Sirius XM Canada Holdings Inc., parent of Sirius XM Canada Inc., today released unaudited financial results for the quarter and year-to-date period ended May 31, 2024 prepared in accordance with International Financial Reporting Standards (IFRS)1. A summary of IFRS financial results for Q3 and YTD FY2013 is attached. All results are reported in Canadian dollars unless otherwise stated.
Q3 FY2013 Highlights
Increased quarterly dividend by 27.3% from $0.0825 to $0.1050
Self-Paying Subscribers increased 10.4% to 1,664,200 from 1,507,100 at May 31, 2024
Revenue grew 13.9% to $73.6 million from $64.6 million in Q3 FY2012
Adjusted EBITDA increased 57.8% to $15.1 million from $9.6 million in Q3 FY2012
Net income increased to $0.8 million from a loss of $4.2 million in Q3 FY2012
Free cash flow increased 81.8% to $13.3 million from $7.3 million in Q3 FY2012
Cash, cash equivalents and short term investments of $51.5 million at May 31, 2024
Year-to-date FY2013 Highlights
Revenue grew 11.3% to $213.2 million from $191.5 million for the same period in FY2012
Adjusted EBITDA increased 51.9% to $52.2 million from $34.3 million for the same period in FY2012
Net income increased to $8.1 million from a loss of $10.3 million for the same period in FY2012
Free Cash Flow increased 41.9% to $39.9 million from $28.1 million for the same period in FY2012
Launched new sales program targeted at the pre-owned vehicle market
"Continued execution against our business plan led to strong year-over-year growth in EBITDA and Free Cash Flow, and a significant 27% increase in our dividend," said Mark Redmond, President and CEO, SiriusXM Canada. "Our focus remains on driving revenue growth by adding new subscribers and through delivery of enhanced services to existing subscribers. At the same time, we look to improve our margins and build on our track record for generating positive cash flow by keeping a close eye on expenses. Through the first nine months of the year we have delivered against these expectations and look forward to Q4 which is our seasonally strong period for adding new subscribers."
"In the third quarter, we continued to deliver growth in revenue, profitability and Free Cash Flow, allowing for us to return more capital to shareholders in the form of a dividend increase. At over $51 million, our cash position is strong, providing ample liquidity and flexibility to support both our operating model and exciting growth initiatives going forward," said Michael Washinushi, CFO, SiriusXM Canada.
Financial and Operational Summary
Below, the Company has provided certain non-GAAP measures and industry metrics. These figures are subject to the qualification and assumptions set out in the notes to such results.
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1 For a complete set of financial results including the accompanying notes please refer to the Company's filings on www.sedar.com
Financial * Q3 FY2013 Q3 FY2012 YTD FY2013 YTD FY2012
(ended May 31, 2024) (ended May 31, 2024) (ended May 31, 2024) (ended May 31, 2024)
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Total Revenue $73,582 $64,615 $213,162 $191,501
Adjusted EBITDA** $15,083 $9,560 $52,152 $34,342
Net Income (Loss) $776 ($4,189) $8,113 ($10,296)
Operating*
Self-Paying Subscribers 1,664 1,507 1,664 1,507
Total Subscribers 2,322 2,117 2,322 2,117
ARPU $11.88 $11.60 $11.62 $11.58
Subscriber Acquisition Cost (SAC) $47 $49 $46 $50
Cost Per Gross Addition (CPGA) $72 $68 $72 $74
* All figures in the table above are in thousands except, SAC and CPGA
** Adjusted EBITDA is a non-GAAP measure. A reconciliation of operating income to both EBITDA and Adjusted EBITDA is provided below.
Q3 and YTD FY2013 Financial Review
For Q3 FY2013, revenue was $73.6 million, up $9.0 million, or 13.9%, from $64.6 million in Q3 FY2012. The year-over-year improvement was a result of the continued growth in the Company's revenue-generating subscriber base, as well as an increase in Average Revenue Per User (ARPU). Q3 FY2013 ARPU was $11.88, up from $11.60 in Q3 FY2012. For YTD FY2013, revenue was $213.2 million, up $21.7 million, or 11.3%, from $191.5 million for the same period in FY2012. ARPU for YTD FY2013 was $11.62 compared to $11.58 for the same period in FY2012.
SAC was $47 in Q3 FY2013, down from $49 in Q3 FY2012. The year-over-year improvement was a result of a higher proportion of gross subscriber additions being generated from winback activities that requires no incremental subsidy costs. SAC for YTD FY2013 was $46, down from $50 for the same period in FY2012.
CPGA was $72 in Q3 FY2013, down from $68 in Q3 FY2012. The year-over-year increase was a result of higher marketing costs offset by higher gross subscriber additions. CPGA for YTD FY2013 was $72, down from $74 for the same period in FY2012.
Q3 FY2013 Adjusted EBITDA was $15.1 million, representing a 57.8%, or $5.5 million increase from Adjusted EBITDA of $9.6 million in Q3 FY2012. The year-over-year improvement was a result of the combination of the Company's top-line growth offset by $2.6 million increase in total operating expenses. YTD FY2013 Adjusted EBITDA was $52.2 million, an increase of 51.9%, or $17.8 million, from $34.3 million for the same period in FY2012.
In Q3 FY2013, SiriusXM Canada generated $13.3 million in Free Cash Flow. The Company generated $13.6 million in cash from operations, used $0.3 million of cash in investing activities and used $13.5 million of cash in financing activities. Comparatively, in Q3 FY2012, SiriusXM Canada generated $7.3 million in Free Cash Flow. The Company generated $8.7 million in cash from operations, used $1.4 million of cash in investing activities and used $0.9 million of cash in financing activities. For YTD FY2013, SiriusXM Canada generated $39.9 million in Free Cash Flow. The Company generated $45.4 million in cash from operations, used $10.8 million of cash in investing activities and used $39.4 million of cash in financing activities. Comparatively, for the same period in FY2012, SiriusXM Canada generated $28.1 million in Free Cash Flow. The Company generated $30.6 million in cash from operations, used $2.5 million of cash in investing activities and used $11.7 million of cash in financing activities.
As at May 31, 2024, SiriusXM Canada had total cash, cash equivalents and short-term investments of $51.5 million, down from $51.8 million as at February 28, 2024. The decrease reflects the Company's efforts to strategically deploy its cash, paying $14.3 million in dividends as per its dividend policy.
Reconciliations
The following is a reconciliation of unaudited EBITDA and unaudited Adjusted EBITDA to Operating Income.
(In $000's) Q3 FY2013 Q3 FY2012 YTD FY2013 YTD FY2012
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Operating income (loss) 5,147 (1,199) 23,603 (169)
Depreciation & Amortization 9,374 10,006 26,511 30,990
EBITDA 14,521 8,806 50,114 30,821
Stock based compensation 526 333 1,858 1,160
Integration, severance and merger costs - 104 - 1,381
Fair value adjustments* 35 317 180 980
Adjusted EBITDA 15,083 9,560 52,152 34,342
* Fair value adjustment relates to the reduction in revenue due to the valuation of deferred revenue as per purchase price accounting
Please see the Company's Management Discussion & Analysis filed July 10, 2024 for more details on the Company's Q3 and YTD FY2013 results. The non-GAAP measures used in this press release should be used in addition to, but not as a substitute for, the analysis provided in the unaudited consolidated statement of operations and comprehensive income. Please see the Company's Management Discussion & Analysis filed July 10, 2024 for complete definition of non-GAAP measures.
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CONSOLIDATED INTERIM BALANCE SHEETS
(Unaudited)
(Canadian dollars)
At May 31, 2024 August 31, 2024
ASSETS
Current assets
Cash and cash equivalents 46,305,765 51,034,749
Short-term investments 5,195,460 —
Accounts receivable 14,457,382 12,133,138
Prepaid expenses 4,404,623 3,361,448
Inventory 200,899 324,316
Total current assets 70,564,129 66,853,651
Long-term prepaid expenses 100,590 79,410
Property and equipment 6,007,510 7,617,399
Intangible assets 159,823,113 175,986,331
Deferred tax assets 56,233,841 59,858,394
Goodwill 96,732,525 96,732,525
Total assets 389,461,708 407,127,710
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Trade and other payables 43,032,074 39,085,800
Due to related parties 8,367,722 6,775,601
Interest payable 6,274,526 2,704,449
Current portion of deferred revenue 142,951,048 137,554,399
Provisions 1,532,359 1,285,587
Total current liabilities 202,157,729 187,405,836
Deferred revenue 18,116,287 21,019,320
Other long-term liabilities 3,759,798 6,902,537
Due to related parties 3,587,527 1,208,332
Long-term debt 145,702,949 144,992,819
Provisions 314,345 344,112
Total liabilities 373,638,635 361,872,956
Shareholders' equity
Share capital 150,440,062 148,393,493
Contributed surplus 6,165,175 5,057,501
Accumulated deficit (140,782,164) (108,196,240)
Total shareholders' equity 15,823,073 45,254,754
Total liabilities and shareholders' equity 389,461,708 407,127,710
CONSOLIDATED INTERIM STATEMENTS OF OPERATIONS AND
COMPREHENSIVE INCOME (LOSS)
(Unaudited)
(Canadian dollars) Three Months ended Nine Months ended
May 31, 2024 May 31, 2024 May 31, 2024 May 31, 2024
Revenue 73,581,631 64,615,173 213,162,178 191,500,550
Operating expenses
Operating costs 59,060,543 55,705,162 163,047,823 159,298,266
Severance and merger costs — 104,428 — 1,381,390
Depreciation and amortization 9,374,461 10,005,268 26,511,057 30,989,731
Operating income 5,146,627 (1,199,685) 23,603,298 (168,837)
Finance costs, net
Interest income 170,248 103,118 511,302 228,147
Interest expense (3,997,601) (4,010,560) (11,897,897) (12,715,708)
Foreign exchange (loss) (65,986) (389,460) (530,496) (546,035)
Gain (loss) on revaluation of derivatives — 14,403 51,378 (3,390)
Finance costs (3,893,339) (4,282,499) (11,865,713) (13,036,986)
Income (loss) before income tax 1,253,288 (5,482,184) 11,737,585 (13,205,823)
Income tax (expense) recovery (477,169) 1,293,210 (3,624,553) 2,910,222
Net income (loss) and comprehensive income (loss) 776,119 (4,188,974) 8,113,032 (10,295,601)
Basic and fully diluted (loss) earnings per share 0.01 (0.03) 0.07 (0.08)
CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(Unaudited)
(Canadian dollars)
Total
Share Contributed Accumulated Shareholders'
For the nine months ended Capital Surplus deficit Equity
Balance, September 1, 2024 147,169,430 4,324,032 (104,017,424) 47,476,038
Total comprehensive (loss) for the period — — (10,295,601) (10,295,601)
Stock-based compensation — 1,160,263 — 1,160,263
Stock options exercised 1,144,741 (710,439) — 434,302
Balance, May 31, 2024 148,314,171 4,773,856 (114,313,025) 38,775,002
Balance, September 1, 2024 148,393,493 5,057,501 (108,196,240) 45,254,754
Total comprehensive income for the period — — 8,113,032 8,113,032
Stock-based compensation — 1,858,258 — 1,858,258
Dividends — — (40,698,956) (40,698,956)
Stock options exercised 2,046,569 (750,584) — 1,295,985
Balance, May 31, 2024 150,440,062 6,165,175 (140,782,164) 15,823,073
CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS
(Unaudited)
(Canadian dollars) Three months ended Nine months ended
May 31, 2024 May 31, 2024 May 31, 2024 May 31, 2024
Cash provided by (used in)
OPERATING ACTIVITIES
Net income (loss) for the period 776,119 (4,188,974) 8,113,032 (10,295,601)
Add(deduct) items not involving cash
Amortization of intangible assets 8,871, 200 9,338,902 24,854,334 28,866,551
Depreciation of property and equipment 503,261 666,366 1,656,723 2,123,180
Deferred tax expense (recovery) 477,169 (1,293,210) 3,624,553 (2,910,222)
Stock-based compensation 526,178 333,136 1,858,258 1,160,263
Accrued interest 3,587,543 3,583,180 3,570,077 3,564,985
Interest accretion 241,076 229,193 710,130 718,533
Revaluation of derivative — (14,403) (51,378) 3,390
Unrealized foreign exchange losses 85,134 448,082 598,586 293,658
Net change in non-cash working capital and
deferred revenue related to operations (1,476,316) (438,238) 491,672 7,123,295
Cash provided by operating activities 13,591,364 8,664,034 45,425,987 30,648,032
INVESTING ACTIVITIES
Purchase of property and equipment (26,853) (30,840) (58,255) (625,892)
Purchase of intangible assets (309,794) (1,341,147) (5,439,024) (1,891,830)
Purchase of bonds — — (5,306,295) —
Interest on bonds — — 51,574 —
Cash used by investing activities (336,647) (1,371,987) (10,752,000) (2,517,722)
FINANCING ACTIVITIES
Payment of dividends (14,264,286) — (40,698,956) —
Payment of related party promissory notes — — — (11,173,290)
Proceeds from exercise of stock options 715,339 40,394 1,295,985 434,302
Repayments of debt — (917,700) — (917,700)
Cash used by financing activities (13,548,947) (877,306) (39,402,971) (11,656,688)
Net increase in cash and cash equivalents
during the period (294,230) 6,414,741 (4,728,984) 16,473,622
Cash and cash equivalents, beginning of period 46,599,995 36,074,320 51,034,749 26,015,439
Cash and cash equivalents, end of period 46,305,765 42,489,061 46,305,765 42,489,061