalize on strong customer demand and robust market activity, given our diverse and proven technology and product offerings.

Jim: For fiscal 'twenty, five we expect full year revenues to be between one five and $1 65 billion, representing a year over year growth of approximately 45% at the midpoint of the guidance.

Jim: We expect full year, adjusted EBITDA to be between $290 and $320 million representing year over year growth of approximately 40% at the midpoint of the guidance and 19% to 20% adjusted EBITDA margin.

Jim: We expect capital expenditures to be between 210 and $240 million in 2025 comprising of growth investments to support the previously outlined growth initiatives across our business areas. We expect full year free cash flow to be neutral to positive.

Guillaume Lavoie: We expect full-year free cash flow to be neutral to positive in 2025. Finally, for the first quarter of 2025, we expect revenues to be between $315 and $335 million as we continue to execute on our back.

Jim: <unk> in 2025.

Jim: Finally for the first quarter of 2025, we expect revenues to be between 315 and $335 million as we continue to execute on our backlog.

Guillaume Lavoie: Please note that the financial output provided does not factor any potential impact from the recently announced tariff. As Mike noted in his remarks, our current assessment is that at this point in time our potential tariff exposure is manageable and the MDA space team continues to work with our customers to identify solutions and explore potential mitigation strategies. We will continue to monitor the situation very closely and as it unfolds.

Speaker Change: Please note that the financial outlook provided does not factor any potential impact from the recently announced tariffs as Mike noted in his remarks. Our current assessment is that at this point in time, our potential tariff exposure is manageable.

Speaker Change: And the MDA space team continues to work with our customers to identify solutions and explore potential mitigation strategies. We will continue to monitor the situation very closely and as it unfolds.

Guillaume Lavoie: We may elect to update our financial outlook if deemed necessary. with a number of large programs now in backlog. Our book of business is strong. We remain focused on discipline execution. and on our customer commitment. and leveraging our capabilities and technology to grow profitably. in core and emerging markets in line with our long-term plan.

Speaker Change: We may elect to update our financial outlook if deemed necessary.

Speaker Change: With a number of large programs now in backlog or book of business is strong we remain focused on disciplined execution.

Speaker Change: And on our customer commitments.

Speaker Change: And leveraging our capabilities and technology to grow profitably.

Speaker Change: In core and emerging markets in line with our long term plan.

Mike Greenley: Mike, with that, I'll turn it over back to you. All right. Well, that was a lot. So that was a lot of information to share. Thank you for letting us get through that.

Mike: Mike with that I'll turn it over back to you alright.

Mike: Well that was a lot.

Mike: So that was a lot of information to share. Thank you for letting us get through that.

Operator: With that, operator, we will open it up to questions. Thank you.

Mike: With that operator, we will open it up to questions.

Speaker Change: Thank you ladies and gentlemen, we will now begin the question and answer session.

Operator: Ladies and gentlemen, we will now begin the question and answer. Did you have a question? Please press star followed by the one on your touchtone. You will hear a prompt that your hand has been raised should you wish to decline from Star, followed by If you are using a speakerphone, please put the handset down. One moment, please, for your first.

Speaker Change: A question. Please press star followed by the one on your Touchtone phone you will hear prompt that your hand has been raised should you wish to decline from the polling process. Please press star followed by the Q.

Speaker Change: You're using a speakerphone please lift the handset before pressing any cheese.

Speaker Change: One moment. Please for your first question.

Konark Gupta: Your first question comes from Konark Gupta with. Your line is now open. Thanks, operator.

Gupta: Your first question comes from <unk> Gupta with Scotiabank. Your line is now open.

Gupta: Thanks, operator, good morning, everyone.

Mike Greenley: Good morning, everyone. I congrats on a great quarter. You know, Mike, like I understand, obviously, for 2025, you guys are not, you know, like factoring in tariffs, and nobody knows, obviously, you know, what would happen with that clearly. In terms of like, you know, I think you said, you have done some preliminary work, identifying mitigation strategies and the impact, etc. I mean, can you help us understand what is the sensitivity in the business based on whatever the tariffs could be potentially? I mean, like, what are the range of the outcomes you're looking at? And, you know, any examples of the mitigation strategies?

Speaker Change: Congrats on a great quarter.

Speaker Change: Yeah, Mike look I understand obviously you were trained 25, you guys or not.

Speaker Change: Factoring in tariffs and nobody knows obviously.

Speaker Change: What happened with that clearly.

Speaker Change: In terms of like you know I think you said you have done some preliminary work.

Speaker Change: Identifying mitigation strategies and the impact et cetera, I mean.

Speaker Change: Can you help us understand what is the sensitivity in the business based on whatever the dose could be potentially I mean, what are the range of the outcome. So youre looking at and any examples of the mitigation strategies you can share with us. Thanks.

Mike Greenley: Yeah, so right now, I wouldn't call it preliminary work, it's a lot of detailed work actually. So our teams are really deeply connected into governments on both sides of the border, in addition to the agencies responsible for managing imports and exports and managing any forms of tariff activity. So a very deep understanding of all of that has come to bear as we've gone through this process. Our teams are engaged with the governments that are seeking input from industry and we are actively engaged in dialogues all around that. As a result of all of that, based on, you know, as we know, tariffs come and tariffs go in terms of the oscillations of what's happening here, but at any time when people have talked about the tariffs and described them and the like, we of course have updated our assessments and repeatedly we have found the situation for us to be a manageable situation.

Speaker Change: Yes, so right now I wouldn't call. It preliminary work is a lot of detailed work actually so our teams are really deeply connected into governments on both sides of the border. In addition to the agencies are responsible for managing imports and exports and managing any forms of tariff activity. So a very deep.

Speaker Change: My understanding of all of that has come to bear as we've gone through this process.

Speaker Change: Our teams are engaged with the governments that are seeking input.

Speaker Change: From industry and we are actively engaged in dialogues all around that.

Speaker Change: As a result of all of that based on as we know tariffs commentary go.

Speaker Change: In terms of the oscillations of what's happening here, but in any at any time when people have talked about the tariffs and describe them in like.

Speaker Change: We of course have updated our assessments and repeatedly we have found the situation for us to be a manageable situation, we're not going to get into the detailed mechanics. So tariff management, just like we don't get into the details of many things and project mechanics.

Mike Greenley: We're not going to get into the detailed mechanics of tariff management, just like we don't get into the details of many things in project mechanics, but when we look at our contracts And when we look at how tariffs work, we don't see a concern for us at this time. In addition, that's further embolstered by what we expressed, whereby as we finished the year, 90% of our backlog was from outside the United States, and approximately 25% of our supply only comes from the United States. So it's a small portion of our business that we're dealing with, in addition to our understanding of the mechanics has put us in a situation whereby we feel that it's a very manageable situation.

Speaker Change: But when we look at our contracts.

Speaker Change: And when we look at how tariffs work, we don't see a concern for us at this time.

Speaker Change: In addition, that's further and bolstered by what we expressed whereby.

Speaker Change: As we finished the year, 90% of our backlog was from outside the United States and approximately 25% of our supply only comes from the United States. So it's a small portion of our business that we're dealing with in addition to our understanding of the mechanics has put us in a situation whereby we feel that it is.

Speaker Change: Very manageable situation.

Mike Greenley: We have concurrence of that position working with our customers. Our customers are also doing all the same investigations as us. And we all agree on our conclusions about how we will manage and execute tariffs as they have been described to So that's comforting for everyone that we can see our way ahead. And as we mentioned in our discussions, nothing's slowing down. All the pipeline contains very active, lots of bid and contract negotiations activity happening across the business. and there is no, there is no slowdown in our enthusiasm.

Speaker Change: We have concurrence of that position working with our customers. Our customers are also doing all the same investigations as us.

Speaker Change: And we all agree on our conclusions about how we will manage and execute tariffs as they had been described to date.

Speaker Change: So thats comforting for everyone that we can see our way ahead and as we mentioned in our discussions nothing is slowing down all the pipeline contains very active.

Speaker Change: Lots of bid.

Speaker Change: Bid and contract negotiations activity happening across the business and.

Speaker Change: And there is no there is no slowdown in our enthusiasm.

Konark Gupta: That's, that's great to hear, Mike. Thanks so much.

Speaker Change: That's great to hear Mike. Thanks, so much and if again shift gears to the competitive landscape.

Konark Gupta: And if I can shift gears to, you know, the competitive landscape, I mean, you guys just obviously won the full ATP from Global Star. So that that's great news, clearly.

Speaker Change: You guys, just obviously one full ATB from Globalstar, So that's great news clearly but.

Konark Gupta: But, you know, I think preceding that contract award, there was sort of a news Unknown Speaker I guess one other thing that I think was actually news, but SpaceX or Starlink and one of the US telecom operators, I think they were exploring some sort of activity there. Have you seen any major change in customer discussion or tone with respect to Starlink or any other satellite company out there? They are not probably, your customers are probably not in a great position. to be as aggressive in deploying new satellites to you guys you know like have you seen any changes in discussion...

Speaker Change: Proceeding that contract award.

Speaker Change: Set up a news Mitch I don't think it was actually in news but.

Speaker Change: Spacex Starlink and <unk>.

Speaker Change: One of the U S telecom operators I think they were exploring.

Speaker Change: Some sort of activity there. So I mean have you seen any major change in customer discretion of dawn with respect to installing color any other.

Speaker Change: Satellite company out there.

Speaker Change: They are not probably customers I, probably not look.

<unk> to be as aggressive in deploying new satellites to you guys like have you seen any changes in discussions.

Mike Greenley: No, we have not seen any changes in our discussions in our pipeline, and we have had new folks come into our pipeline that would like to talk to us about MDA Aurora satellites, either for broadband or more narrowband directed device type applications. And so our new business activity remains very robust. There are other people out there in the world that are also, in addition to our potential customers, busy looking at space-based networks. It's a tremendous area of growth right now globally, which would include the SpaceX example that you mentioned, in addition to others.

Speaker Change: No we have not seen any of this.

Speaker Change: Have not seen any changes in our discussions in our pipeline and we have had new folks come into our pipeline that wed like to talk to us about MDA Aurora satellites, either for broadband or more narrow band director device type applications and so our new business activity remains very robust.

Speaker Change: There are other people out there in the world that are also in addition to our potential customers.

Speaker Change: Busy looking at space based networks, it's a tremendous area of growth right now globally, which would include the Spacex example that you mentioned in addition to others. It was definitely an unfortunate situation in my view.

Mike Greenley: It was definitely an unfortunate situation, in my view, earlier when Apple did announce that it was, you know, going to talk to SpaceX and make arrangements to make sure that iPhones can work on their network. Folks seem to interpret that as a negative in our life, but it's not a negative in our by signing the contract with Globalstar. Certainly, any phone manufacturer is going to want their phones to work on all available networks, just like you do here terrestrially on Earth. You want to have them on all of the different mobile phone networks. And so you would expect, logically, that there would be a number of different relationships that would occur around the world for people to make sure that their products work on all available networks, whether they're terrestrial or space-based.

Speaker Change: The early earlier when.

Speaker Change: Apple did announced that it was going to talk to Spacex and make arrangements to make sure that iphones can work on their network folks seem to <unk>.

Speaker Change: Interpret that as a negative on our life, but it's not a negative in our life as we've subsequently demonstrated by signing the contract with Globalstar.

Speaker Change: Certainly any phone manufacturer is going to want their phones to work on all available networks. Just like you do here on trust really on Earth, you want to have them on all of their different mobile phone networks and so.

Speaker Change: You would expect logically that there would be a number of different relationships that would occur around the world for people to make sure that their products work on all available networks, whether their terrestrial aerospace space.

Mike Greenley: That doesn't change, you know, Globalstar's strong business model to be able to have an excellent network, and it doesn't change the business model of other customers of ours that want to have strong space-based networks. So we continue to move forward full steam ahead.

Speaker Change: That doesn't change Globalstar has strong business model to be able to have an excellent.

Network and it doesn't change the business model of other customers of ours that want to have strong space based networks. So we have we continue to move forward to full steam ahead.

Konark Gupta: Thanks so much for taking my question.

Speaker Change: That's great. Thanks, so much for.

Speaker Change: Taking my question.

Speaker Change: From.

Doug Taylor: Your next question comes from Doug Taylor with. Your line is now open. Hi, good morning. The guidance update here obviously reflects a quicker acceleration than most of us were modeling, which is great to see.

Your next question comes from Doug Taylor with Canaccord Genuity. Your line is now open.

Speaker Change: Okay.

Doug Taylor: Hi, good morning.

Doug Taylor: On the guidance update here, obviously reflects a quicker acceleration than most of US were modeling, which is great to see.

Doug Taylor: In helping us understand the components that build up to that, and you know, what gets you to the low end versus the high end, maybe can you help us by talking about Expected contributions or give us a frame of reference for some of the key programs, you know, Lightspeed, Globalstar, Canon Arms 3. Yes. Hi, Doug. Basically, when we look at the bridge between 2024 and 2025, the story is as followed. Essentially, we've said that, you know, Telesat is the biggest driver here in our system business. So definitely, the work is ramping up there. As we have completed the PDR, we're now really focused on the critical design review, and that's going to generate a lot more work year on year.

Doug Taylor: And helping us understand the components that build up to that and you know.

Doug Taylor: What gets you to the low end versus the high end, maybe can you help us by talking about.

Doug Taylor: We expected contributions or give us a frame of reference for some of the key programs Lightspeed Globalstar canadarm three.

Doug Taylor: Yes, Hi, Doug.

Doug Taylor: Basically.

Doug Taylor: When we look at the bridge between 2024 and 2025.

Doug Taylor: The story is as followed essentially we've said that.

Doug Taylor: Telesat.

Doug Taylor: Is the biggest driver here and our SaaS system business. So definitely definitely to work is ramping up there as we have completed the the PDR we're now.

Doug Taylor: Really focused on the critical design review and Thats going to generate a lot more work year on year.

Doug Taylor: Then you have the continued ramp on the newly awarded Global Star contract. So the work there continues to ramp up and is going to be higher year on year. We also have more revenues coming out of the C3 program. The activity is ramping up there as well. And then the only program that's going to come down year on year from a revenue perspective is the legacy Global Star contract with the 17 satellites that we're building right now. So that contract is coming to an end. So that's really the build-up to get to our guidance. It's really driven by those programs. And then the range is really around execution, right?

Doug Taylor: And then you have the continued ramp on the newly awarded Globalstar.

Doug Taylor: Contract. So the work there continues to ramp up and is going to be.

Doug Taylor: Higher year on year.

Doug Taylor: We also have more revenues coming out of the <unk> three program the activities ramping up there as well and then the only program that's going to come down year on year from a revenue perspective is the legacy globalstar contract with the 17 satellites.

Doug Taylor: We are building right now so that contract is coming to an end and then so that's really the buildup right to get to our guidance.

Doug Taylor: Really driven by those programs and then the the range is really around execution right. So we're trying to.

Doug Taylor: So we're trying to maintain a range that we feel comfortable with in terms of how we will execute the work, because obviously those are complex and complicated programs. There's a lot of activity going on, both internally and with our supply chain. But we're very confident that based on all the status that we have on each of those programs, that we can definitely be between 1.5 and 1.65 billion of revenue for 2025. I appreciate that colour.

Doug Taylor: Maintain our range that we feel comfortable with in terms of how we will execute the work because obviously those are complex and complicated programs. There is a lot of activity going on both internally and with our supply chain, but we're very confident that based on all.

Doug Taylor: The status that we have on each of those programs that we can definitely be.

Doug Taylor: <unk> between one five and 165 billion of revenue.

Doug Taylor: For 2025.

Doug Taylor: I appreciate that color and then so when we're talking about execution.

Doug Taylor: When we're talking about execution, I just wanted to speak a little bit more about the Montreal facility. It sounds like from the comments we heard earlier that that is on track, which is also great to hear as we've had a snowy winter season. Perhaps you can confirm the timetable that it hasn't changed and also update us now with your current backlog, including GlobalSTAR, as to whether the guidance you provided is contingent at all on the degree of work flowing through that facility towards the end of this year. The project continues on track, exactly as planned, actually, it's always good to see when that occurs, especially on an infrastructure development project.

Doug Taylor: I just wanted to speak a little bit more about the Montreal facility. It sounds like from the comments, we heard earlier that that.

Doug Taylor: It is on track, which is also great to hear as we've had.

Doug Taylor: Our snowy winter season, perhaps you can confirm.

Doug Taylor: <unk> table that that it hasnt change and also update us now.

Speaker Change: With your current backlog, including Globalstar as to whether the guidance you provided is contingent at all on the degree of work flowing through that facility towards the end of this year.

Speaker Change: The project continues on track.

Speaker Change: <unk> has planned actually.

Speaker Change: It's always good to see when that occurs especially on infrastructure development project. So the plan was to have the exterior of the building closed in March of 2025. It is now closed and there is a few more windows to put on but basically closed in.

Mike Greenley: So the plan was to have the exterior of the building closed in, in March of 2025, it is now closed in. There's a few more windows to put on, but it's basically closed in, which then causes you to move to the, now the activity moves into the interior of the building. And through the rest of the year, that would get completed and then fitted out with the production equipment in the end of the year. So the goal was to have that all existing and operational by the end of the year. So that as we headed into 2026, it could be used for production.

Speaker Change: Which then causes you to move to now the activity moves into the interior of the building.

Speaker Change: And through the rest of the year that will get completed and then fitted out with the production equipment in the end of the year. So the goal was to have that all existing and operational by the end of the year. So that as we headed into 2026. It could be used for production. There is no production required in that facility in 2025 related to any of our revenue.

Mike Greenley: There is no production required in that facility in 2025, related to any of our revenue or guidance at all. That facility is needed for activities that we would like to conduct in 2026. Thanks for confirming that.

Speaker Change: <unk> or guidance at all.

Speaker Change: That facility.

Speaker Change: <unk> is needed for activities that we would like to conduct in 2026.

Speaker Change: Thanks for confirming that I'll pass the line.

Doug Taylor: I'll pass one.

Speaker Change: Okay. Thank you thank.

Benoit Poirier: Your next question comes from Benoit Poirier with Desjardins. Your line is now open. Yep, thank you very much and good morning, my... Congrats for the very strong finish. in terms of working capital.

Speaker Change: Your next question comes from Ben <unk> with Baird. Your line is now.

Ben: Yes, Thank you very much and good morning, Mike and Gilman Congrats for the very strong finish.

Just in terms of our working capital limbs assumption, obviously, when we look at the 2025 guidance that implies neutral to positive what would be kind of the working capital assumption implied.

Guillaume Lavoie: Unknown Attendee, Konark Gupta, Thanos Moschopoulos, Shereen Zahawi, Guillaume Lavoie, Michael Greenley, Hi, good morning, Benoit. So on the working capital, essentially, you know, the model remains intact. We're always targeting to, you know, convert between 75 and 85% of our, you know, EBITDA into, you know, operating cash flow. And then we'll have, you know, did our planning for the year, we essentially got to a, you know, guidance of positive neutral to positive free cash flow, because we think that, you know, the combination of the variation we'll see on the working capital, and the amount we need to spend, again, this year, which is on capex of 210 to 240 million, will result in an outcome that we're comfortable with, which is neutral to positive, you know, free cash flow for the year.

Ben: In your free cash flow target and just curious in terms of booking activity what do you assume in.

Ben: Any new contract would be incremental to free cash flow for 2025.

Speaker Change: Hi, good morning, <unk>, so under our working capital.

Ben: Essentially.

Ben: The model remains intact.

Ben: Always targeting to convert between 75 and 85% of our.

Ben: EBITDA into.

Ben: Operating cash flow and then we will have working capital fluctuations.

Ben: One quarter to the other.

Ben: And when we did our planning for the year.

Ben: We essentially got to a.

Ben: Guidance of positive neutral to positive free cash flow, because we think that.

Ben: The combination of the variation, we will see on the working capital and the amount we need to spend again this year, which is on Capex of 210 to 240 million will result in an outcome that we're comfortable with which is neutral to positive.

Free cash flow for the year.

Benoit Poirier: All of our contracts are modeled in the same way, we always have, you know, always a coverage of our, you know, a cash curve that is always, you know, positive on a cumulative basis. But we'll see some variation on the working capital from time to time. But this year, we're very confident that we'll be neutral to positive free cash flow. And in terms of new business, if we picked up new awards, that would be incremental to answer your second question. Okay, that's that's great color. And when we look south of the border, the US administration considers the B program overall from fiber to satellite.

Ben: All of our contracts are modeled in the same way we always.

Ben: Have.

Ben: Always a coverage of our liability going forward and we always make sure to have a cash curve that as always.

Ben: Positive on accumulative basis.

Ben: But we will see some variation on the working capital from from time to time.

Ben: But this year, we're very confident that we'll be neutral to positive free cash flow.

Ben: And in terms of.

Ben: And then in terms of new business.

Ben: Any if we picked up new awards that would be incremental to answer your second question.

Ben: Okay, that's great color and when we look south of the border. The U S administration considers the bead program overall from fiber to satellites.

Benoit Poirier: I was wondering if you see any opportunity for MDA here as... Any programs that are doing satellite space-based communications would be opportunities for us to be emergent suppliers. Okay, okay.

Ben: I was wondering if you see any opportunity for MDA here as a merchant supplier maybe.

Ben: Any any any programs that are doing the satellite space based communications would be opportunities for us to be a merchant supplier.

Neil: Okay, Okay, and when we look in Europe, Airbus and childless space businesses are in a restructuring mode Neil.

Benoit Poirier: And when we look in Europe, Airbus Thank you guys so much for tuning in and if you liked the video you can probably hit the thumbs Yep, there would be opportunities there. In addition to the large surgence that's going on with European governments working together to put up large constellation programs such as the 11, 12 billion euro Iris squared program that engages industries all across Europe. So those programs are obviously to provide space-based network capacity for Europe, driven by European companies. But there are all sorts of creative ways where companies like ours could find various strategic partnerships and relationships to be able to get involved in those things.

Speaker Change: Any opportunities you see emerging in Europe given.

Neil: Those businesses and the restructuring mode.

Neil: Yes, there will be opportunities there in addition to the large.

Neil: Surgeons thats going on.

Neil: With European governments, working together to put up large constellation programs, such as the 11% and 12 billion Euro IRA squared program that engages industries all across Europe. So.

Neil: Those programs are obviously to provide space based network capacity for Europe, driven by Europe by European companies, but there are all sorts of creative ways, where companies like ours could.

Neil: Find various strategic partnerships and relationships to be able to get involved in those things. So they're certainly worth looking at and we do and get involved in discussions to see how could we show up just like we are always looking to see how we can show up.

Benoit Poirier: So they're certainly worth looking at, and we do, and get involved in discussions to see how could we show up. Just like we are always looking to see how we could show up more or differently in the United States to leverage more out of that market, we would also look at the European market to see how we could show up more or differently to make more out of that market. So those would be two pipeline expansion opportunities for us looking at these other markets.

Neil: More or differently in the United States to leverage more out of that market. We would also look at the European market to see how we could show up more or differently to make more out of that market. So those would be two pipeline expansion opportunities for us looking at these other markets.

Benoit Poirier: Okay, and maybe just to finish off, could you provide an update on the M&A strategy and given your stronger balance sheet right now, does it allow MDA to look at the, let's say, larger size? Certainly, the strength of our balance sheet and the level of our growth, yes, it certainly allows us to look at M&A and would allow us to look at larger deals than we would have been able to previously. I'd say that's true. In terms of us, we maintain what we've been saying for the last 18 months or so that M&A is a topic of interest to us.

Neil: And maybe just to finish up.

Speaker Change: Could you provide an update on the M&A strategy and given your stronger balance sheet right now does it allow NDA to look at the let's.

Neil: Let's say larger size deals.

Neil: Certainly our the strength of our balance sheet and the level of our growth. Yes. It certainly allows us to look at M&A and would allow us to look at larger deals than we would've been able to previously I would say that's true in terms of us we maintain what we've been saying for the last 18 months or so that.

Neil: M&A is a topic of interest to us we tend to focus on two areas. When we think about it one is in securing our supply chain to make sure that we can continue to.

Mike Greenley: We tend to focus on two areas when we think about it. One is in securing our supply chain to make sure that we can continue to take our technology roadmaps and our business roadmaps in the directions that we're currently moving. And if we have great relationships with suppliers and everything works on those roadmaps, then that's fine. If it makes more sense for us to look at M&A to be able to pick up elements, become a little bit more vertically integrated to ensure the trajectory that we're on into the future, then we will consider M&A to secure our supply chain.

Neil: Take our technology, Roadmaps, and our business Roadmaps and the directions that we're currently moving and we if we have great relationships with suppliers and everything works on those Roadmaps then thats fine if it makes more sense for us to look at M&A to be able to pick up elements become a little more vertically integrated to it.

Neil: Sure the trajectory that we're on into the future then we will consider M&A to secure our supply chain. The secondary would be for additional capability and or geographic position. So that we could have additional capability in other geographic areas.

Mike Greenley: The second area would be for additional capability and or geographic position so that we could have additional capability in other geographic areas that would open up, in addition, access to additional talent in different geographic areas and then open up new markets in different geographic areas. I think the two logical ones to think about would be the United States to open up more access to the United States government market, which is growing strong, and or Europe, which we just discussed, to open up the European government market. So you need to look at those regions, those talent pools, and the ability to show up more domestically in those areas so that you can participate in government procurement, both of which would open up larger pipelines for MDA.

Neil: That will open up in addition access to additional talent in different geographic areas and then open up new markets in different geographic areas and I think the two logical ones to think about would be the United States to open up more access to the United States government market.

Neil: Which is growing strong <unk> Europe, which we just discussed to open up the European government market.

Neil: So you need to look at those regions those talent tools and the ability to show up more domestically in those areas. So that we can participate in the government procurement both of which would open up larger pipelines for MDA.

Benoit Poirier: That's great to hear, Mike. Thank you very much and congrats again.

Neil: That's great color, Mike. Thank you very much and congrats again.

David Mcfadden: Thank you. Your next question comes from David McFadden with Cormac. Your line is now. Okay, great. Thank you.

Neil: Thank you.

David Mcfadden: Your next question comes from David Mcfadden with Carmax Securities.

Speaker Change: Your line is now open.

Speaker Change: Okay, great. Thank you a couple of questions.

David Mcfadden: A couple questions. So when you talk about tariffs, you said, you think they're mandatory. What does that mean? Does that mean that you think you can maintain your guidance? You can maintain margins? Maybe you could define that for us. That would be helpful. Yeah, for me, manageable just means, yeah, we don't have any additional news to give you on that, which would, you know, really means negative news, so no new negative news at this time, you know, in terms of us looking at the situation, looking at the composition of our business, looking at our contracts, in terms of who's responsible for what, looking at our negotiations with customers on new opportunities, when you put all that, looking at the mechanics of how tariffs work, as discussed so far, when you put all that together, then it appears to be manageable within the frameworks that we're given.

Speaker Change: So when you talk about tariffs.

Speaker Change: Okay format as well.

Speaker Change: What does that mean does that mean that you think you can maintain your guidance maintained margins, meaning maybe you could define that for us that'd be helpful.

Speaker Change: Yes for me manageable just means we don't have any additional news to give you on that.

Speaker Change: Really you need some negative news so no no negative news at this time in terms of US looking at the situation looking at the composition of our business looking at our contracts.

Speaker Change: In terms of who's responsible for what looking at our negotiations with customers on new opportunities. When you put all of that to looking at the mechanics of how tariffs work.

Speaker Change: As discussed so far when you put all that together then it appears to be manageable within the frameworks that we're giving when we said here's our guidance and it doesn't include any particular impact of tariffs it means that.

Mike Greenley: When we said, here's our guidance, and it doesn't include any particular impact of tariffs, it means that all of our investigations of this has it as a manageable activity at the moment, and we do not have any bad news to give on that topic. Obviously, this tariff situation is highly, you know, variable, and is fluctuating all the time, but as we've lived it, and engaged in it, and studied it for the last several months, it is a manageable activity for us at the moment.

Speaker Change: All of our investigations of this has it as a manageable activity at the moment and we do not have any bad news to give on that topic.

Speaker Change: Obviously this tariff situation is highly.

Speaker Change: Variable and is fluctuating all the time, but as we've lifted and engaged in it and studying it for the last several months.

Speaker Change: It is a manageable activity for us at the moment.

Mike Greenley: Okay, and So when you look at your backlog, could the U.S. government, based on what Unknown Attendee Would the U.S. government put a tariff on something that you've already agreed to that's in your backlog? Anything is possible, I guess, in terms of how you word these things. So right now, like I say, in our backlog, it's about, at the end of 24, our backlog was 90% outside the United States. So there's a small element of activity that is potentially subject, depends on how you word a tariff, but it's potentially subject to something. But again, in our analysis of the situation, we don't see any concerns.

Speaker Change: Okay.

Speaker Change: So when you look in your backlog.

Speaker Change: Thanks, so much.

Speaker Change: Well right now.

Speaker Change: Government.

Speaker Change: On the tariff on something that you've already green tea and that's in your backlog.

Speaker Change:

Speaker Change: Anything is possible I guess in terms of how you word these things so right right now.

Speaker Change: Like I say in our backlog it's about at the end of 24, our backlog was 90% outside the United States.

Speaker Change: So there's a small element of activity that is potentially subject. It depends on how you word of tariff, but its potential.

Speaker Change: Potentially subject to something but we again in our analysis of the situation. We don't see any concerns we see it as a manageable activity.

Mike Greenley: We see it as a manageable activity. Okay, I'm, I'm I mean, I'm kind of surprised that you would say 90% of your backlog is not. originates from outside the U.S. because wouldn't just the Canadarm contract alone make it something much more than temporary? Canada Arm 3, our customer is the Canadian Space Agency, so that's a Canadian contract. Canada Arm 3 is Canada, Telesat is Canada, so, you know, it's very large things. The 90% number I am quoting is the end of 24, obviously we signed the Global Star contract in Q1, which would take the 90 number down to an 80-something number.

Speaker Change: Okay.

Speaker Change: Long time.

Hi, Thank you with St nine, saying your backlog is not.

Speaker Change: Thank you James from outside the U S. Because we're doing just that.

Speaker Change: Contract alone.

Speaker Change: Something much more than 10%.

Speaker Change: Canada arm three our customer is the Canadian space agency, So that's a Canadian contract.

Speaker Change: Andrew Im curious, Canada tell us that is Canada.

Speaker Change: So.

Speaker Change: A very large things.

Speaker Change: The 90% number I am quoting is the end of 'twenty four obviously, we signed a globalstar contract in.

Speaker Change: Q1, which would take the 90 number down to an 80 something number so there's still 10% to 20% of our business in the United States and the other very large majority outside of the United States.

Mike Greenley: So there's still 10 to 20% of our business in the United States and the other very large majority outside of the United States. That's with the CSA. Okay.

Speaker Change: Okay.

Speaker Change: So that's at the CSA okay.

Mike Greenley: And then on the supply chain, you said 25% is from the U.S. Wouldn't the BUS from Rocket Lab be most of that? There's all kinds of components all over the place. So certainly the bus from Rocket Lab on that particular one contract, that would be a meaty component that's being imported from the United States. But across our business, there's a wide range of different products that come in. But as you can tell by that number, we have a very global supply chain. And so we've been doing a lot of work to ensure that we're getting good quality elements into our systems at good quality and decent prices, in addition to building relationships with folks that can scale with us globally.

Speaker Change: And then on the supply chain, you said, 25% of <unk> and boss from rocket lab.

Speaker Change: The most of it.

Speaker Change: There's all kinds of components all over the place. So certainly the bus from rocket lab on that one contract that would be a meaty immediate components, that's being important for the United States.

Speaker Change: Across our business there is a wide range of different products.

Speaker Change: But as you can tell by that number we have a very global supply chain and so where we've been doing a lot of work to ensure that we're getting good quality elements into our systems.

Speaker Change: Good quality and decent prices. In addition to building relationships with folks that can scale with us globally.

Guillaume Lavoie: It's a very new thing in the last couple of years. Historically, you would buy something for any given project based on quality and price. We still need to do that. But now because of our pace of growth, we really have to pay attention with people that can scale with us. And so that's another new conversation. So we really work globally on this and have a really nice strong supply chain right now. I may add, David, for sure 25% of our supply chain is coming from the U.S. at the moment, but just based on what we know regarding the potential retaliatory import tariffs coming from Canada, when we looked at the initial $30 billion worth of U.S.

Speaker Change: Very new thing in the last couple of years historically, you would buy something for any given project based on quality and price, we still need to do that but now because of our pace of growth, we really have to pay attention with people that can scale with us.

Speaker Change: And so that's another new conversation. So we really work globally on this and have a really nice strong supply chain right now.

David Mcfadden: I may add David.

David Mcfadden: For sure 25% of our supply chain is.

David Mcfadden: Coming from the U S at the moment, but just.

David Mcfadden: Based on what we know.

David Mcfadden: Regarding the <unk>.

David Mcfadden: Potential retaliatory import tariffs coming from Canada.

David Mcfadden: When we looked at the initial $30 billion or to the U S products like that that initial basket like theirs.

Mike Greenley: products, that initial basket, there's no impact to MDA. There's nothing on that list that would affect us. Again, things may change, but at the moment, we don't see really any impact on this.

David Mcfadden: No impact to two two MDA theres nothing on that list that would affect us.

David Mcfadden: Again things may change, but at the moment, we don't see.

David Mcfadden: Really any impact at this time.

Mike Greenley: Okay, and then there's just two marks. time. But How easy is it to replace these U.S. suppliers from, say, Europe or so on, if tariffs are going to apply to them? on the backlog.

David Mcfadden: Okay, and then just to remark that line to.

David Mcfadden: So my stomach.

Speaker Change: How easy is it to replace these U S suppliers.

David Mcfadden: In Europe.

David Mcfadden: China tariffs are going to apply to them and then secondly, just.

Mike Greenley: I think the last conference call you indicated that, uh, Backlog was going to be about $5 billion, so it's over $5 billion now, obviously, and do you expect to exit 2025 with a backlog of over $5 billion? The, on the backlog ones, because that's on the mind, like, yeah, I would expect backlog to grow through the year. Like I do think there's a chance of that, let me think, burn, it'd be, yeah, it could grow a titch in the year. It depends on, it depends on some new potential opportunities, obviously, and how the customer would like to package those should that order come through.

Speaker Change: Just on the backlog I think the last conference call you indicated that.

David Mcfadden: <unk>.

Backlog was one 5 billion so it's about.

David Mcfadden: It's over 5 billion now obviously.

David Mcfadden: And do you expecting exit 2020.

David Mcfadden: With a backlog of over $5 billion.

David Mcfadden: The.

David Mcfadden: On the backlog once were because that's what in our mind.

David Mcfadden: Yes.

David Mcfadden: I would expect backlog to grow through the year like I do think theres a chance of that.

David Mcfadden: Let me think for burn it would be yes, it could grow at pitch.

David Mcfadden: In the year it depends on.

David Mcfadden: It depends on some new potential opportunities, obviously and how the customer would like to package those should that order come through.

Mike Greenley: You know, there's, there's ways you can tilt your head and see backlog growth and then these other ways of tilting your head and, you know, maybe seeing backlog being sustained, you know, as we come out of the year.

David Mcfadden: There's ways you can tell us your head and see backlog growth and then use other ways of tilting your head, maybe seeing backlog being sustained as we come out of the year.

Mike Greenley: And then on the ability to source. are from Europe or other countries in the U.S. Like I say, it all depends on the nature of the components. There are certainly space elements that you could get from the United States that you could also get from Europe or other places, so there would be those opportunities. There's not a large drive for that at the moment, like we say, because we feel it's a manageable situation, so we are absolutely comfortable maintaining our relationships with our current supply base and are not in a mode to go and change or deviate from our current suppliers.

And then what was the first question was on the ability to.

David Mcfadden: Sorry.

David Mcfadden: Alright.

David Mcfadden: Europe or other countries.

David Mcfadden: Like I say it all depends on it all depends on the nature of the components.

David Mcfadden: There are certainly space elements that you could get from United States. So you can also get from Europe or other places.

David Mcfadden: So there will be those opportunities there's not a large drive for that at the moment like we say because we feel it's a manageable situation. So we are absolutely.

Comfortable maintaining our relationships with our current supply base.

David Mcfadden: Are not in a mode to go.

David Mcfadden: Change or deviate from our current suppliers I'm, saying out loud and on purpose. So that the suppliers listening are hearing me because they are all asking us that question right. Now we are comfortable with our mix of suppliers and we are maintaining our relationships moving forward.

Mike Greenley: I'm saying that out loud and on purpose so that the suppliers listening are hearing me because they are all asking us that question. Right now, we are comfortable with our mix of suppliers and we are maintaining our relationships moving forward. Okay. All right. Thanks.

David Mcfadden: Okay alright. Thanks.

David Mcfadden: Yes.

Ken Herbert: Your next question comes from Ken Herbert with RBC Capital. and Linus Nowak.

Ken Herbert: Your next question comes from Ken Herbert with RBC capital markets. Your line is now open.

David Mcfadden: Okay.

Mike Greenley: Yeah, good morning, Mike and Guillaume. Hey, I wanted to first start, can you confirm, Mike, when you... Still expect to be at basically the full production or two a day on the Aurora satellites. We will have the capability to produce two a day as we enter 2026. That would be the plan. We do not need to do that in 2026 based on our current orders. So in 2026, we would need to produce a few satellites for Globalstar and a few satellites for Telesat.

Yes, hi, good morning, Mike and Jim.

Speaker Change: Hey, I wanted to first start can you confirm Mike when you.

Speaker Change: Still we expect to be at basically the full production or two a day on the Aurora satellite system.

Speaker Change: We will have the capability to produce two a day as we enter 2026 that would be the plan, we do not need to do that in 2026 based on our current orders. So in 2026, we would need to produce.

Speaker Change: A few satellites for globalstar and a few satellites for telesat.

Mike Greenley: a light speed and that will allow us to you know get exercising all this new capability and work the kinks out of it and then in 2027 then you start to see some production rates where you're going to be using that full capability and really pumping out a lot of satellites so we do have a bit of grace built into these schedules and we are fortunate to have the facility ready in time that we can work the kinks out of it but we will have that capacity built and ready to go as we enter 26 and we would really be showing it off a little bit in 2027.

Speaker Change: So at light speed.

Speaker Change: And that will allow us to.

Get exercising all of this new capability and work the Kinks out of it.

Speaker Change: Then in 2027, then you start to see some production rates, where youre going to be using that for capability and really pumping out a lot of satellites. So we do have a bit of grace built into these schedules and we are fortunate to have the facility ready in time that we can work the kinks out of it.

Speaker Change: But we will have that capacity.

<unk> and ready to go as we enter 2006, and we would really be showing it off a little bit in 2027.

Mike Greenley: Okay, and with the two contracts, obviously, now that you're producing... Do you have capacity in 2020? Selling or is really as we think about incremental orders 2027 when you're really going to have capacity now that you're out. Yeah, I think it's more like that. If we got a new order now, then you're probably talking about 27 and 28 production.

Speaker Change: Okay, and with with the with the two contracts, obviously now that youre producing two do you have capacity in 2026, you could be selling or is really as we think about incremental orders 2027, when youre really going to have capacity now that youre trying to fill.

Speaker Change: Yes, I think it's more like that it's more of a if we got a new order now than Youre, probably talking about.

Speaker Change: 27% 28 production if you look as you watched us with these projects Youre seeing this sort of first year going through this preliminary design review in critical design review phases as we get all the detail designs. We have explained clearly that MDA Aurora is tend to have around 70%.

Mike Greenley: If you've watched us with these projects, you're seeing this sort of first year going through this preliminary design review and critical design review phases as we get all the detailed designs. We have explained clearly that MVA Auroras tend to have around 70% commonality across customers in terms of the core product, but then each customer has their own unique situation for their space-based networks. They did little tweaks here, little tweaks there. And so you still have to go through that process of confirming your design through the preliminary design and critical design review processes. So if somebody came in throughout 2025, for most of 25, well, for all of 25 and most of 26, you're just getting to the place where you're finishing your designs, ordering all your lead items, building up your inventory of components and things, but you're probably not building a lot until you get into 27 on a new order that would start now.

Speaker Change: <unk> across customers in terms of the core product, but then each customer has their own unique situation for their space based network. They did a little tweaks here a little tweaks there and so you still have to go through that process of.

Speaker Change: Confirm in your design.

The preliminary design and critical design review processes. So if somebody came in throughout 2025.

Speaker Change: For most of the 25 and well for all of 'twenty five in most of the 26 year Youre just getting to the place where you're finishing your designs ordering all year long lead items building up your inventory of components and things, but you are probably not building a lot until you get into 27 on a new order that would start now.

Mike Greenley: Okay, great. And just again, remind us for 27, or I'm sorry, for Lightspeed, a couple of the major either technical or sort of operational or performance milestones you've got. Yeah, the big thing in this year is really the critical design reviews on a lot of systems. And so we would expect the CDR for Lightspeed to happen later this year. So that causes us, while we are ordering some of the key components and long-lead items, we are also confirming all the exact final design configurations of that satellite as part of the overall system of which we are a part.

Speaker Change: Okay, Great and just again remind us for 2007 or I'm, sorry for Lightspeed, a couple of the major either either technical or sort of operational performance milestones you've got upcoming in the next few quarters.

Speaker Change: Yes, the big thing and this year is really the critical design reviews on a lot of systems and so.

Speaker Change: We would expect the CVR for Lightspeed to happen later this year, so that causes us while we are ordering some of the key components of long lead items. We are also confirming all the exact final design and configuration of that.

Speaker Change: Satellite as part of the overall system of which we are apart. So all those teams are working together to confirm not design same things happening on canadarm three for that system and then the same thing is happening on the new Globalstar order because we completed preliminary design review under the authorization to proceed work and now we're working towards.

Mike Greenley: So all those teams are working together to confirm that design.

Mike Greenley: Same thing is happening on Canadarm3 for that system. And then the same thing is happening on the new GlobalSTAR order, because we completed preliminary design review under the authorization to proceed work, and now we are working towards critical design review on that one as well. So all three of those this year, the big phrase of the year will be listening and watching to us in the second half of the year, crossing critical design reviews on all these programs. Great. Thanks, Mike. Really nice.

Speaker Change: <unk> design review on that one as well so all three of those this year.

The big phrase of the year will be.

Speaker Change: And watching to us in the second half of the year.

Speaker Change: Crossing critical design reviews on all of these programs.

Speaker Change: Great. Thanks, Mike a really nice quarter.

Thanos Moschopoulos: Thanks again.

Speaker Change: No problem. Thanks again, thank you.

Thanos Moschopoulos: Our next question comes from Thanos Moschopoulos with BMO Capital Markets. Hi, good morning. Mike, on the terrace, if you could clarify a very specific point. So let's say telesats find your satellite. bringing them into the U.S. to launch on SpaceX. for Ultimate Re-Export of the Space, just to be clear, is it your understanding that tariffs would apply or would not apply?

Speaker Change: Your next question comes from Thanos, Michelle Poole lift with BMO capital markets. Your line is now open.

Michelle Poole: Hi, good morning.

Speaker Change: Mike all the tariffs if you could clarify a very specific point.

Speaker Change: Let's say tell us that's buying your satellites and then bringing them into the U S launch on from Spacex.

Speaker Change: Our ultimate Reexport the space just to be clear is it your understanding the tariffs would apply here, but that aside.

Mike Greenley: Yeah, so we're not going to make comments on specific projects and project mechanics or on specific strategies for tariff management. We are giving our honest assessment of our portfolio of our business and the implications of tariffs both coming in and going out. And we feel that we have a very manageable situation, but we are not going to dive into the specifics of any individual project or the specifics of any individual's tariff mechanics.

Speaker Change: Yeah. So we're not going to make comments on specific projects and project mechanics or on specific strategies for terrorist management, we are giving our honest assessment of our portfolio of our business and the implications of tariffs both coming in and going out and we feel that we have a very manageable situation, but we are not going to dive into this.

Speaker Change: Specifics of any individual project or the specifics of any individuals tariff mechanic.

Mike Greenley: Okay, um, and then maybe a different question, just given all the geopolitical events and, you know, the US government's recent actions. Has the pipeline been benefiting from a desire from international customers? as a result.

Speaker Change: Okay.

Speaker Change: And then maybe.

Speaker Change: Different question, just given all the geopolitical events and.

Speaker Change: The U S government's recent actions.

Speaker Change: How's the pipeline did benefiting from.

Speaker Change: A desire from international customers.

Speaker Change: As a result make investments in their own space infrastructure, I mean, you mentioned Europe.

Mike Greenley: space infrastructure. I mean, you mentioned Europe, but just any other kind of things along those lines you're seeing with ramped up investments. Yeah, I think when we talk about our pipeline, we always talk about our pipeline as being pretty conservative, whereby these are specific opportunities that we are talking to customers about, that have, you know, a known scope and dollar value and therefore they're in our pipeline. Right now, I wouldn't say anything new is coming into the pipeline that's kind of a bit mature like that. However, there are a number of conversations that are occurring.

Speaker Change: Or just any other kind of things along those lines, you're seeing with the ramped up investments from international.

Speaker Change: Yes, I think when we talk about our pipeline, we always talk about our pipeline as being pretty conservative whereby these are specific opportunities that we are talking to customers about that have are known scope in dollar value and therefore, they are in our pipeline.

Speaker Change: Right now I wouldn't say anything new is coming into the pipeline, that's kind of a bit mature like that however, there are a number of conversations that are occurring.

Mike Greenley: in various countries around the world as countries are absolutely increasing their pace of activity and their enthusiasm to increase sovereignty, to increase their defense spend, to increase their own space programs and their ability to take care of themselves or work with others. There is definitely in the last quarter here a surge in enthusiasm around people that would like to do that. As a result, we are definitely getting involved in a lot more discussions about how MGA Space could show up to be able to participate in a broader range of global space programs. So those are early conversations, conceptual conversations, what if we did this, what if we did that type conversations that will most likely turn into new elements in the pipeline.

Speaker Change: In various countries around the world as countries are absolutely increasing their pace of activity and their enthusiasm to increase sovereignty to increase their defense spend to increase their own space programs and their ability to take care of themselves or work with others. There is definitely in the last.

Speaker Change: Quarter here.

Speaker Change: Serge and enthusiasm around people that would like to do that as a result, we are definitely getting involved in a lot more discussions about how MGA space could show up.

Speaker Change: To be able to participate in a broader range of global space programs.

Speaker Change: So those are early conversations conceptual conversations what if we did this what if we did that type conversations that will most likely turn into new elements in the pipeline.

Mike Greenley: But this is almost like a pre-pipeline phase right now where there's a lot of exploration going on about what countries could do because the enthusiasm is high.

Speaker Change: This is almost like a pre pipeline phase right now where there's a lot of exploration going on about what countries could do because of the enthusiasm is high.

Mike Greenley: Great.

Thanos Moschopoulos: Last one for me.

Speaker Change: Great last one for me as far as the cash flow or any any comments as far as the linearity from a quarterly perspective.

Guillaume Lavoie: As far as the cash flow, any comments as far as the linearity from a quarterly perspective, be it more back-end weighted, more front-end weighted? Yeah, good morning, Thanos. Look, you know, we're not going to provide like a quarterly guidance on free cash flows, so we'll be neutral to positive this year. Again, you know, like we'll see some working capital fluctuations from one quarter to the other. Now, with that said, we're not expecting to have like huge swings in between the different quarters.

Speaker Change: Be it more backend weighted more front end later this year.

Speaker Change: Yes, good morning, Dennis.

Speaker Change: We're not going to provide like a quarterly guidance on on free cash flow. So it will be neutral to positive. This year again like we will see some working capital fluctuations from one quarter to the other now with that said, we're not expecting to have like.

Speaker Change: Huge swings in between the different quarters I can add that color.

Guillaume Lavoie: I can add that that call.

Thanos Moschopoulos: Great, I'll pass the line.

Speaker Change: Great Best of luck. Thank you.

Operator: Thank you. Ladies and gentlemen, as a reminder, should you have a question, please press star 1.

Speaker Change: Thank you.

Speaker Change: Ladies and gentlemen, as a reminder, should you have a question. Please press star One. Your next question comes from Jason Gursky with Citibank. Your line is now open.

Mike Greenley: Your next question comes from. Your line is now. You mentioned some award activity in the geointelligence field. Business on Radar. Can you just talk a little bit about the market dynamics that are going on there, what's driving that demand and... is that a strong signal for Chorus when it comes online? I think it is a strong signal for Quorus. We've seen increases in RadarSat-2 ordering pace that is, you know, we believe certainly is driven partially by Quorus because folks are very comfortable. They can build and expand their relationship with us as a radar-based earth observation supplier to them and be able to have that continue well into the future through Quorus once it launches.

Jason Gursky: Hey, good morning, everybody.

Speaker Change: Jay you mentioned.

Speaker Change: Some award activity in the <unk> intelligence business on radar set.

Speaker Change: Can you just talk a little bit about it.

Speaker Change: Talk a little bit about what the market dynamics that are going on there what's driving that demand.

Speaker Change: Is that a.

Speaker Change: Strong signal for quarters when it comes online.

Speaker Change: I think it is a strong signal for core us we've seen increases in radar side to ordering pace.

Speaker Change: That is we believe certainly has driven partially by a chorus because folks are very comfortable they can build and expand their relationship with us as a radar based earth observation supplier to them and be able to have that continue well into the future through core us once it launches and so that.

Mike Greenley: And so that, we've noticed that over the last couple of years as we progressed with Quorus, RadarSat-2 order book remains strong. In addition, the Previous comments I made about nations wanting to do more, to look at border security, do more to look at sovereignty, do more to look at increasing their defence and intelligence posture, that is causing a bit of an uptick in what people are asking for. And so we are seeing some of that happening as well.

Speaker Change: We've noticed that over the last couple of years as we progressed with Corus radar set to order book remains strong in addition.

Speaker Change: The.

Speaker Change: Previous comments I made about nations wanting to do more to look at border security due more to look at sovereignty.

Speaker Change: Due more to look at increasing their defense and intelligence posture.

Speaker Change: That is causing a bit of an uptick in what people are asking for and so we are seeing some of that happening as well.

Speaker Change: Mhm.

Mike Greenley: Okay, great. And then, um...

Okay, Great and then.

Mike Greenley: Let's hear the space side of things, talk a little bit about an end market that we don't talk about much anymore because I suspect it's a pretty demented amount of time. Unknown Speaker 0 Unknown Speaker You just talk a little bit about the market there, the size of it these days, how many satellites are getting ordered. What your level of work activity is in supporting geosatellites being built. Yeah, sure. For those that don't know, you're talking about geosynchronous orbit satellites, the large ones in the world. Yeah, that level remains a single-digit number of orders every year around the world.

Speaker Change: Let's see here in the east side of things.

Speaker Change: And in market that we don't talk about much anymore.

Speaker Change: As expected a pretty de minimis amount of revenue, but I just wanted to confirm that.

Speaker Change: <unk> communications.

Speaker Change: Can you just talk a little bit about the market there the size of it these days and it can be satellites are getting ordered.

Speaker Change: What your level of work activity is in supporting <unk> satellites to being built.

Speaker Change: Yes, sure for those who don't know Youre talking about geosynchronous orbit satellites, the large ones in the world.

Speaker Change: Yes that level remains a single digit number of orders every year around the world. So.

Mike Greenley: So, you know, it's less than 10 annually that would get ordered in the last couple of years. It seems to be that's the sustainable level. We continue to get content. I think our number is around 80% of geo orders around the world will pick up some form of MDA space content. So our merchant supplier business remains strong. It continues to grow for us. And for both delivering satellite subsystems to geosynchronous satellite manufacturers, in addition to low-Earth orbit constellation manufacturers, it gets dwarfed a bit in all of our conversations because of the size of our LEO full satellite deliveries.

Speaker Change: Less than 10 annually that would get ordered over the last couple of years.

Speaker Change: Seems to be that's the sustainable level.

Speaker Change: We continue to get content I think our number is around 80% of Geo orders around the world will pick up some form of MDA space content. So our merchant supplier business remains strong and it continues.

Speaker Change: Continues to grow for us.

Speaker Change: <unk>.

Speaker Change: For both delivering satellite sub systems, two geosynchronous satellite manufacturers in addition to lower orbit constellation manufacturers.

Speaker Change: It gets to work to have it in all of our conversations because of the size of our full.

Mike Greenley: But our merchant supplier business continues to be strong with us working with these other satellite manufacturers. And so we tend to get some work on about 80% of the geosynchronous satellites that do occur. Unknown Speaker And do you think the geo-exposure, just how big it is, either a dollar percentage of the revenue stream, please? Oh my gosh, it'd be a very small percent. Yeah, yeah, like it'd be a very, very small percent of satellite systems, like low single digit percent, like it's not going to be a big percent.

Speaker Change: Full satellite deliveries, but our merchant supplier business continues to be strong.

Speaker Change: Working with these other satellite manufacturers and so we tend to get some work on about 80% of the geosynchronous satellites that do occur.

Speaker Change: Mhm and use it.

Speaker Change: Did you exposed to just how big it is either a dollar and percentage of the of the revenue streams of these days.

Oh, my gosh, it would be a very small percent.

Speaker Change: Yes, it would be a very very small percent of satellite systems like low single digit percent like it's not going to be a big percent.

Mike Greenley: Okay, great. And then, last question for me. You know, we've historically had quite a bit of cooperation between the United States and Canada on the defense side of things. I'm just kind of curious whether You view the priorities of the new administration here on this side of the border, on the U.S. side, in particular, Iron Dome, Golden Dome, whatever you want to call it, Missile Defense Dome. Is there any opportunity for you guys to play in? that with any of your either space-based capabilities, ground-based. I'm just kind of curious whether this represents a potential. Green Shooter growth factor for you all.

Speaker Change: Okay, Great and then last question for me.

Speaker Change: We've historically had quite a bit of cooperation between the United States and Canada.

Speaker Change: On the defense side of things.

Speaker Change: I'm just kind of curious whether.

Speaker Change: Do you view the priorities of the New administration here on this side of the border on the Westside.

Speaker Change: In particular iron dome Golden Doom, whatever you want to call. It missile defense Dome is there any opportunity for you guys to play in.

Speaker Change: That.

Speaker Change: With any of your space.

Speaker Change: These capabilities ground based I'm, just kind of curious whether this represents a potential.

Speaker Change: Green shoot a growth sector for you all as well.

Mike Greenley: Yeah, there can always be potential like the, you know, we continue to see the militaries of, you know, NATO being collaborative, and certainly, the militaries of Canada, the United States, you know, through NORAD and the like are highly integrated for North American defense. So that obviously continues, you know, a bit below the a bit below, of course, the geopolitical noise at the moment, in terms of what nations are doing to procure their systems or capabilities, there is a bit more of a trend towards procuring domestically at the moment. So if Canada was going to contribute something that, you know, they would want to maybe buy it more from a Canadian based defense, or in this example, space performer.

Speaker Change: Yes, there can always be potential like we continue to see the militaries.

Speaker Change: Sure.

Speaker Change: NATO being collaborative and certainly the military is a Canada, the United States through Norad and alike are highly integrated for North American defense. So that obviously continues.

Speaker Change: A bit below the a bit below of course, the geopolitical noise at the moment.

In terms of what nations are doing to procure their systems or capabilities. There is a bit more of a trend towards.

Speaker Change: Procuring domestically at the moment, so of Canada was going to contribute something that they would want to maybe buy more from a Canadian based.

Speaker Change: Defense Sure. This example space performer.

Mike Greenley: So that, that increases and in the US, of course, you know, has a bit of a bent towards buying from the United States based manufacturers. And that's normal, but increasing, I think around the world right now, we talked about Europe earlier in this conversation. But the collaboration is still there. So and then in that relationship, Canada's responsibility, Canada's defense strategy that's published is very northern focused, focused on the north and the Arctic, you know, so we should expect, you know, that Canada will continue to increase the pace of that both in general for the Arctic and then as part of NORAD modernization for defense of North America.

Speaker Change: So that increases and in the U S of course has a bit of a bent towards buying from the United States based manufacturers.

Speaker Change: And.

Speaker Change: That's normal, but increasing I think around the world right now we talked about Europe earlier in this conversation.

Speaker Change: But the collaboration is still there so.

Speaker Change: And then in that relationship Canada's responsibility Canada's defense strategy Thats published is very northern focus focus on the north in the Arctic.

Speaker Change: So we should expect.

Speaker Change: <unk>.

Speaker Change: That Canada will continue to increase the pace of that both in general for the Arctic and then as part of normal modernization for defense of North America. So.

Mike Greenley: So I think those collaboration intersections, you know, can come in the future. And certainly the pace of looking at what people can do to do more in defense and how to leverage the industrial base more in that expansion of defense is increasing. As I mentioned earlier, at the conversation level, and we'll see what that turns into in terms of pipeline. All right.

Speaker Change: Those collaboration intersections can come in the future and certainly the pace of looking at.

Speaker Change: What people can do to do more in defense and how to leverage the industrial base more in that expansion of defense is increasing as I mentioned earlier at the conversation level and we'll see what that turns into in terms of the pipeline.

Speaker Change: Right. Okay. Thank you I appreciate it.

Mike Greenley: Okay. Thank you. Appreciate it. Okay, thanks.

Jason Gursky: Okay. Thanks, Jason.

Mike Greenley: If there are no further questions at this time, I will now turn the call over to Mike for closing. Okay, thanks everyone. That went a bit long, but we exchanged a lot of information. Hopefully that's helpful to everyone. Certainly an exciting time as we finish a very strong 2024 and as commented during our discussion, start a bit of a steeper climb into 2025 with a 45% increase in top line, while maintaining a really good strong structure to the business. So we're very pleased with where we are. We're excited about what this year is going to bring and look forward to continuing to talk with you about it as we go through the earnings calls through the rest of the year.

Jason Gursky: There are no further questions at this time I will now turn the call over to Mike for closing remarks.

Jason Gursky: Okay. Thanks, everyone I went a bit long, but we exchanged a lot of information hopefully that's helpful to everyone certainly an exciting time as we finish a very strong.

Jason Gursky: <unk> 2024, and as commented during our discussions start a bit of a steeper climb into 2025 with a 45% increase in topline.

Jason Gursky: While maintaining a really good strong structure to the business. So we're very we're very pleased with where we are we're excited about what this year is going to bring and look forward to continuing to talk with you about it as we go through the the earnings calls through the rest of the year. Thanks very much we'll talk to you in may have a great day.

Operator: Thanks very much. We'll talk to you in May. Have a great day.

Operator: And gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect.

Speaker Change: Ladies and gentlemen, this concludes your conference call for today, we thank you for participating in assay you. Please disconnect your lines.

Speaker Change: Yeah.

Speaker Change: Yes.