- Revenue of approximately $72 million for the six months ended
June 30, 2021
- Over $150 million in new contract awards since the end of the
second quarter
- Analytics segment adjusted gross margin of 48%
- Ramping of investments/workforce to execute on growth strategy;
75+ hires year-to-date across R&D, sales and marketing and
product/service delivery
- Entered into multiple commercial strategic agreements,
including a multi-year transformational commercial partnership with
Virgin Orbit
- Business Combination with GigCapital4 on track to close in
fourth quarter 2021
BigBear.ai, a leading provider of artificial intelligence
(“AI”), machine learning, cloud-based big data analytics, and cyber
engineering solutions, today announced financial results for the
six months ended June 30, 2021.
“BigBear.ai’s steady pace of contract awards and expanded
customer engagements drove our strong year-to-date revenue and
backlog growth. This is a testament to our successful track record
for growing customer relationships by seamlessly implementing
flexible solutions that enable customers to make critical decisions
faster, more accurately and with better outcomes,” said Dr. Reggie
Brothers, BigBear.ai Chief Executive Officer. “Our investments for
commercial penetration and public company readiness have proceeded
according to plan. I am also very pleased to report that we
recently signed two major contract awards that add more than $150
million to our backlog as well as a new transformational commercial
agreement that will generate annual recurring revenue of $6 million
over four years. Though timing of these key contract awards
differed slightly from our expectations due to COVID-related delays
and pushed a portion of our revenue growth later in the year than
anticipated, this revenue is now on board. This timing difference
between our investments and revenue will largely be settled in the
second half of 2021, when our adjusted EBITDA will reflect the true
performance of the company.”
Dr. Brothers continued, “We are looking forward to completing
our business combination with GigCapital4 later this year and for
BigBear.ai to emerge as a public company. This will further
accelerate our growth as we invest to develop new technology and
expand into commercial markets, where we see substantial
opportunities for our AI-powered solutions, which enable companies
to make better decisions based on the massive amount of data they
are rapidly accumulating.”
Second Quarter Financial
Highlights
- Year-to-date revenue of approximately $72 million
- Year-to-date gross margin of 27%, incrementally lower than
expected due to higher, non-recurring subcontractor costs to
capture immediate growth opportunities
- Year-to-date segment adjusted gross margin of 48% for the
Analytics segment and 22% for the Cyber & Engineering
segment
- Year-to-date net loss of $5.6 million reflecting a timing
difference between the company’s planned investments through the
period and delay in revenue/contract awards as a result of
COVID
- Year-to-date non-GAAP adjusted EBITDA* of approximately $3.3
million
Recent Customer Wins and
Awards
- Since June 30, added more than $150 million of new contract
awards, which, combined with BigBear.ai’s backlog as of June 30,
2021, totals approximately $485 million. Key awards include the
following:
- Entered into a transformational multi-year commercial
partnership with Virgin Orbit for the real-time deployment of
AI-powered software for mobile assets in the field; the development
of applications that can identify objects, analyze ground material,
map land and monitor climate in space; and the use of innovative
products that fuse data from multiple intelligence data
- Awarded a five-year, single-award contract, valued at $141
million, to provide business analytics to a key customer in the
intelligence community
- Received a Notice of Intent for a two-year contract award from
the Air Force Research Laboratory in support of Project AURORA, in
which BigBear.ai will deploy its Observe, Orient and Dominate
products to accelerate and enhance the joint planning
decision-making cycle
- Executed a MOU with UAV Factory to develop AI and machine
learning capabilities for unmanned systems and components used in
the commercial and defense markets
Financial Outlook
BigBear.ai is revising its previously announced projections for
fiscal year 2021 due to COVID-related delays in the timing of
select government contract awards. Three contracts, with a combined
value of approximately $150 million, were awarded as much as six
months later than initially projected, which moved the entire
expected period of performance for those contracts correspondingly.
The company reiterates its previously announced financial
projections for fiscal year 2022, due to the visibility in already
awarded contracts.
The company is projecting:
- Revenue between $88 million and $113 million in the second half
of 2021, bringing full-year projected revenue between $160 million
and $185 million
- Adjusted EBITDA* between $9.2 million and $10.2 million in the
second half of 2021, bringing full-year projected adjusted EBITDA*
between $12.5 million and $13.5 million after accelerated sales and
marketing and R&D costs to drive growth strategy
Business Combination with
GigCapital4
As previously announced, BigBear.ai and GigCapital4, Inc.
(“GigCapital4”; Nasdaq: GIGGU, GIG, GIGGW) a private-to-public
equity (PPE)™ entity also known as special purpose acquisition
company (“SPAC”) have entered into a definitive merger agreement
that will result in BigBear.ai becoming a publicly traded company.
The transaction is expected to close in the fourth quarter of 2021,
subject to, among other things, the approval by GigCapital4
stockholders, regulatory approvals, and the satisfaction or waiver
of other customary closing conditions.
Summary of Results for the Six Months Ended June 30,
2021
Six Months Ended June 30,
20211
Revenues
$
71,881
Cost of revenues
52,438
Gross margin
19,443
Operating expenses:
Selling, general and administrative
20,519
Research and development
2,795
Transaction expenses
-
Operating loss
(3,871
)
Interest expense
3,709
Other income, net
(1
)
Loss before taxes
(7,579
)
Income tax benefit
(1,967
)
Net loss
$
(5,612
)
1 Amounts presented are unaudited
EBITDA and Adjusted EBITDA for the Six Months Ended June 30,
2021
Six Months Ended June 30,
20211
Net loss
$
(5,612
)
Interest expense
3,709
Income tax benefit
(1,967
)
Depreciation and amortization
3,673
EBITDA
(197
)
Adjustments:
Capital market advisory fees2
2,446
Management fees3
454
Non-recurring integration costs4
505
Equity-based compensation
56
Adjusted EBITDA
$
3,264
1 Amounts presented are unaudited. 2 The company incurred
capital market and advisory fees related to advisors assisting with
preparation for the Business Combination. 3 Management and other
related consulting fees paid to AE Partners. These fees will no
longer be accrued or paid subsequent to the Business Combination. 4
Internal integration costs which will cease upon close of the
Business Combination.
About BigBear.ai
A leader in decision dominance for more than 20 years,
BigBear.ai operationalizes artificial intelligence and machine
learning at scale through its end-to-end data analytics platform.
The company uses its proprietary AI/ML technology to support its
customers’ decision-making processes and deliver practical
solutions that work in complex, realistic and imperfect data
environments. BigBear.ai’s composable AI-powered platform solutions
work together as often as they stand alone: Observe (data ingestion
and conflation), Orient (composable machine learning at scale), and
Dominate (visual anticipatory intelligence and optimization).
BigBear.ai’s customers, which include the U.S. Intelligence
Community, Department of Defense, the U.S. Federal Government, as
well as customers in the commercial sector, rely on BigBear.ai’s
high value software products and technology to analyze information,
identify and manage risk, and support mission critical decision
making. Headquartered in Columbia, Maryland, BigBear.ai has
additional locations in Virginia, Massachusetts, Michigan, and
California. For more information, please visit: http://bigbear.ai/
and follow BigBear.ai on Twitter: @BigBearai.
Additional Information and Where to
Find It In connection with the proposed business
combination, GigCapital4 has filed with the Securities and Exchange
Commission (the “SEC”) a preliminary proxy statement under the
rules of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”). GigCapital4 will subsequently mail a definitive
proxy statement relating to the proposed business combination to
its stockholders. This press release does not contain all the
information that should be considered concerning the proposed
business combination and is not intended to form the basis of any
investment decision or any other decision in respect of the
business combination. Additional information about the proposed
business combination and related transactions will be described in
GigCapital4’s proxy statement relating to the proposed business
combination and the respective businesses of GigCapital4 and
BigBear.ai. The proposed business combination and related
transactions will be submitted to stockholders of GigCapital4 for
their consideration. GigCapital4’s stockholders and other
interested persons are advised to read the preliminary proxy
statement and, when available, the amendments thereto and the
definitive proxy statement and other documents filed in connection
with GigCapital4’s solicitation of proxies for its special meeting
of stockholders to be held to approve, among other things, the
proposed business combination and related transactions, because
these materials will contain important information about
BigBear.ai, GigCapital4 and the proposed business combination and
related transactions. When available, the definitive proxy
statement and other relevant materials for the proposed business
combination will be mailed to stockholders of GigCapital4 as of a
record date to be established for voting on the proposed business
combinations and related transactions.
Stockholders may also obtain a copy of the preliminary or
definitive proxy statement, once available, as well as other
documents filed with the SEC by GigCapital4, without charge, at the
SEC’s website located at www.sec.gov or by directing a request to
Brad Weightman, Vice President and Chief Financial Officer,
GigCapital4, Inc., 1731 Embarcadero Rd., Suite 200, Palo Alto, CA
94303, or by telephone at (650) 276-7040.
Participants in
Solicitation
BigBear.ai, GigCapital4 and their respective directors and
executive officers and other persons may be deemed to be
participants in the solicitations of proxies from GigCapital4’s
stockholders in respect of the proposed business combination and
related transactions. Information regarding GigCapital4’s directors
and executive officers is available in its final prospectus
prepared and filed with the SEC on February 10, 2021, under Rule
424(b)(4) promulgated by the SEC pursuant to the Securities Act of
1933, as amended (the “Securities Act”) and related to its
previously filed Registration Statement on Form S-1. Additional
information regarding the participants in the proxy solicitation
and a description of their direct and indirect interests will be
contained in the preliminary and definitive proxy statements
related to the proposed business combination and related
transactions when it becomes available, and which can be obtained
free of charge from the sources indicated above.
Forward-Looking
Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act, and Section 21E
of the Exchange Act. Forward-looking statements may be identified
by the use of words such as “estimate,” “plan,” “project,”
“forecast,” “intend,” “will,” “expect,” “anticipate,” “believe,”
“seek,” “target” or other similar expressions that predict or
indicate future events or trends or that are not statements of
historical matters. These forward-looking statements include, but
are not limited to, statements regarding estimates and forecasts of
other financial and performance metrics, and projections of market
opportunity and market share, and the timing of the consummation of
the business combination. These statements are based on various
assumptions, whether or not identified in this press release, and
on the current expectations of management of BigBear.ai and are not
predictions of actual performance. These forward-looking statements
are provided for illustrative purposes only and are not intended to
serve as, and must not be relied on by any investor as, a
guarantee, an assurance, a prediction or a definitive statement of
fact or probability. Actual events and circumstances are difficult
or impossible to predict and will differ from assumptions. Many
actual events and circumstances are beyond the control of
BigBear.ai. These forward-looking statements are subject to a
number of risks and uncertainties, including changes in domestic
and foreign business, market, financial, political, and legal
conditions; the inability of the parties to successfully or timely
consummate the proposed business combination, including the risk
that any required regulatory approvals are not obtained, are
delayed or are subject to unanticipated conditions that could
adversely affect the combined company or the expected benefits of
the proposed business combination or that the approval of
stockholders is not obtained; failure to realize the anticipated
benefits of the proposed business combination; risks relating to
the uncertainty of the projected financial information with respect
to BigBear.ai; risks related to the rollout of BigBear.ai’s
business and the timing of expected business milestones; the
effects of competition on the combined company’s future business;
the amount of redemption requests made by GigCapital4’s public
stockholders; the ability of GigCapital4 or the combined company to
issue equity or equity-linked securities in connection with the
proposed business combination or in the future. If any of these
risks materialize or BigBear.ai’s or GigCapital4’s assumptions
prove incorrect, actual results could differ materially from the
results implied by these forward-looking statements. Additional
factors that could cause actual results to differ are discussed
under the heading “Risk Factors” and in other sections of
GigCapital4’s filings with the SEC, and in GigCapital4’s current
and periodic reports filed or furnished from time to time with the
SEC. There may be additional risks that neither GigCapital4 nor
BigBear.ai presently know or that they currently believe are
immaterial that could also cause actual results to differ from
those contained in the forward-looking statements. In addition,
forward-looking statements reflect GigCapital4 and BigBear.ai’s
expectations, plans or forecasts of future events and views as of
the date of this press release, based on information available to
GigCapital4 and BigBear.ai as of the date hereof. GigCapital4 and
the company assume no obligation to update any forward-looking
statement, whether as a result of new information, future events or
otherwise, except as may be required under applicable securities
laws. While GigCapital4 and BigBear.ai may elect to update these
forward-looking statements at some point in the future, GigCapital4
and BigBear.ai specifically disclaim any obligation to do so. These
forward-looking statements should not be relied upon as
representing GigCapital4’s and BigBear.ai’s assessments as of any
date subsequent to the date of this press release. Accordingly,
undue reliance should not be placed upon the forward-looking
statements.
Non-GAAP Financial Measure and Related
Information
The financial information and data contained in this press
release is unaudited and does not conform to Regulation S-X
promulgated under the Securities Act. Accordingly, such information
and data may not be included in, may be adjusted in or may be
presented differently in, any proxy statement to be filed by
GigCapital4 with the SEC. Some of the financial information and
data contained in this press release, such as Adjusted EBITDA, have
not been prepared in accordance with United States generally
accepted accounting principles (“GAAP”). Adjusted EBITDA is defined
as of any date of calculation, the consolidated pro forma earnings
of the company and its subsidiaries, before finance income and
finance cost (including bank charges), tax, depreciation and
amortization calculated from the audited consolidated financial
statements of such party and its subsidiaries (prepared in
accordance with GAAP), transaction fees and other non-recurring
costs. Similar excluded expenses may be incurred in future periods
when calculating these measures. GigCapital4 and BigBear.ai believe
these non-GAAP measures of financial results provide useful
information to management and investors regarding certain financial
and business trends relating to the company’s financial condition
and results of operations. GigCapital4 and BigBear.ai believe that
the use of these non-GAAP financial measures provide an additional
tool for investors to use in evaluating projected operating results
and trends in and in comparing BigBear.ai’s financial measures with
other similar companies, many of which present similar non-GAAP
financial measures to investors. Management does not consider these
non-GAAP measures in isolation or as an alternative to financial
measures determined in accordance with GAAP. The principal
limitation of these non-GAAP financial measures is that they
exclude significant expenses and income that are required by GAAP
to be recorded in the company’s financial statements. In addition,
they are subject to inherent limitations as they reflect the
exercise of judgments by management about which expense and income
are excluded or included in determining these non-GAAP financial
measures.
Management uses EBITDA and adjusted EBITDA as a non-GAAP
performance measure which is defined in the accompanying tables and
is reconciled to earnings (loss) before taxes.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210920005468/en/
Reevemark Paul Caminiti/Delia Cannan/Pam Greene 212-433-4600
bigbear.ai@reevemark.com
or
Lambert & Co. Jennifer Hurson (845) 507-0571
jhurson@lambert.com
Caroline Luz 203-656-2829 cluz@lambert.com
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