10-QPeriod: Q1 FY2020

AST SpaceMobile, Inc. Quarterly Report for Q1 Ended Mar 31, 2020

Filed May 14, 2020For Securities:ASTS

Summary

New Providence Acquisition Corp. (the "Company") is a blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination. As of March 31, 2020, the Company had not yet commenced any operations and its activities were limited to its formation, initial public offering (IPO), and the identification of a potential business combination target. The Company's financial statements reflect its status as an early-stage entity with no operating revenue. Its primary assets consist of cash held outside of its trust account and marketable securities held within its trust account, which are invested in U.S. government securities. The Company's financial condition is largely dependent on its ability to successfully complete a business combination within its designated timeframe (March 31, 2021). Should a business combination not be completed, the Company is obligated to liquidate and distribute the assets in its trust account to its public stockholders. Significant risks include the uncertainty of identifying and completing a suitable business combination and the potential dilution to existing shareholders if additional shares are issued. The Company's operations are currently funded by interest income from its trust account and cash held outside of it.

Financial Statements
Beta
Operating Expenses$185K
Operating Income-$185K
Net Income$7.77M
EPS (Basic)$0.80
EPS (Diluted)$17600000.00
Shares Outstanding (Basic)8.59M

Key Highlights

  • 1The company is a blank check company (SPAC) with no operating revenues as of March 31, 2020, focused on identifying a business combination.
  • 2Total assets stood at $232.9 million, primarily comprising $232.3 million in marketable securities held in a Trust Account.
  • 3Cash balance outside the Trust Account was $519,627, intended for operational expenses and target identification.
  • 4The company reported a net income of $847,252 for the three months ended March 31, 2020, primarily driven by interest income and unrealized gains on marketable securities in the Trust Account, despite operating costs.
  • 5Total liabilities were $8.5 million, including a significant deferred underwriting fee payable of $8.05 million.
  • 6Class A common stock subject to possible redemption was $219.4 million, reflecting a substantial portion of the company's capital structure.
  • 7The company has a deadline of March 31, 2021, to complete a business combination, after which it must liquidate if unsuccessful.

Frequently Asked Questions

As of March 31, 2020, New Providence Acquisition Corp. is a blank check company (SPAC) with no operating history or revenues. Its primary objective is to identify and complete a business combination with another company.

The majority of the company's funds are held in a Trust Account, consisting primarily of marketable securities (U.S. Treasury Bills), totaling approximately $232.3 million as of March 31, 2020. An additional $519,627 in cash was held outside the Trust Account for working capital purposes.

For the three months ended March 31, 2020, the company reported a net income of $847,252. This income was generated from interest income on marketable securities held in the Trust Account ($886,099) and an unrealized gain on those securities ($371,628), which more than offset operating costs ($185,257) and a provision for income taxes ($225,218).

The primary risks include the uncertainty of successfully completing a business combination within the mandated timeframe (March 31, 2021). Failure to do so will result in liquidation and distribution of the Trust Account. There's also the risk of diluting existing shareholders if additional shares are issued and the inherent risks associated with early-stage companies.