Blade Air Mobility, Inc.

Good morning, ladies and gentlemen, and welcome to the Blade Air Mobility Fiscal First Quarter 2024 Earnings Release Conference Call. At this time, all participants are in a listen-only mode. Later, we will 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 over to Matt Schneider, Vice President, Investor Relations and Strategic Finance. Matthew, you may begin.

Thanks, and good morning. Thank you for standing by and welcome to the Blade Air Mobility conference call and webcast for the quarter ended March 31st, 2024. We appreciate everyone joining us today. Before we get started, I would like to remind you of the company's forward-looking statement and 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 actual future results may differ materially from those expressed or implied by the forward-looking statements. We refer you to our SEC filings, 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 the conference call are made only as of the date of this call. As stated in our SEC filings, Blade disclaims any intent or obligation to update or revise these forward-looking statements, except as 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 historical, comparable, consolidated GAAP financial measures to those historical non-GAAP financial measures is provided in our earnings press release and investor presentation. Our press release, investor presentation, and our Form 10-Q and 10-K filings 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 a substitute for financial results prepared in accordance with GAAP. Hosting today's call are Rob Wiesenthal, founder and chief executive officer of Blade, and Will Hayburn, chief financial officer. I will now turn the call over to Rob. Rob?

Thank you, Matt, and good morning, everyone. I'm very pleased to report a strong start to 2024 that represents an early but important first step in achieving the 2024 and 2025 financial guidance that we provided last quarter and reaffirmed today. Most notably, this was the best quarter in company history for our medical business. We achieved record revenue and segment adjusted EBITDA, building upon our dramatic growth driven by increased trip volumes and trip distances both from existing and newly added hospital clients. This should address issues that have been raised on the impact of competition. We are America's largest dedicated air transporter of human organs for transplant, and we are confident we are the most cost-effective as well. Total revenue in the first quarter ending March 31, 2024, increased 13.8% to 51.5 million versus the comparable period in 2023. Excluding the impact of last year's discontinuation of Blade 1, our scheduled jet service between New York and South Florida, total revenue increased 21.5% year over year. Profitability continues to improve across the business driven by several initiatives, including a shift to dedicated aircraft and vehicles in our medical business, meaningful profitability improvements in our New York by-the-seat airport service, and a continuation of cost rationalization programs across the company, including the elimination of unprofitable services such as Blade 1. While total revenue increased 13.8% year-over-year, total flight profit increased by 41.5% year-over-year, as flight margins rose to 19.7%, in Q1 2024 as compared to 15.8% for the comparable period last year. We achieved significant year-over-year improvement in both medical and passenger segment adjusted EBITDA, which when coupled with a 19% year-over-year decline in our adjusted unallocated corporate expenses, drove a strong $4.2 million improvement in adjusted EBITDA in Q1 2024 versus the comparable period last year. Medical revenue increased 34.6% in Q1 2024 year-over-year, and importantly, we saw the resumption of sequential revenue growth in the quarter with revenues increasing 12.6% versus the fourth quarter of 2023. Medical segment adjusted EBITDA increased 134.5% year-over-year as adjusted EBITDA margins rose over 500 basis points versus the comparable period last year. Additionally, our clients' use of perfusion and other organ preservation devices continues to grow the overall market beyond industry expectations, given the ability to move organs over much longer distances and accept organs that just a few years ago would not have been suitable for transplant. When our contracted clients utilize these devices, they continue to use Blade's logistics services. We have now closed on seven of the eight jet aircraft acquisitions that we announced last quarter. This is a win-win as it enables lower costs and improved service delivery for our clients and improved flight margins per trip for Blade. The vast majority of our flying will remain with third-party owned and operated aircraft as part of our layered asset light approach, enabling maximum flexibility and availability for the hospitals we serve. In our passenger business, despite inconsistent year-over-year revenue comparisons due to the discontinuation of our Blade 1 scheduled jet service, poor flying weather for ski season in Europe, and lower passenger volume in Canada, the passenger segment still reported a $0.4 million year-over-year improvement in adjusted EBITDA. Importantly, we continue to see improvement in our New York by-the-seat airport service with revenues increasing 26% year-over-year in our third consecutive quarter of positive flight margin. The airport business remains our most strategic route given the combination of the large addressable market of 27 million annual flyers and our proprietary passenger infrastructure in New York City. We have also... seeing continued growth in revenue per seat, while the total number of airport passes outstanding, which allow flyers to travel between Manhattan and JFK or Newark Airport for as low as $95 per seat, rose more than 30% year over year. Given the annual cost of our passes of $795 per pass, purchasers are signaling that they expect to fly Blade Airport more than eight times during the course of the year. As a reminder, Q1 is the seasonally lightest quarter for short-distance business. Regardless, I'm pleased to see that we're delivering on the cost savings and profitability improvements we promised both in the passenger segment and on the corporate level. Before I turn the call over to Will, I would like to address our long-planned management transition in the medical division. Seth Bacon, founder of Trinity Air Medical, which we acquired in September 2021, will assume the role of Executive Chairman of Blade Medical. He will continue to be involved in all strategic manners, key client relationships, and high-value sales processes. Our current medical COO, Scott Wunsch, will assume the role of Chief Executive Officer of Blade Medical. Scott has been with Trinity since 2018 and previously spent 13 years at one of the largest organ procurement organizations in the country. Scott has served as Trinity's COO for the past four years, where he's been responsible for day-to-day oversight of Trinity, and following our acquisition, Blade Medical Operations. Seth has built an incredible team in Phoenix. He is a large shareholder, and from his new position, he will continue to foster the culture of excellence that has led to our incredible success. With that, I'll turn it over to Will.