Virgin Orbit's near future in "substantial doubt" over cash position - filing
Reuters
Published Apr 03, 2023 06:07PM ET
Updated Apr 03, 2023 06:21PM ET
By Joey Roulette
WASHINGTON (Reuters) - Richard Branson's Virgin Orbit Holdings in a U.S. regulatory filing on Monday said there is "substantial doubt" its cash position will allow it to continue operating for at least the next 12 months.
Days after announcing the layoff of nearly its entire workforce, the launch company said it expects to disclose in a forthcoming filing that its "liquidity condition raises substantial doubt about the company's ability to continue as a going concern for at least 12 months" from the expected issuance date of its annual 10K filing, the company said in a Securities and Exchange Commission filing.
Virgin Orbit's statement came in a notice explaining why it had yet to file its annual 2022 report. It attributed the delay to "potential fundraising transactions" and limited resources and staff amid an "operational pause and workforce reduction."
Struggles to raise funds in recent months and a January rocket failure increased pressure on the company to find new funding. The company on March 16 began a furlough of nearly all its 750 employees as it sought a new investment plan.
Unable to secure new funds, Virgin Orbit on Thursday moved to lay off roughly 85% of its workforce, or about 675 employees.
Virgin Orbit, spun off from Branson's space tourism firm Virgin Galactic in 2017, went public in 2021 through a blank-check deal, where it raised $255 million, less than expected.
"As of December 31, 2022, we have not generated positive cash flows from our operations or generated sufficient revenues to provide sufficient cash flows to enable us to finance our operations, and may not be able to raise sufficient capital to do so," Monday's filing said.
It added it expects to report for 2022 roughly $33.1 million in revenue and a net loss of about $191 million.
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Written By: Reuters
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