Revenues for full year 2023 increased 51.9%
to $243.8 million
Net Loss for full year 2023 improved by
$103.4 million to $(27.3) million
Adjusted EBITDA1 for full year 2023
increased by $26.3 million to $15.3 million
Net cash provided by (used in) operating
activities for the fourth quarter of 2023 improved by $20.5 million
to $15.7 million
Book-to-bill2 ratio for the fourth quarter
of 2023 was 2.81
Redwire Corporation (NYSE: RDW), a leading innovator in space
infrastructure enabling space mission providers with the
foundational building blocks and integrated solutions needed for
complex space missions, today announced results for its fourth
quarter and full year ended December 31, 2023. Unless otherwise
referred to as Comparable Revenues, financial information presented
herein includes the results of Space NV for periods including and
subsequent to the acquisition date of October 31, 2022.
Redwire will live stream a presentation with slides on March 15,
2024 at 9:00 a.m. ET. Please use the link below to follow along
with the live stream:
https://event.choruscall.com/mediaframe/webcast.html?webcastid=ORQbTdYl
“During 2023, Redwire achieved four consecutive quarters of
revenue growth and positive Adjusted EBITDA1,” stated Peter
Cannito, Chairman and Chief Executive Officer of Redwire. “This
trend is expected to continue in 2024 with Contracted Backlog2 of
$372.8 million at the start of the year. In addition, we expect to
aggressively add new business by scaling production, expanding our
offerings, and bidding on larger contracts. For instance, in Q4
2023 Redwire signed an approximately $142 million contract with an
undisclosed satellite manufacturer to produce Roll Out Solar
Arrays.”
Full Year 2023 Highlights
- Revenues for full year 2023 increased 51.9% to $243.8 million,
as compared to $160.5 million for the full year 2022.
- Net Loss for full year 2023 improved by $103.4 million to
$(27.3) million, as compared to $(130.6) million for the full year
2022.
- Adjusted EBITDA1 for full year 2023 increased by $26.3 million
to $15.3 million, as compared to $(11.0) million for the full year
2022.
- Contracted Backlog3 increased 19.1% year-over-year to $372.8
million as of December 31, 2023, as compared to $313.1 million as
of December 31, 2022.
- On a full year basis, book-to-bill3 was 1.23 for 2023, as
compared to 2.04 for 2022.
- Total available liquidity was $48.3 million as of December 31,
2023, comprised of $30.3 million in cash and cash equivalents and
$18.0 million in available borrowings from our existing credit
facilities.
Fourth Quarter 2023 Highlights
- Revenues for the fourth quarter of 2023 increased 18.2% to
$63.5 million, as compared to $53.7 million for the fourth quarter
of 2022.
- Comparable Revenues4 for the fourth quarter of 2023 increased
15.5% to $48.6 million, as compared to $42.0 million for the fourth
quarter of 2022.
- Net Loss for the fourth quarter of 2023 improved 68.2% to
$(8.2) million, as compared to $(25.9) million for the fourth
quarter of 2022.
- Adjusted EBITDA4 for the fourth quarter of 2023 increased by
$2.5 million to $1.7 million, as compared to $(0.8) million for the
fourth quarter of 2022.
- Book-to-bill3 ratio for the fourth quarter of 2023 was 2.81, as
compared to 3.74 as of the fourth quarter of 2022.
- Net cash provided by (used in) operating activities for the
fourth quarter of 2023 improved by $20.5 million to $15.7 million,
as compared to $(4.8) million for the fourth quarter of 2022.
- Free Cash Flow4 for the fourth quarter of 2023 was $12.6
million, as compared to $(5.5) million for the fourth quarter of
2022.
2024 Forecast
- For the full year ended December 31, 2024, Redwire is
forecasting revenues of $300 million.
“Redwire finished 2023 with strong commercial and financial
performance in the fourth quarter, recognizing record revenues of
$63.5 million and positive Adjusted EBITDA4 of $1.7 million in Q4
2023, which includes a negative impact from net EAC adjustments
during the fourth quarter” said Jonathan Baliff, Chief Financial
Officer of Redwire. “Redwire saw marked financial improvement on a
year-over-year basis, with a 51.9% increase in revenues. 2023
profitability improvement was driven by an increase in Gross Profit
and a decrease in SG&A year-over-year. This yielded $15.3
million in full year Adjusted EBITDA4, positive net cash flow from
operations of $1.2 million, and $30.3 million of cash on the
balance sheet. Importantly, with our significant improvement in
fourth quarter Contracted Backlog3 with book-to-bill3 of 2.81,
Redwire enters 2024 with strong growth and profitability momentum
and a full year revenue forecast of $300 million.”
Webcast and Investor
Call
Management will conduct a conference call starting at 9:00 a.m.
ET on Friday, March 15, 2024 to review financial results for the
fourth quarter and full year ended December 31, 2023. This release
and the most recent investor slide presentation are available in
the investor relations area of our website at redwirespace.com.
Redwire will live stream a presentation with slides during the
call. Please use the following link to follow along with the live
stream:
https://event.choruscall.com/mediaframe/webcast.html?webcastid=ORQbTdYl.
The dial-in number for the live call is 877-485-3108 (toll free) or
201-689-8264 (toll), and the conference ID is 13744388.
A telephone replay of the call will be available for two weeks
following the event by dialing 877-660-6853 (toll-free) or
201-612-7415 (toll) and entering the access code 13744388. The
accompanying investor presentation will be available on March 15,
2024 on the investor section of Redwire’s website at
redwirespace.com.
Any replay, rebroadcast, transcript or other reproduction or
transmission of this conference call, other than the replay
accessible by calling the number and website above, has not been
authorized by Redwire Corporation and is strictly prohibited.
Investors should be aware that any unauthorized reproduction of
this conference call may not be an accurate reflection of its
contents.
1 Adjusted EBITDA are not measures of
results under generally accepted accounting principles in the
United States. Please refer to “Non-GAAP Financial Information” and
the reconciliation tables included in this press release for
details regarding these Non-GAAP measures.
2 Book-to-bill and Contracted Backlog are
key business measures. Please refer to “Key Performance Indicators”
and the tables included in this press release for additional
information.
3Book-to-bill and Contracted Backlog are
key business measures. Please refer to “Key Performance Indicators”
and the tables included in this press release for additional
information.
4 Comparable Revenues, Adjusted EBITDA,
and Free Cash Flow are not measures of results under generally
accepted accounting principles in the United States. Please refer
to “Non-GAAP Financial Information” and the reconciliation tables
included in this press release for details regarding these Non-GAAP
measures.
About Redwire
Redwire Corporation (NYSE:RDW) is a global space infrastructure
and innovation company enabling civil, commercial, and national
security programs. Redwire’s proven and reliable capabilities
include avionics, sensors, power solutions, critical structures,
mechanisms, radio frequency systems, platforms, missions, and
microgravity payloads. Redwire combines decades of flight heritage
and proven experience with an agile and innovative culture.
Redwire’s approximately 700 employees working from 14 facilities
located throughout the United States and Europe are committed to
building a bold future in space for humanity, pushing the envelope
of discovery and science while creating a better world on Earth.
For more information, please visit redwirespace.com.
Cautionary Statement Regarding
Forward-Looking Statements
Readers are cautioned that the statements contained in this
press release regarding expectations of our performance or other
matters that may affect our business, results of operations, or
financial condition are “forward-looking statements” as defined by
the “safe harbor” provisions in the Private Securities Litigation
Reform Act of 1995. Such statements are made in reliance on the
safe harbor provisions of Section 27A of the Securities Act of 1933
and Section 21E of the Securities Exchange Act of 1934. All
statements, other than statements of historical fact, included or
incorporated in this press release, including statements regarding
our strategy, financial position, guidance, funding for continued
operations, cash reserves, liquidity, projected costs, plans,
projects, awards and contracts, and objectives of management, among
others, are forward-looking statements. Words such as “expect,”
“anticipate,” “should,” “believe,” “hope,” “target,” “continued,”
“project,” “plan,” “goals,” “opportunity,” “appeal,” “estimate,”
“potential,” “predict,” “demonstrates,” “may,” “will,” “might,”
“could,” “intend,” “shall,” “possible,” “would,” “approximately,”
“likely,” “outlook,” “schedule,” “on track,” “poised,” “pipeline,”
and variations of these terms or the negative of these terms and
similar expressions are intended to identify these forward-looking
statements, but the absence of these words does not mean that a
statement is not forward-looking. These forward-looking statements
are not guarantees of future performance, conditions or results.
Forward-looking statements are subject to a number of risks and
uncertainties, many of which involve factors or circumstances that
are beyond our control.
These factors and circumstances include, but are not limited to:
(1) risks associated with the continued economic uncertainty,
including high inflation, supply chain challenges, labor shortages,
high interest rates, foreign currency exchange volatility, concerns
of economic slowdown or recession and reduced spending or
suspension of investment in new or enhanced projects; (2) the
failure of financial institutions or transactional counterparties;
(3) the Company’s limited operating history and history of losses
to date; (4) the inability to successfully integrate recently
completed and future acquisitions; (5) the development and
continued refinement of many of the Company’s proprietary
technologies, products and service offerings; (6) competition with
new or existing companies; (7) the possibility that the Company’s
expectations and assumptions relating to future results may prove
incorrect; (8) adverse publicity stemming from any incident or
perceived risk involving Redwire or our competitors; (9)
unsatisfactory performance of our products resulting from
challenges in the space environment, extreme space weather events,
or otherwise; (10) the emerging nature of the market for in-space
infrastructure services; (11) inability to realize benefits from
new offerings or the application of our technologies; (12) the
inability to convert orders in backlog into revenue; (13) our
dependence on U.S. government contracts, which are only partially
funded and subject to immediate termination; (14) the fact that we
are subject to stringent U.S. economic sanctions, and trade control
laws and regulations; (15) the need for substantial additional
funding to finance our operations, which may not be available when
we need it, on acceptable terms or at all; (16) the fact that the
issuance and sale of shares of our Series A Convertible Preferred
Stock has reduced the relative voting power of holders of our
common stock and diluted the ownership of holders of our capital
stock; (17) AE Industrial Partners and Bain Capital have
significant influence over us, which could limit your ability to
influence the outcome of key transactions; (18) provisions in our
Certificate of Designation with respect to our Series A Convertible
Preferred Stock may delay or prevent our acquisition by a third
party, which could also reduce the market price of our capital
stock; (19) our Series A Convertible Preferred Stock has rights,
preferences and privileges that are not held by, and are
preferential to, the rights of holders of our other outstanding
capital stock; (20) there may be sales of a substantial amount of
our common stock by our current stockholders, and these sales could
cause the price of our common stock and warrants to fall; (21) the
impact of the issuance of the Series A Convertible Preferred Stock
on the price and market for our common stock; (22) the trading
price of our common stock and warrants is and may continue to be
volatile; (23) risks related to short sellers of our common stock;
(24) our management team’s limited experience operating a public
company; (25) inability to report our financial condition or
results of operations accurately or timely as a result of
identified material weaknesses in internal control over financial
reporting; and (26) other risks and uncertainties described in our
most recent Annual Report on Form 10-K and Quarterly Reports on
Form 10-Q and those indicated from time to time in other documents
filed or to be filed with the SEC by the Company.
The forward-looking statements contained in this press release
are based on our current expectations and beliefs concerning future
developments and their potential effects on us. If underlying
assumptions to forward-looking statements prove inaccurate, or if
known or unknown risks or uncertainties materialize, actual results
could vary materially from those anticipated, estimated, or
projected. The forward-looking statements contained in this press
release are made as of the date of this press release, and the
Company disclaims any intention or obligation, other than imposed
by law, to update or revise any forward-looking statements, whether
as a result of new information, future events, or otherwise.
Persons reading this press release are cautioned not to place undue
reliance on forward-looking statements.
Non-GAAP Financial
Information
This press release contains financial measures that have not
been prepared in accordance with United States Generally Accepted
Accounting Principles (“U.S. GAAP”). These financial measures
include Adjusted EBITDA, Pro Forma Adjusted EBITDA, Free Cash Flow,
and Comparable Revenues.
Non-GAAP financial measures are used to supplement the financial
information presented on a U.S. GAAP basis and should not be
considered in isolation or as a substitute for the relevant U.S.
GAAP measures and should be read in conjunction with information
presented on a U.S. GAAP basis. Because not all companies use
identical calculations, our presentation of Non-GAAP measures may
not be comparable to other similarly titled measures of other
companies.
Adjusted EBITDA is defined as net income (loss) adjusted
for interest expense, net, income tax expense (benefit),
depreciation and amortization, impairment expense, acquisition deal
costs, acquisition integration costs, acquisition earnout costs,
purchase accounting fair value adjustment related to deferred
revenue, severance costs, capital market and advisory fees,
litigation-related expenses, write-off of long-lived assets,
equity-based compensation, committed equity facility transaction
costs, debt financing costs, and warrant liability change in fair
value adjustments. Pro Forma Adjusted EBITDA is defined as
Adjusted EBITDA further adjusted for the incremental Adjusted
EBITDA that acquired businesses would have contributed for the
periods presented if such acquisitions had occurred on January 1 of
the year in which they occurred. Accordingly, historical financial
information for the businesses acquired includes pro forma
adjustments calculated in a manner consistent with the concepts of
Article 8 of Regulation S-X, which are ultimately added back in the
calculation of Adjusted EBITDA. Free Cash Flow is computed
as net cash provided by (used in) operating activities less capital
expenditures. Comparable Revenues is calculated as revenues
less acquisition-related revenues. Revenues are considered
acquisition-related for the first four full quarters since the
entities’ acquisition date. After the completion of four fiscal
quarters, revenues from acquired entities are presented as
comparable in the current period with prior periods conformed to
current presentation.
We use Adjusted EBITDA and Pro Forma Adjusted EBITDA to evaluate
our operating performance, generate future operating plans, and
make strategic decisions, including those relating to operating
expenses and the allocation of internal resources. We use Free Cash
Flow as a useful indicator of liquidity to evaluate our
period-over-period operating cash generation that will be used to
service our debt, and can be used to invest in future growth
through new business development activities and/or acquisitions,
among other uses. Free Cash Flow does not represent the total
increase or decrease in our cash balance, and it should not be
inferred that the entire amount of Free Cash Flow is available for
discretionary expenditures, since we have mandatory debt service
requirements and other non-discretionary expenditures that are not
deducted from this measure. Comparable Revenues is used to compare
revenues over various periods, excluding the impact of acquisitions
whose results are not reflected in all periods presented. We
believe Pro Forma Adjusted EBITDA and Comparable Revenues provide
meaningful insights into the impact of strategic acquisitions as
well as an indicative run rate of the Company’s future operating
performance.
Key Performance
Indicators
Management uses Key Performance Indicators (“KPIs”) to assess
the financial performance of the Company, monitor relevant trends
and support financial, operational and strategic decision-making.
Management frequently monitors and evaluates KPIs against internal
targets, core business objectives as well as industry peers and
may, on occasion, change the mix or calculation of KPIs to better
align with the business, its operating environment, standard
industry metrics or other considerations. If the Company changes
the method by which it calculates or presents a KPI, prior period
disclosures are recast to conform to current presentation.
During the first quarter of 2023, we made the following changes
with respect to our KPIs:
- Changed the book-to-bill calculation to present this metric on
an LTM (“Last Twelve Months”) basis, whereas prior period
disclosures were presented on a year-to-date basis. Book-to-bill
LTM is calculated by aggregation of quarterly revenues and
contracts awarded for the last four quarters.
- Changed the backlog calculation to present only contracted
backlog, whereas prior period disclosures also presented
uncontracted backlog. There was no change in the calculation of
contracted backlog.
Management believes these presentation changes will provide
meaningful insights into contract award trends and increase
comparability of the Company’s performance metrics with those of
industry peers.
REDWIRE CORPORATION
CONSOLIDATED BALANCE
SHEETS
Unaudited
(In thousands of U.S. dollars,
except share data)
December 31, 2023
December 31, 2022
Assets
Current assets:
Cash and cash equivalents
$
30,278
$
28,316
Accounts receivable, net
32,411
26,726
Contract assets
36,961
31,041
Inventory
1,516
1,469
Income tax receivable
636
688
Prepaid insurance
1,083
2,240
Prepaid expenses and other current
assets
6,428
5,687
Total current assets
109,313
96,167
Property, plant and equipment, net of
accumulated depreciation of $6,538 and $3,032, respectively
15,909
12,761
Right-of-use assets
13,181
13,103
Intangible assets, net of accumulated
amortization of $18,509 and $11,247, respectively
62,985
66,871
Goodwill
65,757
64,618
Equity method investments
3,613
3,269
Other non-current assets
511
909
Total assets
$
271,269
$
257,698
Liabilities, Convertible Preferred
Stock and Equity (Deficit)
Current liabilities:
Accounts payable
$
18,573
$
17,584
Notes payable to sellers
—
1,000
Short-term debt, including current portion
of long-term debt
1,378
2,578
Short-term operating lease liabilities
3,737
3,214
Short-term finance lease liabilities
439
299
Accrued expenses
32,902
36,581
Deferred revenue
52,645
29,817
Other current liabilities
2,362
3,666
Total current liabilities
112,036
94,739
Long-term debt, net
86,842
74,745
Long-term operating lease liabilities
12,302
12,670
Long-term finance lease liabilities
1,137
579
Warrant liabilities
3,325
1,314
Deferred tax liabilities
2,402
3,255
Other non-current liabilities
400
506
Total liabilities
$
218,444
$
187,808
REDWIRE CORPORATION
CONSOLIDATED BALANCE
SHEETS
Unaudited
(In thousands of U.S. dollars,
except share data)
December 31, 2023
December 31, 2022
Convertible preferred stock, $0.0001 par
value, 125,292.00 shares authorized; 93,890.20 and 81,250.00 issued
and outstanding as of December 31, 2023 and December 31, 2022,
respectively. Liquidation preference of $187,780 and $162,500 as of
December 31, 2023 and December 31, 2022, respectively.
$
96,106
$
76,365
Shareholders’ Equity (Deficit):
Preferred stock, $0.0001 par value,
99,874,708 shares authorized; none issued and outstanding as of
December 31, 2023 and December 31, 2022, respectively
—
—
Common stock, $0.0001 par value,
500,000,000 shares authorized; 65,546,174 and 64,280,631 issued and
outstanding as of December 31, 2023 and December 31, 2022,
respectively
7
6
Treasury stock, 353,470 and 141,811
shares, at cost, as of December 31, 2023 and December 31, 2022,
respectively
(951
)
(381
)
Additional paid-in capital
188,323
198,126
Accumulated deficit
(233,791
)
(206,528
)
Accumulated other comprehensive income
(loss)
2,903
2,076
Total shareholders’ equity
(deficit)
(43,509
)
(6,701
)
Noncontrolling interests
228
226
Total equity (deficit)
(43,281
)
(6,475
)
Total liabilities, convertible
preferred stock and equity (deficit)
$
271,269
$
257,698
REDWIRE CORPORATION
CONSOLIDATED STATEMENTS OF
OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
Unaudited
(In thousands of U.S. dollars,
except share and per share data)
Three Months Ended
Year Ended
December 31, 2023
December 31, 2022
December 31, 2023
December 31, 2022
Revenues
$
63,485
$
53,705
$
243,800
$
160,549
Cost of sales
52,754
45,112
185,831
131,854
Gross margin
10,731
8,593
57,969
28,695
Operating expenses:
Selling, general and administrative
expenses
16,499
16,517
68,525
70,342
Transaction expenses
—
1,324
13
3,237
Impairment expense
—
16,161
—
96,623
Research and development
989
376
4,979
4,941
Operating income (loss)
(6,757
)
(25,785
)
(15,548
)
(146,448
)
Interest expense, net
2,762
2,696
10,699
8,219
Other (income) expense, net
(1,186
)
(1,582
)
1,503
(16,075
)
Income (loss) before income
taxes
(8,333
)
(26,899
)
(27,750
)
(138,592
)
Income tax expense (benefit)
(117
)
(1,023
)
(486
)
(7,972
)
Net income (loss)
(8,216
)
(25,876
)
(27,264
)
(130,620
)
Net income (loss) attributable to
noncontrolling interests
72
(3
)
(1
)
(3
)
Net income (loss) attributable to
Redwire Corporation
(8,288
)
(25,873
)
(27,263
)
(130,617
)
Less: dividends on Convertible Preferred
Stock
7,981
1,760
20,021
1,760
Net income (loss) available to common
shareholders
$
(16,269
)
$
(27,633
)
$
(47,284
)
$
(132,377
)
Net income (loss) per common
share:
Basic and diluted
$
(0.25
)
$
(0.43
)
$
(0.73
)
$
(2.09
)
Weighted-average shares outstanding:
Basic and diluted
65,194,767
64,136,433
64,654,153
63,324,416
Comprehensive income (loss):
Net income (loss) attributable to Redwire
Corporation
$
(8,288
)
$
(25,873
)
$
(27,263
)
$
(130,617
)
Foreign currency translation gain (loss),
net of tax
1,134
2,651
830
1,987
Total other comprehensive income (loss),
net of tax
1,134
2,651
830
1,987
Total comprehensive income
(loss)
$
(7,154
)
$
(23,222
)
$
(26,433
)
$
(128,630
)
REDWIRE CORPORATION
CONSOLIDATED STATEMENTS OF
CASH FLOWS
Unaudited
(In thousands of U.S.
dollars)
Year Ended
December 31, 2023
December 31, 2022
Cash flows from operating
activities:
Net income (loss)
(27,264
)
(130,620
)
Adjustments to reconcile net income (loss)
to net cash provided by (used in) operating activities:
Depreciation and amortization expense
10,724
11,288
Amortization of debt issuance costs and
discount
608
490
Equity-based compensation expense
8,658
10,786
(Gain) loss on change in fair value of
committed equity facility
255
631
(Gain) loss on change in fair value of
warrants
2,011
(17,784
)
Deferred provision (benefit) for income
taxes
(925
)
(8,238
)
Impairment expense
—
96,623
Income from equity method investments
(245
)
(58
)
Non-cash lease expense
327
264
Non-cash interest expense
525
690
Other
(238
)
208
Changes in assets and liabilities:
(Increase) decrease in accounts
receivable
(5,562
)
(6,646
)
(Increase) decrease in contract assets
(5,442
)
813
(Increase) decrease in inventory
(44
)
(978
)
(Increase) decrease in prepaid
insurance
1,157
579
(Increase) decrease in prepaid expenses
and other assets
(928
)
266
Increase (decrease) in accounts payable
and accrued expenses
(3,280
)
(1
)
Increase (decrease) in deferred
revenue
22,736
8,270
Increase (decrease) in operating lease
liabilities
(325
)
—
Increase (decrease) in other
liabilities
(960
)
1,760
Increase (decrease) in notes payable to
sellers
(557
)
—
Net cash provided by (used in) operating
activities
1,231
(31,657
)
Cash flows from investing
activities:
Acquisition of businesses, net of cash
acquired
—
(33,230
)
Purchases of property, plant and
equipment, net
(5,620
)
(3,626
)
Purchase of intangible assets
(2,707
)
(526
)
Net cash provided by (used in) investing
activities
(8,327
)
(37,382
)
Cash flows from financing
activities:
Proceeds received from debt
36,696
22,696
Repayments of debt
(26,683
)
(23,658
)
Payment of debt issuance fees to third
parties
(163
)
(1,254
)
Repayment of finance leases
(395
)
(55
)
Proceeds from issuance of common stock
1,241
2,956
Payment of committed equity facility
transaction costs
(571
)
(161
)
Proceeds from issuance of convertible
preferred stock
—
81,250
Payments of issuance costs related to
convertible preferred stock
(52
)
(4,833
)
Shares repurchased for settlement of
employee tax withholdings on share-based awards
(570
)
(381
)
Payment of contingent earnout
(443
)
—
Net cash provided by (used in) financing
activities
9,060
76,560
Effect of foreign currency rate changes on
cash and cash equivalents
(2
)
272
Net increase (decrease) in cash and cash
equivalents
1,962
7,793
Cash and cash equivalents at beginning of
period
28,316
20,523
Cash and cash equivalents at end of
period
$
30,278
$
28,316
REDWIRE CORPORATION
Supplemental Non-GAAP
Information
Unaudited
Adjusted EBITDA and Pro Forma
Adjusted EBITDA
The following table presents the
reconciliations of Adjusted EBITDA and Pro Forma Adjusted EBITDA to
net income (loss), computed in accordance with U.S. GAAP.
Three Months Ended
Year Ended
(in thousands)
December 31, 2023
December 31, 2022
December 31, 2023
December 31, 2022
Net income (loss)
$
(8,216
)
$
(25,876
)
$
(27,264
)
$
(130,620
)
Interest expense, net
2,762
2,697
10,699
8,220
Income tax expense (benefit)
(117
)
(1,023
)
(486
)
(7,972
)
Depreciation and amortization
2,753
2,452
10,724
11,288
Impairment expense
—
16,161
—
96,623
Acquisition deal costs (i)
—
1,324
13
3,237
Acquisition integration costs (i)
—
1,096
546
3,915
Purchase accounting fair value adjustment
related to deferred revenue (ii)
—
33
15
139
Severance costs (iii)
(69
)
843
313
1,311
Capital market and advisory fees (iv)
1,716
732
8,607
5,547
Litigation-related expenses (v)
918
53
1,235
2,877
Equity-based compensation (vi)
2,341
2,114
8,658
10,786
Committed equity facility transaction
costs (vii)
80
400
259
1,364
Debt financing costs (viii)
—
—
17
102
Warrant liability change in fair value
adjustment (ix)
(464
)
(1,779
)
2,011
(17,784
)
Adjusted EBITDA
1,704
(773
)
15,347
(10,967
)
Pro forma impact on Adjusted EBITDA
(x)
—
320
—
3,932
Pro Forma Adjusted EBITDA
$
1,704
$
(453
)
$
15,347
$
(7,035
)
i.
Redwire incurred acquisition
costs including due diligence, integration costs and additional
expenses related to pre-acquisition activity.
ii.
Redwire recorded adjustments
related to the impact of recognizing deferred revenue at fair value
as part of the purchase accounting for previous acquisitions.
iii.
Redwire incurred severance costs
related to separation agreements entered into with former
employees.
iv.
Redwire incurred capital market
and advisory fees related to advisors assisting with transitional
activities associated with becoming a public company, such as
implementation of internal controls over financial reporting, and
the internalization of corporate services, including, but not
limited to, implementing enhanced enterprise resource planning
systems.
v.
Redwire incurred expenses related
to the 2021 Audit Committee investigation and resulting securities
litigation.
vi.
Redwire incurred expenses related
to equity-based compensation under Redwire’s equity-based
compensation plan.
vii.
Redwire incurred expenses related
to the committed equity facility with B. Riley, which includes
consideration paid to enter into the Purchase Agreement as well as
changes in fair value recognized as a gain or loss during the
respective periods.
viii.
Redwire incurred expenses related
to debt financing agreements, including amendment related fees paid
to third parties that are expensed in accordance with U.S.
GAAP.
ix.
Redwire adjusted the private
warrant liability to reflect changes in fair value recognized as a
gain or loss during the respective periods.
x.
Pro forma impact is computed in a
manner consistent with the concepts of Article 8 of Regulation S-X
and represents the incremental results of a full period of
operations assuming the entities acquired during the periods
presented were acquired from January 1 of the year in which they
occurred. For the periods presented, the pro forma impact included
the results of Space NV.
Free Cash Flow
The following table presents the
reconciliation of Free Cash Flow to Net cash provided by (used in)
operating activities, computed in accordance with U.S. GAAP.
Three Months Ended
Year Ended
(in thousands)
December 31, 2023
December 31, 2022
December 31, 2023
December 31, 2022
Net cash provided by (used in)
operating activities
$
15,691
$
(4,828
)
$
1,231
$
(31,657
)
Less: Capital expenditures
(3,113
)
(720
)
(8,327
)
(4,152
)
Free Cash Flow
$
12,578
$
(5,548
)
$
(7,096
)
$
(35,809
)
Comparable Revenues
The following table presents the
reconciliation of Comparable Revenues to Revenues, computed in
accordance with U.S. GAAP.
Three Months Ended
Year Ended
(in thousands)
December 31, 2023
December 31, 2022
December 31, 2023
December 31, 2022
Revenues
$
63,485
$
53,705
$
243,800
$
160,549
Less: Acquisition-related revenues:
Space NV
(14,902
)
(11,658
)
(54,926
)
(11,658
)
Comparable Revenues
$
48,583
$
42,047
$
188,874
$
148,891
REDWIRE CORPORATION
KEY PERFORMANCE
INDICATORS
Unaudited
Book-to-Bill
Our book-to-bill ratio was as follows for
the periods presented:
Three Months Ended
Last Twelve Months
(in thousands, except ratio)
December 31, 2023
December 31, 2022
December 31, 2023
December 31, 2022
Contracts awarded
$
178,208
$
201,003
$
300,042
$
327,035
Revenues
63,485
53,705
243,800
160,549
Book-to-bill ratio
2.81
3.74
1.23
2.04
Book-to-bill is the ratio of total
contracts awarded to revenues recorded in the same period. The
contracts awarded balance includes firm contract orders, including
time and material contracts, awarded during the period and does not
include unexercised contract options or potential orders under
indefinite delivery/indefinite quantity contracts. Although the
contracts awarded balance reflects firm contract orders,
terminations, amendments, or contract cancellations may occur which
could result in a reduction to the contracts awarded balance.
We view book-to-bill as an indicator of
future revenue growth potential. To drive future revenue growth,
our goal is for the level of contracts awarded in a given period to
exceed the revenue recorded, thus yielding a book-to-bill ratio
greater than 1.0.
Our book-to-bill ratio was 2.81 for the
three months ended December 31, 2023, as compared to 3.74 for the
three months ended December 31, 2022. For the three months ended
December 31, 2023 none of the contracts awarded balance relates to
acquired contract value. For the three months ended December 31,
2022, contracts awarded includes $109.8 million of acquired
contract value from the Space NV acquisition, which was completed
in the fourth quarter of 2022.
Our book-to-bill ratio was 1.23 for the
LTM ended December 31, 2023, as compared to 2.04 for the LTM ended
December 31, 2022. For the LTM ended December 31, 2023, none of the
contracts awarded balance relates to acquired contract value. For
the LTM ended December 31, 2022, contracts awarded includes $109.8
million of acquired contract value from the Space NV acquisition,
which was completed in the fourth quarter of 2022.
Backlog
The following table presents our
contracted backlog as of December 31, 2023 and December 31, 2022,
and related activity for the year ended December 31, 2023 as
compared to the year ended December 31, 2022.
(in thousands)
December 31,
2023
December 31,
2022
Organic backlog, beginning balance
$
313,057
$
139,742
Organic additions during the period
300,042
327,035
Organic revenue recognized during the
period
(243,800
)
(160,549
)
Foreign currency translation
3,491
6,829
Organic backlog, ending balance
372,790
313,057
Acquisition-related contract value,
beginning balance
—
—
Acquisition-related backlog, ending
balance
—
—
Contracted backlog, ending
balance
$
372,790
$
313,057
We view growth in backlog as a key measure
of our business growth. Contracted backlog represents the estimated
dollar value of firm funded executed contracts for which work has
not been performed (also known as the remaining performance
obligations on a contract). Our contracted backlog includes $19.3
million and $37.4 million in remaining contract value from time and
materials contracts as of December 31, 2023 and as of December 31,
2022, respectively.
Organic backlog change excludes backlog
activity from acquisitions for the first four full quarters since
the entities’ acquisition date. Contracted backlog activity for the
first four full quarters since the entities’ acquisition date is
included in acquisition-related contracted backlog change. After
the completion of four fiscal quarters, acquired entities are
treated as organic for current and comparable historical
periods.
Organic contract value includes the
remaining contract value as of January 1 not yet recognized as
revenue and additional orders awarded during the period for those
entities treated as organic. Acquisition-related contract value
includes remaining contract value as of the acquisition date not
yet recognized as revenue and additional orders awarded during the
period for entities not treated as organic. Organic revenue
includes revenue earned during the period presented for those
entities treated as organic, while acquisition-related revenue
includes the same for all other entities, excluding any
pre-acquisition revenue earned during the period. There is no
acquisition-related backlog activity presented in the table above
as all acquired entities have completed four fiscal quarters
post-acquisition.
Although contracted backlog reflects
business associated with contracts that are considered to be firm,
terminations, amendments or contract cancellations may occur, which
could result in a reduction in our total backlog. In addition, some
of our multi-year contracts are subject to annual funding.
Management expects all amounts reflected in contracted backlog to
ultimately be fully funded. Contracted backlog from foreign
operations in Luxembourg and Belgium was $106.0 million and $129.9
million as of December 31, 2023 and December 31, 2022,
respectively. These amounts are subject to foreign exchange rate
translations from euros to U.S. dollars that could cause the
remaining backlog balance to fluctuate with the foreign exchange
rate at the time of measurement.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240314860292/en/
Investor Relations Contact:
investorrelations@redwirespace.com
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