WASHINGTON — Virgin Galactic has pushed the beginning of commercial flights of its SpaceShipTwo suborbital vehicle to no earlier than the first quarter of 2021 while announcing plans to sell additional stock to raise money.
The company, in its fiscal second quarter financial results released Aug. 3, said it expected to perform two more test flights of SpaceShipTwo from Spaceport America in New Mexico, both of which will be powered flights. The vehicle has made two glide flights since moving to the spaceport early this year.
The first of those powered flights, scheduled for the fall, will have two pilots on board. It will also carry payloads for NASA’s Flight Opportunities program that arranges flights of experiments on suborbital vehicles, said George Whitesides, chief space officer and former chief executive of Virgin Galactic, in a company earnings call.
If that flight goes as expected, Virgin Galactic will then perform a second flight, this time with four mission specialists on board along with the two pilots. Those mission specialists “will evaluate the performance of our full customer cabin and associated hardware,” he said. The company unveiled the design of the cabin July 28, although Whitesides said they were still completing the installation of the cabin on the company’s current SpaceShipTwo vehicle, VSS Unity.
“Presuming things go as expected on this fully-crewed flight, we would then plan to fly Sir Richard Branson on the third powered flight from New Mexico,” he said. That flight would take place in the first quarter of 2021 and mark the beginning of commercial service, although Whitesides said it will also be a test flight of sorts. “Sir Richard is in a unique position to provide the ultimate cabin and spaceflight experience evaluation, as a visionary of the Virgin customer experience.”
The statement is an acknowledgement that the company won’t begin commercial flights this year. When Virgin Galactic announced its merger in July 2019 with Social Capital Hedosophia, a publicly traded holding company, it said it planned to begin commercial service by mid-2020. Earlier this year, the company backed away from that schedule, saying in February its goal was to fly Branson by the end of the year.
Whitesides said in the call that the coronavirus pandemic had slowed down work on SpaceShipTwo, including planning for test flights. “Our test flight schedule has been impacted by COVID-19,” he said. “The COVID protocols that we have put in place have limited the number of people that we can bring back into the facility in both New Mexico and Mojave, reducing the pace at which we can work compared to pre-COVID.”
The pandemic also slowed sales. Whitesides the company temporarily suspended marketing of its “One Small Step” initiative, where prospective customers can pay a $1,000 deposit to be first in line when the company resumes ticket sales. The company has since resumed marketing of the program has now has more than 700 people signed up, he said. Virgin Galactic has not disclosed when it plans to resume ticket sales, or what price it will charge.
Virgin Galactic announced June 22 it would start offering orbital spaceflight experiences, including working with NASA through a Space Act Agreement. Whitesides said in the call that the company has talked with its existing suborbital spaceflight customers about paying a “significant refundable deposit” for an orbital flight, and that 12 people had signed deposit agreements with the company.
Those people, he said, viewed a SpaceShipTwo flight as potential training for those orbital flights. Whitesides, though, did not disclose the size of the deposits or other details about when and how those customers would fly to orbit. The price, he said, will be “competitive with other offerings in the market, and with the premium service and training that people expect from the Virgin Galactic brand.”
Virgin Galactic reported no revenue in the second quarter of 2020 and a net loss of $63 million. That is similar to what the company reported in the first quarter, and Jon Campagna, Virgin Galactic’s chief financial officer, called it an “approximate indication of our ongoing cash burn” for current operations. The company has $360 million in cash as of the end of the second quarter.
“However, there may be some strategic initiatives that we decide to invest in that may lead to an increase in our burn rate,” he added. Earlier in the day, the company released a conceptual design for a supersonic passenger aircraft capable of carrying up to 19 people at up to Mach 3. The company didn’t disclose a schedule or estimated cost of the vehicle, but did state it has a memorandum of understanding with Rolls-Royce to study airbreathing engines needed for that vehicle.
Shortly after releasing its second quarter earnings, the company announced it had filed with the U.S. Securities and Exchange Commission to sell up to 20.5 million shares of stock, with an option to sell an additional 3 million. The company said it expected to sale to raise $460 million, and use the net proceeds “primarily for general corporate purposes, including working capital, general and administrative matters and capital expenditures.”
Virgin Galactic executives declined to take questions about the planned sale, or other aspects of the company’s performance, from industry analysts on the call, citing restrictions about company disclosures in SEC regulations regarding public offerings.
Virgin Galactic to resume SpaceShipTwo test flights in mid-February
WASHINGTON — Virgin Galactic announced Feb. 1 that the company will launch its SpaceShipTwo suborbital spaceplane in mid-February, two months after a technical problem aborted an earlier launch attempt.
In a statement, Virgin Galactic said the window for its next SpaceShipTwo flight will open Feb. 13 at Spaceport America in New Mexico. The exact date of the flight will depend on “good weather conditions and technical readiness,” the company said.
The powered test flight will have two pilots on board, as well as research payloads for NASA’s Flight Opportunities program. The goal of the flight will be to exceed the altitude of 80 kilometers that Virgin Galactic uses as the boundary of space, the first time that SpaceShipTwo has done so since a February 2019 flight from the Mojave Air and Space Port in California.
Virgin Galactic had planned to conduct this test flight in December. Moments after the spaceplane’s release from the WhiteKnightTwo aircraft Dec. 12, its hybrid rocket motor ignited but almost immediately shut down. SpaceShipTwo glided to a safe landing at Spaceport America.
The company said that a computer lost connection at the time of ignition, triggering the engine shutdown. “The team has since conducted the root cause analysis, completed the corrective work required, and carried out extensive ground testing,” it stated in the announcement of the upcoming flight, but did not disclose additional details about those efforts.
“We are pleased to be able to get back to the skies and continue our flight test program,” Michael Colglazier, chief executive of Virgin Galactic, said in the statement.
As with the December test, Virgin Galactic will have only essential personnel at the spaceport for the test, with no media or guests in attendance, citing COVID-19 protocols by both the company and the state of New Mexico. Sierra County, where Spaceport America is located, is in the middle or “yellow” tier of the state’s framework of restrictions on businesses and other activities, intended to reduce the spread of COVID-19.
The upcoming flight is the first of three Virgin Galactic outlined during an earnings call in November. A second flight would carry two pilots as well as four additional employees to test the cabin interior and the “weightless experience in space” in advance of carrying customers. A third would fly the company’s founder, Richard Branson, who long said he would be on the company’s first commercial flight.
At the time of that call, Virgin Galactic thought it would be able to fly the second and third flights in that sequence in the first quarter of 2021, with the first flight scheduled for November. The company did not update that schedule in the announcement of the upcoming flight. The company will hold its next earnings call, tied to the release of its fourth quarter and full year financial results, Feb. 25.
Virgin Galactic shares climb as FAA indicates next spaceflight test set for Saturday
- Virgin Galactic’s stock climbed as a notice from the Federal Aviation Administration indicated that the company’s next spaceflight test is on track to launch as early as Saturday.
- An FAA notice on Thursday said airspace around Virgin Galactic’s base of operations at Spaceport America in New Mexico would be restricted for space operations from Saturday at 9 a.m. ET through Sunday at 6 p.m. ET.
- The spaceflight test will be a redo of the December attempt the company aborted mid-launch.
Shares of Virgin Galactic climbed as a notice from the Federal Aviation Administration indicated that the company’s next spaceflight test is on track to launch as early as Saturday.
An FAA notice posted on Thursday said that airspace around Virgin Galactic’s base of operations at Spaceport America in New Mexico would be restricted for space operations from Saturday at 9 a.m. ET through Sunday at 6 p.m. ET.
A Virgin Galactic spokesperson confirmed to CNBC that the company is “making good progress through our flight preparations,” noting that the flight attempt is pending weather and technical readiness.
Virgin Galactic’s stock climbed 13% in trading to close at $59.41 a share.
The spaceflight test will be a redo of the December attempt the company aborted mid-launch. Virgin Galactic spent two months analyzing the cause of the abort and carrying out ground testing, with the test flight set to check “the remedial work that has been completed.”
While only two pilots will be on board, the flight is expected to be the first of three in a series as the company seeks to finish development of its spacecraft system.
Virgin Galactic will be aiming for each of the original objectives of the December flight attempt, “including evaluating elements of the customer cabin, testing the live stream capability from the spaceship to the ground, and assessing the upgraded horizontal stabilizers and flight controls during the boost phase of the flight,” the company said.
After the flight test, Virgin Galactic said it will “complete an extensive data review” to “inform the next steps in the test flight program.”
The stock has more than doubled since the beginning of 2021, a move which earlier this week caused UBS to lower its rating on the stock to neutral. UBS said in a note to clients that “we’re mindful of valuation that appears full,” even though upcoming test flights create an appealing “catalyst chain.”
Timing of next Virgin Galactic flight still up in the air
Virgin Galactic has put off plans to make another attempt at a rocket-powered flight from New Mexico to the fringe of space
This photo provided by Virgin Galactic shows SpaceShipTwo Unity being released from the carrier mothership, VMS Eve for second successful glide flight in New Mexico on Thursday, June 25, 2020. Virgin Galactic is celebrating the second successful glide flight of its spaceship over Spaceport America in southern New Mexico. Virgin Galactic
ALBUQUERQUE, N.M. -- Virgin Galactic on Friday put off plans to make another attempt at a rocket-powered flight from New Mexico to the fringe of space, saying it needed more time for technical checks.
The space tourism venture said in a social media post that its team at Spaceport America would be working to identify the next opportunity to move the testing program along as the promise of commercial flights continues to loom.
The last attempt in December was cut short when computer trouble prevented the spaceship’s rocket from firing properly. Instead of soaring toward space, the ship and its two pilots were forced to make an immediate landing by gliding back down to the runway at the desert outpost in southern New Mexico.
Over the past week, preparations for the latest attempt included installing the rocket motor into the spacecraft and checking the operation of a feathering system that slows and stabilizes the craft as it re-enters the atmosphere.
The spacecraft also was secured to the carrier plane that will fly it to a high altitude, where it will be released so it can fire its rocket motor and make the final push to space.
The flights are designed to reach an altitude of at least 50 miles (80.5 kilometers) before the rocket motor is turned off and the crew prepares to reenter the atmosphere and glide to a landing.
Preparations for the next flight also included loading payload belonging to NASA aboard the six-passenger ship.
While the flight window for the test would have opened Saturday, Virgin Galactic has said there will be opportunities to fly throughout February pending its readiness and weather conditions. A storm system is expected to move across New Mexico this weekend, bringing with it frigid temperatures and snow in many locations.
Virgin Galactic has reached space twice before — the first time from California in December 2018. In June, Virgin Galactic marked its second successful glide flight over Spaceport America.
The company has yet to announce a firm date for its first commercial flight.
Virgin Galactic is one of a few companies looking to cash in on customers with an interest in space. Jeff Bezos’ Blue Origin company in January launched a new capsule as part of test as it aims to get its program for tourists, scientists and professional astronauts off the ground.
Virgin Galactic further delays SpaceShipTwo test flights
WASHINGTON — Virgin Galactic says it is delaying the next test flight of its SpaceShipTwo suborbital vehicle by more than two months to address technical issues, part of a revamped flight test program that will postpone flights of space tourists to 2022.
In an earnings call Feb. 25 timed to the release of its fourth quarter and full year 2020 financial results, company executives blamed an aborted test flight of SpaceShipTwo Dec. 12 on electromagnetic interference (EMI) that caused a flight computer to reboot just as the vehicle ignited its hybrid rocket engine. The vehicle glided to a safe landing at Spaceport America in New Mexico.
Mike Moses, president of Virgin Galactic, said a new flight control computer system is the likely source of increased levels of EMI. The company took steps to shield components from that interference to avoid a similar reboot and prepared to make a powered test flight as soon as Feb. 13. But in the final days of preparations, technicians noted continued EMI issues with vehicle systems.
“We saw some of our sensor readings — pressures and temperatures, those kinds of things — show some unusual fluctuations, which let us know EMI was still present and maybe in systems we didn’t initially anticipate,” he said. Now, the company is pursuing a modification to the flight control computer that is the source of the EMI.
That modification will be tested in the coming weeks both in the lab and on the vehicle itself before resuming flight tests. The company now expects that powered test flight to take place in May.
Michael Colglazier, chief executive of Virgin Galactic, said the company is sticking to the flight test program it announced last fall. The May flight will be followed by two more: one with two pilots and a “full cabin” of company employees to test the passenger cabin of the vehicle, followed by one with company founder Richard Branson on board. Colglazier said the company isn’t yet announcing specific dates for those flights, but expects both to take place this summer.
That will be followed by a flight for the Italian Air Force, confirming an agreement signed in October 2019. That flight will carry a set of research payloads and three Italian payload specialists, and generate revenue for the company. Colglazier said that flight would likely take place in late summer or early fall and generate revenue for the company, “and will conclude our product test program.”
At the same time as the company puts the current SpaceShipTwo, called VSS Unity, through its final test flights, Virgin Galactic will begin testing of its next suborbital vehicle, which the company announced will be called SpaceShip III. That class of vehicles features a “modular design” that will result in a higher flight rate and better maintainability, he said.
The first SpaceShip III vehicle will be rolled out March 30 and begin flight tests in the summer. Colglazier said that flight test program will include four glide flights and four powered test flights, with the powered flights to space producing revenue, although he did not explain in what way. Some SpaceShipTwo test flights have generated limited revenue by flying payloads through NASA’s Flight Opportunities program.
After those tests, he said there will be a “multi-month period” to make changes to the vehicle before a final glide flight and powered flight. At the same time, Virgin Galactic will “implement enhancements and accelerate some long-term maintenance updates” to the WhiteKnightTwo carrier aircraft, VMS Eve, used by both Unity and SpaceShip III. Unity will also undergo “some additional enhancements” at the same time.
That means that, starting in the fall, Virgin Galactic will stand down from either test or commercial flights for about four months, delaying the start of commercial flights of Unity. “At the conclusion of this period, we expect that VSS Unity will begin flying private astronauts and SpaceShip III will be in a position to complete its flight testing, which we expect to be in early ’22,” Colglazier said.
This latest delay appeared to alarm some analysts on the earnings call, but Colgalzier attempted to downplay the schedule slip. “I don’t think this is a big slip at all. I think we’re pushing our flight eight to nine weeks,” he said. That eight to nine weeks refers to delay from the previously scheduled Feb. 13 flight, but that flight is a repeat of a flight that was aborted in December.
Moreover, Virgin Galactic has experienced years of delays in development and testing of SpaceShipTwo: more than a decade, going back to original pronouncements by Branson when he announced the creation of Virgin Galactic in 2004 and its intent to leverage technology developed by Scaled Composites’ SpaceShipOne, the suborbital spaceplane that won the $10 million Ansari X Prize that year.
Analysts were also worried about the company’s burn rate, particularly as Colglazier announced additional projects, such as development of a fourth-generation “Delta-class” version of the spaceplane and a new carrier aircraft.
Colglazier declined to say when the company anticipated achieving break-even, but he noted the company was losing about $60 million per quarter but had $666 million of cash on hand as of the end of 2020. “We are well-capitalized,” he said.
However, Jon Campagna, Virgin Galactic’s outgoing chief financial officer, said the company would be “opportunistic about raising capital to further our strategic objectives,” similar to a secondary stock offering the company performed in 2020 that raised $441 million. Virgin Galactic announced Feb. 25 that Campagna was leaving the company at the end of the month, and that it had hired Doug Ahrens as its new chief financial officer, effective March 1.