Welcome to today's presentation, where we have the pleasure to present GomSpace. Today's topic, of course, the Q1 2026 interim report, fresh from the press this morning. As always, we are joined by you, CEO Carsten Drachmann, to take us through your results and of course answer questions in the end. There's a box down below your screen when you're watching this presentation here, you can ask questions. There has already come a lot in, and we have a fixed time point. Look whether the question has already been answered. For now, I will hand the call or the scene to you, Carsten, and then I will rejoin when we come to the Q&A session.
Thank you, Michael, and welcome all to this first quarter presentation. Exciting. Back again. Spring is here. We started a new year and finished quite well last year and we're off to a good start. I thought, actually, I'd start with repeating a bit the strategic outlook that I see, because it's also telling a story about where we're heading and it's telling a story about why we made the changes that we've done to the organization. First of all, space is here to stay. GomSpace is right in the middle. If you look into why is space so important right now? Why is it growing? One area is space is the new defense front line.
There's absolutely no doubt about it. This is a change that has come over the last couple of years. It is really driving our business and is setting the foundation also for how we're thinking and how we are structuring ourself. Governments are shifting from from services to sovereign assets, basically having control of the assets that you need in order to secure your country. We'll talk more about Ukraine later in this presentation. It's a good example of that. We're enabling end-to-end solutions to create value. Really important that we don't only offer a satellite, a technology. We're offering an end-to-end solution that is adding value to the customer. Growth is driven more and more by our growth by multi-year constellations. We should start to see larger deals coming in.
We have seen it, and we will see more coming into the future. There's no doubt also that you will see larger constellations coming. Deep space and lunar missions are also evolving. We have already an a satellite flying out to an asteroid that we launched a couple of years ago. It's still flying, and it's still alive. Lunar missions are coming. We are engaging into a lunar mission with Blue Origin. It's Jeff Bezos' investment company. It's out in the news also. We have the first deal of that. A part of that contract is here, and we are working on the second part, and we are executing that out of Luxembourg. We see more and more also deep space and lunar missions. There will be an increasing share of product revenue.
You will also see that in the structure that we have set up, that we see our product business will grow into the products and subsystems. Volume capability and ability to scale is a differentiating factor. You have to be able to have the production facilities. You need to be able to scale your operation, both in terms of producing of components and assembling satellites. This is a competitive edge that you need to have. Obviously, for us to grow, it means we need to be able to do more. It's sort of a given, but we need to do more of that. We'll see a roll-up and consolidation. As I said before, the business is growing. Everybody understands that space is an industry that is growing, and there are many people starting up.
There are many new companies starting out. Everybody will be surviving, we'll see a roll-up trend also coming. Some companies buying other companies. If you read the news, you'll see every day. It's happening actually every week. There will be more of that. That's the baseline. Let's jump into. There's 14%, 40.2% compound average growth. This is the prediction over the next five years that the overall market growth for satellites up to 500 kilos. That's the market we are in. We definitely wanna grow much more than that is also our ambition. Into Q1 highlights. First of all, our revenue compared to first quarter last year went up with 43%.
It's very good, up to about SEK 125 million . I'm very happy with that. Our EBITDA in absolute numbers also increased compared to first quarter last year, and we're keeping about a 9% EBITDA margin. This is good. This is where we want to be. Industry is around that level. Nobody's higher. A lot of the industry is not even making a positive EBITDA, very happy with be able to deliver a growth with a profit. Negative free cash flow. This is related to that we are investing more. I saw the questions on, you hired more people. What's your plan?
Well, we're hiring more people to grow, to build more technology, to increase our ability to scale, to increase our ability to capture more business in the market, and it's also costing some markets, some money. As expected, a negative free cash flow. We have secured a further facility. We took EUR 7 million from the Hargreaves loan facility that we have. We did that simply to make sure that we want to, we want to have more than ample cash in order to execute our plans, which we're doing right now. Our cash balance is at a very solid, very strong SEK 226 million. Small note on the bottom, net profit is a positive SEK 20 million. This is actually a first time as well.
It's very nice. There is a SEK 13 million part of that which is related to shares that we have received from the company that owes us a lot of money. They owe us about SEK 150 million. It's been going on for some time. We have taken actions to have collateral. That collateral is also triggering penalty payments on their side in terms of shares for us. Right now, that's accumulated to SEK 13 million, and as this continues until they pay, we will see more shares with a value. That's why you see a fairly high net profit there. Further to this, it is a very interesting company. We strongly believe in the business case they're doing. They're raising capital, and we control assets, et cetera.
We've done everything that we can to secure that it is going to be fine, and I'm sure they will raise the capital when needed. It's a super interesting company, and it's a business case that the world needs. I'm comfortable and confident about that. Structuring for growth. We made some changes. We announced it last year. We have Last year we had three business units, now we have four plus one, I call it. Five engines of profitable growth. This is related to the market outlook, the strategic outlook that we have. The first one is products. Mentioned that before. It's all the bits and pieces inside the satellites, the subsystems. That continues to be a business unit as last year.
The one that was called programs are converted into what we call satellite systems, which are really focusing on building high volume satellites. We need to talk about standardization. We need to just talk about optimizing for volume. We have our national and defense solutions, which are targeting very much governments and also for civil purposes, dual-use purposes, building end-to-end solutions for customers. Ukraine is an example of that. We have our advanced missions, where we're doing lunar missions. Just mentioned a contract with Blue Origin that we're working on right now. We also signed some other contracts during the quarter with ESA. This is where we see new innovation is coming in here. We have our plus one, which is North America.
North America is selling all the technology solutions from across the other business units. Because North America is for the industry, the biggest market in the world, about 60%-70%, we have a special focus on that. All of these business units are driven as mini P&Ls, and we're also reporting on that. I hope you appreciate the transparency we're giving you. You can follow what each business unit is doing in terms of revenue and EBITDA, and this is also how we follow up internally when making decisions. I wanted to give you a little bit more insight into the drivers behind this. If you take products, call it an industrial scale engine. Revenue is driven by high volume sales of standardized subsystems.
This is very much about repeat production of the same systems. Volume is higher here because we have many smaller components that we are selling to more than 200 customers around the world. Profit is driven by our efficiency, our supply chain ability to scale the supply chain, repeatable production. We have really a chance to optimize here. High volume and then strong margin, and we can control the margin even better by managing this. The free cash flow is very much driven by inventory turnover and low capital intensity. We don't have a lot of capital tied up in addition to inventory. This is how we drive this.
It's also very important for us to say we do it because we're addressing a market, but we also very well understand how we're gonna make money on this. We have our satellite systems, constellation execution engine, as we call it. As we are expecting to get larger and larger orders into the future, we are focusing more and more on our ability to actually drive these programs over multi-years. They need to be efficient. The profit, the margin we get out of that is driven by repeatability, ability to also scale in the assembly and execution excellence. Here you can see when you look into the numbers, you see actually quite high EBITDA on products and a relatively low EBITDA on satellite systems. There's a good reason for that.
It is because this is where we need to scale it in order to get the margin. What we've also done here is that Satellite Systems is actually buying from our product business. That means part of the revenue that we get from Satellite Systems, we're actually passing over and part of the margin as well. This is a very clean. This is how we execute in the market, and this is how we also compare ourselves to our competitors. We have National and Defense Solutions. This is also by multi-year mission-critical contracts, sovereign customers. This is more than selling a satellite or a piece of technology. This is truly end-to-end solutions. Profit is more driven by value-based pricing.
There's gonna be a lot about program governance and risk management in this, but it's very much about value pricing. It's not what is the cost of the satellite, it is what do I get when I have launched a full system, including satellites, and what is the value to me? This is a very interesting space to be in, and we are now perfecting that. You saw, probably you noticed there's no revenue yet. No, there's not. There will come, and this is why we are driving it. Give you a few examples of what goes into this. One would be Indonesia as an example, and we also have Ukraine that we'll talk about later, falls into this category here.
Typically, cash flow is good here, free cash flow, because you can negotiate advanced payments, et cetera. This is a predictable payment plan, often with perhaps with export guarantees, et cetera, behind it. Good business for us here and definitely an area for growth. Advanced missions are contract-based. Here it's more about securing strategic projects right now. They will be fairly complex. There will be some reuse, there's also gonna be a lot of new activities. The one that we do right now with Blue Origin is a lunar mission. We're gonna have two satellites, orbiting around the moon. That requires a new development, we are learning from that. Profit is driven by ability to execute.
It's gonna be more heavy on the engineering side and less heavy on the assembly side, which means, it's high-value engineering that we need to make our money on here, so we have to be quite selective in terms of what we picked in order to make money. It's milestone-based delivery for high-value projects, so cash flow is. We should be able to secure a positive free cash flow here. Advanced mission is also an example some of you have heard perhaps about VLEO, very low Earth orbit, so when the satellites come even closer to Earth and start having some issues with gravity, but you have advantage that they are closer.
This will also fall inside of advanced missions. We did sign a contract with ESA in a consortium to start looking into this. A good example of this is our innovation and capability building engine. We still want to make money. That's what we're focused on. North America, market expansion, biggest market, repeating myself. It's about driving regional pipeline conversion on local customer engagements. It can be products, it can be individual satellites, it can be solution programs, it can be pretty much anything from our portfolio. Here, it's more about entering the market and positioning GomSpace. Profit is driven by scaling our commercial presence, leveraging the facilities and capabilities of the other business units. Okay, that gives you an idea. Five business units, four plus one.
They all have a very distinct focus in the market, something they need to achieve. They're all somewhat different. Now we define it so that we're also trading internally, so products are actually getting paid for the products they're selling to the other business units, as an example. Now, with that in mind, let's take a look at our EBITDA here. EBITDA came in at just above SEK 11 million, so that's 9%. More than the first quarter, a little bit less than first quarter last year, a little bit less than the previous quarter, Q4 here. Perfectly within range of what we are driving for. If you break it down, as mentioned earlier, a lot of the margin you can see lies in products. It is a good business.
Now that we've actually added, that we have internal trading as well, what you see here is a real margin, that if products have sold at a very high discount externally, then this would be what they have. Satellite systems are basically buying at a big discount, if you like, in order to deliver their program. This is a result. The product business is a very good business. We need to scale it. Satellite systems, relatively low margin here, needs to go up. As I said, how do we do that? Obviously, by having more contracts. It's also done by having higher repeatability. We are very focused on optimizing our assembly. We are also investing. There are some questions from you about what you're gonna spend the money on.
Well, we're investing in making more and more standardized platforms, so we can make better margin and deliver faster, and then also improve the EBITDA here. National Defense Solutions, we don't have any revenue yet, so this is reflecting this is what it's costing us right now to run that organization. Advanced Mission, just about breaking even because they do have a project that we are running right now. Actually, we have a couple of projects that's more or less paying for the team that we have sitting there, which is about eight, 10 people right now. North America, first quarter has been a bit slow. We're still living on income from last year. We do not have an ambition for high EBITDA. I've said that before.
If you can break even, it's fine. What I'm focused on is building presence. We keep hiring in North America. We get more people coming in. We're very cautious about picking the right people. We have some great new hires that have started recently. North America is not about creating a high profit right now. It's about capturing the market and getting a top line, then we'll start making money over time. That's a breakdown. Again, I hope you appreciate that you can see the details here. You can start following this. This is also linking to the market dynamics. Order intake, well above where we were first quarter last year. Order intake a little bit lower than the revenue, so the net outcome. Apologize for the picture here.
We'll make this better for presentation later on. The net somewhere we have this is that the order backlog dropped a little bit, SEK 10 million-SEK 20 million. It's fine. We of course expect to see more order intake later in the year to recover that and to continue to have an increasing order backlog. Just to highlight a couple of the key orders that we got. We had a SEK 60 million from Unseenlabs, our fantastic, wonderful customer, for two more microsatellites. Again, a confirmation of GomSpace is in microsats as well. We are starting to sit on that market, and we're definitely continuing with our good customer in France here. This is great. This is now a continuation.
Another measure is, it's good to have repeat customers, and you have repeat revenue, top, but we also want to have new customers. In addition to, it's a great contract value, SEK 80 million. It's a new customer, Virtual Labs in Italy, are buying four satellites from us for signal intelligence. New customer, always great welcoming new customers, and I'm sure I'm looking forward to working very closely with Virtual Labs and also building their business. We do see that there is possibility beyond this. A great tick in the box, new customer in a fold here. Outlook for 2026. No change. Revenue in SEK 550-SEK 650 we expect. A midpoint is about 30% growth, double up of the market.
We are expecting to keep the profitability in a 5%-12% range. Right now, we hit 9%, so that's well in the middle. Free cash flow will be negative, repeating here. We do more investments than we've done in a long time into development, to R&D, both in our product portfolio, creating standard platforms to assemble, investing and ability to scale, also gearing up for production. We're investing in testing facilities. Those of you who live up here go by can see there's been a lot of digging. We've set up some long-needed facilities to be able to test faster and better. This is essential for us to capture the market, to be able to scale, to be able to handle the volumes coming in.
Also further to this, we have the flexibility for different opportunities as they come along. We need working capital available, also we have to have the possibility to jump into opportunities when they are there. Ukraine is one example of that. Let's jump to Ukraine. You will perhaps be annoyed with me. I'll give you the facts that I can give you. There's a lot, some of you have been reading in the news, there's a lot of postings and rumors. I'll give you the facts as they are right now, I'll let the rest be for other people's speculation. What is happening right now is that Ukraine wants to have their own independent space capabilities.
That is number one, and this is what you need to really focus on and understand. This is coming. This is what I predicted some time ago and saying individual nations wants to have their own space capabilities. Ukraine, for very good, very sad reasons, are obviously first in line to do this. What have you done so far? On April 22, we have announced we signed a partnership agreement with a company called STETMAN, with Dmytro from Ukraine to build this Ukraine sovereign space capability or satellite capability. This was done at an EU summit with the European Commission, a so-called DG NEAR, who is focused on developing business towards the East. This is great. There was a lot of attendance. European Investment Bank was there.
Our Danish IFU was there. This was under EU, an EU conference driving this and an EU conference with the focus on how can we do more for Ukraine, with Ukraine, and in Ukraine. It's a joint venture that we'll sign soon. That's the next step in the second quarter here. Now we have signed a partnership agreement. We want to do this. Now we need to do a joint venture, which is an actual company that we'll set up in Ukraine with an ownership structure that we are defining right now, and we will also put some capital into that joint venture to get started. What is the scope? I know everybody wants to know, "Hey, what's the order intake? What do you expect?
How sweet it's gonna be? Right now, the focus is driving advanced space capabilities, independent space capabilities for Ukraine. It would be a communication network, satellite communication network, much like Starlink. We are right now in a phase where we're gonna investigate how much is needed. There's an ambition to cover the majority of Ukraine. It's for dual-use purposes. Right now we are going into what's gonna look like this network. We understand how it needs to be used and why, now we need to build it up. When I know more, I will tell you more. Support from EU and EU Commission is really important. This program will partly be funded. There's gonna be funds coming from the EU Commission and from EU towards Ukraine for this.
It's a very strong funding partner. It doesn't mean that the whole thing is gonna be paid, but it means that there's a strong willingness to put money into this, which is definitely required. What are next steps? Well, first of all, once we sign the joint venture, which we will do, we believe it in second quarter here, we're gonna launch one satellite, call it a test satellite, if you like, that is gonna fly over Ukraine. We'll start to doing different kind of measures and trying to understand what do we need, how do we create the sufficient coverage, where are the challenging areas that we need to be aware of. We'll be working on the scope.
You can do a little bit the math yourself that we need to cover all of Ukraine. It's probably more than one satellite. It's probably a lot more than one satellite. Now we need to understand how much more and what it contains. There's a small mark at the end in bold saying the another next step, what we're doing right now, as we're speaking, is to getting the necessary financing in place. It will be a financial framework of money coming from from EU in shapes of loans, guarantees, probably some money from from Ukraine itself, money from private investors. While we are building the necessary technical network, defining the network, we are also in parallel building the different financial and partnership structures that are required to take this off the ground.
This is by no means a simple project. It's a complex project, but it is absolutely worthwhile. It's right in our strategy, and this is driven by National Defense Solutions business unit here. In summary, taking you to the end here. Last year, great. We made, we had a positive profit. We had more than 70% growth last year. I would say sort of validates our business model. We are very happy with the business unit structure we have chosen, and it shows that by managing this tightly, we can make money, which we did in 2025, and we created growth. We're expecting more growth into to 2026 using the same mechanisms, and I just explained to you for each business unit how we intend to scale it and how we intend to make money.
For the quarter here, revenue up 43%, EBITDA at 9%, great. Net profit of SEK 20 million. I explained that. We have an extra income by receiving shares as compensation. Cash, negative free cash flow, we did expect that, but we have a very strong cash balance. We took in SEK 70 million in addition to what we had, we're sitting quite comfortably here in terms of cash. Main events, Ukraine, we talked about that. Unseenlabs with SEK 60 million. It's a good contract. Order parties for two more microsats. Great. We love that. Also a contract with a new customer in Italy, Super, and SEK 80 million. We have four plus one new business units that you will be following.
I hope we gave good information in the trading statement so you can follow it. I'm sure that during the year we'll keep talking about it and you'll start seeing why it makes sense. Also, I think it gives you a lot of information for you as investors to understand how we operate. With that, thank you very much.
Carsten, let's jump into the question. As always, a lot of questions, I'll try and group it. Let's stay a little bit on Ukraine. I only think you gave us a lot of information. Should I understand it that you're partly owner of the joint venture, so that will kind of be the military part, that cashflow stream, and then you will also sell satellites into it. Is that how we should understand how maybe this model will work for GomSpace?
Yeah, let's make it as simpler saying this is the first step towards creating this satellite communication capability.
Yeah.
We're doing a joint venture in Ukraine with a partnership structure that we're defining right now. After that comes more, but right now we are setting that up so we can deliver this. One of the key things is, and in order to get the funding from EU as well, we need to have a presence in Ukraine, which we'd love to have for this program and potentially for other things. First step is to set up a joint venture, get a company registered in Ukraine with our partner, and then based on that, there are gonna be some next steps following that.
Can you give us a kind of a feel what normally in a land size of Ukraine would be a constellation covering that? Or am I asking you something you will shake your head to?
I will, No, I will repeat what I said before. This is a satellite communication network. Obviously, it needs to cover all of Ukraine. We are understanding, trying to understand now the requirements. How do we create coverage? What's the capacity? How many users? That will define how many satellites are required.
As I said. It's probably more than one.
Yeah.
With Ukraine.
We'll take that. Then about the partner, STETMAN, any thoughts about the choosing here, the capabilities here? There's a question here around the, surrounding that.
Yeah, no, STETMAN is a great partner because he is today doing so-called ruggedized terminals also for the frontline in Ukraine. That could be laptops or phones, sat phones, et cetera, that he's ruggedizing and that he can sell it and distribute them out into the field, basically. He has a very good relationship with the MOD down there, with the military. We have been talking with him for quite some time now, more than a year. Now we're coming to the stage where we say there's actually a need, there is a willingness from Ukraine, and there's a clear expression we want to do this. EU is supporting this. Now things are starting to come together.
STETMAN is a great partner for us and have exactly the network that we need in Ukraine.
Let's jump to Indonesia. We will do this as always. Any changes to scope, contract, length? I know the answer, but I will ask that anyway, Carsten.
The scope, the lengths, the contract size.
No.
Any news regarding Indonesia there?
Yeah. No, no news is good news, right? We are in regular contact out there. Our partner Lift Projects are, they have an office there, so they are there all the time. We continue working and, yeah, no news is good news. I'll tell you if something major is changing, but the case is still there. The case is still alive.
It's gonna take a long time, short time, I'm not even gonna guess. What I can say is that Indonesia will buy satellites, that's for sure. Like Ukraine is moving, like other nations are moving, Indonesia is gonna move as well, and they are also in the process right now of understanding actually through also our engagement with them, saying, "What is what is this capability that we're building? Why do we need it as a nation?" They understand that quite well now.
There's a little bit of question surrounding your employees. Here stated 11 new employees. Can you give a feel on how many you are going to hire this year, and maybe also whether you are good at retaining those employees you are hiring?
Well, we're gonna hire as few as possible, 'cause I'm not in a business of hiring, but we do need competent people because we are growing. The recruitments we are doing is based on needs. There is a need for, let's call it the operational part, where we are generating revenue and EBITDAs for our programs. It's our production facilities. We need people there. We're also hiring a lot of people for so-called CapEx, so the investment side. More R&D, more people to build to be able to scale. It's sort of twofold. We are hiring with the revenue growth is one thing, and then we're also hiring more people for the investment part.
Sure.
Yeah, that's. We will stop hiring when we don't need it anymore. Right now we need more people.
There's also a question on the cash outflow and that you have used your facility, this SEK 75 million. What the money has gone to? I think you kind of alluded to it, working capital investments. You said you broke ground to some testing facilities, employees. Is there more to kind of elaborate there, what, why you have taken the facility and what the money has been used for?
I wanted to have a strong position so I can act and act fast. You have to be quite agile in this market. I also want to take you back to what I have talked about earlier. The industry is growing. There is more and more demand. Everybody's scaling up. I can tell you that people are looking for cash, and you can if you read the news, many of you are doing Google or ChatGPT, et cetera, there's a lot of money flowing into our competitors as well. It's very clear that everybody's gearing up and investing, and so will we. We have to.
I could probably run this business for profitability for a period of time, but if you don't invest, if you don't renew ourself, if you don't prepare for scaling, we will not be able to capture that train where we are right now standing in, in front. We are running the train, and if we stop investing, if we don't do anything, we would be behind. It's a very clear reason for why we are having the cash flow and why we're taking in this extra cash.
Then, there's a question, there's some questions regarding exactly this point here. There's one here stating that you are maybe walking a little bit away from profitability instead of growth. I don't agree. You are walking into scaling up and investing heavily. There are some questions out here. Do you need more capital injections? I know you will of course not give us a clear answer, but, yeah, people are a little bit worried about whether you need more capital to kind of follow your plans through scaling up and maybe focusing on growth instead of profitability. Any general comments to that?
Let's take the question a little bit in a different place. It is because, as I said before, it's an industry that's growing. Space is part of defense. Defense is growing. Look at the budgets for Europe right now. You look at for Denmark alone, we went from 2% to, I think, 4.5%, almost 5% right now. EU is spending more money than they have ever done before. U.S. is spending more money. Space is defense. You are investing in an industry with a growing market. The way I look at it is that it's a pie that's growing, and we want to capture a bigger part of that pie than we are right now.
We will grow with that. Really the way to look at it is to say, "How do we make GomSpace even bigger, even more profitable?" That, and that's what we are looking at. I think that is a better way to look at it. Don't have fears. Look at what do we need to do in order to grow it. That's my job to make sure that you as investors are truly benefit fitting, especially those who've been here for a long time. Thank you. I am reading. I can see some people say they are, have been made rich on GomSpace. I'm very happy for you if that's the case.
Of course, you require capital along the way, and that's also why we took the loan facility from Hargreaves, which is great to have, so we can keep this momentum going.
I know you are now joining a lot of conferences, you know, space is As you said, IPOs are coming. There's a lot of private investment going into this space. What are your feel that out there if you needed cash, are investors willing to that? I guess SpaceX here will even jump this attention into here. Kind of your feel when you are talking to investors maybe more than customers, the willingness to kind of fund this journey there. Is that out there?
Yes. For sure. Let's take a couple of things that's happening. You mentioned Starlink as an example. SpaceX going IPO are the rumors, right? Holy cow. That's a big one, right?
That's gonna create even more interest in the market. Anybody who's lying just behind Starlink, which we in principle all are because they are so big, would benefit from that as well. Another example, you can Google HawkEye 360. HawkEye 360 is doing signal intelligence surveillance, much like Unseenlabs. We actually provided half of that technology in the early days. You can go back and find press releases. HawkEye 360, when the Americans realized this is really absolute key to have, they said, "Maybe we can't buy the technology from Denmark. We have to do it ourselves." It's too bad for GomSpace, showing well how important this technology is. HawkEye 360 has filed for IPO in New York, I believe. You could go into Google. It's all public information.
We've delivered half of their technology. They have a little bit more. They're a service-oriented company, so they have a slightly higher revenue than us. Look, go look at the initial IPO value. It's about, it's above $2 billion. Holy cow, right. Yes, there's a lot of interest. I was in Washington, four weeks ago. I spoke with several bankers that came over, and funny enough, Wake Up, Wake Up Nordic, they know very well who we are in the U.S., and they know very well the journey we are on, and they're commending us and saying, "You guys have done a great job. You've taken something that should be successful. It wasn't as much, but now you're truly making money, and not many are." There's a lot of interest also from the U.S. market.
I have no, for the first time, I tell people I've been raising capital and running these types of companies for 15 years. For the first time, investors are calling. Not that I have anything to sell to them other than I say, "Go, go on the market and buy it." It's a very different situation now.
Perfect. Maybe a little bit because we will not get around, there are some more direct questions on this debt talk. You have taken in the collateral, but there's a question here. When do we expect the money? Q1, like Q2, Q3? I know you probably can't give us an answer, but I guess it also ties into the willingness because I guess they are also seeking cash in the markets. I don't know how much you can say. You can probably don't give us a timeline.
No.
The feel about this customer owing you money.
Yeah. It's first of all, I wanna repeat, truly believe in their business case. They're also are raising the capital. It's taken longer. Sometimes it takes time. It's okay. We have a very good relationship with them. We truly believe in what they're doing. I see a great need for that. The technology that they have, are buying from us has been quite important for them in the early stages also of raising capital. We have done everything we need to secure it. We have collateral to cover this. We control the assets, so we haven't sent anything to them yet until they pay, and we have a great relationship. How long time it takes, I don't know.
Things take time in this market. I think you should tie it back to the story I just said. There's a lot of capital going into space now, more than ever before. There might be some delay in the triggering from government saying, "Now we wanna do this. We're increasing the budget," so it ripples all the way out, and the investments are coming. The investments will follow contracts, and our own prime minister say, "Køb, køb, køb. Buy, buy, buy." She wasn't leaving. Well, maybe she is. We'll see where, how it ends up. That it takes a little time before it ripples through. The same goes with investments.
Once you have the contract, you'll get the money.
So, so. As I expected, no, you can't give us a timeline, but you're very confident on this one. Yes.
Yeah.
We will keep getting these questions because, as you said, we are talking about scaling up and so on. Yeah, I need to ask it to you. I know you can't answer it, but I'm really being asked.
Don't ask it, Michael.
Can you promise that, or can you give an indication on if you are raising capital, that it will not be as a big block, but be preferred as before private investors? Now I have asked it to you, Carsten. I know you can't answer it, but I was really asked here by the audience to ask that.
Okay. Let's go back and say that We've done a great first quarter. We have delivered a significant growth. We delivered a positive profit, which means our operational cash flow is positive.
I've told you that we are investing into the company to grow with the industry. The industry is growing 14% year- on- year. There's huge investments going in also to competitors. We have two big IPOs coming up in New York. Everything is going in the right direction, and I think that's what you need to focus on.
Perfect. I asked it at least. There's a little bit of questions regarding some of the specific orders. Let's jump to the Danish one. We also need to have that. Have the Danish government finally seen the light and are starting to be more granular on this observation. Greenland, I get the Baltic Sea and so on. Any comments on the Danish government?
Well, right now we don't have one. I guess that's the first comment. Things won't move until we have one. At least the one that's sitting can't decide anything. We continue to talk in Denmark, of course, and we have contacts with all the right people. Right now there's some slowdown due to the change in government. We'll see how quickly they sort out that out. If you look across the board, without going into politics, what's interesting is that I think all the parties in the parliament right now agree on investing in defense and national security is something we're going to do. There's no political difference on that.
We should expect whatever government comes out, that trend continues, and the story about buy, buy continues. That's what I'm expecting, and of course we are heavily engaged. Of course. That's our job.
Perfect. I will jump into some of the orders, you know. There's whether you can give an update on the project with 18 satellites. The two whether you can clarify the two extra satellites. I think you addressed this order as a, you know, as something you sold to a big disruptor in the European tech space. 18 satellites, was there two on top of that coming in? A little bit about the execution on this order, how that is going, because I think that was kind of a show order, showing that you actually needed to scale up, right?
Yeah. We've been on track with that one. Maybe answering the two additional. It was not two additional. It was an extension of the contract by reworking and adding more to the contract value, but it was the same amount of satellites in total.
There's a little bit questions regarding the M&A strategy. Do we have any Is this organically, as you said, it's an evolving space. There will be consolidations. There will be not deconsolidation. There will be consolidation in this industry. Any thoughts about having an M&A strategy, or is the organic strategy enough for you for now?
Yeah. Well, that would be consolidation. A consolation is another thing.
Yeah. Sorry, consolidation.
That's when you buy GomSpace shares and it goes up, then that's a consolation. No, but there will be roll-up, as I said. You see if you go look in the news, there are acquisitions happening right now. Rocket Lab have bought a company in Germany called Mynaric, which doing laser communication. This is happening. What I tell you, I'll happy to repeat it, is that we are here to stay. We are here to grow. We have come to a situation now where we have grown our top line very well. We have done that profitably. Remember when I set out three years ago saying, "Okay, we need to figure out how do we make free cash flow, positive cash flow?
How do we grow the top line, and how do we become profitable? We felt we owe that to our investors to show we can do that. This is what we've done now. This is what I meant by the validation in 2025. The structure we have, we understand how to execute, and we can deliver on all parameters. Now we are moving into a growth stage, and in order to grow, you can go different routes. You, of course, grow organically, you get more contracts. Things are moving fast, you might want to complement with some technology where it doesn't pay off for us to develop it ourselves.
There might be other reasons for entering into market where you say, "But you can do it, organically," meaning you hire people, you do something there, or you partner, or you acquire something. Our strategy is to grow. I've told you that. We're gonna grow out, outgrow, definitely outperform the market, and there are different routes to that. Of course we are considering all the options in our strategy. We should. That is my job to do that on your behalf.
Now it's my job to ask a follow-up question that do you see any holes in your technology? I think you are kind of very broad-based with products and everything, but is there blindside any holes in your technology set up, production set up? I don't know whether you want to answer that. I will ask anyway.
No. Yeah, no, no. We are, as I say, scaling is something that's important. We have 18 satellites from last year, which has helped us scale our assembly, but also the production of individual bits and pieces we've started outsourcing. This is part of it. Of course, as business cases evolve, as use cases evolve, there can be different technologies that come in addition that is, we don't yet have. That can well be. Of course, we are evolving the platform we have. We have a very strong heritage. Don't forget that the flight heritage is important. You can introduce something new, but it doesn't have flight heritage. That's a different story.
We are constantly evolving upon the platform that we've already over many years secured and said, "Listen, it works." We have flown it many times, and the customers love it, and we have the quality that they're looking for. Will there be holes over time? Probably. I see more as opportunities than holes, of course.
Perfect. And then t he final question to round off because we have, we are actually at the time, I will ask. You know, defense ETFs, space ETFs, are companies joining and if they might doing anything actively. You know, that's very important for investors because we know a big money flow will automatically go in there, and thereby of course, automatically flow to your company. Anything on the ETF space, you know, where you are joining defense or the space ETFs. Are you trying to do that, and have you succeeded in that?
Well, now it's not really something that we do. It's not for us to do. It's for the ETF to select us. I think you did see that we were selected by a U.S. based ETF that where GomSpace together with three others was on their list. That has happened. I don't look at it as something I focus on specifically, but I think what we need to do is we continue to deliver the performance. The market knows. The U.S. market knows it even better than the European market that we are performing well. By delivering on that and delivering on the value for you as investors and our continuous success, we are bound to get into more ETF.
It's not a specific target. You can also take a look at, you know, I shouldn't talk about share price and market cap, but nevertheless, you look at the market cap we have right now. You're sort of moving in a different category. We talked before the call here, Michael, about small cap, mid cap, where are we actually.
Yes.
We're sort of moving out of a small cap to a mid cap, but that's opening up something else.
Sure.
There are a lot of investment funds out there that are saying they don't get out of bed for investments in less than 100 million. Okay. Oh, wait a second. We are more than $100 million, that is. The dynamic is changing. It's not something we are pursuing specifically. I think my job is to make sure that we continue to deliver with a strong strategy, strong execution, and through that, all those good things will come also to benefit investors.
The ETF will also, due to the market cap going up, actually start potentially choosing you. That is, I know you can't actually drive that, but that is Not a side effect, a side benefit.
Of course.
your market share. Perfect.
Yeah.
Carsten, I have already taken one minute over, two minutes over, the allotted time. I will let you go now. Thank you for taking us through the results and willingness to answer questions, and thank you for the audience listening.
Thank you very much. Always a pleasure. Thank you.