Terran Orbital Corporation

Hello and welcome to the Terran Orbital first quarter 2023 earnings call. My name is Elliot and I'll be coordinating your call today. If you would like to register a question during the presentation, please press star followed by one on your telephone keypad. I'd now like to hand over to Jonathan Sigmund, Senior Vice President of Corporate Development. The floor is yours. Please go ahead.

Thank you, Elliot. Good morning, everyone. Thank you for joining Terran Orbital's first quarter 2023 earnings call. With me this morning, I'm Mark Bell, co-founder and chairman and chief executive officer of Terran Orbital Corporation, and Gary Hobart, chief financial officer of Terran Orbital Corporation. Mark will provide a business update and highlights of the past quarter, and then Gary will review the quarterly results. Terran Orbital's 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 our current expectations and assumptions, and as a result, are subject to risk and uncertainty. Many factors could cause actual events to differ materially from forward-looking statements made on this call. For more information about these risks and uncertainties, please refer to 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 statement 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 for the non-GAAP financial vendors with the most comparable GAAP measures in our earnings press release. With that, I will turn it over to Mark.

Thank you, John. And thank you, everyone, for joining our first quarter 2023 earnings conference call. I am excited with our year-to-date performance, especially our order flow. A new, even broader mix of customers are increasingly looking to turn Orbital for the design and manufacturing of their satellite constellation and new space-based projects. Customers are choosing us because of our 10-year-plus track record of success, our state-of-the-art design and mission breadth, our rapid-paced increased manufacturing speed, and our world-class quality. We added a $2.4 billion 300 satellite order from robotic space networks in February, which we believe is the largest single commercial constellation award ever. This has driven our March quarter end backlog to over $2.5 billion. In addition, we are pleased to announce today that we have signed a new $87 million, 16 satellite order with yet another new customer. This award, combined with several other awards we recently signed, brings our total order books to over 30 programs. More to say on this, but our pipeline to order conversion year to date is a standout highlight. Now, turning to our overall performance and quarterly update. First, I'm happy to announce that our team's positive momentum continues across our space development agency contract. After our successful delivery last year, of our 10 transport layer trans-zero satellites to our partner Lockheed Martin, we are very much looking forward to their launch next month. These trans-zero satellites will demonstrate the low latency communication length to support the warfighter with a resilient network of integrated capabilities from low earth orbit. As a reminder, the SDA transportation layer is a mesh communication network that will use hundreds of low earth orbiting satellites to connect with other solid layers plus critical ground, air, and sea-based systems. As such, the transport layer is foundational to the SDA space architecture for this decade and beyond. We are pleased to contribute this critical national security mission through work on the first two awards for this layer, known as Tronch Zero and Tronch One. Our team is hard at work manufacturing SDA's transport layer Tronch One. The 42 satellite order and we are pleased to confirm that we are on track to begin delivery of the first batch of these satellites during 2023 and the balance by the end of the first quarter of 2024. Tronics 1 will be the first operational generation of the proliferated warfighter space architecture and it's scheduled for deployment by the SBA in late 2024. The Space Development Agency strategy for construction of this advanced space architecture which will consist of hundreds of satellites, has been to rapidly acquire and deploy low-earth orbit satellites and truncheons every two years. The FDA recently issued a solicitation for Trunch 2 satellites, and we expect this award to be announced later this year. We believe our experience and track record with Trunch 0 and Trunch 1, in partnership with Lockheed Martin, differentiate us and position us well for additional awards from the space abomination. Many of you are familiar with our relationship with Lockheed Martin. This seven-plus-year strategic partnership was recently extended through 2035, and we continue leveraging the full spectrum of our combined capabilities to support the Space Development Agency. Tranche 2 of the Transfer Layer, along with the Space Development Layer opportunity, remain key pursuits for our team over the next 12 months. Second, we are very pleased to update you On the company's record $2.4 billion contract, design, manufacture, integrate, and test 300 satellites for Avada's space network. As we announced last month, we have received a further milestone payment, along with completion of the screening of our industrial partners. This mission will consist of satellites orbiting a low-earth orbit and multiple planes using laser communication terminals. Our initial $2.4 billion contract covers only the first 300 satellites. The contract includes an option for Ravada to purchase an additional 300 satellites at an additional cost. The contract is broadly grouped into a design phase and a build phase. We are currently executing on the design phase, which includes a, quote, demonstrator mission that will support the verification of gatewayless transmission from one user to another, routed within a small network of four satellites in space. Mission operations for the on-orbit demonstration satellites will be conducted from TerraMobile's new state-of-the-art satellite operations control center, which is currently under construction in Irvine, California. An additional 25 satellites will be built and commissioned as part of this phase. The build phase will consist of delivering the balance of 300 satellites in late 2025 and the first half of 2026. We are still ramping this program and recently received a milestone payment Revata revenues are projected to steadily ramp up in the coming months. Third, we are thrilled to announce today an $87 million award from a new customer for 16 Low Earth Orbit satellites. We are pleased to be partnering with this new customer who has a long history of advancing space technology. We see ourselves not just as a pioneer, but as an industry leader and a supplier of choice. which is validated by our most recent Constellation Contract Awards. Our backlog and pipeline both remain robust. As of March 31st, our backlog stood at $2.5 billion, representing orders for over 360 satellites, and our pipeline has $11.8 billion. These March 31 metrics include the successful conversion of the Rivada space contract from pipeline to backlog, but exclude today's announced award. In addition to the programs we noted, we have other active programs, many of which are precursors to larger consolation, both for the existing customers and as well as new and other customers who value our deep mission experience and track record. These missions and others we are pursuing are diverse across customer, channel, and mission. Included today is the prototyping and development of satellites, in support of the larger potential constellation. While many of these programs are undisclosed today, they serve the seed as a seed corn for a larger potential constellation awards tomorrow. Our announced Lockheed Martin Linus mission success of two Terran orbital geoseq satellite completing the rendezvous and proximity operations demonstration is just one example of the revolutionary program our team is currently working on. Another is our record-setting NASA Pathfinder technology-demonstrated three satellites, which enable the record 200 gigabits per second space-to-ground optical link. Low latency, secure communication, proliferated systems, speed to orbit, technology innovation, each of these are customer demands for which we are delivering advances today. Supporting all of these orders and opportunities is our vertically integrated and scaled design and manufacturing capability. We are investing in world-class production systems to support execution of our 360 satellites and backlogs and over 2,600 satellites identified in our pipeline. Our new facility, which we call 50 Tech in Irvine, California, has 60,000 square feet of floor space and brings our manufacturing capacity of approximately 20 satellites per month once this facilities fully commissioned later this year. Critically, this includes testing equipment, printed circuit board assembly equipment, and robotic and automated assembly lines to vastly improve throughput, quality, and speed. And we are pleased to announce we are progressing with the development of our recently announced 90,000-square-foot facility also in Irvine, which we expect to increase our capacity to multiples of our current capacity after commissioning in late 2024. Importantly, this new capacity includes 36-foot high bay for assembly and integration of significantly larger satellites. In summary, Terran Orbital has established itself as the leading supplier of the enabling satellite infrastructure of the new space age. Constellations of smaller, low-Earth orbiting satellites are the preferred architecture of the future. What used to cost billions and take a decade to launch, Terran Orbital is building on a fraction of the cost in months. Our investments in scale, vertical integration, and automation leverages our 10-year legacy. Our production system is designed to deliver satellites at a mass scale and at a speed and quantity our customers desire at a price point to stimulate new markets and at margins to reward our shareholders. We are thrilled our strategy was recognized by the two new franchise contract awards in recent months. Now, let me turn it over to Gary. to review our financial performance in the quarter and provide a financial outlook for the full year. Gary?