11 - 2024 - Tamfis

Logisticsand healthcare startups to get boost from Saudi government,assistant deputy minister says

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Top Stories Tamfitronics Sustainable bond issuance surges 9%, market set to hit $950bn by year-end: Moody’s

RIYADH: Global issuance of sustainable bonds in the third quarter of 2024 reached $216 billion, marking a 9 percent annual increase, according to Moody’s.

The year-on-year increase in green, social, sustainability, and sustainability-linked bonds came despite a quarter-on-quarter drop, with the volume issued down 14 percent in the three months to the end of September compared to the preceding period.

For the first nine months of 2024, sustainable bond volumes reached $769 billion, marking a 3 percent decline compared to the same period last year.

Despite the quarterly dip, Moody’s expects total sustainable bond volumes to reach $950 billion in 2024 “buoyed by relatively robust volumes in the first half of the year and continued issuer appetite for funding environmental and social projects with labeled bonds.”

Of the $216 billion issued in the third quarter, green bonds made up the majority at $129 billion. In comparison, social bonds accounted for $37 billion, sustainability bonds for $41 billion, sustainability-linked bonds for $6 billion, and transition bonds for $3 billion.

Green bonds remained the preferred choice for most issuers, comprising 60 percent of the third-quarter sustainable bond market and accounting for 59 percent of issuance so far this year.

Although green bond issuance fell 18 percent from the previous quarter, Moody’s expected it will surpass its annual forecast: “Despite the decline in the third quarter, green bonds will likely eclipse our forecast of $580 billion given the strength of year-to-date issuance and continued issuer preference for the green label.”

Europe’s sustainable bond issuance faced notable pressure, dropping by 38 percent in the third quarter to around $80 billion, the largest regional decrease.

While the continent maintained its position as the leading region in sustainable bond issuance, accounting for 37 percent of global volumes, this marked its lowest share since early 2020.

The Asia-Pacific region showed resilience, with sustainable bond issuance totaling $60 billion, raising its global share to 28 percent — the region’s highest since the third quarter of 2023.

North America’s sustainable bond market, however, remained subdued, with volumes of just $26 billion, marking its lowest level since the second quarter of 2020.

Latin America and the Caribbean brought $12 billion to market, while the Middle East and Africa contributed nearly $5 billion, making up 8 percent of the total global sustainable bond.

Among sectors, nonfinancial companies led in sustainable bond issuance in the third quarter with a 28 percent share, or $60 billion, although this was a 26 percent drop from the previous quarter.

Financial institutions followed, contributing $48 billion to the market, marking a 12 percent increase from the prior quarter and representing the second-largest share at 22 percent.

Supranational issuers saw notable growth, issuing $33 billion, which represented a 51 percent increase quarter-over-quarter and an 80 percent rise year-over-year.

Municipal issuance, on the other hand, declined 17 percent to $13 billion, the lowest since early 2022.

Sovereign and government agency issuance also saw quarter-over-quarter declines of approximately 30 percent.

Sustainable loan volumes experienced a more pronounced decrease, falling 34 percent year-to-date to $380 billion, following two years of strong growth.

Sustainable loans averaged $127 billion per quarter over the first nine months, a notable drop from the quarterly averages of $201 billion in 2022 and $192 billion in 2023.

The third-quarter volume of $101 billion was the lowest recorded since the first quarter of 2022.

Sustainability-linked loans led the sector with $283 billion year-to-date, while green loans contributed $90 billion. In the third quarter alone, SLL volume stood at $71 billion, relatively flat from the previous quarter but down 35 percent year-over-year and 58 percent from the third quarter of 2022.

Green loan volumes in the third quarter reached $27 billion, representing a 13 percent decrease from the previous quarter and a 54 percent year-over-year decline.

Moody’s highlighted that “while the decline in market share could be driven in part by some of the challenges issuers have faced amid heightened scrutiny around the quality of instruments and perceived greenwashing risks, there may also have been a greater number of unlabeled bonds this year as issuers have sought to quickly execute transactions when market conditions were favorable.”

European borrowers continued to dominate SLL volumes in the third quarter, holding a 42 percent share, with North American borrowers at 35 percent and Asia-Pacific borrowers at 18 percent.

“European SLL volumes declined by 22 percent to $30 billion in the third quarter, their lowest quarterly tally since the third quarter of 2021,” the report said.

The analysis highlighted the role of recent biodiversity and climate COPs in spotlighting the importance of closing financing gaps in the sustainable debt market.

Biodiversity COP16 in Cali, Colombia, held at the beginning of November, emphasized mobilizing $200 billion annually for projects, including debt-for-nature swaps for high-debt nations. Though a small share of bond proceeds currently go to nature-related uses, Moody’s expected this to grow as more issuers fund biodiversity initiatives.

The upcoming climate change COP29 in Baku, Azerbaijan, due to be held from Nov. 11 to Nov. 22, is set to introduce a new finance target, replacing the current goal.

“Establishing a new climate finance goal to replace the current $100 billion target will likely be a major topic of discussion at COP29. The aim of this new quantified goal is to support developing countries in their climate action plans beyond 2025,” said Moody’s.

Emerging markets, which face higher climate risks, may see increased sustainable bond issuance, especially as the “Climate Bonds Initiative’s expansion of its taxonomy in September to facilitate greater channeling of capital to adaptation and resilience projects,” according to the report.

Former Intelsat executive joins Lynk Global as CEO

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Lynk Global envisages a total constellation of 5,000 satellites built in-house. Credit: Lynk Global

TAMPA, Fla. Ramu Potarazu, a former executive at geostationary operator Intelsat, has taken the helm of Lynk Global in the direct-to-smartphone satellite ventures latest leadership shake-up as it seeks funds to grow its constellation.

Lynk said Nov. 7 that Dan Dooley will resume his role as chief commercial officer after taking over as CEO two months ago from Charles Miller, the companys co-founder who became chairman of its board of directors.

Potarazu held various positions at Intelsat between 1991-2006, including president and chief operating officer, and was most recently CEO of media management software company EditShare.

Falls Church, Virginia-based Lynk also announced the appointment of Steven Fay as chief financial officer (CFO) to help prepare for its stock market debut by merging with Slam Corp, a publicly listed shell company led by former professional baseball player Alex Rodriguez.

Fay spent the last decade as a founding executive member and deputy CFO of OneWeb, the low Earth orbit broadband constellation owned by Eutelsat of France.

Lynk said the appointments coincide with new capital investments from shareholders but declined to disclose details.

The company has been seeking to raise a $40 million Series B funding round alongside its Slam Corp merger deal, which aims to raise at least $110 million for the constellation.

The amount Lynk would raise via Slam Corp, a special purpose acquisition company, is subject to investor redemptions that have been high for other SPAC mergers in the space industry.

Slam Corp also recently extended the deadline to close the deal by four months to Dec. 25.

Lynk currently has five small satellites in LEO, providing intermittent texting and other low-bandwidth services using radiowaves from terrestrial telco partners in the Solomon Islands, Cook Islands, Palau, and four other undisclosed countries.

The venture plans to deploy 5,000 spacecraft in total and says more satellites would improve coverage and reduce latency, enabling it to make meaningful revenues from helping telcos keep subscribers connected in dead zones.

According to Lynk, the company has secured regulatory approvals in more than 30 countries and commercial service contracts with more than 40 mobile network operators across 50 countries.

Competitors include AST SpaceMobile, which merged with a SPAC in 2021 and recently saw its shares soar following early prepayments from telcos in the United States and the deployment of its first five production satellites.

SpaceX has also deployed more than 100 Starlink satellites with direct-to-smartphone payloads and is seeking regulatory permission to provide commercial services in the United States and elsewhere.

Jason Rainbow writes about satellite telecom, finance and commercial markets for SpaceNews. He has spent more than a decade covering the global space industry as a business journalist. Previously, he was Group Editor-in-Chief for Finance Information Group,…More by Jason Rainbow

Virgin Galactic seeks to raise money to accelerate growth of spaceplane fleet

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WASHINGTON — Virgin Galactic is proposing to raise $300 million in additional capital to accelerate production of suborbital spaceplanes and a mothership aircraft the company says can fuel its long-term growth.

In a Nov. 6 earnings call to discuss the suborbital spaceflight company’s third quarter financial results, Virgin Galactic executives said that while work on the first two Delta-class spaceplanes remains on budget and schedule, they see an opportunity to raise money to add vehicles to the fleet sooner that previously planned.

“We have an exciting opportunity to captures economies of scale from our existing investments,” Michael Colglazier, chief executive of Virgin Galactic, said during the call of those plans.

The company had planned to use revenue from operations of its first two Delta-class spaceplanes, the first of which will start flying commercially in 2026, to fund development of future vehicles. But the company now says it wants to raise money to speed up work on two more Delta-class vehicles and a second mothership, allowing them to enter commercial service in 2028, two years earlier than previously projected.

“The growth capital we plan to employ will allow Virgin Galactic to deliver a second mothership and two additional spaceships much earlier than if we were to fund these ships solely through organic growth,” he said.

A second pair of spaceplanes, along with a second mothership, would result in a “fully utilized” Spaceport America in New Mexico, said Doug Ahrens, chief financial officer of Virgin Galactic. That would double the revenue over a two-spaceplane facility but quadruple earnings before interest, taxes, depreciation and amortization (EBITDA) because fixed costs are spread over more flights.

“From there, our first fully utilized spaceport becomes the economic engine that generates more than enough cash flow to expand to other spaceports around the globe,” he said, a plan the company discussed in its previous earnings call in August.

Ahrens said the company needs to raise $300 million to accelerate work on the additional spaceplanes and mothership. He didn’t disclose a schedule for raising the money other than to say the company had “flexibility” on when to raise it based on its existing cash, which is sufficient to bring the first two Delta-class vehicles into service. Virgin previously stated that having two vehicles in service would generate positive cash flow for the company.

Most of the additional capital would go towards development of a second mothership that will look similar to VMS Eve, the company’s current aircraft that has been used on SpaceShipTwo flights and will be used by the first two Delta-class vehicles. Virgin Galactic plans to begin design work on the plane in 2025, moving into production in 2026 and testing in 2027 before entering commercial service in 2028.

The company will build that plane internally, taking advantage of an engineering and production workforce that will be moving off work developing the Delta-class spaceplanes. Virgin Galactic previously contracted with Aurora Flight Sciences, a Boeing subsidiary, to produce new motherships, but that agreement fell apart and led to dueling lawsuits by Boeing and Virgin.

Virgin later dropped its suit against Boeing, electing to instead defend Boeing’s suit. According to Virgin’s Nov. 6 10-Q filing with the Securities and Exchange Commission, the companies finalized a settlement agreement Oct. 31 and Boeing’s suit was dismissed Nov. 4. The filing did not mention terms of the agreement and Virgin executives did not mention it in the earnings call.

Colglazier said that work on the first Delta-class vehicles is going well, with subcontractors Bell Textron and Qarbon Aerospace making progress on tooling and parts for the vehicles. Assembly of the first Delta-class vehicle remains on schedule to begin in the first quarter of 2025 at the company’s new facility near Phoenix, with rollout and ground tests slated for the second half of 2025.

He hinted at some issues in the development of some components that required design revisions by Virgin, working with Bell and Qarbon. “Together, we’ve been able to resequence elements within our build planning to maintain overall program momentum and delivery within our expected timelines.”

Virgin reported revenue of $402,000 in the third quarter and a net loss of $74.5 million. The company ended the quarter with $744 million of cash and equivalents on hand.

Jeff Foust writes about space policy, commercial space, and related topics for SpaceNews.He earned a Ph.D. in planetary sciences from the Massachusetts Institute of Technology and a bachelor’s degree with honors in geophysics and planetary science…More by Jeff Foust

SpaceX plans next Starship flight for mid-November

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WASHINGTON — SpaceX has scheduled its next Starship test flight for as soon as Nov. 18, making incremental changes since the previous flight in October.

The company announced Nov. 6 that it was planning the sixth integrated Starship/Super Heavy flight from its Starbase facility at Boca Chica, Texas, for the afternoon of Nov. 18. The announcement coincided with the release of airspace restrictions for the flight attempt by the Federal Aviation Administration.

SpaceX described the upcoming flight as one intended to “expand the envelope on ship and booster capabilities and get closer to bringing reuse of the entire system online.” The flight will follow a similar suborbital profile as the previous flight Oct. 13, including an attempt to return the Super Heavy booster to the launch site for a “catch” by the launch tower.

Among the changes for this flight will be a relight of a Raptor engine on Starship while in flight to demonstrate the ability to perform a deorbit burn on future orbital missions. SpaceX had planned a similar test on the vehicle’s third flight in March, but did not attempt it because of the vehicle’s roll rates.

SpaceX plans to test changes on the thermal protection system on Starship. “The flight test will assess new secondary thermal protection materials and will have entire sections of heat shield tiles removed on either side of the ship in locations being studied for catch-enabling hardware on future vehicles,” the company stated. SpaceX plans to eventually recover Starship using the same launch tower “catch” technique used for the Super heavy booster.

Starship will also fly at a higher angle of attack during its final descent, “purposefully stressing the limits of flap control to gain data on future landing profiles.”

To assist in those reentry observations, SpaceX is changing the launch time for this mission. While previous launches have occurred in the morning at Starbase, this flight is scheduled for launch in a 30-minute window that opens at 5 p.m. Eastern. Doing so will mean Starship’s splashdown will take place in daylight hours in the Indian Ocean, rather than at night as was the case previously.

SpaceX is tweaking the Super Heavy booster as well. The company said it is incorporating additional redundancy in the booster’s propulsion system, increasing structural strength in unspecified “key areas” and decreasing the time to remove propellants from the booster after its return. Engineers “also updated software controls and commit criteria for the booster’s launch and return.”

In a brief audio recording posted by SpaceX Chief Executive Elon Musk Oct. 25, SpaceX officials could be heard saying they came within one second of aborting the previous Super Heavy catch because of a “misconfigured” parameter associated with the Raptor engines in the booster. They noted that the catch attempt included “a whole bunch of new aborts and commit criteria” that they had not been able to fully doublecheck before the launch, adding that they had since reviewed the data from that flight and determined what they needed to change.

If the upcoming flight keeps its current schedule, it will mark the fastest turnaround between Starship/Super Heavy test flights at just over five weeks. One reason SpaceX can move so quickly is that the FAA license issued in October for the fifth flight also allowed SpaceX to perform a sixth flight.

“The SpaceX Starship/Super Heavy Flight 5 license authorization also includes FAA approval of the Flight 6 mission profile,” the agency stated in its announcement of the Flight 5 license Oct. 12. “The FAA determined the changes requested by SpaceX for Flight 6 are within the scope of what has been previously analyzed.” The FAA, at that time, did not disclose what changes SpaceX had requested.