Operational Pause, Furloughs Announced by Virgin Orbit

Virgin Orbit announced late last week that it was entering into an operational pause and furloughing most of its staff as it seeks new investors.

"There can be no assurance that these discussions will result in any transaction."

Virgin Orbit SEC Filing Statement.

In an SEC filing, the company said that it was implementing the operational pause in order to conserve capital while the Company conducts discussions with potential funding sources and explores strategic opportunities. "There can be no assurance that these discussions will result in any transaction. The Company does not currently intend to disclose further developments with respect to these discussions, unless and until its Board of Directors approves a specific transaction or other course of action requiring disclosure. The Company currently expects the operational pause to continue through March 21, 2023," the filing stated.

The furloughs are unpaid, according to media reports.

Operational Pause Follows UK Launch Failure

Virgin Orbit recently suffered a setback in its program when its first launch from the UK failed to reach orbit. An investigation revealed that, according to telemetry data from the company's LauncherOne rocket, from the beginning of the second stage first burn, a fuel filter within the fuel feedline had been dislodged from its normal position. Additional data shows that the fuel pump that is downstream of the filter operated at a degraded efficiency level, resulting in the Newton 4 engine being starved for fuel. Performing in this anomalous manner resulted in the engine operating at a significantly higher than rated engine temperature.

Components downstream and in the vicinity of the abnormally hot engine eventually malfunctioned, causing the second stage thrust to terminate prematurely. The early thrust termination ended the mission, and the second stage and its payloads fell back to Earth, landing in the approved safety corridor in the Atlantic Ocean.

Virgin Orbit said at the time of the launch failure that it was not pausing its operations, and that it intended to resume its launch schedule.

Virgin Orbit's stock price fell precipitously last week, and as of this (Monday) morning was trading at $.65 per share, down over 9 percent from the previous close.

(Source: SEC Filing, Media and File Reports. Images from file)