SIRIUS XM Radio Inc. (NASDAQ: SIRI) filed its annual report this week for 2010.  While many investors know many of the larger outstanding issues, annual reports always contain factoids that most investors do not know about and that they rarely take the time to consider.  With so many holders and so many customers who love SIRIUS XM, we wanted to highlight ten of these issues which are not so well known.

Its Satellites… SIRI
US XM owns four orbiting satellites and one spare satellite for use in the SIRIUS system, with Space Systems/Loral constructing a sixth satellite for use in this system that is expected to launch in Q4-2011.  It owns five orbiting satellites for use in the XM system, but two satellites inside each system are expected to have and expected end of useful life in 2013.  The company maintains in-orbit insurance for the FM-5, XM-4 and XM-5 satellites that covers a total, constructive total or partial loss of the satellites that occurs during annual (or multi-year) in-orbit periods; but this insurance does not cover the full cost of constructing, launching and insuring new satellites and it will it protect SIRIUS from the adverse effect on business operations due to the loss of a satellite.  Three of the SIRIUS in-orbit satellites have experienced circuit failures on their solar arrays, but this did not interrupt operations.  Its XM-1 and XM-2 satellites have experienced progressive degradation problems common to early Boeing 702 class satellites and now serve as in-orbit spares.

International operations… SIRIUS Canada and XM Canada are each interests of the company and these have yet to merge after the two companies agreed to merge in November.  These still operate as separate entities.   In May 2010, the company’s letter of intent with ACIR DARS Mexico to pursue a license to offer satellite radio in Mexico was terminated.