Volato’s 2023 results were a tale of two sectors.
While total revenue dipped 24% year-over-year to $73.3m due to plummeting aircraft sales (down 68% YoY), the bright spot was a surging 162% YoY increase in aircraft usage revenue to $37.7m. The company blames the sales slump on industry-wide aircraft delivery delays. With only three deliveries in 2023, they fell short of fulfilling existing sales contracts. However, higher aircraft usage came on the back of a sharp increase total flight hours, reaching 11,273 in 2023 from 5,031 in 2022.
“Industry factors beyond our control – specifically aircraft delivery delays – put downward pressure on topline revenue in 2023. We are in close contact with our suppliers and partners and understand that production and supply chain issues are easing, providing us with good visibility into our 2024 and 2025 delivery pipeline,” said Matt Liotta, co-Founder and CEO, Volato in commentary accompanying the results.
Despite the sales woes, results show saw strong evidence of customer demand for Volato’s services. The significant rise in usage revenue suggests a healthy mix of owners and non-owners chartering flights. Notably, Volato boasts a 21% higher yield from non-owner usage compared to industry averages.
Volato closed the year with a net loss of $52.8m, a sharp increase from 2022. Although, this includes a non-cash charge of $13m, the underlying financials still show a cash burn.
However, the company maintains a $14.5m cash cushion and expects to reach profitability in 2024 based on forecast sales. The results also show a significant jump in year-end deposits, reaching $25m compared to a meager $0.8m in 2022 suggesting growing customer confidence in Volato’s future and potentially higher utilisation rates for their expanding fleet.
In terms of future outlook, Volato is anticipating between 9-12 aircraft to be delivered in 2024 (8-10 HondaJet Elite IIs and 1-2 Gulfstream G280s), contributing $99-145m of revenue and $22-32m of margin to Volato from their sale through fractionalising and significant ongoing revenue from the five-year contracted monthly management fee and flight operations.
