Docoh
Loading...

SPCE Virgin Galactic

Participants
Michelle Kley Executive Vice President, General Counsel and Secretary
George Whitesides Chief Executive Officer
Jon Campagna Chief Financial Officer
Enrico Palermo Chief Operating Officer
Adam Jonas Morgan Stanley
Robert Spingarn Credit Suisse
Darryl Genovesi Vertical Research Partners
Call transcript
Due to licensing restrictions, you must log in to view earnings call transcripts.
Operator

Good afternoon. My name is Jason and I will be your conference operator today. At this time, I would like to welcome everyone to Virgin Galactic Fourth Quarter and Full-Year 2019 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. Instructions] [Operator

call Secretary Kley, at conference General Vice be and Counsel Virgin will today's Executive Michelle President, Hosting Galactic.

As being a recorded. is reminder, today's call

Ms. like conference I turn Kley. to now ahead. Please would go to over the

Michelle Kley

with will George and Campagna, and of is XXXX are Chief quarter George provide Jon Financial you, Galactic's Enrico me Executive with Chief call. full-year Palermo, be good prepared available to Officer Officer, earnings Welcome Thank Operating Virgin everyone. Officer; the fourth Whitesides, will With conference questions today along afternoon, who answer me and who and portion to during remarks. Chief Q&A Also the call. Jon

we the available our full-year overview today, a of a Investor fourth made XXXX. and provides and slide on highlights financial quarter an Earlier business presentation and for press Relations issued release our website, which

certain today’s statements forward-looking within will the we During of securities call, laws. make federal meaning

and are a expectations about could Forward-looking statements future the events predictions, are cause are actual subject that this result, assumptions projections and uncertainties. to in materially risks communication. future events Many statements forward-looking from differ and current factors other and, on to based statements as

on Exchange Commission. about Securities the statements, XX-K release as the Company's subsequent to actual may addition that differ from Form with that the Risk earnings with materially as well filings we in Securities file and and the forward-looking For cause Report we of to information please more Annual the Exchange factors to today will refer results press Commission issued the section Factors

to made. put are date statements. not only undue cautioned Forward-looking as forward-looking statements speak the are they of reliance on Readers

the turn Whitesides. to George that, like With over I'd call to

George Whitesides

our be to first I with these a space Both make you, transaction listed am call everyone. completed York Social that everyone now delighted and afternoon, New the Exchange. to continue open steps as Thank we Stock we Hedosophia towards goal. reaching for Capital are our hosting have that and Good and major our mission to events public of great are company, earnings progress on Michelle. forward

an will the what I strategy will have and quarter to I highlights. our Jon providing so by would like then achieved on through to also you financial of and provide start fourth growth turn far areas we forward. our our activity current our of then detail to going overview take drive business, focus.

one exciting investment believe Spaceflight. company X. Galactic public Human our our with and is world's broaden Commercial exploration focused space and thesis our Starting affordable the the technology on We consistent Slide first initiatives enable and to significant most access and and of on the is space represents of commercial routine travel. Virgin of to only mission time,

exists experience segment fraction opportunity significant high-end demand unique the which other experiences, incurred market a particularly broader to by individuals by private growth out-of-home worth XXXX. with expense provide at for launch for individuals luxury a outpaced high Significant spaceflight X% There horizontal net the to-date. of is already experiences,

our we Our customer offering have highly sustained our seen interest founding. base since in is and engaged product

representing deposits, in X,XXX $XXX February XX, of to doubling last since revenue. a as of continue than and million XXXX. $XX Registrations in over our pace interest approximately at and at XXXX, stand of reservations XXX rapid over currently million have more We potential update grow

reduce each of our underpinned business and meaningfully scalable by the our cost operational economics. unit spaceflight the strong efficient, highly of is features spaceships. The attractive time, delivering over design believe We reusable, model design

$X with in investment more the Importantly, we Company. commercial billion than the a industry strong have spaceflight competitive of behind position

substantial competitors entry investment technology progress achieved have by We significant in and the supported for potential made expect from first-mover have benefit the by to is greatly to-date. which we our our we to reinforced new advantage, barriers

confident in are we addition, In financial our business. the of strength

Step One future flyer initiative, are the very our of X,XXX to today interest our through start spaceflight, announcement Small to up from validate we marks important seeing register important will list. which we signing exciting our our fly about sales Small The We've to huge people people later Step talk will is engine. December One the an interest to which reactivate program since milestone see. seen approximately to I

have What One line the those bring provide Small Step to first in to once while us people is prospects to enabling means a a new ticket new prospects into community, be will and seats we available. qualify purchase Galactic

when the commercial time, more our online, and see and benefit we increase and our past efficiencies will build our to in through momentum. revenue rate to our launch spaceships drive cash we is flight move we expect profitability. ramp from bringing to up As expect Over gain XXXX operating business really flows.

in today transaction a cash on are into Jon the as and no a strong later. result will We Capital Social Hedosophia on the we position our financials detail sheet. go with of debt balance more have

the flight in experience and sectors. team with place and operations Finally, decades have strong we in management Space Aviation a of

far. share Let over we and XX key our the months some pace me now progress past thus demonstrate have that milestones achieved

XX, Shuttle. since Space Turning vehicle into was a This humans the was of we On space first space. crewed step the historic December launched from U.S. XXXX, put to XXXX, successfully to the Slide X. the launch and soil space first retirement commercial

subsequently Secretary awarded January. Transportation Our wings the by their of official U.S. flew this were who pilots in flight astronaut

crew becoming We crew Moses, a completed in and than the non-pilot first space float vehicle. and February commercial Instructor follow spaceflight first to Turning X. in freely on flown vehicle space at this Astronaut commercial faster X commercial fly member up fly on unstrap a a to successful space our Mach by vehicle, XX, XXXX. space having her the Slide member on Chief Beth first non-pilot

flight time the and the Administrator transportation were for FAAs also wings runs pilots this their Wayne official two Beth this space Associate division. awarded Monteith, who astronaut by

world's home terminal Virgin for America Gateway we purpose-built On X. we operational our Mexico. offers XX, the use. first to America Slide The advantages. spaceport the New initiated have to Space is our and Spaceport which headquarters to XXXX, Southern Galactic move operational Turning May exclusive at spaceport commercial in Spaceport unparalleled to

White restricted natural we Most importantly, Missile It for it meaning will during is air missions, great Sands Range, the commercial surroundings. not enabling operations our also tempo. year-round and operational within that offers beautiful surrounding of ultimate traffic disturb weather airspace higher a the

We in Company announcement employees of made manufacturing a of at the the this was relocation and New Capitol it State Lujan California. Mexico Grisham the Governor, meant our dozens moment from base Mojave, it for with significant as

On Spaceport operationally America which we functional. called aircraft our VMS Turning New XX, to to Slide X. at point became relocated August XXXX, Mexico, carrier Eve

a systems and processes. of and our additional and wide range tracking activated we Specifically, mission our control, telemetry systems

from October to had HorizonX that partnership and X. XXXX, strategic announced On in X, Turning with million Boeing we we strategic a investment Slide entered $XX Ventures. Boeing’s received into

We this to in responsible a safe potential partnership space about and mission and are our to open support and excited world access way. the its to

developing provide our supports ramps and global projects I'll also provide a on information as efforts on on focus in detail this It our high-speed we technology. presentation more up. bit partnership high-speed Boeing specific will mobility later our with

safe, deployed to suits unveiled footwear Under enjoyment entire On will our future in will and astronauts Turning astronauts collaboration to our provide with Armour XX. be October and the XXXX, increase and Under we of technologies our wear their that that flight future their with Armour flight flight. XX, the experience. comfortable, announced garment flexible, suits latest Slide

and October focused phone our prior all exciting we creating XX, day with world's us the only XX. company transformational for was listing. publicly the from our Slide of XXXX, to Turning completed on and hugely Social On commercial spaceflight. merger first support the and we public many This Hedosophia, you since and Capital to traded on a appreciate

team. Turning a XX. world-class believe traded a Social with each Board's Board merger experience on we our brings We've listed our Slide and to out installed experience and Slide Hedosophia In our and complimentary of completing Directors. today's to becoming company, XX of directors connection with expertise presentation. significant publicly of Capital We our

collection space see high-speed will will and well mission company aerospace leaders leading as some the shareholders leading top its the from forward towards commercial operations world. we while airlines This thoughtful of as in the of You the mobility. experience firms of organization looking serve assurance investment well establish world the the world's and as

XX. well their flight some off our training as preparing space their Headquarters we Astronaut process of medicals, as Baltimore, enabled for the in continue of and future Slide to for flights. be activities. undertaking kicked preparation Armour to This Readiness process our customers including fitted the flights paperwork of their astronaut XXXX, their number earliest customers for flight advice a Turning Program, on November wellness health do to receive XX, suits, Global at On the Under

Weight achieved carried our elements its weight vehicle and in announced to first on the completed major XX. and a deployed all major January XXXX, where main assembled spaceship Slide its milestone Turning of the we the build gear and for time. landing that On fleet had vehicle Wheels the were own structural X, second

Weight to approximately us first the Weight months and experience processes achieved our in reach faster through Wheels and the benefits. of build spaceship, process use allowing build of more Wheels as well than nine modular We efficiencies terms incompleteness both as of our efficiently then on ship, first on milestone the faster curve largely

captive ago, California opportunity Turning Unity engineers our XXXX, three first carry America over valuable period high in significant at during am cold February milestone to our to hours space. evaluate longer a us and Mojave, of was altitude for XX, for a on provided A Spaceport and proud Slide I of This relocated few This from Mexico. missions a and VSS VSS spaceship weeks time for to XX. we to flight Unity experienced is temperatures, really team. accomplishment New

XX. Slide to Turning

approval to Now missions. launch like license, spaceflight on commercial I allows FAA have provide which detail Virgin some We process. Galactic our to already would conduct the

We our rocket-powered under license. have this of flights already all conducted

license. FAA that and going are process through final doing our data we paying now What providing elements of the to with validates is customers the commercial by fly verifies

elements, We XX XX of validation in out have the cleared of verification XX QX and which of were completed XXXX. already

the provide and We appropriate. hard remaining updates will as we are elements V&V on working

XX. Turning to Slide

to its It year, stakeholders. will top a Branson it to We spaceflight beginning and moment be will into world on the a and the commercial continue and focus fly space for be to customers powerful that commercial our transformative is which of company Richard flight. phase priority human a employees, the signal of on the next is

from experience with goal, of and execution, milestone reached facilities, and Unity next sets now have it interfaces we is the our aspects ground up in to New hosting Spaceship of hospitality. staff of services, external flights test that various building operations, coordination, Mexico. all permanent support, This pleased airspace significant the mission to that Spaceport conduct base and familiarity milestone achieving America relocation in us the are We because our new

to work accomplish And While we that have spaceflight is progress tremendous our by come important that can operations far safely and we occur. before forget excited important not and most the our have are will successfully. still conduct to-date, we objective to significant

of will these in long-term the optimizing customer the and I have areas to flight vehicles each test rate service. finishing testing of work That program, experience, main focus: discuss like for the readying would three end-to-end turn. high

flight the finishing First, test program.

complete valuable additional piloting experience will For we area, program, of this maybe design. our the out us operating that check aspects to and our enable gather which data glide gain our to performance new incorporated flight into need location,

our we that the customers, astronauts We the prepare well evaluate of program, evaluation system. experience validate performance will further flight flight that This its of used spaceflight enable journey. will optimizing will phase to to throughout be our also range entire program as to be will then spaceflight powered as spaceships us and for which the our spacecraft complete future our the profile the continue their training will the providing interior to onboard

repeatability. in flight flight work the and flight performance performed gather and data, additional for on flight the to program, additional profile improve each With perform evaluate vehicle test we performance, the

get beyond Next, during their America of goes Spaceport just their prepared experience during their earlier a well their cabin as the as training journey take spaceship will at as flight, receive our testing customers the end-to-end to in customer the time both experience. includes they the the flight. spaceflight. It in This to prior

the people on the at the ground, It flying to customers to in and extends family issuance invited the friends hospitality and to throughout includes will at stay. entire back training receive cover This of as preparation preliminary tickets. the hotel not but their It experience, also is the further to and space, just their time the and extends experience Spaceport, pre-arrival limited well.

vehicles high This key Third, will readying for work the points. have focal several long-term service. rate

and for First, the and aircraft flight. readied ensuring spaceship that be for resiliency prepared carrier have systems proper ability the in quickly and their the inspected well to and are their structures next

conditions flight qualities a ensuring of the of well variety future flight performance to expansion. geographic to handling suited Second, a we controls, look that vehicles as and are

make in due service. note, that to performance, carrier mind Third, and or keep flight our back and possible of continuing its that is before capabilities, and it everyone spaceship the commercial regular the the and enhancements safety, comprehensive two Mojave lifetime should in remains spaceship to upgrades manufacturing base to extensive aircraft enhance we and start to times Mojave that rate. bring one One

We intend as Richard and Branson updates significant necessary the to provide space milestones achieve fly periodic we commence into commercialization. to

perspective like and some year, and company from a operations this focus for revenue the service. get have to vehicles our working for commercial regular the While this initial we would engineering prepared main commercial year long-term is to

operate bit we in. context provide to want I market the about XX. Slide to a Turning more

the several with Over to improved commercial decade, space market. significant the availability the advancing rapidly open decreasing greater driven commercial invigorate innovation growth models past technology access in industry, of capital to space have technologies, costs, converged have and trends

at According $X.X domestic of to market an year the X% October, XXXX to is to X% trillion per least gross grow reaching space commercial Chamber product. by U.S. U.S. expected Commerce, XXXX, of the article the from

current expect forefront we these broad traveling believe and administration's be them dreams the sector at the spaceflight to human We space. boosted population are We well to by on the Space U.S. of launch a the global of by positioned of to further Force. capitalize to that bringing are recent trends

is to only been historically a group to select been XX. risk. Slide and funded governments, can much of national generally great to space. are two who Historically, charging and option months commercial providers access offering to training. millions by affordable orders limited has orbital private for of magnitude Private able significantly we of with travel are allow space What individuals of more space personal space requiring tens travel only at of to many greater and portion of to the expense reach has Turning by individuals humanity a dollars

a out-of-home broader has growth indicates X% offering approximately and research luxury of experience. and in view the to our as expected outpaced of XXXX market goods the segment trend The segment We luxury continue. our by experienced this is this

The and $XX spaceflight we have X,XXX for is have our in demand also by product approximately more the approximately of by than XXX first of reservations XXXX. in we registrations our since received million supported reservations interest and December, deposits received

see to of with expect launch Small announced shortly. this about today We talk One our in grow more initiative the Step that I will detail

Turning XX. to Slide

detail Research more individuals of with bit our individuals $XX key compound rate worth a than a worth greater were is right annual a of in net into million. demographic approximately approximately X.X growth XXXX. grow net million high Going through at that on shows expected now. there globally group This to X% XXXX,

below as a that believe figure. this only is this to so of business expect this contemplates we percentage group be group, small actually headwinds. well that to any worth we than customers We know protected against macroeconomic very our target have greater very current many our be a serve model that we net of our market Further,

currently Slide final to Turning commercial We one phase have entering test spaceship XX. before launch. its

XXXX, have end which flight rate. to As on We second to plan earlier, on reached major us to touched significantly the should fleet spaceship service the of milestone I increase in expand by Wheels spaceships month. last five our allow a our Weight

contract of during are to tended actively Force we the into In will with XXXX trips. conduct which the fourth we with addition the a for Italian space. human research is working to experiments are Italian human of in education researchers Air space this good research in quarter flight and A example entered research while travel, also conduct they payload customers new

and and Multiple experiments. research government expressed develop research space agencies to payloads with institutions working conduct to us have interest suborbital in to

We in the have an missions to we manifest important for and expect research-related flown launch missions our eight future. payloads research of part form

expand total by technology to allowing looking to and than operations capacity costs, efficiencies worth will to drive XX lower Slide to be meet are that to market to We we the to currently able modeling addressable ticket prices, leveraging we prices. lower greatly with net reduce a Turning our our individuals believe us and ahead. ticket and have our

working per to existing effort also good our are cost in in the spaceship to and efficiencies drive hard are an We manufacturing already making capabilities decrease we progress.

well For the use experience the example, Weight faster modular approximately our first as largely ship, build than spaceship reached benefits. on processes milestone our through second Wheels curve nine months as of

Finally, we international arrangements by other agencies. or into potentially spaceports different are opening abroad, growth additional with entering pursuing government opportunities including

United in already countries. had and also other with discussions with the are Emirates conversations have Italy Arab preliminary We and

Turning XX. Slide to

our focus global While and platform most advanced spaceflight, additional can manufacturing on engineering believe design, robust past human and primary leverage high-speed data experience notably extensive future mobility. develop we commercializing our and significant flight we applications, is on centered technologies, that of to aerospace

We global High-speed travel government commercial to and is apply global for opportunities key in other example global applications, nine the new focus high-speed already flight the particularly drastically such see markets, technology flight to we market time, dramatic huge missile mobility on a space. a aviation military to reduce shows reduce Even impact the vehicle more L.A. as have the enabling connecting Tokyo activities the here could could that have time hypersonic world supersonic and by a hours. how closely. to mobility

is today potential already we to XX. positioned are to Galactic ahead Turning believe peers. significantly technology of we this our develop Slide well Virgin and

today crewed gives can immense building speeds, believe is advantage. supersonic an us travel only team commercial designing, and which first-mover at we Ours the flying that a vehicle

enable high-speed will develop believe We are to Boeing, our further partnership with our technology. us bolstered which we by further

manufacturing co-located from vertically stack. also integrated Our team design and our benefits

landing our launch that patterns system airport of means the with we existing and system, existing infrastructures air a airport networks. around a are with sequenced capable and addition, winged compatible world the flight horizontal architecture into being In local

We developing team global and experienced team applying high-speed looking out we further. have a are dedicated to and technology project focused to build and mobility this

insight respect, Virgin our are experience we Virgin leverage experience pleased Finally, on other this we Group’s CEO, can of Board Directors. Krieger have from the former airlines. In Craig Atlantic and to the of

fleet to vehicles reach adoption high-speed accelerated for accessing infrastructure ahead, premium our global be aerospace rapid vehicles environmentally value customer-driven, into precious vision airport is looking existing commercially operators would of We believe fleet time. sustainable and opportunities. with viable who create So a end-to-end new with integrate service a resource, winged, a market of and saving would for easily have significant

a for that analysis guidance we navigation, and foundation to can focused tools, propulsion, As and aero-derivative technologies are work, applications and supporting technologies creating developed material manufacturing, benefit direct sustainable this other on all. with high-speed fuels, provide for IP science,

Turning XX. to Slide

initiative Mojave Our integrated part Virgin by high-speed testing, the spaceship in enabled post-delivery in & and Spaceship aerospace flight the within companies extensive capabilities range Air Space headquartered Company, is of testing, support. our Galactic, ground vertically manufacturing, at the design, covered California. The Port manufacturer end-to-end full

our testing is and that The breadth our spaceships designing, our of aerospace contractor. expect a the building of you of and team major and depth capabilities quality is might what

spirit. this passionate, team a and structure do true a entrepreneurial a low-cost we and with with However, nimble lean

majority and the development programming, as design design, to analyze hardware of allowing Our full including system, and to hardware development including integration. all analyze, capabilities of entire well software spaceflight are avionics high-performance the as the vertically vehicles of disciplines build, necessary and engineering stack our vast integrated, us avionics test

Ours supports in designing, square operational Spaceship extensive an Company. employees with building, is XXX that team Mojave, California, XXX,XXX flying the and we over feet at campus crewed of over our have and In contractors the supersonic today. team vehicle winged commercial a areas the of world only

well includes advanced hybrid test as qualifying testing and our campus as Mojave for on Our rocket site innovative laboratories our for used vehicles. the structures a motor systems

existing markets to the exploring property this but Leveraging deliver Slide to-date for and Eve capability to for uses. development other Mojave, intellectual serves XX. to advanced manufacturing payloads. and SpaceShipTwo, platform Turning the are our and received VMS other we as capabilities significant in has our mothership interest also leverage

technology XX. and high-speed captive and applications, include Turning configurations, to services, carry long-endurance of for air beds vehicles. of Other Slide mothership high-altitude and test potential future our mobility, research defense development launch applications urban

for will our explore we potential while commencing and future primary our these, be into foreseeable technologies managing the uses. focus expect human evaluate and Now, operations, to other commercial to of our and spaceflight the continue on application

positioned for program. experience and these our well garnered like development opportunities are from lessons from challenging We a learned stemming

vehicle the to we allows winged and and are have We our X. Mach already that of to deploy built in and importantly replicate. a team capital talent already commercial company best We've world has lot a flying new the us at time to achieved firsts This a crewed over efforts. a culture takes assembled efficiently

XX. Slide to Turning

but achievements Now continue am operational business in we we them, and accomplished a and I'd build so I our few. like the on number to of disclosed highlight the turn fourth pleased time, we strong key on quarter. the to I milestones. won't to achieved these all that detail just specific momentum at go of into to great of Many

key Spaceport communications Eve new types. operational We were XXXX, through including and our required external of and aircraft for that and America achieved other control, exercising flights VMS agreements milestones mission at elements, ground operational

to Mexico interior New bringing earlier out our the New current XXX Mexico Virgin Galactic total a in Mojave, the at personnel following transitioned from of operations year-end, the Spaceport by two to California number America of total in build We floors XX staff year.

quarter, also achieved milestones completion We our second design and our on production spaceships activated build rate elements the facility. third our and higher rocket achieved We of of critical systems. motor structure during spaceship key XX% and

Validation We Verification clear FAA and continued in provisos the to quarter.

in Kley assembled of as while President QX, continued Holdings has out Galactic executive team, General earlier Officer announced role. TSC Operating this not company our that We of Chief our Palermo, also we year Michelle in and public Enrico And become to Counsel. newly build Virgin our board a hiring created

to commercial dedication for commitment would progress to our like employees to our and critical launch, all achievements as we and these continue thank mission. of prepare their the for we demonstrate of All I make

our Of Social transaction is listed thing here not course, Hedosophia. with Capital one

the our I'd provide about So Jon our over like fourth and now Financial Campagna, transaction as Officer, to as the turn financial quarter additional results. to Chief detail some call full-year will well who

Jon Campagna

Thanks, George.

October company we This merger our towards as commercial traded Capital commercial Turning only on position publicly transaction to provided strong $XXX spaceflight. our we XXXX, Social and focused a balance On us XX, completed cash million and Slide in creating to world's progress continue Hedosophia, on XX. put sheet the with with of us cash first launch.

As legal, a result of the transaction, $XX fees. underwriting, we incurred million, one-time cost including other and of accounting,

of investment. transaction, our ownership X% via Following XX% the by equity ownership, structure the ownership $XX XX% holders, sponsors, consisted ownership Boeing close the public rollover the million SPAC XX% by ownership of and

We amended of exercise million outstanding statement the upon recently registering registration approximately filed the warrants. for XX shares our purpose of S-X issuable

to We as the make as registration that working are closely statement SEC with quickly effective possible.

requirements, as While we to requirements intention not the current we redeem outstanding any is meet is have wait the would decision. not the to warrants until yet warrants decisions have effective S-X making before whether made such if such and met public our redeem mandatorily we to

XX. to Turning Slide

We our during the quarter with and a commercial our progress pleased to become which public fourth quarter our are reflect transition ongoing launch results, company. towards

from registrations XXXX, flight said February we of George X,XXX reservations of interest XXXX. XXX% September up As XX, of received as earlier, XX, have as X,XXX in

of as quarter services. for by we cash engineering generated was which and with cash the the sheet equivalence December $XXX XXXX. providing Revenue ended XX, balance our $XXX,XXX, million quarter We of on

totaled merger $X was a of million, in quarter and expenditures quarter, Capital from including $XX totaled the which vehicle and in in for $XX Hedosophia, the EBITDA the transaction America on Social loss primarily Capital quarter. with negative fourth costs. fourth Spaceport adjusted comprised Net our investments million basis, non-GAAP tooling applicable costs million

totaled the million, at engineering we Capital $XXX at transporting million XXXX, for operational and on $XXX primarily from overall, including Spaceport applicable by fiscal adjusted support for was $X with our expenditures generated of Social fiscal costs investments Capital negative merger EBITDA revenue million, was Net services. for non-GAAP scientific attributable year the Hedosophia, transaction XXXX. America. Looking XXXX for a $XX to year totaled loss million and in readiness providing which payloads year basis, which was

Slide Turning key performance. of to XX. a EBITDA use We our as measure adjusted

to refer a press excludes stock-based appendix costs. for Adjusted of to and net GAAP release loss. today non-recurring may earnings EBITDA our reconciliation compensation issued the complete of You adjusted transaction EBITDA

context on connection XXXX, our and more costs fourth with as bit audit, a internal a in expense and legal company our for the primarily services Sarbanes-Oxley as efforts increase this and Investor quarter audit to relates XXX, insurance. provide Relations becoming public well To including

Our the with equipment as cost as the employee, VSS associated for and quarter include expenses relocations also for Unity. and vehicle well cabin work interior

feasibility, WhiteKnightTwo’s We later capitalize able to upon future anticipate build and our we costs be will technological for the of SpaceShipTwo’s achievement which in achieving in XXXX.

to revenue, closer detailed get we ticketed we As book report results. to more commercial launch to financial begin and expect

call the to George. back turn now will over I

George Whitesides

Jon. Thanks,

XX. Turning to Slide

may release general we Step new engine of to announced a today, prepare have sale as we to issued reactivate our seen tranche release initiative from the called and As you Small press earlier our have the public. next for seats sales One

commercial which was strategy, December planned historic our in a in sales, new immediately first spaceflight. by XXXX to a formal latest the is close step initiated following This

Our conditions in new the been to objective strong has and to pipeline reopening meantime doors points. higher for optimal business the at create a price in sales preparation

in flow those news media. cadence milestone to as program making customer regular the register progress we including been have During went and reveals online. for rolled our program the spaceflight traditional and this significant interior service. The social interested prospects and of supported in the by encourage commercial of we to through This emphasizing sales of out we spacesuits successful behind XXXX, was was us towards and second with ambition spaceport we the flying updates XXXX, campaigns to create pool a a use spaceflight potentially

extremely been response that delighted have and X,XXX. pleased We with now number flight are approximately reservation registrants the

Our direct in future sales each and leads, funnel is stages. astronaut prospects, now strong of the

augment Step establish prospects, that structure direct the doing structure of the sales pool One in future funnel for qualified support building so, of a additional initiative, growth. we and to return a and are With readiness will in sales now Small channel in

Today's ticket Turning Online front announcement significant sales to for reopen. XX. their to at of ticket line deposit secure future Slide reopen prepare sales. milestone Small as marks place we registrants Step One to initiative of pay our when the the a ticket a reservations, $X,XXX refundable will

to will apply then the $X,XXX spaceflight future reservation. deposit Step We of a price Small the

Step Step will the our seats Step and customer of also astronauts. customers to One terms they new an offers initiatives other dedicated and enjoy Small registrants registrants. be to One the Once program with the in Small released, The relationship to enhanced communications advantages One journey offered Galactic are becoming Virgin on Small to both company. will first

augments allows status. For for the Leap to also sales company, with to and provides spaceflight a It reservation the qualified this conversion establishing a prospects begin of program relationships confirmed pool us Astronaut us future Giant customers. full and funnel with via Future direct One

we One for our the sales unprecedented serves reservation spaceflights we Our qualifying and is qualified development including an a have sales method global to of prospect pool registrations also launch in network continue be Step interest approximately accredited Virgin X,XXX agents. augmented response space of The the interest direct to see as received. for exciting Small will Galactic of channels, also by alternative

to turn at Virgin we opportunity would I Galactic team this Spaceship Company. to Before like and to the fantastic Q&A, take the thank

member. daily every hard and today each reflect the work of achievements Our team

of story our up are opening space. the committed our and we to success are while exciting most chapter to access all We continuing entering

need transportation a long-term investors the and can the to with are at hope We more keeps that the sectors safety look progress continues. forward have space forefront. progress commercial who appreciate sharing for our who to as opportunities the We tremendous the and to at you within pace high-speed here and

Operator

begin we of Instructions] will line At time, [Operator first comes this question our Stanley. from Q&A. Morgan Jonas Your the from Adam

line Your is open.

Adam Jonas

everybody. George, for Thanks And question you.

upfront, you Just share the of what do think kind here? of price

George Whitesides

the everybody. heads executing we're we're is engineering. going with engineers, team keep at what I and and Adam, and space to that's best our and be you. Hi, full And just keeping think hi, to down focused on of on, what we're our just really Nice focused run

So what think. that's I basically

Adam Jonas

I of there's it's could to on One you got items program appreciate items and and whether potentially the of balance the I established the S-X. a because moving lot then cash Step that related Okay. some kind that. asked continue Small sheet that you the up, clearly

even time But wonder, it. in that you really best referring enormity first-mover really the is related you specifically raising don't don't and an it, this why potential Can a market tell want to sometimes you opportunity exercise investors that need might opportunity need logic warrants the as capital need beyond when conditions established And don't given some capital presentation, more the volatile here? to raise what you've to use don't you potential is saying for more? the to I'm transaction. raise given the opportunity that advantage, I not excellent of to – But us

George Whitesides

But That what's strong mean highly and some we back phase this that is developing us and in I first is I Adam, phase can opportunity we that part California Mojave, more some right that ever subject of the are a in technology have that lead is that's a as that that future really thinking thing in we exciting that have transform in the that profitable. initial ways even something really of folks market. of is can hard believe met. smartest that think the is the front Galactic team global places. exciting other about about they're into now. an market And working I've And transportation we on

right about been we're take our think by forward and the process entire it this. process. I we move around that thinking roll we'll keep and I forward We're really to as a now, focused opportunity look in I go people look thinking we're think going I've to about excitement we going think so we information the that we're have I planet. market situation carefully more design and sharing And our felt to But approach But really how with monitoring. gratified out. share And price, the be transform on the the to engineering. like, how to really always, staged by this the as gratified at

Operator

comes line Credit of Spingarn] Your [Daryl from Suisse. next question the from

Your line is open.

Robert Spingarn

Rob It's Spingarn. afternoon. good Hi,

George Whitesides

Rob. Hey,

Robert Spingarn

couple questions I Hey, of got you. and both a of for George, Jon.

George Whitesides

Yes.

Robert Spingarn

of the thinking One pricing to tranche what Step planning George Small you're how large seats that start to next wanted that I kind be about? ask and of and I would you're with you release

George Whitesides

Yes.

focused sharing strategy of I the Step rollout very So Right that's over course both will mean, seats the year. program. pricing our the And I be Small premium we on a now, important the that of number of be question. on information think, we're more and the releasing very we will

and it of little X,XXX was you X by X,XXX roughly it surprise to today, was And sort top, hundred of a forward have now to the of then with what right? X by leaps bit $XX folks the mean it's up really and we've I And which who it exciting is, the who've a to because as to market our I over think, just by we're we've up a expressed way, a us, buy a we're than that that validation at trying that's a few bounds. to me looking trying do around I million what of – great folks the this funnel, million sharing – if sort just frankly of So have what to with desire to net build. a And folks ticking recently have started think worth. had going a you really and then been up approach ticket say less million, like

funnel, you go future people is to put either you $XXX business. folks then the or the who they this of want level if of representing group about of number group the that of of you deposit full if million next have who've that large okay, $XX think, to million, sort these is a the buy So substantial afford sort already said XXX down of $XXX of first people down it. bottom deposits well and And can million it,

through to But to to of think trying there. see in today help tremendous jump allows sales for what What eager next is basically we'll people, to too just we tomorrow, constraint most identify our going we what tranche we've tranche And the just we're ships, another forward, we're that may we announcing is because are is to much that and to do of five a these which it's the us market. and because build obviously go start while the capacity folks in think who it's amount adding be customers Step expressed open to as really a flights. that do, on a Small we a supply us our even chance for we even prospects funnel to and move our the we're not street, past if in business in

sure so really make folks. focused want And we're to we on

premium this do validated the market as back last that Moses is We phone the on the seeing of we're year. we'll be interest that great we a by Beth higher with on – well terms extreme justified offering as price in into the know, think of folks Now pricing, the that product point. going many that's the plan as and

Small connecting with out know the that thousands great said getting that that talking course really we're be right, buying have that in these And in more over a focused we'll Step rolling interest there's who of on ticket. it and introduction they're and Today, year. of So having about that. lot the interested of a that people of a we

Robert Spingarn

we to queue to… Okay. wanted And if I ask you back could here, if I'm still in go the

George Whitesides

Fairly, are. you

Robert Spingarn

more. Okay, good. I have a couple

George Whitesides

Okay.

Robert Spingarn

go XX, talked the you we three back about the to Slide areas. If

George Whitesides

Yes.

Robert Spingarn

influx you get updating this are flight the as still the those perfect everything vehicles, you the And it. test as you schedule what are to and and for like sounded readying on schedules the as a to customer the it you’re key get so that get to experience flight? three you before need commercial when gating items test through first program, need mid-summer, little And bit among

George Whitesides

as we number That's number is fly, one what in flight Well, Sir anybody program. our and employees our the organization fly fly pilots in XXXX. you one as the know, fly Richard That's that What know, Yes. our fly into but to really our we know just is not priority space or flight we're priority that safely, the were entire test that we late commercial priority. number one whether on Richard, it's top a affirming priority. today, – you that's is Branson they might to

don't detail a about of talk bit I these breaking bit in during remarks. terms it a three those out little more areas. mind little did I

we a really on hard lot on suits of be But going the terms the It's in you to the It's things. really experience, experience. are even – you're experience, those seats flights all before do spaceport those and experience just the of get obviously the on to rocket-powered In of some there's to all not finishing [indiscernible] it's experience. a glide to of the the obviously between some flights terms and of needing phases. the focus flight test program, – customer the the be ground end-to-end lot working in-flight also and the of cabin going and

vehicles comments. the for readying is high little thing my a third about that bit the then And in long-term I rate service. talked

we going to a we company big that make this thing not XXXX a really success. a ultimately focus revenue that great it market. going around of What's is we to a vehicle a and know into we turn of can a then that's make so in fleet So that generate the rapidly do and great make add having because to amount want success that really them, can the is on we capacity build that a more relatively basis, consistent

So on that focused those are going really go to forward. the we're we be things as

a Mexico able to way technical a deal the also go Spaceport New to-date, spaceship going moving great a in to that, points both program, had milestones. and through America down to one as thing, on down but have we program there. It first readiness. keep that big test key We're was hour. getting we've Mojave with the look our progress build We do because communicating Unity forward on say as I a big a to on operational three the We're down. some people down we the was will updated it And was basis, flight test deal. vehicle

deal think on building joining the soak but team folks the the I now also already have cold particularly Mexico XX up. way, around relocated, of a who have team, hours three New a there had – We in for big team had,

down we'll both New able milestone vehicles it's the Mexico. flight, next So above be to next free Mexico New really what big Spaceship I'm where glide Unity have And in a flying focused on see sky. to is,

Operator

Your next Vertical Genovesi Research. the from from Darryl line question comes of

Your open. line is

Darryl Genovesi

Hi guys. time. Thanks for the

George Whitesides

Hey, Darryl.

Jon Campagna

Darryl. Hey,

Darryl Genovesi

the the is at X% the I Steven in Hey. progression market you whether X%, make around can't how room, George of you test to of addressable plus and elasticity I how of price as sort or where think guess, million the sort from points I to if look chart you show proceed ultimately $XX or to decision when your of to but the to not initial want that plan help, down path? the you

but thinking just how any wondering give as you sort Do progress around going we you're specifically? some the us of forward said the how get pricing to thoughts to on you have more year, – progression through comments about you're

George Whitesides

Obviously, test it. Yes. on probably to very can I that focused ways pricing mean public you and use both a we're you're there's aware private and elasticity. market then variety that of

the some of the this on have We world stuff. advisers in best

so different few methods. using we're a And

is of a people what flying are things think with amount There to clear a desire flights, or on with – large, there's people want that. like huge but folks there fair Richard a to desire a a who flights, I other get be with themselves. They're that. however we people. to by see The that us. to there's will of is And who then charter is who fly like love is fly couples even number in special define fly early you

premium This for I think maybe there's will well. experiences. we be in good a to single won't for variety that layer ways experience add great of pricing be that a also where types as of like going of so company be thing, packages sort customers, really able different but to the And we the

cheaper for research to The than exciting is seeing is trying in market very orbital an that pricing to if we're great. facility. the that pricing obviously, still Even hugely up good other is the us, thing it's is something that send

progress good And on kind funding on some – they well. so talking And are of able we're that. document that. human-tended flights NASA I as course, going that human be about to – out tended put think on to of They is make considering

I a So premium think pricing. lot of opportunities for there's interesting

Operator

would conference this we XXXX concludes like At today's conference joining thank call. time, call. and Virgin for quarter everyone to earnings full-year Galactic's This fourth

You may now disconnect.