Blade Air Mobility, Inc.

Good afternoon, ladies and gentlemen, and welcome to the Blade Air Mobility Fiscal Second 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. If anyone should require operator assistance, please press star, then zero key on your touch telephone. As a reminder, this call is being recorded. I would like to turn the conference call over to Matt Schneider, Vice President of Investor Relations and Strategic Finance. Matthew, you may now begin.

Thank you for standing by and welcome to the Blade Air Mobility conference call and webcast for the quarter ended June 30th, 2024. We appreciate everyone joining us today. Before we get started, I would like to remind you of the 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 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 and 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 only made 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 investor presentation. Our press release investor presentation and our form 10Q and 10K 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 as 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 Haber, Chief Financial Officer. I will now turn the call over to Rob.

Thank you, Matt, and good afternoon, everyone. Let me make myself clear. We had a great quarter. Our strong Q2 2024 results marked Blade's first positive adjusted EBITDA second quarter as a public company, with both our medical and passenger segments enjoying strong performance and contributing positive segment adjusted EBITDA on the quarter. And as a guidepost for those listening, we have beaten every key metric of our sell-side investment banking consensus estimates of the five banks that cover us. In Q2 2024, revenue increased 11.4% year-over-year, Flight profit increased 57.7% year-over-year, and adjusted EBITDA of positive $1 million improved by $5.4 million versus negative $4.4 million in the prior year period. I will now review our key business, operational, and strategic highlights, starting with medical. Medical achieved a record high revenue of $38.3 million in the quarter, up 6.4% sequentially versus Q1 2024, and up 11.5% versus the prior year period. Excluding the impact of our non-recurring support of a large hospital in the prior year period, medical revenue increased 19% year-over-year. Medical segment adjusted EBITDA increased by 82.7% to 5.5 million in Q2 2024 versus the prior year period with margins expanding over 550 basis points year-over-year, also a record for the company. We closed on seven of the eight previously announced and committed jet aircraft acquisitions this quarter. While it's still early days, we're encouraged by both the value these aircraft provide to our customers and the initial financial performance of the fleet. While we continue to believe that the vast majority of our flying will remain with third-party owned and operated aircraft as part of our layered asset life approach, we believe there is an opportunity to expand our fleet of owned aircraft given both the customer benefits and strong returns that we're seeing. In simple terms, these aircraft are already delivering 30% plus returns on invested capital. We expect to close on the eighth aircraft during Q3 2024. We made additional progress expanding our medical ground logistics business and recently opened two new ground hubs, bringing our total to eight. Medical ground revenue increased more than 50% year over year during the quarter and represented 12% of medical revenue in the quarter. Will is going to provide more details on the financial performance and returns of our own aircraft and ground vehicles. Moving to passenger, revenue grew 11.3% versus the 2023 period, despite our discontinuation of the Blade 1 seasonal jet service this year. We saw strong growth in our New York airport transfer business, benefiting from increased average checkup prices, which averaged approximately $325 per seat during the quarter. We also saw strong growth in the airport charter. Additionally, we were pleased to see the number of airport passes outstanding up more than 30% year-over-year. Airport passes renew annually and are typically held by our most active and loyal flyers. By purchasing a pass, customers are signaling that they expect to fly more than eight times per year. The significant improvement in the passenger segment adjusted EBITDA this quarter and year-to-date, along with the decisive actions we're taking to drive further profitability improvements that we'll discuss shortly. underscore our commitment to achieving positive trailing 12-month passenger segment adjusted EBITDA in 2025 or earlier. In Q2, passenger segment flight profit increased 57.6% year-over-year and passenger segment adjusted EBITDA increased to a positive 0.8 million versus a loss of 2.1 million in the year-ago period. This quarter, we restructure our Canadian operations to eliminate further losses and lay the groundwork for our ultimate exit in the Canadian market. This will happen within the next year and could be completed as early as this month. We simply did not see a near-term path to profitability using conventional rotorcraft. We remain enthusiastic about the long-term opportunity for electric vertical aircraft in Western Canada and have structured our exit to maintain multiple paths to relaunch Canadian operations when the business can take economic advantage of the shift from conventional rotorcraft to electric vertical aircraft. Similar to our decision to discontinue the Blade 1 seasonal buy-the-seat service between New York and South Florida, we're making the prudent choice to exit an unprofitable business line and to focus our resources on the core roots in our passenger segment with limited or no competition and pricing elasticity, enabling a path to sustainable profitability. In Europe, we're encouraged by the early results of the steps we've taken to streamline our commercial organization and cost structure. Europe resumed year-over-year revenue growth during the quarter. We look forward to providing regular updates on our progress here. Back in March, our board authorized a $20 million share repurchase program, and we executed our first share repurchase under the authorization this quarter, eliminating approximately 80,000 shares. In addition, we changed our restricted stock unit tax withholding method to withhold to cover from sell to cover during the quarter, deploying approximately $1 million of balance sheet cash to retire an additional 332,212 shares at approximately $2.94 a share. We will continue to evaluate the optimal RSU tax withholding method in future periods. We're focused on maintaining a strong balance sheet and our capital allocation priorities are focused on low-risk, high-return investments in medical aircraft and ground vehicles, as well as bolt-on acquisitions in medical that enhance our competitive position or enable the expansion into other time-critical logistics verticals. It is imperative to us that we are convinced these investments are accretive on day one, We will continue to weigh these priorities relative to further opportunistic share repurchases as well. With that, I'll turn it over to Will.