AST SpaceMobile Provides Fourth Quarter and Full Year 2021 Business Update

Mar 31, 2022
  

MIDLAND, Texas--(BUSINESS WIRE)--Mar. 31, 2022-- AST SpaceMobile, Inc. (“AST SpaceMobile”) (NASDAQ: ASTS), the company building the first and only space-based cellular broadband network accessible directly by standard mobile phones, today is providing its business update for the fourth quarter and fiscal year ended December 31, 2021.

“Since our last quarterly business update, our global team has worked diligently to substantially complete the assembly of, and critical testing milestones related to our next satellite, BlueWalker 3. The satellite is on schedule for our planned summer launch and all testing and integration are near completion,” said Abel Avellan, Chairman and CEO of AST SpaceMobile.

Mr. Avellan added, “In our first year as a public company, we have achieved important technical milestones to position ourselves for the planned launch of BlueWalker 3, which will bring to a close our initial development phase. In parallel, we’ve advanced our production spacecraft design and procurement, made facility and human capital investments to support high-volume manufacturing capabilities, and furthered our relationships with mobile network operators around the globe.”

Business Highlights Through March 31, 2022

  • Substantially completed the assembly of, and critical testing milestones for BlueWalker 3 in advance of its planned summer launch
  • Completed the purchase of a 100,000 square feet extension facility in Texas, to support our commercial satellite manufacturing capabilities
  • Completed the first phase of renovations on the extension facility and earmarked approximately $20.0 million of additional investment
  • Established new technology hub in Maryland to support Systems Engineering, Network Operations Center (“NOC”) and Satellite Operations Center (“SOC”)
  • Increased to more than 1.8 billion the number of subscribers represented by mobile network operators who have agreements and memoranda of understanding with AST SpaceMobile as of March 31, 2022, compared to 1.5 billion at November 15, 2021
  • Signed a non-binding memorandum of understanding with Orange S.A., one of the world's leading telecommunications operators serving more than 220 million mobile customers across the globe
  • Growth of 30 employees across all offices in the fourth quarter of 2021, with a team of 566 as of December 31, 2021, including 386 full-time employees and consultants and 180 employees of 3rd party engineering service providers working on AST SpaceMobile
  • Grew portfolio of patent- and patent-pending claims to more than 2,100 worldwide as of March 31, 2022
  • Signed a multi-launch agreement, covering the planned summer launch of BW3 and the launch of the first BlueBird satellite, and providing a framework for future launches, and paid $22.75 million in the first quarter of 2022 in connection therewith

Fourth Quarter and Full Year 2021 Financial Highlights

  • Ended the fourth quarter with cash, cash equivalents, and restricted cash of $324.5 million and $5.0 million of debt as of December 31, 2021, incurred in connection with the purchase of the new Texas facility
  • Total operating expenses increased by $64.3 million to $91.6 million for the year ended December 31, 2021, as compared to $27.3 million for the year ended December 31, 2020. Operating expenses for the fiscal year ended December 31, 2020 and for the period from January 1, 2021 up to April 6, 2021, the date of the Business Combination, are of the accounting predecessor, AST LLC. After the Business Combination, upon obtaining additional funding of $416.9 million, the Company significantly expanded its operations and research and development initiatives, made significant progress on the BW3 test satellite and design of the BB satellites, and increased the headcount of employees and consultants, which contributed to a significant increase in operating expenses during 2021
  • Total operating expenses increased by $8.2 million to $31.3 million for the fourth quarter of 2021, as compared to $23.1 million in the third quarter of 2021, due to a $3.0 million increase in research and development costs, $2.9 million increase in engineering services, and $2.3 million increase in general and administrative expenses
  • Through December 31, 2021 and as of March 31, 2022, invested $67.6 million and $80.7 million, respectively, in the construction of BlueWalker 3 satellite. The BlueWalker 3 satellite is substantially complete, and we do not expect to incur material costs in future periods related to the BlueWalker 3 satellite
  • As of December 31, 2021, invested $31.9 million in property and equipment primarily related to the Texas facilities, satellite antennas, test equipment, and leasehold improvements

Conference Call Information

AST SpaceMobile will hold a quarterly business update conference call at 5:00 p.m. (Eastern Time) today, March 31, 2022. The call will be accessible via a live webcast on the Events page of AST SpaceMobile’s Investor Relations website at https://investors.ast-science.com/. An archive of the webcast will be available shortly after the call.

About AST SpaceMobile

AST SpaceMobile is building the first and only global cellular broadband network in space to operate directly with standard, unmodified mobile devices based on our extensive IP and patent portfolio. Our engineers and space scientists are on a mission to eliminate the connectivity gaps faced by today's five billion mobile subscribers and finally bring broadband to the billions who remain unconnected. For more information, follow AST SpaceMobile on FacebookTwitterLinkedIn and YouTube. Watch this video for an overview of the SpaceMobile mission.

To receive alerts about upcoming events and press releases, please sign up for our investor relations email alerts list at https://investors.ast-science.com/ir-resources/email-alerts.

Forward-Looking Statements

This communication contains “forward-looking statements” that are not historical facts, and involve risks and uncertainties that could cause actual results of AST SpaceMobile to differ materially from those expected and projected. These forward-looking statements can be identified by the use of forward-looking terminology, including the words “believes,” “estimates,” “anticipates,” “expects,” “intends,” “plans,” “may,” “will,” “would,” “potential,” “projects,” “predicts,” “continue,” or “should,” or, in each case, their negative or other variations or comparable terminology.

These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from the expected results. Most of these factors are outside AST SpaceMobile’s control and are difficult to predict. Factors that may cause such differences include, but are not limited to: (i) expectations regarding AST SpaceMobile’s strategies and future financial performance, including AST’s future business plans or objectives, expected functionality of the SpaceMobile Service, anticipated timing and level of deployment of satellites, anticipated demand and acceptance of mobile satellite services, prospective performance and commercial opportunities and competitors, the timing of obtaining regulatory approvals, ability to finance its research and development activities, commercial partnership acquisition and retention, products and services, pricing, marketing plans, operating expenses, market trends, revenues, liquidity, cash flows and uses of cash, capital expenditures, and AST’s ability to invest in growth initiatives; (ii) the negotiation of definitive agreements with mobile network operators relating to the SpaceMobile service that would supersede memoranda of understanding and preliminary agreements; (iii) the ability of AST SpaceMobile to grow and manage growth profitably and retain its key employees and AST SpaceMobile’s responses to actions of its competitors and its ability to effectively compete; (iv) changes in applicable laws or regulations; (v) the possibility that AST SpaceMobile may be adversely affected by other economic, business, and/or competitive factors; (vi) the outcome of any legal proceedings that may be instituted against AST SpaceMobile; and (vii) other risks and uncertainties indicated in the Company’s filings with the SEC, including those in the Risk Factors section of AST SpaceMobile’s Form S-1 Registration Statement filed with the SEC on June 25, 2021 (File No. 333-257425) as well as the Risk Factors contained in Part II, Item 1A of AST SpaceMobile’s Form 10-Q dated August 16, 2021, as well as the Risk Factors to be included in AST SpaceMobile’s Annual Report on Form 10-K, to be filed with the SEC on March 31, 2022.

AST SpaceMobile cautions that the foregoing list of factors is not exclusive. AST SpaceMobile cautions readers not to place undue reliance upon any forward-looking statements, which speak only as of the date made. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the Risk Factors incorporated by reference into AST SpaceMobile’s Form S-1 Registration Statement filed with the SEC on June 25, 2021 (File No. 333-257425) as well as the Risk Factors contained in Part II, Item 1A of AST SpaceMobile’s Form 10-Q dated August 16, 2021, as well as the Risk Factors to be included in AST SpaceMobile’s Annual Report on Form 10-K, to be filed with the SEC on March 31, 2022. AST SpaceMobile’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.gov. Except as expressly required by applicable securities law, AST SpaceMobile disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

Fourth Quarter and Fiscal Year 2021 Financial Results

 

AST SPACEMOBILE, INC.

CONSOLIDATED BALANCE SHEETS

(dollars in thousands, except share data)

 

 

 

December 31,

 

 

 

2021

 

 

2020

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

321,787

 

 

$

42,777

 

Restricted cash

 

 

2,750

 

 

 

-

 

Accounts receivable

 

 

2,173

 

 

 

2,081

 

Inventories

 

 

1,412

 

 

 

2,591

 

Prepaid expenses

 

 

3,214

 

 

 

1,249

 

Other current assets

 

 

4,467

 

 

 

2,234

 

Total current assets

 

 

335,803

 

 

 

50,932

 

 

 

 

 

 

 

 

Property and equipment:

 

 

 

 

 

 

BlueWalker 3 satellite - construction in progress

 

 

67,615

 

 

 

27,013

 

Property and equipment, net

 

 

28,327

 

 

 

10,057

 

Total property and equipment, net

 

 

95,942

 

 

 

37,070

 

 

 

 

 

 

 

 

Other non-current assets:

 

 

 

 

 

 

Operating lease right-of-use assets, net

 

 

7,991

 

 

 

7,045

 

Intangible assets, net

 

 

242

 

 

 

526

 

Goodwill

 

 

3,641

 

 

 

3,912

 

Other non-current assets

 

 

317

 

 

 

160

 

Total other non-current assets

 

 

12,191

 

 

 

11,643

 

 

 

 

 

 

 

 

TOTAL ASSETS

 

$

443,936

 

 

$

99,645

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

6,638

 

 

$

4,990

 

Accrued expenses and other current liabilities

 

 

7,469

 

 

 

4,222

 

Deferred revenue

 

 

6,636

 

 

 

3,401

 

Current operating lease liabilities

 

 

634

 

 

 

504

 

Total current liabilities

 

 

21,377

 

 

 

13,117

 

 

 

 

 

 

 

 

Warrant liabilities

 

 

58,062

 

 

 

-

 

Non-current operating lease liabilities

 

 

7,525

 

 

 

6,541

 

Long-term debt

 

 

5,000

 

 

 

-

 

Total liabilities

 

 

91,964

 

 

 

19,658

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders' Equity:

 

 

 

 

 

 

Class A Common Stock, $.0001 par value, 800,000,000 shares authorized, 51,730,904 shares issued and outstanding as of December 31, 2021

 

 

5

 

 

 

-

 

Class B Common Stock, $.0001 par value, 200,000,000 shares authorized, 51,636,922 shares issued and outstanding as of December 31, 2021

 

 

5

 

 

 

-

 

Class C Common Stock, $.0001 par value, 125,000,000 shares authorized, 78,163,078 shares issued and outstanding as of December 31, 2021

 

 

8

 

 

 

-

 

Additional paid-in capital

 

 

171,155

 

 

 

-

 

Common equity (pre-combination)

 

 

-

 

 

 

117,573

 

Accumulated other comprehensive loss

 

 

(433

)

 

 

(168

)

Accumulated deficit

 

 

(70,461

)

 

 

(39,908

)

Noncontrolling interest

 

 

251,693

 

 

 

2,490

 

Total stockholders' equity

 

 

351,972

 

 

 

79,987

 

 

 

 

 

 

 

 

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

 

$

443,936

 

 

$

99,645

 

 
 
 

AST SPACEMOBILE, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(dollars in thousands, except share and per share data)

 

 

 

Year Ended December 31,

 

 

 

2021

 

 

2020

 

 

 

 

 

 

 

 

Revenues

 

$

12,405

 

 

$

5,967

 

 

 

 

 

 

 

 

Cost of sales (exclusive of items shown separately below)

 

 

7,563

 

 

 

3,025

 

 

 

 

 

 

 

 

Gross profit

 

 

4,842

 

 

 

2,942

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

Engineering services

 

 

29,599

 

 

 

13,081

 

General and administrative costs

 

 

35,636

 

 

 

12,320

 

Research and development costs

 

 

23,440

 

 

 

1,011

 

Depreciation and amortization

 

 

2,913

 

 

 

887

 

Total operating expenses

 

 

91,588

 

 

 

27,299

 

 

 

 

 

 

 

 

Other income:

 

 

 

 

 

 

Gain on remeasurement of warrant liabilities

 

 

15,766

 

 

 

-

 

Other income (expense), net

 

 

(1,950

)

 

 

83

 

Total other income, net

 

 

13,816

 

 

 

83

 

 

 

 

 

 

 

 

Loss before income tax expense

 

 

(72,930

)

 

 

(24,274

)

Income tax expense

 

 

331

 

 

 

131

 

Net loss before allocation to noncontrolling interest

 

 

(73,261

)

 

 

(24,405

)

 

 

 

 

 

 

 

Net loss attributable to noncontrolling interest

 

 

(42,708

)

 

 

(344

)

Net loss attributable to common stockholders

 

$

(30,553

)

 

$

(24,061

)

Net loss per share of common stock attributable to common stockholders (1)

 

 

 

 

 

 

Basic and diluted

 

$

(0.37

)

 

N/A

 

Weighted average shares used in computing net loss per share of common stock (1)

 

 

 

 

 

 

Basic and diluted

 

 

51,729,785

 

 

N/A

 

 

(1) Earnings per share information has not been presented for periods prior to the Business Combination, as it resulted in values that would not be meaningful to the readers of these consolidated financial statements. Refer to Note 16 in the Notes to the Consolidated Financial Statements included in our Form 10-K for the year ended December 31, 2021 for further information.

 
 

AST SPACEMOBILE, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(dollars in thousands)

 
 

 

 

Year Ended December 31,

 

 

 

2021

 

 

2020

 

 

 

 

 

 

 

 

Net income (loss) before allocation to noncontrolling interest

 

$

(73,261

)

 

$

(24,405

)

Other comprehensive income (loss)

 

 

 

 

 

 

Foreign currency translation adjustments

 

 

(666

)

 

 

382

 

Total other comprehensive income (loss)

 

 

(666

)

 

 

382

 

Total comprehensive income (loss) before allocation to noncontrolling interest

 

 

(73,927

)

 

 

(24,023

)

Comprehensive income (loss) attributable to noncontrolling interest

 

 

(43,109

)

 

 

(123

)

Comprehensive income (loss) attributable to common stockholders

 

$

(30,818

)

 

$

(23,900

)

 
AST SPACEMOBILE, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(dollars in thousands, except per share data)
 
Three Months Ended December 31,

 

2021

 

 

 

2020

 

 
Revenues

$

6,220

 

$

2,702

 

 
Cost of sales (exclusive of items shown separately below)

 

3,441

 

 

391

 

 
Gross profit

 

2,779

 

 

2,311

 

 
Operating expenses:
Engineering services

 

10,842

 

 

4,655

 

General and administrative costs

 

11,605

 

 

4,682

 

Research and development costs

 

7,949

 

 

951

 

Depreciation and amortization

 

864

 

 

470

 

Total operating expenses

 

31,260

 

 

10,758

 

 
Other income:
Gain on remeasurement of warrant liabilities

 

18,042

 

 

-

 

Other income (expense), net

 

(2,106

)

 

25

 

Total other income, net

 

15,936

 

 

25

 

 
Loss before income tax expense

 

(12,545

)

 

(8,422

)

Income tax expense

 

258

 

 

131

 

Net loss before allocation to noncontrolling interest

 

(12,803

)

 

(8,553

)

 
Net loss attributable to noncontrolling interest

 

(9,693

)

 

(17

)

Net loss attributable to common stockholders

$

(3,110

)

$

(8,536

)

Net loss per share of common stock attributable to common stockholders (1)
Basic and diluted

 

(0.06

)

 

N/A

 

Weighted average shares used in computing net loss per share of common stock (1)
Basic and diluted

 

51,729,943

 

 

N/A

 

 
 
(1) Earnings per share information has not been presented for periods prior to the Business Combination, as it resulted in values that would not be meaningful to the users of these unaudited condensed consolidated financial statements.
 
AST SPACEMOBILE, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED)
(dollars in thousands)
 
Three Months Ended December 31,

 

2021

 

 

2020

 

 
Net income (loss) before allocation to noncontrolling interest

$

(12,803

)

$

(8,553

)

Other comprehensive income (loss)
Foreign currency translation adjustments

 

(172

)

 

128

 

Total other comprehensive income (loss)

 

(172

)

 

128

 

Total comprehensive income (loss) before allocation to noncontrolling interest

 

(12,975

)

 

(8,425

)

Comprehensive income (loss) attributable to noncontrolling interest

 

(9,826

)

 

94

 

Comprehensive income (loss) attributable to common stockholders

$

(3,149

)

$

(8,519

)

 

 

AST SPACEMOBILE, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(dollars in thousands)

 

 

Years Ended December 31,

 

 

2021

 

 

2020

 

 

 

 

 

 

 

Cash flows from operating activities:

 

 

 

 

 

Net loss before allocation to noncontrolling interest

$

(73,261

)

 

$

(24,405

)

Adjustments to reconcile net loss before noncontrolling interest to cash
used in operating activities:

 

 

 

 

 

Depreciation

 

2,689

 

 

 

670

 

Amortization of intangible assets

 

224

 

 

 

217

 

(Gain) loss on remeasurement of warrant liabilities

 

(15,766

)

 

 

-

 

Non-cash lease expense

 

574

 

 

 

219

 

Stock-based compensation

 

3,736

 

 

 

283

 

Changes in operating assets and liabilities:

 

 

 

 

 

Accounts receivable

 

(220

)

 

 

(1,568

)

Prepaid expenses and other current assets

 

(4,216

)

 

 

(1,485

)

Inventory

 

1,039

 

 

 

(2,236

)

Accounts payable and accrued expenses

 

2,091

 

 

 

3,476

 

Operating lease liabilities

 

(398

)

 

 

(219

)

Deferred revenue

 

3,572

 

 

 

2,235

 

Other assets and liabilities

 

(159

)

 

 

6

 

Net cash used in operating activities

 

(80,095

)

 

 

(22,807

)

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

Purchase of property and equipment

 

(15,080

)

 

 

(8,123

)

Purchase of intangible asset

 

-

 

 

 

(23

)

BlueWalker 3 satellite - construction in process

 

(39,712

)

 

 

(22,258

)

Net cash used in investing activities

 

(54,792

)

 

 

(30,404

)

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

Proceeds from Business Combination

 

456,420

 

 

 

-

 

Direct costs incurred for the Business Combination

 

(39,542

)

 

 

(775

)

Proceeds from warrant exercises

 

14

 

 

 

-

 

Repayment for founder bridge loan

 

-

 

 

 

(1,750

)

Proceeds from issuance of Series B Preferred Stock

 

-

 

 

 

79,833

 

Issuance costs from issuance of Series B Preferred Stock

 

-

 

 

 

(7,745

)

Proceeds from promissory note with common shareholder

 

-

 

 

 

100

 

Proceeds from debt

 

49

 

 

 

-

 

Net cash provided by financing activities

 

416,941

 

 

 

69,663

 

 

 

 

 

 

 

Effect of exchange rate changes on cash, cash equivalents and restricted cash

 

(294

)

 

 

(173

)

 

 

 

 

 

 

Net increase in cash, cash equivalents and restricted cash

 

281,760

 

 

 

16,279

 

Cash, cash equivalents and restricted cash, beginning of period

 

42,777

 

 

 

26,498

 

Cash, cash equivalents and restricted cash, end of period

$

324,537

 

 

$

42,777

 

 

 

 

 

 

 

Supplemental disclosure of cash flow information:

 

 

 

 

 

Non-cash transactions:

 

 

 

 

 

Purchases of construction in process in accounts payable

$

3,265

 

 

$

2,615

 

Purchases of property and equipment in accounts payable

 

1,429

 

 

 

794

 

Right-of-use assets obtained in exchange for operating lease liabilities as of January 1, 2020 upon adoption of ASC 842

 

-

 

 

 

6,472

 

Right-of-use assets obtained in exchange for operating lease liabilities

 

1,557

 

 

 

734

 

Purchases of property and equipment using proceeds from long-term debt

 

5,000

 

 

 

-

 

Cash paid during the fiscal year for:

 

 

 

 

 

Interest

$

13

 

 

$

25

 

Income taxes, net

 

186

 

 

 

134

 

 

AST SpaceMobile
Investors:
Scott Wisniewski
investors@ast-science.com

Media:
Brandyn Bissinger
press@ast-science.com
+1 866 845 6521

Source: AST SpaceMobile, Inc.