News Press Releases

SiriusXM Canada Reports Record Total Subscribers and Revenue for Fiscal 2015 Year-End and Fourth Quarter

October 29, 2015

Canada NewsWire

TORONTO, Oct. 29, 2015

- Net self-pay subscriber growth for the year fuels total subscriber all-time high, top-line improvements and increased profitability -

TORONTO, Oct. 29, 2015 /CNW/ - Sirius XM Canada Holdings Inc. ("SiriusXM Canada" or the "Company") (TSX: XSR), parent of Sirius XM Canada Inc., today released financial results for its fiscal year 2015 ("FY2015") and fourth quarter ("Q4 FY2015") ended August 31, 2015 prepared in accordance with International Financial Reporting Standards (IFRS). A summary of IFRS financial results for Q4 FY2015 and FY2015 is attached. All results are reported in Canadian dollars unless otherwise stated.

Q4 and Year-End FY2015 Financial and Operating Metrics

The figures below include certain non-GAAP measures and industry metrics. These figures are subject to the qualification and assumptions set out in the Company's notes to such results. For easier comparability, the table and financial review below exclude the impact of income tax expense and withholding tax expense due to Canada Revenue Agency reassessments in FY2015 and the impact of the Company's debt refinancing in FY2014. Please see the Company's reconciliation table below or the Company's MD&A for more detail.


Financial¹	Q4 FY2015	Q4 FY2014	% Change	FY2015	FY2014	% Change
	Aug 31, 2015	Aug 31, 2014		Aug 31, 2015	Aug 31, 2014
		(Restated)

Revenue	83,709	77,121	8.5%	325,874	303,500	7.4%
Adjusted EBITDA²	12,792	12,202	4.8%	79,214	79,025	0.2%
Normalized net income³	2,406	1,200	100.5%	28,227	19,708	43.2%
Normalized free cash flow⁴	15,817	10,501	50.6%	55,157	45,944	20.1%

Operating¹
Self-Paying Subscribers	1,925	1,852	4.0%	1,925	1,852	4.0%
Total Subscribers	2,726	2,612	4.4%	2,726	2,612	4.4%
Self-Pay ARPU⁵	$12.69	$12.25	3.6%	$12.61	$12.15	3.8%
Subscriber Acquisition Cost (SAC)	$40	$38	5.3%	$39	$38	2.6%
Cost Per Gross Addition (CPGA)	$71	$66	7.6%	$66	$64	3.1%

¹All figures in the table above are in thousands except, ARPU, SAC and CPGA.

²Adjusted EBITDA is a non-GAAP measure. A reconciliation of income (loss) before taxes to both EBITDA and Adjusted EBITDA,
including a one-time $15.9 million withholding tax in FY2015 is provided below.

³Adjusted for a one-time after-tax $12.2 million debt refinancing charge in FY2014 as well as a $15.9 million withholding tax
expense and a $19.1 million, non-cash income tax expense for FY2015. Please refer to the reconciliation tables below and
the Company's MD&A for more detail.

⁴FY2014 adjusted for $10.4 million call premium related to the Company's debt refinancing.

⁵Self-Pay ARPU is derived from the total of earned subscription revenue from Self-Pay subscribers and the music royalty and
regulatory fee and activation fees, divided by the monthly weighted average number of Self-Paying subscribers. Please see
the Company's MD&A for a more detailed description.

"Fiscal 2015 ended on a high note, with us delivering growth across all of our key metrics," said Mark Redmond, President and CEO, SiriusXM Canada. "Total subscribers reached at an all-time high, and we delivered record quarterly and annual revenue. Supported by substantial net self-pay subscriber additions in Q4, we achieved our stated goal of mid-single digit growth for the year. We also generated year-over-year improvements in Adjusted EBITDA and normalized free cash flow. This was despite a much larger cost base due to higher copyright fees and increasing foreign exchange headwinds as we moved through the year. As expected, we saw churn continue to improve in Q2, Q3 and Q4, with it coming in particularly strong at 1.76 per cent for the quarter."

Mr. Redmond continued: "With the superior overall audio entertainment experience we provide and our growing addressable market, our long-term opportunities are significant. Our content is a major competitive advantage. It is unrivaled. As we continue to demonstrate with the launch of new shows and channels, we are committed to further enhancing our programming line-up to attract even more listeners. We remain confident in our ability to continue to deliver top-line growth, strong Adjusted EBITDA and free cash flow."

Key Factors Affecting FY2015 and FY2014 Reported Results
For FY2014 and FY2015 periods, there were one-time events that affected the Company's results. In Q3 FY2014, the Company redeemed $130.8 million outstanding 9.75% senior notes that were due 2018. This resulted in a total pre-tax debt refinancing charge of $16.6 million (after-tax - $12.2 million) including $10.4 million call premium for early redemption of debt. For FY2015, the company recognized a one-time, non-cash $19.1 million income tax expense and a $15.9 million withholding tax expense in Q2 2015 related to Canada Revenue Agency reassessments that the Company is currently disputing. For the discussion below, the Company has compared normalized results as it believes this approach provides a more accurate depiction of its year-over-year performance. Please refer to the reconciliation tables below and the Company's MD&A for more detail.

Q4 and Year-End FY2015 Results Financial Review
For Q4 FY2015, revenue was $83.7 million, up $6.6 million, or 8.5%, from $77.1 million in Q4 FY2014. The year-over-year improvement reflects growth in the Company's self-paying subscriber base and an increase in Self-Pay ARPU. Q4 FY2015 Self-Pay ARPU was $12.69, up 3.6% from $12.25 in Q4 FY2014 driven by the Company's implementation of its increased Music Royalty and Regulatory Fee (MRF) on renewing subscribers. For FY2015, revenue was $325.9 million, up $22.4 million, or 7.4%, from $303.5 million for FY2014. Self-Pay ARPU for FY2015 was $12.61, up 3.8% compared to $12.15 for FY2014.

Adjusted EBITDA for Q4 FY2015, increased $0.6 million, or 4.8%, to $12.8 million from $12.2 million in Q4 FY2014. The year-over-year increase was a result of revenue growth partially offset by an increase in the Company's copyright fees and higher overall marketing costs due to increased volumes and penetration rates, investments in the pre-owned vehicle market and product development costs. For FY2015, Adjusted EBITDA, which excludes a one-time adjustment related to the withholding tax provision the Company took, was $79.2 million, an increase of $0.2 million, or 0.2%, from $79.0 million for the same period in FY2014.

The Company recorded net income of $2.4 million in Q4 FY2015, up $1.2 million, or 100.5%, compared to net income of $1.2 million in Q4 FY2014. For FY2015, net income was $28.2 million, excluding a one-time income tax expense and withholding tax expense. This was up $8.5 million, or 43.2%, from net income of $19.7 million for FY2014, after normalizing for the after-tax debt refinancing charge the Company incurred in FY2014.

SAC for Q4 FY2015 was $40, up from $38 in Q4 FY2014 as a result of higher subsidy costs and an unfavorable impact of a weakened Canadian dollar versus the US dollar. SAC increased marginally to $39 in FY2015 from $38 in FY2014.

CPGA was $71 in Q4 FY2015, up from $66 in Q4 FY2014, reflecting higher subsidy and marketing costs, offset, in part, by higher gross additions from the pre-owned vehicle channel. CPGA increased to $66 in FY2015 from $64 in FY2014.

In Q4 FY2015, the Company generated $18.3 million in cash from operating activities, up $4.1 million, or 29.0%, from $14.2 million in cash from operating activities in Q4 FY2014. As a result of year-over-year changes in working capital and lower interest payments in FY2015, the Company generated $71.0 million in cash from operating activities, up $11.0 million, or 18.3%, from $60.0 million in cash from operating activities in FY2014, after adjusting for the call premium of $10.4 million related to the Company's debt refinancing.

The Company generated free cash flow of $15.8 million in Q4 FY2015, up $5.3 million, or 50.6%, from $10.5 million in Q4 FY2014 reflecting a $4.1 million increase in cash from operations coupled with a $1.2 million decrease in capital spending, as the Company completed the implementation of its unified Subscriber Management System, in Q3 FY2015. For FY2015, the Company generated $55.2 million of free cash flow, up $9.2 million, or 20.1%, compared to $45.9 million in FY2014, after adjusting for call premium for repayment of debt. The year-over-year increase reflects higher cash from operations offset by higher capital expenditures in FY2015.

As at August 31, 2015, the Company had total cash and cash equivalents of $26.1 million compared to $23.8 million as at May 31, 2015. The increase is primarily due to cash flow from operating activities of $18.3 million in Q4 FY2015 offset by dividend payments of $13.5 million and capital expenditures of $2.5 million.

Conference Call and Webcast Details
SiriusXM Canada will hold a conference call to discuss the Company's Q4 and year-end FY2015 results on Friday, October 30, 2015 at 8:30 a.m. ET. All interested parties can join the call by dialing 647-427-7450, or 1-888-231-8191. Please dial in 15 minutes prior to the call to secure a line. The conference will be archived for replay until Friday, November 6, 2015 at midnight. To access the archived conference call, please dial 416-849-0833 or 1-855-859-2056 and enter reservation code: 56558816. A live audio webcast of the conference call will be available here: http://bit.ly/1juTkrt . Please connect at least 15 minutes prior to the conference call top ensure adequate time for any software downloads that may be required. An archived replay will be available for 90 days.

Reconciliations
The following is a reconciliation of EBITDA and Adjusted EBITDA to Income (loss) before income taxes.


Adjusted EBITDA: Reconciliation		Three months ended August 31,		Fiscal year ended August 31,
In ($ 000's)		2015	2014	2015	2014
		Q4 2015	Q4 2014	FY 2015	FY 2014
			(Restated)

	Income (loss) before income taxes	3,564	2,029	24,416	11,373
	Interest expense & income	3,071	2,888	12,213	14,407
	Loss on debt repayment	—	—	—	16,636
	Foreign exchange loss	280	13	331	265
	Amortization	5,514	6,837	22,936	33,727
EBITDA		12,429	11,767	59,896	76,408
	Withholding tax expense	—	—	15,887	—
	Stock-based compensation	363	431	3,427	2,550
	Fair value adjustments *	—	4	4	67
Adjusted EBITDA		12,792	12,202	79,214	79,025

* Fair value adjustment relates to reduction in revenue due to valuation of deferred revenue as per purchase price accounting

For easier comparability, the table below shows the normalized results for fiscal FY2015 and FY2014 after adjusting for income tax expense and withholding tax expense in FY2015 and early redemption of debt in FY2014.

	FY 2015			FY 2014			Change
in ($000's)	As Reported	CRA Tax Reassessment	FY 2015 Normalized	As Reported	Loss on Debt	FY 2014 Normalized	$	%
Revenue	325,874	—	325,874	303,500	—	303,500	22,374	7.4%
Operating costs	250,091	—	250,091	227,093	—	227,093	22,998	10.1%
Depreciation and amortization	22,936	—	22,936	33,727	—	33,727	(10,791)	(32.0)%
Operating income	52,847	—	52,847	42,680	—	42,680	10,167	23.8%
Withholding tax expense	(15,887)	15,887	—	—	—	—	—	—%
Finance costs, net	(12,544)	—	(12,544)	(31,307)	16,636	(14,671)	2,127	(14.5)%
Income tax expense (recovery)	(31,164)	19,088	(12,076)	(3,892)	(4,409)	(8,301)	(3,775)	45.5%
Net income (loss)	(6,748)	34,975	28,227	7,481	12,227	19,708	8,519	43.2%
Add back:
Finance costs, net	(12,544)	—	(12,544)	(31,307)	16,636	(14,671)	2,127	(14.5)%
Income tax expense (recovery)	(31,164)	19,088	(12,076)	(3,892)	(4,409)	(8,301)	(3,775)	45.5%
Depreciation and amortization	22,936	—	22,936	33,727	—	33,727	(10,791)	(32.0)%
EBITDA	59,896	15,887	75,783	76,408	—	76,408	(625)	(0.8)%
Withholding tax expense	(15,887)	(15,887)	—	—	—	—	—	—%
Stock based compensation	3,427	—	3,427	2,550	—	2,550	877	34.4%
Fair value adjustments	4	—	4	67	—	67	(63)	(94.0)%
Adjusted EBITDA	79,214	—	79,214	79,025	—	79,025	189	0.2%

For complete definition of non-GAAP measures and for more details on the Company's Q4 and FY2015 results, please see the Company's Annual Management Discussion & Analysis filed October 29, 2015 which is incorporated herein by reference. The non-GAAP measures used in this press release should be used in addition to, but not as a substitute for, the analysis provided in the condensed consolidated financial statements for FY 2015.

Forward-Looking Statements
Certain statements included above may be forward-looking in nature. Such statements can be identified by the use of forward-looking terminology such as "expects," "may," "will," "should," "intend," "plan," or "anticipates" or the negative thereof or comparable terminology, or by discussions of strategy. Forward-looking statements include estimates, plans, expectations, opinions, forecasts, projections, targets, guidance, or other statements that are not statements of fact, including with respect to the payment of dividends in the future and future performance. Although SiriusXM Canada believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct, including with respect to the ability of the Company to pay dividends in the future, the redemption of Sirius XM Canada's 5.625% Senior Unsecured Notes, and the terms, timing and conditions of any refinancing of such notes. SiriusXM Canada's forward-looking statements are expressly qualified in their entirety by this cautionary statement. SiriusXM Canada makes no commitment to revise or update any forward-looking statements in order to reflect events or circumstances after the date any such statement is made, except as required by applicable law. Additional information identifying risks and uncertainties is contained in Sirius XM Canada Holdings Inc.'s filings with the Canadian securities regulators, available at www.sedar.com.

About SiriusXM Canada
Sirius XM Canada Holdings Inc. (TSX: XSR) operates as SiriusXM Canada. SiriusXM Canada, with more than 2.7 million subscribers, is the country's leading audio entertainment company and broadcasts more than 120 satellite radio channels featuring premier sports, news, talk, entertainment and commercial-free music. SiriusXM Canada offers an array of content from the most recognized news, entertainment and major sports brands including the NHL, NFL, NBA, NASCAR, CNN, CBC, FOX, BBC, Howard Stern, Disney, Comedy Central and more.

SiriusXM programming is available on a variety of devices including pre-installed and after-market radios in cars, trucks and boats, smartphones and mobile devices, and consumer electronics products for homes and offices. SiriusXM programming is also available online at www.siriusxm.ca and on Apple and Android-powered mobile devices.

SiriusXM Canada has partnerships with every major automaker and its radio products are available at more than 2,500 retail locations nationwide. To find out more about SiriusXM Canada, visit our website at www.siriusxm.ca.

SiriusXM Canada has been designated one of Canada's 50 Best Managed Companies six years in a row and 2013, 2014 and 2015 rankings in PROFIT 500's list of Canada's Fastest Growing Companies.

Join SiriusXM Canada on Facebook at facebook.com/siriusxmcanada, on Twitter at twitter.com/siriusxmcanada and on Youtube at youtube.com/siriusxmcanada.

CONSOLIDATED BALANCE SHEETS

At

August 31,

August 31,

(in thousands of Canadian dollars)

2015

2014

ASSETS

Current assets

Cash and cash equivalents

26,128

23,868

Accounts receivable

9,436

13,455

Prepaid expenses

5,337

4,251

Inventory

35

559

Total current assets

40,936

42,133

Long-term prepaid expenses

305

456

Property and equipment

4,285

4,508

Intangible assets

131,410

134,971

Deferred tax assets

19,428

50,592

Goodwill

96,733

96,733

Total assets

293,097

329,393

LIABILITIES AND SHAREHOLDERS' DEFICIENCY

Current liabilities

Trade and other payables

52,545

44,121

Due to related parties

15,950

9,146

Interest payable

3,966

3,966

Deferred revenue

153,076

146,111

Provisions

983

506

Total current liabilities

226,520

203,850

Deferred revenue

12,033

15,076

Other long-term liabilities

651

533

Due to related parties

1,208

1,324

Long-term debt

196,036

195,464

Provisions

95

374

Total liabilities

436,543

416,621

Shareholders' deficiency

Share capital

178,479

176,862

Contributed surplus

8,817

6,067

Accumulated deficit

(330,742)

(270,157)

Total shareholders' deficiency

(143,446)

(87,228)

Total liabilities and shareholders' deficiency

293,097

329,393

Approved by the Board of Directors

			(signed) Christine Magee					(signed) Anthony Viner
			Christine Magee, Director					Anthony Viner, Director

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (DEFICIENCY)
				Total
For the year ended August 31,	Share	Contributed	Accumulated	Shareholders'
(in thousands of Canadian dollars)	Capital	Surplus	Deficit	Equity (Deficiency)

Balance, September 1 , 2013	151,795	6,161	(149,713)	8,243
Net income for the period	—	—	7,481	7,481
Stock-based compensation	—	2,550	—	2,550
Dividends	—	—	(127,925)	(127,925)
Stock options exercised	3,528	(1,105)	—	2,423
Conversion of convertible notes	21,539	(1,539)	—	20,000
Balance at August 31, 2014	176,862	6,067	(270,157)	(87,228)

Balance, September 1 , 2014	176,862	6,067	(270,157)	(87,228)
Net loss for the period	—	—	(6,748	(6,748)
Stock-based compensation	—	3,427	—	3,427
Dividends	—	—	(53,837)	(53,837)
Stock options exercised	1,617	(677)	—	940
Balance at August 31, 2015	178,479	8,817	(330,742)	(143,446)

CONSOLIDATED STATEMENTS OF OPERATIONS AND
COMPREHENSIVE INCOME (LOSS)

For the year ended August 31,

(in thousands of Canadian dollars, except per share amounts)

2015

2014

Revenue

325,874

303,500

Operating expenses

Operating costs

250,091

227,093

Depreciation and amortization

22,936

33,727

Operating income

52,847

42,680

Withholding tax recovery (expense)

(15,887)

—

Finance costs, net

Interest income

288

843

Interest expense

(12,501)

(15,249)

Loss on debt repayment

—

(13,196)

Change in fair value of embedded derivative

—

(3,440)

Foreign exchange loss

(331)

(265)

Finance costs, net

(12,544)

(31,307)

Net income before income tax

24,416

11,373

Income tax expense

(31,164)

(3,892)

Net income (loss) and comprehensive income (loss)

(6,748)

7,481

Earnings (loss) per share - basic and diluted

(0.05)

0.06

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the year ended August 31,
(in thousands of Canadian dollars)		2015	2014
Cash provided by (used in)

OPERATING ACTIVITIES
Net income (loss) for the period		(6,748)	7,481
Add (deduct) items not involving cash
	Amortization of intangible assets	21,013	30,861
	Depreciation of property and equipment	1,923	2,866
	Income tax expense	31,164	3,892
	Stock-based compensation	3,427	2,550
	Accrued interest	—	1,261
	Interest accretion	572	3,821
	Change in fair value of embedded derivative	—	3,440
	Foreign exchange loss	583	171
Net change in non-cash working capital and deferred revenue related to operations		19,021	(6,778)
Cash provided by operating activities		70,955	49,565

INVESTING ACTIVITIES
Purchase of property and equipment		(1,845)	(1,148)
Purchase of intangible assets		(13,098)	(12,884)
Prepayment for property and equipment		(855)	—
Maturity of short-term investments		—	5,063
Interest received on short-term investments		—	199
Cash used in investing activities		(15,798)	(8,770)

FINANCING ACTIVITIES
Payment of dividends		(53,837)	(127,925)
Proceeds from issuance of debt		—	200,000
Debt financing fees		—	(4,733)
Repayment of debt		—	(130,771)
Proceeds from exercise of stock options		940	2,424
Cash used in financing activities		(52,897)	(61,005)

Net increase (decrease) in cash and cash equivalents during the year		2,260	(20,210)
Cash and cash equivalents, beginning of year		23,868	44,078
Cash and cash equivalents, end of year		26,128	23,868