GomSpace Group (GOMX) Status Update summary

Market environment and strategic response

• Heightened global threats and recent geopolitical developments have led to increased European defense budgets and urgent additional spending, driving demand for rapid delivery of space-based intelligence and surveillance solutions.

• The company is accelerating investments in inventory, business development, and defense-related solutions, including R&D, cybersecurity, SIGINT/electronic warfare, marine domain awareness, and ISR concepts.

• Focus areas include reducing time to market, improving supply chain resilience, and increasing inventory readiness.

• Strengthening the balance sheet is a priority to support government contracts and ensure financial health.

• The company is preparing for a surge in government and defense opportunities across Europe, not just in Denmark, and is ramping up business development and solution management.

Capital injection and share issue details

• A directed share issue of 28 million new shares at SEK 7 each will raise SEK 196 million, increasing the main investor Peter Hargreaves' stake from just under 30% to just over 41%.

• Surpassing 30% ownership triggers a mandatory offer to all shareholders, which is a legal formality with the offer price set by the average market price at closing; shareholders are not obliged to accept.

• The capital will be used for inventory, business development, and maintaining a strong balance sheet for government business.

• Hargreaves is described as a long-term, supportive investor with no intention of a hostile takeover or rapid share sale.

• Hargreaves is also the main investor in Goonhilly, a UK ground station service provider.

Financial guidance and outlook

• Revenue guidance for 2025 remains unchanged at SEK 320–380 million, representing 25–48% growth over 2024, with a target of positive free cash flow and EBITDA expected between -2% and +10%.

• About 70% of forecasted revenue is already in backlog, with expected high double-digit growth in North America and low double-digit growth in product business units.

• No changes to guidance are planned at this stage, despite the dynamic market environment.

• Positive free cash flow is projected for FY 2025; strong order intake in 2H24 with larger prepayments may negatively impact 1H25 cash flow, with correction anticipated in 2H25.

• Investments are planned in digitalization and AI implementation to improve efficiency and reliability.