Momentus inc. announces second quarter 2022 financial results
San jose, calif.--(business wire)--momentus inc. (nasdaq: mnts) (“momentus” or the "company”), a u.s. commercial space company that plans to offer transportation and other in-space infrastructure services, today announced its financial results for the second quarter ended june 30, 2022. "we continue to make progress toward our goal of being a key provider of transportation and infrastructure services to the emerging new space economy," said momentus chief executive john rood. “during the second quarter, we retired regulatory risk, cleared all remaining licensing hurdles, and flew our inaugural demonstration mission with our vigoride vehicle. since the last earnings call, we have also deployed seven customer satellites in low earth orbit (six from vigoride 3, one from a third party deployer). we have learned a great deal from this first launch and from observing how the vigoride orbital transfer vehicle performed in space during its initial demonstration mission. we plan to incorporate improvements into future vigoride vehicles, beginning with the one that we plan to fly during our next mission this fall.” second quarter 2022 business and financial highlights: retired regulatory risk, including securing all necessary government licenses and approvals from the faa, fcc, and noaa to launch our first orbital transfer vehicle, vigoride 3, to space. completed assembly and ground-testing of the vigoride 3 spacecraft, integrated customer payloads, and shipped it to the launch site at cape canaveral, florida. launched vigoride 3 to low earth orbit onboard spacex’s transporter-5 mission. confirmed that two customer satellites were deployed from vigoride 3 during the second quarter of 2022. an additional four customer satellites have since been deployed in the third quarter from vigoride 3, for a total of six, thus far. deployed a customer satellite from a third-party deployer system on the same spacex rocket, which is part of the company’s effort to explore the adjacent ride-share aggregation market segment, bringing to seven the total number of satellites deployed recently by the company in low earth orbit (six from vigoride 3, one from a third party deployer). identified root cause of all the anomalies experienced on the vigoride 3 mission and are on track to implement corrective actions on the next vigoride mission scheduled for this fall. developed a plan to reduce expected cash burn rate and extend cash runway through the end of 2023. the company plans to reduce its cash burn below previously-planned levels by reducing overhead spending and delaying longer-dated research and development projects. the company plans to continue development of the vigoride vehicle, including planned launches on spacex rideshare missions targeted for november 2022, february 2023, and may 2023. added key talent with impressive and long careers that will provide a competitive advantage. key additions included: charles chase, vice president of engineering nick zello, vice president of manufacturing and operations gary bartmann, vice president of supply chain krishnan j. anand, vice president of program management charles chase, vice president of engineering nick zello, vice president of manufacturing and operations gary bartmann, vice president of supply chain krishnan j. anand, vice president of program management note: krishnan anand’s hiring occurred after the close of the second quarter of 2022. conference call information momentus inc. will host a conference call to discuss the results today, august 11, 2022, at 12:00 p.m. eastern time (9:00 a.m. pacific time). to access the conference call, participants should dial +1 (800) 715-9871 and enter the conference id number 3677381. international participants should dial +1 (646) 307-1963. the live audio webcast along with supplemental information will be accessible on the company’s investor relations website at https://investors.momentus.space/events-and-presentations. a recording of the webcast will also be available following the conference call. about momentus inc. momentus is a u.s. commercial space company that plans to offer in-space infrastructure services, including in-space transportation, hosted payloads and in-orbit services. momentus believes it can make new ways of operating in space possible with its planned in-space transfer and service vehicles that will be powered by an innovative water plasma-based propulsion system that is under development. forward-looking statements this press release contains certain statements which may constitute “forward-looking statements” within the meaning of the safe harbor provisions of the private securities litigation reform act of 1995. forward-looking statements include, but are not limited to, statements regarding momentus or its management team’s expectations, hopes, beliefs, intentions or strategies regarding the future, projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, and are not guarantees of future performance. the words “may,” “will,” “anticipate,” “believe,” “expect,” “continue,” “could,” “estimate,” “future,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “aim,” “strive,” “predict,” “project,” “should,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. forward-looking statements are neither historical facts nor assurances of future performance. instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of momentus’ control. many factors could cause actual future events to differ materially from the forward-looking statements in this press release, including but not limited to: the ability of the company to obtain licenses and government approvals for its missions, which are essential to its operations; the ability of the company to effectively market and sell satellite transport services and planned in-orbit services; the ability of the company to protect its intellectual property and trade secrets; the development of markets for satellite transport and in-orbit services; the ability of the company to develop, test and validate its technology, including its water plasma propulsion technology; delays or impediments that the company may face in the development, manufacture and deployment of next generation satellite transport systems; the ability of the company to convert backlog or inbound inquiries into revenue; changes in applicable laws or regulations and extensive and evolving government regulations that impact operations and business, including export control license requirements; the ability to attract or maintain a qualified workforce with the required security clearances and requisite skills; product service or product or launch failures or delays that could lead customers to use competitors’ services; investigations, claims, disputes, enforcement actions, litigation and/or other regulatory or legal proceedings; the effects of the covid-19 pandemic on the company’s business; the company’s ability to comply with the terms of its national security agreement and any related compliance measures instituted by the director who was approved by the cfius monitoring agencies (the “security director”); the possibility that the company may be adversely affected by other economic, business, and/or competitive factors; and/or other risks and uncertainties. these are only some of the factors that may affect the forward-looking statements contained in this press release. for a discussion identifying additional important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, see the company’s filings with the u.s. securities and exchange commission including, but not limited to, “management’s discussion and analysis of financial condition and results of operations” and “risk factors” in the company’s annual report on form 10-k for the year ended december 31, 2021 and subsequent quarterly reports on form 10-q. the company’s filings may be accessed through the investor relations page of its website, investor.momentus.space, or through the website maintained by the sec at www.sec.gov. forward-looking statements speak only as of the date they are made. readers are cautioned not to put undue reliance on forward-looking statements, and, except as required by law, the company assumes no obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise. second quarter 2022 financial results momentus inc. condensed consolidated statements of operations (in thousands, except share data) three months ended june 30, six months ended june 30, 2022 2021 2022 2021 service revenue1 $ 50 $ — $ 50 $ 130 cost of revenue2 12 — 12 48 gross margin 38 — 38 82 operating expenses: research and development expenses 10,896 20,794 20,867 30,700 selling, general and administrative expenses 12,861 9,740 27,714 23,744 total operating expenses 23,757 30,534 48,581 54,445 loss from operations (23,719 ) (30,534 ) (48,543 ) (54,363 ) other income (expense): decrease (increase) in fair value of safe notes — 100,803 — 182,367 decrease (increase) in fair value of warrants 2,254 4,454 1,803 12,537 realized loss on disposal of asset 1 — (69 ) — interest income 5 1 5 2 interest expense (1,413 ) (3,389 ) (2,905 ) (4,357 ) sec settlement — (7,000 ) — (7,000 ) other income (expense) — (8 ) 3 (187 ) total other income (expense) 847 94,861 (1,163 ) 183,362 income (loss) before income taxes (22,872 ) 64,327 (49,706 ) 128,999 income tax provision — 1 — 1 net income (loss) $ (22,872 ) $ 64,327 $ (49,706 ) $ 128,998 net income (loss) per share, basic $ (0.28 ) $ 1.25 $ (0.62 ) $ 2.36 net income (loss) per share, fully diluted $ (0.28 ) $ (0.59 ) $ (0.62 ) $ (0.90 ) weighted average shares outstanding, basic 81,319,533 51,474,305 80,642,670 54,620,299 weighted average shares outstanding, fully diluted 81,319,533 69,653,223 80,642,670 72,847,925 1 - prior year revenue recognized related to the cancellation of a customer contract, resulting in the forfeiture of a customer deposit 2 - prior year cost of revenue represents costs incurred related to one of the cancelled contracts. momentus inc. condensed consolidated balance sheets (in thousands) june 30, 2022 december 31, 2021 assets current assets: cash and cash equivalents $ 109,052 $ 160,036 restricted cash, current 1,005 197 prepaids and other current assets 7,517 9,431 total current assets 117,574 169,664 property, machinery and equipment, net 4,514 4,829 intangible assets, net 720 349 operating right-of-use asset 6,991 7,604 restricted cash, non-current 325 314 other non-current assets 3,650 3,065 total assets $ 133,774 $ 185,825 liabilities and shareholders’ equity (deficit) accounts payable $ 1,124 $ 1,911 accrued expenses 7,031 9,785 loan payable, current 10,113 20,907 contract liabilities, current 481 — operating lease liability, current 1,132 1,189 share repurchase liability 5,780 — other current liabilities 5,043 5,075 total current liabilities 30,704 38,867 contract liabilities, non-current 1,206 1,554 loan payable, non-current 8,544 — warrant liability 3,945 5,749 operating lease liability, non-current 6,716 7,284 other non-current liabilities 454 483 total non-current liabilities 20,865 15,070 total liabilities 51,569 53,937 shareholders’ equity (deficit): common stock, $0.00001 par value; 250,000,000 shares authorized and 83,264,832 issued and outstanding as of june 30, 2022; 250,000,000 shares authorized and 81,211,781 issued and outstanding as of december 31, 2021 1 1 additional paid-in capital 340,593 340,570 accumulated deficit (258,389 ) (208,683 ) total shareholders’ deficit 82,205 131,888 total liabilities and shareholders’ deficit $ 133,774 $ 185,825 momentus inc. consolidated statements of cash flows (in thousands) six months ended june 30, 2022 2021 cash flows from operating activities: net (loss) income $ (49,706 ) $ 128,998 adjustments to reconcile net income (loss) to net cash used in operating activities: depreciation and amortization 578 448 amortization of debt discount and issuance costs 1,462 3,357 amortization of right-of-use asset 613 661 decrease in fair value of warrants (1,803 ) (12,537 ) decrease in fair value of safe notes — (182,367 ) impairment of prepaid launch costs — 9,450 loss on disposal of fixed asset 69 — stock-based compensation expense 5,247 8,112 changes in operating assets and liabilities: prepaids and other current assets 1,914 (10,683 ) other non-current assets (585 ) (2,108 ) accounts payable (742 ) 2,696 accrued expenses (2,555 ) 2,454 accrued interest 53 — other current liabilities (6 ) 2,043 contract liabilities 133 450 lease liability (626 ) (50 ) other non-current liabilities 11 5,000 net cash used in operating activities (45,943 ) (44,077 ) cash flows from investing activities: purchase of property, machinery and equipment (488 ) (2,185 ) proceeds from sale of property, machinery and equipment 7 — purchases of intangible assets (464 ) (3 ) net cash used in investing activities (945 ) (2,187 ) cash flows from financing activities: proceeds from issuance of safe notes — 30,853 proceeds from issuance of loan payable — 25,000 proceeds from exercise of stock options 393 35 proceeds from employee stock purchase plan 190 — repurchase of section 16 officer shares for tax coverage exchange (97 ) — payment of loan payable (3,763 ) — payment of debt issuance costs — (144 ) payment of warrant issuance costs — (31 ) net cash provided by financing activities (3,277 ) 55,713 (decrease) increase in cash and cash equivalents (50,165 ) 9,449 cash and cash equivalents, beginning of period 160,547 23,520 cash and cash equivalents, end of period $ 110,382 $ 32,968 supplemental disclosure of non-cash investing and financing activities deferred offering costs in accounts payable and accrued expenses at period end $ — $ 370 deferred offering costs in loans payable at period end $ — $ 1,500 operating lease right-of-use assets in exchange for lease obligations $ — $ 8,501 share repurchase liability fair value $ 5,780 $ — supplemental disclosure of cash flow information cash paid for income taxes $ — $ 1 cash paid for interest $ 1,392 $ 1,000 reclassifications certain reclassifications have been made to the prior year’s financial statements to conform to the current year’s presentation. none of the reclassifications have changed the total assets, liabilities, shareholders’ deficit, income, expenses or net losses previously reported. use of non-gaap financial measures (unaudited) this press release references certain non-gaap financial measures, including adjusted ebitda, non-gaap selling, general, and administrative expense and non-gaap research and development expense. the company defines adjusted ebitda as earnings before interest expense, taxes, depreciation and amortization, stock-based compensation, and certain other items the company believes are not indicative of its core operating performance. the company defines non-gaap selling, general, and administrative expenses and research and development expenses as those respective gaap amounts, excluding stock-based compensation and non-recurring items not indicative of core operating performance none of these non-gaap financial measures is a substitute for or superior to measures of financial performance prepared in accordance with generally accepted accounting principles in the united states (gaap) and should not be considered as an alternative to any other performance measures derived in accordance with gaap. the company believes that presenting these non-gaap financial measures provides useful supplemental information to investors about the company that is helpful in understanding and evaluating its operating results, enhancing the overall understanding of its past performance and future prospects, and allowing for greater transparency with respect to key financial metrics used by its management in financial and operational-decision making. however, there are a number of limitations related to the use of non-gaap measures and their nearest gaap equivalents. for example, other companies may calculate non-gaap measures differently, or may use other measures to calculate their financial performance, and therefore any non-gaap measures the company uses may not be directly comparable to similarly titled measures of other companies. quarterly adjusted ebitda a reconciliation of adjusted ebitda to net loss for the three months ended june 30, 2022, june 30, 2021, and march 31, 2022, is set forth below: three months ended (in thousands) june 30, 2022 june 30, 2021 march 31, 2022 net income (loss) $ (22,872 ) $ 64,327 $ (26,836 ) income tax expense — 1 — interest income (5 ) (1 ) — interest expense 1,413 3,389 1,492 depreciation & amortization 284 249 294 ebitda (21,180 ) 67,965 (25,049 ) (decrease) increase in fair value of safe notes — (100,803 ) — (decrease) increase in fair value of warrants (2,254 ) (4,454 ) 451 realized loss on disposal of assets (1 ) — 70 sec settlement — 7,000 — prepaid launch deposit impairment — 8,700 — sec and cfius legal expenses 505 3,514 795 class action litigation legal expenses 600 — 795 other litigation legal expenses 170 — 114 sec compliance costs 36 — 2,135 nsa compliance costs 832 49 978 severance and other related expenses1 7 156 350 stock-based compensation 3,035 2,344 2,212 adjusted ebitda $ (18,250 ) $ (15,529 ) $ (17,149 ) 1 - loss contingencies for certain severance agreements were reversed when the company determined they would not be signed and paid a reconciliation of selling, general, and administrative expenses to non-gaap selling, general, and administrative expenses for the three months ended june 30, 2022, june 30, 2021, and march 31, 2022, is set forth below: three months ended (in thousands) june 30, 2022 june 30, 2021 march 31, 2022 selling, general, and administrative expenses $ 12,861 $ 9,740 $ 14,853 stock-based compensation 2,521 2,278 1,839 sec and cfius legal expenses 505 3,514 795 reduction in sec and cfius legal expenses due to fee dispute resolution — — — class action litigation legal expenses 600 — 795 other litigation legal expenses 170 — 114 sec compliance costs 36 — 2,135 nsa compliance costs 832 49 978 severance and other related expenses 7 76 — non-gaap selling, general, administration expenses $ 8,190 $ 3,823 $ 8,197 a reconciliation of research and development expenses to non-gaap research and development expenses for the three months ended june 30, 2022, june 30, 2021, and march 31, 2022, is set forth below: three months ended (in thousands) june 30, 2022 june 30, 2021 march 31, 2022 research and development expenses $ 10,896 $ 20,794 $ 9,971 prepaid launch deposit impairment — 8,700 — stock-based compensation 514 66 373 severance and other related expenses — 80 350 non-gaap research and development expenses $ 10,382 $ 11,948 $ 9,248
