Redwire (RDW) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue rose 30% year-over-year to $78.1 million, the second highest quarterly revenue in company history, driven by larger contracts and increased production in power generation offerings.

• Adjusted EBITDA was $1.6 million for Q2 2024, with LTM Adjusted EBITDA up 94.6% year-over-year to $12.6 million.

• Net loss widened to $18.1 million in Q2 2024, including a $9.0 million non-cash loss from warrant liability revaluation.

• Bookings surged to $114.4 million in Q2 2024, with a book-to-bill ratio of 1.47 for the quarter and 1.28x LTM; contracted backlog increased 29.9% year-over-year to $354.3 million.

• Ending liquidity as of June 30, 2024, was $55.8 million, with positive LTM net cash from operations of $5.7 million.

Financial highlights

• Q2 2024 revenue was $78.1 million, up from $60.1 million in Q2 2023; H1 2024 revenue reached $165.9 million, a 41% increase over H1 2023.

• Gross margin for Q2 2024 was $12.98 million (16.6%), down from $15.9 million (26%) in Q2 2023, impacted by $3.1 million in negative EAC adjustments.

• Net loss for Q2 2024 was $18.1 million, compared to $5.5 million in Q2 2023, primarily due to lower gross margins and warrant liability loss.

• Adjusted EBITDA for Q2 2024 was $1.6 million, down from $4.4 million in Q2 2023.

• SG&A expenses as a percentage of revenue decreased to 23.2% in Q2 2024 from 29.4% a year ago.

• Net cash used in operations was $9.5 million for Q2 2024, but LTM cash from operations was positive at $5.7 million.

• Available cash and equivalents stood at $30.8 million as of June 30, 2024.

Outlook and guidance

• Full-year 2024 revenue guidance reaffirmed at $300 million, representing 23% year-over-year growth.

• 55% of annual revenue guidance achieved in the first half of 2024.

• Management expects existing liquidity to be sufficient for at least the next twelve months.

• Focus remains on improving program management, reducing EAC volatility, and increasing operating leverage and cost efficiency.