Sky Harbour Group Corporation

Good afternoon. My name is Tina, and I will be your conference operator today. At this time, I would like to welcome everyone to the conference call. All lines have been placed on mute to prevent any background noise. After this speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply submit a question online using the webcast URL posted on our website. Thank you. CFO Francisco Gonzalez, you may begin your conference.

Thank you, Tina. I'm Francisco Gonzalez, CFO of Sky Harbor. Hello and welcome to the 2025 First Quarter Investor Conference call and webcast for the Sky Harbor Group Corporation. We have also invited our bondholder investors in our borrowing subsidiary, Sky Harbor Capital, to join and participate on this call. Before we begin, I've been asked by counsel to note that on today's call, the company will address certain factors that may impact this and next year's earnings. Some of the information that we'll discuss today contains forward-looking statements. These statements are based on management assumptions, which may or may not come true, and you should refer to the language on slides one and two of this presentation, as well as our ACC filings, for a description of the factors that may cause actual results to differ from our forward-looking statements. All forward-looking statements are made as of today, and we assume no obligation to update any such statements. Wanted to note the picture here on the deck is one of our new hangars at our new campus that just opened in the city of Addison just north of downtown Dallas. This hangar is beautiful. If you notice in the picture, it has a mezzanine level and floor-to-roof wall windows in the office space overlooking the hangar. The jet shown is a Bombardier Global 7500. one of the largest jets in business aviation and fits nicely into our hangar space. We're now moving to even larger size hangars in our future campuses to accommodate even larger single jets or customers with fleets. So now let's get started. The team with us this afternoon, you know from prior webcasts, our CEO and chair of the board, Tal Kanan, our treasurer, Tim Herr, our chief accounting officer, Mike Smith, and our accounting manager, Tori Petro. We also have Marty Creshman with us. Some of you remember he joined us as head of airports about a year ago after a successful career at Singletary Aviation. We have a few slides we'll want to review with you before we open it to questions. These were filed with the SEC about an hour ago in Form 8K, along with our thank you, and will also be available on our website later this evening. We also filed our first quarter Sky Harbor Capital obligated group financials with MSRP EMA also about an hour ago. As the operator stated, you may submit breathing questions during the webcast, during the Q4 platform, and we'll address them shortly after our prepared remarks. So let's get started. Next slide, please. In the first quarter, on a consolidated basis, assets under construction and completed construction continued to accelerate, reaching over $275 million as of quarter end on the back of construction activity in Phoenix, Dallas, and Denver. Revenues experienced an increase of 133% over a year ago, and 20% sequentially as we incorporate the operations from the acquisition of the Camarillo Campus last December. Operating expenses in Q1 increased moderately due to several factors which Mike, our Chief Accounting Officer, will break down shortly in more detail. We strive to keep SG&A in check as we grow, keeping frugality front and center in our expense and cost management initiatives. Cash flow using operating activities moved higher, which usually happens in each of our first quarters, but this quarter in particular for the increase in operating costs that Mike will explain now. We wanted to also reaffirm our prior guidance that we expect Sky Harbor to reach cash flow breakeven on a consolidated basis at the end of this year as we ramp up the leasing and cash flowing of the new three campuses over the summer and fall.

Next slide, Mike. Thank you, Francisco. I'd like to discuss a few of the factors impacting the comparability between some of our reported operating expenses this quarter as compared to the prior. Of the one and a half million increase, approximately a third of the increase relates to an increase in our reported fuel expenses, which is simply a function of us reporting fuel growths at our Camarillo hangar campus as opposed to net, as we do with many of our others. Two other impactful factors include our startup expenses, including increases in headcount at our ADS, APA, and DBT locations. This was further impacted by a full quarter of our operations at our Camarillo hangar campus, which, as you may recall, was acquired in December of 2024. Similarly, our cash use and operating activities was impacted by many of the things I just went over. but was also impacted by a decrease in accounts payable, largely just due to timing of payment driven by an effort to speed up the time in which we pay our vendors. Thank you. Back to Francisco.