Release Date: November 04, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Eve Holding Inc (EVEX, Financial) successfully completed the assembly of their full-scale engineering prototype and initiated testing, marking significant progress in their development program.
- The company launched 'Tech Care,' an integrated service portfolio for maintenance, logistics, and training, enhancing customer support and operational efficiency.
- Eve Holding Inc (EVEX) conducted a successful five-day simulation of their air traffic coordination software, Vector, in Sao Paulo, receiving positive feedback from partners.
- The company secured $236 million in new capital since July, strengthening their liquidity position to $445 million, providing a three-year runway for cash consumption.
- Eve Holding Inc (EVEX) has a pre-order backlog of approximately 2,900 aircraft valued at $14.4 billion, indicating strong market interest and potential future revenue.
Negative Points
- The timeline for type certification has been adjusted to 2027, indicating a slight delay from previous expectations.
- The company is still in a pre-operational phase, with financials primarily reflecting development costs, resulting in a net loss of $36 million for the third quarter of 2024.
- Cash burn is expected to increase slightly in 2025, with significant investments anticipated in 2026 for the production facility.
- There is uncertainty regarding the impact of new FAA regulations on the company's aircraft development and operations.
- Despite a strong order backlog, the company has not yet converted any letters of intent into firm orders, which could impact future revenue projections.
Q & A Highlights
Q: What is driving the updated timeline for type certification to 2027, and what are the implications for revenue timing?
A: Johann Bordais, CEO, explained that the timeline reflects the complexity and innovation involved in developing the EVTOL. The focus is on delivering a mature and reliable product rather than being the first to market. The certification path includes the first flight of the engineering prototype in early 2025, followed by assembling conforming vehicles in 2026, leading to certification in 2027. Eduardo Siffert Couto, CFO, added that customer engagement remains strong, and they expect to start firming LOIs soon, which will include down payments and a PDP schedule.
Q: How should we think about the timing of CapEx for the production facility and its impact on cash burn?
A: Eduardo Siffert Couto, CFO, stated that the peak investment for the facility will occur in 2026, with some investments in 2025. The facility's financing is structured over 16 years with a four-year grace period. Cash burn is expected to increase slightly in 2025 but remain flat in 2026 compared to 2025.
Q: What are the most supportive aspects of the new FAA regulations for the EVTOL industry?
A: Luiz Valentini, CTO, highlighted the clarity provided by the final rules, which allow for training flexibility and do not require dual-command aircraft for training. This change aligns with industry requests and supports efficient pilot training programs.
Q: How is Eve Holding Inc. addressing service opportunities, and who are the potential competitors in this space?
A: Johann Bordais, CEO, emphasized Eve's comprehensive approach to services, including the TechCare platform, which offers integrated support for maintenance, logistics, and training. Eve is open to servicing competitor vehicles, focusing on ensuring high availability and optimized operating costs. The company leverages Embraer's experience to differentiate itself in the service market.
Q: What is the significance of launching the TechCare offering three years ahead of operational launch?
A: Johann Bordais, CEO, explained that early preparation is crucial for ensuring a successful entry into service. The TechCare platform is designed to provide comprehensive support, including training, maintenance, and customer care, to ensure high reliability and availability of the EVTOLs. This proactive approach aims to prevent operational disruptions and enhance customer confidence.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
