Q1 2024 Bridger Aerospace Group Holdings Inc Earnings Call

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Greetings and welcome to the Bridger Aerospace first quarter fiscal 'twenty 'twenty four Investor Conference call. As a reminder, today's call is being recorded it is now my pleasure to introduce your host Mr. Erik Gerets Chief Financial Officer, Mr. Charron, you may begin.

Good afternoon, and thank you for joining us today.

With me on the call. This afternoon is Chief Executive Officer, founder and director Tim She.

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.

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 factor.

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.

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.

Or to make any other forward looking statements.

Throughout this afternoon's earnings release, and our call today, we refer to non-GAAP financial measure of adjusted EBITDA.

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.

Thanks, Eric Good afternoon, and thanks for joining the call today, our first quarter well the most capital intensive as critical to allow us to finish winter maintenance on our fleet and complete flight training and agency <unk> that we are ready to mobilize on 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 snow pack in the slowest wildfire season in 20 years this year with the dry and arid weather in Oklahoma and Texas, we experienced really a seasonal deployment in company history with many predicting a more active 2020 for a fire season.

February we deployed one of our Polaris P. C 12, multi mission aircraft or M&A to Oklahoma to provide arrow intelligence for early season wildfires with a second PC 12 deployed in April.

Hey program, a critical Ponant incident planning decision, making tactical firefighting leverages. The architectural book of our proprietary data platform and leading edge sensor and mapping capability are two multi mission aircraft operate under a five year contract with the department of interior and your opinion affairs and both remain on task force today.

In early March we received the task order for Tuesday, all corporate team Super Scoopers aircrafts on the U S Forest service at the request of the state of Texas, which is battling the largest wildfire in state history. This isn't really a seasoned and quantity of our staples in history and our history of scrubbers are deployed in Congress for six weeks before recently the time to Montana.

Really wildfire activity in operational activity led to the highest first quarter revenue in our company history of 5.5 months.

Looking at 2024 early indications for the U S would that be the drier and warmer conditions of 24 wildfires seemed to be very active depending on the overall kind of log of wildfires and wildfire seasons, driving continued long term demand for aerial surveillance and suppression services.

And part of our strategy is to offset fluctuations in wildfire activity by expanding our aerial firefighting services to be mission critical areas and geographies.

In Canada last year translated into most territory, probably in the history of the company and having gone through the regulatory process in Canada last year. We are hopeful that puts you can put some quantity is quite a normal operations going forward. In fact wildfire risk is predicted to be above average in Canada 24. According to the North American seasonal cyrusone and outlook with Pfizer up and over the weekend in Vancouver, British Columbia.

Clinic smoke back in the Minnesota, and Wisconsin also compensating situation about a border of zombie Fire's blazed that'll continue to smaller undergone throughout the winter.

As far as from 2023 are still a blending of new players.

Yeah in North America, we are on track with plans to expand into Europe, a partnership with marathon asset management I'm Avenue Sustainable Solutions Fund completed the purchase of course Super Scoop as from the Spanish government last fall.

Positions us to meaningfully expand our fleet over the coming years as part of the future expansion into Europe, a small subsidiary almost like the Arrow is overseeing the return to service work in the Forest School was which I am pleased to say is on schedule with the first scrubber to be available by the end of the 2025 policies.

Plus we got our Ignace technology subsidiary, we continue to build and develop our pioneering mobile and web platform that elevates firefighter situational awareness and produces real time high value data to better manage wildfire risk as we approach the seasonal start to the piracy, we're winding up our maintenance training and other activities and what our full spectrum of their position.

We are uniquely positioned to assist the state federal and international customers and protecting lives and property from a growing set of wildfires.

Now I'll turn it back to Eric who will talk about it all at once.

Thank you Tim.

Looking at our results for the first quarter of 2020 for revenue was a record $5 $5 million compared to $365000 in the first quarter of 2023.

First quarter revenue benefited this year from the early deployment of Super Scoopers surveillance aircraft of Texas and Oklahoma.

<unk> first quarter revenue was minimal due to seasonality, while we complete our annual fleet maintenance activities in preparation for the start of the U S wildfire season.

This year first quarter revenue also included approximately $1 million related to a return to service work performed on the Spanish Super Scoopers buyer Spanish subsidiary all of this that the arrow 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 $2 million in the first quarter of 2024 up 27% over $7 2 million in the first quarter last year.

Cost of revenues for the first quarter of 2024 was comprised of flight operation expenses of $5 million.

And maintenance expenses of $4 $2 million this.

Theres, a $3 $7 million of flight operations expenses, and $3 $5 million of maintenance expenses in the first quarter of 2023.

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 additional within additional Super Scooper aircrafts, but was placed into service in February of 2023.

Selling general and administrative expenses were $11 $6 million in the first quarter of 2024 compared to $33 $2 million in the first quarter of 2023.

The decrease was primarily attributable to lower noncash stock based compensation expense in the first quarter of 2024, when compared to the first quarter 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 first quarter of 2024 compared to the first quarter of 2023, which included fees in connection with the aforementioned business combination.

Interest expense for the first quarter of 2024 increased to $5 9 million from $5 $7 million in the first quarter of 2023 Bridger.

<unk> also reported other income of $1 $2 million for the first quarter compared to $1 1 million for the first quarter last year.

For the first quarter of 2024, we reported a net loss of $20 1 million compared to a net loss of $44 $7 million in the first quarter 2023.

Adjusted EBITDA improved to negative $6 9 million compared to negative $10 $7 million in the first quarter of 2023.

Due to our largely fixed cost structure and seasonality the company historically generates a net loss of negative EBITDA in the first and fourth quarters each year with positive adjusted EBITDA generated primarily in the second and third quarters, which coincides with the U S wildfire season.

Turning to our balance sheet as Tim mentioned, the first quarter 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 $1 million.

In April 2024, the company raised net proceeds of approximately $9 $2 million through a registered direct offering resulting in an improved cash position going into the wildfire season, our total cash and restricted cash balance was $26 $5 billion as of April 30th 2024.

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 fourth quarter results.

Bridger is projected to generate adjusted EBITDA of $35 million to $51 million.

On revenue of 70 million to $86 million.

This guidance includes the impact of recent reduction to the company's largely fixed cost structure and excludes any impact from the Spanish Super Scoopers acquire.

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.

Thanks, Eric and thanks, everyone for joining us on today's call incredibly proud of our team and our performance with a jump start to the season in the first quarter, a profitable business model and strong fundamentals a more efficient operating structure and a seasoned management team. We are well positioned to report another record quarter. Another record year. In 2024. We're also excited to welcome two new.

Seasoned executive to our board this past quarter. They each bring a wealth of experience that we believe will prove invaluable to help guide the continued growth and value creation epidural space.

We look forward to updating on our progress when we report our second quarter results in August 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.

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

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