Bridger Aerospace Group Q1 2024 Earnings Call Transcript

Quartr
Provided by Quartr
May 13, 2024

There are 3 speakers on the call.

Operator

Greetings, and welcome to the Bridger Aerospace First Quarter Fiscal 2024 Investor Conference Call. As a reminder, today's call is being recorded. It is now my pleasure to introduce your host, Mr. Eric Jaret, Chief Financial Officer. Mr.

Operator

Jaret, you may begin.

Speaker 1

Good afternoon, and thank you for joining us today. Joining me on the call this afternoon is Chief Executive Officer, Founder and Director, Tim Sheehy. Before we begin, please note that certain statements contained in this conference call that do not describe historical facts are forward looking statements as defined in the Private Securities Litigation Reform Act of 1995. Since forward looking statements are based on various assumptions, risks and uncertainties, actual results may differ materially from those expressed or implied by such statements. Factors that could cause results to differ materially from those expressed include, but are not limited to, those disclosed in the company's filings with the Securities and Exchange Commission, including expectations regarding financial results for 2024.

Speaker 1

Management cannot control or predict many factors that ultimately impact future results. Listeners should not place undue reliance on forward looking statements, which reflect management's views only as of today. We anticipate that subsequent events and developments will cause our assessments to change. However, we undertake no obligation to revise or update any forward looking statement or to make any other forward looking statement. Throughout this afternoon's earnings release and our call today, we refer to the non GAAP financial measure of adjusted EBITDA.

Speaker 1

The definition calculation and a reconciliation to the financial statements of adjusted EBITDA can be found in Exhibit A of our earnings release, which is available on our website. We believe adjusted EBITDA is useful in evaluating our reported results as a supplement to and not a substitute for the reported results under GAAP. With that, I'd like to turn the call over to Tim.

Speaker 2

Thanks, Eric. Afternoon and thanks for joining the call today. Our Q1, while the most capital intensive, is critical to allow us to finish winter maintenance on our fleet and complete flight training and agency carding that we are ready to mobilize when the North American wildfire season begins historically in late May early June. Each fire season has its own complexity and regional fluctuations, while last year we saw a late start due to heavy snowpack and the slowest wildfire season in 20 years. This year with the dry and arid weather in Oklahoma and Texas, we experienced the earliest seasonal deployment in company history with many predicting a more active 2024 fire season.

Speaker 2

In February, we deployed 1 of our Pilatus PC-twelve multi mission aircraft or MMA to Oklahoma to provide aerial intelligence for early season wildfires with a second PC-twelve deployed in April. Our MMA program, a critical component of incident planning, decision making and tactical firefighting leverages the architecture of our proprietary data Department Interior and Bureau of Indian Affairs and both remain on task orders today.

Speaker 1

In early March, we received

Speaker 2

a task order for 2 CL-415 EAF Super Scoopers aircraft from the U. S. Forest Service at the request of the state of Texas, which is battling the largest wildfire in state history. This is the earliest season deployment of our Scoopers in history in our history. Our SCOOPERS were deployed in Texas for 6 weeks before recently returning to Montana.

Speaker 2

This early wildfire activity and operational activity led to the highest Q1 revenue in our company history at 5 point $5,000,000 Looking at 2024, early indications for the U. S. Without due to drier and warmer conditions, the 2024 wildfire season should be very active, continuing the overall trend of larger wildfires and longer fire seasons, driving continued long term demand for our aerial surveillance and suppression services. An important part of our strategy is to offset fluctuations in wildfire activity by expanding our aerial firefighting services to new mission critical areas and geographies. Our deployment in Canada last year translated into the most territory covered in the history of the company and having gone through the regulatory process in Canada last year, we are hopeful that Bridge assist in Canada as part of normal operations going forward.

Speaker 2

In fact, wildfire risk is predicted to be above average at Canada in 24 according to North American Seasonal Fire Assessment and Outlook with fires erupting over the weekend in Vancouver, British Columbia, Phoenix smoke back into Minnesota and Wisconsin. Also complicating the situation above the border are zombie fires, blazes that have continued to smolder underground throughout the winter. The fires from 2023 are still burning and new fires have ignited. Beyond North America, we are on track with plans expand into Europe. Our partnership with Marathon Asset Management and Avenue Sustainable Solutions Fund completed the purchase of 4 Super Scoopers from the Spanish government last fall and positions us to meaningfully expand our fleet over the coming years.

Speaker 2

As part of the future expansion into Europe, our Spanish subsidiary, Alba Selt de Aero, is overseeing the return of service work on the 4 Spanish scooters, which I am pleased to say is on schedule with the 1st scooter to be available by the end of the 2025 fire season. Touching on our Ignis technology subsidiary, we continue to build and develop our pioneering mobile and web platform that elevates firefighters' situational awareness and produces real time high value data to better manage wildfire risk. As we approach the seasonal start of the fire season, we are winding up our maintenance, training and other activities and with our full spectrum of aviation resources. We are uniquely positioned to assist our state, federal and international customers in protecting lives and property from the growing threat of wildfires. Let me now turn it back to Eric, who will talk about our financial performance.

Speaker 1

Thank you, Tim. Looking at our results for the Q1 of 2024, revenue was a record $5,500,000 compared to $365,000 in the Q1 of 2023. 1st quarter revenue benefited this year from the early deployment of SuperScooper and surveillance aircraft at Texas and Oklahoma. Typically, Q1 revenue is minimal due to seasonality while we complete our annual fleet maintenance activities in preparation for the start of the U. S.

Speaker 1

Wildfire season. This year, Q1 revenue also included approximately $1,000,000 related to return to service work performed on the Spanish Super Scoopers by our Spanish subsidiary, Albacete Aero, as part of our partnership agreement with Marathon Asset Management and Avenue Sustainable Solutions Fund. We expect to realize similar amounts in future quarters. Cost of revenues was $9,200,000 in the Q1 of 2024, up 27 percent over $7,200,000 in the Q1 last year. Cost of revenues for the Q1 of 2024 was comprised of flight operation expenses of $5,000,000 and maintenance expenses of $4,200,000 This compares to $3,700,000 of flight operations expenses and $3,500,000 of maintenance expenses in the Q1 of 2023.

Speaker 1

The increase relates to higher flight operation expenses related to the earlier than typical fleet deployment as well as higher employee labor and other expenses associated with an additional SuperScooper aircraft that was placed into service in February of 2023. Selling, general and administrative expenses were $11,600,000 in the Q1 of 2024 compared to $33,200,000 in the first quarter of 2023. The decrease was primarily attributable to lower non cash stock based compensation expense in the Q1 of 2024 when compared to the Q1 of 2023 as a result of the restricted stock units issued in connection with the January 2023 business combination with Jack Creek Investment Corp. The decrease was also partially attributable to lower professional services fees in the Q1 of 2024 compared to the Q1 of 2023, which included fees in connection with the aforementioned business combination. Interest expense for the Q1 of 2024 increased to $5,900,000 from $5,700,000 in the Q1 of 2023.

Speaker 1

Bridger also reported other income of $1,200,000 for the Q1 compared to $1,100,000 for the Q1 last year. For the Q1 of 2024, we reported a net loss of $20,100,000 compared to a net loss of $44,700,000 in the Q1 of 2023. Adjusted EBITDA improved to negative $6,900,000 compared to negative 10 point $7,000,000 in the Q1 of 2023. Due to our largely fixed cost structure and seasonality, the company historically generates a net loss of negative EBITDA in the 1st and 4th quarters each year with positive adjusted EBITDA generated primarily in the 2nd and third quarters, which coincides with the U. S.

Speaker 1

Wildfire season. Turning to our balance sheet. As Tim mentioned, the Q1 of every year is typically the most working capital constrained due to fleet maintenance and training activities in the winter months, coupled with minimal revenue. As a result, we ended the quarter with total cash and restricted cash of $16,100,000 In April 2024, the company raised net proceeds of approximately $9,200,000 through our registered direct offering, resulting in an improved cash position going into the wildfire season. Our total cash and restricted cash balance was $26,500,000 as of April 30, 2024.

Speaker 1

Supported by the earlier than normal flight activity in Texas and Oklahoma in the quarter, we remain on target with the guidance we issued in November 2023 and then reiterated in February 2024 in conjunction with the release of our 4th quarter results. Bridger is projected to generate adjusted EBITDA of $35,000,000 to $51,000,000 on revenue of $70,000,000 to $86,000,000 This guidance includes the impact of recent reductions to the company's largely fixed cost structure and excludes any impact from the Spanish Super Scoopers acquired by the joint venture partnership, which are undergoing maintenance work in order to be returned to service. With that, I'd like to turn the call back to Tim for final comments.

Speaker 2

Thanks, Eric, and thanks to everyone for joining us on today's call. I'm incredibly proud of our team and our performance with a jump start to the season in the Q1, a profitable business model and strong fundamentals, a more efficient operating structure and a seasoned management team, we are well positioned to another record quarter another record year in 2024. We are also excited to welcome 2 new seasoned executive to our Board this past quarter. Each bring a wealth of experience, which we believe will prove invaluable to help guide the continued growth and value creation at BridgiroSpace. We look forward to updating you on our progress when we report our Q2 results in August.

Speaker 2

And if anyone has any follow-up questions, please reach out to our Investor Relations contact found on the IR section of our website. Thank you.

Operator

Thank you. This does conclude today's presentation. We appreciate your participation. You may disconnect at any time.

Powered by Quartr

Key Takeaways

  • Record Q1 revenue: Bridger Aerospace generated $5.5 million in Q1 FY2024—the highest quarter in company history—driven by early deployments of SuperScoopers and surveillance aircraft in Texas and Oklahoma.
  • Operational momentum: The company deployed two Pilatus PC-12 MMAs for aerial intelligence and four CL-415 SuperScoopers on the earliest-ever seasonal task orders, positioning Bridger for an expected active 2024 wildfire season.
  • Financial improvements: Net loss narrowed to $20.1 million from $44.7 million year-over-year, and adjusted EBITDA improved to negative $6.9 million versus negative $10.7 million, reflecting enhanced cost efficiency.
  • Strengthened liquidity: Bridger raised $9.2 million in April via a direct offering, boosting total cash and restricted cash to $26.5 million ahead of peak wildfire operations.
  • Growth and expansion strategy: The company secured regulatory approval for ongoing operations in Canada and advanced plans for European expansion through four acquired Spanish SuperScoopers, with the first scheduled for return to service by the end of the 2025 fire season.
AI Generated. May Contain Errors.
Earnings Conference Call
Bridger Aerospace Group Q1 2024
00:00 / 00:00