GomSpace and ESA will not proceed to the next phase of climate observation mission

GomSpace and ESA will not proceed to the next phase of climate observation mission
After completing the requirement specification phase for the Scout-1 Mission for climate observation (CubeMap), a decision has been made not to continue to the next phase of implementation
On December 6, 2021, GomSpace and UK partner, RAL Space, signed a contract with ESA for the Scout-1 Mission for climate observation, known as CubeMap. During the past year, the parties have been working on completing the scope and requirement specifications.

After several negotiations between ESA, GomSpace, and UK partner, RAL Space, the conclusion has been that it is not possible for GomSpace and RAL Space to deliver the Scout-1 Mission inside the program budgetary constraints that ESA has set. Consequently, ESA has today informed GomSpace and RAL Space that it will not continue the CubeMap mission.

CEO of GomSpace, Carsten Drachmann comments: “First of all, I want to thank our partner RAL Space for the work we have done together during the past year, and I especially want to thank the program management from ESA side, who has actively been trying to find ways to make this mission work. The cancellation is not a desired or easy outcome for anybody involved, but from GomSpace side, we decided to follow our principle of reaching a reasonable profitability and cashflow on everything that we do. In the end, the consortium was too far away from the budget available from ESA, and there was no support to continue the mission under these conditions. I would very much have liked to complete the CubeMap mission under the direction we have set for GomSpace with focus on profitability and cashflow. Despite current disappointments in not being to complete such an exciting mission, I am looking forward to continuing our new space explorations in other areas, together with ESA and other partners.”

The company informs, that out of the original contract value share of EUR 7,000,000 directly to GomSpace, as announced on December 6. 2021, the company has invoiced approx. EUR 3,200,000 for the work done to date.

The remainder of EUR 3,800,000 will be reduced from the order backlog. It should be noted that this revenue was not expected to have any contribution margin under the conditions given.

As part of the original contract from December 2021, GomSpace reported an order intake of EUR 24,000,000 whereof EUR 17,000,000 was for passthrough sales to 3rd parties. Approx. EUR 650,000 has been invoiced to date and the order backlog for passthrough sales will net be reduced with EUR 16,350,000. There is no contribution margin on these passthrough sales.

Carsten Drachmann continuous: “Financially this will of course change our top-line short term, but it is however expected to have relatively limited impact on our contribution margin and free cashflow, under the circumstances given.”

For more information, please contact:
Carsten Drachmann (CEO)
Tel: +45 40 63 40 36
E-mail: cdra @ gomspace.com

About GomSpace Group AB
The company’s business operations are mainly conducted through the wholly-owned Danish subsidiary, GomSpace A/S, with operational office in Aalborg, Denmark. GomSpace is a space company with a mission to be engaged in the global market for space systems and services by introducing new products, i.e. components, platforms and systems based on innovation within professional nanosatellites. The company is listed on the Nasdaq First North Premier exchange under the ticker GOMX. FNCA Sweden AB is the Company’s Certified Adviser. For more information, please visit our website on www.gomspace.com.

Miscellaneous
This information is information that GomSpace is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, 2:10 p.m. CEST on May 31, 2023.
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https://news.cision.com/gomspace-a-s/r/gomspace-and-esa-will-not-proceed-to-the-next-phase-of-climate-observation-mission,c3777962
The following files are available for download:
https://mb.cision.com/Main/14387/3777962/2096891.pdf CubeMap Discontinuation
https://news.cision.com/gomspace-a-s/i/collaboration-3,c3184498 Collaboration 3