Skip to main content
Equibles

6-K

Telesat Corp (TSAT)

6-K 2025-05-06 For: 2025-05-06
View Original
Added on July 04, 2026

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549

_______________

FORM 6-K

_______________

Report of Foreign Private Issuer Pursuant to Rule 13a-16 or 15d-16 Under the Securities Exchange Act of 1934

For the Month of May 2025

Commission File No.: 001-41083

_______________

TELESAT CORPORATION (Name of Registrant)

_______________

160 Elgin Street, Suite 2100, Ottawa, Ontario, Canada K2P 2P7 (Address of Principal Executive Office)

_______________

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F ☒            Form 40-F ☐

EXHIBITS

The following information is furnished to the Securities and Exchange Commission as part of this report on Form 6-K:

Exhibit No. Document
99.1 Telesat Corporation Quarterly Report for the Three Month Period Ended March 31, 2025
99.2 Form 52-109F2 Certification of Interim Filings Full Certificate — CEO
99.3 Form 52-109F2 Certification of Interim Filings Full Certificate — CFO

1

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

TELESAT CORPORATION
Date: May 6, 2025 By: /s/ CHRISTOPHER S. DIFRANCESCO
Name: Christopher S. DiFrancesco
Title: Vice President, General Counsel and Secretary

2

Exhibit 99.1

TELESAT CORPORATION

Quarterly Report

For the Three Month Period Ended March 31, 2025

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements 1
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 28
Item 3. Quantitative and Qualitative Disclosures About Market Risk 57

PART II. OTHER INFORMATION

Item 1. Legal Proceedings 58
Item 1A. Risk Factors 58
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 58
Item 3. Defaults Upon Senior Securities 58
Item 4. Reserved 58
Item 5. Other Information 58
Item 6. Exhibits 58

i

PART I. FINANCIAL INFORMATION

Item 1.       Financial Statements

Telesat Corporation Unaudited Interim Condensed Consolidated Statements of Income (Loss) For the three months ended March 31

(in thousands of Canadian dollars, except per share amounts) Notes 2025 2024
Revenue 4 $ 116,749 $ 152,175
Operating expenses 5 (53,042 ) (47,112 )
Depreciation (25,909 ) (36,395 )
Amortization (10,899 ) (2,823 )
Other operating gains (losses), net 7 3,950 15
Operating income 30,849 65,860
Interest expense 6 (56,664 ) (64,430 )
Interest and other income 6,208 21,128
Gain (loss) on changes in fair value of financial instruments 19 (33,412 ) —
Gain (loss) on foreign exchange 2,480 (68,413 )
Income (loss) before income taxes (50,539 ) (45,855 )
Tax (expense) recovery 8 (918 ) (6,482 )
Net income (loss) $ (51,457 ) $ (52,337 )
Net income (loss) attributable to:
Telesat Corporation shareholders $ (15,538 ) $ (14,762 )
Non-controlling interest (35,919 ) (37,575 )
$ (51,457 ) $ (52,337 )
Net income (loss) per common share attributable to Telesat Corporation shareholders
Basic $ (1.08 ) $ (1.08 )
Diluted $ (1.08 ) $ (1.08 )
Total Weighted Average Common Shares Outstanding
Basic 16 14,381,205 13,706,546
Diluted 16 14,381,205 13,706,546

See accompanying notes to the unaudited interim condensed consolidated financial statements

1

Telesat Corporation Unaudited Interim Condensed Consolidated Statements of Comprehensive Income (Loss) For the three months ended March 31

(in thousands of Canadian dollars) 2025 2024
Net income (loss) $ (51,457 ) $ (52,337 )
Other comprehensive income (loss)
Items that may be reclassified into profit or loss
Foreign currency translation adjustments 1,752 95,755
Total other comprehensive income (loss) 1,752 95,755
Total comprehensive income (loss) $ (49,705 ) $ 43,418
Total comprehensive income (loss) attributable to:
Telesat Corporation shareholders $ (15,238 ) $ 11,254
Non-controlling interest (34,467 ) 32,164
$ (49,705 ) $ 43,418

See accompanying notes to the unaudited interim condensed consolidated financial statements

2

Telesat Corporation Unaudited Interim Condensed Consolidated Statements of Changes in Shareholders’ Equity

(in thousands of Canadian dollars) Telesat <br>Corporation <br>Shares Accumulated <br>earnings Equity-<br>settled <br>employee <br>benefits <br>reserve Foreign <br>currency <br>translation <br>reserve Total <br>reserves Total Telesat <br>Corporation <br>shareholders’ <br>equity Non-<br>controlling <br>Interest Total <br>shareholders’ <br>equity
Balance as at January 1, 2024 $ 51,252 $ 534,058 $ 67,807 $ 8,801 $ 76,608 $ 661,918 $ 1,737,065 $ 2,398,983
Net income (loss) — (14,762 ) — — — (14,762 ) (37,575 ) (52,337 )
Issuance of share capital on settlement of restricted share units and deferred share units 1,986 3,943 (502 ) 191 (311 ) 5,618 (7,776 ) (2,158 )
Other comprehensive income (loss), net of tax (expense) recovery of Nil — — — 26,016 26,016 26,016 69,739 95,755
Share-based compensation — — 1,487 — 1,487 1,487 3,949 5,436
Balance as at March 31, 2024 $ 53,238 $ 523,239 $ 68,792 $ 35,008 $ 103,800 $ 680,277 $ 1,765,402 $ 2,445,679
Balance as at April 1, 2024 $ 53,238 $ 523,239 $ 68,792 $ 35,008 $ 103,800 $ 680,277 $ 1,765,402 $ 2,445,679
Net income (loss) — (72,958 ) — — — (72,958 ) (177,171 ) (250,129 )
Issuance of share capital on settlement of restricted share units, deferred share units, performance share units and the exercise of stock options 5,844 12,098 (1,085 ) 1,476 391 18,333 (22,877 ) (4,544 )
Other comprehensive income (loss), net of tax (expense) recovery of (4,844) — 4,954 — 76,426 76,426 81,380 212,669 294,049
Share-based compensation — — 3,248 — 3,248 3,248 8,402 11,650
Balance as at December 31, 2024 $ 59,082 $ 467,333 $ 70,955 $ 112,910 $ 183,865 $ 710,280 $ 1,786,425 $ 2,496,705
Balance as at January 1, 2025 $ 59,082 $ 467,333 $ 70,955 $ 112,910 $ 183,865 $ 710,280 $ 1,786,425 $ 2,496,705
Net income (loss) — (15,538 ) — — — (15,538 ) (35,919 ) (51,457 )
Issuance of share capital on settlement of restricted share units and performance share units 6,855 4,897 (994 ) 1,843 849 12,601 (19,374 ) (6,773 )
Exchange of Limited Partnership units for Public Shares 34 — — — — 34 (34 ) —
Other comprehensive income (loss), net of tax (expense) recovery of Nil — — — 300 300 300 1,452 1,752
Share-based compensation — — 939 — 939 939 2,306 3,245
Balance as at March 31, 2025 $ 65,971 $ 456,692 $ 70,900 $ 115,053 $ 185,953 $ 708,616 $ 1,734,856 $ 2,443,472

All values are in US Dollars.

See accompanying notes to the unaudited interim condensed consolidated financial statements

3

Telesat Corporation Unaudited Interim Condensed Consolidated Balance Sheets

(in thousands of Canadian dollars) Notes March 31, <br>2025 December 31, <br>2024
Assets
Cash and cash equivalents $ 797,371 $ 552,064
Trade and other receivables 62,304 158,930
Other current financial assets 685 565
Current income tax recoverable 28,810 29,253
Prepaid expenses and other current assets 265,768 280,460
Total current assets 1,154,938 1,021,272
Satellites, property and other equipment 4,9 2,428,957 2,277,143
Deferred tax assets 2,791 3,059
Other long-term financial assets 12,953 9,767
Long-term income tax recoverable 6,993 6,993
Other long-term assets 4 417,827 516,507
Intangible assets 4,10 487,298 497,466
Goodwill 10 2,613,409 2,612,972
Total assets $ 7,125,166 $ 6,945,179
LIABILITIES
Trade and other payables $ 92,664 $ 158,276
Other current financial liabilities 43,419 26,483
Income taxes payable 6,713 5,913
Other current liabilities 62,183 65,906
Total current liabilities 204,979 256,578
Long-term indebtedness 12 3,353,208 3,096,615
Deferred tax liabilities 173,165 175,544
Other long-term financial liabilities 663,173 630,556
Other long-term liabilities 287,169 289,181
Total liabilities 4,681,694 4,448,474
SHAREHOLDERS’ EQUITY
Share capital 13 65,971 59,082
Accumulated earnings 456,692 467,333
Reserves 185,953 183,865
Total Telesat Corporation shareholders’ equity 708,616 710,280
Non-controlling interest 14 1,734,856 1,786,425
Total shareholders’ equity 2,443,472 2,496,705
Total liabilities and shareholders’ equity $ 7,125,166 $ 6,945,179

See accompanying notes to the unaudited interim condensed consolidated financial statements

4

Telesat Corporation Unaudited Interim Condensed Consolidated Statements of Cash Flows For the three months ended March 31

(in thousands of Canadian dollars) Notes 2025 2024
Cash flows from operating activities
Net income (loss) $ (51,457 ) $ (52,337 )
Adjustments to reconcile net income (loss) to cash flows from operating activities:
Depreciation 25,909 36,395
Amortization 10,899 2,823
Tax expense (recovery) 918 6,482
Interest expense 56,664 64,430
Interest income (6,342 ) (21,296 )
(Gain) loss on foreign exchange (2,480 ) 68,413
(Gain) loss on changes in fair value of financial instruments 33,412 —
Share-based compensation 3,241 5,434
(Gain) loss on disposal of assets (3,950 ) (15 )
Deferred revenue amortization (14,407 ) (13,659 )
Pension expense 1,366 1,409
Other (691 ) 197
Income taxes paid, net of income tax received 21 (1,580 ) (11,496 )
Interest paid, net of interest received 21 (31,350 ) (18,147 )
Government grant received — 1,085
Operating assets and liabilities 21 118,772 6,953
Net cash from operating activities 138,924 76,671
Cash flows (used in) generated from investing activities
Cash payments related to satellite programs (200,313 ) (757 )
Cash payments related to property and other equipment (34,744 ) (19,278 )
Net proceeds from disposal of assets 4,500 —
Government grant received — 109
Net cash (used in) generated from investing activities (230,557 ) (19,926 )
Cash flows (used in) generated from financing activities
Proceeds from indebtedness 12 340,000 —
Payments of principal on lease liabilities 21 (515 ) (647 )
Satellite performance incentive payments 21 (190 ) (711 )
Tax withholdings on settlement of restricted and performance share units (6,788 ) (2,116 )
Net cash (used in) generated from financing activities 332,507 (3,474 )
Effect of changes in exchange rates on cash and cash equivalents 4,433 33,939
Changes in cash and cash equivalents 245,307 87,210
Cash and cash equivalents, beginning of period 552,064 1,669,089
Cash and cash equivalents, end of period $ 797,371 $ 1,756,299

See accompanying notes to the unaudited interim condensed consolidated financial statements

5

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. BACKGROUND OF THE COMPANY

Telesat Corporation was incorporated under the Business Corporations Act (British Columbia) in October 2020 and is headquartered in Ottawa, Canada.

References herein to “Telesat” or “Company” refer to Telesat Corporation and its subsidiaries.

The Company is a global satellite operator, providing mission-critical communications solutions to support the requirements of sophisticated satellite users throughout the world. The Company’s state-of-the-art fleet consists of 14 geostationary satellites and the Canadian payload on Viasat-1.

Telesat LEO Inc., a wholly-owned subsidiary of the Company, is building a constellation of low earth orbit (“LEO”) satellites and integrated terrestrial infrastructure, called “Telesat Lightspeed”. In January 2018, the first LEO satellite, LEO 1, was successfully launched into orbit. The LEO 1 satellite demonstrated certain key features of the Telesat Lightspeed system design, specifically the capability of the satellite and customer terminals to deliver a low latency broadband experience. In July 2023, the Company successfully launched its LEO 3 satellite into orbit, and it has since replaced LEO 1.

The Company began trading on the Nasdaq Global Select Market and the Toronto Stock Exchange on November 19, 2021 under the ticker symbol “TSAT”. Quarterly and annual financial statements, material change statements and other publicly available documents of the Company can be obtained from the U.S. Securities Exchange Commission (“SEC”) at https://www.sec.gov and the System for Electronic Document Analysis and Retrieval (“SEDAR+”) at https://www.sedarplus.ca.

Unless the context states or requires otherwise, references herein to the “financial statements” or similar terms refer to the unaudited interim condensed consolidated financial statements of Telesat.

On May 5, 2025, these financial statements were approved by the Audit Committee of the Board of Directors and authorized for issue.

  1. BASIS OF PRESENTATION

Statement of Compliance

The financial statements represent the interim financial statements of the Company and its subsidiaries, on a consolidated basis, prepared in accordance with International Accounting Standard 34, Interim Financial Reporting (“IAS 34”).

The financial statements should be read in conjunction with the December 31, 2024 consolidated financial statements of the Company. The financial statements use the same basis of presentation and accounting policies and critical accounting judgments and estimates as outlined in Notes 3 and 4 of the consolidated financial statements for the year ended December 31, 2024, with the exception of the changes outlined in Note 3, below.

The results of operations for the three months ended March 31, 2025 are not necessarily indicative of the results that may be expected for the full fiscal year.

  1. MATERIAL ACCOUNTING POLICY INFORMATION

Orbital Slot Intangible Assets

Prior to January 1, 2025, the Company’s accounting estimates concerning the appropriate useful economic lives of geostationary (“GEO”) orbital slots have been that they have indefinite lives as it was expected, with a relatively high level of certainty, that it would maintain continued occupancy of an assigned GEO orbital slot either during the operational life of an existing orbiting satellite or upon replacement by a new satellite once the operational life of the existing orbiting satellite is over.

6

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. MATERIAL ACCOUNTING POLICY INFORMATION (cont.)

To respond to market dynamics, the Company is focused on developing its constellation of LEO satellites. A large part of its current and future capital expenditures are expected to be related to this constellation. In light of market developments, the number of occupied operational GEO orbital slots is likely to decline over time and management no longer believes that the existing GEO orbital slots will continue to be utilized for an indefinite period of time.

As a result, management has updated its estimates in this area such that all GEO orbital slots are now presented as finite life assets. For those orbital slots which were formerly presented as indefinite life assets, their residual carrying values will generally be amortized over the remaining life of the on-station satellite operating at that orbital position in accordance with the provisions of International Accounting Standard 38, Intangible Assets (“IAS 38”). Where more than one satellite is co-located at one position then the latest end of life amongst those satellites is used. Where the likelihood of procuring a new or replacement satellite is probable, management calculates the end of life of that uncommitted replacement and applies it in computing the amortization life of the relevant orbital slot. The useful lives applied in the amortization of orbital slots range from 1 to 34 years.

This change in accounting estimate regarding the useful lives of the orbital slots has been accounted for prospectively, beginning on January 1, 2025.

The impact on the balance sheet as at March 31, 2025 was as follows:

(in millions of dollars)
Intangible assets $ (8.6 )
Accumulated earnings $ 8.6

The impact on the statement of income (loss) for the three months ended March 31, 2025 was as follows:

(in millions of dollars)
Amortization $ 8.6

Under IFRS®, a change in the useful life of an orbital slot is an indicator of impairment, requiring an assessment. The Company performed its latest impairment test for orbital slots in the fourth quarter of the year ended December 31, 2024. Given the proximity of that assessment to the change in useful life, the Company reevaluated the key assumptions and determined that there were no material changes that would significantly affect the recoverable amount. Accordingly, the Company relied on this assessment to support its impairment conclusion as of the date the useful life was revised.

Future Changes in Accounting Policies

The International Accounting Standards Board (“IASB”) periodically issues new and amended accounting standards. The new and amended standards determined to be applicable to the Company are disclosed below. The remaining new and amended standards have been excluded as they are not applicable.

IFRS 18, Presentation and Disclosures in Financial Statements

In April 2024, the IASB issued IFRS 18, Presentation and Disclosures in Financial Statements (“IFRS 18”) with the aim of improving companies’ reporting of financial performance and giving investors a better basis for analyzing and comparing companies.

IFRS 18 introduces three new sets of requirements:

  1. Improved comparability in the statement of profit or loss (income statement) which introduces three defined categories for income and expenses: operating, investing and financing. These changes would require all companies to use the same structure of the income statement and provide new defined subtotals, including operating profit.

7

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. MATERIAL ACCOUNTING POLICY INFORMATION (cont.)

  1. Enhanced transparency of management-defined performance measures which would require companies to disclose explanations of those company specific measures that are related to the income statement.

  2. More useful grouping of information in the financial statements which provides enhanced guidance on how to organize information and whether to provide it in the primary financial statements or in the notes.

IFRS 18 is effective for annual reporting periods beginning on or after January 1, 2027, with early adoption permitted. The Company is currently evaluating the impact of this new standard.

  1. SEGMENT INFORMATION

The Company reports under two operating segments which are GEO and LEO. Transactions that do not belong to a particular operating segment, such as certain corporate entities, are reported within “Other”.

The Company’s Chief Operating Decision Maker (“CODM”), who is the Company’s Chief Executive Officer, is provided with information to review the operating results, assess performance of the operations and make capital allocation decisions at the operating segment level comprising GEO and LEO. The accounting policies of the reportable segments are the same as those described in Note 2 and Note 3 above.

The segment information regularly reviewed by the CODM and the reconciliation thereof to the net income (loss) as well as the capital expenditures by operating segment are included in the following tables:

Three months ended March 31, 2025 GEO LEO Other Consolidated
Revenue $ 115,133 $ 1,616 $ — $ 116,749
Operating expenses, net of share-based compensation and non-recurring <br>items(1) (29,660 ) (18,478 ) (1,204 ) (49,342 )
Adjusted EBITDA(1) $ 85,473 (16,862 ) (1,204 ) 67,407
Share-based compensation (3,241 )
Non-recurring items(2) (459 )
Depreciation (25,909 )
Amortization (10,899 )
Other operating gains (losses), net 3,950
Operating income 30,849
Interest expense (56,664 )
Gain (loss) on foreign exchange 2,480
Gain (loss) on changes in fair value of financial instruments (33,412 )
Interest and other income 6,208
Income (loss) before income taxes (50,539 )
Tax (expense) recovery (918 )
Net income (loss) (51,457 )
Capital expenditures $ 408 $ 178,120 $ — $ 178,528

8

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. SEGMENT INFORMATION (cont.)
Three months ended March 31, 2024 GEO LEO Other Consolidated
Revenue $ 148,121 $ 4,054 $ — $ 152,175
Operating expenses, net of share-based compensation and non-recurring <br>items(1) (25,183 ) (15,311 ) (940 ) (41,434 )
Adjusted EBITDA(1) $ 122,938 $ (11,257 ) $ (940 ) 110,741
Share-based compensation (5,434 )
Non-recurring items(2) (244 )
Depreciation (36,395 )
Amortization (2,823 )
Other operating gains (losses), net 15
Operating income 65,860
Interest expense (64,430 )
Interest and other income 21,128
Gain (loss) on foreign exchange (68,413 )
Income (loss) before income taxes (45,855 )
Tax (expense) recovery (6,482 )
Net income (loss) $ (52,337 )
Capital expenditures $ 1,124 $ 24,266 $ — $ 25,390

____________

(1)      The performance of each segment is evaluated by the CODM based on Adjusted EBITDA. Adjusted EBITDA is defined as operating income (excluding certain operating expenses such as share-based compensation expenses and unusual and non-recurring items, including restructuring related expenses) before interest expense, taxes, depreciation and amortization. Adjusted EBITDA margin is used to measure Telesat’s operating performance.

(2)      Non-recurring items includes severance payments and special compensation and benefits for executives and employees.

Service Revenue

The Company derives revenue from the following services:

Broadcast — Direct-to-home television, video distribution and contribution, and occasional use services.

Enterprise — Telecommunication carrier and integrator, government, consumer broadband, resource, maritime and aeronautical, retail and satellite operator services.

Consulting and other — Consulting services related to space and earth segments, government studies, satellite control services, and research and development.

Consolidated

Revenue derived from the above services were as follows:

Three months ended March 31, 2025 2024
Broadcast $ 55,056 $ 72,512
Enterprise 56,843 72,843
Consulting and other 4,850 6,820
Total revenue $ 116,749 $ 152,175

9

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. SEGMENT INFORMATION (cont.)

Equipment sales included within the various services were as follows:

Three months ended March 31, 2025 2024
Enterprise $ 1,148 $ 5,127
Equipment sales $ 1,148 $ 5,127

All revenue from equipment sales relates to the GEO segment.

Operating Segments

Revenue derived from the GEO operating segment was as follows:

For the three months ended March 31, 2025 2024
Broadcast $ 55,056 $ 72,512
Enterprise 56,843 72,843
Consulting and other 3,234 2,766
Revenue $ 115,133 $ 148,121

Revenue derived from the LEO operating segment was as follows:

For the three months ended March 31, 2025 2024
Consulting and other 1,616 4,054
Revenue $ 1,616 $ 4,054

Geographic Information

Revenue by geographic regions was based on the point of origin of the revenue, which was the destination of the billing invoice, and was allocated as follows:

Three months ended March 31, 2025 2024
Canada $ 58,540 $ 70,906
United States 38,579 55,623
Europe, Middle East & Africa 7,590 8,082
Latin America & Caribbean 7,550 9,073
Asia & Australia 4,490 8,491
Revenue $ 116,749 $ 152,175

For the three months ended March 31, 2025 and 2024, all revenue from the LEO segment was from the United States geographic region.

For disclosure purposes, the satellites and the intangible assets have been classified based on ownership. Satellites, property and other equipment and intangible assets by geographic regions were allocated as follows:

As at, March 31,<br>2025 December 31,<br>2024
Canada $ 2,068,909 $ 1,903,673
United Kingdom 337,823 349,619
United States 14,320 14,964
Europe, Middle East & Africa (excluding United Kingdom) 6,454 7,427
All others 1,451 1,460
Satellites, property and other equipment $ 2,428,957 $ 2,277,143

10

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. SEGMENT INFORMATION (cont.)
As at, March 31,<br>2025 December 31,<br>2024
Canada $ 467,811 $ 477,221
United States 7,452 7,896
Latin America & Caribbean 9,165 8,817
All others 2,870 3,532
Intangible assets $ 487,298 $ 497,466

Other long-term assets by geographic regions were allocated as follows:

As at, March 31,<br>2025 December 31,<br>2024
Canada 417,827 516,507
Other long-term assets $ 417,827 $ 516,507

Goodwill was not allocated to geographic regions.

Major Customers

For the three months ended March 31, 2025 and 2024, there were two significant customers each representing more than 10% of consolidated revenue.

  1. OPERATING EXPENSES
Three months ended March 31, 2025 2024
Compensation and employee benefits(a) $ 26,073 $ 25,294
Other operating expenses(b) 20,251 11,121
Cost of sales(c) 6,718 10,697
Operating expenses $ 53,042 $ 47,112

____________

(a)      Compensation and employee benefits included salaries, bonuses, commissions, post-employment benefits and charges arising from share-based compensation.

(b)      Other operating expenses included general and administrative expenses, marketing expenses, in-orbit insurance expenses, professional fees and facility costs. The balance for the three months ended March 31, 2025 included $0.8 million of leases not capitalized due to exemptions and variable lease payments not included in the measurement of the lease liabilities (three months ended March 31, 2024 — $0.5 million).

(c)      Cost of sales included the cost of third-party satellite capacity, the cost of equipment sales and other costs directly attributable to fulfilling the Company’s obligations under customer contracts.

11

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. INTEREST EXPENSE
Three months ended March 31, 2025 2024
Interest on indebtedness $ 56,452 $ 60,168
Interest on satellite performance incentive payments 252 309
Interest on significant financing component 3,284 3,623
Interest on employee benefit plans (265 ) (40 )
Interest on leases 446 370
Capitalized interest (3,505 ) —
Interest expense $ 56,664 $ 64,430
  1. OTHER OPERATING GAINS (LOSSES), NET
Three months ended March 31, 2025 2024
Gain (loss) on disposal of assets $ 3,950 $ 15
Other operating gains (losses), net $ 3,950 $ 15
  1. INCOME TAXES
Three months ended March 31, 2025 2024
Current tax expense (recovery) $ 2,432 $ 7,941
Deferred tax expense (recovery) (1,514 ) (1,459 )
Tax expense (recovery) $ 918 $ 6,482

A reconciliation of the statutory income tax rate, which is a composite of Canadian federal and provincial rates, to the effective income tax rate was as follows:

Three months ended March 31, 2025 2024
Income (loss) before income taxes $ (50,539 ) $ (45,855 )
Multiplied by the statutory income tax rates 26.39 % 26.40 %
(13,337 ) (12,106 )
Income tax recorded at rates different from the Canadian tax rate (1,187 ) (1,587 )
Permanent differences 11,107 12,233
Effect of temporary differences not recognized as deferred tax assets 3,540 10,016
Foreign taxes 535 —
Taxes related to prior periods — (144 )
Impact of foreign exchange 260 (1,930 )
Tax expense (recovery) $ 918 $ 6,482
Effective income tax rate (1.82 )% (14.14 )%
  1. SATELLITES, PROPERTY AND OTHER EQUIPMENT

For the three months ended March 31, 2025, the Company had additions of $178.5 million (March 31, 2024 — $25.4 million) primarily related to acquisitions associated with the LEO program.

12

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. GOODWILL AND INTANGIBLE ASSETS

As stated in Note 3, commencing on January 1, 2025, the orbital slots were accounted for as finite life intangible assets. The change in estimate from indefinite life to finite life and the subsequent amortization on the orbital slots are summarized below.

Orbital slots<br>(indefinite life) Orbital slots<br>(finite life) Total
Cost as at January 1, 2025 $ 611,173 $ — $ 611,173
Transfer to finite life (611,173 ) 611,173 —
Impact of foreign exchange — 1,032 1,032
Cost as at March 31, 2025 $ — $ 612,205 $ 612,205
Accumulated impairment as at January 1, 2025 $ (258,877 ) $ — $ (258,877 )
Transfer to finite life 258,877 (258,877 ) —
Amortization — (8,567) (8,567)
Impact of foreign exchange — (1,033 ) (1,033 )
Accumulated amortization as at March 31, 2025 $ — $ (268,477 ) (268,477 )
Net carrying values
As at December 31, 2024 $ 352,296 $ — $ 352,296
As at March 31, 2025 $ — $ 343,728 $ 343,728

During the first quarter of 2025, we reviewed the most sensitive assumptions to determine whether or not there were any changes in the assumptions from the valuation that was performed at the end of 2024. Based upon this review, there were no changes to the assumptions from the valuation that was performed at the end of 2024, and as such there was no impairment on goodwill, orbital slots or trade name.

  1. LEASE LIABILITIES

The expected undiscounted contractual cash flows of the lease liabilities as at March 31, 2025 were as follows:

Remainder<br>2025 2026 2027 2028 2029 Thereafter Total
$2,597 $ 3,946 $ 3,862 $ 3,912 $ 3,988 $ 36,319 $ 54,624

The undiscounted contractual cash flows included $17.7 million of interest payments.

13

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. INDEBTEDNESS
As at, March 31,<br>2025 December 31,<br>2024
Senior Secured Credit Facilities
Term Loan B – U.S. Facility(1) <br>(March 31, 2025 and December 31, 2024 – US$1,320,531) $ 1,899,847 $ 1,889,451
Senior Unsecured Notes(2) (March 31, 2025 and December 31, 2024 – US221,250) 318,312 318,246
2026 Senior Secured Notes(3) (March 31, 2025 and December 31, 2024 – US387,047) 556,845 566,728
Senior Secured Notes(4) (March 31, 2025 and December 31, 2024 – US224,995) 323,700 323,633
Government of Canada Telesat Lightspeed Financing(5) 289,019 —
Government of Quebec Telesat Lightspeed Financing(5) 54,022 —
3,441,745 3,098,058
Deferred financing costs, prepayment options, warrants and loss on repayment (88,537 ) (1,443 )
3,353,208 3,096,615
Less: current indebtedness — —
Long-term indebtedness $ 3,353,208 $ 3,096,615

All values are in US Dollars.

____________

(1)      On December 6, 2019, Telesat Canada entered into a new amended and restated Credit Agreement with a syndicate of banks which provides for the extension of credit under the Senior Secured Credit Facilities (“Senior Secured Credit Facilities”). The Senior Secured Credit Facilities are comprised of two tranches — a revolving credit facility of up to $200.0 million US dollars having matured in December 2024 and Term Loan B — U.S. Facility of US$1,908.5 million maturing in December 2026.

(2)      On October 11, 2019, Telesat Canada issued, through a private placement, US$550 million of 6.5% Senior Unsecured Notes, maturing in October 2027 (“Senior Unsecured Notes”).

(3)      On December 6, 2019, Telesat Canada issued, through a private placement, US$400 million 4.875% Senior Secured Notes, maturing in June 2027 (“Senior Secured Notes”).

(4)      On April 27, 2021, Telesat Canada issued, through a private placement, US$500 million in aggregate principal amount of 5.625% Senior Secured Notes maturing in December 2026 (“2026 Senior Secured Notes”).

(5)      On September 13, 2024, Telesat LEO Inc. entered into loan agreements with 16342451 Canada Inc., a subsidiary of Canada Development Investment Corporation (“Government of Canada”) and Investissement Quebec (“Government of Quebec”), for senior secured non-revolving delayed draw term loan facilities in the principal amount of $2,140 million and $400 million, respectively (“Telesat Lightspeed Financing”). Two advances were received during the three months ended March 31, 2025 totaling $286.5 million from the Government of Canada and $53.5 million from the Government of Quebec. The debt balances include $3.0 million of interest that was added to the principal balance of the loan.

Telesat Lightspeed Financing Warrants

As consideration for making available the loan facility, Telesat LEO Inc. entered into agreements with the lenders that irrevocably grant warrants equivalent to 11.87% of the common shares of Telesat LEO Inc. on a fully diluted basis (“Telesat Lightspeed Financing Warrants”). The Telesat Lightspeed Financing Warrants entitle the Government of Canada to acquire 10% and Government of Quebec to acquire 1.87% of Telesat LEO Inc.’s total shares on fully diluted basis, which were fair valued upon the completion of the conditions precedent.

14

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. INDEBTEDNESS (cont.)

The Telesat Lightspeed Financing Warrants are exercisable in whole or in part, using a cash or cashless exercise feature (at the sole discretion of holder), at any time after the second anniversary of the date of issuance of the warrants and up to 10 years from the issuance date (subject to certain terms and conditions of the warrant agreement). The standard cash exercise of the warrants meets the definition of gross-settled equity instruments; on the other hand, if the cashless exercise is used, the number of shares will vary depending on fair market value of the Telesat LEO Inc. common shares at the time of exercise. Consequently, the Telesat Lightspeed Financing Warrants fail to meet fixed-for-fixed criteria for equity classification and have been designated at fair value through profit and loss classified as a Level 3 instrument (Note 19).

Deferred Financing Charges

Deferred financing charges include the debt issue costs associated with the Telesat Lightspeed Financing and the initial value of the Telesat Lightspeed Financing Warrants granted to the Government of Canada and the Government of Quebec. As drawdowns are made against the Telesat Lightspeed Financing, the proportional amount of the deferred financing charges will be transferred to debt issue costs against the long-term indebtedness and amortized to interest expense using the effective interest method.

The activity in deferred financing charges for the three months ended March 31, 2025 is as follows:

Telesat Lightspeed<br>Financing<br>Warrants Debt issue costs Total
As at December 31, 2024 $ 617,476 $ 37,468 $ 654,944
Additions — 1,000 1,000
Transferred to debt issue costs (80,888 ) (5,055 ) (85,943 )
Impact of foreign exchange (1,655 ) 40 (1,615 )
As at March 31, 2025 $ 534,933 $ 33,453 $ 568,386
  1. SHARE CAPITAL

The Class A Common shares together with the Class B Variable Voting shares represent the Corporation’s Public Shares (“Telesat Public Shares”). The Class C Fully Voting shares and Class C Limited Voting shares shall be referred to as (“Class C Shares”). The Telesat Public Shares and Class C Shares together represent Telesat Corporation Shares (“Telesat Corporation Shares”).

The number of shares and stated value of the outstanding shares were as follows:

March 31, 2025 December 31, 2024
Number of<br>shares Stated<br>value Number of<br>shares Stated<br>value
Telesat Public Shares 14,362,541 $ 59,631 14,080,010 $ 52,742
Class C Shares 112,841 6,340 112,841 6,340
14,475,382 $ 65,971 14,192,851 $ 59,082

The breakdown of the number of shares of Telesat Public Shares, as at March 31, 2025, was as follows:

Telesat Public shares
Class A Common shares 3,061,121
Class B Variable Voting shares 11,301,420
Total Telesat Public shares 14,362,541

15

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. SHARE CAPITAL (cont.)

The number of Class A Common shares and Class B Variable Voting shares in the table above is based on information available to the Company as at March 31, 2025.

In addition, the Company has one Class A Special Voting Share, one Class B Special Voting Share, one Class C Special Voting Share and one Golden Share outstanding, each with a nominal stated value as at March 31, 2025 and December 31, 2024. The voting rights of the Special Voting Shares and the Golden Share are more fully described in the Company’s Annual Report filed on Form 20-F for the year ended December 31, 2024 that can be obtained on the SEC’s website at https://www.sec.gov and on the SEDAR+ at https://www.sedarplus.ca.

During the three months ended March 31, 2025, 443,485 Restricted Share Units (“RSUs”) were settled for 223,671 Telesat Public Shares, on a net settlement basis (Three months ended March 31, 2024 — 285,985 RSUs were settled for 131,084 Telesat Public Shares, on a net settlement basis).

During the three months ended March 31, 2025, 93,454 Performance Share Units (“PSUs”) were settled for 46,360 Telesat Public Shares. There were no settlements of PSUs in the three months ended March 31, 2024.

During the three months ended March 31, 2024, 12,434 Deferred Share Units (“DSUs”) were settled for an equal number of Telesat Public Shares. There were no settlements of DSUs in the three months ended March 31, 2025.

During the three months ended March 31, 2025, 12,500 Telesat Public Shares were issued in exchange for an equal number of Class A Limited Partnership units (“LP Units”) in Telesat Partnership LP (the “Partnership”). There were no settlements of exchanges of LP Units for Telesat Public Shares in the three months ended March 31, 2024.

The number and stated value of the outstanding LP Units of the Partnership as at March 31, 2025 and December 31, 2024 were as follows:

March 31, 2025 December 31, 2024
Number of<br>shares Stated<br>value Number of<br>shares Stated<br>value
Class A and Class B LP Units 18,309,292 $ 50,107 18,321,792 $ 50,141
Class C LP Units 18,098,362 38,893 18,098,362 38,893
36,407,654 $ 89,000 36,420,154 $ 89,034

On consolidation into the Corporation, the stated value of the LP Units is included under non-controlling interest.

  1. NON-CONTROLLING INTEREST

Non-controlling interests represent equity interests in the Partnership that are not attributable to the Company. As at March 31, 2025, the Corporation held a general partnership interest representing approximately 28% economic interest in the Partnership (December 31, 2024 — approximately 28%). The remaining 72% economic interest represents exchangeable units held by the limited partnership unit holders (December 31, 2024 — 72%).

Net income (loss) attributable to non-controlling interests represents the non-controlling interests’ portion of the Partnership’s net income (loss).

  1. SHARE-BASED COMPENSATION PLANS

On November 19, 2021, Telesat Corporation adopted an omnibus long-term incentive plan (“Omnibus Plan”). The Omnibus Plan allows for a variety of equity-based awards including stock options, RSUs, DSUs and PSUs. The stock options, RSUs, DSUs and PSUs are collectively referred to as “Award”. Each Award will represent the right to receive Public Shares or, in the case of PSUs, RSUs or DSUs, Public Shares or cash, in accordance with the terms of the Omnibus Plan.

16

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. SHARE-BASED COMPENSATION PLANS (cont.)

Telesat Holdings Inc. (the predecessor entity to Telesat Canada and Telesat Corporation) adopted a management stock incentive plan in September 2008, as amended (the “2008 Telesat Plan”) and a second management stock incentive plan in April 2013, as amended (the “2013 Telesat Plan”). In the first half of 2021, Telesat Canada also adopted a restricted share unit plan (the “RSU Plan” together with the 2008 Telesat Plan and 2013 Telesat Plan, the “Historic Plan”).

The changes in number of time vesting stock options outstanding and their weighted average exercise price under the Omnibus Plan and Historic Plan have been summarized below:

Historic plan Omnibus Plan
Number of<br>options Weighted<br>average exercise<br>price Number of<br>options Weighted<br>average exercise<br>price
Outstanding, January 1, 2025 52,628 $ 70.83 773,178 $ 13.35
Forfeited — (15,684 )
Outstanding March 31, 2025 52,628 $ 70.83 757,494 $ 13.38

The movement under the Historic Plan was as follows:

RSUs with<br>time and<br>performance<br>criteria
Outstanding, January 1, 2025 124,080
Forfeited —
Outstanding, March 31, 2025 124,080

The movement under the Omnibus Plan was as follows:

RSUs with<br>time criteria PSUs with<br>time and<br>performance<br>criteria DSUs
Outstanding, January 1, 2025 964,705 555,162 189,434
Granted — — 10,999
Settled (443,485 ) (93,454 ) —
Forfeited (41,785 ) (31,437 ) —
Outstanding, March 31, 2025 479,435 430,271 200,433
  1. EARNINGS PER SHARE

Basic earnings per share is calculated by dividing the net income (loss) for the period attributable to shareholders of each class of shares by the weighted average number of shares outstanding during the period.

Diluted earnings per share is calculated to give effect to equity Awards.

The following table presents reconciliations of the numerators of the basic and diluted per share computations:

Three months ended March 31 2025 2024
Net income (loss) attributable to Telesat Common Shares $ (15,538 ) $ (14,762 )
Effect of diluted securities — —
Diluted net income (loss) attributable to Telesat Common Shares $ (15,538 ) $ (14,762 )

17

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. EARNINGS PER SHARE (cont.)

The following table presents reconciliations of the denominators of the basic and diluted per share computations:

Three months ended March 31 2025 2024
Basic total weighted average number of Telesat Common Shares outstanding 14,381,205 13,706,546
Effect of diluted securities
Stock options — —
RSUs, DSUs and PSUs — —
Diluted total weighted average number of Telesat Common Shares <br>outstanding 14,381,205 13,706,546

Effect of diluted securities represents Telesat Public Shares and Class C Shares assumed to be issued for no consideration. The difference between the number of Telesat Public Shares and Class C Shares assumed issued on exercise and the number of Telesat Public Shares and Class C Shares assumed repurchased are treated as an issue of common shares for no consideration.

For the purpose of earnings per share, all of the Telesat Public Shares and Class C Shares have equivalent economic rights.

  1. GOVERNMENT GRANT

In May 2019, Telesat entered into an agreement for a non-refundable government contribution of a value up to $85 million relating to the Telesat Lightspeed constellation.

For the three months ended March 31, 2025, the Company recorded no claims made against the government grant (three-months ended March 31, 2024 — $2.6 million).

Of the amount recorded during the three months ended March 31, 2024, $0.3 million was recorded as a reduction to satellites, property and other equipment and $2.3 million was recorded as a reduction to operating expenses.

  1. CAPITAL DISCLOSURES

The Company’s financial strategy is designed to maintain compliance with the financial covenant under its Telesat Canada Debt and Telesat Lightspeed Financing and to maximize returns to its shareholders and other stakeholders. The Company meets these objectives through regular monitoring of the financial covenant and operating results on a quarterly basis.

The Company defines its capital as Telesat Corporation’s shareholders’ equity (comprising issued share capital, accumulated earnings and excluding reserves), non-controlling interest and debt financing (comprising indebtedness and excluding deferred financing costs, prepayment options, warrants and loss on repayment as defined in Note 12).

The Company’s capital was as follows:

As at March 31, <br>2025 December 31, <br>2024
Shareholders’ equity (excluding reserves) $ 522,663 $ 526,415
Non-controlling interest $ 1,734,856 $ 1,786,425
Debt financing (excluding deferred financing costs, prepayment options, warrants and loss on repayment) $ 3,441,745 $ 3,098,058

The Company’s operating results are tracked against budget and this analysis is reviewed by senior management.

18

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. FINANCIAL INSTRUMENTS

Measurement of Risks

The Company, through its financial assets and liabilities, is exposed to various risks. The following analysis provides a measurement of risks as at March 31, 2025.

Credit risk

Credit risk is the risk that a counterparty to a financial asset will default, resulting in the Company incurring a financial loss. As at March 31, 2025, the maximum exposure to credit risk is equal to the carrying value of the financial assets which totaled $873.3 million (December 31, 2024 — $721.3 million).

The following table provides breakdown by maturity of financial assets as at March 31, 2025:

Carrying<br>amount Contractual cash flows
Remaining<br>2025 2026 2027 2028 2029 Thereafter
Cash and cash equivalents $ 797,371 $ 797,371 $ — $ — $ — $ — $ —
Trade and other receivables, excluding deferred receivables 57,904 57,904 — — — — —
Deferred receivables 16,287 3,456 9,589 741 617 555 1,329
Other financial assets 1,751 685 — — — — 1,066
$ 873,313 $ 859,416 $ 9,589 $ 741 $ 617 $ 555 $ 2,395

Cash and cash equivalents are invested with high quality investment grade financial institutions and are governed by the Company’s corporate investment policy, which aims to reduce credit risk by restricting investments to high-grade, mainly U.S. dollar and Canadian dollar denominated investments.

The Company has credit evaluation, approval and monitoring processes intended to mitigate potential credit risks related to trade accounts receivable. The Company’s standard payment terms are 30 days with interest typically charged on balances remaining unpaid at the end of standard payment terms. The Company’s historical experience with customer defaults has been minimal. As at March 31, 2025, North American and International customers made up 65% and 35% of the outstanding trade receivable balance, respectively (December 31, 2024 — 48% and 52%, respectively). Anticipated bad debt losses have been provided for in the allowance for doubtful accounts. The allowance for doubtful accounts as at March 31, 2025 was $9.0 million (December 31, 2024 — $8.9 million).

The Company mitigates the credit risk associated with derivative instruments by entering into them with only high-quality financial institutions.

Foreign exchange risk

The Company’s operating results are subject to fluctuations as a result of exchange rate variations to the extent that transactions are made in currencies other than Canadian dollars. The Company’s main currency exposures lie in its U.S. dollar denominated cash and cash equivalents, trade and other receivables, trade and other payables and indebtedness with the most significant impact being on the U.S. dollar denominated indebtedness, cash and short-term investments. As at March 31, 2025, a portion of the indebtedness was denominated in U.S. dollars, with the Canadian dollar equivalent of the U.S. dollar denominated indebtedness equaling $3,098.7 million, before netting of deferred financing costs, prepayment options and loss on repayment. As at December 31, 2024, the entire indebtedness was denominated in U.S. dollars, with the Canadian dollar equivalent of the U.S. dollar denominated indebtedness equaling $3,098.1 million, before netting of deferred financing costs, prepayment options and loss on repayment.

19

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. FINANCIAL INSTRUMENTS (cont.)

In addition, there is also an impact as a result of the exchange rate variations to the extent that transactions are denominated in Canadian dollars in entities who have a functional currency other than Canadian dollars with the most significant impact being on the Telesat Lightspeed Warrant derivative liabilities and Telesat Lightspeed Financing indebtedness. As at March 31, 2025, the derivative liabilities and indebtedness had balances of $650.5 million and $343.0 million, respectively (December 31, 2024 — $617.1 million and $Nil, respectively).

As at March 31, 2025, the impact of a 5 percent increase (decrease) in the value of the U.S. dollar against the Canadian dollar on financial assets and liabilities would have decreased (increased) net income (loss) by $192.7 million (December 31, 2024 — $185.0 million) and increased (decreased) other comprehensive income (loss) by $22.5 million (December 31, 2024 — $13.4 million). This analysis assumes that all other variables, in particular interest rates, remain constant.

Interest rate risk

The Company is exposed to interest rate risk on its cash and cash equivalents and its indebtedness. The interest rate risk on the indebtedness is from a portion of the indebtedness having a variable interest rate. Changes in the interest rates could impact the amount of interest that the Company is required to pay or receive.

If the interest rates on the variable rate indebtedness change by 0.25%, the result would be an increase or decrease to net income (loss) of $1.3 million for three months ended March 31, 2025 (three months ended March 31, 2024 — $1.2 million).

Liquidity risk

The Company maintains credit facilities to ensure it has sufficient funds available to meet current and foreseeable financial requirements.

The contractual maturities of financial liabilities as at March 31, 2025 were as follows:

Carrying<br>amount Contractual<br>cash flows<br>(undiscounted) Remaining<br>2025 2026 2027 2028 2029 Thereafter
Trade and other payables $ 92,664 $ 92,664 $ 92,664 $ — $ — $ — $ — $ —
Customer and other deposits 1,402 1,402 606 492 — — — 304
Satellite performance incentive payments 15,143 18,146 3,314 3,602 2,752 2,630 2,630 3,218
Derivative liabilities 650,493 650,493 — — — — — 650,493
Other financial liabilities 2,526 2,526 2,526 — — — — —
Indebtedness(1) 3,478,773 7,509,462 222,221 2,656,350 670,593 228,856 500,790 3,230,652
$ 4,241,001 $ 8,274,693 $ 321,331 $ 2,660,444 $ 673,345 $ 231,486 $ 503,420 $ 3,884,667

____________

(1)      Indebtedness excludes deferred financing costs, prepayment options, warrants and loss on repayment. The contractual cash flows for Telesat Lightspeed Financing include anticipated future drawings and mandatory repayments against the loan.

The interest payable and interest payments included in the carrying value and contractual cash flows, respectively, in the above table, were as follows:

Interest<br>payable Interest<br>payments
Satellite performance incentive payments $ 271 $ 3,274
Indebtedness $ 37,028 $ 1,452,101

20

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. FINANCIAL INSTRUMENTS (cont.)

Financial assets and liabilities recorded on the balance sheets and the fair value hierarchy levels used to calculate those values were as follows:

As at March 31, 2025 Amortized<br>cost Fair value<br>through<br>profit or loss Fair value Fair value<br>hierarchy
Cash and cash equivalents $ 797,371 $ — $ 797,371 Level 1
Trade and other receivables 62,304 — 62,304 ​(1)
Other current financial assets 685 — 685 Level 1
Other long-term financial assets 12,953 — 12,953 Level 1
Trade and other payables (92,664 ) — (92,664 ) ​(1)
Other current financial liabilities (43,419 ) — (43,579 ) Level 2
Other long-term financial liabilities (12,680 ) (650,493 ) (662,870 ) Level 2, Level 3
Indebtedness(2) (3,441,745 ) — (1,999,699 ) Level 2
$ (2,717,195 ) $ (650,493 ) $ (1,925,499 )
As at December 31, 2024 Amortized<br>cost Fair value<br>through<br>profit or loss Fair value Fair value<br>hierarchy
--- --- --- --- --- --- --- --- --- --- ---
Cash and cash equivalents $ 552,064 $ — $ 552,064 Level 1
Trade and other receivables 158,930 — 158,930 ​(1)
Other current financial assets 565 — 565 Level 1
Other long-term financial assets 9,767 — 9,767 Level 1
Trade and other payables (158,276 ) — (158,276 ) ​(1)
Other current financial liabilities (26,483 ) — (26,272 ) Level 2
Other long-term financial liabilities (13,421 ) (617,135 ) (630,962 ) Level 2, Level 3
Indebtedness(2) (3,098,058 ) — (1,688,023 ) Level 2
$ (2,574,912 ) $ (617,135 ) $ (1,782,207 )

____________

(1)      Trade and other receivables and trade and other payables approximate fair value due to the short-term maturity of these instruments.

(2)      Indebtedness excludes deferred financing costs, prepayment options, warrants and loss on repayment.

Assets pledged as security

The Senior Secured Credit Facilities, Senior Secured Notes and 2026 Senior Secured Notes are secured by substantially all of Telesat’s assets excluding the assets of unrestricted subsidiaries.

The Telesat Lightspeed Financing is secured by substantially all of the assets of the unrestricted subsidiaries of Telesat.

Fair Value

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants in the principal market under current market conditions at the measurement date. Where possible, fair values are based on the quoted market values in an active market. In the absence of an active market, the Company determines fair values based on prevailing market rates (bid and ask prices, as appropriate) for instruments with similar characteristics and risk profiles or internal or external valuation models, such as option pricing models and discounted cash flow analysis, using observable market-based inputs.

21

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. FINANCIAL INSTRUMENTS (cont.)

The fair value hierarchy is as follows:

Level 1 is based on quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company can access at the measurement date.

Level 2 is based on observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially all of the full term of the assets or liabilities.

Level 3 is based on unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose values are determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation.

Estimates of fair values are affected significantly by the assumptions for the amount and timing of estimated future cash flows and discount rates, which all reflect varying degrees of risk. Potential income taxes and other expenses that would be incurred on disposition of these financial instruments are not reflected in the fair values. As a result, the fair values are not necessarily the net amounts that would be realized if these instruments were actually settled.

The carrying amounts of cash and cash equivalents, trade and other receivables, and trade and other payables approximate fair value due to the short-term maturity of these instruments. As at March 31, 2025, cash and cash equivalents included $33.3 million (December 31, 2024 — $13.3 million) of short-term investments.

The fair value of the satellite performance incentive payments, included in other current and long-term financial liabilities, was determined using a discounted cash flow methodology. The calculation is performed on a recurring basis. As at March 31, 2025 and December 31, 2024, the discount rate used was 7.2% and 7.3%, respectively.

The fair value of the indebtedness was based on transactions and quotations from third parties considering market interest rates and excluding deferred financing costs, prepayment options and loss on repayment. The calculation of the fair value of the indebtedness is performed on a recurring basis. The rates used, which are a percentage of face value of the indebtedness, were as follows:

March 31,<br>2025 December 31,<br>2024
Term Loan B – U.S. Facility – Senior Secured Credit Facilities 57.00 % 55.88 %
Senior Unsecured Notes 45.23 % 40.66 %
Senior Secured Notes 57.14 % 56.10 %
2026 Senior Secured Notes 59.99 % 56.72 %

The rate used in the calculation of the fair value of the Telesat Lightspeed Financing, which is a percentage of face value of the indebtedness, was 74.65%. The fair value of the Telesat Lightspeed Financing excludes deferred financing costs and warrants.

Fair value of derivative financial instruments

Derivatives were valued using a discounted cash flow methodology. The calculations of the fair value of the derivatives are performed on a recurring basis.

Prepayment option cash flows were calculated with a third party option valuation model which is based on the current price of the debt instrument and discounted based on a discount curve.

The discount rates used to discount cash flows as at March 31, 2025 ranged from 4.05% to 4.62% (December 31, 2024 — 4.37% to 4.63%).

22

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. FINANCIAL INSTRUMENTS (cont.)

Telesat Lightspeed Financing Warrants were valued based upon an option pricing framework, incorporating an American-style exercise option, which allows for early exercise before expiry. In determining the unobservable inputs, the company uses observable market inputs such as industry reports, interest rate yield curves, current rates and price and rate volatilities, as applicable, to develop assumptions regarding those unobservable inputs.

For the three-months ended March 31, 2025, the value of the Telesat Financing Warrants was as follows:

Government of<br>Canada Government of<br>Quebec Total
As at December 31, 2024 $ 519,948 $ 97,187 $ 617,135
Change in fair value 28,150 5,262 33,412
Impact of foreign exchange (45 ) (9 ) (54 )
As at March 31, 2025 $ 548,053 $ 102,440 $ 650,493
  1. EMPLOYEE BENEFIT PLANS

The expenses included on the condensed consolidated statements of income (loss) were as follows:

Pension Plans Other Post-employment<br>Benefit Plans
Three months ended March 31, 2025 Canadian US Total Canadian US Total
Consolidated statements of income (loss)
Operating expenses $ 1,061 $ 138 $ 1,199 $ 167 $ — $ 167
Interest (income) expense $ (618 ) $ 36 $ (582 ) $ 263 $ 54 $ 317
Pension Plans Other Post-employment<br>Benefit Plans
--- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Three months ended March 31, 2024 Canadian US Total Canadian US Total
Consolidated statements of income (loss)
Operating expenses $ 1,087 $ 175 $ 1,262 $ 147 $ — $ 147
Interest (income) expense $ (421 ) $ 100 $ (321 ) $ 235 $ 46 $ 281

No amounts were recorded on the statements of comprehensive income (loss) for the three months ended March 31, 2024 or 2023.

The balance sheet obligations, distributed between pension and other post-employment benefits were as follows:

Pension Plans Other Post-employment<br>Benefit Plans
As at March 31, 2025 Canadian US Total Canadian US Total
Included in other long-term liabilities $ 41,967 $ 2,918 $ 44,885 $ 22,644 $ 3,513 $ 26,157
Included in other long-term assets $ 99,621 $ — $ 99,621 $ — $ — $ —
Pension Plans Other Post-employment<br>Benefit Plans
--- --- --- --- --- --- --- --- --- --- --- --- ---
As at December 31, 2024 Canadian US Total Canadian US Total
Included in other long-term liabilities $ 41,540 $ 2,993 $ 44,533 $ 22,394 $ 3,547 $ 25,941
Included in other long-term assets $ 99,554 $ — $ 99,554 $ — $ — $ —

23

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. SUPPLEMENTAL CASH FLOW INFORMATION

Cash and cash equivalents were comprised of the following:

As at March 31, 2025 2024
Cash $ 764,098 $ 1,683,347
Short-term investments(1) 33,273 72,952
Cash and cash equivalents $ 797,371 $ 1,756,299

____________

(1)      Consisted of short-term investments with an original maturity of three months or less or which are available on demand with no penalty for early redemption.

Income taxes paid, net of income taxes received was comprised of the following:

Three months ended March 31, 2025 2024
Income taxes paid $ (1,580 ) $ (18,384 )
Income taxes received — 6,888
$ (1,580 ) $ (11,496 )

Interest paid, net of interest received was comprised of the following:

Three months ended March 31, 2025 2024
Interest paid $ (36,708 ) $ (40,344 )
Interest received 5,358 22,197
$ (31,350 ) $ (18,147 )

The reconciliation of the liabilities arising from financing activities were as follows:

Indebtedness Satellite<br>performance<br>incentive<br>payments Lease<br>liabilities
Balance as at January 1, 2025 $ 3,096,615 $ 15,060 $ 33,375
Cash inflows 340,000 — —
Cash outflows — (190 ) (515 )
Amortization of deferred financing costs, prepayment options, warrants and loss on repayment 727 — —
Interest paid — — (446 )
Interest accrued 3,076 — 446
Non-cash transfer from deferred charges to indebtedness of debt issue costs and warrants (85,943 ) — —
Non-cash addition — — 4,215
Impact of foreign exchange (1,267 ) 2 (82 )
Balance as at March 31, 2025 $ 3,353,208 $ 14,872 $ 36,993

24

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. SUPPLEMENTAL CASH FLOW INFORMATION (cont.)
Indebtedness Satellite<br>performance<br>incentive<br>payments Lease liabilities
Balance as at January 1, 2024 $ 3,197,019 $ 18,271 $ 33,339
Cash outflows — (711 ) (647 )
Amortization of deferred financing costs, prepayment options and loss on repayment 246 — —
Interest paid — — (370 )
Interest accrued — — 370
Non-cash addition — — 297
Impact of foreign exchange 71,749 403 121
Balance as at March 31, 2024 $ 3,269,014 $ 17,963 $ 33,110

The net change in operating assets and liabilities was comprised of the following:

Three months ended March 31, 2025 2024
Trade and other receivables $ 98,059 $ 12,392
Financial assets (3,305 ) 25
Other assets (3,346 ) (968 )
Trade and other payables (1,573 ) 5
Financial liabilities 325 123
Other liabilities 28,612 (4,624 )
$ 118,772 $ 6,953

Non-cash investing activities were comprised of:

Three months ended March 31, 2025 2024
Satellites, property and other equipment $ 52,309 $ 13,028
  1. COMMITMENTS AND CONTINGENT LIABILITIES

The following were the Company’s off-balance sheet contractual obligations as at March 31, 2025:

Remaining<br>2025 2026 2027 2028 2029 Thereafter Total
Property leases $ 1,378 $ 1,312 $ 1,209 $ 1,209 $ 1,209 $ 12,898 $ 19,215
Capital commitments 677,368 5,755 6,474 — — — 689,597
Other operating commitments 20,445 11,448 9,359 20,518 19,147 52,966 133,883
$ 699,191 $ 18,515 $ 17,042 $ 21,727 $ 20,356 $ 65,864 $ 842,695

Property leases consisted of off-balance sheet contractual obligations for land or building usage, while capital commitments included commitments for capital projects. Other operating commitments consisted of third-party satellite capacity arrangements as well as other commitments that are not categorized as property leases or capital commitments. The Company’s off-balance sheet obligations included the future minimum payments for the non-cancellable period of each respective obligation, which have various terms and expire between 2025 to 2045.

Certain variable costs associated with the capitalized leases have been included in property leases commitments with a termination date co-terminus with the lease liability.

25

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. COMMITMENTS AND CONTINGENT LIABILITIES (cont.)

The Company has entered into contracts for the development of the Telesat Lightspeed constellation and other capital expenditures. The outstanding commitments as at March 31, 2025 were included in capital commitments.

The Company has agreements with various customers for prepaid revenue on several service agreements which take effect when the satellite is placed in service. The Company is responsible for operating and controlling these satellites. As at March 31, 2025, customer prepayments of $233.3 million (December 31, 2024 — $243.0 million), a portion of which is refundable under certain circumstances, were reflected in other current and long-term liabilities.

In the normal course of business, the Company has executed agreements that provide for indemnification and guarantees to counterparties in various transactions. These indemnification undertakings and guarantees may require the Company to compensate the counterparties for costs and losses incurred as a result of certain events including, without limitation, loss or damage to property, change in the interpretation of laws and regulations (including tax legislation), claims that may arise while providing services, or as a result of litigation that may be suffered by the counterparties. The nature of substantially all of the indemnification undertakings prevents the Company from making a reasonable estimate of the maximum potential amount the Company could be required to pay counterparties as the agreements do not specify a maximum amount and the amounts are dependent upon the outcome of future contingent events, the nature and likelihood of which cannot be determined at this time. Historically, the Company has not made any significant payments under such indemnifications.

Telesat Corporation and Telesat CanHold Corporation have entered into an indemnification agreement with Public Sector Pension Investment Board (“PSP Investments”) where they will indemnify PSP Investments on a grossed-up basis for PSP Investment’s pro rata share of the costs relating to: (a) certain losses and litigation proceedings related to the transaction to become a public company in 2021, (b) certain losses with regard to Loral Space & Communications Inc. (“Loral”) and out-of-pocket expenses of Loral and (c) certain tax matters.

In the case of indemnification for certain tax matters only, there will be a cap of US$50 million (other than with respect to defense costs and grossed-up payments) and all other indemnification obligations will be uncapped.

Legal Proceedings

The Company participates from time to time in legal proceedings arising in the normal course of its business.

Telesat previously received assessments from Brazilian tax authorities alleging that additional taxes are owed on revenue earned for the period 2002 to 2021. The total disputed amount for the period 2002 to 2021, including interest and penalties, is now $103.5 million. The disputes relate to the Brazilian tax authorities’ characterization of revenue. The Company has challenged the assessments. The Company believes the likelihood of a favorable outcome in these disputes is more likely than not and, as such, no reserve has been established.

Other than the legal proceedings disclosed above and in Note 34 of the Company’s December 31, 2024 consolidated financial statements, the Company is not aware of any proceedings outstanding or threatened as of the date hereof by or against it or relating to its business which may have, or have had in the recent past, significant effects on the Company’s financial position or profitability.

  1. RELATED PARTY TRANSACTIONS

Transactions with subsidiaries

The Company and its subsidiaries regularly engage in inter-group transactions. These transactions include the purchase and sale of satellite services and communications equipment, providing and receiving network and call centre services, access to orbital slots and management services. The transactions have been entered into over the normal course of operations. Balances and transactions between the Company and its subsidiaries have been eliminated on consolidation and therefore have not been disclosed.

26

Telesat Corporation Notes to the Unaudited Interim Condensed Consolidated Financial Statements March 31, 2025 (all amounts in thousands of Canadian dollars, except where otherwise noted)

  1. RELATED PARTY TRANSACTIONS (cont.)

Compensation of executives and Board level directors

Compensation of the Company’s executives consists of short-term benefits (including salaries), post-employment benefits and share-based compensation. Compensation of the Company’s Board level directors consists of cash and share-based compensation. The transactions have been entered into with the Company in the normal course of operations.

Transactions with related parties

The Company and certain of its subsidiaries regularly engage in transactions with related parties. The Company’s related parties included Red Isle Private Investments Inc. (“Red Isle”) and MHR. There were no transactions or balances with Red Isle or MHR during any of the periods presented.

Other related party transactions

The Company funds certain defined benefit pension plans. Contributions made to the plans for the three months ended March 31, 2025 were $0.6 million (Three months ended March 31, 2024 — $0.6 million).

27

Item 2.    Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following management’s discussion and analysis (the “MD&A”) should be read in conjunction with Telesat Corporation’s unaudited interim condensed consolidated financial statements and the related notes for the three-month period ended March 31, 2025.

As used in this MD&A, unless the context states or requires otherwise, references to “Telesat,” “Company,” “we,” “our” and “us” refer to Telesat Corporation and its subsidiaries.    Unless the context states or requires otherwise, reference herein to “the consolidated financial statements” or “the financial statements” or similar terms refer to Telesat Corporation’s unaudited interim condensed consolidated financial statements included herein.

All figures reported in this MD&A are in Canadian dollars, except where we indicate otherwise, and are referenced as “$” and “dollars”.

This MD&A contains a translation of some Canadian dollar amounts into United States dollars at specified exchange rates solely for your convenience. All references to “US$” and “U.S. dollar” refer to United States dollars.

The financial statements presented herein have been prepared in accordance with International Accounting Standards 34, Interim Financial Reporting.

Certain totals, subtotals and percentages may not reconcile due to rounding.

The information contained in this MD&A takes into account information available up to May 5, 2025, unless otherwise noted.

This MD&A makes reference to certain non-IFRS Accounting Standards measures, namely, Adjusted EBITDA, Adjusted EBITDA margin and Consolidated EBITDA. These measures are not recognized measures under IFRS® Accounting Standards and do not have a standardized meaning prescribed by IFRS Accounting Standards and are therefore unlikely to be comparable to similar measures presented by other companies. Accordingly, these measures should not be considered in isolation nor as a substitute for analysis of our financial information reported under IFRS Accounting Standards. Rather, these non-IFRS Accounting Standards measures are used to provide investors with supplemental measures of our operating performance and thus highlight trends in our core business that may not otherwise be apparent when relying solely on IFRS Accounting Standards measures. We also believe that securities analysts, investors and other interested parties frequently use non-IFRS Accounting Standards measures in the evaluation of issuers. Our management also uses non-IFRS Accounting Standards measures in order to facilitate operating performance comparisons from period to period, to prepare annual operating budgets and forecasts and to determine components of management compensation. For a reconciliation of the non-IFRS Accounting Standards measure to the most closely comparable IFRS Accounting Standards measure, see below under the heading “Non-IFRS Accounting Standards Measures”.

FORWARD LOOKING STATEMENTS

This MD&A contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. When used in this MD&A, the words “believes,” “expects,” “plans,” “may,” “will,” “would,” “could,” “should,” “anticipates,” “estimates,” “project,” “intend” or “outlook” or other variations of these words or other similar expressions are intended to identify forward-looking statements and information. In addition, Telesat or its representatives have made or may make forward-looking statements, orally or in writing, which may be included in, but are not limited to, various filings made from time to time with the U.S. Securities and Exchange Commission (“SEC”) and Canadian securities regulatory authorities, and press releases or oral statements made with the approval of an authorized executive officer of Telesat. Statements containing forward-looking information are not historical facts nor assurances of future performance but instead represent management’s expectations, estimates and projections regarding future events or circumstances.

These forward-looking statements and other forward-looking information are based on our opinions, estimates and assumptions in light of our experience and perception of historical trends, current conditions and expected future developments, as well as other factors that we currently believe are appropriate and reasonable in the circumstances. Actual results may differ materially from anticipated results as a result of certain risks and uncertainties described. The results are not limited to the risks listed below and, in the section, entitled “Risk Factors” included in

28

Telesat Corporation’s Annual Report on Form 20-F for the year ended December 31, 2024 (the “Annual Report”) which were filed with the SEC and the Canadian securities regulatory authorities on March 27, 2025. The Annual Report can be obtained on the SEC’s website at https://www.sec.gov and the System for Electronic Document Analysis and Retrieval (“SEDAR+”) at https://www.sedarplus.ca. There may be additional risks of which we are not presently aware or that we currently believe are immaterial which could have an adverse impact on our business. We make no commitment to revise or update any forward-looking statements in order to reflect events or circumstances that may change, except where we are expressly required to do so by law.

Factors that could cause actual results to differ from those projected include, but are not limited to (1) risks associated with financial factors, including swings in the global financial markets, tariffs, increases in interest rates, fluctuations in foreign exchange rates, and access to capital; (2) risks associated with satellite services, including dependence on large customers, launch delays and failures, in-orbit failures and competition; (3) risks and uncertainties associated with Telesat Lightspeed, including overcoming technological challenges, access to spectrum and markets, governmental restrictions or regulations, the impact of inflation on development costs and financing, raising sufficient capital to design and implement the system and competition from other low earth orbit systems; (4) regulatory risks, such as the effect of industry and government regulations that affect Telesat; and (5) other risks. The foregoing list of important factors is not exclusive. Furthermore, Telesat operates in an industry sector where securities values may be volatile and may be influenced by economic and other factors beyond Telesat’s control.

These factors should not be construed as exhaustive and should be read with the other cautionary statements in this MD&A. These forward-looking statements are based on our current expectations, estimates, forecasts and projections about our business and the industry in which we operate and management’s beliefs and assumptions, and are not guarantees of future performance or development and involve known and unknown risks, uncertainties and other factors that are in some cases beyond our control. As a result, any or all of our forward-looking statements in this MD&A may turn out to be inaccurate.

Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless specifically expressed as such, and should only be viewed as historical data. These forward-looking statements speak only as at the date of this MD&A. Except as required by law, we assume no obligation to update or revise these forward-looking statements for any reason, even if new information becomes available in the future. You should, however, review the factors and risks we describe in the reports we will file from time to time with the SEC and the Canadian securities regulatory authorities, after the date of this MD&A.

This MD&A contains estimates, projections, market research and other information concerning our industry, our business, and the markets for our services. Information that is based on estimates, forecasts, projections, market research or similar methodologies is inherently subject to uncertainties, and actual events or circumstances may differ materially from events and circumstances that are assumed in this information.

Unless otherwise expressly stated, we obtained this industry, business, market and other data from our own internal estimates and research as well as from reports, research surveys, studies and similar data prepared by market research firms and other third parties, industry and general publications, government data and similar sources.

In addition, assumptions and estimates of our and our industry’s future performance are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described in the section of our Annual Report entitled “Risk Factors.” These and other factors could cause our future performance to differ materially from our assumptions and estimates.

Any references to forward-looking statements in this MD&A include forward-looking information within the meaning of applicable Canadian securities laws.

Additional information regarding the Company, including the Annual Report, can be obtained on the SEC’s website at https://www.sec.gov and on SEDAR+ at https://www.sedarplus.ca.

29

OPERATING HIGHLIGHTS

Telesat Lightspeed Secures Key Multi-Year Agreements

Viasat Inc.

In April 2025, Telesat LEO Inc. signed a multi-year agreement with Viasat Inc. for Telesat Lightspeed services. Under their multi-orbit strategy, Viasat plans to integrate Telesat Lightspeed into their services portfolio for aviation, maritime, enterprise and defense markets.

Viasat is well positioned as the largest broadband connectivity provider in the commercial aviation market. The thousands of airplanes that have the Viasat GM-40 antenna installed today will be able to access the Telesat Lightspeed network when global services commence. Viasat and its airline customers also will be able to install next-generation electronically steerable antennas (ESAs) to access the advanced Telesat Lightspeed constellation.

Telesat Lightspeed enables enhanced inflight connectivity by delivering high-speed, low-latency broadband globally, as well as to hotspots such as large airport hubs, all backed by enterprise-grade Service Level Agreements (SLAs) for guaranteed performance.

Orange

In March 2025, Telesat LEO Inc. entered into multi-year agreements with Orange for Telesat Lightspeed satellite connectivity and terrestrial infrastructure.

Under the terrestrial infrastructure agreement, a Telesat Lightspeed Landing Station will be hosted at Orange’s teleport in Bercenay-en-Othe, France, and benefit from ground segment connectivity with their point of presence located in Paris over Orange Wholesale International Private Line. Additionally, Orange signed a capacity commitment for Telesat Lightspeed service, which will be integrated into its global portfolio of services for businesses and telecom operators.

Space Norway

In March 2025, Telesat LEO Inc. signed a Term Sheet with Space Norway for Telesat Lightspeed connectivity services.

Space Norway plans to integrate a multi-Gbps Telesat Lightspeed capacity pool into its services portfolio to provide secure, low-latency connectivity services for its defense, enterprise, maritime and land customers. The capacity pool, backed by Committed Information Rates and a Service Level Agreement, will deliver significant flexibility for Space Norway to tailor its service offerings. This includes prioritization of services and data rates to each remote site, and seamless modification of online services via Space Norway’s own infrastructure.

We expect to conclude definitive agreements in the second half of 2025.

ADN Telecom Limited

In March 2025, Telesat LEO Inc. announced a multi-year partnership with ADN Telecom Limited (“ADN Telecom”) to deliver Telesat Lightspeed connectivity solutions across Bangladesh and South Asia.

Through this partnership, Telesat Leo Inc. will provide Telesat Lightspeed services and a Smart Virtual Network Operator capability for ADN Telecom to manage and deliver innovative, customized connectivity solutions for their enterprise, maritime and government customers. ADN Telecom will participate in early field trial testing of Telesat Lightspeed services and commence full-time services with industry-leading committed information rates and guaranteed SLAs.

30

OVERVIEW OF THE BUSINESS

We are a leading global satellite services operator, providing our customers with mission-critical communications services since the start of the satellite communications industry in the 1960s. Through a combination of advanced satellites and ground facilities and a highly expert and dedicated staff, our communications solutions support the requirements of sophisticated satellite users throughout the world. We are organized into two operating segments: low earth orbit (“LEO”) and geostationary orbit (“GEO”) and other. We provide our services through three business categories: Broadcast, Enterprise and Consulting and other.

The satellite services business is capital intensive and the build-out of a satellite fleet requires substantial time and investment. Once the investment in a satellite is made, the incremental costs to maintain and operate the satellite are relatively low over the life of the satellite, with the exception of in-orbit insurance.

As at March 31, 2025, we provided satellite services to customers from our fleet of 14 in-orbit GEO satellites, as well as our Canadian payload on the ViaSat-1 satellite. We also manage the operations of additional satellites for third parties.

We are building what we believe will be one of the world’s most advanced constellations of LEO satellites and integrated terrestrial infrastructure, called “Telesat Lightspeed” — a platform designed to revolutionize the provision of global broadband connectivity. In January 2018, our first LEO satellite, LEO 1, was successfully launched into orbit. The LEO 1 satellite demonstrated certain key features of the Telesat Lightspeed system design, specifically the capability of the satellite and customer terminals to deliver a low latency broadband experience. In July 2023, we successfully launched our LEO 3 satellite into orbit, and it has since replaced LEO 1. We also deployed ground infrastructure to support testing with a variety of existing and prospective customers and potential suppliers of the Telesat Lightspeed system hardware.

In September 2024, Telesat LEO Inc. (“Telesat LEO”) completed financing agreements with the Government of Canada (“GoC”) and Government of Quebec (“GoQ”) for loans of $2.14 billion and $400 million, respectively, for the Telesat Lightspeed constellation (“Telesat Lightspeed Financing”). See “— Debt — Telesat Lightspeed Financing — Senior Secured Term Loan Facilities”, below.

Telesat and its affiliates operate satellites pursuant to authorizations granted by governments, including those of Canada, the United States, Brazil, the Kingdom of Tonga and the United Kingdom, to access and use certain geostationary orbital locations and associated spectrum resources. The use of these orbital locations, as well as our other operations, is subject to a variety of Canadian and international regulations.

Revenue

We earn most of our revenue by providing video and data services using satellite transponder capacity. We also earn revenue by providing ground-based transmit and receive services, selling equipment, managing satellite networks, and providing consulting services in the field of satellite communications.

We recognize revenue from satellite services on a monthly basis as services are performed in an amount that reflects the consideration we expect to receive in exchange for those services. We account for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability is considered probable.

Consulting revenue for cost plus contracts is recognized as the approved time and labor is completed by Telesat. We recognize consulting revenue for fixed price contracts using the input method to determine the progress towards complete satisfaction of the performance obligation. Equipment sale revenue is recognized when the customer obtains control of the equipment, being at the time the equipment is delivered to and accepted by the customer.

Expenses

Our operating expenses consist of labor and variable operating expenses which include in-orbit insurance and direct-billed expenses, such as third-party contractor services. As we further our Lightspeed development, we anticipate that our labor costs will continue to increase.

31

Interest expense is significant and arises principally from our: Senior Secured Credit Facilities comprised of two outstanding secured credit facilities, which include a revolving facility that matured in 2024 and Term Loan B (“U.S. TLB Facility”) maturing in 2026 (together, the “Senior Secured Credit Facilities”); 6.5% senior unsecured notes due in 2027 issued by Telesat Canada and Telesat LLC, as the co-issuer (the “Senior Unsecured Notes”); 4.875% senior secured notes due in 2027 issued by Telesat Canada and Telesat LLC, as the co-issuer (the “Senior Secured Notes”); and 5.625% senior secured notes due in 2026 issued by Telesat Canada and Telesat LLC, as the co-issuer (the “2026 Senior Secured Notes”). The Senior Secured Credit Facilities, Senior Unsecured Notes, Senior Secured Notes and 2026 Senior Secured Notes are collectively known as “Telesat Canada Debt”.

We also expect to incur to significant interest on the Telesat Lightspeed Financing, which we expect to be capitalized against the costs of the constellation until the constellation is in service.

Other significant operating expenses include the straight-line depreciation of the cost of each of our satellites over their useful lives and amortization expense related to various finite-life intangible assets.

FUTURE OUTLOOK

Our desirable spectrum rights, commitment to providing the highest level of customer service, deep technical expertise and culture of innovation have enabled us to successfully develop our business to date. Leveraging these strengths and building on our existing contractual backlog, our focus is on profitably growing our business by increasing the utilization of our in-orbit satellites and, in a disciplined manner, deploying expansion satellite capacity where we anticipate there will be strong market demand.

After decades of developing and successfully operating our GEO satellite services business, we are now poised to revolutionize the provision of global broadband connectivity by building what we believe will be one the of world’s most advanced constellations of LEO satellites and integrated terrestrial infrastructure, Telesat Lightspeed.

We believe we are well-positioned to serve our customers and the markets in which we participate. Although we pursue opportunities to develop new satellites, we do not procure additional or replacement satellites until we believe there is a demonstrated need and a sound business plan for such satellite capacity.

As we move through 2025, we remain focused on increasing the utilization of our existing satellites, the deployment of our global Telesat Lightspeed constellation, and identifying and pursuing opportunities to invest in expansion satellite capacity all while maintaining our operating discipline.

RESULTS OF OPERATIONS

Review of financial performance

Telesat Corporation’s net loss for the three months ended March 31, 2025, was $51.5 million compared to net loss of $52.3 million for the same period in the prior year. The $0.9 million decrease was primarily due the positive variation of the foreign exchange. This was partially offset by a decrease in revenues combined with a loss on the changes in the fair value of the derivative liabilities associated with the warrants issued in conjunction with the Telesat Lightspeed Financing.

Below are the foreign exchange rates used for our interim condensed consolidated financial statements and this MD&A:

Q1 <br>2025 March 31, <br>2025 December 31, <br>2024
US$ to $ spot rate — 1.4387 1.4384
US$ to $ average rate 1.4344 — —
Q1 <br>2024 March 31, <br>2024 December 31,<br> 2023
--- --- --- ---
US$ to $ spot rate — 1.3540 1.3243
US$ to $ average rate 1.3483 — —

32

Revenue

($ millions except percentages) Three months ended <br>March 31, % Increase <br>(Decrease)
2025 2024
Broadcast $ 55.1 $ 72.5 (24.1 )%
Enterprise 56.8 72.8 (22.0 )%
Consulting and other 4.9 6.8 (28.9 )%
Revenue $ 116.7 $ 152.2 (23.3 )%

Total revenue for the three months ended March 31, 2025, decreased by $35.4 million to $116.7 million, when compared to the same period in the prior year.

Revenue from Broadcast services decreased by $17.5 million for the three months ended March 31, 2025, when compared to the same period in the prior year. This decrease in GEO revenue was mainly due to a lower rate on the renewal of a long-term agreement with a North American direct-to-home customer.

Revenue from Enterprise services decreased by $16.0 million for the three months ended March 31, 2025, when compared to the same period in the prior year. This decrease in GEO revenue was due to reductions of services to certain customers, in particular with an agreement to provide services for an Indonesian rural broadband program, combined with lower equipment sales to Canadian government customers.

Consulting and other revenue decreased by $2.0 million for the three months ended March 31, 2025, when compared to the same period in the prior year. The decrease was primarily due to lower LEO consulting services provided to NASA Goddard Space Flight Center.

Expenses

($ millions except percentages) Three months ended <br>March 31, % Increase <br>(Decrease)
2025 2024
Depreciation $ 25.9 $ 36.4 (28.8 )%
Amortization 10.9 2.8 286.1 %
Other operating (gains) losses, net (4.0 ) — 100.0 %
Operating expenses 53.0 47.1 12.6 %
Total expenses $ 85.9 $ 86.3 (0.5 )%

Depreciation

Depreciation of satellites, property and other equipment decreased by $10.5 million for the three-month period ended March 31, 2025, when compared to the same period in the prior year. The decrease in depreciation was primarily due to the end of useful lives, for accounting purposes, of our Telstar 11N satellite in March 2024 and Nimiq 5 satellite in September 2024.

Amortization

Amortization of intangible assets increased by $8.1 million for the three-month period ended March 31, 2025, when compared to the same period in the prior year. The increase was primarily related to the amortization of orbital slots, which were transferred from indefinite life assets to finite life assets effective January 1, 2025.

33

Operating Expenses

($ millions except percentages) Three months ended <br>March 31, % Increase <br>(Decrease)
2025 2024
Compensation and employee benefits $ 26.1 $ 25.3 3.1 %
Other operating expenses 20.3 11.1 82.1 %
Cost of sales 6.7 10.7 (37.2 )%
Operating expenses $ 53.0 $ 47.1 12.6 %

Total operating expenses increased by $5.9 million for the three-month period ended March 31, 2025, when compared to the same period in the prior year.

Compensation and employee benefits increased by $0.8 million for the three-month period ended March 31, 2025, in comparison to the same period in the prior year. The increase was primarily due to higher wages and benefits related to Telesat Lightspeed and higher bonuses, which were partially offset by higher capitalized engineering related to LEO and lower share-based compensation.

Other operating expenses increased by $9.1 million for the three-month period ended March 31, 2025, in comparison to the same period in the prior year. The increase was primarily due to higher GEO legal and professional fees and to an increase in software licensing costs associated with LEO.

Cost of sales decreased by $4.0 million for the three-month period ended March 31, 2025, when compared to the same period in the prior year. The decrease was primarily due to lower consulting costs tied to lower LEO consulting revenue from NASA Goddard Space Flight Center combined with lower GEO equipment sales to the Canadian Government.

Interest Expense

($ millions except percentages) Three months ended<br>March 31, % Increase <br>(Decrease)
2025 2024
Debt service costs $ 56.5 $ 60.2 (6.2 )%
Interest on significant financing component 3.3 3.6 (9.4 )%
Interest on satellite performance incentive payments 0.3 0.3 (18.4 )%
Interest on employee benefit plans (0.3 ) — (562.5 )%
Interest on leases 0.4 0.4 20.5 %
Capitalized interest (3.5 ) — (100.0 )%
Interest expense $ 56.7 $ 64.4 (12.1 )%

Interest expense included interest related to our debt, as well as interest related to our derivative instruments, significant financing components on certain revenue agreements, satellite performance incentive payments, employee benefit plans and leases.

Debt service costs, which included interest expense on indebtedness and derivative instruments, decreased by $3.7 million for the three months ended March 31, 2025, when compared to the same period in the prior year. The decrease in interest expense was primarily due to the impact of the repurchases of a portion of the U.S. TLB Facility, Senior Unsecured Notes, Senior Secured Notes, and 2026 Senior Secured Notes, as well as a decrease in interest rates on the U.S. TLB Facility. This decrease was partially offset by the interest expense on the Telesat Lightspeed Financing under which draws occurred in 2025.

Interest on significant financing component decreased by $0.3 million for the three months ended March 31, 2025, when compared to the same period in the prior year. The decrease in interest expense was primarily due to lower average prepayment balances for revenue agreements with a significant financing component.

Interest on satellite performance incentive payments decreased by $0.1 million for the three months ended March 31, 2025, when compared to the same period in the prior year.

34

Interest on employee benefit plans decreased by $0.2 million for the three months ended March 31, 2025, when compared to the same period in the prior year.

Interest on leases increased by $0.1 million for the three months ended March 31, 2025, when compared to the same period in the prior year.

Capitalized interest increased by $3.5 million for the three months ended March 31, 2025, when compared to the same period in the prior year. Balances relate to interest capitalized to the Lightspeed constellation tied to Telesat Lightspeed Financing.

Interest and Other Income

($ millions) Three months ended <br>March 31,
2025 2024
Interest and other income $ 6.2 $ 21.1

Interest and other income decreased by $14.9 million for the three-month period ended March 31, 2025, when compared to the same period in the prior year. The decrease was primarily due to lower average cash and cash equivalent balances.

Foreign Exchange & Derivatives

($ millions) Three months ended <br>March 31,
2025 2024
Gain (loss) on changes in fair value of financial instruments $ (33.4 ) $ —
Gain (loss) on foreign exchange $ 2.5 $ (68.4 )

The loss on changes in fair value of financial instruments for the three months ended March 31, 2025 was $33.4 million. The loss on changes in fair value of financial instruments was due to the change in fair value of the derivative liabilities associated with the warrants issued in conjunction with the Telesat Lightspeed Financing. There was no gain (loss) on changes in fair value of financial instruments for the three months ended March 31, 2024.

The foreign exchange gain for the three months ended March 31, 2025, was $2.5 million compared to a foreign exchange loss of $68.4 million for the same period in the prior year, resulting in a positive change of $70.9 million.

The gain for the three months ended March 31, 2025, was mainly the result of the variation of the U.S. dollar to Canadian dollar spot rate as at March 31, 2025 ($1.4387), compared to the spot rate as at December 31, 2024 ($1.4384), and the resulting impact on the translation of our U.S. dollar and Canadian dollar denominated indebtedness and our Canadian dollar derivative warrant liabilities.

The loss for the three months ended March 31, 2024, was mainly the result of a stronger U.S. dollar to Canadian dollar spot rate as at March 31, 2024 ($1.3540), compared to the spot rate as at December 31, 2023 ($1.3243), and the resulting unfavorable impact on the translation of our U.S. dollar denominated indebtedness.

Income Taxes

($ millions) Three months ended <br>March 31,
2025 2024
Current tax expense $ 2.4 $ 7.9
Deferred tax recovery (1.5 ) (1.5 )
Tax expense (recovery) $ 0.9 $ 6.5

The tax expense (recovery) for the three months ended March 31, 2025, was $5.6 million lower than the same period in the prior year. The decrease was primarily due to a decrease in operating income.

35

Backlog

Our backlog represents future cash inflows from capacity allocation or service delivery contracts. As of March 31, 2025, GEO backlog was $1.0 billion and represents our expected future revenue from existing GEO service contracts (without discounting for present value) including any deferred revenue that we will recognize in the future in respect of cash already received. As of the date of this filing, the expected cash inflows from Telesat Lightspeed capacity allocation and service contracts (without discounting for present value) was $1.1 billion.

Generally, following the successful launch of a satellite, if the satellite is operating nominally, our customers may only terminate their service agreements for satellite capacity by paying us all, or substantially all, of the payments that would have otherwise become due over the term of the service agreement. However, if certain of our existing satellites were to experience an in-orbit failure, or otherwise fail to operate as anticipated, our customers may be entitled to terminate their agreement, and we may be obligated to return all or a portion of the customer prepayments made under service agreements for that satellite and reduce the associated backlog. Any repayments under such conditions would be funded by insurance proceeds we may receive, cash on hand and short-term investments.

We expect our GEO backlog as at March 31, 2025 to be recognized as follows:

($ millions) Remaining <br>2025 2026 2027 2028 2029 Thereafter
Backlog $ 275.0 $ 234.4 $ 159.5 $ 93.6 $ 73.5 $ 168.3

LIQUIDITY AND CAPITAL RESOURCES

Cash and Available Credit

As at March 31, 2025, we had $797.4 million of cash and short-term investments, including $549.1 million held in unrestricted subsidiaries. To finance the LEO constellation, we also have in aggregate $2.2 billion of Telesat Lightspeed Financing available to draw, subject to certain conditions. As at March 31, 2025, we have drawn $340 million against the Telesat Lightspeed Financing.

Cash Flows from Operating Activities

Cash flows from operating activities for the three months ended March 31, 2025, was $138.9 million, a $62.3 million increase compared to the same period in the prior year. The increase was primarily due to the collection of certain other receivables outstanding from December 2024, partially offset by the decline in revenue.

Cash Flows (used in) generated from Investing Activities

Cash used in investing activities for the three months ended March 31, 2025 was $230.6 million. This consisted primarily of payments associated with the Telesat Lightspeed constellation.

Cash used in investing activities for the three months ended March 31, 2024 was $19.9 million. This consisted primarily of payments associated with the Telesat Lightspeed constellation.

Cash Flows (used in) generated from Financing Activities

Cash flows from financing activities for the three months ended March 31, 2025 was $332.5 million. This was primarily due to drawings under the Telesat Lightspeed Financing.

Cash used in financing activities for the three months ended March 31, 2024 was $3.5 million. This was primarily due to tax withholdings on the settlement of restricted share units.

36

Government Grant

In 2019, we entered into an agreement with the GoC pursuant to which the GoC would contribute up to $85.0 million to support the development of the Telesat Lightspeed constellation through the GoC Strategic Innovation Fund. In return for the grant, Telesat has made a number of commitments to the GoC, including commitments to conduct over $200.0 million of research and development activities in Canada as well as to expand its Canadian workforce.

The costs that were incurred in connection with this program are summarized below:

($ millions) Three months <br>ended <br>March 31, <br>2025 Year ended <br>December 31, <br>2024
Satellites, property and other equipment $ 178.1 $ 1,088.4
Operating expenses 18.2 77.4
Total costs incurred $ 196.3 $ 1,165.8

Total research and development costs for Telesat Lightspeed for the three months ended March 31, 2025 increased by $154.5 million from $41.8 million to $196.3 million, when compared to the same period in the prior year.

The variation was primarily driven by an increase in activity in the Telesat Lightspeed program.

The following claims against the government grant have been made against the costs incurred associated with the program:

($ millions) Three months <br>ended <br>March 31, <br>2025 Year ended <br>December 31, <br>2024
Satellites, property and other equipment $ — $ 5.4
Operating expenses — 8.0
Total claims $ — $ 13.4

Liquidity

A large portion of our annual cash receipts are reasonably predictable because they are primarily derived from an existing backlog of long-term customer contracts. We believe cash and short-term investments as at March 31, 2025 and cash flows from operating activities will be adequate to meet our expected cash requirements for at least the next twelve months for activities in the normal course of business, including required interest and principal payments on our indebtedness and our capital requirements for our GEO business. Similarly, we believe our existing cash, cash flows from operating activities and drawings on our Telesat Lightspeed Financing will be adequate to cover the cost of the ongoing construction and global service deployment of the Telesat Lightspeed constellation for our LEO business.

We have from time to time used available cash to repurchase some of our existing debt. We may from time to time continue to seek to repay, repurchase, exchange, refinance or otherwise retire our existing debt in open market transactions, privately negotiated transactions, tender offers, exchange offers, pursuant to the term of debt or otherwise. We may also incur additional debt to fund such transactions or exchange existing debt for newly issued debt obligations or equity or equity-like securities. Such transactions, if any, will depend on prevailing market conditions, trading prices of debt from time to time, our liquidity requirements and cash position, contractual restrictions and other factors. The amount involved in any such transactions, individually or in the aggregate, may be material. We cannot provide any assurance as to if or when we will consummate any such transactions or the terms of any such transactions.

The construction of any satellite replacement or expansion program, including expansion of the Telesat Lightspeed constellation, will require significant capital expenditures. Cash required for any future satellite programs may be funded from a range of sources including: cash and short-term investments, cash flows generated from operating activities, cash flows from customer prepayments, export credit agency financing, vendor financing, equity investments, including through the issuance of public equity, additional secured or unsecured debt financing, and government sources. We may also raise additional funding for expansion of the Telesat Lightspeed constellation through the issuance of additional equity of, or debt at, our unrestricted subsidiaries which own, and will operate and commercialize, the Telesat Lightspeed constellation.

37

We may sell certain satellite assets and, in accordance with the terms and conditions of the Senior Secured Credit Facilities, reinvest the proceeds in replacement satellites or pay down indebtedness under the Senior Secured Credit Facilities. However, our ability to access these sources of funding is not guaranteed, and therefore, we may not be able to fully fund additional replacement or new satellite programs.

We are building our planned Telesat Lightspeed constellation in unrestricted subsidiaries (as defined in the credit agreement governing our Senior Secured Credit Facilities (the “Credit Agreement”) and indentures governing the Senior Unsecured Notes, Senior Secured Notes and 2026 Senior Secured Notes (together, the “Indentures”)), and intend to complete the deployment of and operate our Telesat Lightspeed constellation through current or future unrestricted subsidiaries.

Debt

Senior Secured Credit Facilities

The obligations under the Credit Agreement and the guarantees of those obligations are secured, subject to certain exceptions, by a first priority security interest in the assets of Telesat Canada and certain of our subsidiaries (“Guarantors”). The Credit Agreement contains covenants that restrict the ability of Telesat Canada and the Guarantors to take specified actions, including, among other things and subject to certain significant exceptions: creating liens, incurring indebtedness, making investments, engaging in mergers, selling property, paying dividends, entering into sale-leaseback transactions, creating subsidiaries, repaying subordinated debt or amending organizational documents. The Credit Agreement contains customary events of default and affirmative covenants, including an excess cash sweep, that may require us to repay a portion of the outstanding principal under our Senior Secured Credit Facilities prior to the stated maturity.

As of March 31, 2025, our Senior Secured Credit Facilities is comprised of the following facility:

Term Loan B — U.S. Facility

Telesat Canada’s Term Loan B — U.S. Facility is a US$1,908.5 million facility maturing in December 2026. As at March 31, 2025, the outstanding balance was US$1,320.5 million.

Effective May 9, 2023, Telesat Canada entered into the Amendment to the Credit Agreement. The Amendment amends the Credit Agreement to replace LIBOR-based benchmark rates with SOFR-based benchmark rates and to make certain other conforming changes. Following the Amendment, loans under the Term Loan B Facility bear interest, at Telesat Canada’s option, at either (i) a floating rate based on the base rate, plus an applicable margin of 1.75% or (ii) a floating rate based on SOFR, plus an applicable margin of 2.75%. In addition, loans benchmarked against SOFR will be subject to a credit spread adjustment of 0.11448% for a one-month interest period, 0.26161% for a three-month interest period and 0.42826% for a six-month interest period.

The mandatory principal repayments on our U.S. TLB Facility are one quarter of 1.00% of the value of the loan, which must be paid on the last day of each quarter. There are currently no mandatory quarterly principal repayments required.

Senior Secured Notes

Telesat Canada’s Senior Secured Notes, in the amount of US$400.0 million, bear interest at an annual rate of 4.875% and are due in September 2027.

As at March 31, 2025, the balance outstanding was US$225.0 million. The indenture governing the Senior Secured Notes includes covenants or terms that restrict our ability to, among other things, incur additional indebtedness, incur liens, pay dividends or make certain other restricted payments, investments or acquisitions, enter into certain transactions with affiliates, modify or cancel our satellite insurance and effect mergers with another entity, in each case subject to exceptions provided in the Senior Secured Notes indenture.

2026 Senior Secured Notes

In April 2021, Telesat Canada issued US$500.0 million in aggregate principal amount of 2026 Senior Secured Notes which bear interest at an annual rate of 5.625% and are due in December 2026.

38

As at March 31, 2025, the balance outstanding was US$387.0 million. The indenture governing the 2026 Senior Secured Notes includes covenants and terms that restrict our ability to, among other things, incur additional indebtedness, incur liens, pay dividends or make certain other restricted payments, investments or acquisitions, enter into certain transactions with affiliates, modify or cancel its satellite insurance, and effect mergers with another entity, in each case subject to exceptions provided in such indenture.

Senior Unsecured Notes

Telesat Canada’s Senior Unsecured Notes, in the original principal amount of US$550.0 million, bear interest at an annual rate of 6.5% and are due in October 2027.

As at March 31, 2025, the balance outstanding was US$221.3 million. The indenture governing the Senior Unsecured Notes includes covenants or terms that restrict our ability to, among other things, incur additional indebtedness, incur liens, pay dividends or make certain other restricted payments, investments or acquisitions, enter into certain transactions with affiliates, modify or cancel our satellite insurance and effect mergers with another entity, in each case subject to exceptions provided in the Senior Unsecured Notes indenture.

Telesat Lightspeed Financing — Senior Secured Term Loan Facilities

To fund our Lightspeed LEO constellation, on September 13, 2024, Telesat LEO Inc. (a wholly owned unrestricted subsidiary of Telesat) entered into the Telesat Lightspeed Financing with the GoC and GoQ for senior secured non-revolving delayed draw term loan facilities in the principal amount of $2,140 million and $400 million, respectively.

The Telesat Lightspeed Financing carries a floating interest rate of 4.75% above the 3-month term CORRA on the outstanding drawn loan amount with a 15-year maturity. All interest accrued on the Telesat Lightspeed Financing until six months after the initial project completion date (a date upon which a certain number of satellites under the LEO project have been launched, with a certain number of satellites made operational and certain other milestones under the agreement being met) shall be added to the principal amount.

Unless accelerated on the event of default as defined in the Telesat Lightspeed Financing, principal repayment of the loan is required on a semi-annual installment basis in 10 years commencing one year after initial project completion date subject to the mandatory repayment of the full amount by the 15th anniversary of the initial draw on the loan. The amount of each semi-annual installment will be calculated as a percentage of the total loan amount as prescribed in the loan agreement.

In addition to the regular repayment, we will also be required to make mandatory prepayment or repayment under certain circumstances including in cases when Telesat LEO has excess cash flow. The Telesat Lightspeed Financing also provides a full or partial prepayment option to Telesat LEO.

The Telesat Lightspeed Financing includes both financial and non-financial covenants with which we must comply.

As consideration for the Telesat Lightspeed Financing, Telesat LEO Inc., before the initial draw on the loan, on November 15, 2024, entered into an agreement with the GoC and the GoQ which irrevocably granted warrants equivalent to 11.87% of common shares in the capital of Telesat LEO Inc. on a fully diluted basis (“Telesat Lightspeed Financing Warrants”). The Telesat Lightspeed Financing Warrants are exercisable in whole or in part, at any time after the second anniversary of the date of their issuance and up to 10 years from the issuance date (subject to certain terms and conditions of the warrant agreement) based upon an equity valuation of US$3 billion for Telesat LEO Inc.

On initial recognition, the Telesat Lightspeed Financing Warrants were recorded against other current and long-term assets with the derivative recorded against other current and long-term financial liabilities. The initial fair value impact, as at November 15, 2024, of the Telesat Lightspeed Financing Warrants was $604.3 million. As the drawdowns are made against the Telesat Lightspeed Financing, the proportional amount of the current and long-term assets are transferred to the debt issue costs against the long-term indebtedness. These balances are amortized to the statement of income (loss) using the effective interest method. The carrying amount against the indebtedness as of March 31, 2025 was $82.2 million.

39

Debt issue costs of $37.5 million were incurred in connection with the Telesat Lightspeed Financing. These balances are recorded against prepaid expenses and other current assets and long-term assets. As the drawdowns are made against the Telesat Lightspeed Financing, the proportional amount of the prepaid expenses and other current assets and long-term assets are transferred to the debt issue costs against the long-term indebtedness. The liability is subsequently amortized using the effective interest method. The carrying amount against the indebtedness as of March 31, 2025 was $5.1 million.

For the derivatives recorded against the current and long-term financial liabilities, the balances are marked to market at each reporting date thereafter in the statement of income (loss) as part of the gain (loss) on changes in fair value of financial instruments.

The Telesat Lightspeed Financing is secured by substantially all of the assets in our Unrestricted Subsidiaries. As at November 15, 2024, all conditions precedent to drawdown of the loans under the Telesat Lightspeed Financing were met.

As at March 31, 2025, $343.0 million of the Telesat Lightspeed Financing was outstanding of which $289.0 million and $54.0 million was outstanding with the GoC and GoQ, respectively. The balance consists of $340.0 million of draws combined with $3.0 million of interest which was capitalized to the principal on the loan facility. The interest capitalized against the loan facility was split between $2.6 million and $0.4 million with the GoC and GoQ, respectively.

Covenant Compliance

As of the date hereof, we were in compliance with the financial covenants of our Telesat Canada Debt and the Telesat Lightspeed Financing.

Debt Service Cost

An estimate of the interest expense is based upon assumptions of foreign exchange rates, SOFR, CORRA and the applicable margins of our Senior Secured Credit Facilities. Our interest expense for the year ending December 31, 2025, is expected to be approximately $209.4 million. Our interest expense for the Telesat Lightspeed Financing is expected to be $36.7 million for the year ending December 31, 2025, which is anticipated to be capitalized against the assets under construction. The interest expense excludes the amortization of our deferred financing costs, prepayment options, warrants and loss on repayment.

Derivatives

We use, from time to time, interest rate and currency derivatives to manage our exposure to changes in interest rates and foreign exchange rates. As at March 31, 2025, there were no interest rate or currency derivatives that were outstanding.

We also have embedded derivatives, on certain of our Telesat Canada debt, that are accounted for separately at fair value. These embedded derivatives are related to the prepayment option on our Senior Unsecured Notes, the prepayment option on our Senior Secured Notes and the prepayment option on our 2026 Senior Secured Notes. As at March 31, 2025, the fair value of the embedded derivative related to the prepayment option on our Senior Unsecured Notes, Senior Secured Notes and 2026 Senior Secured Notes was $Nil.

In addition, we also have embedded derivatives associated with the Telesat Lightspeed Financing with the GoC and GoQ. As part of the Telesat Lightspeed Financing, Telesat LEO issued the Telesat Lightspeed Financing Warrants representing 11.87% of its total shares on a fully diluted basis, with standard anti-dilution adjustments.

At their inception on November 15, 2024, the fair value of the embedded derivatives with respect to the Telesat Lightspeed Financing Warrants was $604.3 million. As at March 31, 2025, the fair value of the embedded derivatives was $650.5 million.

The changes in the fair value of these embedded derivatives are recorded on our consolidated statements of income as a gain or loss on changes in fair value of financial instruments and are non-cash.

40

All derivative instruments are measured at fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants in the principal market under current market conditions at the measurement date. Where possible, fair values are based on the quoted market values in an active market. In the absence of an active market, we determine fair values based on prevailing market rates (bid and ask prices, as appropriate) for instruments with similar characteristics and risk profiles or internal or external valuation models, such as option pricing models or frameworks and discounted cash flow analysis, using observable market-based inputs.

These estimates are affected significantly by the assumptions for the amount and timing of estimated future cash flows and discount rates, which all reflect varying degrees of risk. Potential income taxes and other expenses that would be incurred on disposition of our derivative instruments are not reflected in the fair values. The fair values also include an adjustment related to the counterparty credit risk. As a result, the fair values are not necessarily the net amounts that would be realized if these instruments were actually settled.

MARKET RISK

Credit Risk Related to Financial Instruments

Financial instruments that potentially subject us to a concentration of credit risk consist of cash and short-term investments, accounts receivable, derivative assets and other assets. Cash and short-term investments are invested with high quality financial institutions and are governed by our corporate investment policy, which aims to reduce credit risk by restricting investments to high-grade, mainly U.S. dollar and Canadian dollar denominated investments. Credit checks are performed to minimize exposure to any one customer. We are exposed to credit risk if counterparties to our derivative instruments are unable to meet their obligations. It is expected that these counterparties will be able to meet their obligations as they are institutions with strong credit ratings, but we continue to periodically monitor their credit risk and credit exposure.

Foreign Exchange Risk

Our operating results are subject to fluctuations as a result of exchange rate variations to the extent that transactions are made in currencies other than Canadian dollars or in cases where transactions are in Canadian dollars where the functional currency is other than Canadian dollars. The most significant impact of variations in the exchange rate is on our U.S. dollar denominated indebtedness and cash and short-term investments combined with the Canadian dollar indebtedness and derivative liabilities held in a subsidiary with other than Canadian functional currency. In addition, a portion of our revenue and expenses, as well as the majority of our capital expenditures are denominated in U.S. dollars. As a result, the volatility of the U.S. currency, and in certain cases Canadian currency, exposes us to foreign exchange risks.

For the three-month period ended March 31, 2025, we recorded a mainly non-cash foreign exchange gain of approximately $2.5 million due to a stronger U.S. to Canadian dollar spot rate ($1.4387) compared to December 31, 2024 ($1.4384).

For the three-month period ended March 31, 2024, we recorded a mainly non-cash foreign exchange loss of approximately $68.4 million due to a stronger U.S. to Canadian dollar spot rate ($1.3540) compared to December 31, 2023 ($1.3243).

The approximate amount of our revenue and certain expenses denominated in U.S. dollars, as a percentage of their overall balance, is summarized in the table below:

Three months ended March 31, 2025 2024
Revenue 47.8 % 51.5 %
Operating expenses 46.8 % 46.1 %
Interest on our indebtedness 93.8 % 100.0 %

We use, from time to time, currency derivative instruments to hedge the foreign exchange risk on our U.S. dollar denominated indebtedness.

41

Our policy is that we do not use derivative instruments for speculative purposes. As at March 31, 2025, we have no forward currency contracts nor any currency derivative instruments.

A five percent increase (decrease) in the value of the U.S. dollar against the Canadian dollar would have (decreased) increased our net income (loss) as at March 31, 2025 by $138.7 million and increased (decreased) our other comprehensive income by $16.3 million. This would have also increased (decreased) our indebtedness by $154.9 million.

A five percent increase (decrease) in the value of the U.S. dollar against the Canadian dollar would have increased (decreased) our cash and cash equivalents by $23.5 million, increased (decreased) our net income (loss) by $4.8 million and increased (decreased) our other comprehensive income (loss) by $18.7 million as at and for the three months ended March 31, 2025.

A five percent increase (decrease) in the value of the U.S. dollar against the Canadian dollar would have increased (decreased) our revenue and certain expenses for the three months ended March 31, 2025, as summarized in the table below:

( millions)
Revenue $ 2.8
Operating expenses $ 1.2
Interest on our indebtedness $ 2.6

All values are in US Dollars.

The sensitivity analyses above assume that all other variables remain constant.

Through our Telesat Canada U.S. dollar denominated indebtedness, we are exposed to foreign exchange fluctuations. The following table contains our existing U.S. dollar denominated indebtedness balances at the beginning of each respective period, which are net of our scheduled debt repayments, and based on the foreign exchange rate as at March 31, 2025.

($ millions, beginning of period) Q2 2025 2026 2027 2028 2029
U.S. TLB Facility $ 1,899.8 $ 1,899.8 $ — $ — $ —
Senior Secured Notes 323.7 323.7 323.7 — —
2026 Senior Secured Notes 556.8 556.8 — — —
Senior Unsecured Notes 318.3 318.3 318.3 — —
U.S. dollar denominated debt balances $ 3,098.7 $ 3,098.7 $ 642.0 $ — $ —

Through our Telesat LEO Inc. Canadian dollar denominated indebtedness we are exposed to foreign exchange fluctuations, as Telesat LEO Inc. has a functional currency other than Canadian dollars. The following table contains our existing and anticipated drawings on the Canadian dollar denominated indebtedness balances at the beginning of each respective period, in subsidiaries who have a functional currency other than Canadian dollars. The balances are net of our scheduled debt repayments and anticipated future drawings.

($ millions, beginning of period) Q2 2025 2026 2027 2028 2029 Thereafter
Lightspeed Financing <br>Facilities $ 343.1 $ 1,126.7 $ 1,953.6 $ 2,852.3 $ 2,840.3 $ 2,544.4

Interest Rate Risk

We are exposed to interest rate risk on our cash and short-term investments and on our indebtedness, a portion of the indebtedness which includes a variable interest rate. Changes in the interest rates could impact the amount of interest that we receive or are required to pay.

We use, from time to time, interest rate swaps to hedge the interest rate risk related to our indebtedness.

Our policy is that we do not use derivative instruments for speculative purposes.

If the interest rates on our variable rate debt increased (decreased) by 0.25%, the result would be a decrease (increase) of $1.3 million to our net income (loss) for three months ended March 31, 2025, excluding any impact from interest which would be capitalized against the Lightspeed constellation.

42

As at March 31, 2025, through our U.S. TLB Facility and our Lightspeed Financing Facility we are exposed to interest rate fluctuations. The following table contains the balances at the beginning of each respective period, net of our scheduled repayments, and based on the foreign exchange rate as at March 31, 2025.

($ millions, beginning of <br>period) Q2 2025 2026 2027 2028 2029 Thereafter
U.S. TLB Facility $ 1,899.8 $ 1,899.8 $ 1,899.8 $ — $ — $ —
Lightspeed Financing Facility(1) 343.1 1,126.7 1,953.6 2,852.3 2,840.3 2,544.4
Debt balances exposed to interest rate fluctuation $ 2,242.9 $ 3,026.5 $ 3,853.4 $ 2,852.3 $ 2,840.3 $ 2,544.4

____________

(1)      The contractual cash flows for Telesat Lightspeed Financing include anticipated future drawings and mandatory repayments against the loan.

Guarantees

In the normal course of business, we enter into agreements that provide for indemnification and guarantees to counterparties in transactions involving sales of assets, sales of services, purchases and development of assets, securitization agreements and operating leases. The nature of almost all of these indemnifications prevents us from making a reasonable estimate of the maximum potential amount that we could be required to pay counterparties. As a result, we cannot determine how they could affect future liquidity, capital resources or our credit risk profile. We have not made any significant payments under these indemnifications in the past. For more information, see Note 22 of our unaudited interim condensed consolidated financial statements.

NON-IFRS ACCOUNTING STANDARDS MEASURES

Adjusted EBITDA

Adjusted EBITDA and Adjusted EBITDA margin are non-IFRS Accounting Standards measures. EBITDA is defined as “Earnings Before Interest, Taxes, Depreciation and Amortization.” Adjusted EBITDA is used by management to measure our financial performance. Adjusted EBITDA is defined as operating income (excluding certain operating expenses such as share-based compensation expenses and unusual and non-recurring items, including restructuring related expenses) before interest expense, taxes, depreciation and amortization. Adjusted EBITDA margin is used by management to measure our operating performance. Adjusted EBITDA margin is defined as the ratio of Adjusted EBITDA to revenue.

Adjusted EBITDA and Adjusted EBITDA margin are not standardized financial measures under IFRS Accounting Standards and might not be comparable to similar financial measures disclosed by other issuers. Adjusted EBITDA allows investors and us to compare our 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 investors and us to compare operating results exclusive of these items. Competitors in the satellite services industry have significantly different capital structures. We believe that the use of Adjusted EBITDA improves comparability of performance by excluding interest expense.

We believe that the use of Adjusted EBITDA and the Adjusted EBITDA margin along with IFRS Accounting Standards financial measures enhances the understanding of our operating results and is useful to investors and us in comparing performance with competitors, estimating enterprise value and making investment decisions. Adjusted EBITDA and Adjusted EBITDA margin as used here may not be the same as similarly titled measures reported by competitors. Adjusted EBITDA and Adjusted EBITDA margin should be used in conjunction with IFRS Accounting Standards financial measures and are not presented as a substitute for cash flows from operations as a measure of our liquidity or as a substitute for net income (loss) as an indicator of our operating performance.

43

The following table provides a quantitative reconciliation of net income to Adjusted EBITDA and Adjusted EBITDA margin, each of which are non-IFRS Accounting Standards measures.

Three months ended <br>March 31,
($ millions) 2025 2024
Net income (loss) $ (51.5 ) $ (52.3 )
Tax expense (recovery) 0.9 6.5
(Gain) loss on foreign exchange (2.5 ) 68.4
(Gain) loss on changes in fair value of financial instruments 33.4 —
Interest and other income (6.2 ) (21.1 )
Other operating (gain) loss (3.9 ) —
Interest expense 56.7 64.4
Depreciation 25.9 36.4
Amortization 10.9 2.8
Non-recurring compensation expenses(1) 0.5 0.2
Non-cash expense related to share-based compensation 3.2 5.4
Adjusted EBITDA $ 67.4 110.7
Revenue $ 116.7 $ 152.2
Adjusted EBITDA Margin 57.7 % 72.8 %

____________

(1)      Includes severance payments, special compensation and benefits for executives and employees.

Adjusted EBITDA for Telesat Corporation decreased by $43.3 million for the three-month period ended March 31, 2025, when compared to the same period in the prior year. The decrease was primarily due to a decrease in revenues, as discussed above.

Consolidated EBITDA for Covenant Purposes

Under the terms of the Credit Agreement for our Senior Secured Credit Facilities, we are required to comply with a senior secured leverage ratio maintenance covenant as well as with other financial ratio covenants that impact, among other items, our ability to incur debt and make dividend payments.

Our Credit Agreement limits, among other items, our ability to incur debt and make dividend payments if the total leverage ratio is above 4.50:1.00, with certain exceptions. We refer to this total leverage ratio as the Consolidated Total Debt for Covenant Purposes to Consolidated EBITDA for the purposes of our Senior Secured Credit Facilities.

In addition, there are restrictions of the incurrence of secured debt which is measured by a senior secured leverage ratio of 4.25:1.00, tested quarterly. We refer to this senior secured leverage ratio as the Consolidated Total Secured Debt to Consolidated EBITDA for Covenant Purposes ratio.

Our Consolidated Earnings Before Interest, Taxes, Depreciation and Amortization for Covenant Purposes is defined as net income (loss) for Telesat Canada and Restricted Subsidiaries plus interest expense, net of cash interest income earned on cash and cash equivalents, depreciation expense, amortization expense, extraordinary losses and unusual and non-recurring charges, non-cash charges, any expenses or charges incurred in connection with any issuance of debt, any impairment charges or asset write off, foreign withholding taxes paid or accrued and non-cash charges related to share-based compensation expense. Additional sums which may be added include projected cost savings from an acquisition and lost revenue which may have been earned by satellites that have been subject to an insured loss. Deductions which are made in calculating Consolidated EBITDA for Covenant Purposes include extraordinary, non-recurring gains and losses and non-cash gains and losses.

Further adjustments are made to account for income from Unrestricted Subsidiaries, and currency gains and losses (including non-cash gains or losses on derivative contracts). Unrestricted Subsidiaries are (a) any Subsidiary of Telesat that is formed or acquired after the closing date of the Credit Agreement, provided that such Subsidiary is designated as an Unrestricted Subsidiary, and (b) any Restricted Subsidiary subsequently re-designated as an Unrestricted Subsidiary.

44

Consolidated EBITDA for Covenant Purposes is not a presentation made in accordance with IFRS Accounting Standards, is not a measure of financial condition or profitability, and should not be considered as an alternative to (1) net income (loss) determined in accordance with IFRS Accounting Standards or (2) cash flows from operating activities determined in accordance with IFRS Accounting Standards. Additionally, Consolidated EBITDA for Covenant Purposes is not intended to be a measure of free cash flow for management’s discretionary use as it does not include certain cash requirements for such items as interest payments, tax payments and debt service requirements. We believe that the inclusion of Consolidated EBITDA for Covenant Purposes herein is appropriate to provide additional information concerning the calculation of the financial ratio maintenance covenant and other covenants on our Senior Secured Credit Facilities. Consolidated EBITDA for Covenant Purposes is a material component of these covenants. Non-compliance with the financial ratio maintenance covenant contained in our Senior Secured Credit Facilities could result in the requirement to immediately repay all amounts outstanding. This presentation of Consolidated EBITDA for Covenant Purposes is not comparable to other similarly titled measures of other companies because not all companies use identical calculations of EBITDA. We believe the disclosure of the calculation of Consolidated EBITDA for Covenant Purposes provides information that is useful to an investor’s understanding of our liquidity and financial flexibility.

The following is a reconciliation of net income (loss), which is an IFRS Accounting Standards measure of our operating results, to Consolidated EBITDA for Covenant Purposes, as defined in the Credit Agreement and the calculation of the ratio of Consolidated Total Secured Debt to Consolidated EBITDA for Covenant Purposes as defined in the Credit Agreement. The terms and related calculations are defined in the Credit Agreement, a copy of which is publicly available at https://www.sec.gov.

(in $ millions) Twelve months <br>ended <br>March 31, <br>2025
Net income (loss) $ (301.6 )
Impact of unrestricted subsidiaries 104.7
Consolidated income for Covenant Purposes (196.9 )
Plus:
Income taxes (Note 1) (25.3 )
Interest expense (Note 1) 213.4
Depreciation and amortization expense (Note 1) 133.8
Non-cash share-based compensation and pension expense (Note 1) 17.9
Impairment 267.0
Other 16.4
Decreased by:
Gain on repurchase of debt (202.5 )
Non-cash (gains) losses resulting from changes in foreign exchange rates (Note 1) 188.9
Consolidated EBITDA for Covenant Purposes $ 412.7

____________

Note 1: Some adjustments for covenant purposes excludes certain specific expenses as defined in the Credit Agreement. As a result, these items in the covenant calculation do not reconcile to the financial statement line items.

Consolidated Total Secured Debt and Consolidated Debt for Covenant Purposes

Consolidated Total Debt for Covenant Purposes and Consolidated Total Secured Debt for Covenant Purposes are non-IFRS Accounting Standards measures. We believe that the inclusion of Consolidated Total Debt for Covenant Purposes and Consolidated Total Secured Debt for Covenant Purposes herein are appropriate to provide additional information concerning the calculation of the financial ratio maintenance and other covenants under our Senior Secured Credit Facilities and provides information that is useful to an investor’s understanding of our compliance with these financial covenants.

45

The following is a reconciliation of our Consolidated Total Debt for Covenant Purposes and Consolidated Total Secured Debt for Covenant Purposes to Indebtedness:

(in $ millions) As at March 31, <br>2025
U.S. dollar denominated debt
Term Loan B U.S. Facility (US$) $ 1,320.5
Senior Unsecured Notes (US) 221.2
Senior Secured Notes (US) 225.0
2026 Senior Secured Notes (US) 387.0
2,153.7
Foreign exchange adjustment 944.8
Subtotal 3,098.5
Deferred financing costs and prepayment options (1.4 )
Indebtedness $ 3,097.1

All values are in US Dollars.

(in millions)
Indebtedness $ 3,097.1
Adjustments for covenant purposes:
Deferred financing costs and prepayment options 1.4
Add: lease liabilities 30.9
Consolidated Total Debt 3,129.5
Less: Cash and cash equivalents (max. US100 million) (143.9 )
Consolidated Total Debt for Covenant Purposes $ 2,985.7
Consolidated Total Debt $ 3,129.5
Less: Unsecured debt (Senior Unsecured Notes) (318.3 )
Consolidated Total Secured Debt 2,811.3
Less: Cash and cash equivalents (max. US100 million) (143.9 )
Consolidated Total Secured Debt for Covenant Purposes $ 2,667.4

All values are in US Dollars.

As at March 31, 2025, the Consolidated Total Debt for Covenant Purposes to Consolidated EBITDA ratio, for the purposes of our Senior Secured Credit Facilities was 7.24:1.00. The Consolidated Total Secured Debt to Consolidated EBITDA for Covenant Purposes ratio, for the purposes of our Senior Secured Credit Facilities, was 6.46:1.00.

The consolidated EBITDA for covenant purposes for the Senior Secured Credit Facilities for the twelve months ended March 31, 2024 was $556.2 million. Detailed information of the calculation is included in Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations in the Telesat Corporation Quarterly Report for the three-month period ended March 31, 2024 on Form 6-K furnished with the SEC on May 10, 2024, which can be obtained on the SEC website at https://www.sec.gov.

As at the date hereof, we are in compliance with our debt covenants.

46

Unaudited Interim Condensed Consolidating Financial Information

The unaudited interim condensed consolidating financial information reflects the investments, using the equity method of accounting, of Telesat in the Issuers, of the Issuers in their respective Guarantor and Non-Guarantor subsidiaries, and of the Guarantors in their Non-Guarantor subsidiaries.

Balances of Telesat Partnership are inclusive of balances associated with Telesat Partnership LP, Telesat CanHold Corporation, Telesat Can ULC, Loral Space & Communications Inc. and Loral Skynet Corporation.

Unaudited Interim Condensed Consolidating Statements of Income (Loss) For the three months ended March 31, 2025

(in thousands of dollars) Telesat <br>Corporation Telesat <br>Partnership Telesat <br>LLC Telesat <br>Canada Guarantor <br>subsidiaries Non- <br>guarantor <br>subsidiaries Adjustments Consolidated
Revenue $ — $ — $ — $ 92,131 $ 73,166 $ 1,734 $ (50,282 ) $ 116,749
Operating expenses (1,442 ) (227 ) — (73,905 ) (9,590 ) (18,160 ) 50,282 (53,042 )
Depreciation — — — (3,264 ) (21,748 ) (658 ) (239 ) (25,909 )
Amortization — — — (60 ) (8,934 ) (85 ) (1,820 ) (10,899 )
Other operating gains (losses), <br>net — — — 3,950 — — — 3,950
Operating income (loss) (1,442 ) (227 ) — 18,852 32,894 (17,169 ) (2,059 ) 30,849
Income (loss) from equity investments (48,008 ) (47,200 ) — (15,836 ) 214 — 110,830 —
Interest expense (28 ) (44 ) — (53,372 ) (4,094 ) (96 ) 970 (56,664 )
Interest and other income 11 48 — 2,316 582 4,147 (896 ) 6,208
Gain (loss) on changes in fair value of financial instruments — — — — — (33,412 ) — (33,412 )
Gain (loss) on foreign <br>exchange (5 ) 1 — (224 ) 196 2,512 — 2,480
Income (loss) before income <br>taxes (49,472 ) (47,422 ) — (48,264 ) 29,792 (44,018 ) 108,845 (50,539 )
Tax (expense) recovery — (586 ) — 1,064 (1,372 ) (24 ) — (918 )
Net income (loss) $ (49,472 ) $ (48,008 ) $ — $ (47,200 ) $ 28,420 $ (44,042 ) $ 108,845 $ (51,457 )

Unaudited Interim Condensed Consolidating Statements of Comprehensive Income (Loss) For the three months ended March 31, 2025

(in thousands of dollars) Telesat <br>Corporation Telesat <br>Partnership Telesat <br>LLC Telesat <br>Canada Guarantor <br>subsidiaries Non- <br>guarantor <br>subsidiaries Adjustments Consolidated
Net income (loss) $ (49,472 ) $ (48,008 ) $ — $ (47,200 ) $ 28,420 $ (44,042 ) $ 108,845 $ (51,457 )
Other comprehensive income (loss)
Items that may be reclassified into profit or loss
Foreign currency translation adjustments 1 (1 ) — 83 964 284 421 1,752
Other comprehensive income (loss) from equity investments 1,330 1,331 — 1,248 138 — (4,047 ) —
Other comprehensive income (loss) 1,331 1,330 — 1,331 1,102 284 (3,626 ) 1,752
Total comprehensive income (loss) $ (48,141 ) $ (46,678 ) $ — $ (45,869 ) $ 29,522 $ (43,758 ) $ 105,219 $ (49,705 )

47

Unaudited Interim Condensed Consolidating Statements of Income (Loss) For the three months ended March 31, 2024

(in thousands of dollars) Telesat <br>Corporation Telesat <br>Partnership Telesat <br>LLC Telesat <br>Canada Guarantor <br>subsidiaries Non- <br>guarantor <br>subsidiaries Adjustments Consolidated
Revenue $ — $ — $ — $ 131,864 $ 84,655 $ 4,755 $ (69,099 ) $ 152,175
Operating expenses (650 ) (289 ) — (83,992 ) (15,778 ) (15,502 ) 69,099 (47,112 )
Depreciation — — — (3,363 ) (31,725 ) (840 ) (467 ) (36,395 )
Amortization — — — (60 ) (660 ) (81 ) (2,022 ) (2,823 )
Other operating gains (losses), net — — — 15 — — — 15
Operating income (loss) (650 ) (289 ) — 44,464 36,492 (11,668 ) (2,489 ) 65,860
Income (loss) from equity investments (49,254 ) (47,639 ) — 35,153 347 — 61,393 —
Interest expense (27 ) (104 ) — (61,716 ) (3,269 ) (1 ) 687 (64,430 )
Interest and other income (expense) 8 42 — 3,275 1,937 16,472 (606 ) 21,128
Gain (loss) on foreign <br>exchange (6 ) 27 — (66,938 ) (60 ) (1,436 ) — (68,413 )
Income (loss) before income taxes (49,929 ) (47,963 ) — (45,762 ) 35,447 3,367 58,985 (45,855 )
Tax (expense) recovery — (1,291 ) — (1,877 ) (1,408 ) (1,906 ) — (6,482 )
Net income (loss) $ (49,929 ) $ (49,254 ) $ — $ (47,639 ) $ 34,039 $ 1,461 $ 58,985 $ (52,337 )

Unaudited Interim Condensed Consolidating Statements of Comprehensive Income (Loss) For the three months ended March 31, 2024

(in thousands of dollars) Telesat <br>Corporation Telesat <br>Partnership Telesat <br>LLC Telesat <br>Canada Guarantor <br>subsidiaries Non- <br>guarantor <br>subsidiaries Adjustments Consolidated
Net income (loss) $ (49,929 ) $ (49,254 ) $ — $ (47,639 ) $ 34,039 $ 1,461 $ 58,985 $ (52,337 )
Other comprehensive income (loss)
Items that may be reclassified into profit or loss
Foreign currency translation adjustments (148 ) 157 — 3,608 3,955 64,271 23,912 95,755
Other comprehensive income (loss) from equity investments 71,991 71,834 — 68,226 (32,658 ) — (179,393 ) —
Other comprehensive income (loss) 71,843 71,991 — 71,834 (28,703 ) 64,271 (155,481 ) 95,755
Total comprehensive income (loss) $ 21,914 $ 22,737 $ — $ 24,195 $ 5,336 $ 65,732 $ (96,496 ) $ 43,418

48

Unaudited Interim Condensed Consolidating Balance Sheets As at March 31, 2025

(in thousands of dollars) Telesat <br>Corporation Telesat <br>Partnership Telesat <br>LLC Telesat <br>Canada Guarantor <br>subsidiaries Non- <br>guarantor <br>subsidiaries Adjustments Consolidated
Assets
Cash and cash equivalent $ 705 $ 4,619 $ — $ 171,989 $ 75,215 $ 544,843 $ — $ 797,371
Trade and other receivables 1,128 — — 28,849 11,831 20,496 — 62,304
Other current financial assets — 31 — 542 224 5 (117 ) 685
Intercompany receivables 7,639 1 — 245,045 14,848 121 (267,654 ) —
Current income tax <br>recoverable — 1,818 — 25,417 869 706 — 28,810
Prepaid expenses and other current assets 630 — — 6,013 5,611 256,800 (3,286 ) 265,768
Total current assets 10,102 6,469 — 477,855 108,598 822,971 (271,057 ) 1,154,938
Satellites, property and other equipment — — — 78,102 445,424 1,898,507 6,924 2,428,957
Deferred tax assets — — — — 12,572 — (9,781 ) 2,791
Other long-term financial <br>assets — 8,465 — 51,678 4,354 81 (51,625 ) 12,953
Long-term income tax recoverable — — — 6,993 — — — 6,993
Other long-term assets — — — 99,953 — 317,874 — 417,827
Intangible assets — — — 302 355,094 188,729 (56,827 ) 487,298
Investment in affiliates 331,180 415,355 — 2,662,082 178,321 — (3,586,938 ) —
Goodwill — — — 549,162 — — 2,064,247 2,613,409
Total assets $ 341,282 $ 430,289 $ — $ 3,926,127 $ 1,104,363 $ 3,228,162 $ (1,905,057 ) $ 7,125,166
Liabilities
Trade and other payables $ 95 $ 43 $ — $ 26,584 $ 7,196 $ 58,746 $ — $ 92,664
Other current financial <br>liabilities 31 — — 39,689 3,816 — (117 ) 43,419
Intercompany payables 898 371 — 18,251 236,549 11,585 (267,654 ) —
Income taxes payable — 6,336 — — 264 113 — 6,713
Other current liabilities — — — 37,051 27,426 992 (3,286 ) 62,183
Total current liabilities 1,024 6,750 — 121,575 275,251 71,436 (271,057 ) 204,979
Long-term indebtedness — — — 3,097,544 — 255,664 — 3,353,208
Deferred tax liabilities — — — 153,622 — 27,748 (8,205 ) 173,165
Other long-term financial liabilities 8,465 209 — 19 55,612 650,493 (51,625 ) 663,173
Other long-term liabilities — 3,150 — 120,000 157,936 6,083 — 287,169
Total liabilities 9,489 10,109 — 3,492,760 488,799 1,011,424 (330,887 ) 4,681,694
Shareholders’ equity 331,793 420,180 — 433,367 615,564 2,216,738 (1,574,170 ) 2,443,472
Total liabilities and shareholders’ equity $ 341,282 $ 430,289 $ — $ 3,926,127 $ 1,104,363 $ 3,228,162 $ (1,905,057 ) $ 7,125,166

49

Unaudited Interim Condensed Consolidating Balance Sheets As at December 31, 2024

(in thousands of dollars) Telesat<br>Corporation Telesat<br>Partnership Telesat<br>LLC Telesat<br>Canada Guarantor<br>subsidiaries Non-<br>guarantor<br>subsidiaries Adjustments Consolidated
Assets
Cash and cash equivalents $ 895 $ 4,998 $ — $ 150,425 $ 59,066 $ 336,680 $ — $ 552,064
Trade and other receivables 1,128 — — 34,557 16,769 106,476 — 158,930
Other current financial assets — 4 — 228 333 6 (6 ) 565
Intercompany receivables 2,017 — — 237,804 12,885 284 (252,990 ) —
Current income tax <br>recoverable — 1,817 — 26,602 823 526 (515 ) 29,253
Prepaid expenses and other current assets — — — 4,735 6,716 273,836 (4,827 ) 280,460
Total current assets 4,040 6,819 — 454,351 96,592 717,808 (258,338 ) 1,021,272
Satellites, property and other equipment — — — 81,255 467,204 1,721,521 7,163 2,277,143
Deferred tax assets — — — — 12,837 — (9,778 ) 3,059
Other long-term financial <br>assets — 8,464 — 48,301 4,537 81 (51,616 ) 9,767
Long-term income tax recoverable — — — 6,993 — — — 6,993
Other long-term assets — — — 99,987 — 416,520 — 516,507
Intangible assets — — — 362 363,320 188,774 (54,990 ) 497,466
Investment in affiliates 388,133 471,533 — 2,719,014 53,309 — (3,631,989 ) —
Goodwill — — — 549,162 — — 2,063,810 2,612,972
Total assets $ 392,173 $ 486,816 $ — $ 3,959,425 $ 997,799 $ 3,044,704 $ (1,935,738 ) $ 6,945,179
Liabilities
Trade and other payables $ 39 $ 5 $ — $ 21,409 $ 7,132 $ 129,691 $ — $ 158,276
Other current financial <br>liabilities 4 — — 23,461 3,024 — (6 ) 26,483
Intercompany payables 312 367 — 10,259 236,319 5,733 (252,990 ) —
Income taxes payable — 5,851 — — — 577 (515 ) 5,913
Other current liabilities — — — 38,734 31,234 766 (4,828 ) 65,906
Total current liabilities 355 6,223 — 93,863 277,709 136,767 (258,339 ) 256,578
Long-term indebtedness — — — 3,096,615 — — — 3,096,615
Deferred tax liabilities — — — 156,000 — 27,742 (8,198 ) 175,544
Other long-term financial liabilities 8,464 209 — 19 56,345 617,135 (51,616 ) 630,556
Other long-term liabilities — 3,217 — 123,382 160,800 1,782 — 289,181
Total liabilities 8,819 9,649 — 3,469,879 494,854 783,426 (318,153 ) 4,448,474
Total shareholders’ equity 383,354 477,167 — 489,546 502,945 2,261,278 (1,617,585 ) 2,496,705
Total liabilities and shareholders’ equity $ 392,173 $ 486,816 $ — $ 3,959,425 $ 997,799 $ 3,044,704 $ (1,935,738 ) $ 6,945,179

50

Unaudited Interim Condensed Consolidating Statements of Cash Flows For the three months ended March 31, 2025

(in thousands of dollars) Telesat <br>Corporation Telesat <br>Partnership Telesat <br>LLC Telesat <br>Canada Guarantor <br>subsidiaries Non-<br>guarantor <br>subsidiaries Adjustments Consolidated
Cash flows from (used in) operating activities
Net income (loss) $ (49,472 ) $ (48,008 ) $ — $ (47,200 ) $ 28,420 $ (44,042 ) $ 108,845 $ (51,457 )
Adjustment to reconcile net income (loss) to cash flows from operating activities
Depreciation — — — 3,264 21,748 658 239 25,909
Amortization — — — 60 8,934 85 1,820 10,899
Tax expense (recovery) — 586 — (1,064 ) 1,372 24 — 918
Interest expense 28 44 — 53,372 4,094 96 (970 ) 56,664
Interest income (11 ) (49 ) — (1,500 ) (1,610 ) (4,142 ) 970 (6,342 )
(Gain) loss on changes in fair value of financial <br>instruments — — — — — 33,412 — 33,412
(Gain) loss on foreign <br>exchange 5 (1 ) — 224 (196 ) (2,512 ) — (2,480 )
Share-based compensation 447 — — 2,778 373 (357 ) — 3,241
(Income) loss from equity investments 48,008 47,200 — 15,836 (214 ) — (110,830 ) —
(Gain) loss on disposal of <br>assets — — — (3,950 ) — — — (3,950 )
Deferred revenue amortization — — — (3,750 ) (10,657 ) — — (14,407 )
Pension expense — 138 — 771 — 457 — 1,366
Other — — — (102 ) (589 ) — — (691 )
Income taxes paid, net of income taxes received — (103 ) — (127 ) (668 ) (682 ) — (1,580 )
Interest paid, net of interest received (17 ) 48 — (34,272 ) (458 ) 3,349 — (31,350 )
Operating assets and liabilities 822 (240 ) — (1,297 ) 5,656 113,905 (74 ) 118,772
Net cash from (used in) operating activities (190 ) (385 ) — (16,957 ) 56,205 100,251 — 138,924
Cash flows (used in) generated from investing activities
Cash payments related to satellite programs — — — — — (200,313 ) — (200,313 )
Cash payments related to property and other <br>equipment — — — (402 ) (27 ) (34,315 ) — (34,744 )
Net proceeds from disposal of assets — — — 4,500 — — — 4,500
Return of capital to <br>shareholder — — — 40,566 — — (40,566 ) —
Net cash (used in) generated investing activities — — — 44,664 (27 ) (234,628 ) (40,566 ) (230,557 )

51

Unaudited Interim Condensed Consolidating Statements of Cash Flows For the three months ended March 31, 2025 — (Continued)

(in thousands of dollars) Telesat <br>Corporation Telesat <br>Partnership Telesat <br>LLC Telesat <br>Canada Guarantor <br>subsidiaries Non-<br>guarantor <br>subsidiaries Adjustments Consolidated
Cash flows (used in) generated from financing activities
Proceeds from indebtedness — — — — — 340,000 — 340,000
Payments of principal on lease liabilities — — — (368 ) (147 ) — — (515 )
Satellite performance incentive payments — — — — (190 ) — — (190 )
Tax withholdings on settlement of restricted and performance share units — — — (5,951 ) (432 ) (405 ) — (6,788 )
Return of capital to <br>shareholder — — — — (40,566 ) — 40,566 —
Dividends paid — — — — — — — —
Net cash (used in) generated from financing activities — — — (6,319 ) (41,335 ) 339,595 40,566 332,507
Effect of changes in exchange rate on cash and cash equivalent — 6 — 176 1,306 2,945 — 4,433
Changes in cash and cash equivalents (190 ) (379 ) — 21,564 16,149 208,163 — 245,307
Cash and cash equivalents, beginning of period 895 4,998 — 150,425 59,066 336,680 — 552,064
Cash and cash equivalents, end of period $ 705 $ 4,619 $ — $ 171,989 $ 75,215 $ 544,843 $ — $ 797,371

52

Unaudited Interim Condensed Consolidating Statements of Cash Flows For the three months ended March 31, 2024

(in thousands of dollars) Telesat <br>Corporation Telesat <br>Partnership Telesat <br>LLC Telesat <br>Canada Guarantor <br>subsidiaries Non-<br>guarantor <br>subsidiaries Adjustments Consolidated
Cash flows from (used in) operating activities
Net income (loss) $ (49,929 ) $ (49,254 ) $ — $ (47,639 ) $ 34,039 $ 1,461 $ 58,985 $ (52,337 )
Adjustment to reconcile net income (loss) to cash flows from operating activities
Depreciation — — — 3,363 31,725 840 467 36,395
Amortization — — — 60 660 81 2,022 2,823
Tax expense (recovery) — 1,291 — 1,877 1,408 1,906 — 6,482
Interest expense 27 104 — 61,716 3,269 1 (687 ) 64,430
Interest income (8 ) (42 ) — (3,392 ) (2,011 ) (16,472 ) 629 (21,296 )
(Gain) loss on foreign <br>exchange 6 (27 ) — 66,938 60 1,436 — 68,413
Share-based compensation — — — 4,817 657 (40 ) — 5,434
(Income) loss from equity investments 49,254 47,639 — (35,153 ) (347 ) — (61,393 ) —
(Gain) loss on disposal of <br>assets — — — (15 ) — — — (15 )
Deferred revenue amortization — — — (5,879 ) (7,780 ) — — (13,659 )
Pension expense — 175 — 1,234 — — — 1,409
Other — — — 197 — — — 197
Income taxes paid, net of income taxes received — (50 ) — (7,925 ) (765 ) (2,756 ) — (11,496 )
Interest paid, net of interest received (19 ) 42 — (36,625 ) 1,222 17,233 — (18,147 )
Government grant received — — — — — 1,085 — 1,085
Operating assets and liabilities 676 (164 ) — 8,265 1,404 (3,205 ) (23 ) 6,953
Net cash from (used in) operating activities 7 (286 ) — 11,839 63,541 1,570 — 76,671
Cash flows (used in) generated from investing activities
Cash payments related to satellite programs — — — — — (757 ) — (757 )
Cash payments related to property and other <br>equipment — — — (1,220 ) (174 ) (17,884 ) — (19,278 )
Government grant received — — — — — 109 — 109
Return of capital to <br>shareholder — — — 40,641 — — (40,641 ) —
Net cash (used in) generated investing activities — — — 39,421 (174 ) (18,532 ) (40,641 ) (19,926 )

53

Unaudited Interim Condensed Consolidating Statements of Cash Flows For the three months ended March 31, 2024 — (Continued)

(in thousands of dollars) Telesat <br>Corporation Telesat <br>Partnership Telesat <br>LLC Telesat <br>Canada Guarantor <br>subsidiaries Non-<br>guarantor <br>subsidiaries Adjustments Consolidated
Cash flows (used in) generated from financing activities
Payments of principal on lease liabilities — — — (392 ) (186 ) (69 ) — (647 )
Satellite performance incentive payments — — — (559 ) (152 ) — — (711 )
Tax withholdings on settlement of restricted and performance share units — — — (1,963 ) (130 ) (23 ) — (2,116 )
Return of capital to <br>shareholder — — — — (40,641 ) — 40,641 —
Net cash (used in) generated from financing activities — — — (2,914 ) (41,109 ) (92 ) 40,641 (3,474 )
Effect of changes in exchange rate on cash and cash equivalent 15 173 — 4,823 2,374 26,554 — 33,939
Changes in cash and cash equivalents 22 (113 ) — 53,169 24,632 9,500 — 87,210
Cash and cash equivalents, beginning of period 708 7,800 — 280,859 140,561 1,239,161 — 1,669,089
Cash and cash equivalents, end of period $ 730 $ 7,687 $ — $ 334,028 $ 165,193 $ 1,248,661 $ — $ 1,756,299

54

CURRENT SHARE INFORMATION

The number of shares and stated value of the outstanding Class A common shares and Class B variable voting shares (“Telesat Public shares”), and Class C fully voting shares and Class C limited voting shares (together, the “Class C shares”) as at March 31, 2025, were as follows:

Number of <br>shares Stated <br>value
Telesat Public shares 14,362,541 $ 59,631
Class C shares 112,841 6,340
14,475,382 $ 65,971

The breakdown of the number of shares of Telesat Public Shares, as at March 31, 2025, was as follows:

Telesat Public shares
Class A Common shares 3,061,121
Class B Variable Voting shares 11,301,420
Total Telesat Public shares 14,362,541

The split between the Class A Common shares and Class B Variable Voting shares in the table above is based on information available to the Company as at March 31, 2025.

In addition, we have one Class A Special Voting Share, one Class B Special Voting Share, one Class C Special Voting Share and one Golden Share outstanding, each with a nominal stated value as at March 31, 2025.

The number of outstanding stock options, restricted share units (“RSUs”), performance share units (“PSUs”) and deferred share units (“DSUs”) issued under our Omnibus Plan and Historic Plan as at March 31, 2025 were as follows:

Historic <br>Plan Omnibus <br>Plan
Stock Options 52,628 757,494
RSUs with time criteria — 479,435
RSUs with time and performance criteria 124,080 —
PSUs with time and performance criteria — 430,271
DSUs — 200,433
176,708 1,867,633

Each of the foregoing securities can be settled or exercised, as applicable, for Telesat Public Shares.

During the three months ended March 31, 2025, 443,485 RSUs were settled for 223,671 Telesat Public Shares, on a net settlement basis.

During the three months ended March 31, 2025, 93,454 PSUs were settled for 46,360 Telesat Public Shares.

During the three months ended March 31, 2025, 12,500 Telesat Public Shares were issued in exchange for an equal number of Class A Limited Partnership units (“LP Units”) in the Partnership.

The number and stated value of the outstanding LP Units issued by Telesat Partnership LP as at March 31, 2025, were as follows:

Number of <br>units Stated <br>value
Class A and Class B LP Units 18,309,292 $ 50,107
Class C LP Units 18,098,362 38,893
36,407,654 $ 89,000

On consolidation into Telesat Corporation, the stated value of the LP Units is included in non-controlling interest.

55

CRITICAL ACCOUNTING JUDGMENTS AND ESTIMATES

The preparation of financial statements in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IASB”) requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as at the date of the financial statements, and the amounts of revenue and expenses reported for the year. Actual results could differ from these estimates under different assumptions and conditions. For more details on these estimates, refer to Note 4 of our audited consolidated financial statements for the year ended December 31, 2024.

Orbital Slot Intangible Assets

Prior to January 1, 2025, our accounting estimates concerning the appropriate useful economic lives of GEO orbital slots have been that they have indefinite lives as it was expected, with a relatively high level of certainty, that we would maintain continued occupancy of an assigned GEO orbital slot either during the operational life of an existing orbiting satellite or upon replacement by a new satellite once the operational life of the existing orbiting satellite is over.

To respond to market dynamics, we are focused on developing our constellation of LEO satellites. A large part of its current and future capital expenditures are expected to be related to this constellation. In light of market developments, the number of occupied operational GEO orbital slots is likely to decline over time and we no longer believes that the existing GEO orbital slots will continue to be utilized for an indefinite period of time.

As a result, we have updated our estimates in this area such that all GEO orbital slots are now presented as finite life assets. For those orbital slots which were formerly presented as indefinite life assets, their residual carrying values will generally be amortized over the remaining life of the on-station satellite operating at that orbital position in accordance with the provisions of International Accounting Standard 38, Intangible Assets (“IAS 38”). Where more than one satellite is co-located at one position then the latest end of life amongst those satellites is used. Where the likelihood of procuring a new or replacement satellite is probable, we calculate the end of life of that uncommitted replacement and applies it in computing the amortization life of the relevant orbital slot. The useful lives applied in the amortization of orbital slots range from 1 to 34 years.

This change in accounting estimate regarding the useful lives of the orbital slots has been accounted for prospectively, beginning on January 1, 2025.

The critical accounting judgements and estimates used in the application of our accounting policies are consistent with those outlined in Note 4 of the consolidated financial statements for the year ended December 31, 2024, apart from those outlined above related to the amortization of orbital slot intangible assets.

ACCOUNTING STANDARDS

Future Changes in Accounting Policies

The IASB periodically issues new and amended accounting standards. The new and amended standards determined to be applicable to us are disclosed below. The remaining new and amended standards have been excluded as they are not applicable.

IFRS 18, Presentation and Disclosures in Financial Statements

In April 2024, the IASB issued IFRS 18, Presentation and Disclosures in Financial Statements (“IFRS 18”) with the aim of improving companies’ reporting of financial performance and give investors a better basis for analyzing and comparing companies.

IFRS 18 introduces three new sets of requirements:

  1. Improved comparability in the statement of profit or loss (income statement) which introduces three defined categories for income and expenses: operating, investing and financing. These changes would require all companies to use the same structure of the income statement, provide new defined subtotals, including operating profit.

56

  1. Enhanced transparency of management-defined performance measures which would require companies to disclose explanations of those company specific measures that are related to the income statement.

  2. More useful grouping of information in the financial statements which provides enhanced guidance on how to organize information and whether to provide it in the primary financial statements or in the notes.

IFRS 18 is effective for annual reporting periods beginning on or after January 1, 2027, with early adoption permitted.

We are currently evaluating the impact of this new standard.

Item 3.       Quantitative and Qualitative Disclosures About Market Risk

See Item. 2 Management’s Discussion and Analysis of Financial Condition and Results of Operations, and the section “Market Risk”.

57

PART II. OTHER INFORMATION

Item 1.       Legal Proceedings

We discuss certain legal proceedings in Telesat Corporation’s Annual Report on Form 20-F for the fiscal year ended December 31, 2024, filed with the SEC, in the section titled “Legal Proceedings”. We refer the reader to that discussion for information concerning those proceedings. There have been no material developments in those proceedings since the filing of that report.

Item 1A.    Risk Factors

Our business and operations are subject to a significant number of known and unknown risks and uncertainties. The most significant of the known risks are summarized in, and the reader’s attention is directed to, the section titled “Risk Factors” of Telesat Corporation’s Annual Report on Form 20-F for the fiscal year ended December 31, 2024, filed with the SEC on March 27, 2025. There have been no material changes to those risk factors since the filing of these report.

Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially adversely affect our business, financial condition or operating results.

Item 2.       Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3.       Defaults Upon Senior Securities

None.

Item 4.       Reserved

Item 5.       Other Information

None.

Item 6.       Exhibits

None.

58

Exhibit 99.2

FORM 52-109F2 CERTIFICATION OF INTERIM FILINGS FULL CERTIFICATE

I, Daniel S. Goldberg, the President and Chief Executive Officer of Telesat Corporation, certify the following:

1.      Review: I have reviewed the interim financial report and interim MD&A (together, the “interim filings”) of Telesat Corporation (the “issuer”) for the interim period ended March 31, 2025.

2.      No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings.

3.      Fair presentation: Based on my knowledge, having exercised reasonable diligence, the interim financial report together with the other financial information included in the interim filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the interim filings.

4.      Responsibility: The issuer’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings, for the issuer.

5.      Design: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer’s other certifying officer(s) and I have, as at the end of the period covered by the interim filings

(a)     designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that

(i)     material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and

(ii)    information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and

(b)    designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer’s GAAP.

5.1    Control framework: The control framework the issuer’s other certifying officer(s) and I used to design the issuer’s ICFR is based on the principles set out in the “Internal Control — Integrated Framework (2013)” issued by The Committee of Sponsoring Organizations of the Treadway Commission (COSO).

5.2    ICFR — material weakness relating to design: N/A

5.3    Limitation on scope of design: N/A

6.      Reporting changes in ICFR: The issuer has disclosed in its interim MD&A any change in the issuer’s ICFR that occurred during the period beginning on January 1, 2025 and ended on March 31, 2025 that has materially affected, or is reasonably likely to materially affect, the issuer’s ICFR.

Date: May 6, 2025
/s/ Daniel S. Goldberg
Daniel S. Goldberg
President and Chief Executive Officer

Exhibit 99.3

FORM 52-109F2 CERTIFICATION OF INTERIM FILINGS FULL CERTIFICATE

I, Andrew Browne, the Chief Financial Officer of Telesat Corporation, certify the following:

1.      Review: I have reviewed the interim financial report and interim MD&A (together, the “interim filings”) of Telesat Corporation (the “issuer”) for the interim period ended March 31, 2025.

2.      No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings.

3.      Fair presentation: Based on my knowledge, having exercised reasonable diligence, the interim financial report together with the other financial information included in the interim filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the interim filings.

4.      Responsibility: The issuer’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings, for the issuer.

5.      Design: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer’s other certifying officer(s) and I have, as at the end of the period covered by the interim filings

(a)     designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that

(i)     material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and

(ii)    information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and

(b)    designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer’s GAAP.

5.1    Control framework: The control framework the issuer’s other certifying officer(s) and I used to design the issuer’s ICFR is based on the principles set out in the “Internal Control — Integrated Framework (2013)” issued by The Committee of Sponsoring Organizations of the Treadway Commission (COSO).

5.2    ICFR — material weakness relating to design: N/A

5.3    Limitation on scope of design: N/A

6.      Reporting changes in ICFR: The issuer has disclosed in its interim MD&A any change in the issuer’s ICFR that occurred during the period beginning on January 1, 2025 and ended on March 31, 2025 that has materially affected, or is reasonably likely to materially affect, the issuer’s ICFR.

Date: May 6, 2025
/s/ Andrew Browne
Andrew Browne
Chief Financial Officer

Report a Problem

Category
Description
Email (optional, for follow-up)