Louie DiPalma: Yes. And one more on your business prospects. The U.S. Army, at an industry conference in January announced that it is looking to multisource its vantage data analytics dashboard program, and in your prepared remarks and over the past year, you’ve discussed the success that you’ve had with the GFIM program, which is also with the U.S. Army data analytics office. And I was wondering if this vantage, multi sourcing represents an opportunity for BigBear given its strong relationship with the U.S. Army, and what other potential defense prospects you may have in your pipeline? Thanks.
Amanda Long: Sure. I think probably the best way to answer it was to maybe talk about some of the things we’re seeing as it relates to consolidation of federal contracts, right, because that I think, is, is absolutely happening. We are seeing multiple contracts consolidated into larger contract, contract infrastructures, in certain cases, which allows the government to manage properties more efficiently and streamline the work. And we are definitely having this conversation. Now we’ve seen that in other instances as it relates to kind of the general, federal market, and how we position ourselves and what we’re seeing in terms of opportunity. I think, in all three of the vectors, right, that we have strengthened, whether it’s complex global supply chain logistics, whether it’s autonomous systems like our work at IMX 23, right, whether it’s cyber right, particularly with a focus on cybersecurity and risk, right and reverse engineering.
I see our pipeline growing. I guess this is the short summary and I think it has, in no small part right to do with the fact that there is a level of geopolitical unrest that is pretty unprecedented right now and leadership that is in the seats and we are doing our best to help.
Louie DiPalma: Great. And for Julie, following the cost reduction initiatives, what should we expect for the ballpark cash burn for 2023 when taking into account the interest payments and different tax payments that you mentioned and also what is the total company liquidity pro forma for the $25 million raise?
Julie Peffer: Well, specifically to your first question, Louie. So, we, we feel like we have done a really good job of getting the piping has really helped significantly on that liquidity profile, obviously. But when we look at our cash burn with the cost reductions that we’ve taken out in starting in Q3, again, in Q4 and Q1, we do expect the cash burn to be significantly lower. Now, you’re already aware of our interest payments that do happen in second quarter and fourth quarter. And so you kind of already know where those are placed. I would tell you that, our targeting, we are targeting to be operationally cash flow positive in the second half of the year. Again, to be clear on what we mean by operational cash flow positive, we’re focused on the on-going day to day business.
So that includes, everything that would that would be normal operating expenses that you would see in the business as well as inflow of customer payments. It doesn’t include, as I said, the interest payments, which you know, where those are, or transaction fees for severance costs and things like that. We’re going to be much more positive we believe in the second half of the year. In the first half of the year just to be clear, we, I think we noticed this in our earnings release, we had some start-up costs in fourth quarter in early Q1 in advance of a contract that was awarded in late Q1. And so the timing of those customer payments is probably going to flow into Q2. And so we do think that early in the year cash is going to look a little bit worse than it will be in the back half of the year.
But we still think that we’re comfortable with our liquidity position where we are that we have plenty of liquidity to support our growth strategy and deliver on the promises we’ve made.
Louie DiPalma: Great. Thanks, Julie and thanks Mandy. That’s it for me.
Julie Peffer: Thank you, Louie.
Operator: And our next question comes from the line of Param Singh with Oppenheimer. Please proceed with your question.
Param Singh: Hi, thank you. Yes, this is Param Singh on for Ittai Kidron from Oppenheimer. So first of all, I just wanted to get a better sense of your overall revenue guide. Obviously, you have some really good successes with multiple contracts that you’ve talked about GFIM today, and, of course, IDIQ. Well not what kind of parse that and against your DACA wants to I mean, it doesn’t seem you’re embedding much growth in there. Maybe you could help me understand why that, not growing at a much faster pace? Or is there incremental conservatism baked into your guidance?
Amanda Long: So hello, first of all hi, thanks for joining. Second, so I can, I’ll make a couple of comments. And then I’ll hand it to Julie to add some color. I think when we, when we looked at kind of the year, we had in 2022, and then we looked forward into 2023. And so what we see the way that we’re approaching guidance is really to be balanced. Right. And in really establishing and sharing right, well, we have line of sight to, what we see what we think is reasonable, right, given certainly a continued challenging macroeconomic environment. But to reinforce what Julie shared, as well as what I shared earlier, that we, I think for many companies, right, ourselves included, January opened up a lot of conversations that I think we are seeing accelerate, right.
And I’ll continue to be optimistic about how those conversations will progress. But as you also know, the federal contracting process can be a long one. And while we are pushing and being extremely responsive, and adapting and extending our solutions to meet those needs, our guidance reflects what I think is a very appropriate and measured approach between 2023. Julie, anything to add on your side?
Julie Peffer: Yes, I would say yes, maybe say most of everything that I would have said, The only thing I would add is that there’s a couple of things that I would add to that was this sense of we’re trying to ensure that we don’t get ahead of ourselves. We saw some challenges last year, as we experienced on shifting and funding from various different contracts that that we had in terms of timing of how those were going to be funded, or specifically some of the funding that was reprioritized to be associated with the war in Ukraine. And so we want to make sure that what we have in our guidance is what we believe is in front of us and that we can deliver. And the only other thing I was going to just remind you guys and I think maybe said this but just to reemphasize, it’s important to understand that in the government world, even with this really heightened excitement around AI and capabilities, there’s typically three major stages that we have to go through in order to get these contracts awarded.
And there’s a prototype phase, which is small. And typically breakeven, there’s a an MVP stage, which has to prove things out. And then we get into production, that takes a long time. And so even with the excitement around everything that we’re seeing, and we’re excited about what we’re seeing, it’s just going to take a while for people to move through that process and through that curve. And so I think that’s why our guidance is where it is, we want to make sure that we’re measured about how we’re communicating and what we’re committing to and how fast we can get there.
Param Singh: That’s really helpful. Thank you so much for the caller, Mandy and Julie. Maybe if I could, on the GFIM part obviously did much better on phase 2. Phase 3, I mean, what do you expect what’s embedded in your guidance in terms of the dollar portion of the contract? Obviously, the revenue piece was much higher than you had previously anticipated? Is there now a higher output for Phase 3 as well.
Amanda Long: So it’s a fair question. And our kind of do the same as the last which is, initial, as Julie walked through in terms of thinking about phases, right. As we as we move from where we are in phase 2 and compete for phase 3, which we continue to believe we’re very well positioned for because of our execution and delivery, in the phase 2 process. Ultimately, the shift to production in, I think all example cases that we can look at means that it’s larger, right, because you’re talking about putting it into the real world doing it at scale. Now, in terms of price and — right. I think, ultimately, it’s up to the customer to make that determination and to make the award as appropriate. But I mean, Julie, definitely weigh in, because we are certainly spending a lot of time talking about it.
Julie Peffer: Yes, for sure. Yes. I mean, everything’s going very well, on the program. It was announced back in September of last year for phase 2, we’re still working toward the, toward the next phase. And again, I think we’re still looking to accelerate the deployment of the overall solution. And so we’re excited about where it’s going. But as we’ve said, they continue to refine their contracting processes and decide how fast they’re going to move down the curve, and whether they need some more, prove out during the process before they can land in a production mode. And so I think everything’s going exactly as we hoped, and maybe even better than we hoped. And I can’t I think right now that we just don’t want to over commit to how quickly they’re going to move into production, although we do believe it is calmed as part of the 2024 budget.
Param Singh: Now, that’s really helpful. Thank you so much. Maybe we could talk a little bit more about the cybersecurity opportunity. I don’t think that’s been discussed as much. So when we understand what you’re doing, and one of the new avenues of revenue that could potentially affect the upcoming years.
