- Earnings call transcript Q3 2022

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Operator

Greetings, and welcome to Redwire’s Third Quarter 2022 Earnings Conference Call. My name is Zico, and I’ll be your operator for today. At this time, all participants are in a listen-only mode.

We will take questions at the end of this presentation. [Operator Instructions] As a reminder, this conference is being recorded. pleasure Vice your Investor President, my call, for Relations. now Taylor, Nicole Financial is to host introduce today’s It Operations and Ms. Taylor, your begin you conference may call.

Nicole Taylor

XXXX Welcome and Investor seen have Relations in website close, release, yesterday our Redwire’s morning, and you, issued earnings We at everyone. section we after Thank third that of good our quarter redwirespace.com. the afternoon earnings which you it call. hope posted to market is

make may statements during predictions the call, our Let expectations, that me remind beliefs, management reflect everyone that of Redwire the forward-looking intentions or future.

to Our forward-looking statements and are are on subject described detail in slide X. risks more that uncertainties

our discuss and see to our the earnings reconciliations. extent we the on calculation during or slide for these of non-GAAP website Additionally, GAAP the measures X, please call, release the presentation measures investor

previously am As Financial Vice Operations President Investor Redwire's of Taylor, Relations. I and Nicole mentioned,

and President Pete? Jonathan Joining Cannito, to Peter me Officer; Chairman would Pete. I call Financial Officer; turn and Executive today's Operating like the Rush, over call on Baliff, With that, Chief to Chief Andrew Officer. Chief are and

Peter Cannito

Great. Thank you, Nicole.

the who today's then and be highlights start the with a for by Andrew, will open quarter. our he quarterly then During for will Jonathan, floor After who present will third call, the followed we operational the highlights for by me, will present for finish presentation, update we'll followed quarter, financial Q&A. we

that presentation closed figures this unless all please do include as I Before Space note, in acquisition acquisition in NV our not begin, otherwise noted QX. recent of

please. Next slide,

and SWOT this we NASA solutions. mission mission will the observe components the that month that Sensors the I'd developed in JPL. critical providing planet presentations, the first oceans. measuring to to reservoirs is navigation is will On of enable actual Redwire scheduled height launch or waters out missions begin, Redwire by satellite on called Surface Ocean mission the point and satellite as this slide it this like lakes, are quarterly be nearly we Please all Before Topography and water the next slide, deck of with X. imagery rivers, is SWOT X. that Water have all used Sun in turn Earth's slide December use surface, on to traditional to

talked budgets focused we race domain. the space with we previous about stages This a on around for in Europe, and with increased on As landscape multi-decade in larger driven a as defense the calls, agencies early space governmental national competitive has global notably world broader are US increasingly US space. space the of new at geopolitical increases

and sequential expected to to commercialization selected was Redwire at as digital realize we that ability space structures, on with regardless, However, I our in launch beginning recently NG-XX flight in for space provide avionics Most am space XXXX, engineering. the of of as and on despite well the This quarter, addressable to mentioned $XXX.X and to multiple which our immediately Space award bolster broader expected These significant platform. chain total successful a recently, the CRS-XX, are power recently increase markets deliver which SpaceX is as the XXXX, for delays growth a XXXX. in of disruptions talent SWOT, X, an here promise and selection acquisition supply to the company. QX present award. revenue with combined is in NV, today that the have launches contracts proud access planned as this QX Redwire strong slowed tight demand, continues JPSS-X up backlog our upcoming contract including to which after planned labor Redwire. launches some subcontractor experienced and market report have slide. of Artemis from and fourth quickly and and delays, ramp-up previously Redwire human million the and backlog new and systems is $XXX expand of I resulted increase in include that for to earlier growth opportunities historic in multiple backlog million LEO navigation, These increased opportunities to of land a completed QX momentum for But scale, level

the you So third what's a the quarter bottom turn today, it as see Please improvements update revenues, was we margin, in total sequential backlog. adjusted gross to successful X. EBITDA line across will upfront, board was in saw and our Slide

in EBITDA to over streamlining $X.X XX% to overhead in free of million continue X.X% another XXXX. up streamline percentage and in cash Red the in million QX on basis cost over which comparison and negative focus achieve quarter-to-date and QX resulted is SG&A XXXX. in $X.X a third costs to XXXX. Specifically, a on will We sequentially the to compared QX QX pro quarter, reducing and XXXX negative momentum operations comparison year Focus anticipate in $X.X gross by wire we and improvement million margin sequential in operations forma in This XXXX flow on adjusted XXXX XXXX. in QX sequentially. positive efficiencies in to Efforts the continue increasing QX a resulted continued prior of to was X.X% revenue XX.X% saw revenue improvement sequential as XXXX. to

during company together continuing we strengthened to Capital the investment of in future as Bain to quarter, to was Additionally, quarter used Redwire's finance million preferred achieve form AE A the a who our of Partners, growth. improved QinetiQ of XXXX, the to $XX and in balance the early increase total convertible Redwire as an Space momentum, acquisition fourth sheet bookings expects made backlog. NV The and with by stock is which building an Series Industrial fourth investment well support

full anticipated a approximately previously the guidance I and a Space revenue Space EBITDA of in updating in range to XXXX adjusted acquisition million include year from quarters. guidance the negative market Please However, negative be is $XXX Slide award the and have turn be provided mentioned NV. subsequent in $X pushed to execution labor delays forma million Redwire $XXX This does to of talent of contributions million. for tight $XX contract X. pro to and in into Therefore, its range not million revenue

a and time significant solutions support exciting product for standpoint, and offering technology, to to supporting well multiple widens growth. at Redwire’s growing Redwire like apertures space, growth significant and just small of instruments, Redwire is top includes berthing scale Their backlog Now profitable Please profitability. Europe. platform both leading very and which the space Space and European satellite equipment completed both markets, this opportunities complements a global acquisition multi-decade Space core NV a offering, addressable contracted the is all access a an are current space Redwire's and access position Europe. Their when This in adds programmatic turn it heritage, US end-to-end as Agency. to a with public from increased with NV critical we as Space important to financial provides Redwire Space and infrastructure in snapshot from space to to is budgets expected of technological pioneer NV industry our QinetiQ. XX. and line innovation acquisition flight focus broad significant provide much Slide docking and and

us and and innovative Belgian than increase in Europe and funding across is QinetiQ capabilities enhances customer, platform us and XXXX. be infrastructure innovation in Office. renamed will critical meeting Since and addressable with that, international demand Science of business numerous Luxembourg an more on will increase it NV's the budget operational new us quarter and it Space Agency highlights. The the area expanded company their global Redwire business an space submit positions to in combining company's in market Redwire European the the a three-year from to including third to with they create with scale a submits agency our over Redwire Also, growing. N.V, provides offering Belgium to provider be proven space European on Europe. premier three Space the space update for acquisition, to years heritage, for secured infrastructure Andrew exposure with to high-growth agencies. backlog XXXX. strong very I every deep flight with Joining build anticipate total and of the Policy a Space we our Space European ministerial This turn customer a space our product relationships space expands gives NV we XX% upcoming with the The budget world's request -- to in of And and have decades

Andrew Rush

Thank you, Pete.

alongside the an LOFTID LOFTID point inspected get shield technology like satellite Before out the this we inflatable being later I'd quarter, of heat demonstrator to is see for demonstrate this our last is recovering as preparation launch Please to for useful in here technology set proud details the to image. What you month. be JPSS-X a in this the a recorder both economically for Slide space to have demonstration. rockets. infrastructure data trailblazer and economy. space well provided We both for on XX. deployable next-generation cameras continues turn to Redwire landing Mars Redwire as is into

products performance, perspective in driven on-time continues demonstrate well delivered a in of gross our excellence pressures to compared and more despite mentioned, execution and chain as by as margin through and both QX XXXX. subcontractor from early QX solutions to headwinds. to Pete of and delivery revenue operational we continued QX perspective As progress and the XXXX, compared Redwire supply macroeconomic operational

a few XD have recently, other expand rollout optical NASA's facility Redwire moon. supplied As Station, components docked components a production successful which the this we the we slide also delivering XX this power for the news ADSEP mission-critical Test, Space historic anticipated the generation seen wings Advanced SpaceX and on Experiment Processor, investigate Redwire successful of capabilities a which people aid which morning the to facilities, this materials of the the Space DART. service will that was Artemis decade. that to the a orbit. you X International NASA's facility, built mission Redirection Facility is few imaging pair ROSA and to carrying Double participant to We BioFabrication advanced Asteroid technologies sensor many a Station, latter set know Space turn new Redwire with launched is and NG-XX update later half CRS launch And demonstration. ago XX. execution most call delivered augment some expand members, BFF, to NASA, of of on quarter testing full the Planetary arrays bioprinter, which military may Defense, in to second Please crop or launch navigation International days on for into of treatments research in with and

to like development them highlight a and many in since being have efforts success last business call. operational orders resulted Redwire for strategic call. team's I'd of our today's few Our on earnings selected

Power First, and turn to let's Systems Spacecraft Structures.

not for develop rollout continue Lunar We scale technologically solar to and Space space our satellites and solar International and Gateway. Station arrays, deliver both applications, small rigid as panel arrays such craft larger differentiated but the only patented NASA's also traditional

solution more a lunar future move. on robotic in seeing as turn customers to and missions for ROSA also power human are the generation of We to support the exploration surface

and Array for to a solar are are in the any systems satellites Station part space commercialization system. begun they but nearly Solar future. portion SADAs With satellite in successful robotics, making multiple on Assemblies organization. power system. compatible are to Drive and used expertise of our spacecraft's we set arrays work are have which programs, This International array securing significant Solar been of spacecraft enables and systems power lower and opportunities every recently us spacecraft other only platforms have SADAs. not and satellite power we in to capability today, or piece share commercial offering in operating Space respect key the systems to product orient orbit human-rated multiphase of expand the our expand Building space power flight, on a across the on perform the in spacecraft distribution human work we power

stations. enabling and innovative outfitting technology future commercial of heritage development is and Our space design,

solutions. our Sun multi-ship and multiyear in providing success for Wins large and had navigation, also increased momentum avionics, have programs. Tracker We here engineering are Star Sensor

XXXX. QX backlog analysis, strong We developing of engineering total and of in turn static and of to of thermal the two critical contracted a design initial are backlog That million slide million as consistent backlog was avionic and of by our as QX XXXX. outlook as XX. our Contracted with is up constellations, QX stood is is to end relatively also long-term $XXX.X support. sequential for load $XXX.X Redwire's quarter end momentum. There pipeline $XXX of increase acquisition that into provides anticipated historic a software additions Please our does with million backlog commercial healthy high in at supported services XXXX. confidence and growth and growth Space take the as to testing, testing further Also which demand and for total note the NV. XXXX, a is not this contracted for us. backlog of This XX.X% represents account from from consistent

Our billion year-to-date beyond. bids. in provides X.XX million in four is our approximately of a tailwind of submitted Space with and a quarter a pipeline XXXX book-to-bill have for year with Year-to-date, we more of this execution opportunities. us shown growth opportunity available, in as strong than $X.X in of tremendous amount market $XXX

third to over selected our for million the We are financial next in in I Jonathan? six summary have $XXX.X approximately a that now to expected of quarter and it be months. will results. bids Jonathan turn submitted

Jonathan Baliff

spacecraft mission All recently to Arrays, expound Arrays But Redwire themes XX team which that XXXX Andrew just highlight, spacecraft of Andrew Similar of I me our talked here, in and for one exciting, XXXX, but quarter, the you, Solar and members on let ROSA the September successful quantify slide a I do, right. a bit Solar outstanding XXth, XX-foot Arrays will just Dimorphos the that for two the talked about. the team Thank taking impactor Earth. impacted in prepping the Andrew. DART bittersweet help for just see for number for Pete last on Planet or to about, on before our

back leading key Redwar few growth accretive total And revenue high-levels. performance, even add standpoint. but these quarter after sequential financially ramp-up proven infrastructure just XXXX saw points. sequentially, year-over-year this customers, get a reiterate, ARTEMIS, NG-XX approximately takeaways. these some creating key very to growth and Redwire the Two, Redwar for backlog million. liquidity and fourth our Demand transaction, NV revenues the look Redwire just critical on XX% M&A revenue performance into continue to grow Space be Three, and it business, execute of are the increased its rest for in year this the XX discussed to our proved backlog. for of XXXX. chain financial fiscal our to with our our finally, a of in year streamline balance to continues slide to accretive supply is financial on Four, to infrastructure to the financing turn contract Space NV at for total direct sequentially. stability. revenue exciting strengthening will Let's capital in with growth, spoke $XX these, growth leverage One, and Bioprinting continues will DART, I year-over-year Pete awards operating backlog, capital, just and we of and is previously more XXXX, the our business when quarter as the historical to fiscal at our total and is is third with XXXX position quickly, go financial $XX.X quarter a million third that more year-over-year over the just future is specifics delay expected for and from in sheet addition with due factors Revenues you higher to about. additional And provide some that quarter for

revenue we sequentially where percentage X.X% the delivered adjusted X.X%, increasing trend an in better as sequentially. profit better We this last of quarter, to also increasing operating performance third improving quarter leading revenue continued XX.X%. a leverage, With EBITDA and is financial gross

XX.X%, power avionics and components generation infrastructure, we grew especially in our deployable solutions. as Andrew for and increased as And as navigation just backlog total well structure saw Our critical about. spoke demand

this space, our performance Industrial proven NV, to with we also investors joining existing Bain us acquisition October management our importantly, XXXX. working meaningfully of add financed closed our in investment quarterly the by pardon multi-asset in demonstrated to with in provide cash and $XXX capital to million fund is leader we October a Capital, and in joining of AE growth on and and up and ramped the a the total compared quarter operating sequential capital. We for As total pun, but we will quarter Xrd third a third by saw the investing, backlog more more Partners, our total transaction our alternative shareholder, $XX employed scale to aerospace serve The acquisition scope in working billion was backlog, provide and the to announced utilized leader changed Space capital the on addition record backlog. XXst, quarter second improved

Pete adjusted shown already operating tight $XX combined guidance realize gross widen $XXX right change, that full in expected revenue has our update award delivering ability better operating talent impacts the improved better as contract positive on million is negative anticipated this will fourth the contribution up experienced have labor the These the delays, from spoke the year-end this we we the But has earnings does in a this Please large in also include market our be XXXX. the within with Consistent momentum, and and range million leverage, acquisition. this space It's this contract it Management remaining account $XXX believes after total contract taking subcontractor about, -- fiscal chain supply commercial those awards slide for Finally, is for year and infrastructure large and Space quarter million. to backlog. between could there with for we performance fiscal not Note, revenue. recognition demand you the strong, remainder financial are as we quickly And our NV XX. operating $XXX be are turn Consequently, revise ramp with year move our management on and revenue quarter. about, to will prudent pro call. also even revenue and to of contract for And to for delay margins talked leverage. slowed swings to and a the that XXXX ranges range to to XXXX $X meaningful tied recognize start selection. EBITDA negative third But forma we million. ramp-up. space million into revising disruptions, to

the bit basis in customer to XX.X% revenue a million and call, based base. and left, This will These diversity the the sequential third delays year-over-year offset our also increases combined the modest what increases the to in increased XXXX space contract the third part Redwire's mostly in more another base our I these labor tight already year-to-date XXXX. X.X% As this a quarter we shown business start decline on to solutions' into revenue and the and the EBITDA into to and the to anticipate the declines manufacturing quarter turn we security in delayed XXXX Customer account quarter year-to-date GAAP on the $XX.X that by small a right more quarter one right, left using These third space about. our to provide first then and increases revenue detail basis into a meaningful engineering XXXX. to show on looking quarter to chart bridge to on comparison we across is as for second the XXXX attributable to lines million the deployable provide of wins year-to-date XXXX, using first revenue second we on concerning Please On performance shown will customer are in Redwire's Similar quarterly And commercial sequentially. Redwire want bit fiscal is to that detail to attributable with sequential allows move and with taking third September, due left, with market a last the small of base. quarter were of of XXXX our fourth quarter, third quarter a latter our spoke want We absorb $XXX.X the slide gains in customer half are by on profile basis, with a improved from customers. XXXX. showed in customer that revenues and similar then at year quarter. quarter our partially quarterly of you'll a right. see, civil improved attributed and in-space the revenues half move When growth of year-to-date base programs see half XX. national adjusted

left the EBITDA of chart, of the the bridge On a quarter third million an year-to-date $X.X by third was $XX.X adjusted in EBITDA comparison, revenue loss been XXXX EBITDA to positive XXXX. growth impacted in the adjusted year-over-year decreased positively quarter for from Adjusted million we've talking year-to-date additional about.

with positive momentum book-to-bills a million the the revenue in and gross see third quarter second attributable compared a that to second basis. to continue and third XXXX neutral this margin we're $X.X contribution of We higher the is of And on with XXXX. seeing quarter

to million, Our we spoke last to business first negative quarter. about gross but million declines about, $XX and investments impact of opportunities made by driven costs the in negative that year-to-date is expand XXXX demonstrates our and quarterly impacted R&D $X.X have the the helped company contract operating gross that Redwire Pete public next size backlog, as is gross the the our to the and expenses it in quarterly talked and year-to-date operating and the a in margin masked a quarters, the will improved on year, on expenses half second in focus also has margin, streamlining earlier XX.X%, fact third but which bar, margin we a addressed this on bar, the critical the occurred shown began the deliberate Pete on EBITDA. XX.X% led continue Most we first quarter more $XX the and This programs. margin in of as second basis. see this improvements deployable in of and we it you up of next to the quarter, million so. do can in attributable development, was business in quarter Similar excellent result second components was the as And showed engineering XXXX. solutions our sequentially, over what and

on We these are focused costs.

in absolute third of the note, is $XX.X to of $XX.X quarter million on from second the third in XXXX, basis, XXXX. before this million, quarters bringing SG&A an the As of an in XXXX absolute lowest on and five in $XX.X decrease million That's the a NV. example, quarter we Space reduced quarter and significant

On from the just right chart, quarterly to this and third EBITDA quarter the quarter the adjusted back to about improvement sequential XXXX almost our operating into cost. coming company due second XX% leverage of the demonstrates on I've focus spoke the a factors

see new spoke mix, much space programs the better it gross and about, in that increased wins, our higher can You gross Engineering margins contract margin. Solutions we contract of deployable

will the basis. on continue Second, overhead and past months XX basis streamlining drive the an to SG&A on absolute even down corporate the continue investments percentage to a of following

Please third is turn SG&A slide margin on Our down to to that. XX.X%, to quarter work XX. going a that's at and but continue we're now year from XXX.X% ago,

and a flow third balance for it cash improvement to the finishing over I update free with turn discuss sheet and Let's liquidity up liquidity quarter Pete. before

on an unadjusted told call. flow free on left-hand we -- flow, perspective in CapEx would from we told second on of As management the flow, and free the quarter cash operating cash about we Free provided you cash flow basis. as chart, we second disclosures updated now quarter call, the did show as minus is concerning the we've cash the do we

free quarter XX.X% that be to of as three, XXXX flow impacted reinforcing and use But expected here. to a beyond. capital million is number So was many And revenue and cash investments to cash on cash. of higher improved general received for cash $XX.X management It in in supply the use Redwire quarter the third the cash impacted a second did sequential of We of to of see, sequential finally, We're is free platform. from our capital you was the continued benefit where improved fourth due contract use was and XXXX. by in use can compared cash. XXXX to working of was improvement better by a operational the year's ways third cash two, last see of One, million want margins. accelerating XXXX, is factors. $XX.X cash it improvement very quarter Redwire quarter see in build gross the it in the chain. awards, And focused and we cash

we continue our to we said, will streamline business the momentum. as continue revenue As Pete

On we XX, about as NV, October investment of the – of and $XX liquidity million, right in XX, this our NV. of a the October this October in with totaled chart, completed an announced to cash X, borrowings XX, comprising we which talk $X availability Space quarter, $XX we has for Redwire facilities. on acquisition XXXX, slide. entered turn million acquisition Space the company million the our in combined of On hand XX. But which I'll slide show June changed October available significantly the renamed On Capital QinetiQ NV. the of now credit under $XX million Bain on next into investment Space agreement AEI and Please

be zero three effect the assumed synergies One, Here EBITDA and calculation, the are in for financing free accretive is expected to to and after with this transaction cash flow upon financially adjusted closing. Redwire’s takeaways the giving to this. immediately

Second, Space features top NV growth has a experienced profile. very profitable line financial strong and

AE this talked of from million. ended recorded that third But update million shows profit stood rose fifth of Red contracted before, XXXX, at more investment on On capital of suspension As of favorably benefit to funding, entered Redwire's agreement said liquidity this $XXX extended and and the a backlog, maximum the an by right-hand we quarter XX, consolidated X, NV will to as for Agreement, about, XXXX, million fourth March since in Amendment historic is during part €XXX ratio equity apply taxes. we balance credit a of closed, Street million the the things, a of and backlog, for Look ratio costs additional from €XX Three, Partners. a €X position. company's improving NV the Bain related early into Pete our aspects. which This The quarter requirement after $XX the leverage, current among XXXX. willingness as the our XX, important Redwire the year Space combined this that XXXX of financial November in company. have and Redwire of purchase resumption high Redwire in with total Space total adds financing revenue sheet, net following as requirement. puts number transaction Adam concerning NV's leverage This Credit the the of stronger of Partners expects Fifth Space year tripled to other Industrial first the liquidity much This to at than amended working directly Capital quarter. chart. Concerning March the million the and after a wire the Capital

They continues XX, capital can confidence represented Street a rode building in Redwire's access Adam as of it bring liquidity, vote Space NV critical in our you and final two have have great proven support our Redwire a provide reputation a capital to as So record strong them. table the proven are critical close Pete? profitability. with of commercialization strategy providing are of strong for to position, the many as as clients we track over to Redwire turn by strong see, comments. industries total raise of to the the space provide a backlog investment and others. to during purchase in the of need leader to slide enable these space grow. their fund future avenues both in will This well and companies, proud success above I growth aerospace turn to and track partner infrastructure Please quantity and leaders to and financial the allows to The balance period to price we of Pete strengthen when its to of Redwire growth and were sheet projects. of it to and

Peter Cannito

All right. Jonathan. Thank you,

exciting subsequent busy a occurring third and with QX. recently wrap-up, notable to So early very events quarter in very some

set contract station. even impacted recent weather to we're present, be that growth in are and XXXX printer, away. The of iROSA created today. our bio Solar generating Here headed a year-over-year delays high to NG-XX, the these Arrays backlog in launch revenue the our that take guidance. going Artemis carrying that revenue programs, want which improved Andrew the next SpaceX to in Most quarter. customers, to in importantly, in the international future, but deliver Redwire was points the the with others space different are CRS-XX, the the cameras and our you number performance are permitting have our quarter we sequential successful on XXXX of for third not talked about financial continues here ramp launching are which up performance this on and financial of These next-generation

continues grow Next, total Redwire backlog. to

that times total myself, in for our a and of leading couple Andrew historic Jonathan a Demand backlog. our from it infrastructure heard is You’ve we this growth. high historic head to

continues Redwire Thirdly, scale to accretive platform. financially our our track successful acquisitions record of

to financial and performance acquisition. Space growth that, our balance of this resulted just And from fiscal AEI. strengthening NV Q&A. leverage covered as and We resulting it in the the accretive in NV, the approximately sequential over future I the industry for operator detail, as financing industry is in this turn Capital great this the growth of with about our Bain and to for we with will for We're with highly into in capital -- rest XXXX million has XXXX. $XX quarter This business Redwire get this Jonathan Space investors, This year inorganically. and capital increase an add with streamline will and are notable total addition stability. revenue improve and respected for backlog. unique finally, ability very additional our now grow will more liquidity is And for operating its And to our sheet excited position,

Operator

you. Thank

We is Our of the [Operator question line Instructions] Jefferies. will a question. with session. now Greg state Please be your from conducting question-and-answer first Konrad

Greg Konrad

guidance, final begin, Good there ago, the it the less awards then the that, updated guidance, Space you two You with been Is variables? revenues wide mentioned labor, wouldn't And NV. morning. to reason about for end that you the mentioned nothing could of supply what like of the but a driving tied Maybe months Can than for talk to that and two has at on maybe contribute that, be QX sequentially. just biggest range year? performance, to are months chain just year? seems mentioned down low you improved

Peter Cannito

how Yes. Greg, great question. Hey a Yes. are you. That's

I So question. the appreciate the --

factor biggest up the to So historic highs saw, is really, we're ramp contracts. those hitting as you in is ability backlog on our

to subcontractors the orders individuals get fulfill our hire in space running on two most the well and our top out in that we're recent industry of award, hit You to talent for the as those to as our up quarter. ability running as mentioned, the fourth demand the getting and contracts we time

It's remainder any have backlog we with NV of quarter, our most really a and time demand forecasting But, It's of months So we're how for to going and ramped what's ownership will of the call. to products the be run up fourth about us. solid quickly of as revenue part of the not earnings NV really the the year, during variability. predict services. we driving not ability in the lack -- Space that's considering in plus early And quantify QX time early, the to under notably, deliberately, our Space that will in NV be closing the able numbers with we included Space our ramp the happened of the two remaining the for up additional for certainly -- their because year. NV, in have next our probably Space will but bring

forecast remaining and for So these the upside any us. year that. projections all the do for That's do not not -- of include

Greg Konrad

stress. across been mean, on inflation how quantify issues, does aren't can wages those we've and trending? the then requirements is of labor, maybe what impact been maybe numbers? way it that's you, how some think there unique hearing to and the the about obviously, you But That's then And suppliers. any I helpful. to And and labor are

Peter Cannito

question. good very a Also Yeah.

quantitative limited fast. a growing So space There's -- any industry that is But data prepared share. we there's we've again, to don't have talent pool now. right

out competitively projected. we longer and is taking had people there So getting previously than hiring

into with to revenue to to We are subsequent comparing our quarters. it is growing. hire plans that were It previous pushing what just has ability do

So slower. ramping up we're

have but put little that So point our we this a longer -- yeah, we take at recs to out it's -- more there, fulfill. qualitatively

and industry, the probably on in but at be any just inputs, it now, increasing next pass have both in numbers also looking concentrating macro don't to ability that, our to in only everybody the the right call more environment we the I very of watching are inflation think look not an increase our share and sides have along our customers. cost going we're to but like to we'll closely, coin, that we at from to but prices our

of don't more we'll year. that? a a Jonathan, if note QX I talk next add that want anything take you have you So on bit little to in to know, to

Jonathan Baliff

into to good it higher a know we standpoint I we some what internally, bids we just taking our internally, newer are gross that numbers say, want not can Greg, And account. other assured, prepared let's many we just do. from are of rest and what to There of you're margins know of have what very starting mean we things asking, to are see sense competitive to talk aspects the you're contracts we about. and But contract the do.

It's happening. it internally, number for just happening we're prepared of call to disclose it's reasons. a So this on not

Greg Konrad

because about, in both stress there commercial mean, the contract maybe and then, side. I is way And which any was talked delays to characterize other you government awards have you the

commercial government of wondering the issues. like you some out between how and that issue it I mean, commercial? when you a do seems Just those government is maybe if think awards, or there's break on funding kind about side, this

Peter Cannito

I both. same -- trends in mean Yeah. the it's seeing I think we're

level new innovative there's programs their variability funding. they lines. depending starting are government as the actually I increases capabilities on in opportunities that of to space they're Sometimes, combined the just a of and that lot But And are different arms place, and commercial of get their companies believe in some it contracts their time around. that put planning

with issues with own are. dealing They're and they're ability the to subcontractor So dealing things ramp the They're with same on supply like. up the their we dealing chain staffing.

Andrew, know, I anything government that? So have want contracts. both and it's board don't you across add the do to in you to

Andrew Rush

Yeah.

said. think I that's well

about we pipeline were. most in through talked previous down as kind seen awards. commercial of that our of have our projections anticipated it is we've on the seen come we've calls, and As earth to their folks of side But back things, flushed have

funding being commercial awards to up right slip is ramped programs our the hitting than ramped getting contract their about getting to So driving really what their availability. customers Pete was thoughtful on terms in of and teams what's more rather up, execute

Greg Konrad

bit the And and backlog it's M&A? know you one thinking at and mean, year contribution looking one that then for backlog, puts last from total some this of are how maybe little just headwinds just about just I kind also early, year today, mean, a me. but but I of growth I given some next takes

Peter Cannito

absolutely. Yeah,

is already and the mentioned We've historically headed. So I'll million specifically it's really times, of hitting we're that looking XXXX. continue. are customers that slides we're our multiple bids we point numbers $XXX backlogs, into These Andrew six at you four that the expect next a by one going of momentum to where we're mentioned I strong. $XXX on decision believe really We excited about award great within his high submitted. indicator that an under have, believe, expect to evaluation million trend we in months. the we

another the to So against work the million and in on expect that six backlog million we $XXX months. already next hear we can from books, that $XXX

to So year-to-date that's great times momentum. book-to-bill. I'll that, our X.XX add

to our book-to-bill So executing our than growing we're revenue. for We're faster grow. year the continues

very as of recent this backlog. for you really which for we momentum have, solid have audited better as the There is or is to well, the we year. most indications going And that Space XXXX, information the another NV So mentioned into in number million -- great XXXX. March had in that's then €XXX that indicator

So we know also great growth. experiencing they're

momentum, to our that about well. XXXX the bring finish significantly then their in can with and increase ability different we as XXXX growth increased synergies part optimistic table to of that and we're strong specifically to acquisition the there as and Redwire enhance So

of our numbers sheet, in next strong the we're talk our that, significant about indicating have positioned. indicating to we'll again, XXXX. on are really But And momentum more call. balance really into with all liquidity are improvement numbers going the So well the

Greg Konrad

Thank you

Operator

Thank you.

ahead. Please from is question Moeller Austin next with Our Canaccord. go

Austin Moeller

and Pete Jonathan. morning, Good Hi.

Peter Cannito

Andrew is here, Austin. Hey, too. And

Austin. So thank you,

Austin Moeller

Hi, Andrew.

Andrew Rush

Hi.

Austin Moeller

first my will So contracts, included contracts inflation your in in impacts contract the average future the mostly programs the government question backlog? of enabled for be to include what's in that existing a or Redwire here, has length you And

Peter Cannito

Austin. Thanks for question, that

variety contract government. a of with have we the types So

have We and firm the fixed contracts T&M. price contracts, cost-plus fee fixed

are contracts, just fee -- also those very fixed cost-plus those the the On I our and to and inflation. very impacts T&M FFP are to mentioned. the -- similar as CPFF, On our due seamlessly allow any to collect contracts us

are the more responsible contracts of price because versus FFP changes contract fixed we in a On any bid. contrast, the firm in for cost

impacts. previously ourselves our as insulate our insulating established, to subcontractor try contracts getting on many subcontractors as early much possible us that by and in so against of with have we from contract inflationary locked on at However, prices FFP front already contracts

we we and upfront account follow of things the a rigor We impacts our also milestone also on in where continuing -- cash inflation going FFB introducing our payments appropriate. bids. cash contracts practices to introducing where -- in of are terms think our into we being bids, taking best following level get are industry as to going the our cash stay level forward on of are ahead in as well And about thoughtful of and

Austin Moeller

was that in of just given you which upfront customers, contracts Great. touches question more And my just sort cash planning where future factor next on collections are that on Okay. with -- at? we're was, to

Jonathan Baliff

Absolutely. Yes.

Peter Cannito

Contracts type.

Austin Moeller

color. the Yes. for Great. Thank Okay. you

Jonathan Baliff

generally didn't It's question length. contract years did a our We you three Austin, to years. answer considering -- ask X.X

we in XXXX seeing to getting you're more about is in. that how by even the just inflation certain think and on bake reprice revenue there And the an ability contracts momentum and into So way. XXXX,

Austin Moeller

Great. Okay. very helpful, Thanks. That's Jonathan.

Operator

question with proceed Please Riley. B. is next with Our Instructions] from [Operator question. [indiscernible] your you. Thank

Unidentified Speaker

Hi, there.

a quick me. So just here question for

difference how then how what's could? you own to employees? you versus subcontractors if And So your in you guys fulfill wages -- do orders the are much there, on much relying currently

Peter Cannito

is Yes. Hi, are How This you? Pete. Kat.

I obviously, we So we for But employees don't competitive disclose have reasons. now. that believe, information over XXX

rest a doing of we're Redwire. fair fulfillment So assured amount as

Jonathan Baliff

Jonathan. It's mean, spoken I not Kat, in you've past.

to I it – to don't Let that answering Kat. way add me just want Pete because we the

to have the for you do economics, XXXX to out we unit analysts going a model so economics of other to unique that the you more you right? nature to a spoken in able the granularity. future, are and to to you guys We provide bit be be in able guys We want can little create

obviously, to balancing, because we're prepared of Many contracts part for do our up exciting margins build. that. to those We frankly time critical that and right have you're more disclosure those trying us control of do backlog and We're particularly competitive to more have the and able get not over This is as satisfy with the be are to now. that them obligations seeing information. the that a momentum in

those it we're to XXXX. internally in got sure. with on but just you us, So be for We unit disclose economics to to able bear just

Unidentified Speaker

been Great. All and Thank of not -- wasn't give or color for delayed it understanding those just if have you limited contracts you. That I awarded awarded yet. any be were or right. proposals I correctly, sorry then -- Can there? missed sorry, but not so you kind helpful. And would contracts

Jonathan Baliff

were up ramp time due in up. some with primarily quarter delayed with have We orders have -- and were in had It's delays three. that quarter million this into quarter The also contract came associated remaining contracts in we the in on the ramp had to change to really increase two about delays expecting and into contracts, we guidance talked backlog. we've on $XXX to is inability the just third previously were about we calls,

in our that on now quickly in And bump analytics going And our we be try on at to now up remaining to backlog. seen revised how are execute. we're that. the able have up time to and execute ramp to to ramp looking our to You've determine we putting based

Unidentified Speaker

then… Okay. Great. And

Peter Cannito

We're Kat. it. prudent, fairly prudent fairly being We're being

Okay, Kat.

Unidentified Speaker

me. from one final a just then And Great.

areas new share? going kind that like total so perspective, directionally So you what's from there's are growth, seeing of number, a of can pipeline new any $X.X anything on there, billion that I you if guess,

Peter Cannito

the not organizations And there's seeing picks in only we the space we also digital has so our antennas, these things long-term. to near-term shovels. engineering, Space what incredible both is – venture of like mean often for Blue we're building on and call commercial going a of like we're what the actually I blue-chip are already to International started. with seeing demand to going present in LEO, economy a but seeing and on power, refer in the over in stations be our an built planned is referring growth for near-term like for currently that as And in the then foundation future, We're Station, currently program near-term foundation capabilities every across to We've opportunities really shovels need offering. we because, entering decade, we're towards the a as is move where pipeline planning. blue-chip avionics, that their demand the and really have are Origin lot we great things orbital that picks to reef also our the next space that now great that step-up our demand the These optionality. and are that coming and good Yes. about be these board, lot talked going

to the general blue-chip shovels then, seeing the entire demand are we commercial These of bio they associated because grows. are of and across future are ISS board, signals that the today. there's technologies really have, foundation for payloads demand venture are manufacturing, So space picks space strong We as optionality capabilities. the in stations. populating And the our are is that one-of-the-kind populate the really our course, demand the in-space like that our with going capabilities know strong,

to uptick well. significant see in that a You're area as going

Unidentified Analyst

you. Great. Thank

Operator

Thank you. Cannito, would back There this over for the to closing are like to no Peter further I time. floor turn questions at comments.

Peter Cannito

forward everybody of the excited Space work about our joining everybody, third for call today. future – the do, results, future. about for like sharing to just to we acquisition the NV's, Yes, you, in thank more joining information our to I'd today. But we're and thank but looking We're very have quarter

Operator

today's concludes This teleconference.

may You disconnect Thank time. for at lines your your this you participation.

Redwire (RDW) 9 Nov 222022 Q3 Earnings call transcript