Blade Air Mobility, Inc.

Good morning, ladies and gentlemen, and welcome to the Blade Air Mobility Fiscal Third Quarter 2023 Earnings Release Conference Call. At this time, all participants are in a listen-only mode. Later, we'll conduct a question-and-answer session, and instructions will follow at that time. As a reminder, this call is being recorded. I would now like to turn the conference call over to Mr. Lee Gold, Investor Relations. You may begin.

Thanks and good morning. Thank you for standing by and welcome to the Blade Air Mobility Conference Call on WebCats for the quarter ended September 30th, 2023. We appreciate everyone joining us today. Before we get started, I would like to remind you of this company's forward-looking statement in safe harbor language. Statements made in this conference call that are not historical facts, including statements about future time periods, may be deemed to constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties, and the actual future results may differ materially from those expressed or implied by the forward-looking statements. We refer you to our SEC filing, including our annual report on Form 10-K filed with the SEC, for a more detailed discussion of the risk factors that could cause these differences. Any forward-looking statements provided during this conference call are made only as of the date of this call. As stated in our SEC filings, Blades disclaims any intent or obligation to update or revise these forward-looking statements except required by law. During today's call, we will also discuss certain non-GAAP financial measures, which we believe may be useful in evaluating our financial performance. A reconciliation of the most directly comparable consolidated GAAP financial measures to those non-GAAP financial measures is provided in our earnings press release and investor presentation. Our press release, investor presentation, and our Form 10Q presentation are available on the investor relations section of our website at ir.blade.com. These non-GAAP measures should not be considered in isolation or substitute for financial results prepared in accordance with GAAP. Hosting today's call are Rob Wiedenthal, Founder and Chief Executive Officer of Blade, and Will Habern, Chief Financial Officer. I will now turn the call over to Rob Wiedenthal. Rob?

Thank you, Lee. Good morning, everyone. We are very pleased to deliver our first quarter of positive free cash flow and positive adjusted EBITDA while maintaining rapid revenue growth in both the passenger and medical segments. Revenue in the quarter ending September 30, 2023, increased 56% to $71.4 million versus $45.7 million in the comparable 2022 period. We achieved free cash flow of $1.3 million in Q3 2023, with 7.8 million improvement from Q3 2022, while adjusted EBITDA of 0.8 million in Q3 2023 improved 5.3 million versus Q3 2022. Importantly, as we turn the corner to profitability, we are doing so without sacrificing revenue growth. Starting in passenger, short distance delivered another quarter of significant growth with revenue up 49% year-over-year, driven by our acquisitions in Europe and improvement across our entire short-distance route network. We are especially pleased that our flagship urban air mobility service, Blade Airport, enjoyed continued improved financial performance with strong revenue growth in addition to positive flight profit contribution for the first time during Q3 2023. Airport is one of our most important growth vectors for the passenger business, as it will be the very first use case for electric vertical aircraft, EVA, or in industry parlance, eVTOL. But the ramp-up has required patience from both you, our investors, and our management team. It's taken two years of steadily growing our passenger volumes, route offerings, average checkout price, and seat utilization to reach today's critical profitability milestone. In Q4 2023, quarter to date, we've seen solid seat growth, that we expect will unlock continued incremental profitability for airport in the future. We have also made great progress in optimizing our aircraft capacity agreements to capitalize on our growing scale, enabling Blade to benefit from the economic leverage of a more active fleet. We are already seeing this translate to flight profit margin expansion in both our medical and passenger segments. This is a win-win. both for our operators and our customers as we direct more flight hours to our most reliable and efficient aircraft providers. In jet another, we also saw strong growth as revenue increased 49.1% to $7.6 million. Our growth across passenger, coupled with our return to profitability in the airport, contributed to a significant 88.7% increase in passenger segment adjusted EBITDA to $2.8 million for Q3 2023. On the strategic front, we continue expanding our infrastructure footprint. In Atlantic City, we've partnered with Ocean Casino to create an exclusive blade heliport, allowing our flyers to land directly at the resort. Charter service is available today, and by the seat service backstopped by Ocean Casino is planned for spring 2024. In France, at Nice International Airport, The opening of an on-tarmac security checkpoint will enable our flyers to bypass crowded terminals and proceed directly to their commercial airline gate after landing on a Blade helicopter. This will reduce the travel time between the Blade helicopter arrivals and the commercial gate by 45 minutes or more for all of our European urban air mobility products where passengers are connecting to airlines in Nice. This is consistent with our infrastructure strategy around the world. We are able to leverage our significant passenger volumes and brand recognitions to strike partnerships with infrastructure owners that provide unique access to terminal space, improving the passenger experience with limited cost. These arrangements are a win-win for all parties and will provide an important strategic advantage as we begin to transition from conventional rotorcraft to EVA in the coming years. We made important progress on the EVA front just last week as our operator for Blade Canada, which operates as Helijet, placed an order for the Beta Technologies ALEA electric vertical aircraft, which is expected to provide quiet, emission-free air mobility service for Blade flyers in Canada. This order is for the same aircraft that Blade recently utilized during our first EVA test in the New York City area in Q1. Now we'll turn to medical where we delivered 65% organic growth driven by continued new hospital wins, business expansion with existing hospitals, and strong end market growth. We continue to demonstrate the strong operating leverage of this business with medical segment adjusted EBITDA increasing 123.8% to $3.3 million. We're also excited to announce the launch of our new organ placement service, an offering that has been requested by a significant portion of our existing customers. This new business line, which goes live on December 1st, brings us further upstream in the organ transplantation process by helping transplant centers determine if an organ is a match for a potential recipient. When paired with our existing logistics services, we can now provide even more seamless engagement simplify the communication process for our customers, and increase our revenue per transplant. The wider the breadth of our services we offer our hospital clients, the more we can help them and the deeper we become integrated in their mission to save lives. All that will provide some additional details on the unit economics shortly. As evidenced by this quarter's results, we remain on track with our commitment to deliver a meaningful improvement in full-year adjusted EBITDA in 2023 versus 2022. And we also expect further year-over-year adjusted EBITDA improvement in Q4 of this year. Looking to 2024, we expect even better results with significantly improved adjusted EBITDA versus 2023. We plan to provide guidance for both the full year 2024 and 2025 as part of our Q4 2023 earnings release. With that, I'll turn the call over to Will.