Earnings call transcript Q3 2022

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Operator

Hello, and welcome to today's Terran Orbital 3Q 2022 Earnings Call. My name is Elliot, and I'll be coordinating your call today. [Operator Instructions]

I would now like to hand over to our host, Jonathan Siegmann, Senior Vice President of Corporate Development. The floor is yours, please go ahead.

Jonathan Siegmann

Elliot. you, Thank and Quarter everyone, for Terran joining Good Earnings thank Call. Third XXXX Orbital's morning, you With morning Hobart, Chairman, Chief me Bell, Executive Marc this Officer; from Terran and Gary Chief Officer. are Financial Orbital Co-Founder, provide then will and will the quarterly Gary a highlights review and Marc for update quarter, results. the business then available answer executive questions. your Orbital’s Terran be team will to

are and and During based on are Many today's These assumptions, as cause to statements. and statements actual call, risks on we forward-looking differ forward-looking may call. subject a could factors materially result, current uncertainties. statements make expectations to this certain events our made from

on For more are cautioned website, to the and obligation to the company www.terranorbital.com. put information refer not Securities the on any reliance be disclaims any the these to call. found discussed about statements Exchange and Commission, uncertainties, update which forward-looking forward-looking our please filings during may this specifically of statements, with and Readers company's each undue risks be that can

Please that call. information financial to on refer also certain we today's note non-GAAP will

with can measures the it With to I turn reconciliations most comparable our of press non-GAAP that, will financial measures release. find Marc. over earnings GAAP You in the

Marc Bell

thank you highlights from third the Thank your you, be strategic Then strategic investment million and I and and latest on operational everyone update take new Gary then financial detail results our $XXX for cooperation more Lockheed and good with morning, provide our exciting the XXXX investment, you for quarter, to in questions. joining and solutions to we'll will our agreement Jon, our partner, macro our earnings thrilled Martin. happy to and quarter am call. conference on environment our the results

serving Orbital for industries. United the you the defense satellite of States primarily is products, who Terran those For allied and and leader global in aerospace a time, first joined

and production space satellites. at helped generations prior fraction time work cost of revolutionize the satellite solutions of highly industry a and of innovative developing cost-effective the the pioneering by Our efficient,

million in we execute pleased For quarter, are third as XXX% the on a we to revenue, a $XX.X customer contracts. increase record year-over-year to report continue

was billion of Our of opportunities, $XX customer consists million, more revenue of approximately representing and than XX. identified potential value a pipeline of as backlog XXX September $XXX our

build Our on we manufacturing XX execution agency, continued the all of transfer and the to added transport has deliver space Terran year. satellites or remain to layer SCA efficiencies, end track SDA Orbital by office XXX head over XX. will months, XXX,XXX past space skilled and over XX square we feet in as count of and to of personnel our alone grow to manufacturing the September Irvine at development continue

addition, the be further be Space Florida, on planned in California. which In to advanced has originally and located Orbital's expansion will Terran Coast in partnership was Space Irvine, capabilities, accelerated Florida now with manufacturing been of

look macro to we As at strengthen. continues environment, demand the

more ever, Now assets satellite geospatial space-based to for and communications, are which solutions on intelligence. tracking U.S. than critical depends Allied missile and Defense,

of thousands the areas anti-satellite replaced a of initiated As satellites satellites. can advanced powers, network to transition are traditional to vulnerable has be most satellites, to of hostile have capability maintain Terran's U.S. and the These deployed which distributed will small that the weapons the developed. expertise, quickly particular resilient large of developed, become rapid consist

is situation geopolitical The dynamic.

transfer deliver the Russian XX Terran ago, new Development initiative. consolidation U.S.-covered threat as Russian to satellite weeks Just working considered legitimate Space to highlights escalated first the of that be X This by is layer. the urgency proud U.S. anti-satellite President, he to the X attacks. satellites of part Putin global for phases tension Valdimir Agency be announcing Orbital targets of satellite

space programs and National earth responsive systems, Both the prioritizing proposing significant programs. XXXX bill space Defense and bipartisan earmarked increases the be satellite Funds to houses In have are Congress, budget development low support tactically including development of in continues capabilities, and resilient space the capabilities. broad for of advanced orbiting space integration defense Act. Authorization research for and there commercial

me expanded in Martin Lockheed with our an week partnership brings announcement Corporation. of last collaboration to This exciting

Martin to satellite We exchange notes Orbital us invested $XXX capital, working thrilled warrants, and report towards accelerate has in-house are that million Terran and our production industrialized which up profitability. Lockheed ramp and convertible of in enables dramatically to path providing for cutting-edge our solutions

capabilities we Martin these advanced strategic cooperation and plan will ability. our funds Through increased satellite manufacturing to Lockheed a which increase opportunities space, to new pursue production use agreement, our also now run acquire leveraging with through we Specifically, additional capacity XXXX, capabilities. and assembly module new expand will manufacturing

market investment we of are at and solutions, customers demand to expanded for have our satellite We meet business. needs developments partnership accelerated and time surging With orbital turn now our demand the sufficient game-changing The flight-proven greater and capital delivered quantity. for in satellites customers. lines

capacity Orbital's market. time occurring Terran an are expand Our optimal in vertical investments expanded and its leadership manufacturing, at to advanced in growing integration

Our improve and satellites vision missions. capabilities expanded our resiliency partnership is anchored to costs, potential small Lockheed critical by of with shared of the a Martin security of national

investment. the humbled Martin, largest our are defense by trust We nation's space leader is with a contractor Lockheed demonstrating honored this technologies, in and and strategic

satellite and look transport working on and will deliver Tranche Lockheed to anticipate third be team future transport satellites who year. we SDA transfer our quarter this to the expected schedule. by cancellation the XXXX. defense delivering commend in critical beyond to enhanced layer delivery XX the fourth our tirelessly is Martin first competitiveness on-time deliver XX We quarter, to begin awards to our this in X the I As satellite expect we

to commercial in to solutions and technologies we of last we Under said, discussions are an partners. That pursue demand. plans radio in provide shift by own Terran its selling with And sell PredaSAR existing radar and a still This less in U.S. high week, way constellation. to Orbital options shift options, continue or us to direction. as capabilities. RF customers to our investment to which announced strategic potential building and today, require as Turnover engaged allowing while orbital PredaSAR, discussion capital to committed in much remains no will and best radar government explore XX contracts. customers product determine them with in U.S. at creditor specialized discussion government to constellation. a payloads Regarding investment, may is forward deliver longer opposed remain frequency a the unique on

to service component including defense-related We address also subassemblies core expand need offerings, products. as and and growing offerings, to to product markets advanced company's other adjacent satellite in and plan payloads, operations unmet mission the offerings

our automation enhance in-house our facilities, turnouts pursue suppliers on to and to continue full integration, us and towards outside profitability. will decrease We vertical path reliance enabling production industrialization, in

Finally, our demonstrate us, we opportunity resources about are Lockheed the within more our and our with In the ever at before sum, are disposal excited the plan. execute Martin, industry partner competitiveness on to game than growth our our of results with for not the Gary I'll progress, I and financials our it quarter. more for could over team. our quarter Gary? our an to that, With the be strong Hobart for overview proud now turn

Gary Hobart

as Marc, XXX% and record and on to million morning, programs you, execute revenue quarter, same for in gross that this the in year quarter last increase an continue third period momentum period we as was the well million, of million That's to of all-time report year. Thank happy second versus $X.X prior a build $X.X million. $X.X $XX.X I'm the the in delivering up quarter the profit over good $XX.X Adjusted year. same in the the everyone. in million

all through believe estimated production adjustments considers of million, by challenges profit this third relevant and supply quarter as XX related such September an reduced during which year. $X chains EAC the we adjusted known information gross and

loss to in expenses increase development, due Adjusted loss and loss administrative adjusted of the EBITDA result in EBITDA general a period year-over-year $XX.X million in compared and costs to the was of the profit. in second was initiatives, other same increase by quarter growth related the prior in million the and $XX.X partially The research gross for quarter salaries and offset and with $X.X million XXXX. a in selling, facility an decrease year as adjusted wages, operating our the expenses

warrants and X.X% on and as due XX, XX $X.XX, at where which price plus million Lockheed's an a the basis of debt a is Lockheed the is price of warrants on week, the from investment ownership million XX% September from as the in both stock, company, $XXX for turnover Pro exchange company for forma Lockheed's on strike $XXX for we converted October XXXX, Finally, Martin Corporation conversion XX.X million to XX.X%. notes convertible increases the last market. announced received investment premium to in in the

million well-positioned the Irvine. million including of million we our forma we and of million. liquidity, $X.X cash capital as of of to at gross hand for meet estimated on As from needs, XX, September near-term in had forma cash $XXX $XX.X believe Lockheed, received $XXX proceeds less debt is investment $XXX.X obligations. Pro million in We September expansion than expenses, pro transaction was company further XX,

are deliver convert and continue hand in on profitability. turn We an assurance capacity, on increase focused are over gradually continuing on to to products back our time positioned I will sufficient with to improve resources high and with now our continue well capital now mission Marc. production contract to to we awards

Marc Bell

operator. I'll your and to now you, Tarren turn to taking everyone, look Gary, on Orbital. of you, thank forward support over I and for questions, Thank the call the continued your it

Operator

of question America. [Operator Our comes Instructions] Ron Bank Epstein from first from

Elizabeth Grenfell

the It's Ron. the you of How the of potentially the SAR Could would for behind now? be satellites you think how about economics building, could color with what on Elizabeth thinking with around would you sort some you're them us margin give it be profile be? associated revenue many

Marc Bell

had we numerous discussions but it. responding having what We've about to looks before, we're begun pricing since that. like, now about conversations people have and inquired announcing We right now are new

should much, a clearer and it's the little premature a margin too by picture. about profile talk we call, stuff. have the to So next But much

Elizabeth Grenfell

kind would have you be that the satellites we I would think still mean, around do market XXX building? of sort size do of can be color? you think you any Or that So

Marc Bell

conflict center the the front is than probably imagery. greater I satellites. Ukraine need far margin mean really XXX put I SAR for think The and

there is it's there. of doesn't basket raining As SAR and you shortage that's showed the daytime true out Europe. that the either Ukraine And of a just is or know, And bread work. it it's EO

their frenzy. after own want potential It's own We've now had constellation. a numerous our feeding People inquire of to allies satellites. U.S. the

We are satellites. market ways far Martin XX definitely handle solutions to the and talking we this. about But can see we beyond Lockheed other other

Operator

from comes Canaccord. Moeller next Our question Austin from

Austin Moeller

Marc and expected a Florida satellites Gary, The year. question X,XXX one so to here. support number Gigafactory was

Lockheed think facilities California million said the you as Irvine year. XXX plans around to you will project put previously X Irvine, and operations throughput I you investment the $XXX satellites be out a keep do the in With what in expanding scale? can

Marc Bell

Correct.

next online up Irvine to on will it's that announcements to will that next comes with just not not facility as in it's later be quarter, here other space, So bring capacity, module about we integrate. production new up just space able We'll also It's to when demand. have the year $XXX assembly continue and the some million. us but automation keep vertically facilities

So more additional assembly space robotics, and we're of make to lot easier make spending to then satellites. order those because for on faster the in these advanced need engineering, a that of and money components we

broken it we'll the XX no soon. And the open. more would number, the time was through been have months in importantly, saw path get easily Florida ground have ground time So forward but to to it anytime breaking we X,XXX we would from

by adding taking let's up we're cycle Irvine, existing get them we're to space, in and it, facilities XX-month call adding here over an running. We're buildings,

of save of X great. that they showing We but Lockheed really years. we very determined we that enjoyed the market with faster. was Martin to need rest state the Florida move them X.X capacity The just is needed to So years faster. much, we probably working and

Austin Moeller

would the margin and sense. And Observation XX% long-term? assume Solutions for we as somewhere follow put satellites the Solutions? Satellite manufacturing like SAR opposed Okay. just to That within makes I still Earth between EBITDA should to up, bucket now would And XX% about we think

Marc Bell

yes, forward, But the core should it and you it just mean Gary answer will will want address second to It Gary, be be do segment. I will to be; the But first no answer part. going business. the part our margin?

Gary Hobart

Yes.

you on to to look profit. solutions as way So where but agree XX% gross try going the with to is to margins well we're the satellite for get XX% at adjusted I

Operator

comes question Stifel. from Rasmussen next from Our Erik

Erik Rasmussen

a clarification. just Maybe

and QX Irvine, of at the you'll you then of in On rate? run be capacity said satellites the sort that's XXX new

Marc Bell

Well, okay.

it's a about people little So bit a misnomer of when talk capacity.

XXX do can assuming we satellites So XXX year, a all are...

of course over XX about are a talking that You're the satellites the spread month year. out

doesn't that is our from satellite, X as it doing all because learned up SDA for within X, happening Now takes of we've happen, most the weeks. Tranche the assembly really space

in can amounts of like and of But potentially will month go larger a stable get so really year now, everybody that seeing the So month, time. But larger, a we we satellites XXX means do we now. are to at it throughout can one hovering if eventually depends if on space a month amounts scheduling. all be we overall our it we're wants looking it's much XX done, large XX that

And so accommodate desire. that's people redo of to we're how going planning how trying capacity kind our to now for we're that on

Erik Rasmussen

Okay.

So on bottlenecks? you but an that is could hit that way, some you annual those run certain bottlenecks of depending along of there's the rate sort how overcome

Marc Bell

just seeing real this satellites is feel that. a are out there Yes. at demand point. people comfortable of have thousands because it RFIs of for out that point, with just It's game estate at we We literally this a lot

we what accommodate. also our as is rate. us, capacity assembly, for add so big will work, testing we board, enable us we to in-house at testing, bringing the component throughput higher schedule can a look both a do across for more it for we on at change then and when faster also bid because And we're a which manufacturing But and to

Erik Rasmussen

maybe we Okay. for is a overall, back a for XXXX, assumptions...? couple we model the maybe to long-term but the the we're Are beyond be the then how influx, us satellite an where next are, thinking in the of solutions bit sort will, sort be in should sort of should you be of of layering but of those business in just of And You the about gave period of credits and relation little business? How thinking years? Great. top thinking margins, assumptions where at in model should about the on formally revenue? guidance overall up of about the the coming line sort some terms then we look sort the if how with on

Gary Hobart

Yes.

thematically providing So buckets. not from way dramatically is our in we're to quantitative our capital on the moving by it investing constellation. about spend own but away that, in guidance X going to think decrease We're

the the one all back to in when may made So would numbers update being major you process. use have deck [spark] we seen

and Solutions building will on I satellites the with change major think other in be the Satellite a focus singular division. designing

and all focus to capacity focus that, against orders. enables see to going You're that us on delivering of our energy

pipeline on the where we were So before, business. of looking side I'd going to quarters, our of announcement I and have higher But more through those where forward think, anticipate In are regard. this clarity amount our that and count a in relative conversion as unit that Marc and with execution we coming on going more we details will into credits I start to more our revenue on that going things, backlog, guidance about are. our where giving be X

Operator

Benchmark We The now Sullivan from to Josh turn Company.

Joshua Sullivan

markets. in financial significant interest your seen some We've

York Lockheed why as the a as guys about maybe Lockheed than prime having advantageous as the is more had is well relationship you Can just as others. investment, with talk You stand-alone? you a with

Marc Bell

us Because to is Lockheed Sure. to engineers the some start-up I whatever to aspects across for to to want we access although Martin do. assist some spectacular mean the we've years. imagine, been scientists to But at XXX,XXX still over we're relationship have now sit around and Lockheed we board. a

to mentor doing spectacular advice that's has the within. give it and should do a have And and value. how what helping better on throughout, our And the do right, us speeding encouraging and available what in it's Martin they and and like more they we're giving fit So provide us us. along been wrong we a having invaluable us spectacular that we always been that's in us and phone-a-friend plan is XX/X. for absolutely help business opportunities faster move plus just cheaper can Lockheed as All

in it within the that having remember a we larger. well; lot Lockheed of they they So And opportunities out as get mutually larger, capabilities very and a sub beneficial. really we them get have it's also stake get there. do us, Martin our very have that works by bigger work Because

Joshua Sullivan

PredaSAR, And likely a set still that to going offering to far constellation eventually data as you have you own as involved plan given were and up data analysis. then your forward? SAR Do operate

Marc Bell

not but as a constellation. Absolutely,

capital immense It for inbounds just we profile And an very who constellation being seen the of goal for And the core quickly on the SAR amount our if satellites. buy is And decided there's working. business. as as much intensive, lowest us, to have We smart, as owned SAR for we us the expanding possible. focused across our SAR And relationship as way people spectrum their profitability to constellation. get to buy SAR opportunity more be very this there. They want best wouldn't satellites with Lockheed get with quickly us. our to is to possible is Martin risk we

Operator

next Konrad Jefferies. comes from from Our question Greg

Gregory Konrad

question. off to the thinking in And that, just breakeven there start current of with inflation are outside I how thinking just mean, drivers where supply and And are the about just you left about level? last are volume? how Maybe on chain you environment? you profit

Gary Hobart

really prior inflation us on but our contracts, less on because an in to as our XX to months. was of we've pricing So converting matters of most impact within it contracts us, are XX mentioned calls,

defence a more So impact decades-long clients relative might than that programs. it to have muted has

in our contracts. In we addition, inflation generally have escalators

generally so it. covers And that

base terms chain of comes of much On generally nature. whether chain shortages, the in States. up the the really that the It's where the things hangover, in of COVID and not pricing yields The the industrial supply are supply it's just labor overall, boards as on in the on impact it's supply and there. chain, the we United inflation

this that of on and might products in to module on week in of schedule delay and programs or week adds this on week to I'm build the come assembly. have I them So And even expecting a in coming and just XX% twp. our both a

we've hasn't impact had an the our right on scheduling. little dramatic, been and the that's to been has It So year. seeing things overly throughout it but what a moving bit

just to stabilize. our to starting it SG&A the think profitability, far about the way to is As as path is

a at quarter year, each this you gone percentage If it throughout of as our it has look down. revenue,

question profit the gross trend we We continue. our to SG&A, where to positive. expect hit where obviously, that EBITDA started as And point that's exceeds

that. So path we're do to the on

giving we to specifically, our LTM requires an clause us June While covenants guidance basis our we're in have not by EBITDA with a lenders, on that XXXX. positive be of

So I think marketplace where far and comfort as company our reference to on a we're the that path the as towards steering can look profitability. point as the

Gregory Konrad

to maybe then seems things mean, follow I it just a in like of are strategy. the going right And bidding up direction. the lot on

bidding kind agreement, talked transport it next with and just you're you have you pursuing? go you haven't the You of online deliveries capacity things now thinking actively kind have like at capacity coming about over it going and have been on the Lockheed of well. Does something do year can maybe capacity the seems that the just been quarter, change bid pipeline, maybe the you that past about things incremental that outside

Marc Bell

we're we on you're sure Yes, year not can There bid things over because of did capacity the that to accepting. as what past make want we correct. deliver are we

And thing, to success lot us: on have the But year, they've bid delivery and capacity, thing we a the Lockheed to every next had every do deliveries program us more had last same programs. on we wanted want make allows XXX% on that success we ever was by bid more which So sure bail. rate program. XXX% rate taught have gotten. to we they've

this responsive new deliver sets so delay long-term the vertically reasonable could and our at our space, our with that's And which a in-house, for with have bringing satellites for we is components strategy everybody. integrate more the us And to future on with ability of chain. now of space, and your price more to more reduced faster we supply helps

Operator

Riley. to We from Crawford Mike turn B. now

Michael Crawford

Crawford. Mike Yes,

of you Marc, Orbital new LTM order say So of next positive $XXX to in Terran EBITDA hit win to summer needs million the contracts in year would number about 'XX? that

Marc Bell

that feel the We feel confident easily an will that add bidding We that. XX million months. over stuff very confident we're the on additional next our on about pipeline we $XXX and

Michael Crawford

that do into RFI a X turns navigation for space Tranche regard, layer up of think just and In a when RFI payloads, actually you the award? for Great. an that out the that agency, and transport of couple timing development in RFP physician being being coming weeks,

Marc Bell

We competencies. down and FDA, to the haven't coming decided things are There try if bid going core pipe to that. we on we're yet to from stick other our the

we going day. so whatever the things floating are with hitting have on is of our constant the of But contact but in are and opportunities want bidding to we're a payload, and to we we're our for being doing group, at that other around, what we're We sure first other building to FDA, we're going payload I be obviously a the make fit lot payloads right and the win. end

Michael Crawford

then kind helping about that approaching had this as regarding And satellite Can your recover talk directions. just past in moon work, you the of Okay. operational CAPSTONE several satellite? ability role to your that's of

Marc Bell

our huge from has perspective success. a CAPSTONE So been

the small target to We two moon. the our propulsion moon have or an first and another we And and be we've outside are We did the provided which everything piece built has perfectly equipment our on system of build very vendors, vendor, we proving the so next over We're should Because to it. was week worked exciting. why far. around of everything goes pretty excited from that and ourselves. theme issues outside outside going it's to step now about with so, on the are right some

very So pleased. are we

are But excited. we

track and next announcements in few it. should weeks We big you the are on and on some about course, see

from and we're running now. the subcontractor the a actually the ones was... that the NASA, pleased built bus but very we a NASA right has We're for actually we're contract So bus, got for Advanced actually program which Space,

network the the station a And been is will the permanent and for what exciting be for base be will moon plans very both beginning of communication a NASA to which program. the be building. that for this moon, it's So moon

Michael Crawford

With other 'XX. Okay. capital you then switching the in around, module nearby capacity region is or in investment anticipated to expansion online gears in pods your What look month expand do in to I in Irvine, the your 'XX? so coming with highway a these that California guess,

Marc Bell

high opening The in really it's satellite for assembly. that actually we're QX isn't bay up modules, for

building that So there's tremendous very a heavy. not goes the just for that. lift We to the need into very, CapEx satellite the satellites ability to are cranes have the as

so of that do do bay us to to things like what the And allows so and them we now I a like facilities, high Lockheed didn't then if solar like another hold point now that's Things have able attach out at can we we the do where that all would Martin, as at just we'll the Martin's Lockheed panels high Lockheed partner do to in is do And advantage bay we we be air payloads. up Lockheed, in-house. couldn't to arrangement that's of our that. work

Michael Crawford

in intend then further But question Right. is 'XX. you expand that also the out to Irvine

asking what in will that the expect So CapEx XXXX? be I'm you

Marc Bell

get TI. landlord lot We of a

build building going because it’s building a the the big -- building to box. haven't clear, be next We is really that when just we we're

got it's It's of as X space. ceiling, and of large just open think large, Walmart. walls it So

next the assembly. building So all will be for

door. lines company get things production an And like automotive the so we're to of to up going set out basically

CapEx, do of So this? you want there will to CapEx space. on some address Gary, be lot But there's the a

Gary Hobart

Yes.

But out development spread So as additional well the it providing kind we're an think on terms CapEx se. of guidance XX-month out TIs. not over the of per process it Irvine in netting being as space landlord for of

precision have of timing a with it's additional now right to going guidance. out space But we one the pursue Lockheed, we actual the on more have the of really capital know two, investment it. and to highlight the it's folks additional matter from scoping and whether now, we it, just that provide equipment. expansion, and coming capacity As We're or

So without that on I that pin ourselves hard for it's CapEx. scope, us, down think

this should we million, have $XX about guidance We about year finish say $XX the $XX close $XX about million our year-to-date. of to million can I is What CapEx at million. year's we're to CapEx to guided within

the basis, Next if than pursuing will the first quarter increased then a by will. in give CapEx we be that well be in color that, expansion the the But Irvine where as lower have creditor when recurring obviously timing the existing And build, stands. more we we self-funding market scope that we'll expansion as finishing year, on will up noted. more and can that be the build, you on not on

Michael Crawford

just Okay. XXX have bidding on your And bids rate then you're what's submitted for many contracts you're been? tracking, you that how on, these programs win that and

Marc Bell

on. submit We pick we what choose and

the customers decide want So we're bidding the We're stuff for is that to we're a program waiting XXX what they for funding. programs tracking necessarily not waiting to that we're actually do. on yet. It's

total want And that of kind things TAM gives working at subset So to the look what we down that and a that we're when and we we tracking. know choose bring what actually eventually the we customers. stuff, And bidding programs business internally, that on. of bid we the on our for we bus We bidding on to we to with work us are about that start what on.

You'll next it? you on we've that And over to on been if comment contracts want see the Gary, few on. months announcements

Gary Hobart

might X,XXX XXX is So of where give at in to process just that's than and one to bit we about satellites, X,XXX in active proposals is you just bids think. the on. And the certainly think you gives at it about but There's say, opportunities. we more the that process made probably that way where out, a those way sense are is linear have There's in awards. proposals in is going as but look pipeline, you the sense to X,XXX little I converting bidding up a into number least are And a proposals that, of pipeline of was that. it another that billion $XX satellites different just as to not absolute

Marc Bell

we Yes. a money. us. capacity I as have precious look mean asset If more our we is for at today

We today. more have capacity a lot

that for So we opportunity highest the to program get road value using us. that believe programs capacity are we down have the the the most or

Operator

next Our Melius Instructions] question [Operator comes Springarn from Robert Research. from

Robert Spingarn

a So twist want Gary, you and amount cash burn to balance it from discussion is And CapEx around the I this here? cash go touch that on expect to you of wanted the on how burn cash sheet? there trend and keep to to maybe minimum

Gary Hobart

least investment, the I forma cash. Lockheed $XX of this quarter we always at million million pro $XXX $XX of to keep want cash. over started After with point, Sure. At the to million

So for think near term. positioned well we're the I

on to path less for we to positive. generally When also the at the XXX% is our we that of get that maybe our path be think and and are a the about growth $XXX converting way and is But and and bidding of things, expecting revenue, expansion covering pipeline about existing XXX% profitability speaking, is year-over-year. Execution on the into anticipating looking, with planning or we're part capitalization, backlog way path our where we're revenue that to that. anywhere it needs to could that think margin of million, to type we're contingent about we to be bit a EBITDA be with able little at looking that growth are pace to from

can of of I capital depending level, working that CapEx, is I spending are the a in awards example, of what are costs. of minus because payments At cover upfront contracts. lead the mostly And about expense. cycle for solution on will material one be any have speaking, the on we $XX PredaSAR million after to interest that ahead opposed satellite that cash where business to plus for a have Generally then and or got as our year to labor flow dollars the business, awards fairly new positive

And to they tend positive. so be capital working

we're So may backlog. Marc conversion our to of I is precision more on some main going. the not of the data se the per of on and providing that model where hopefully, and and are and guidance of points given into have execution little points to But our reasons I've for a you reference really some one out pipeline

Robert Spingarn

third light they a and you there's order bookings that, in I'm And environment. to The when we awards competitors then But here Marc, about a targeted the that for were things volatility in took the some Okay. little quarter? were sure a but little bit maybe come. the talked pipeline come quarter, there the

Marc Bell

No. of what then award happens October against is year. coming a set in the government see that activity we lot on budget Usually the talk, X, of we every and QX and usually

cyclical it's government on of So awards very terms based budgets. in

which will noticed to of then will to award. lot very, And But X, cyclical quiet. mad going a cycle. year, a that award into budget have lot which becomes right dash. end of towards it we So the start RFPs, gets RFIs out We've of very in it's it a people, turn now the every October

Robert Spingarn

does support Marc. involved then talked Tranche last other layer, We've the And and X. LX companies on Northrop for to about your one, just But a Okay. mind bit be transport those words, others how on tracking the there, you there some about to able And layer. you come are you other with opportunity might example? do Lockheed in support other for your tracking Tranche permit layer In a feel to X, companies? similar And agreement vein?

Marc Bell

So would anybody. Lockheed from That Martin with that us working with not works. our be does restrict as antitrust agreement

to we this. work strategy is yet, work not we X. all we how have the when tracking did X are do make tracking decision out and What prime. being certain with bid with on we'll comes. intentionally There We That the that it a we things said, So everybody. not

We the have relationship a very FDA. with good

know going also not we're everything. win We to

and choose and we we try we pick will schedule. can win fit know into what we where our to So

our the they to the looking amazing, fact demand of testament work time, the SDAs are lot a on and here. everybody high we're transport are trans hard layer that And And capabilities people. by of delivering in

in we So want well. as customers obviously diversity

announce future, wins. wins of don't And building of won't think business customers and so for to customer because lot our nice allow we're we'll a book diverse a us we I the our announce

new amount going finite as get going backlog you start to down as new up, contracts see forward, to revenue will see a be we a wins, got we will you'll continue the jump and is the back of we we as and backlog seesaw new the burns that get book potentially capacity. revenue. only we but when will it What get So

to So we try that. be very for careful

Robert Spingarn

is catalysts beyond we part any should other of there other that early we year? the X in milestone looking And deliveries, Any Tranche that then be the Okay. for on? just focus next would

Marc Bell

mean increasing it by backlog big an milestone. I will be the QX, end of think I a

some the that lot have be of feel that we to the signed the And it's to very a of announce. will and works. and confident customer a lot stuff have a then we of We just in in pipeline, up things closed, lot

doing not work think more may I that's we be will it able more announce guys, bigger, We're part. important you be we numbers. to to the able announce but as who is. So for the And we and get classified

Operator

turn Alex Owen to Venture Capital. now Fuel We from

Alex Owen

on or over launched this X in accommodate of thoughts hear you and It'd broader to you in can fulfill how of human between off, the general proper moving years. expected growth the impressive and I'm capital the on, with the the to XX,XXX next skilled curious the anywhere completion First the and type will with market ability Florida have if given could availability the to in congratulations forward X,XXX this great the the the X another recruiting sector be launch pipeline XX,XXX facility, satellites backlog. have your ease of personnel touch great quarter. on to market is the well of of talent type to

Marc Bell

a Force, in to at launches to mean the a retired before like be XXX going XX,XXX Space from Raymond years. expects minimum. satellites centric I Jay over about has next government the who per Yes, next about That's retiring he That's view. said world U.S. U.S. the there's a few built year global said over view. years the XX U.S.-centric

In Irvine, incredible as pool. access to we're we expanding have talent here, an

near are of other Caltech lot up the have and labs, a road. the you right JPL We

L.A. in also well. labor out great pool from as and County a have We Orange here County

you're ability be competitive to to we comfortable very a and winners to that out to are our confident as obviously amount in there we're that going retain are our win. We're attract people. continue environment. very of companies and to the with And So But working there, continuing some some it on seeing aren't are is companies people. to ability programs

a it you was validator our to expect money Lockheed showed wouldn't they Martin, and invest the us didn't business the if investment plan, to winning. keep

we we're and good very So don't know future, our I it. on feel that answers bullish if your question. pretty about

Operator

participation. This call. thank today's to like for Q&A and your conference you our We'd concludes

lines. disconnect You your now may

Marc Bell

for Thank joining Thank everyone, you much. very us. you,

Terran Orbital (LLAP) 9 Nov 222022 Q3 Earnings call transcript