Momentus inc. announces third quarter 2022 financial results
San jose, calif.--(business wire)--momentus inc. (nasdaq: mnts) (“momentus” or the "company”), a u.s. commercial space company that offers transportation and other in-space infrastructure services, today announced its financial results for the third quarter ended september 30, 2022. momentus chief executive officer john rood made the following comments about the quarter: “this was another eventful quarter at momentus. our talented engineering and operations team made solid progress during the quarter in our research and development efforts taking important strides toward our goal of being a leading provider of space infrastructure services that will enable the new space economy. momentus placed five additional satellites in orbit during the quarter, successfully completed assembly and test of our next generation orbital service vehicle (osv), vigoride 5, for launch on the spacex transporter-6 mission targeted for next month, and advanced development of key technologies, such as our innovative and environmentally-friendly microwave electrothermal thruster (met) that uses water as a propellant.” “we’re excited to be supporting some truly innovative work that will advance the technology boundaries in space. next month, we are planning for vigoride 5 to begin a several month mission that includes a hosted payload from caltech that aims to demonstrate the ability to collect solar energy in space and transmit it to earth. their aim is to provide a new ground-breaking and environmentally-friendly way to meet energy needs on earth.” “momentus is also thrilled to have signed a contract modification with nasa to transport two cube satellites that will perform cutting-edge research on weather events in space. this marks a big milestone in our efforts to grow into the government market, which is an area we are prioritizing and see substantial opportunities for further growth.” third quarter 2022 business highlights: the company’s vigoride 3 orbital service vehicle (osv) deployed five customer satellites during the third quarter of 2022, bringing the cumulative number of customer satellite deployments from vigoride 3 to seven and the total number of momentus customer satellites deployed from all platforms to eight. applied lessons learned from the inaugural vigoride mission to the next generation vigoride 5 osv in preparation for its planned launch on the spacex transporter-6 mission, which is targeted for december 2022. conducted an expanded ground-testing campaign on vigoride 5 and its component systems, including simulated zero-gravity deployment testing of the solar array that will power vigoride 5, and ground hot fire testing of vigoride 5’s next-generation microwave electrothermal thruster (met) propulsion module. completed ground vibration testing of the complete vigoride 5 osv to simulate the environment that it will experience on the spacex falcon 9 launch vehicle. subsequent to the close of the third quarter, momentus completed thermal vacuum testing of vigoride 5, which simulates the environment that it will encounter in space and concludes the overall vigoride 5 environmental testing campaign. subsequent to the close of the third quarter, integrated customer satellites onto vigoride 5, completed its flight readiness review and are preparing to ship the vehicle to its launch site in cape canaveral, fl. signed a contract with a new commercial customer ohb luxspace to conduct a hosted payload mission. signed a contract modification with nasa’s kennedy space center for transportation of two satellites to custom orbits. this mission highlights the unique capabilities of momentus' osv to transport a customer satellite from the launch vehicle's standard drop-off orbit to its desired custom orbit. the nasa mission will perform cutting-edge research on space weather and momentus is proud to provide the custom capabilities needed to support this work. signed a memorandum of understanding with sidus space, under which momentus will collaborate and provide transportation and payload-hosting services for its lizziesat satellites. put in place the framework for future capital raising efforts by filing an s-3 universal shelf registration statement with a ceiling of $200m and launched a three-year, $50m at-the-market equity program. conference call information momentus inc. will host a conference call to discuss the results today, at 5:00 p.m. eastern time (2:00 p.m. pacific time). to access the conference call, participants should dial +1 (800) 715-9871 and enter the conference id number 3659704. 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 offers 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, investors.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. third quarter 2022 financial results momentus inc. condensed consolidated statements of operations (in thousands, except share data) three months ended september 30, nine months ended september 30, 2022 2021 2022 2021 service revenue1 $ 129 $ 200 $ 179 $ 330 cost of revenue2 14 (184 ) 26 (135 ) gross margin 115 384 153 465 operating expenses: research and development expenses 10,571 9,047 31,438 39,747 selling, general and administrative expenses 11,184 12,057 38,898 35,802 total operating expenses 21,755 21,104 70,336 75,549 loss from operations (21,640 ) (20,721 ) (70,183 ) (75,084 ) other income (expense): decrease (increase) in fair value of safe notes — 26,924 — 209,291 decrease (increase) in fair value of warrants 1,579 (2,712 ) 3,382 9,826 realized loss on disposal of asset (45 ) — (114 ) — interest income 28 — 33 2 interest expense (1,261 ) (4,328 ) (4,166 ) (8,685 ) sec settlement — — — (7,000 ) other income (expense)3 41 (4,778 ) 44 (4,965 ) total other income (expense) 342 15,107 (821 ) 198,469 income (loss) before income taxes (21,298 ) (5,614 ) (71,004 ) 123,385 income tax provision — — — 1 net income ( loss) $ (21,298 ) $ (5,614 ) $ (71,004 ) $ 123,384 net income ( loss) per share, basic $ (0.26 ) $ (0.09 ) $ (0.88 ) $ 2.06 net income ( loss) per share, fully diluted $ (0.26 ) $ (0.09 ) $ (0.88 ) $ 1.92 weighted average shares outstanding, basic 82,066,795 60,589,566 81,122,541 59,873,199 weighted average shares outstanding, fully diluted 82,066,795 60,589,566 81,122,541 64,232,537 1 - prior year revenue recognized related to the cancellation of customer contracts, resulting in the forfeiture of customer deposits 2 - the reduction of cost of revenue represents the reversal of a contingency recorded during the prior year for loss contracts related to free slots on future missions. during the prior three months ended september 30, 2021, the company signed amendments or terminations with those customers such that the services will no longer be free of charge. the reversed contingency was offset by costs incurred related to one of the cancelled contracts. 3 - other expenses during the three months ended september 30, 2021 were due to the transaction costs allocated to the liability-classified warrant assumed in connection with the business combination. momentus inc. condensed consolidated balance sheets (in thousands) september 30, 2022 december 31, 2021 assets current assets: cash and cash equivalents $ 81,570 $ 160,036 restricted cash, current 287 197 prepaids and other current assets 10,939 9,431 total current assets 92,796 169,664 property, machinery and equipment, net 4,333 4,829 intangible assets, net 343 349 operating right-of-use asset 6,715 7,604 deferred offering costs 309 — restricted cash, non-current 310 314 other non-current assets 3,894 3,065 total assets $ 108,700 $ 185,825 liabilities and shareholders’ equity (deficit) accounts payable 1,596 1,911 accrued expenses 7,881 9,785 loan payable, current 10,844 20,907 contract liabilities, current 1,226 — operating lease liability, current 1,140 1,189 stock repurchase liability 10,000 — other current liabilities 110 5,075 total current liabilities 32,797 38,867 contract liabilities, non-current 1,178 1,554 loan payable, non-current 5,583 — warrant liability 2,367 5,749 operating lease liability, non-current 6,425 7,284 other non-current liabilities 459 483 total non-current liabilities 16,012 15,070 total liabilities 48,809 53,937 commitments and contingencies (note 12) shareholders’ equity (deficit): common stock, $0.00001 par value; 250,000,000 shares authorized and 83,984,571 issued and outstanding as of september 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 339,576 340,570 accumulated deficit (279,686 ) (208,683 ) total shareholders’ deficit 59,891 131,888 total liabilities and shareholders’ deficit $ 108,700 $ 185,825 momentus inc. consolidated statements of cash flows (in thousands) nine months ended 2022 2021 cash flows from operating activities: net (loss) income $ (71,004 ) $ 123,384 adjustments to reconcile net (loss) income to net cash used in operating activities: depreciation and amortization 831 768 amortization of debt discount and issuance costs 2,114 6,935 amortization of right-of-use asset 889 971 decrease in fair value of warrants (3,382 ) (9,826 ) decrease in fair value of safe notes — (209,291 ) impairment of prepaid launch costs — 9,450 loss on disposal of fixed and intangible assets 121 — stock-based compensation expense 8,564 11,187 changes in operating assets and liabilities: prepaids and other current assets (1,571 ) (15,350 ) other non-current assets (901 ) (677 ) accounts payable (328 ) 4,357 accrued expenses (1,873 ) 4,546 accrued interest 92 — other current liabilities (4,967 ) 4,829 contract liabilities 851 (1,071 ) lease liability (908 ) (115 ) other non-current liabilities (23 ) 5 net cash used in operating activities (71,495 ) (69,897 ) cash flows from investing activities: purchases of property, machinery and equipment (618 ) (2,835 ) proceeds from sale of property, machinery and equipment 7 — purchases of intangible assets (30 ) (16 ) net cash used in investing activities (641 ) (2,852 ) 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 517 278 proceeds from employee stock purchase plan 190 — repurchase of section 16 officer shares for tax coverage exchange (265 ) — payment of loan payable (6,686 ) — payment of debt issuance costs — (144 ) payment of warrant issuance costs — (31 ) payment for repurchase of common shares — (40,000 ) proceeds from issuance of common shares in pipe — 110,000 payments of issuances costs related to pipe — (4,416 ) proceeds from issuance of common stock upon business combination — 128,167 payments for issuance costs related to business combination — (21,285 ) net cash (used in) provided by financing activities (6,244 ) 228,421 (decrease) increase in cash, cash equivalents and restricted cash (78,380 ) 155,672 cash, cash equivalents and restricted cash, beginning of period 160,547 23,520 cash, cash equivalents and restricted cash, end of period $ 82,167 $ 179,191 supplemental disclosure of non-cash investing and financing activities issuance of common stock related to conversion of safe notes $ — $ 136,001 issuance of common stock related to exercise of warrant liabilities $ — $ 6,999 reclassification of deferred offering costs $ — $ 2,610 deferred offering costs in accounts payable and accrued expenses at period end $ 238 $ — assumption of merger warrants liability $ — $ 31,225 operating lease right-of-use assets in exchange for lease obligations $ — $ 8,501 stock repurchase liability fair value $ 10,000 $ — supplemental disclosure of cash flow information cash paid for income taxes $ — $ 1 cash paid for interest $ 1,960 $ 1,750 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 september 30, 2022, september 30, 2021, and june 30, 2022, is set forth below: three months ended (in thousands) september 30, 2022 september 30, 2021 june 30, 2022 net income (loss) $ (21,298 ) $ (5,614 ) $ (22,872 ) interest income (28 ) — (5 ) interest expense 1,261 4,328 1,413 depreciation & amortization 253 320 284 ebitda (19,812 ) (966 ) (21,180 ) (decrease) increase in fair value of safe notes — (26,924 ) — (decrease) increase in fair value of warrants (1,579 ) 2,712 (2,254 ) realized loss on disposal of assets 45 — (1 ) transaction costs allocated to warrant liability — 4,780 — sec and cfius legal expenses 279 2,188 505 class action litigation legal expenses 621 54 600 other non-recurring litigation legal expense 447 — 170 sec compliance costs 20 — 36 nsa compliance costs 487 882 832 severance and other non-recurring expenses1 90 (7 ) 103 stock-based compensation 3,289 3,075 3,035 adjusted ebitda $ (16,113 ) $ (14,206 ) $ (18,154 ) 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 september 30, 2022, september 30, 2021, and june 30, 2022, is set forth below: three months ended (in thousands) september 30, 2022 september 30, 2021 june 30, 2022 selling, general, and administrative expenses $ 11,184 $ 12,057 $ 12,861 stock-based compensation 2,552 3,023 2,521 sec and cfius legal expenses 279 2,188 505 class action litigation legal expenses 621 54 600 other non-recurring litigation legal expense 447 — 170 sec compliance costs 20 — 36 nsa compliance costs 487 882 832 severance and other non-recurring expenses 52 — 103 non-gaap selling, general, administration expenses $ 6,726 $ 5,910 $ 8,094 a reconciliation of research and development expenses to non-gaap research and development expenses for the three months ended september 30, 2022, september 30, 2021, and june 30, 2022, is set forth below: three months ended (in thousands) september 30, 2022 september 30, 2021 june 30, 2022 research and development expenses $ 10,571 $ 9,047 $ 10,896 prepaid launch deposit impairment — — — stock-based compensation 737 52 514 severance and other related expenses1 38 (7 ) — non-gaap research and development expenses $ 9,796 $ 9,002 $ 10,382 1 - loss contingencies for certain severance agreements were reversed when the company determined they would not be signed and paid _______________
