24 WINGS | March/April 2015 WWW.WINGSMAGAZINE.COMPHOTO: MDAcommercial applications, while its robotics and automation unit
provides the robotics for the International Space Station, including
the Canadarm and Dextre. Dextre is an extension of the Canadarm2.
The dexterous dual-armed solution will be able to touch, sense, and
respond much like a human. It is used for many of the servicing and
assembly tasks performed by astronauts on space walks.
MDA’s geospatial services are one of the largest satellite radar data
providers in the world and the operator and worldwide commercial
data distributor for the RADARSAT-1 and RADARSAT-2 satellites.
MDA is also developing next-gen space automation capabilities for
planetary exploration and on-orbit satellite servicing and repair.
As part of its airborne surveillance solutions, the company pro-
vides unmanned aerial vehicle (UAV) surveillance that supports a
wide-range of defence and commercial applications and aviation so-
lutions to improve the safety and productivity for civil and defence
air operators, among other applications. MDA offers turnkey UAV
services, airborne radars, and related systems that turn data from
surveillance sensors into meaningful insights for its customers, in-
cluding system design and development through logistics support,
training, maintenance and other operational services.
Its airborne radar solutions provide high resolution imaging,
advanced moving target identification and other advanced detection
and identification modes.
UAVs have a ceiling of 20,000 feet and a flying time of 24 hours,
and because they’re a real airplane, they must be flown like one from
the ground. And they shouldn’t be referred to as drones, which have a
connotation of not being smart or not being able to think, according
to MDA, whereas highly trained pilots operate UAVs or intelligence
officers that can make decisions on how to fly the aircraft. MDA’s
airborne radar solutions provide high resolution imaging, advanced
moving target identification, and other advanced detection and
identification modes.
In October alone, MDA signed a $40-million contract amendment
to provide UAV surveillance for the Royal Australian Air Force
through to December 2017 with options for up to an additional three
years. MDA’s service supports the RAAF plans to further develop
Australia’s unmanned surveillance and reconnaissance capabilities.
It signed another contract valued at US$6.4 million under its
Indefinite Delivery/Indefinite Quantity (IDIQ) agreement with the
U.S. Air Force to further enhance the flight path safety system that
aids the design of airport approach and departure flight paths. The
value of contracts awarded to date under the IDIQ agreement total
approximately US$20.2 million.
The U.S. Air Force uses an MDA-developed ground-based flight
path design system, which supports the design of aircraft flight
paths between the airport terminal area and en route phases of
flight. MDA is extending this system, incorporating the Federal
Aviation Administration terminal instrument procedures’ rules
associated with satellite based navigation.
MDA was also awarded a contract worth $10 million to provide
multiple communication subsystems to Airbus Defence and Space.
Not bad for a month’s work, which only includes aerospace relatedagreements. Other contracts were signed with undisclosed values.
In addition to signing these deals, MDA completed the acquisition
of Advanced Systems from General Dynamics, which specializes in
the development and application of radar and other information
sensors for the U.S. government with annual sales of about US$40
million. The deal is also expected to boost MDA’s ability to pursue
other opportunities in the U.S. market.
After visiting MDA management in November following the
release of its third quarter results, National Bank financial analyst
Kris Thompson was told the company is taking “aggressive steps” to
improve the efficiency of Space Systems/Loral (SSL), two years after
it was acquired by MDA for $875 million. SSL, with $1.1 billion in
revenues in 2011, is a leading provider of geostationary commercial
satellites, with experience building and integrating some of the
world’s most powerful and complex satellites and spacecraft
systems. The company has a long history of delivering satellites
and spacecraft systems for commercial and government customers
around the world and currently has more geostationary commercial
capacity on orbit than any other manufacturer.
In September, MDA was selected by the U.S. Air Force Space and
Missile Systems Center to work with U.S. government agencies to
host government payloads on commercial satellites. With a value
up to $494.5 million, the Hosted Payload Solutions contracts pre-
qualify SSL to bid on opportunities for hosted payloads, which
can help the U.S. government get a variety of missions to orbit by
integrating them with commercial satellites. The hosted payload
concept speeds access to space and reduces space segment cost
for both government and commercial missions. MDA also plans
to shift the surveillance and intelligence business towards more
services, with more focus on intelligence within the government
(versus lower-margin civilian applications) and pursue commercial
opportunities. At the end of October, an undisclosed customer
selected MDA for its eighth satellite award in 2014.
“We estimate that MDA is winning 30 per cent of commercial
satellite contracts for the year. SSL’s active satellite builds this year
are the highest in the company’s history,” said Thompson.
Flow its third quarter results, MDA report sales of $507 million
($463.2 million a year ago), of which $373 million came from the
communications side of the business, up 11 per cent from a year
earlier and $134 million from surveillance and intelligence, a six per
cent hike from the year earlier period. For the first nine months,
revenue increased to $1.55 billion from $1.34 billion.
For the year, Thompson estimates total revenue will be $2.069
billion, versus $1.818 in 2013 and will reach $2.227 billion in 2015.
Communications will account for 72 per cent of the total and
surveillance and intelligence will make up 28 per cent.
In fiscal 2012, communications accounted for 44 per cent of MDA’s
revenue, then shot up to 73 per cent in 2013, while surveillance and
intelligence declined to 27 per cent from 56 per cent. That’s because
in 2012, communications revenues only included SSL’s results for
two months as the acquisition was only completed in November- In 2013, it included 12 months of SSL revenues.
In terms of geographical revenue, Canada represented 33 per
cent of the total in 2011, but dropped to 13 per cent in 2013. During
the same period, Europe also declined from 31 per cent to 14 per
cent, but Australia went from eight per cent to 18 per cent. Asia and
South America have predictably increased their respective shares.
This shift is again attributed to the inclusion of SSL revenues in
2013, but not in 2011. However, geographical segmentation could
change “significantly” from one year to the next, so a single year does
not indicate a trend, according to the company.
As for growth opportunities in surveillance and intelligence, MDA
is focusing on the U.S. market and international markets where it
claims to have made “significant progress. The main challenge is
(tighter military) budgets.”
With such diverse product offerings in its two divisions, MDA
looks to be capable of growing both on the ground and in the air. | W
MDA plans to shift its surveillance and intelligence business towards more
services, with more focus on intelligence within the government.