Wheels Up Announces December Quarter and Full Year 2024 Results
Wheels Up (NYSE: UP) reported its Q4 and full-year 2024 results, showing progress in its business transformation. Q4 revenue reached $204.8M with an Adjusted EBITDA loss of $11.3M, while full-year revenue was $792.1M with a net loss of $339.6M.
The company's fleet modernization strategy is underway with 18 new Phenom jets added and 50 legacy aircraft retired in 2024. The December quarter showed the lowest Adjusted EBITDA loss since going public, with December nearly reaching breakeven. Operational metrics improved with a 98% completion rate, though 80% on-time performance faced challenges.
Key developments include John Verkamp's appointment as CFO effective March 31, and securing a new $332M revolving credit facility with Bank of America, backed by Delta. The Q4 Adjusted Contribution Margin improved to 19.3%, driven by a 33% increase in Utility.
Wheels Up (NYSE: UP) ha riportato i risultati del quarto trimestre e dell'intero anno 2024, evidenziando progressi nella trasformazione aziendale. Il fatturato del Q4 ha raggiunto i 204,8 milioni di dollari con una perdita di EBITDA rettificato di 11,3 milioni di dollari, mentre il fatturato dell'intero anno è stato di 792,1 milioni di dollari con una perdita netta di 339,6 milioni di dollari.
La strategia di modernizzazione della flotta dell'azienda è in corso, con l'aggiunta di 18 nuovi jet Phenom e il ritiro di 50 aerei legacy nel 2024. Il quarto trimestre di dicembre ha mostrato la perdita di EBITDA rettificato più bassa da quando è diventata pubblica, con dicembre che si avvicinava al pareggio. I parametri operativi sono migliorati con un tasso di completamento del 98%, anche se l'80% delle prestazioni in tempo ha affrontato delle sfide.
Tra gli sviluppi chiave vi è la nomina di John Verkamp come CFO a partire dal 31 marzo e il conseguimento di una nuova linea di credito revolving di 332 milioni di dollari con Bank of America, garantita da Delta. Il margine di contribuzione rettificato del Q4 è migliorato al 19,3%, sostenuto da un aumento del 33% nell'utilizzo.
Wheels Up (NYSE: UP) informó sus resultados del cuarto trimestre y del año completo 2024, mostrando avances en su transformación empresarial. Los ingresos del Q4 alcanzaron los 204,8 millones de dólares con una pérdida de EBITDA ajustado de 11,3 millones de dólares, mientras que los ingresos del año completo fueron de 792,1 millones de dólares con una pérdida neta de 339,6 millones de dólares.
La estrategia de modernización de la flota de la empresa está en marcha, con 18 nuevos jets Phenom añadidos y 50 aeronaves heredadas retiradas en 2024. El cuarto trimestre de diciembre mostró la pérdida de EBITDA ajustado más baja desde que salió a bolsa, con diciembre acercándose al punto de equilibrio. Los indicadores operativos mejoraron con una tasa de finalización del 98%, aunque el 80% del rendimiento a tiempo enfrentó desafíos.
Los desarrollos clave incluyen el nombramiento de John Verkamp como CFO a partir del 31 de marzo y la obtención de una nueva línea de crédito rotativa de 332 millones de dólares con Bank of America, respaldada por Delta. El margen de contribución ajustado del Q4 mejoró al 19,3%, impulsado por un aumento del 33% en la Utilidad.
Wheels Up (NYSE: UP)는 2024년 4분기 및 연간 실적을 보고하며 비즈니스 변혁의 진전을 보여주었습니다. 4분기 매출은 2억 4백만 달러에 달했으며 조정된 EBITDA 손실은 1천 130만 달러였고, 연간 매출은 7억 9천 210만 달러로 순손실은 3억 3천 960만 달러에 이릅니다.
회사의 함대 현대화 전략이 진행 중이며, 2024년에는 18대의 새로운 Phenom 제트기가 추가되고 50대의 구형 항공기가 퇴역했습니다. 12월 분기에는 상장 이후 가장 낮은 조정 EBITDA 손실을 기록했으며, 12월에는 거의 손익 분기점에 도달했습니다. 운영 지표는 98% 완료율로 개선되었지만, 80%의 정시 성과는 도전에 직면했습니다.
주요 개발 사항으로는 3월 31일자로 CFO로 John Verkamp가 임명되었고, Delta의 지원을 받는 Bank of America와 3억 3천 200만 달러의 새로운 회전 신용 시설을 확보했습니다. 4분기 조정 기여 마진은 19.3%로 개선되었으며, 이는 유틸리티의 33% 증가에 의해 주도되었습니다.
Wheels Up (NYSE: UP) a publié ses résultats du quatrième trimestre et de l'année entière 2024, montrant des progrès dans sa transformation commerciale. Les revenus du Q4 ont atteint 204,8 millions de dollars avec une perte d'EBITDA ajusté de 11,3 millions de dollars, tandis que les revenus de l'année entière s'élevaient à 792,1 millions de dollars avec une perte nette de 339,6 millions de dollars.
La stratégie de modernisation de la flotte de l'entreprise est en cours, avec l'ajout de 18 nouveaux jets Phenom et le retrait de 50 avions anciens en 2024. Le trimestre de décembre a montré la plus faible perte d'EBITDA ajusté depuis l'introduction en bourse, avec décembre atteignant presque le seuil de rentabilité. Les indicateurs opérationnels se sont améliorés avec un taux d'achèvement de 98%, bien que la performance à l'heure de 80% ait rencontré des défis.
Les développements clés incluent la nomination de John Verkamp en tant que CFO à partir du 31 mars et l'obtention d'une nouvelle ligne de crédit renouvelable de 332 millions de dollars avec Bank of America, soutenue par Delta. La marge de contribution ajustée du Q4 s'est améliorée à 19,3%, soutenue par une augmentation de 33% de l'utilisation.
Wheels Up (NYSE: UP) hat seine Ergebnisse für das vierte Quartal und das gesamte Jahr 2024 veröffentlicht und Fortschritte in seiner Geschäftstransformation aufgezeigt. Der Umsatz im Q4 erreichte 204,8 Millionen Dollar mit einem Verlust von 11,3 Millionen Dollar beim bereinigten EBITDA, während der Jahresumsatz 792,1 Millionen Dollar betrug, mit einem Nettoverlust von 339,6 Millionen Dollar.
Die Modernisierungsstrategie der Flotte des Unternehmens ist im Gange, mit 18 neuen Phenom-Jets und dem Rückzug von 50 älteren Flugzeugen im Jahr 2024. Das Dezemberquartal zeigte den niedrigsten bereinigten EBITDA-Verlust seit dem Börsengang, wobei der Dezember fast den Break-even erreichte. Die operativen Kennzahlen verbesserten sich mit einer Abschlussquote von 98%, während die pünktliche Leistung von 80% Herausforderungen gegenüberstand.
Wichtige Entwicklungen sind die Ernennung von John Verkamp zum CFO mit Wirkung zum 31. März und die Sicherstellung einer neuen revolvierenden Kreditfazilität über 332 Millionen Dollar bei der Bank of America, die von Delta unterstützt wird. Der bereinigte Beitragsmargen im Q4 verbesserte sich auf 19,3%, was durch einen Anstieg von 33% bei der Nutzung vorangetrieben wurde.
- Q4 showed lowest Adjusted EBITDA loss since going public
- Q4 Adjusted Contribution Margin improved to 19.3% (18 percentage points YoY)
- 33% increase in Utility during Q4
- Secured $332M revolving credit facility with improved terms
- Gross profit increased $34M YoY in Q4
- Full-year net loss of $339.6M
- Q4 net loss of $87.5M
- Q4 Adjusted EBITDA loss of $11.3M
- $14M non-cash loss on debt extinguishment
- $9M charge for excess parts inventory from fleet transition
Insights
Wheels Up's Q4 and full-year 2024 results demonstrate meaningful progress in their business transformation despite continued losses. The company reported Q4 revenue of
The standout metric is the dramatic margin expansion – Q4's Adjusted Contribution Margin reached
December's near-breakeven performance and the lowest quarterly Adjusted EBITDA loss since going public (
The new
While the full-year
The continued rationalization toward a standardized fleet of Phenom and Challenger aircraft should drive further efficiencies in 2025, potentially enabling the company to reach consistent profitability if current trends continue.
Financial performance illustrates momentum with business transformation
Fleet modernization underway, with 18 new Phenom jets entering Wheels Up's controlled fleet and the company's first Challengers set to enter service by April 1
John Verkamp appointed Chief Financial Officer, to join company on March 31
Commentary from Wheels Up's Chief Executive Officer, George Mattson, about the company's financial and operating results for the fourth quarter and year ended December 31, 2024 is included in an Investor Letter that can be found on Wheels Up's Investor Relations website at https://investors.wheelsup.com.
December Quarter 2024 Results
- Revenue of
$204.8 million - Adjusted Contribution of
$39.6 million - Net loss of
$87.5 million $(0.13) - Adjusted EBITDA loss of
$11.3 million
Full Year 2024 Results
- Revenue of
$792.1 million - Adjusted Contribution of
$85.7 million - Net loss of
$339.6 million $(0.49) - Adjusted EBITDA loss of
$117.9 million
"After several quarters of consistent improvement, we ended 2024 in a much stronger financial position than we began. The fourth quarter was our lowest Adjusted EBITDA loss since going public, with the month of December achieving nearly breakeven performance. This was also our first quarter of sequential revenue growth in nearly two years, thanks in part to record margins and further enhancements to operational efficiency," said Wheels Up Chief Executive Officer, George Mattson. "The combination of long-term, foundational improvements to our operation and commercial engine and the early positive signs from our fleet modernization has provided solid momentum as we enter 2025 and work toward our long-term objective of building a resilient business model with a strong balance sheet and consistent profitability."
Business highlights
- John Verkamp named new Chief Financial Officer. The company announced the appointment of John Verkamp as Chief Financial Officer, effective March 31. With a two-decade track record of financial leadership at GE and GE Vernova, including his most recent role as CFO of Gas Power Global Services, John brings a deep understanding of complex operations and will oversee the company's global finance organization.
- Higher Utility and operational efficiency driving more profitable flying. The company's top priority has been realigning its product, fleet and flying to better meet customer demand. As a result, Gross profit increased
$34 million $42 million - Transforming the Wheels Up fleet. During the quarter, the company announced its fleet modernization strategy, which we expect will result in the transition of Wheels Up's four existing jet aircraft types to two of the most preferred and successful aircraft types in the industry – Embraer's Phenom 300/300E and Bombardier's Challenger 300/350 aircraft. As part of this strategy, the company added 18 Phenom aircraft and retired 50 owned and leased legacy jets and King Air aircraft during 2024. Results for the December quarter include a non-cash
$9 million - Improving operational performance. A key component of Wheels Up's strategic growth plan is to deliver the industry's most reliable operation for our customers. During the December quarter, the company delivered a 98 percent Completion Rate and 80 percent On-Time Performance. We experienced weather, air traffic control and other uncontrollable factors during the December quarter, as well as the additional demands our operations placed on our smaller legacy fleet, that when combined challenged On-Time Performance. As the fleet rapidly transitions to a modernized and more reliable fleet, we expect to be able to drive both higher On-Time Performance and Utility.
- Industry-leading partnership with Delta. Together with Delta, we are developing first-of-their-kind global aviation solutions for Delta's corporate and premium leisure customers, combining commercial and private air travel to create a seamless and flexible aviation experience. We have continued to build on the momentum of our partnership, commercially and operationally, and are still in the early stages of realizing its full potential.
- New Revolving Credit Facility. The company closed on a five-year,
$332 million $84.3 million $14 million
Financial and Operating Highlights(1) | |||||
As of December 31, | |||||
2024 | 2023 | % Change | |||
Active Members(2) | 5,369 | 9,947 | (46) % | ||
Three Months Ended December 31, | |||||
(In thousands, except Active Users, Utility, Live Flight Legs, Private Jet Gross | 2024 | 2023 | % Change | ||
Active Users | 7,286 | 10,744 | (32) % | ||
On-Time Performance (D-60) | 80 % | 87 % | n/m | ||
Completion Rate | 98 % | 98 % | n/m | ||
Utility | 41.1 | 31.0 | 33 % | ||
Live Flight Legs | 12,731 | 14,374 | (11) % | ||
Private Jet Gross Bookings | $ 212,395 | $ 243,278 | (13) % | ||
Total Gross Bookings | $ 313,861 | $ 286,646 | 9 % | ||
Private Jet Gross Bookings per Live Flight Leg | $ 16,683 | $ 16,925 | (1) % | ||
Three Months Ended December 31, | |||||||
(In thousands, except percentages) | 2024 | 2023 | $ Change | % Change | |||
Revenue | $ 204,815 | $ 246,380 | $ (41,565) | (17) % | |||
Gross profit (loss) | $ 15,475 | $ (18,051) | $ 33,526 | n/m | |||
Adjusted Contribution | $ 39,616 | $ 2,848 | $ 36,768 | n/m | |||
Adjusted Contribution Margin | 19.3 % | 1.2 % | n/a | 18 pp | |||
Net loss | $ (87,538) | $ (81,115) | $ (6,423) | (8) % | |||
Adjusted EBITDA | $ (11,307) | $ (38,121) | $ 26,814 | 70 % | |||
Net cash provided by (used in) operating activities | $ 37,926 | $ (3,791) | $ 41,717 | n/m | |||
Twelve Months Ended December 31, | |||||||
(In thousands, except percentages) | 2024 | 2023 | $ Change | % Change | |||
Revenue | $ 792,104 | $ 1,253,317 | $ (461,213) | (37) % | |||
Gross profit (loss) | $ 2,483 | $ (37,722) | $ 40,205 | n/m | |||
Adjusted Contribution | $ 85,687 | $ 62,536 | $ 23,151 | 37 % | |||
Adjusted Contribution Margin | 10.8 % | 5.0 % | n/a | 6 pp | |||
Net loss | $ (339,635) | $ (487,387) | $ 147,752 | 30 % | |||
Adjusted EBITDA | $ (117,873) | $ (145,868) | $ 27,995 | 19 % | |||
Net cash used in operating activities | $ (77,888) | $ (665,285) | $ 587,397 | 88 % | |||
__________________ | |
(1) | For information regarding Wheels Up's use and definitions of our key operating metrics and non-GAAP financial measures, see "Definitions of Key Operating Metrics, "Definitions of Non-GAAP Financial Measures" and "Reconciliations of Non-GAAP Financial Measures" sections herein. |
(2) | Active Members as of December 31, 2024 includes the impact of the company's decision to discontinue Pay-As-You-Go and Connect membership options in July 2024. |
n/m | Not meaningful |
About Wheels Up
Wheels Up is a leading provider of on-demand private aviation in the
For more information, visit www.wheelsup.com.
Cautionary Note Regarding Forward-Looking Statements
This press release contains certain "forward-looking statements" within the meaning of the federal securities laws. Forward-looking statements provide current expectations of future circumstances or events based on certain assumptions and include any statement, projection or forecast that does not directly relate to any historical or current fact. Forward-looking statements are subject to known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside of the control of Wheels Up Experience Inc. ("Wheels Up", or "we", "us", or "our"), that could cause actual results to differ materially from the results discussed in the forward-looking statements. These forward-looking statements include, but are not limited to, statements regarding: (i) Wheels Up's growth plans, the size, demand, competition in and growth potential of the markets for Wheels Up's service offerings and the degree of market adoption of Wheels Up's member programs, charter offerings and any future services it may offer; (ii) the potential impact of Wheels Up's cost reduction and operational efficiency initiatives on its business and results of operations, including timing, magnitude and possible effects on liquidity levels and working capital; (iii) Wheels Up's fleet modernization strategy first announced in October 2024, its ability to execute such strategy on the timeline that it currently anticipates and the expected commercial, financial and operational impacts to Wheels Up; (iv) Wheels Up's liquidity, future cash flows and certain restrictions related to its indebtedness obligations, as well as its ability to perform under its contractual and indebtedness obligations; (v) Wheels Up's ability to achieve positive Adjusted EBITDA (as defined herein) in the future pursuant to the most recent schedule that it has announced; (vi) the potential impacts or benefits from pursuing strategic actions involving Wheels Up or its subsidiaries or affiliates, including, among others, acquisitions and divestitures, new debt or equity financings, refinancings of existing indebtedness, or commercial partnerships or arrangements; (vii) the expected impact and timing of certain personnel transitions; and (viii) the impacts of general economic and geopolitical conditions on Wheels Up's business and the aviation industry, including due to, among others, fluctuations in interest rates, inflation, foreign currencies, taxes, tariffs and trade policies, and consumer and business spending decisions. The words "anticipate," "believe," "can," "continue," "could," "estimate," "expect," "future," "intend," "may," "might," "plan," "possible," "potential," "predict," "project," "should," "strive," "would" and similar expressions may identify forward-looking statements, but the absence of these words does not mean that statement is not forward-looking. We have identified certain known material risk factors applicable to Wheels Up in our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the
Use of Non-GAAP Financial Measures
This press release includes certain non-GAAP financial measures, such as Adjusted EBITDA, Adjusted Contribution and Adjusted Contribution Margin. These non-GAAP financial measures are in addition to, and not a substitute for or superior to, measures of financial performance prepared in accordance with generally accepted accounting principles in
For more information on these non-GAAP financial measures, see the sections titled "Definitions of Non-GAAP Financial Measures" and "Reconciliations of Non-GAAP Financial Measures" included in this press release.
Contacts
Investors:
ir@wheelsup.com
Media:
press@wheelsup.com
WHEELS UP EXPERIENCE INC. | |||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||
(Unaudited, in thousands except share and per share data) | |||||||
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||
2024 | 2023 | 2024 | 2023 | ||||
Revenue | $ 204,815 | $ 246,380 | $ 792,104 | $ 1,253,317 | |||
Costs and expenses: | |||||||
Cost of revenue (exclusive of items shown | 176,266 | 250,925 | 733,075 | 1,232,506 | |||
Technology and development | 9,486 | 11,608 | 40,690 | 61,873 | |||
Sales and marketing | 21,371 | 17,328 | 84,317 | 88,828 | |||
General and administrative | 38,350 | 23,539 | 137,594 | 145,873 | |||
Depreciation and amortization | 13,074 | 13,506 | 56,546 | 58,533 | |||
(Gain) loss on sale of aircraft held for sale | (1,942) | (5,611) | (4,622) | (16,939) | |||
Loss on disposal of assets, net | 3,295 | — | 3,295 | — | |||
Impairment of goodwill | — | — | — | 126,200 | |||
Total costs and expenses | 259,900 | 311,295 | 1,050,895 | 1,696,874 | |||
Loss from operations | (55,085) | (64,915) | (258,791) | (443,557) | |||
Other income (expense) | |||||||
Gain (loss) on divestiture | 357 | — | 2,003 | (2,991) | |||
Loss on extinguishment of debt | (14,914) | (1,595) | (17,714) | (4,401) | |||
Change in fair value of warrant liability | (17) | 54 | (8) | 739 | |||
Interest income | 922 | 31 | 2,170 | 6,121 | |||
Interest expense | (18,089) | (14,220) | (65,352) | (41,255) | |||
Other income (expense), net | (218) | 162 | (717) | (660) | |||
Total other income (expense) | (31,959) | (15,568) | (79,618) | (42,447) | |||
Loss before income taxes | (87,044) | (80,483) | (338,409) | (486,004) | |||
Income tax benefit (expense) | (494) | (632) | (1,226) | (1,383) | |||
Net loss | (87,538) | (81,115) | (339,635) | (487,387) | |||
Less: Net loss attributable to non-controlling | — | — | — | — | |||
Net loss attributable to Wheels Up Experience | $ (87,538) | $ (81,115) | $ (339,635) | $ (487,387) | |||
Net loss per share of Common Stock | |||||||
Basic and diluted | $ (0.13) | $ (0.14) | $ (0.49) | $ (3.69) | |||
Weighted-average shares of Common Stock | |||||||
Basic and diluted | 697,836,353 | 576,426,623 | 697,713,626 | 132,194,747 | |||
WHEELS UP EXPERIENCE INC. | |||
CONSOLIDATED BALANCE SHEETS | |||
(Unaudited, in thousands, except share data) | |||
December 31, 2024 | December 31, 2023 | ||
ASSETS | |||
Current assets: | |||
Cash and cash equivalents | $ 216,426 | $ 263,909 | |
Accounts receivable, net | 32,316 | 38,237 | |
Other receivables | 1,182 | 11,528 | |
Parts and supplies inventories, net | 12,177 | 20,400 | |
Aircraft inventory | — | 1,862 | |
Aircraft held for sale | 35,663 | 30,496 | |
Prepaid expenses | 23,546 | 55,715 | |
Other current assets | 10,759 | 11,887 | |
Total current assets | 332,069 | 434,034 | |
Property and equipment, net | 348,339 | 337,714 | |
Operating lease right-of-use assets | 56,911 | 68,910 | |
Goodwill | 217,045 | 218,208 | |
Intangible assets, net | 96,904 | 117,766 | |
Restricted cash | 30,042 | 28,916 | |
Other non-current assets | 76,701 | 110,512 | |
Total assets | $ 1,158,011 | $ 1,316,060 | |
LIABILITIES AND EQUITY | |||
Current liabilities: | |||
Current maturities of long-term debt | $ 31,748 | $ 23,998 | |
Accounts payable | 29,977 | 32,973 | |
Accrued expenses | 89,484 | 102,475 | |
Deferred revenue, current | 749,432 | 723,246 | |
Operating lease liabilities, current | 13,953 | 22,869 | |
Intangible liabilities, current | 1,525 | 1,525 | |
Other current liabilities | 1,165 | 416 | |
Total current liabilities | 917,284 | 907,502 | |
Long-term debt, net | 376,308 | 235,074 | |
Deferred revenue, non-current | 180 | 983 | |
Operating lease liabilities, non-current | 50,810 | 54,956 | |
Warrant liability | 20 | 12 | |
Intangible liabilities, non-current | 9,152 | 10,677 | |
Other non-current liabilities | 485 | 6,983 | |
Total liabilities | $ 1,354,239 | $ 1,216,187 | |
Mezzanine equity: | |||
Executive performance award | 5,881 | 2,476 | |
Total mezzanine equity | 5,881 | 2,476 | |
Stockholders' equity: | |||
Common stock, | 70 | 70 | |
Additional paid-in capital | 1,921,581 | 1,879,009 | |
Accumulated deficit | (2,102,895) | (1,763,260) | |
Accumulated other comprehensive loss | (12,662) | (10,704) | |
Treasury stock, at cost, 439,451 and 275,707 shares, respectively | (8,203) | (7,718) | |
Total Wheels Up Experience Inc. stockholders' equity | (202,109) | 97,397 | |
Non-controlling interests | — | — | |
Total stockholders' equity | (202,109) | 97,397 | |
Total liabilities and equity | $ 1,158,011 | $ 1,316,060 | |
WHEELS UP EXPERIENCE INC. | |||
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||
(Unaudited, in thousands) | |||
Twelve Months Ended December 31, | |||
2024 | 2023 | ||
Cash flows from operating activities: | |||
Net loss | $ (339,635) | $ (487,387) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Depreciation and amortization | 56,546 | 58,533 | |
Amortization of deferred financing costs and debt discount | 8,711 | 329 | |
Payment in kind interest | 43,412 | 10,453 | |
Equity-based compensation | 45,977 | 25,633 | |
Change in fair value of warrant liability | 8 | (739) | |
Provision for expected credit losses | 2,728 | 1,705 | |
Reserve for excess and obsolete inventory | 12,063 | 3,923 | |
Loss on extinguishment of debt | 17,714 | 4,401 | |
Gain on sale of aircraft held for sale | (4,622) | (16,939) | |
Impairment of goodwill | — | 126,200 | |
Other | (4,796) | 4,893 | |
Changes in assets and liabilities: | |||
Accounts receivable | 2,794 | 30,062 | |
Other receivables | 4,349 | (3,164) | |
Parts and supplies inventories | 2,861 | 4,686 | |
Aircraft inventory | 1,673 | 11,010 | |
Prepaid expenses | 30,117 | (17,315) | |
Other non-current assets | 33,803 | (32,289) | |
Operating lease liabilities, net | (1,322) | (552) | |
Accounts payable | (2,882) | (8,089) | |
Accrued expenses | (11,233) | (35,110) | |
Deferred revenue | 25,383 | (348,419) | |
Other assets and liabilities | (1,537) | 2,890 | |
Net cash used in operating activities | (77,888) | (665,285) | |
Cash flows from investing activities: | |||
Purchases of property and equipment | (122,811) | (20,168) | |
Capitalized software development costs | (15,021) | (16,497) | |
Proceeds from sale of divested business | 7,894 | 13,200 | |
Purchases of aircraft held for sale | (2,408) | (4,240) | |
Proceeds from sale of aircraft held for sale, net | 85,560 | 68,308 | |
Other | 105 | 267 | |
Net cash (used in) provided by investing activities | (46,681) | 40,870 | |
Cash flows from financing activities: | |||
Purchase of shares for treasury | (485) | (28) | |
Purchase of fractional shares | — | (3) | |
Proceeds from notes payable | — | 70,000 | |
Repayment of notes payable | — | (70,000) | |
Proceeds from long-term debt | 327,201 | 382,200 | |
Repayments of long-term debt | (246,460) | (59,523) | |
Payment of debt issuance costs | (1,594) | (21,692) | |
Net cash provided by financing activities | 78,662 | 300,954 | |
Effect of exchange rate changes on cash | (450) | (3,867) | |
NET DECREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | (46,357) | (327,328) | |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH BEGINNING OF PERIOD | 292,825 | 620,153 | |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH END OF PERIOD | $ 246,468 | $ 292,825 | |
Definitions of Non-GAAP Financial Measures
Adjusted EBITDA. We calculate Adjusted EBITDA as Net income (loss) adjusted for (i) Interest income (expense), (ii) Income tax expense, (iii) Depreciation and amortization, (iv) Equity-based compensation expense, (v) Acquisition and integration related expenses and (vi) other items not indicative of our ongoing operating performance, including but not limited to, restructuring charges.
We include Adjusted EBITDA as a supplemental measure for assessing operating performance, to be used in conjunction with bonus program target achievement determinations, strategic internal planning, annual budgeting, allocating resources and making operating decisions, and to provide useful information for historical period-to-period comparisons of our business, as it removes the effect of certain non-cash expenses and other items not indicative of our ongoing operating performance.
Adjusted Contribution & Adjusted Contribution Margin. We calculate Adjusted Contribution as Gross profit (loss) excluding Depreciation and amortization and adjusted further for equity-based compensation included in Cost of revenue and other items included in Cost of revenue that are not indicative of our ongoing operating performance. Adjusted Contribution Margin is calculated by dividing Adjusted Contribution by total revenue.
We include Adjusted Contribution and Adjusted Contribution Margin as supplemental measures for assessing operating performance and for the following: to be used to understand our ability to achieve profitability over time through scale and leveraging costs; and to provide useful information for historical period-to-period comparisons of our business and to identify trends.
Definitions of Key Operating Metrics
Active Members. We define Active Members as the number of membership accounts that generated membership revenue in the applicable period and are active as of the end of the reporting period. We use Active Members to assess the adoption of our premium offerings which is a key factor in our penetration of the market in which we operate and a key driver of Membership revenue and Flight revenue.
Active Users. We define Active Users as Active Members as of the reporting date plus unique non-member customers who completed a revenue generating flight at least once in the applicable period and excluding wholesale flight activity. While a unique customer can complete multiple revenue generating flights on our platform in a given period, that unique customer is counted as only one Active User. We use Active Users to assess the adoption of our platform and frequency of transactions, which are key factors in our penetration of the markets in which we operate and our ability to generate revenue.
On-Time Performance (D-60). We define On-Time Performance (D-60) as the percentage of total flights flown that departed within 60 minutes of the scheduled time, inclusive of air traffic control, weather, maintenance and customer delays. On-Time Performance (D-60) excludes all cancelled flights and wholesale flight activity.
Completion Rate. We define Completion Rate as the percentage of total scheduled flights operated and completed. Completion Rate excludes customer-initiated flight cancellations and wholesale flight activity.
Utility. We define Utility for the applicable period as the total revenue generating flight hours flown on our controlled fleet, excluding empty repositioning legs, divided by the monthly average number of available aircraft in our controlled fleet. Utility is expressed as a monthly average. We measure the revenue generating flight hours for a given flight on our controlled aircraft as the actual flight time from takeoff to landing. We determine the number of aircraft in our controlled fleet available for revenue generating flights at the end of the applicable month and exclude aircraft then classified as held for sale. We believe Utility is a useful metric to measure the efficiency of our operations, our ability to generate a return on our assets and the impact of our fleet modernization strategy.
Live Flight Legs. We define Live Flight Legs as the number of completed one-way revenue generating private jet flight legs in the applicable period, excluding empty repositioning legs and owner legs related to aircraft under management. We believe Live Flight Legs is a useful metric to measure the scale and usage of our platform and our ability to generate Flight revenue.
Private Jet Gross Bookings & Total Gross Bookings. We define Private Jet Gross Bookings as the total gross spend by our members and customers on all private jet flight services under our member programs and charter offerings (excluding all group charter flights, which are charter flights with 15 or more passengers ("Group Charter Flights"), and cargo flight services ("Cargo Services")). We believe Private Jet Gross Bookings provides useful information about the aggregate amount our members and customers spend with Wheels Up versus our competitors.
We define Total Gross Bookings as the total gross spend by our members and customers on all private jet flight services under our member programs and charter offerings, Group Charter Flights and Cargo Services. We believe Total Gross Bookings provides useful information about the scale of the overall global aviation solutions that we provide our members and customers.
For each of Private Jet Gross Bookings and Total Gross Bookings, the total gross spend by our members and customers is the amount invoiced to the member or customer and includes the cost of the flight and related services, such as catering, ground transportation, certain taxes, fees and surcharges. We use Private Jet Gross Bookings and Total Gross Bookings to provide useful information for historical period-to-period comparisons of our business and to identify trends, including relative to our competitors. Our calculation of Private Jet Gross Bookings and Total Gross Bookings may not be comparable to similarly titled measures reported by other companies.
In Wheels Up's Annual Report on Form 10-K for the year ended December 31, 2023 and Quarterly Reports on Form 10-Q for each of the three months ended March 31, 2024 and June 30, 2024, as well as certain other earnings materials furnished in connection therewith, "Total Private Jet Flight Transaction Value" and "Total Flight Transaction Value" were presented as non-GAAP financial measures, and "Total Private Jet Flight Transaction Value per Live Flight Leg" was presented as a key operating metric. To improve the clarity of our reports filed with the SEC and to use comparable terminology to other registrants, beginning with our Quarterly Report on Form 10-Q for the three months ended September 30, 2024, we relabeled "Total Private Jet Flight Transaction Value," "Total Flight Transaction Value" and "Total Private Jet Flight Transaction Value per Live Flight Leg" as Private Jet Gross Bookings, Total Gross Bookings and Private Jet Gross Bookings per Live Flight Leg, respectively. In addition, we began presenting Private Jet Gross Bookings and Total Gross Bookings as key operating metrics given their usage. We will no longer present Private Jet Charter FTV or Other Charter FTV, which were included in such past filings.
Private Jet Gross Bookings per Live Flight Leg. We use Private Jet Gross Bookings per Live Flight Leg to measure the average gross spend by our members and customers on all private jet flight services under our member programs and charter offerings (excluding Group Charter Flights and Cargo Services) for each Live Flight Leg.
Reconciliations of Non-GAAP Financial Measures | |||||||
Adjusted EBITDA | |||||||
The following tables reconcile Adjusted EBITDA to Net loss, which is the most directly comparable GAAP measure (in thousands): | |||||||
Three Months Ended | Twelve Months Ended | ||||||
2024 | 2023 | 2024 | 2023 | ||||
Net loss | $ (87,538) | $ (81,115) | (339,635) | (487,387) | |||
Add back (deduct): | |||||||
Interest expense | 18,089 | 14,220 | 65,352 | 41,255 | |||
Interest income | (922) | (31) | (2,170) | (6,121) | |||
Income tax expense | 494 | 632 | 1,226 | 1,383 | |||
Other expense, net | 218 | 1,376 | 717 | 660 | |||
Depreciation and amortization | 13,074 | 13,506 | 56,546 | 58,533 | |||
Change in fair value of warrant liability | 17 | (54) | 8 | (739) | |||
(Gain) loss on divestiture | 1,400 | — | (2,003) | 2,991 | |||
Loss on disposal of assets, net | 1,538 | — | 3,295 | — | |||
Equity-based compensation expense | 12,613 | 3,983 | 45,977 | 25,633 | |||
Impairment of goodwill | — | — | — | 126,200 | |||
Acquisition and integration expense(1) | — | — | — | 2,108 | |||
Restructuring charges(2) | 365 | 2,749 | 7,850 | 43,655 | |||
Fleet modernization expense(3) | 28,135 | — | 28,135 | — | |||
Atlanta Member Operations Center set-up expense(4) | — | 3,673 | 3,481 | 30,568 | |||
Certificate consolidation expense(5) | 794 | 576 | 6,749 | 11,375 | |||
Other(6) | 416 | 3,901 | 6,599 | 4,018 | |||
Adjusted EBITDA | $ (11,307) | $ (38,121) | $ (117,873) | $ (145,868) | |||
__________________ | |
(1) | Consists of expenses incurred associated with acquisitions, as well as integration-related charges incurred within one year of the applicable acquisition date, which are primarily related to system conversions, re-branding costs and fees paid to external advisors. |
(2) | For the year ended December 31, 2024, primarily consists of charges for contract termination fees and employee separation programs as part of our ongoing cost reduction and strategic business initiatives. For the year ended December 31, 2023, primarily consists of restructuring charges related to the restructuring plan that we announced on March 1, 2023 (the "Restructuring Plan") and related strategic business expenses incurred to support significant changes to our member programs and certain aspects of our operations, which primarily include consultancy fees associated with designing and implementing changes to our member programs and obtaining financing, and severance and recruiting expenses associated with executive transitions and other employee separation programs as part of our cost reduction initiatives. |
(3) | Consists of expenses incurred in connection with the execution of our fleet modernization strategy first announced in October 2024, which primarily includes expenses associated with transitioning Embraer Phenom 300 series aircraft to our operations, pilot training programs aligned to our fleet modernization strategy, amounts reserved during the fourth quarter of 2024 related to existing Parts and supplies inventory deemed in excess of future business needs after considering our fleet modernization strategy and loss on debt extinguishment of |
(4) | Consists of expenses associated with establishing the Member Operations Center located in the |
(5) | Consists of expenses incurred to execute consolidation of our FAA operating certificates, which primarily includes pilot training and retention programs and consultancy fees associated with planning and implementing the consolidation process. |
(6) | Includes: (i) for both periods presented above, (a) collections of certain aged receivables which were added back to Net loss in the reconciliation presented for the year ended December 31, 2022, which for the periods presented above increase the Adjusted EBITDA loss, and (b) amounts reserved related to existing Parts and supplies inventory deemed in excess of future business needs after considering certain strategic business initiatives; (ii) for the year ended December 31, 2024, (a) reserves and/or write-offs of certain aged receivables associated with our former aircraft management business divested on September 30, 2023, and (b) expenses incurred in connection with ongoing litigation matters; and (iii) for the year ended December 31, 2023, charges related to an individually immaterial litigation settlement during the third quarter of 2023. |
Refer to "Supplemental Expense Information" below, for further information.
Adjusted Contribution and Adjusted Contribution Margin | |||||||
The following tables reconcile Adjusted Contribution to Gross profit (loss), which is the most directly comparable GAAP measure (in thousands): | |||||||
Three Months Ended | Twelve Months Ended | ||||||
2024 | 2023 | 2024 | 2023 | ||||
Revenue | $ 204,815 | $ 246,380 | $ 792,104 | ||||
Less: Cost of revenue | 176,266 | 250,925 | 733,075 | 1,232,506 | |||
Less: Depreciation and amortization | 13,074 | 13,506 | 56,546 | 58,533 | |||
Gross profit (loss) | 15,475 | (18,051) | 2,483 | (37,722) | |||
Gross margin | 7.6 % | (7.3) % | 0.3 % | (3.0) % | |||
Add back: | |||||||
Depreciation and amortization | 13,074 | 13,506 | 56,546 | 58,533 | |||
Equity-based compensation expense in cost of revenue | 131 | 830 | 2,228 | 3,927 | |||
Restructuring expense in cost of revenue(1) | 109 | — | 3,984 | 1,075 | |||
Fleet modernization expense(2) | 10,033 | — | 10,033 | — | |||
Atlanta Member Operations Center set-up expense in cost of revenue(3) | — | 2,264 | 1,860 | 24,704 | |||
Certificate consolidation expense in cost of revenue(4) | 794 | 324 | 5,297 | 8,044 | |||
Other(5) | — | 3,975 | 3,256 | 3,975 | |||
Adjusted Contribution | 39,616 | 2,848 | 85,687 | 62,536 | |||
Adjusted Contribution Margin | 19.3 % | 1.2 % | 10.8 % | 5.0 % | |||
__________________ | |
(1) | For the year ended December 31, 2024, primarily consists of charges for employee separation programs as part of our ongoing cost reduction and strategic business initiatives. For the year ended December 31, 2023, primarily consists of restructuring charges related to the Restructuring Plan and other employee separation programs as part of our cost reduction initiatives. |
(2) | Consists of expenses incurred in connection with the execution of our fleet modernization strategy first announced in October 2024, which primarily includes expenses associated with transitioning Embraer Phenom 300 series aircraft to our operations, pilot training programs aligned to our fleet modernization strategy and amounts reserved during the fourth quarter of 2024 related to existing Parts and supplies inventory deemed in excess of future business needs after considering our fleet modernization strategy. |
(3) | Consists of expenses associated with establishing the Atlanta Member Operations Center and its operations, which primarily includes redundant operating expenses during the transition period, relocation expenses for employees and costs associated with onboarding new employees. The Atlanta Member Operations Center began operating on May 15, 2023, and related expenses concluded during the second quarter of 2024, approximately one year after operations began. |
(4) | Consists of expenses incurred to execute consolidation of our FAA operating certificates, which primarily includes pilot training and retention programs and consultancy fees associated with planning and implementing the consolidation process. |
(5) | Includes amounts reserved related to existing Parts and supplies inventory deemed in excess of future business needs after considering certain strategic business initiatives. |
Supplemental Revenue Information | |||||||
(In thousands) | Three months ended | Change in | |||||
2024 | 2023 | $ | % | ||||
Membership | $ 11,483 | $ 19,077 | $ (7,594) | (40) % | |||
Flight | 163,897 | 202,374 | (38,477) | (19) % | |||
Aircraft management | 2,147 | 10,398 | (8,251) | (79) % | |||
Other | 27,288 | 14,531 | 12,757 | 88 % | |||
Total | $ 204,815 | $ 246,380 | $ (41,565) | (17) % | |||
(In thousands) | Twelve Months Ended | Change in | |||||
2024 | 2023 | $ | % | ||||
Membership | $ 57,614 | $ 82,857 | $ (25,243) | (30) % | |||
Flight | 633,865 | 884,065 | (250,200) | (28) % | |||
Aircraft management | 9,707 | 175,829 | (166,122) | (94) % | |||
Other | 90,918 | 110,566 | (19,648) | (18) % | |||
Total | $ 792,104 | $ 1,253,317 | $ (461,213) | (37) % | |||
Supplemental Expense Information | |||||
(In thousands) | Three Months Ended December 31, 2024 | ||||
Cost of | Technology | Sales and | General and | Total | |
Equity-based compensation expense | $ 131 | $ 421 | $ 233 | $ 11,828 | $ 12,613 |
Restructuring charges | 109 | — | — | 256 | 365 |
Fleet modernization expense(1) | 10,033 | — | 33 | 3,666 | 28,135 |
Certificate consolidation expense | 794 | — | — | — | 794 |
Other | — | — | — | 416 | 416 |
(In thousands) | Twelve Months Ended December 31, 2024 | ||||
Cost of | Technology | Sales and | General and | Total | |
Equity-based compensation expense | $ 2,228 | $ 1,302 | $ 661 | $ 41,786 | $ 45,977 |
Restructuring charges | 3,984 | — | 1,648 | 2,218 | 7,850 |
Fleet modernization expense(1) | 10,033 | — | 33 | 3,666 | 28,135 |
Atlanta Member Operations Center set- | 1,860 | — | — | 1,621 | 3,481 |
Certificate consolidation expense | 5,297 | — | — | 1,452 | 6,749 |
Other | 3,256 | — | — | 3,343 | 6,599 |
__________________ | |
(1) | Total Fleet modernization expense includes loss on debt extinguishment of |
(In thousands) | Three Months Ended December 31, 2023 | ||||||||
Cost of | Technology | Sales and | General and | Total | |||||
Equity-based compensation expense | $ 830 | $ 319 | $ (17) | $ 2,851 | $ 3,983 | ||||
Restructuring charges | — | — | — | 2,749 | 2,749 | ||||
Atlanta Member Operations Center set- | 2,264 | — | — | 1,409 | 3,673 | ||||
Certificate consolidation expense | 324 | — | — | 252 | 576 | ||||
Other | 3,975 | — | — | (74) | 3,901 | ||||
(In thousands) | Twelve Months Ended December 31, 2023 | ||||||||
Cost of | Technology | Sales and | General and | Total | |||||
Equity-based compensation expense | $ 3,927 | $ 2,096 | $ 1,764 | $ 17,846 | $ 25,633 | ||||
Acquisition and integration expenses | — | 53 | 134 | 1,921 | 2,108 | ||||
Restructuring charges | 1,075 | 6,940 | 2,761 | 32,879 | 43,655 | ||||
Atlanta Member Operations Center set- | 24,704 | 201 | — | 5,662 | 30,568 | ||||
Certificate consolidation expense | 8,044 | — | — | 3,332 | 11,375 | ||||
Other | 3,975 | — | — | 43 | 4,018 | ||||
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SOURCE Wheels Up
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