WASHINGTON — Space technology company Redwire said that while it still views the commercial sector as its biggest long-term growth prospect, volatility among its customers could cause delays.
Redwire, which went public through a SPAC merger last year, reported revenue of $32.9 million in its first quarter earnings release on May 12. The company had a net loss of $17.3 million and an adjusted earnings before interest, tax, depreciation and amortization (EBITDA) loss of $4.7 million for the quarter.
The first quarter was “slightly below expectations,” Peter Cannito, president and chief executive of Redwire, said on an earnings call. This shortfall was due in part to contract awards being delayed due to delays in completing the federal government’s FY 2022 appropriations, as well as supply chain issues with subcontractors.
Another factor, he said, was “some volatility associated with emerging commercial space contract orders.” He didn’t give specific cases of problems, but later said companies facing funding or regulatory issues could affect the timing of orders.
“With rapidly changing economic conditions, uncertainty has increased,” he said. “If we were to say that anything has changed, it is a little bit of uncertainty about timing, as many commercial space companies in our industry are a vendor to change their forecasts over time.”
“If the commercial space segment fails to meet its forecasts in line with the projections that were widespread last year, that also adds uncertainty to our forecast for the next five years,” he added.
Despite this current uncertainty, Cannito remained optimistic about the commercial sector’s long-term growth potential. Redwire does business with NASA and in the national security space, where he said the company has seen strong “demand signals” for various technologies the company develops. The company used the call to highlight work such as building solar panels for the International Space Station and an indefinite delivery and indefinite quantity contract from the US Air Force with a maximum value of $950 million for the Advanced Battle Management System. of the service, taking advantage of the company’s expertise in digital engineering.
The commercial market, however, offered greater long-term prospects, he argued. “The emerging commercial space segment has tremendous growth potential over the next 5 to 10 years that could far outpace other segments in annual growth rate.”
Redwire confirmed previous financial forecasts for 2022, projecting $165 million to $195 million in revenue and $8 million to $15 million in adjusted EBITDA for the full year. “We expect sales to be heavier for the second half of the year,” said Bill Read, Redwire’s chief financial officer, citing its $273.9 million backlog.