MDA reports second quarter 2010 results

RICHMOND, BC, July 29 /CNW/ - MacDonald, Dettwiler and Associates Ltd. (TSX: MDA), a provider of essential information solutions, today reported financial results for the second quarter ended June 30, 2010. MDA's diversified businesses continue to deliver solid results. Operating earnings(1) per share were $0.83, up 17% compared to $0.71 for the second quarter of last year. GAAP earnings per share were $0.67.

    
    Financial Highlights
    -------------------------------------------------------------------------
                                       Q2-2010   Q2-2009  YTD-2010  YTD-2009
    -------------------------------------------------------------------------
    ($ thousands, except per
    common share amounts)

    Consolidated revenues              258,350   245,794   504,233   517,764

    Operating earnings                  34,067    28,752    67,087    52,345
    Operating earnings per common
     share, basic                         0.83      0.71      1.64      1.29
    Operating earnings per common
     share, diluted                       0.83      0.71      1.64      1.29

    Net earnings                        27,494    25,286    56,575    49,708
    Net earnings per common share,
     basic                                0.67      0.63      1.39      1.23
    Net earnings per common share,
     diluted                              0.67      0.62      1.38      1.23

    Weighted average number of
     common shares outstanding:
     (thousands)
      Basic                             40,889    40,455    40,788    40,435
      Diluted                           41,025    40,625    40,971    40,560

    Average exchange rates:
      1 US dollar to Canadian
       dollar                            1.028     1.167     1.034     1.206
      1 British pound to Canadian
       dollar                            1.533     1.807     1.579     1.797
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

Revenues from Information Systems for the second quarter increased to $141 million compared to $101 million for the same period of last year. Adjusted Information Products revenues(1) were $117 million this quarter, consistent with the same period a year ago before foreign exchange fluctuations. As at June 30, 2010, the Company's order backlog was $928 million (December 31, 2009 - $1,013 million).

Cash flow from operations remained strong. In the six months ended June 30, 2010, the Company made net debt repayments of $82 million, reducing long-term debt, less cash and cash equivalents, to $202 million.

MDA's unaudited consolidated financial statements and management's discussion and analysis for the three and six months ended June 30, 2010 are available at:

http://www.mdacorporation.com/corporate/investor/financial_reports.cfm

About MDA

MDA provides advanced information solutions that capture and process vast amounts of data, produce essential information, and improve the decision making and operational performance of business and government organizations worldwide.

Focused on markets and customers with strong repeat business potential, MDA delivers a broad spectrum of information solutions, ranging from complex operational systems, to tailored information services, to electronic information products.

The Company's common shares trade on the Toronto Stock Exchange under the symbol TSX:MDA.

Investor/Analyst Conference Call Today

MDA President and CEO Daniel Friedmann and Executive Vice President and CFO Anil Wirasekara will be available on a Conference Call today, July 29, 2010 at 2:30 p.m. Pacific (5:30 p.m. Eastern) to discuss the results of the Company and to answer questions.

Additional material for the conference call and webcast will be available to download from: http://www.mdacorporation.com/corporate/investor/

To participate, dial 1-888-231-8191 in Canada or the United States

International: 1-647-427-7450

The Conference Call will also be Webcast live and archived at:

http://www.mdacorporation.com/investor/events.cfm

Telephone replay will be available until August 5, 2010 at the following numbers:

    
    Toll free:  1-800-642-1687
    Toronto: 1-416-849-0833
    Pass Code 76121453

    Related Websites:
    www.mdacorporation.com
    

Non-GAAP Financial Measures

This earnings release includes certain non-GAAP financial measures. The Company uses non-GAAP financial measures as supplemental indicators of its operating performance and to assist readers in comparing operating results from period to period. These measures do not have any standardized meanings prescribed by Canadian GAAP and therefore may not be comparable to similar measures presented by other companies. Readers are cautioned not to view these non-GAAP financial measures as alternatives to financial measures calculated in accordance with GAAP. The non-GAAP financial measures are defined and reconciled to the most directly comparable Canadian GAAP measures in the following tables.

Operating earnings

The Company refers to net earnings adjusted for specified items affecting comparability as operating earnings.

    
    -------------------------------------------------------------------------
                                       Q2-2010   Q2-2009  YTD-2010  YTD-2009
    -------------------------------------------------------------------------
    ($ thousands)
    Operating earnings                  34,067    28,752    67,087    52,345

    Items affecting comparability:
     Stock-based compensation          (11,177)   (1,889)   (5,373)   (5,035)
     Fair value adjustments on
      equity forward contracts          10,341      (697)      458     5,218
     Fair value adjustments on
      foreign exchange forward
      contracts tied to certain
      projects not subject to hedge
      accounting                        (6,800)        -    (6,800)        -
     Foreign exchange gain on
      translation of intercompany
      balances                           2,108         -     2,108         -
     Fair value adjustments on
      interest rate swap contracts
      not subject to hedge
      accounting                           235         -      (414)        -
     Restructuring expense              (2,884)   (2,416)   (2,884)   (3,549)
     Tax on items affecting
      comparability                      1,604     1,536     2,393       729
    -------------------------------------------------------------------------
    Net earnings                        27,494    25,286    56,575    49,708
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

Adjusted Information Products revenues

To derive adjusted Information Products revenues for prior periods, the Company retroactively applies certain changes to revenue recognition which, for GAAP purposes, were applied prospectively.

    
    -------------------------------------------------------------------------
                                       Q2-2010   Q2-2009  YTD-2010  YTD-2009
    -------------------------------------------------------------------------
    ($ thousands)
    Adjusted Information Products
     revenues                          117,354   130,339   229,648   255,556
    Retroactive application of net
     revenue recognition to BC
     OnLine revenues                         -     6,116         -    25,809
    Retroactive application of net
     revenue recognition to certain
     contracts for valuation-related
     solutions in the U.K.                   -     7,945       670    16,700
    -------------------------------------------------------------------------
    Information Products revenues      117,354   144,400   230,318   298,065
    -------------------------------------------------------------------------


    Forward-Looking Statements
    --------------------------
    

This earnings release and the associated conference call and webcast, which includes a business update, second quarter 2010 results and question and answer session, contains certain forward-looking statements and information, which reflect the current view of MacDonald, Dettwiler and Associates Ltd. ("MDA") with respect to future events and financial performance. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may", "will", "expect", "intend", "anticipate", "plan", "foresee", "believe" or "continue" or the negatives of such terms or variations of them or similar terminology. Any such forward-looking statements are based on MDA's current expectations, estimates, projections and assumptions made in light of its experience and its perception of historical trends. Any such forward-looking statements are subject to risks and uncertainties and MDA's actual results of operations could differ materially from historical results or current expectations. You are referred to the risk factors described in MDA's most recent annual Management's Discussion and Analysis, Annual Information Form and other documents on file with the Canadian securities regulatory authorities, available online at www.sedar.com or www.mdacorporation.com. The forward-looking statements and information contained in this earnings release and the associated conference call and webcast represent MDA's views only as of today's date. MDA disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, other than as required by law, rule or regulation. You should not place undue reliance on forward-looking statements.

The Toronto Stock Exchange has neither approved nor disapproved the form or content of this release.

    
    ----------------------------------
    (1) See section "Non-GAAP Financial Measures" in this earnings release.
    

%SEDAR: 00014148E

SOURCE MacDonald, Dettwiler and Associates Ltd.

For further information: For further information: Wendy Keyzer, MDA External Relations, (604) 231-2743, wendy@mdacorporation.com


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