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Telesat Reports Results for the First Quarter Ended March 31, 2013

Telesat Reports Results for the First Quarter Ended March 31, 2013

OTTAWA, May 2, 2013 (GLOBE NEWSWIRE) -- Telesat Holdings Inc. ("Telesat")
(TELSAT 11 11/01/15 Corp) (TELSAT 12 1/2 11/01/17 Corp) today announced its
financial results for the three month period ended March 31, 2013. All amounts
are in Canadian dollars and are reported under International Financial
Reporting Standards ("IFRS") unless otherwise noted.

For the quarter ended March 31, 2013, Telesat reported consolidated revenues
of $219 million, an increase of approximately 12% ($23 million) compared to
the same period in 2012. Revenue growth was principally the result of the
successful deployment of the Nimiq 6 satellite in the second quarter of 2012
and higher equipment sales. Operating expenses of $50 million were 40% ($33
million) lower than for the same period in 2012 related primarily to special
compensation payments to executives and certain employees in connection with
the cash distributions made to Telesat's shareholders in 2012. Adjusted
EBITDA^1 was $170 million, an increase of 12% ($18 million) over the same
period in 2012. The Adjusted EBITDA margin^1 for the first quarter of 2013 was
78%, which is unchanged from the same period in 2012.

Telesat's net loss for the quarter was $97 million compared to net income of
$98 million for the quarter ended March 31, 2012. The unfavorable variation
was due in part to a non-cash loss on foreign exchange which was the result of
the U.S. dollar strengthening relative to the Canadian dollar during the
quarter and thus impacting the translation of Telesat's U.S. dollar
denominated debt at the end of the quarter. Results were also negatively
impacted by a non-cash loss on changes in the fair value of financial
instruments, which resulted primarily from Telesat's notice to redeem its
12.5% Senior Subordinated Notes and consequent write-off of the related
prepayment option. The unfavorable variations were partially offset by lower
total operating expenses and an increase in revenues.

"I am very pleased with our strong performance in the first quarter of 2013,"
commented Dan Goldberg, Telesat's President and CEO. "Compared to the same
period in 2012, we experienced meaningful growth in revenue and Adjusted
EBITDA as a result of continued investments in our satellite fleet and
discipline on the cost side of our business. With respect to investments in
our fleet, we recently successfully launched our Anik G1 satellite, which has
considerable expansion capacity, a significant portion of which is already
contracted for the life of the satellite. We also recently re-priced certain
of our Term Loan facilities and redeemed our 12.5% Notes, steps that will
reduce our borrowing costs and support improvement in our cash flows. In light
of the strong growth we experienced in the quarter, the anticipated near term
entry into commercial service of Anik G1, and our industry-leading contractual
backlog, we are well positioned to continue to grow our business this year and
beyond."

Business Highlights

  *At March 31, 2013:

    *Telesat had contracted backlog for future services of approximately $5.0
      billion.
    *Fleet utilization was 91% for Telesat's North American fleet and 84% for
      Telesat's international fleet.

  *On April 15, 2013, Telesat successfully launched the Anik G1 satellite.
    Anik G1 will be located at the 107.3 degrees West Longitude orbital
    location and will provide a range of communications services, including
    direct-to-home (''DTH'') video for Canada, X-band for government
    applications in the Americas and Pacific Ocean Region, and C-band and
    Ku-band services in South America. Anik G1 is expected to enter into
    commercial service in May 2013.
  *On May 1, 2013, Telesat Canada and Telesat LLC redeemed all of their 12.5%
    Senior Subordinated Notes due November 1, 2017, at a price of 106.25% of
    the principal amount.
  *On April 2, 2013, Telesat Canada and Telesat LLC re-priced and amended
    their existing credit agreement, dated March 28, 2012 (the ''Credit
    Agreement''). The amendment converted $34 million from Canadian to U.S.
    dollars and decreased the interest rates on the Canadian Term Loan B
    Facility and U.S. Term Loan B Facility by 0.50%. The amendment also
    decreased the interest rate floors on the debt to 1.00% and 0.75% for the
    Canadian Term Loan B Facility and U.S. Term Loan B Facility, respectively.
    The permitted leverage ratio to incur first lien debt is now 4.25:1.00
    which represents a change from the prior 4.00:1.00 senior secured leverage
    ratio test in the Credit Agreement.

Telesat's report on Form 6-K for the quarter ended March 31, 2013 has been
filed with the U.S. Securities and Exchange Commission (SEC) and may be
accessed on the SEC's website at www.sec.gov.

Telesat has scheduled a conference call on Thursday, May 2, 2013 at 10:30 a.m.
ET to discuss its financial results for the quarter ended March 31, 2013 and
other recent developments. The call will be hosted by Daniel S. Goldberg,
President and Chief Executive Officer, and Michel Cayouette, Chief Financial
Officer, of Telesat.

  Dial-in Instructions:

  The toll-free dial-in number for the teleconference is +1 (866)
  226-1792.Callers outside of North America should dial +1 (416) 340-2216.
  Please allow at least 15 minutes prior to the scheduled start time to
  connect to the teleconference.

  Dial-in Audio Replay:

  A replay of the teleconference will be available beginning one hour after
  the end of the call on May 2, 2013 until 11:59 p.m. ET on May 16, 2013. To
  access the replay, please call +1 (800) 408-3053. Callers outside of North
  America should dial +1 (905) 694-9451. The access code is 3891046 followed
  by the number sign (#).

All Adjusted EBITDA and Adjusted EBITDA margins included in this release are
non-IFRS financial measures, as described in the End Notes section of this
release. For information reconciling non-IFRS financial measures to the most
comparable IFRS financial measures, please see the consolidated financial
information below.

Forward-Looking Statements Safe Harbor

This news release contains statements that are not based on historical fact
and are ''forward-looking statements'' within the meaning of the Private
Securities Litigation Reform Act of 1995. When used in this news release, the
words "expect", "will", "would", "well positioned to" or other variations of
these words or other similar expressions are intended to identify
forward-looking statements and information. Actual results may differ
materially from the expectations expressed or implied in the forward-looking
statements as a result of known and unknown risks and uncertainties. Detailed
information about some of the known risks and uncertainties is included in the
"Risk Factors" section of Telesat Holdings Inc.'s Annual Report on Form 20-F
for the fiscal year ended December 31, 2012, and the amendment thereto, both
of which are filed with the United States Securities and Exchange Commission
(SEC), which can be obtained on the SEC's website at http://www.sec.gov. Known
risks and uncertainties include but are not limited to: risks associated with
operating satellites and providing satellite services, including satellite
construction or launch delays, launch failures, in-orbit failures or impaired
satellite performance, volatility in exchange rates and risks associated with
domestic and foreign government regulation. The foregoing list of important
factors is not exhaustive. The information contained in this news release
reflects Telesat's beliefs, assumptions, intentions, plans and expectations as
of the date of this news release. Except as required by law, Telesat disclaims
any obligation or undertaking to update or revise the information herein.

About Telesat (www.telesat.com)

Telesat is a leading global satellite operator, providing reliable and secure
satellite-delivered communications solutions worldwide to broadcast, telecom,
corporate and government customers. Headquartered in Ottawa, Canada, with
offices and facilities around the world, the company's state-of-the-art fleet
will grow to 14 satellites once Telesat's recently-launched Anik G1 satellite
is brought into service. The fleet today consists of 13 satellites plus the
Canadian payload on ViaSat-1. Telesat also manages the operations of
additional satellites for third parties. Privately held, Telesat's principal
shareholders are Canada's Public Sector Pension Investment Board and Loral
Space & Communications Inc. (Nasdaq:LORL).


Telesat Holdings Inc.
Condensed Consolidated Statements of (Loss) Income
For the three months ended March 31
                                                       
(in thousands of Canadian dollars) (unaudited)          2013        2012^(2)
Revenue                                                 $218,848  $196,258
Operating expenses                                      (49,990)   (83,333)
                                                       168,858    112,925
Depreciation                                            (49,910)   (49,960)
Amortization                                            (8,164)    (9,102)
Other operating gains (losses), net                     471        (58)
Operating income                                        111,255    53,805
                                                                  
Interest expense                                        (61,830)   (54,713)
Loss on financing                                       (18,359)   (21,888)
Interest and other income                               385        725
(Loss) gain on changes in fair value of financial       (55,187)   60,973
instruments
(Loss) gain on foreign exchange                         (67,561)   58,772
(Loss) income before tax                                (91,297)   97,674
Tax (expense) recovery                                  (6,121)    595
Net (loss) income                                       $(97,418) $98,269



Telesat Holdings Inc.
Condensed Consolidated Balance Sheets                       
                                                          
                                              March 31,    December 31,
(in thousands of Canadian dollars) (unaudited) 2013         2012
Assets                                                     
Cash and cash equivalents                      $259,943   $180,961
Trade and other receivables                    57,351      63,762
Other current financial assets                 6,923       6,799
Prepaid expenses and other current assets      24,113      22,946
Total current assets                           348,330     274,468
Satellites, property and other equipment       2,071,310   2,090,754
Other long-term financial assets               46,501      131,535
Other long-term assets                         4,069       4,692
Intangible assets                              851,277     858,697
Goodwill                                       2,446,603   2,446,603
Total assets                                   $5,768,090 $5,806,749
                                                          
Liabilities                                                
Trade and other payables                       $51,799    $35,709
Other current financial liabilities            115,148     90,591
Other current liabilities                      78,265      77,930
Current indebtedness                           259,977     31,953
Total current liabilities                      505,189     236,183
Long-term indebtedness                         3,211,599   3,374,977
Deferred tax liabilities                       477,598     485,163
Other long-term financial liabilities          254,419     281,462
Other long-term liabilities                    390,316     402,232
Total liabilities                              4,839,121   4,780,017
                                                          
Shareholders' Equity                                       
Share capital                                  656,394     656,394
Accumulated earnings                           274,875     373,042
Reserves                                       (2,300)     (2,704)
Total shareholders' equity                     928,969     1,026,732
Total liabilities and shareholders' equity     $5,768,090 $5,806,749
                                                          


Telesat Holdings Inc.
Condensed Consolidated Statements of Cash Flows
For the three months ended March 31
                                                                
(in thousands of Canadian dollars) (unaudited)        2013        2012^(2)
Cash flows from operating activities                             
Net (loss) income                                     $(97,418) $98,269
Adjustments to reconcile net (loss) income to cash               
flows from operating activities:
Amortization and depreciation                         58,074     59,062
Deferred tax expense (recovery)                       1,181      (676)
Unrealized foreign exchange loss (gain)               71,500     (63,966)
Loss (gain) on derivatives                            55,187     (60,519)
Share based compensation                              43         299
(Gain) loss on disposal of assets                     (471)      58
Loss on financing                                     18,359     21,888
Interest expense on employee benefit plans            659        804
Other                                                 (9,238)    (14,867)
Customer prepayments on future satellite services     --         8,904
Insurance proceeds                                    --         312
Repurchase of stock options                           (701)      --
Operating assets and liabilities                      22,378     62,416
Net cash from operating activities                    $119,553  $111,984
Cash flows used in investing activities                          
Satellite programs                                    $(29,214) $(51,097)
Purchase of other property and equipment              (1,693)    (1,821)
Purchase of intangible assets                         (6)        --
Proceeds from sale of assets                          1,008      6
Net cash used in investing activities                 $(29,905) $(52,912)
Cash flows used in financing activities                          
Proceeds from indebtedness                            $--       $2,397,068
Proceeds from issue of promissory note                --         145,466
Repayment of indebtedness                             (11,132)   (1,906,415)
Repayment of senior preferred shares                  --         (141,435)
Payment of debt issue costs                           --         (36,005)
Return of capital to shareholders                     --         (586,202)
Dividends paid on preferred shares                    (10)      --
Satellite performance incentive payments              (453)      (449)
Net cash used in financing activities                 $(11,595) $(127,972)
                                                                
Effect of changes in exchange rates on cash and cash  $929      $(196)
equivalents
                                                                
Increase (decrease) in cash and cash equivalents      $78,982   $(69,096)
Cash and cash equivalents, beginning of period        180,961    277,962
Cash and cash equivalents, end of period              $259,943  $208,866
                                                                
Supplemental disclosure of cash flow information                 
Interest received                                     $239      $529
Interest paid                                         $35,313   $38,722
Income taxes paid                                     $8,746    $1,227

The following table reconciles Telesat's net income to Telesat's Adjusted
EBITDA^1 and presents Telesat's Adjusted EBITDA margin^1:

                                                  Three months ended March 31
(in thousands of Canadian dollars) (unaudited)     2013           2012^(2)
Net (loss) income                                  $(97,418)    $98,269
Tax expense (recovery)                             6,121         (595)
Loss (gain) loss on changes in fair value of       55,187        (60,973)
financial instruments
Loss (gain) on foreign exchange                    67,561        (58,772)
Interest and other income                          (385)         (725)
Loss on financing                                  18,359        21,888
Interest expense                                   61,830        54,713
Depreciation                                       49,910        49,960
Amortization                                       8,164         9,102
Other operating (gains) losses, net                (471)         58
Special compensation and benefit expense for       1,362         37,170
executives and employees
Non-recurring professional fees associated with
financing and special payments to independent      --           1,916
directors
Non-cash expense related to share based            43            299
compensation
Adjusted EBITDA                                    $170,263     $152,310
                                                                
Revenue                                            $218,848     $196,258
                                                                
Adjusted EBITDA Margin                             77.8%          77.6%

End Notes

^1 The common definition of EBITDA is "Earnings Before Interest, Taxes,
Depreciation and Amortization." In evaluating financial performance, Telesat
uses revenue and deducts certain operating expenses (including making
adjustments to operating expenses for share based compensation expense and
unusual and non-recurring items, including restructuring related expenses) to
obtain operating income before interest, taxes, depreciation and amortization
("Adjusted EBITDA") and the Adjusted EBITDA margin (defined as the ratio of
Adjusted EBITDA to revenue) as measures of Telesat's operating performance.

Adjusted EBITDA allows Telesat and investors to compare Telesat's operating
results with that of competitors exclusive of depreciation and amortization,
interest and investment income, interest expense, taxes and certain other
expenses. Financial results of competitors in the satellite services industry
have significant variations that can result from timing of capital
expenditures, the amount of intangible assets recorded, the differences in
assets' lives, the timing and amount of investments, the effects of other
income (expense), and unusual and non-recurring items. The use of Adjusted
EBITDA assists Telesat and investors to compare operating results exclusive of
these items. Competitors in the satellite services industry have significantly
different capital structures. Telesat believes the use of Adjusted EBITDA
improves comparability of performance by excluding interest expense.

Telesat believes the use of Adjusted EBITDA and the Adjusted EBITDA margin
along with IFRS financial measures enhances the understanding of Telesat's
operating results and is useful to Telesat and investors in comparing
performance with competitors, estimating enterprise value and making
investment decisions. Adjusted EBITDA as used here may not be the same as
similarly titled measures reported by competitors. Adjusted EBITDA should be
used in conjunction withIFRS financial measures and is not presented as a
substitute for cash flows from operations as a measure of Telesat's liquidity
or as a substitute for net income as an indicator of Telesat's operating
performance.

^2 A change in accounting policy has resulted in a change to the 2012
comparative figures.For more information on the impacts of the change, please
refer to note 3 of Telesat's condensed consolidated interim statements, filed
with the SEC.

CONTACT: Michael Bolitho, Telesat
         +1 (613) 748-8700 ext. 2336
         (ir@telesat.com)
 
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