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spk05: Hello everyone and welcome to the Terran Orbital first quarter 2022 earnings call. My name is Victoria and I'll be coordinating your call today. If you'd like to ask a question during the presentation, you may do so by pressing star 1 on your telephone keypad. If you wish to withdraw your question, please press star 2. If you have joined us online, please press the red flag icon. When preparing to ask your question, please ensure that your line is unmuted locally. I'll now pass over to your host, Molly Burke, to begin. Please go ahead.
spk06: Thank you, Victoria. Good morning, everyone, and thank you for joining Taran Orbital's first quarter 2022 earnings call. With me this morning are Mark Bell, founder, chairman, and chief executive officer of Taran Orbital Corporation, and Gary Hobart, chief financial officer of Taran Orbital Corporation. Mark will provide a business update and highlights for the quarter, and then Gary will give an overview of our results. Our executive team will then be available to answer your questions. During today's call, we may make certain forward-looking statements. These statements are based on current expectations and assumptions, and as a result, are subject to risks and uncertainties. Many factors could cause actual events to differ materially from the forward-looking statements made on this call. For more information about these risks and uncertainties, please refer to the risk factors in the company's filings with the Securities and Exchange Commission, each of which can be found on our website www.terranorbital.com. Readers are cautioned not to put any undue reliance on forward-looking statements, and the company specifically disclaims any obligation to update the forward-looking statements that may be discussed during this call. Please also note that we will refer to certain non-GAAP financial information on today's call. You can find reconciliations of the non-GAAP financial measures with the most comparable GAAP measures in our earnings press release. With that, I will turn the call over to Mark.
spk03: Thank you, Marlo, and good morning, and thank you for joining our first quarter 2022 earning conference call. This was a very exciting quarter at Terran Orbital. In late March, we went public and began trading on the New York Stock Exchange. We signed a record $162 million in new contracts and ended the quarter with a record backlog of over $220 million. Let me first give you an overview of the company for those of you who are new. We pioneered the space industry's small satellite revolution. We have been delivering small satellites to a broad mix of customers for over a decade, including NASA, Lockheed Martin, the Department of Defense, the intelligence community, the European Space Agency, and numerous commercial customers. What we do matters. We deliver in months. We deliver in months for millions of dollars solutions that used to take years and billions. Our satellites provide higher functionality, persistence, and faster product delivery. We have a broad mission mix including defense, telejudication, climate monitoring, disaster response, and space exploration. Terran Orbital is taking an industrial approach to building satellites at a massive scale. We serve an industry that is forecasted to launch approximately 50,000 satellites over the next decade, creating an enormous opportunity for companies with advanced, scalable, vertically integrated production capabilities. We operate from more than 250,000 square feet of office and production space and have over 370 employees today. Additionally, Terran Orbital is developing a next-generation satellite constellation that that will feature software-defined synthetic aperture radar, also known as SAR, which enables our satellites to image the Earth both day and night and in all types of weather. While we are still in the early stages, we are developing the compelling and differentiated solutions, which we will believe generate high-margin data products and services. Like I said before, we've had a very successful and exciting first quarter. Here are some of our highlights from our first quarter so far. First, we have focused on delivering constellations to complete customers' missions. In Q1, we delivered two Cicero satellites to GeoOptics and a Centuri 5 satellite to Fleet Space Technology. Since the quarter ends, we delivered Capstone to Advanced Space in support of NASA's Lunar Gateway, plus three satellites to NASA for CPOD and the Pathfinder Technology Demonstrator 3 mission. And earlier this week, we announced that we've delivered the first of 10 satellite buses to Lockheed Martin in support of the Space Development Agency's transport layer, Tranche Zero. Credit goes to our production and engineering teams for successfully delivering our customer satellites on time. We have a total of six satellites scheduled for launch on the SpaceX Transporter 5 launch this month, with another satellite to launch from New Zealand to lunar orbit. The successful delivery of customer satellites is our top priority. and we couldn't be more proud of our team. Second, we signed a record number of contracts in the quarter, totaling $162 million. We were awarded the company's largest contract ever by Lockheed Martin to build 42 satellites in support of the SDA transport layer in Tranche 1. This was following on an award to manufacture 10 satellites, which we're currently building, and deliver that for Tranche 0. We also announced a contract to build an additional three microsatellites for Lockheed Martin. These and other awards during the quarter led to a tripling of our backlog to a more than record $220 million. Third, we continue to build out manufacturing and operational capacity. We signed a 10-year lease at a 60,000 square feet next to our existing production and assembly facility in Irvine, California. We continue to make important additions to our leadership team and our highly skilled workforce. We are growing our headcount by about 10% a month, and we ended the quarter with more than 330 employees. Fourth, we advanced the development of our Earth observation constellation. We received the National Reconnaissance Office, BAA, for demonstration of our commercial radar image stream capability. The NRO is the buyer of space remote sensing data, for the intelligence community and the Department of Defense. And we see this NRO award as a stepping stone to larger program opportunities. We continue to assemble and test our first two synthetic aperture radar satellites and recently completed a range testing of our advanced radar array. Finally, the unprovoked invasion of Ukraine has created both geopolitical instability and humanitarian crisis for the Ukrainian people. Our company is unified in our mission to support the United States as allies and the people of Ukraine. I'm particularly proud of our team's early response to the conflict and delivering geospatial intelligence to help the Ukrainian people defend their homeland. After that exciting first quarter, we're looking forward to continued growth through the rest of 2022. We expect our new production facility in Irvine, California to be fully operational within Q3 2022. As far as satellite deliveries, our $220 million backlog represents a variety of missions that we are excited to deliver in the coming quarters. And also, as to those we've already mentioned, we are on track to deliver NASA's Pathfinder 4, an optical Earth observation satellite for an international commercial partner, a technology demonstrator for NASA with a laser communications terminal designed by MIT's Lincoln Laboratory, and a satellite with six electro-optical payloads to support weather observation for the Air Force Research Laboratory. And finally, showcasing our successful transition to multi-satellite programs, we expect to deliver all 10 satellites for Tronch Zero for the Space Development Agency's transport layer in 2022 while commencing work on the next 42 satellites for Tronch One. With that, I will now turn it over to our Chief Financial Officer, Gary Hobart, for an overview on our financials for the quarter. Gary?
spk02: Thank you, Mark, and good morning, everyone. Revenue for the first quarter was $13.1 million, a 25% increase year over year. On an LTM basis, we hit a company record $435 million of revenue for the 12-month period ending March 31, 2022. A 47% increase compared to the 12 months ending March 31st During the quarter, we executed on a growing mix of missions for defense, civil, and commercial customers. Meeting customer commitments is priority one, and in the face of supply chain pressures widely reported across the industry, Terran Orbital managed them well and successfully delivered satellites to its customers. We did, however, make adjustments to our projected EACs on certain firm fixed-price contracts. EAC adjustments reduced revenue by approximately $3 million in the quarter. As a reminder, we recognize revenue on most of our programs on a percentage of completion basis, and changes in the EAC have a cumulative catch-up impact in the period in which we make the adjustment. Adjusted gross profit for the quarter was negative $0.2 million, down from $1.2 million in the prior year. The EAC adjustments previously mentioned reduced adjusted gross profit by approximately $3.7 million. This includes $3 million from the revenue impact and another $0.7 million of contract loss reserves. Adjusted EBITDA was negative $14.7 million compared to negative $3.6 million in the same period in the prior year. The decrease in adjusted EBITDA was due to the change in adjusted gross profit as well as increases in labor, facilities, professional fees, and other corporate costs related to the expansion in our capacity and the process of becoming a public company. Finally, we are pleased to have successfully closed our merger with Tailwind II Acquisition Corp. on March 25th, despite a difficult equity market backdrop. We thank our capital partners for their ongoing trust in us and in support of our mission. The transaction resulted in the issuance of $255 million in equity and debt securities, consisting of $80 million of equity split between SPAC, cash and trust, and PIPE, and $175 million of new and rollover debt. Other than PIPE payment obligations due in the remainder of 2022, we have no material debt maturities until 2026. At quarter end, we had approximately $77 million of cash and $137.3 million of shares outstanding. We finished the quarter with approximately $222 million in backlog, and we are tracking a pipeline of 140 identified opportunities with more than $12 billion in value. The company's near-term focus is on the successful execution of our customer programs and winning new contracts to expand our backlog. Accordingly, the company plans to contribute significant resources to continue to expand its manufacturing capacity, vertically integrate and expand our ever-growing exceptional pool of talent. In addition, we continue to assemble and test our first two synthetic aperture radar satellites. Our SAR constellation represents highly attractive economics, and we are pursuing the opportunity consistent with our available capital resources. At present, we are targeting capital expenditures for 2022 in the range of $15 million to $20 million. I will now turn the call back over to Mark.
spk03: Thank you, Gary. And thank you everyone on the call for your continued support of our company. If you want more information about the company, please go to www.terranorbital.com. And now I look forward to taking your questions. I'm going to turn it back over to the operator. Great. And I now turn it back over to the operator.
spk05: Thank you. We will now start our Q&A session. If you'd like to ask a question, please press star followed by one on your telephone keypad. If you have joined us online, please press the red flag icon. When preparing to ask a question, please ensure that your line is unmuted locally. And our first question comes from Greg Conrad at Jefferies. Please go ahead. Your line is open.
spk01: Good morning.
spk00: Just maybe to start, you touched on it a little bit, but post-Ukraine, it seems like the budget conversation has changed, with part of that being kind of rapid advance in space budgets and just appetite to integrate commercial intelligence into the workflow. What are you seeing on the SAR side, just thinking about demand and conversations with your customers, and maybe how does that alter the ability to satisfy that demand given flexibility around demand? bring capacity online.
spk03: You know, I mean, we've seen Ukraine as a perfect as really has validated the need for additional ISR capabilities, especially with synthetic aperture radar. If you keep in mind, you know, the Russian military pretty much only moved at night. So traditional, like your observant gene was useless in helping Ukrainian government. But with it was far that we were able to we were able to identify and help the Ukrainian government defend Kiev and help stop the Russians in their tracks. So Tsar has played an enormous, enormous, enormous help in this battle in the Ukraine, and it's demonstrated the validity of why Tsar is so important.
spk00: And then you refrained from giving 22... revenue guidance but had provided a 22 framework kind of pre-emerger when we think about that 94 million for satellite solutions has anything changed around timing of contracts or the supply chain pressures that you called out just kind of thinking about how this year plays out you know we have you know we we you know we look we look at our supply chains uh we continue to improve on a supply chain work on it you know the risks are always still there
spk03: You know, we have continued to add contracts and add customers, and we're very pleased at the rate that we're adding contracts and new customers. Our focus right now is to deliver SDA scratch zero, deliver it on time. That is a key metric for us internally, and we are highly confident we will be able to do that.
spk00: And then maybe just sneaking in one last multiple part question, but I mean, just on our math, if we look at the Tron 1 award, it maybe comes out to $3 million per satellite. How do you think about ASP in general trending, or at least for modeling purposes, what's kind of a good placeholder number? And then kind of as it relates to that, we hear a lot about these new mega constellations coming to market, and I'd assume you're in the running for anything that is set out. Any sense of make versus buy and kind of what you're seeing in terms of for some of these mega constellations versus others that have maybe produced stuff in-house?
spk02: Sure. So we don't disclose revenue per satellite per se. We have its history, had satellites that have been built for as little as $1 million per satellite, and some that are over $10 million per satellite. So we have a pretty broad range. A lot of it depends on the features of the satellite, including payloads. I think that the $3 million number you've mentioned is probably at the middle to lower end of the range as far as average. I might suggest that it's anywhere from $3 to $4 million on a basic bus and avionics that excludes payload. And so I think that's a good reference point for you to use.
spk03: And on the mega constellations, you are correct. There are many people out there, both governmental and civil and commercial, Looking at large constellations, we are actively talking to a number of potential customers. We're looking at our production capabilities we're able to do. That's why we're expanding as we see that being the future. And it's an exciting time for us with all these people, with everybody out there looking to build constellations to solve different problems here on Earth.
spk00: Thank you.
spk05: Perfect. Thank you so much for your question. Our next question comes from Rupert Spingham at Milius Research. Please go ahead. Your line is open.
spk12: Hey, good morning. Good morning.
spk02: Mark, I wanted to ask you about, to add a little color if you could, on the status of the two Predastar satellites. I think either you or Gary said they were in testing, but when is the plan to get those on orbit? And then I have a couple follow-ups.
spk03: Sure. The antennas are pretty much complete. We've been testing them, and it's looking fabulous. We are working on the buses now. We want to get the SDA's programs out first. That is our top priority. And then we'll get our two birds up in the air. And it's just a matter of prioritizing. The Space Development Agency made it very clear. If you look at last week, Paula Trimble, the policy chief of the SDA, declared we aren't going to pick the winners, the winners are going to deliver, quote unquote. Basically informing us that those who deliver on time will be the winners of the future constellation.
spk02: So what is on time for you here? What should we be looking for in terms of the calendar as the year progresses?
spk03: The SDA has a date with delivery dates that we can let them disclose. But as you see, we just announced we delivered bus zero. You'll see soon we will announce bus one. And as we announce the buses that will be going up, the first five, as we do these in fives, those are key metrics, those announcements. Okay. Okay, fair enough. Gary, you guided to CapEx.
spk02: I think Irvine is going to be up and running, you said, in the third quarter. Mark may have said that. With the cash burn in Q1, how should we think about cash burn going forward as the company gets bigger, as you spend that CapEx, and given your current balance sheet? We are managing our capital and capital allocation with existing cash. to work through the balance of the year and into the new year. So that'll give you a rough estimate of how, with roughly $77 million of cash to start this April period and going into the second quarter, that should give you a rough approximation of how we're managing our cash. And yes, the Irvine facility and a little bit in Santa Maria where we have our machine shop will be a portion of our CapEx. The CapEx also includes the continued development of our Earth observation constellation and some smaller projects including ERP system, some automation and other things that are built around really trying to accelerate our capacity on satellite builds. Okay, and then just a detailed question. Within the backlog, the 222, how much of that is fixed price versus cost plus? We haven't given an exact breakdown on that, but the majority of our contracts, in fact, probably the super majority, are fixed price contracts, and that's as much as we can say.
spk03: Yeah, you usually work with contracts. When you're working on developing it, it's sometimes a cost plus, but then when you get the constellation, it turns into fixed price. At the end of the day, all the big stuff is all fixed price. But just like a house, when they make changes to it, we make changes to the contract for additional compensation.
spk02: Okay, and then I just was going to ask, how does inflation factor in here? Are there any protections, or do you have to eat any increase in cost on the fixed price portion of the work?
spk03: We're building these things so fast, inflation really doesn't play a part into it. It plays a part. We obviously continue to adjust our prices annually for inflation, but it really doesn't play a big part into it at this point. The bigger issue usually is supply chain and things becoming commoditized. But as more and more things we manufacture in-house, as we're about to move forward with building our loans, printed circuit board assembly facility. That will be our next big thing of vertically integrating.
spk05: Okay.
spk02: Thanks so much.
spk05: Perfect. Thank you so much for your question. Our next question comes from Josh Sullivan at Benchmark Company LLC. Please go ahead. Your line is open.
spk11: Good morning. Good morning, Josh. Just looking at the headcount now, and the back half in hand, where do you think headcount will be at the end of the year as you scale up or order a magnitude?
spk03: We've been increasing our headcount approximately 10% a month, give or take. We feel it's as much as we can absorb. We're trying to be very logical, methodical how we add headcount as we have to be able to absorb them in an orderly fashion. We get judged when we're bidding on programs. Our clients look at our headcount and they look at our square footage and the amount of assembly space that we have. And so that's why we're rapidly adding more space and people. But we're doing it in a very controlled fashion. We're not trying to go out and just add thousands of people all at once.
spk10: Got it. And then as far as the Florida manufacturing facility, can you update us on any progress there or just where we stand?
spk03: Yes, so I just spoke with Space Florida the other day. They are negotiating with their banks because they were waiting for us to go public in order for them to continue to close the transaction. We are, hopefully very soon, we should get some answers back as to when we'll have a closing date. But we are right now at the mercy of Space Florida for them to do what they need to do. Once their financing is in place, then we'll get our leak and we'll be all set.
spk10: And then just one last one, just on the EAC adjustments, did you mention what the driving factors were there or which programs?
spk03: Can you repeat the question, please? I'm sorry. I couldn't hear the beginning.
spk10: On the EAC adjustments, did you mention factors were there for which programs they were on? Gary?
spk02: Yeah, so the EAC adjustments with certain of our fixed price contracts, We have not identified the, broken it out by program.
spk10: Thank you for the time. Thank you.
spk05: Thank you so much for your question. Our next question comes from Austin Morella at Concord Genuity. Please go ahead. Your line is open.
spk12: Good morning, Mark and Gary.
spk03: Good morning, Austin. Morning.
spk12: So just my first question here, if I remember correctly from the investor deck, it's sort of two Predasar satellites going up this year, and then your total should be 16 next year, which would imply 14 going up next year. So with the $77 million in cash and the $175 million in new debt, I remember it's about $20 million apiece for each satellite, but of course that includes the launch costs and the lifetime operating costs. So is it still your intent to launch 14 Predasaur satellites next year?
spk02: So what we're doing right now is we are still pursuing our constellation with the first two satellites, but we're also mindful of our capital resources. So until we see where we stand on capital to pursue the opportunity, which we see is very attractive, we're limiting our schedule to the first two satellites. And the capital will really drive the next decision on that. We have not updated the capital cost per satellite, but directionally we still see them as basically $10 million apiece to launch and build, and then they operate over five years at about $2 million per year. And so hopefully that answers your question.
spk12: Yeah, that's super helpful. And then just sort of a follow-up here. I saw you guys book the Transporter 6 SpaceX mission, but I was just trying to clarify, will one of the Predasar satellites this year go on that rocket, or will it be both of them?
spk03: We're still working on that. Right now we're prioritizing the SDA Trunch Zero. That is our absolute priority. That program is very important to the DOD. and we want to make sure that gets out first and we're looking at opportunities then to to utilize the tranche one bus to dramatically lower the cost of the constellation so we'll need less capital in order to build it so uh this is all this is all happening in real time for us now as the s the sda put out that story uh we we and we hear we hear it loud and clear from other conversations we have with lachi martin that delivering sba on time is incredibly important and so that's our priority but we're still working on ways to launch and keep one beyond the first two satellites it's very important we get those up as well there's a little bit of juggling act but we're trying to make sure that we do that we're delivering for our fda first and foremost right yeah i would definitely think that that sda is a major priority there so just thanks for all the details no thank you we look at the opportunity for sda and for And we want to prove to them that we can do this. So as we did on tranches two, three, and four, they have a good experience with us with tranches zero and one. And as you know, there are 684 satellites, I believe, being planned just for the transport layer. And those have to get replenished every five years. So for us, that's a multibillion-dollar opportunity over the next decade.
spk12: Definitely sounds very exciting. Thanks to all the callers.
spk04: Thank you.
spk05: Thank you so much, Austin, for your question. And as a reminder, if you would like to ask a question, please press star followed by one on your telephone keypad. And our next question comes from Suji Da Silva at Wolf Capital Partners LLC. Please go ahead. Your line is open.
spk08: Hi, Mark. Hi, Gary. Good morning. Congratulations on the progress here. So, guys, what is the – What metrics are the best way to think about the way you're growing capacity in the next one to two years? Maybe you can help us understand what the best way to think about that is, satellites or number of satellites or square feet or whatever.
spk03: That's actually a great question. So what we do is by the time we get a program, it's too late for us to hire people and to add capacity. So we do is we're adding capacity ahead of programs that we have added and adding people ahead of programs that we have a very high degree of confidence we will be winning. So as you see us finding more leases or as you see us, uh, heart hiring more people, that is a solid indicator of programs that we expect to be winning. So we're not just building space for the sake of building space. We're building space because we're talking to customers. about constellations that they wish to build, and we need to have enough space to assemble them and enough people to build them.
spk08: That's very helpful insight. Thank you, Mark. And a question about Predasar, maybe it's not the case, but I'm wondering, do you have visibility ahead of your satellite constellation launches there from customers who are kind of pre-buying or indicating pre-buys of the service or capacity, or does that happen as you start to put the satellites in space?
spk03: It'll happen once they launch, but the Ukraine has really demonstrated the need for synthetic aperture radar. It has really solidified why it's so important, and we're seeing lots of inquiries from customers about other things, other types of things we could do with SAR and other advances to different SAR products.
spk08: Okay, great. Thanks, Mark. Good job on the progress, guys. Thanks, Ken.
spk03: Thank you.
spk05: Perfect. Thank you so much for your question, Suji. And our next question comes from Eric Russellman at Stifel. Please go ahead.
spk09: Yeah, guys. Thanks. And I'll echo good progress on the quarter. Wanted to just ask on the Irvine facility, sounds like that's coming online in Q3, but Where are you at in terms of having capacity for that on that initial opening? And what does that facility look like once it's at full build?
spk03: So it's a 60,000-foot facility. 20,000 square feet of it actually comes online by about Memorial Day. The other 40,000 square feet will be later this year. So the production side of the facility where we do manufacturing of the products will come online by Memorial Day. The assembly side of that house will come to 40,000 square feet of high bay assembly will come online by Q3.
spk04: Okay.
spk03: We manufacture components first, and then we assemble them. So we're building up the building by components first, and then assembly. But keep in mind, we only signed this lease, I believe, in February, and we've already finished 20,000 square feet. And we're also putting in robotics for the first time in this facility. So we will be building a robotic assembly line for components in this facility. It will be the first time we're doing this.
spk10: Got it.
spk09: And then maybe just on the supply chain headwinds, You sounded like you were okay on the inflationary side, but on the supply chain side, there's obviously impacts being felt in all industries. What are you doing proactively in order to sort of stay ahead? Maybe just talk about some of the things that the other team has been doing to sort of fight off that headwind.
spk03: We try to order things in advance as far as possible. We're obviously looking at M&A as a possible solution to some of these issues. You know, there's a lot of opportunities out there, and we want to continue to vertically integrate. So we want to continue to, you know, right now we make 85% of our components in-house. I committed to make 100% of our components in-house over the next 36 months. We are working a way to move that timeline up as fast as possible. The only thing we won't make in-house are our solar panels, which we acquired from Lockheed Martin. They're doing an exquisite job of it at a great price. But, you know, everything else we want to go make in-house over the next 36 months. And then we will get to it. It's just case in point is we own our own machine shop now. We're now expanding our own machine shop. Everything is aerospace aluminum on a satellite. We make that all in-house. And now we're moving on putting in robotic loaders into all our CNC machines. So we can literally run 24-7, 365. And so as we get bigger, also, we have more influence over our vendors. And so we'll be able to move up the food chain, as we say. So we're feeling pretty good about it. But unfortunately, with COVID and everything that's happened in this world, we can never guarantee anything. But we are doing our best to mitigate it as best as possible.
spk09: All right. And then maybe just on the competitive landscape, have you seen any interesting companies emerge recently? Any changes in your expectations for this market or your position, especially around SAR and then just on the satellite manufacturing side?
spk03: You know, we see lots of new companies starting up all the time. We're working on a number of VLEO projects, which is very interesting, very low Earth orbits. As you know, as you get closer to the Earth, you can take a higher quality image. So that's been very interesting. We are working on, we're seeing people who are calling it nuclear in space, nuclear propulsion, and that's been very interesting to listen to people talking about it. So there's a lot of money being invested in space startups, and the money we're seeing being invested is being smarter, no longer focusing on pie in the sky, for more practical application. And, you know, high-resolution ISR, faster communications, OISL is going to be a thing of the future. So we have a contract to put an OISL on one of our predatory satellites, which will connect to DARPA, DARPA's Blackjack program. But if you think about it, all the future transport layers will all have OISL as well. So that is the communication link of the future in space. Great. Helpful. Thank you. Good luck. One thing also to point out is, you know, the Space Force got a significant $7 billion fiscal year 23 budget increase. You know, this represents tangible evidence of bipartisan support to recapitalize our nation's strategic space assets and a deliberate pivot to more resilient and defendable architecture. This 40% budget increase, you know, is concentrated on the and the procurement, which expands the available market for Terran Orbital.
spk09: Sounds good. Thanks for all that. Good luck. Thank you very much.
spk05: Thank you so much, Eric, for your question. And as a reminder, if you would like to ask a question, please press star followed by one on your telephone keypad. And our next question comes from Ruben Boy at West Park Capital. Please go ahead. Your line is open.
spk07: hi thank you mark um uh yes good great job on the progress i i you touched on um most of my questions but i wanted to just um go back to something you said around ukraine and validation of um some of the uh efforts that you guys have been working on for a while now and in addition to sar just wondering you know in your discussions with your customers have you seen uh you know over the last 90 days or so any significant changes in sort of um you know, kind of looking for the sort of technologies or any changes to the design architectures, et cetera. I'm just thinking about around ISR and if you're seeing any significant changes on, you know, what your customers are looking out, you know, to build over the next 18, 24 months. Thanks.
spk03: Sure. I mean, on the Ukraine side, you know, the Ukraine is demonstrating the resiliency of small satellite constellations. General David Thompson testified just this week at the Senate Armed Services Committee that despite Russia's desire to prevent Ukraine from using space-based capabilities, their inability to do that is quite a reflection of these new proliferated architectures that are very difficult to deny overall. I mean, this validates Space Force's architecture. And we are seeing lots of new money being put in and lots of new interest in space you know, advancing SAR to the next level, advancing electrical obstacles to the next level. There's some amazing new technologies being developed that will revolutionize your ISR space. Got it. Okay.
spk07: And then just a quick follow-up to Gary.
spk03: And I'd like to add, I'm sorry, I don't mean to interrupt, sorry. But I'd like to add, you know, when I say exciting new technologies, we are at the center of not only these conversations, But we're actually in the center of being able to manufacture and produce some of these products for the DOD and the IC community. So, you know, we have incredible foresight with the knowledge that we do and the programs that we have internally.
spk07: That's great. Thanks, Mark. And I guess this is for you, Andari. You mentioned that inflation really doesn't bear on, you know, sort of the way you guys are operating. But just in terms of the supply chain pressures and, how to think about EAC charges, if any, the magnitude. How do you think about that as you look out into the next couple of quarters?
spk02: Yeah, well, I think that weighed very heavily on our adjustments to EAC that we announced in the first quarter. I think the supply chain generally impacts, quite frankly, the timing and sequencing of our builds. Each of the satellites kind of has about 50 different unique components about 20 different unique modules and 50 modules overall. If you have one component that's delayed or missed, you really can throw off your entire build cycle. So I echo Mark's comment that inflation doesn't bear upon us because of the build cycles. We're turning around most of our programs in 18 to 24-month periods from the date of signing. So it is relatively quick from pricing to award to fulfillment. But we are mindful of supply chain because of the impact it has on just our build cycle. And that's a big driver of how we thought about our overall program, life of program cost. And again, that was reflected in the adjustment we did in the first quarter. Right.
spk07: Okay. Thank you, Garrett.
spk05: Thank you so much for your question, Ruben. At this time, there are no further questions. And I would like to pass back over to Mark for any final remarks.
spk03: Uh, sure. Well, I just want to thank you for coming today. Uh, we are, you know, we have a very, we had an exciting quarter. We have a lot of exciting stuff coming up in the future. Uh, we appreciate everybody's, uh, support and I'm just going to turn it over to Gary just for some closing remarks.
spk02: Yeah, sure. Thanks Mark. Um, uh, I think we're excited about the process going forward as a company. We've got over $220 million of backlog to start the second quarter. a $12 billion pipeline that we are pursuing to add to that. I did want to make a clarification because there may have been audio issued during my portion of my presentation. Our LTM revenue was $43.5 million for the 12-month period ending March 31st, 2022. That represents a 47% increase from the 12-month period ending March 31st, 2021. So I just wanted to clarify that for the call.
spk03: Great. And with that, we thank everybody. Gary and I are available if you have questions at any time. We appreciate everybody showing up today, and we wish everybody to have a good weekend. Thank you for joining us.
spk05: Thank you, everybody, for joining today's call. You may now disconnect your line.
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