Volato Reports First Quarter 2024 Results
Volato Group, a leading private aviation company and the largest HondaJet operator in the US, reported its Q1 2024 results. Total revenue was $13.2 million, with aircraft usage revenue rising 72% to $11.5 million. However, total revenue decreased 16% due to no aircraft deliveries. The net loss increased by 131% to $17.4 million, with an adjusted EBITDA loss of $13.1 million.
The company grew flight hours by 39% and improved blended yield by 8% YoY. Volato also secured $14.5 million in new financing and is implementing cost-saving measures to reduce SG&A expenses by $3 million per quarter. Despite OEM delivery delays, the company expects to receive 10-12 new aircraft in FY 2024 and forecasts positive gross margin and EBITDA by Q4 2024.
- Grew flight hours by 39% YoY.
- Blended yield increased by 8% YoY.
- Secured $14.5 million in new financing.
- Anticipates delivery of 10-12 new aircraft in FY 2024.
- Reduced SG&A expenses by $3 million per quarter.
- First cash-positive month for Vaunt in March 2024.
- Expected revenue of over $120 million from fractional sales in 2024.
- Forecasts positive gross margin and EBITDA by Q4 2024.
- Total revenue decreased by 16% YoY.
- Net loss increased by 131% to $17.4 million.
- Adjusted EBITDA loss of $13.1 million.
- No aircraft deliveries in Q1 2024.
- Managed aircraft revenue decreased by 48% YoY.
- Faced OEM aircraft delivery delays impacting revenue.
Insights
Volato's Q1 2024 financial results reveal a mixed bag of outcomes. On the positive side, the company reported a 72% year-over-year growth in aircraft usage revenue, driven by an increase in flight hours and improvements in blended yield. This indicates strong demand and operational efficiency, which are positive signs for future revenue growth.
However, there are significant financial headwinds. The company reported a substantial net loss of
The company has taken steps to address these issues, including new financing and cost-saving measures. The new financing of
In the short term, investors should remain cautious given the high net loss and significant operational challenges. Long-term prospects depend on the successful execution of cost-saving measures and the timely delivery of new aircraft, which are expected to provide immediate cash benefits and support growth.
From a market perspective, Volato's performance shows a mixed set of signals. The 39% increase in flight hours and 8% growth in blended yield reflect strong demand in the private aviation market, especially for non-owner flights which now make up 50% of flight hours. This shift indicates a successful strategy in targeting higher-yielding market segments, which is essential for improving margins.
However, the 16% decline in total revenue due to no aircraft deliveries in Q1 is a red flag. This points to supply chain issues that could have long-term impacts if not resolved. Additionally, the company's reliance on future aircraft deliveries to generate cash and fuel growth adds an element of risk, especially given the well-documented OEM supply chain challenges.
The company's new financing and cost-saving measures are steps in the right direction but also highlight liquidity concerns. The subscription platform Vaunt's first cash-positive month is a promising development, indicating potential for scalable revenue streams beyond traditional aircraft sales and usage.
For retail investors, the key takeaways are the strong market demand and the company's strategic positioning in higher-yield segments. However, the financial losses and dependency on aircraft deliveries introduce significant risk factors that must be weighed carefully.
Volato's Q1 2024 report highlights both operational successes and industry challenges. The company's achievement of a 50% demand mix of owner and non-owner flights shows an effective strategy in tapping into different market segments. The expansion of the floating fleet to 26 aircraft and the increase in light jet market share to 2.5% also underline its growing footprint in the private aviation sector.
The anticipated delivery of 10-12 new aircraft in FY 2024, including Gulfstream G280s and HondaJets, is important for future growth. However, delays in OEM aircraft deliveries present a significant bottleneck. These delays have already impacted revenue and could continue to pose risks to the company's growth plans.
The emphasis on cost-saving measures, projected to save
For stakeholders, the main considerations are the company's ability to navigate supply chain challenges and execute its growth strategy effectively. The positive market demand indicators are encouraging, but the financial losses and dependency on future deliveries add layers of complexity that need careful evaluation.
Announces
Grew Flight Hours
Expect Delivery of 10-12 New Aircraft in FY 2024
First Quarter 2024 Financial Highlights
-
Total revenue was
$13.2 million -
Aircraft usage revenue was
$11.5 million -
Managed services revenue was
$1.7 million
-
Aircraft usage revenue was
-
Net loss was
$17.4 million $0.2 million -
Adjusted EBITDA1 was a loss of
$13.1 million
[1] Adjusted EBITDA is a non-GAAP measure. Please refer to the tables and related notes in this press release for a reconciliation and definition of non-GAAP financial measures. |
Financial and Operational Highlights
-
Grew flight hours
39% and blended yield8% year-over-year in the first quarter of 2024 -
Achieved demand mix of
50% owner and50% program & ad hoc in the first quarter, reflecting strong demand and contributing to blended yield - Announced first cash-positive month for Vaunt in March 2024, Volato’s subscription platform for connecting travelers to empty leg private flights
-
Subsequent to quarter end, signed a term sheet for
$14.5 million $13.0 million $1.5 million - Company is evaluating additional sources of liquidity to support working capital and growth ahead of expected aircraft deliveries in 2024
-
Implemented cost-saving measures to reduce SG&A spend by approximately
$3 million
Company Commentary
Matt Liotta, Co-Founder and Chief Executive Officer of Volato, commented, “While OEM aircraft delivery delays put pressure on our revenue in the first quarter, we achieved strong year-over-year growth across our key metrics as we executed on our strategy to drive more favorable demand mix and higher yield per flight hour. We had a strong April for blended yield, and we expect to deliver year-over-year growth again in Q2. Secular trends in private aviation, along with Volato’s unparalleled flying experience and value proposition for owners, provide us with good forward visibility into demand for both fractional sales and jet card program as well as ad hoc. Given the well-known OEM supply chain challenges which have pushed back delivery dates, we continue to expect the delivery of 8 to 10 HondaJets but now expect delivery of two Gulfstream G280s in 2024. These deliveries, including 2-3 HondaJets which we are scheduled to receive in the second quarter, will provide us with an immediate cash benefit as we execute on our backlog of fractional sales.”
Mark Heinen, Chief Financial Officer, commented, “Following another quarter of strong operating results, we took steps to strengthen our balance sheet with a modestly sized financing to provide us with additional liquidity for working capital and to accelerate our fleet growth as we await the delivery of our HondaJets and Gulfstream G280s this year. Our aircraft deliveries in 2024 will provide additional cash as well as more capacity to grow our network and better leverage our cost base. With an expected revenue of over
Key Metrics
(financial metrics in thousands, except KPIs)
|
Three Months Ended |
|
|
|
March 31, 2024 |
March 31, 2023 |
Change YoY |
Financial Metrics: |
|||
Revenue: |
|
|
|
Aircraft sales |
- |
5,710 |
(100)% |
Aircraft Usage |
11,516 |
6,704 |
|
Managed aircraft |
1,695 |
3,271 |
(48)% |
Total Revenue |
13,211 |
15,685 |
(16)% |
Net Loss |
(17,390) |
(7,515) |
|
Adjusted EBITDA |
(13,095) |
(6,683) |
|
|
|
|
|
Key Performance Indicators (KPIs): |
|
|
|
Total Flight Hours |
2,926 |
2,103 |
+ |
Empty Percentage |
|
|
-6.1 pp |
Demand Mix |
|
|
|
Owner |
|
|
-5 pp |
Non-Owner |
|
|
+5 pp |
Blended Yield |
|
|
+ |
Floating Fleet |
26 |
15 |
+11 |
Light Jet Market Share |
|
|
+0.8 pp |
Net Promoter Score |
82 |
86 |
-4 |
First Quarter 2024 Financial Summary
Total revenue for the first quarter decreased
Net Loss for the first quarter increased
The growth in our floating fleet contributed to an increase in first quarter 2024 flight hours of
Demand mix continues to improve with
Balance Sheet and Liquidity
The Company ended the first quarter 2024 with
The company implemented cost-saving measures to reduce SG&A expenses by approximately
With the anticipated closing of the financing, forecasted aircraft sales, and the cost-saving measures, the Company believes that it will have sufficient cash to achieve profitability.
Conference Call
Volato will host a conference call to discuss its First Quarter 2024 results at 8:00 AM ET on Wednesday, May 15, 2024.
Interested parties can access the conference call by dialing (866) 605-1830 for toll free access or +1 (215) 268-9881. The live call will also be available via webcast on Volato’s Investor Relations website: https://ir.flyvolato.com/.
A replay of the call will be available until August 14, 2024, and can be accessed by dialing (877) 660-6853 or (201) 612-7415 and using the Access ID: 13746297.
About Volato
Volato (NYSE American: SOAR) is a leader in private aviation, redefining air travel through modern, efficient, and customer-designed solutions. Volato provides a fresh approach to fractional ownership, aircraft management, jet card, deposit and charter programs, all powered by advanced, proprietary mission control technology. Volato's fractional programs uniquely offer flexible hours and a revenue share for owners across the world’s largest fleet of HondaJets, which are optimized for missions of up to four passengers. For more information visit www.flyvolato.com.
All Volato Part 135 charter flights are operated by its DOT/FAA-authorized air carrier subsidiary (G C Aviation, Inc. d/b/a Volato) or by an approved vendor air carrier.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the securities laws. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words or variation of words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," "projects," "forecasts," "targets," "would," "will," "should," "goal," "could" or "may" or other similar expressions. Forward-looking statements provide management or the Board’s current expectations or predictions of future conditions, events, or results. All statements that address operating performance, events, or developments that may occur in the future are forward-looking statements, including statements regarding the challenges associated with executing our growth strategy, including expected deliveries of aircraft and related sales, and developing, marketing and consistently delivering high-quality services that meet customer expectations. All forward-looking statements speak only as of the date they are made and reflect the Company’s good faith beliefs, assumptions, and expectations, but they are not guarantees of future performance or events. Furthermore, Volato disclaims any obligation to publicly update or revise any forward-looking statement, except as required by law. By their nature, forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. Factors that might cause such differences include, but are not limited to, a variety of economic, competitive, and regulatory factors, many of which are beyond Volato’s control, that are described in Volato’s periodic reports filed with the SEC including its Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2023, and other factors that Volato may describe from time to time in other filings with the SEC. You should understand that it is not possible to predict or identify all such factors and, consequently, you should not consider any such list to be a complete set of all potential risks or uncertainties.
VOLATO GROUP, INC. |
|||||||
CONSOLIDATED BALANCE SHEETS |
|||||||
(Amounts in thousands, except par value amounts) |
|||||||
|
March 31, 2024
|
|
December 31,
|
||||
ASSETS |
|
|
|
||||
Current assets: |
|
|
|
||||
Cash |
$ |
6,442 |
|
|
$ |
14,486 |
|
Restricted cash |
|
1,845 |
|
|
|
— |
|
Accounts receivable, net |
|
2,446 |
|
|
|
2,990 |
|
Deposits |
|
25,200 |
|
|
|
25,125 |
|
Prepaid expenses and other current assets |
|
3,624 |
|
|
|
3,897 |
|
Total current assets |
|
39,557 |
|
|
|
46,498 |
|
|
|
|
|
||||
Property and equipment, net |
|
837 |
|
|
|
846 |
|
Operating lease, right-of-use assets |
|
1,198 |
|
|
|
1,278 |
|
Equity-method investment |
|
158 |
|
|
|
154 |
|
Deposits |
|
21,656 |
|
|
|
15,691 |
|
Forward purchase agreement |
|
2,755 |
|
|
|
2,982 |
|
Restricted cash |
|
— |
|
|
|
2,237 |
|
Intangibles, net |
|
1,376 |
|
|
|
1,391 |
|
Goodwill |
|
635 |
|
|
|
635 |
|
Total assets |
$ |
68,172 |
|
|
$ |
71,712 |
|
|
|
|
|
||||
LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
|
|
||||
Current liabilities: |
|
|
|
||||
Accounts payable and accrued liabilities |
$ |
10,898 |
|
|
$ |
8,588 |
|
Loan from related party |
|
1,000 |
|
|
|
1,000 |
|
Operating lease liability |
|
338 |
|
|
|
326 |
|
Merger transaction costs payable in shares |
|
— |
|
|
|
4,250 |
|
Credit facility and other loans |
|
20,007 |
|
|
|
20,616 |
|
Customer deposits and deferred revenue |
|
19,029 |
|
|
|
12,857 |
|
Total current liabilities |
|
51,272 |
|
|
|
47,637 |
|
|
|
|
|
||||
Deferred income tax liability |
|
305 |
|
|
|
305 |
|
Operating lease liability, non-current |
|
875 |
|
|
|
965 |
|
Credit facility, non-current |
|
14,026 |
|
|
|
8,054 |
|
Total liabilities |
$ |
66,478 |
|
|
$ |
56,961 |
|
COMMITMENTS AND CONTINGENCIES |
|
|
|
||||
|
|
|
|
||||
Shareholders’ equity: |
|
|
|
||||
Common Stock Class A, |
|
3 |
|
|
|
3 |
|
Additional paid-in capital |
|
82,743 |
|
|
|
78,410 |
|
Accumulated deficit |
|
(81,052 |
) |
|
|
(63,662 |
) |
Total shareholders’ equity |
|
1,694 |
|
|
|
14,751 |
|
Total liabilities and shareholders’ equity |
$ |
68,172 |
|
|
$ |
71,712 |
|
VOLATO GROUP, INC. |
|||||||
CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||
(Amounts in thousands, except share and per share data) |
|||||||
(unaudited) |
|||||||
|
For the Three Months Ended
|
||||||
|
2024 |
|
2023 |
||||
Revenue |
$ |
13,211 |
|
|
$ |
15,665 |
|
|
|
|
|
||||
Costs and expenses: |
|
|
|
||||
Cost of revenue |
|
17,492 |
|
|
|
17,363 |
|
Selling, general and administrative |
|
11,742 |
|
|
|
6,215 |
|
Total costs and expenses |
|
29,234 |
|
|
|
23,578 |
|
|
|
|
|
||||
Loss from operations |
|
(16,023 |
) |
|
|
(7,913 |
) |
|
|
|
|
||||
Other income (expenses): |
|
|
|
||||
Gain from sale of consolidated entity |
|
— |
|
|
|
387 |
|
Gain from sale of equity-method investment |
|
— |
|
|
|
863 |
|
Other income |
|
4 |
|
|
|
42 |
|
Loss from change in fair value forward purchase agreement |
|
(227 |
) |
|
|
— |
|
Interest expense, net |
|
(1,138 |
) |
|
|
(894 |
) |
Other expenses |
|
(1,361 |
) |
|
|
398 |
|
|
|
|
|
||||
Loss before provision for income taxes |
|
(17,384 |
) |
|
|
(7,515 |
) |
Provision for incomes taxes |
|
6 |
|
|
|
— |
|
Net Loss |
$ |
(17,390 |
) |
|
$ |
(7,515 |
) |
|
|
|
|
||||
Basic and diluted net loss per share |
$ |
(0.60 |
) |
|
$ |
(0.67 |
) |
|
|
|
|
||||
Weighted average common share outstanding: |
|
|
|
||||
Basic and diluted |
29,116,201 |
11,268,877 |
|
||||
Adjusted EBITDA
We calculate Adjusted EBITDA as net loss adjusted for (i) interest expense, net, (ii) provision for income taxes (benefit) (iii) depreciation and amortization, (iv) equity-based compensation expense, (v) acquisition, integration, and capital raise related expenses, and (vi) other items not indicative of our ongoing operating performance. We include Adjusted EBITDA as a supplemental measure for assessing operating performance.
The following tables reconcile Adjusted EBITDA to net loss, which is the most directly comparable GAAP measure (in thousands):
|
Three Months Ended March 31, |
||||||
Adjusted EBITDA |
2024 |
|
2023 |
||||
Net loss |
$ |
(17,390 |
) |
|
$ |
(7,512 |
) |
Interest expense, net |
|
1,138 |
|
|
|
894 |
|
Provision for income tax expense |
|
6 |
|
|
|
— |
|
Loss from change in fair value of forward purchase agreement |
|
227 |
|
|
|
— |
|
Depreciation and amortization |
|
80 |
|
|
|
45 |
|
Equity-based compensation expense |
|
83 |
|
|
|
8 |
|
Gain from sale of consolidated entity |
|
— |
|
|
|
(387 |
) |
Gain from sale of equity-method investment |
|
— |
|
|
|
(863 |
) |
Other income |
|
(4 |
) |
|
|
(42 |
) |
Other items not indicative of our ongoing operating performance(1) |
|
2,765 |
|
|
|
1,174 |
|
Adjusted EBITDA |
$ |
(13,095 |
) |
|
$ |
(6,683 |
) |
|
|
|
|
||||
|
|
|
|
||||
(1) Represents cost incurred related to the cost savings initiative and business realignment. |
|||||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20240514269337/en/
For Media:
media@flyvolato.com
For Investors:
investors@flyvolato.com
Source: Volato Group, Inc.
FAQ
What were Volato's Q1 2024 total revenues?
How much did Volato's aircraft usage revenue grow in Q1 2024?
What was Volato's net loss in Q1 2024?
How much new financing did Volato secure?
How many new aircraft does Volato expect to deliver in FY 2024?
What was Volato's blended yield growth in Q1 2024?
What cost-saving measures did Volato implement?
What financial outcome does Volato forecast for Q4 2024?
