Vertical Aerospace .(EVTL)2022-04-28 16:00Aircraft Development and Market Potential - The company aims to complete certification of its VX4 eVTOL aircraft and commence manufacturing in 2025, with first deliveries expected in that year [461]. - The VX4 aircraft is designed to transport a pilot and up to four passengers over distances exceeding 100 miles at speeds over 200 mph, producing zero operating emissions [448]. - The urban air mobility market is projected to grow to a total addressable market size of 286 million as a result of its Business Combination with Broadstone [459]. - Revenue increased by £45 thousand, or 52%, from £87 thousand in 2020 to £132 thousand in 2021, primarily due to increased activity by VAEL [483]. - The company incurred a net loss of £245,224 thousand in 2021, compared to a net loss of £12,326 thousand in 2020, reflecting a 1,889% increase in losses [501]. - Total finance costs amounted to £32,015 thousand in 2021, a significant increase from a net finance income of £807 thousand in 2020, indicating a 4,067% change [481]. - The company expects to require approximately 130 million needed within the next 12 months for prototype aircraft development and certification [502][503]. Expenses and Cash Flow - Research and development expenses rose by £14,320 thousand, or 144%, from £9,971 thousand in 2020 to £24,291 thousand in 2021, driven by increased research and testing activities related to aircraft [487]. - Administrative expenses surged by £260,500 thousand, or 6,928%, from £3,760 thousand in 2020 to £264,260 thousand in 2021, largely due to share-based payment expenses related to the Business Combination [488]. - Other operating income increased by £9,035 thousand, or 390%, from £2,317 thousand in 2020 to £11,352 thousand in 2021, with government grants contributing £8,829 thousand and R&D tax credits totaling £2,388 thousand [490]. - Net cash used in operating activities increased by £15,538 thousand, or 130%, from £12,012 thousand in 2020 to £27,550 thousand in 2021, primarily due to increased R&D spending [517]. - Net cash used in investing activities rose by £2,666 thousand, or 387%, from £688 thousand in 2020 to £3,354 thousand in 2021, mainly due to the acquisition of intangible assets [518]. - Net cash from financing activities surged by £232,203 thousand, or 1,856%, from £12,510 thousand in 2020 to £244,713 thousand in 2021, driven by proceeds from the Business Combination and PIPE Financing [519]. Capital Requirements and Funding - Future capital requirements will depend on factors such as R&D expenses, capital expenditures for manufacturing, and general administrative expenses as operations scale [504]. - The company had cash and cash equivalents of £212,660 thousand as of December 31, 2021, indicating a need for ongoing funding to cover operating expenses and planned capital expenditures [501]. - The company issued Convertible Senior Secured Notes with an aggregate principal amount of 192,000,000, and issued 4,000,000 warrants at 1,000 principal amount [511]. - The Convertible Senior Secured Notes bear interest at 7.00% per annum if paid in cash or 9.00% if paid in-kind, with an additional 2.00% added during an event of default [513]. Internal Controls and Compliance - The company identified material weaknesses in internal control over financial reporting due to insufficient trained professionals, affecting the design and maintenance of controls [748]. - Remediation activities include hiring additional accounting staff and utilizing external specialists for complex accounting matters [750]. - The company is in the process of implementing an enterprise resource planning system to enhance internal controls over financial reporting [751]. Impact of External Factors - The company is monitoring the impact of the COVID-19 pandemic and the war in Ukraine on its operations, supply chain, and costs [454][458].