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  Title	Wheels Up Experience : Press Release 2024 Q3
  ID	4421922
  External ID	7282462926
  Author	Unknown
  Published Date	Nov. 7, 2024, 7:50 a.m.
  Summary	Wheels Up Reports Third Quarter Results Improvement in financial performance driven by operating initiatives over past year Fleet modernization plan represents next phase of strategic journey to profi
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  URL	https://www.marketscreener.com/quote/stock/wheels-up-experience-inc-124803346/news/wheels-up-experience-press-release-2024-q3-48291646/
  Sentiment	Negative: 0.02012    Neutral: 0.02100    Positive: 0.95888
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  Content ID	2639397
  Key	e5388236-f2e6-4a54-b813-3941afefa1b0
  Content	Wheels Up Reports Third Quarter Results Improvement in financial performance driven by operating initiatives over past year Fleet modernization plan represents next phase of strategic journey to profitability New credit facility expected to strengthen balance sheet; credit support from Delta Air Lines underscores commitment to strategic partnership ATLANTA - November 7, 2024 - Wheels Up Experience Inc. (NYSE:UP) today announced financial results for the third quarter, which ended September 30, 2024. Third Quarter 2024 Highlights1 Revenue was $194 million, stabilizing at levels consistent with the first and second quarters of 2024, though down year over year due primarily to the sale of non-core businesses and focus on profitable flying non-core businesses and focus on profitable flying Adjusted Contribution Margin was 14.8%, the highest as a public company, and an increase of 380 basis points year over year and 700 basis points sequentially Net loss was $58 million for the quarter, an improvement of $87 million year over year and $39 million sequentially Adjusted EBITDA loss was $20 million, an improvement of $17 million sequentially and slightly worse year over year on lower revenues Net cash used in operating activities improved to an outflow of $15 million, a 94% improvement versus $250 million last year "After seven consecutive quarters of revenue contraction leading into 2024, the intentional improvements we have made to our business over the last year have stabilized our top line, expanded margins to record levels, and positioned us for growth," said George Mattson, Chief Executive Officer. "We expect our next phase of financial and operational improvement to be driven by the positive impact of our fleet transition, both immediately and over the next several years." "This quarter's Adjusted Contribution Margin was the highest in our history as a public company," said Eric Cabezas, Interim Chief Financial Officer. "We have made significant progress in reducing our operating cash burn and expect to achieve positive Adjusted EBITDA for the full year 2025, positioning the company for future profitability and long-term success. We expect the closing of our new revolving credit facility will enhance our access to capital and bolster our liquidity position, allowing us to expedite the modernization of our fleet and scale our business." Recent Initiatives Detailed a fleet modernization strategy for the replacement of the Company's existing jet fleet across four aircraft types with two of the most preferred and successful aircraft in the industry: Embraer's Phenom 300 series and Bombardier's Challenger 300 series platforms. For sequential change information, see "Financial and Operating Highlights," the condensed consolidated statements of operations for the three and six months ended June 30, 2024 and 2023, the condensed consolidated statements of cash flows for the six months ended June 30, 2024 and 2023, and "Reconciliations of non-GAAP financial measures" relating to such periods included in this press release. Announced plans to acquire the GrandView Aviation fleet of 17 Phenom 300 and 300E aircraft, which is expected to establish Wheels Up as the largest on-demand charter operator of Phenom 300 series aircraft in the world. on-demand charter operator of Phenom 300 series aircraft in the world. Agreed to sell all 13 owned Citation X aircraft, and expect to lease a portion of the sold aircraft and amend existing Citation X leases to provide lease flexibility that will ease the transition to the Challenger 300 series aircraft. Secured up to $332 million commitment from Bank of America for new senior secured revolving credit facility. Credit support from Delta Air Lines expected to provide enhanced access to capital and on more attractive terms than the Company's existing aircraft facility. Anticipated funding under the new facility will be used to acquire the GrandView Aviation fleet, refinance existing aircraft debt, and provide a funding source for future aircraft acquisition as part of the Company's fleet modernization strategy. Additionally, in combination with proceeds from aircraft sales under contract, the refinancing is expected to add up to $115 million of cash to the balance sheet. Signed a letter of intent to equip anticipated Phenom and Challenger aircraft with Gogo's best-in-class Galileo HDX satellite-based WiFi, delivering high bandwidth, low latency, and universal coverage capable of live streaming and voice telephony. Financial and Operating Highlights(1) As of September 30, 2024 2023 % Change Active Members 6,699 10,775 (38) % Three Months Ended September 30, (In thousands, except Active Users, Live Flight Legs, Private Jet Gross 2024 2023 % Change Bookings per Live Flight Leg and percentages) Active Users 8,215 12,549 (35) % On-Time Performance (D-60) 82 % 86 % n/m Completion Rate 98 % 98 % n/m Live Flight Legs 12,776 16,581 (23) % Private Jet Gross Bookings $ 204,289 $ 255,415 (20) % Total Gross Bookings $ 255,102 $ 303,407 (16) % Private Jet Gross Bookings per Live Flight Leg $ 15,990 $ 15,404 4 % Revenue $ 193,903 $ 320,063 (39) % Gross profit $ 14,560 $ 4,717 209 % Adjusted Contribution $ 28,758 $ 35,243 (18) % Adjusted Contribution Margin 14.8 % 11.0 % 4 pp Net loss $ (57,731) $ (144,813) 60 % Adjusted EBITDA $ (19,982) $ (18,529) (8) % Net cash used in operating activities $ (15,031) $ (249,824) 94 % Nine Months Ended September 30, (In thousands) 2024 2023 % Change Revenue $ 587,289 $ 1,006,937 (42) % Gross profit (loss) $ (12,992) $ (19,671) 34 % Adjusted Contribution $ 46,071 $ 59,688 (23) % Adjusted Contribution Margin 7.8 % 5.9 % 2 pp Net loss $ (252,097) $ (406,272) 38 % Adjusted EBITDA $ (106,566) $ (107,747) 1 % Net cash used in operating activities $ (115,814) $ (661,494) 82 % __________________ For information regarding Wheels Up's use and definitions of our key operating metrics and non-GAAP financial measures, see "Definitions of Key Operating Metrics, "Definitions of Non-GAAP Financial Measures" and "Reconciliations of Non-GAAP Financial Measures" sections herein. n/m Not meaningful For the third quarter: Active Members decreased 38% year-over-year to 6,699, primarily as a result of the regionalization of our member programs and focus on profitable flying, as well as streamlining our membership offering. year-over-year to 6,699, primarily as a result of the regionalization of our member programs and focus on profitable flying, as well as streamlining our membership offering. Active Users decreased 35% year-over-year to 8,215, primarily related to the decline in Active Members. year-over-year to 8,215, primarily related to the decline in Active Members. Revenue decreased 39% year-over-year, primarily driven by exiting the aircraft management and aircraft sale businesses, as well as reduced Flight revenue, primarily due to our focus on more profitable flying. year-over-year, primarily driven by exiting the aircraft management and aircraft sale businesses, as well as reduced Flight revenue, primarily due to our focus on more profitable flying. Net loss improved by $87.1 million year-over-year to $57.7 million, as the third quarter of 2023 included a $56.2 million non-cash goodwill impairment charge with no equivalent charge in the third quarter of 2024. year-over-year to $57.7 million, as the third quarter of 2023 included a $56.2 million non-cash goodwill impairment charge with no equivalent charge in the third quarter of 2024. Adjusted EBITDA loss slightly increased by $1.5 million year-over-year to $20.0 million, reflecting the absence of $5.9 million of software licensing revenue recognized in the third quarter of 2023 with no current year equivalent, partially offset by our operational efficiency and other spend reduction efforts. Three Months Ended (In thousands, except percentages)(1) September 30, June 30, 2024 % Change 2024 Revenue $ 193,903 $ 196,285 (1) % Gross profit (loss) $ 14,560 $ (10,998) 232 % Adjusted Contribution $ 28,758 $ 15,298 88 % Adjusted Contribution Margin 14.8 % 7.8 % 7 pp Net loss $ (57,731) $ (96,973) 40 % Adjusted EBITDA $ (19,982) $ (37,355) 47 % __________________ For information regarding Wheels Up's use and definitions of our key operating metrics and non-GAAP financial measures, see "Definitions of Key Operating Metrics, "Definitions of Non-GAAP Financial Measures" and "Reconciliations of Non-GAAP Financial Measures" sections herein. n/m Not meaningful About Wheels Up Wheels Up is a leading provider of on-demand private aviation in the U.S. and one of the largest companies in the industry. Wheels Up offers a complete global aviation solution with a large and diverse fleet and a global network of safety vetted charter operators, all backed by an uncompromising commitment to safety and service. Customers can access charter and membership programs, as well as unique commercial travel benefits through a one-of-a-kind, strategic partnership with Delta Air Lines. Wheels Up also offers freight, safety and security solutions and managed services to individuals, industry, government and civil organizations. Wheels Up is guided by the mission to deliver a premium solution for every customer journey. With the Wheels Up mobile app and website, members and customers have the digital convenience to search, book and fly. Cautionary Note Regarding Forward-Looking Statements This press release contains certain "forward-looking statements" within the meaning of the federal securities laws. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside of the control of Wheels Up Experience Inc. ("Wheels Up", or "we", "us", or "our"), that could cause actual results to differ materially from the results discussed in the forward-looking statements. These forward-looking statements include, but are not limited to, statements regarding: (i) the impact of Wheels Up's cost reduction efforts and measures intended to increase Wheels Up's operational efficiency on its business and results of operations, including the timing and magnitude of such expected actions and any associated expenses in relation to liquidity levels and working capital needs; (ii) Wheels Up's fleet modernization strategy and its ability to execute such strategy, as well as the expected operational and financial impacts to Wheels Up from implementing such strategy on the timeline that it currently anticipates; (iii) the degree of market acceptance and adoption of Wheels Up's products and services, including the changes to our member programs and charter offerings announced in June 2024 and any additional new or revised products introduced by Wheels Up; (iv) the size, demands, competition in and growth potential of the markets for Wheels Up's products and services and Wheels Up's ability to serve and compete in those markets; (v) Wheels Up's liquidity, future cash flows and certain restrictions related to its indebtedness obligations, and its ability to perform under its contractual and indebtedness obligations; (vi) Wheels Up's ability to achieve positive Adjusted EBITDA (as defined herein) in the future pursuant to the most recent schedule that it has announced; (vii) Wheels Up's ability to consummate the closing of pending acquisitions and sales of aircraft and assets on the schedule that it currently anticipates or at all, and the expected benefits or impacts to Wheels Up from such pending transactions and the operation of any aircraft or assets following the closing of such transactions; (viii) Wheels Up's ability to consummate the initial closing of any new financing on the terms and timeline that it currently anticipates, and the expected benefits or impacts to Wheels Up from such financing, including the expected terms of such financing, the ability to use net proceeds from such financing to consummate any pending aircraft and asset acquisitions, the refinancing of Wheels Up's existing equipment notes, the potential receipt and expected use of any remaining net proceeds from the initial closing under such financing (including the potential future acquisition of aircraft using such net proceeds, assumptions about the consummation of aircraft sales currently under contract and other factors that may impact the amount of remaining net proceeds from such initial closing) and the ability of the Company to reborrow under such financing in the future; and (ix) the impacts of general economic and geopolitical conditions on Wheels Up's business and the aviation industry, including due to fluctuations in interest rates, inflation, foreign currencies, consumer and business spending decisions, and general levels of economic activity. In addition, any statements that refer to projections, forecasts, or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "might," "plan," "possible," "potential," "predict," "project," "should," "strive," "would" and similar expressions may identify forward-looking statements, but the absence of these words does not mean that statement is not forward-looking. We have identified certain known material risk factors applicable to Wheels Up in our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the U.S. Securities and Exchange Commission ("SEC") and our other filings with the SEC. Moreover, it is not always possible for us to predict how new risks and uncertainties that arise from time to time may affect us. You are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made. Except as required by law, we do not intend to update any of these forward-looking statements after the date of this press release. Use of Non-GAAP Financial Measures This press release includes certain non-GAAP financial measures, such as Adjusted EBITDA, Adjusted Contribution and Adjusted Contribution Margin. These non-GAAP financial measures are an addition, and not a substitute for or superior to, measures of financial performance prepared in accordance with generally accepted accounting principles in the United States of America ("GAAP") and should not be considered as an alternative to revenue or any component thereof, net income (loss), operating income (loss) or any other performance measures derived in accordance with GAAP. Definitions and reconciliations of non-GAAP financial measures to their most comparable GAAP counterparts are included in the sections titled "Definitions of key metrics and non-GAAP financial measures" and "Reconciliations of non-GAAP financial measures," respectively, in this press release. Wheels Up believes that these non-GAAP financial measures of financial results provide useful supplemental information to investors about Wheels Up. However, there are a number of limitations related to the use of these non-GAAP financial measures and their nearest GAAP equivalents, including that they exclude significant expenses that are required by GAAP to be recorded in Wheels Up's financial measures. In addition, other companies may calculate non-GAAP financial measures differently, or may use other measures to calculate their financial performance, and therefore, Wheels Up's non-GAAP financial measures may not be directly comparable to similarly titled measures of other companies. Additionally, to the extent that forward-looking non-GAAP financial measures are provided, they are presented on a non-GAAP basis without reconciliations of such forward-looking non-GAAP financial measures due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliations. For more information on these non-GAAP financial measures, see the sections titled "Definitions of key metrics and non-GAAP financial measures" and "Reconciliations of non-GAAP financial measures" included in this press release. Contacts Investors: ir@wheelsup.com Media: press@wheelsup.com WHEELS UP EXPERIENCE INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited, in thousands, except share data) September 30, 2024 December 31, 2023 ASSETS Current assets: Cash and cash equivalents $ 115,909 $ 263,909 Accounts receivable, net 32,029 38,237 Parts and supplies inventories, net 22,539 20,400 Aircraft held for sale 50,652 30,496 Prepaid expenses 29,490 55,715 Other current assets 20,691 25,277 ............................................................................................Total current assets 271,310 434,034 Property and equipment, net 266,534 337,714 Operating lease right-of-useassets 54,588 68,910 Goodwill 222,482 218,208 Intangible assets, net 102,663 117,766 Other non-currentassets 125,560 139,428 ..........................................................................................................Total assets $ 1,043,137 $ 1,316,060 LIABILITIES AND EQUITY Current liabilities: Current maturities of long-termdebt $ 30,048 $ 23,998 Accounts payable 34,997 32,973 Accrued expenses 94,369 102,475 Deferred revenue, current 711,097 723,246 Other current liabilities 17,898 24,810 .......................................................................................Total current liabilities 888,409 907,502 Long-termdebt, net 209,586 235,074 Operating lease liabilities, non-current 47,816 54,956 Other non-currentliabilities 11,505 18,655 .....................................................................................................Total liabilities 1,157,316 1,216,187 Mezzanine equity: Contingent performance awards 3,487 2,476 Total mezzanine equity 3,487 2,476 Equity: Common Stock, $0.0001 par value; 1,500,000,000 authorized; 698,251,115 and 70 70 697,131,838 shares issued and 697,811,664 and 696,856,131 shares outstanding as of September 30, 2024 and December 31, 2023, respectively Additional paid-incapital 1,911,362 1,879,009 Accumulated deficit (2,015,357) (1,763,260) Accumulated other comprehensive loss (5,537) (10,704) Treasury stock, at cost, 439,451 and 275,707 shares, respectively (8,204) (7,718) ..................................Total Wheels Up Experience Inc. stockholders' equity (117,666) 97,397 Non-controllinginterests - - .........................................................................................................Total equity (117,666) 97,397 .................................................................................Total liabilities and equity $ 1,043,137 $ 1,316,060 WHEELS UP EXPERIENCE INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited, in thousands except share and per share data) Three Months Ended September 30, Nine Months Ended September 30, 2024 2023 2024 2023 .........................................................................Revenue $ 193,903 $ 320,063 $ 587,289 $ 1,006,937 Costs and expenses: Cost of revenue (exclusive of items shown 166,859 299,887 556,809 981,581 separately below) Technology and development 9,594 19,962 31,204 50,265 Sales and marketing 20,029 22,548 62,946 71,500 General and administrative 27,058 42,853 99,244 122,334 Depreciation and amortization 12,484 15,459 43,472 45,027 (Gain) loss on sale of aircraft held for sale (190) (7,841) (2,680) (11,328) Impairment of goodwill - 56,200 - 126,200 ..............................Total costs and expenses 235,834 449,068 790,995 1,385,579 Loss from operations (41,931) (129,005) (203,706) (378,642) Other income (expense) Gain (loss) on divestiture - (2,991) 3,403 (2,991) Gain (loss) on disposal of assets, net 70 - (1,757) (1,538) Loss on extinguishment of debt (289) (1,936) (2,800) (2,806) Change in fair value of warrant liability 107 (61) 9 685 Interest income 907 404 1,248 6,090 Interest expense (16,041) (11,258) (47,263) (27,035) Other income (expense), net (149) 613 (499) 716 Total other income (expense) (15,395) (15,229) (47,659) (26,879) Loss before income taxes (57,326) (144,234) (251,365) (405,521) Income tax benefit (expense) (405) (579) (732) (751) Net loss (57,731) (144,813) (252,097) (406,272) Less: Net loss attributable to non-controlling - - - - interests Net loss attributable to Wheels Up Experience Inc... $ (57,731) $ (144,813) $ (252,097) $ (406,272) Net loss per share of Common Stock Basic and diluted $ (0.08) $ (3.51) $ (0.36) $ (13.22) Weighted-average shares of Common Stock outstanding: Basic and diluted 697,721,699 41,261,003 697,575,821 30,737,324 WHEELS UP EXPERIENCE INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited, in thousands except share and per share data) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 .........................................................................Revenue $ 196,285 $ 335,062 $ 393,386 $ 686,874 Costs and expenses: Cost of revenue (exclusive of items shown 191,690 327,903 389,950 681,694 separately below) Technology and development 10,529 14,430 21,610 30,303 Sales and marketing 21,480 23,149 42,917 48,952 General and administrative 35,949 40,065 72,186 79,481 Depreciation and amortization 15,593 15,123 30,988 29,568 (Gain) loss on sale of aircraft held for sale 234 (2,621) (2,490) (3,487) Impairment of goodwill - 70,000 - 70,000 ..............................Total costs and expenses 275,475 488,049 555,161 936,511 Loss from operations (79,190) (152,987) (161,775) (249,637) Other income (expense) Gain (loss) on disposal of assets, net 136 (1,538) 1,576 (1,538) Loss on extinguishment of debt (805) (870) (2,511) (870) Change in fair value of warrant liability (70) 621 (98) 746 Interest income 285 1,865 341 5,686 Interest expense (16,667) (7,658) (31,222) (15,777) Other income (expense), net (221) (42) (350) 103 Total other income (expense) (17,342) (7,622) (32,264) (11,650) Loss before income taxes (96,532) (160,609) (194,039) (261,287) Income tax benefit (expense) (441) 16 (327) (172) Net loss (96,973) (160,593) (194,366) (261,459) Less: Net loss attributable to non-controlling - - - - interests Net loss attributable to Wheels Up Experience Inc... $ (96,973) $ (160,593) $ (194,366) $ (261,459) Net loss per share of Common Stock Basic and diluted $ (0.14) $ (6.28) $ (0.28) $ (10.27) Weighted-average shares of Common Stock outstanding: Basic and diluted 697,458,966 25,570,200 697,403,388 25,446,199
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