Welcome to the 2025 Annual General Meeting of Shareholders of MDA Space. Please note that today's meeting is being recorded. However, no attendees are permitted to use a recording device. I would like to introduce Brendan Paddock, the Chair of the Board of MDA Space. Mr. Paddick, the floor is yours.
Thank you, Michelangelo, and good morning, ladies and gentlemen. Welcome to the MDA Space Annual General Meeting of Shareholders. My name is Brendan Paddick, and I'm the Chair of the Board of MDA Space. MDA Space is holding this year's meeting in a virtual format, which provides the advantage of allowing registered shareholders and duly appointed proxy holders to participate and vote at the meeting from any location. I will now call this meeting to order. I will act as Chair of the meeting, and David Snir, MDA Space Vice President, General Counsel, and Corporate Secretary, will act as Secretary of this meeting. Unless there is an objection, I appoint Rebecca Prentiss of TSX Trust Company, MDA Space's Registrar and Transfer Agent, as Scrutineer for the meeting. Let me briefly explain the format of today's proceedings.
We will first deal with the necessary administrative items before proceeding to the formal business of this Annual General Meeting, which is to receive the 2024 financial statements, to elect the Board of Directors, to reappoint the auditor for the coming year, and to approve a non-binding advisory resolution on MDA Space's approach to executive compensation. As this say-on-pay vote is an advisory vote, the results are not binding on the board. Later, we will hear from Mike Greenley, MDA Space Chief Executive Officer and Director, who will provide a business update. Guillaume Lavoie, MDA Space Chief Financial Officer, is also with us today and will be available to answer questions during the Q&A portion of the meeting. Shereen Zahawi, MDA Space Senior Director of Investor Relations, will help us field your questions following the management presentation.
Given the virtual format of the meeting, Carl Smith, Chair of the Audit Committee of the Board, will perform my role in the event I am disconnected due to a technical malfunction or if I just screw up. Before we get to the formal business of the meeting, I want to share a few thoughts on how the Board of Directors sees MDA Space today and the opportunity we see for investors going forward. Any way you look at it, 2024 was a remarkable year for MDA Space and for MDA Space shareholders as we began to see the meaningful impact of our long-term strategic plan to pivot the business into the global commercial space market.
As Michael discussed in detail shortly, the strong 2024 financial performance delivered by MDA Space is a clear validation of a company with the right strategy at the right time in the right market. The company is not only meeting the moment, but it's maximizing the pace of growth in the global space market, accelerating its rate of commercial adoption and productization, and capitalizing on its unique competitive advantages of a talented MDA Space team and technology that is truly amongst the best anywhere in the world. As we discussed at this meeting last year, the market continues to evolve. We remain in the early innings of a multi-decade market transformation, and the board continues to see a compelling opportunity to deliver long-term and sustained value for MDA shareholders.
On behalf of the Board of Directors and the management team, I want to extend our sincere thanks to our shareholders for your continued support. As a result of our stock price performance in 2024, we were proud to end the year as one of the top five best-performing stocks on the S&P/TSX Composite Index based on share price appreciation throughout the fiscal year. We believe that MDA Space continues to offer a growth opportunity for investors looking for a position in a profitable and growing company in the ever-expanding space market that is uniquely experienced, differentiated by its solution set, and delivering today for customers and for shareholders. Finally, on behalf of the Board, I want to once again take this opportunity to thank MDA Space management and staff for their outstanding leadership, hard work, and commitment, which made last year's business and financial achievements possible.
We can all feel and see that MDA Space's momentum is building in the market, and it's a market that's on the move. We look forward to another year of working together to deliver on our shared mission to build the space between the proven and the possible. With that said, we will now move on to the business of the meeting. Once the formal business items of the meeting are complete, I will invite Mike Greenley to provide his remarks, which will be followed by a general question-and-answer session.
The Secretary has advised me that the notice calling this meeting to order, together with a form of proxy and management information circular, had been made available to each Director of the Corporation, the Auditor of the Corporation, and to each Intermediary and Registered Holder of Common Shares of the Corporation of record as of the record date of March 28, 2025, all in accordance with applicable law and the Corporation's bylaws. These materials are available on the Corporation's investor website at www.mda.space and on the Corporation's profile on CDAR. Our transfer agent, TSX Trust Company, has attested to the proper mailing of the proxy-related materials for the meeting, including the form of proxy, the VONI instruction form, and the notice and access notice advising that the notice of meeting and management information circular are available online.
The Scrutineer has provided me with her preliminary report regarding shareholder attendance at today's meeting, which confirms that there are common shares representing 69% of all outstanding common shares of the Corporation present at this virtual meeting or represented by a proxy. Accordingly, I declare that the requisite quorum of shareholders is present, and I also declare that the meeting is indeed duly and validly constituted. I direct that proof of mailing and the Scrutineer's final report on attendance be annexed to the minutes of this meeting. At this point, we would like to set out a couple of procedures to ensure orderly conduct given the virtual format of this meeting. Questions can be submitted by any registered shareholder or duly appointed proxy holder using the Ask a Question button on the virtual meeting platform.
When asking a question, please indicate your name, which entity you represent, if any, and confirm that you are a registered shareholder or duly appointed proxy holder. Questions will be addressed during the question period at the end of the meeting. Note that questions regarding procedural matters or those directly related to the motions before the meeting may be addressed during that part of the meeting. For the purposes of the meeting today, voting on all matters will be conducted by electronic ballot. I will now take a moment to ask that the balloting be open to registered shareholders and duly appointed proxy holders. The polls are now open. Registered shareholders and duly appointed proxy holders will be asked to vote on each business item after the presentation of all business items. However, you may also vote at any point throughout the business portion of the meeting.
Once discussions on all items of business have concluded, you will have an additional one minute to enter your votes if you have not already voted by proxy or voted during the course of the meeting, after which time I will declare voting closed on all resolutions. Finally, if you have already voted in advance, please do not vote again online during the meeting unless you would like to change your vote. If you vote again using the online ballot, your online vote during the meeting will revoke your previously submitted proxy. We will now proceed with the formal portion of today's meeting. I have been advised by Ian McLeod, Vice President of Corporate Development at MDA Space and a shareholder of MDA Space, that he would be prepared to second each of the motions in respect of those items outlined in the management information circular.
Accordingly, unless there are any objections, I will take such motions as seconded with no further action required. The first item of business is the presentation of the Corporation's consolidated financial statements for the year ended December 31st, 2024, and the auditor's report thereon. Copies of these documents have been mailed to shareholders who have requested them and are also available on the Corporation's website and on CDAR. It is not proposed to read the financial statements into the meeting. Receipt and presentation of the financial statements for the year ended December 31st, 2024, are hereby acknowledged, and I direct that the financial statements and the auditor's report thereon be annexed to the minutes of this meeting. We will now proceed with the election of directors. The number of directors to be elected at the meeting has been fixed at nine.
I move to nominate those persons specified in the management information circular for election as directors of the Corporation to hold offices until the next annual meeting of shareholders or until their successors are duly elected or appointed in accordance with the articles and bylaws of the Corporation and take such motion as having been seconded by Ian McLeod. The proposed nominees are Alison Alfers, Yaprak Baltacioğlu, Darren Farber, Michael Greenley, Brendan Paddick, John Risley, Jill Smith, Carl Smith, and Yung Wu. As the Corporation did not previously receive timely notice of any further nominations of persons for election as directors of the Corporation as required by MDA Space's bylaws, I declare the nominations closed.
I will now move that each of the nine persons nominated to be elected as directors of the Corporation to hold office until the next annual meeting of shareholders or until their successors are duly elected or appointed. I take such motion as having been duly seconded by Ian McLeod. I will now pause for a moment to allow for discussion and/or questions on this motion. I don't see or hear anything, thus there appears to be no need for further discussion at this time. I want to take a brief moment to thank my fellow board members for their insight, guidance, and constructive contributions to MDA Space and especially to me personally as we navigate this exciting and emerging space market. We will now proceed with the appointment of the auditor to the Corporation.
I move that KPMG LLP be appointed as auditor of the Corporation until the next annual meeting of shareholders or until a successor is appointed and that the Board of Directors is authorized to fix the auditor's remuneration. I take such motion as having been duly seconded by Ian McLeod. I will now pause for a moment to allow for discussion and/or questions on this motion. I don't see or hear anything, thus there appears to be no need for further discussion at this time. We will now proceed with approving on an advisory basis a resolution on MDA Space's approach to executive compensation. As this say-on-pay vote is advisory, the results are not binding on the board. However, the board will take the results of this vote into account as appropriate when considering future compensation policies, procedures, and decisions.
I will now move to pass a resolution in the form set forth on page 26 of the management information circular dated March 30, 2025, that was mailed in connection with this meeting. I will take such motion as having been duly seconded by Ian McLeod. I will now pause for a moment to allow for discussion and/or questions on this motion. I don't see or hear anything, thus there appears to be no need for further discussion at this time. As we mentioned earlier, voting will be conducted by electronic ballot. As a reminder, if you have already voted in advance, please do not vote again unless you would like to change your vote. If you vote again using the online ballot, your online vote will revoke your previously submitted proxy.
At this point, all registered shareholders and duly appointed proxy holders who have properly logged in with their control numbers and who wish to vote will be able to click on the voting icon to vote on the motions being brought forth at this meeting. Please register your votes by accessing the voting page and selecting the for, withhold, or against buttons next to each matter. Once the electronic ballot process closes, your vote will be automatically submitted. For the purposes of this process, I will now pause for one minute. Based on the preliminary Scrutineer's reports, I can confirm that a sufficient number of votes were received by proxy in advance of the meeting to pass all of the resolutions before us today. Accordingly, I am pleased to announce that each of the motions has been carried and the resolutions passed.
I direct that the results of the poll be included with the minutes of this meeting and that the final results of the voting will be announced in a press release in accordance with the policies of the TSX and filed on CDAR. Ladies and gentlemen, thank you. This concludes the formal portion of the meeting. It is now time to move to MDA Space's management presentation. Before we begin the presentation, Shereen Zahawi, MDA Space's Senior Director of Investor Relations, will provide a caution with respect to forward-looking information. Over to you, Shereen.
Thank you, Brendan. Today's oral and visual presentation will contain forward-looking statements which may differ from actual results. Please review the cautionary language in the MDA Space management discussion and analysis, annual information form, and other public filings regarding various factors, assumptions, and risks that could cause actual results to differ.
In addition, during this presentation, we will refer to certain non-IFRS financial measures. Although we believe these measures provide useful supplemental information about our financial performance, these measures do not have any standardized meaning under IFRS, and our approach in calculating these measures may differ from that of other corporate issuers and therefore may not be directly comparable. Please see the MDA Space management discussion and analysis and other public filings for more information about these measures, including reconciliations to the nearest IFRS measures. With that, I'll turn it over back to you, Brendan.
Thanks, Shereen. I'll now turn the call over to Mike to deliver his update. Mike, take it away.
Thank you, Brendan. For those listening out there, I have a bit of a cold today. I may cough occasionally, but everything will be fine.
Good morning, everyone, and thank you for joining us today for our annual general meeting of shareholders. 2024 marked another solid year of growth for MDA Space. We secured $2.4 billion in awards, which included the next phases of Canada Arm III, in addition to other strategic awards across our three business areas. We grew our revenues to $1.1 billion, an increase of 34% year over year, and expanded our adjusted EBITDA to $217 million, up 25% versus last year's levels, exceeding our guidance for the year on these two metrics. Our full-year adjusted EBITDA margin of 20% was robust and in line with our expectations. We generated operating cash flow of $816 million and free cash flow of $615 million, consistent with our expectations to turn free cash flow positive one year ahead of our prior plan. It was also a solid year on execution.
Throughout 2024, our teams continued to execute well on our programs with notable developments, including the successful completion of the Preliminary Design Review for the Telesat Lightspeed LEO Constellation program, a critical milestone for that program. We also continued to advance the manufacturing of MDA CORUS, our next-generation Earth observation constellation. Additionally, the MDA Space team also successfully conducted the Preliminary Design Review for the Canada Arm III program, another important engineering milestone. Operationally, to support current and future growth, we continued to focus on talent and recruitment, and in 2024, we added approximately 950 new staff. We also deployed $200 million in capital expenditures, which included research and development spending on technologies related to MDA CORUS, as well as MDA Aurora, our recently introduced software-defined digital satellite product line, and MDA SkyMaker, our suite of innovative space robotics supporting a diverse range of missions and applications.
We announced that construction is underway on a 185,000 sq ft expansion at our satellite production facility in Saint-Anne-de-Bellevue, Quebec. Once completed, this will be the world's largest high-volume manufacturing facility in its satellite class. Our teams also completed the move into our new global headquarters and Space Robotics Center of Excellence in Brampton, Ontario. These new facilities support our ongoing growth and lay the groundwork for long-term success in the evolving commercial space and robotics market. Last year, we were also pleased with the progress and momentum that we feel inside our company is being increasingly recognized by peers and others in the industry. In 2024, MDA Space was named as one of Greater Toronto's top employers and ranked by the Globe and Mail's Report on Business magazine as one of Canada's top growing companies in its annual ranking, to name just a few accolades.
Additionally, in early 2024, MDA Space was added to the S&P/TSX Composite Index, an important milestone in our life as a public company. The solid momentum has continued into 2025. In February of this year, we announced that MDA Space has been awarded a $1.1 billion follow-on contract to manufacture its next-generation LEO Constellation, which will include over 50 MDA Aurora digital satellites. This is our third LEO Constellation contract in three years and second constellation with Globalstar, further highlighting the continued momentum we are seeing in our satellite systems business driven by strong customer demand for our differentiated technology. Last month, we announced that we have entered into a definitive agreement to acquire SatixFy Communications, a leader in next-generation satellite communication solutions based on in-house design chipsets.
The transaction, once closed, is expected to further enhance the end-to-end satellite systems offering of MDA Space as demand for next-generation digital satellite communications continues to accelerate. With the growing space market as our backdrop and our backlog standing at approximately $5 billion at the end of Q1 2025, we expect 2025 to be another year of strong growth for the company, with revenues expected to be $1.5 billion-$1.65 billion, representing year-over-year growth of approximately 45% at the midpoint of that range. Full-year adjusted EBITDA is expected to be $290 million-$320 million, representing year-over-year growth of approximately 40% at the midpoint of guidance and approximately 19%-20% adjusted EBITDA margin.
Looking at our progress since our initial public offering in 2021, so our progress over the last four years, our backlog has grown from $463 million at the end of 2020 to $4.4 billion at the end of 2024, an increase of almost eight times. We have almost tripled our revenues from $412 million in 2020 to $1.1 billion in 2024, representing a 27% revenue CAGR, compounded annual growth rate, over this period. We have also more than doubled our adjusted EBITDA, excluding non-recurring items, from $85 million in 2020 to $217 million in 2024, representing a 26% CAGR over the period while maintaining solid adjusted EBITDA margin in the low 20% throughout this entire period. We have grown our adjusted net income from $28 million in 2020 to $111 million in 2024, representing a 42% CAGR over the period.
We have emerged as a sought-after satellite prime contractor for LEO constellations and launched a new leading-edge digital satellite product line, MDA Aurora, which provides a new level of performance and efficiency in space-based network for our customers. We've expanded our offerings in robotics and space operations to service more commercial enterprises as we commercialize technologies derived from Canada Arm III to meet the evolving needs of the new space market with the announcement of the MDA SkyMaker product line. We've continued to enhance our offerings in Earth observation markets with the MDA CORUS constellation designed to bring together diverse and unique imagery and data sources and provide a new level of near real-time insight in innovative Earth observation. We are just getting started.
With a diversified space technology portfolio that is already driving profitable growth, MDA Space is ideally placed to strengthen our market position and capitalize on opportunities we see emerging across the expanding space market. Looking at developments within the broader space ecosystem, we see a number of positive secular trends driving end market demand, from lower launch costs and new technologies that are enabling increased commercialization of space to an expanding role in enabling global connectivity and an increasing role in securing national defense interests. Illustrative of those trends, 2024 was another strong year for space market growth, with the research firm Nova Space estimating the space economy grew to $596 billion last year, up from $509 billion in the prior year. Governments around the globe continue to invest in space, with government space investments reaching approximately $135 billion in 2024, up 10% year over year.
Governments also continue to allocate a higher share of their space budgets to defense programs, which today comprise the majority of budgets at $73 billion, or 54%, underscoring the growing importance of space as a contested and strategic domain. The increase in spending reflects increased integration of space-based capability as a routine component of defense and military operations, driven by geopolitical tensions and demand for space-based surveillance and detection systems. Looking at the big picture, Nova Space estimates the size of the global space economy will grow to $944 billion by 2033, while other recent forecasts, including those from the World Economic Forum, project that the space economy will almost triple by 2035, driven by lower costs and wider access to space-enabled technologies.
All of this activity in the space sector bodes well for MDA Space and our future opportunity set, which we estimate today to be in excess of $20 billion in cumulative pipeline over the next five years. As a final word on 2024, I would like to thank our employees for their dedication and commitment to delivering for our customers. Our 3,400 talented people are key to our success, and we are fortunate to work in a field that energizes and attracts talent and pushes the boundaries of innovation every day. As we move through 2025, MDA Space is well positioned to continue our trajectory of growth and disciplined execution. Our strategy remains focused on leveraging our competitive strengths to accelerate our growth and capitalize on the expanding space market. We expect full-year 2025 revenues to rise significantly, with robust growth in adjusted EBITDA.
At the same time, the investments we've made in technology, infrastructure, and human capital have given us the capabilities to simultaneously execute on our backlog and drive future growth. Even in a time of rapid global change and uncertainty, our existing backlog gives us confidence in our ability to sustain growth in the coming years and continue to drive value for our shareholders, our customers, and our partners. With that, I'll hand it back to Brendan.
Thank you, Mike. It's now time to hear from our shareholders. As I indicated at the beginning of the meeting, any shareholder or proxy holder who would like to ask a question may use the Ask a Question button of the virtual interface in order to do so. We will answer as many questions as time reasonably permits. A reminder, when asking your question, please state your name, the entity you represent, if any.
Please limit your question to topics relating to today's subject matter. For each question, we will answer. We will summarize the question and state the name of the person who asked such question and, if applicable, the entity the person represents. Similar questions will be combined into one question to avoid repetition. Veraine, do we have any questions thus far?
Brendan, it appears that there are no questions at this time.
Okay. I'll pause for 30 seconds or so in case someone would like to type in any final questions. Veraine, have any questions come in?
We do have one question from Zachariah Abrams. Zachariah is asking, how can the company reduce operating costs and increase EPS and net income in the coming years?
Mike or Guillaume, like to take that one?
Yeah. I can address that question to some extent.
I think that as we go forward in the next few years, we'll remain in a period of strong continued growth. We continue to forecast that we'll have a 25% typically rate of growth each year over the next few years, primarily driven by execution on our backlog. With that, of course, EPS will continue to grow throughout that period of time. I would expect with that growth, if you continue our pattern of doubling every couple of years in our business and investing in continuous improvements to be able to facilitate sustained EBITDA margin rates during that scaling, that we will continue to make investments in the business. I would not see us getting into a situation where we would be driving a focused cost reduction effort.
I would expect, however, that with the increased volume of production that will be occurring through the next three years, that as we get into the 2027 period, we would expect to see opportunities for margin rate growth as a result of higher scale production. Higher volume production, the economies of scale that come with that should afford us the opportunity to see expanded margins in the future, and we intend to start talking about that in 2027 once we start to see our higher volume production in operation.
Thank you, Mike. Zachariah is also asking, what's the reason behind the increase in contract liabilities that we saw in 2024? So perhaps Guillaume can answer that.
Sure, of course.
As we take on more work and as our backlog increases, we do have a higher level of contractual liabilities, primarily with our supply chain, but that's just normal course of business, again, because of the higher volume of work that we're performing and the increase in the backlog that we saw over especially the last 12 months.
Thank you, Guillaume.
Any further questions?
I do not see any additional questions at this point. Let's just wait 10 or 15 seconds if anybody would like to type in a final question.
Veraine, any questions?
No additional questions, Brendan.
Okay. Thanks, Shereen. We are now concluding the question and answer session of the meeting, which concludes our annual general meeting of shareholders of MDA Space.
Before we close, I'd like to thank our former Chair, John Risley, for his vision, passion, and support, and the significant role he played in bringing MDA home. Thank you all for your attendance and your interest. We're excited to build upon this company's great legacy. We look forward to seeing you all again next year at our annual shareholders meeting. Goodbye for now. Thank you for attending today's meeting. You may now disconnect.