Blade Air Mobility : Q4 2024 Investor Update Letter

Published: 2025-03-13 07:06:06 ET BLDE

Q4 2024 Investor Update

To Our Shareholders,

We are pleased to deliver our first full-year of Adjusted EBITDA profitability as significant revenue growth and margin expansion in both Medical and Passenger drove a $17.8 million year-over-year improvement in our Adjusted EBITDA in 2024. This important profitability milestone comes as we continued our rapid growth with Revenue excluding Canada increasing 22.1% in Q4 2024 versus the prior year period, while Q4 Flight Profit increased 40% year-over-year and Q4 Adjusted EBITDA rose $4.9 million year over year.

Looking back, it's important to note how much progress we've made with Adjusted EBITDA improving by over $28 million over the last two years. This is only the first step in our plan to generate multi-year, compounding growth in Free Cash Flow and Adjusted EBITDA as we onboard new Medical customers, benefit from underlying growth in transplant volumes and realize continued benefits from Passenger growth, flight economics optimization and our expected mid-term transition to Electric Vertical Aircraft, or what you might refer to as eVTOL.

As we continue to drive further cost efficiencies in our Passenger business, we remain laser focused on maximizing growth in Urban Air Mobility products such as our New York City airport transfer service, which saw high-teens year-over- year revenue expansion in Q4. Services like Blade Airport are key to accelerating and de-risking our planned transition to the next generation aircraft previously mentioned. Overall, this combination of revenue growth and cost efficiencies enabled us to improve on our achievement of positive trailing twelve month Passenger Segment Adjusted EBITDA last quarter, more than a year ahead of our target, by posting $3.6 million of Passenger Segment Adjusted EBITDA for the full- year 2024, an $8.6 million increase versus the prior year.

We have successfully positioned both the Medical and Passenger businesses to benefit from improved economies of scale, driven by our aircraft investments and additional capacity purchase agreements that enable us to use our increasing volumes to drive margin expansion. Our 119.6% year-over-year improvement in Medical Segment Adjusted EBITDA this quarter, on 13.7% revenue growth, highlights the benefits of this strategy.

We're also pleased to report that Q4 was our first quarter with Medical Segment Adjusted EBITDA margins above our 15% near-term target. Though this metric will show lumpiness quarter-to-quarter driven by aircraft maintenance schedules and overall trip volumes, and will dip back below target in the first half of 2025, we're happy to be able to demonstrate the attainability of this goal earlier than expected. The improved performance is driven in large part by our aircraft strategy. Our owned fleet continues to provide much more than just financial benefits, illustrated by our expected launch with two new transplant centers in April, following competitive processes that required direct aircraft ownership.

Early results following our European restructuring have been very encouraging with strong year-over-year revenue growth and solid profitability improvement in the winter ski season to-date.

In addition to our excellent financial results, we made continued progress on strategic initiatives. This week, we announced a strategic partnership with Skyports Infrastructure, a leading provider of ground infrastructure for advanced air mobility, launching a pilot program that will expand Blade's existing by-the-seat helicopter transfer service by connecting the

Q3 2024 Investor Update | 2

Blade Airport - New York City

Downtown Manhattan Heliport and John F. Kennedy International Airport ("JFK"). This will now be an addition to our pre- existing Airport routes to and from the West and East Side of Manhattan and JFK and Newark Airports. The new service will fly passengers transferring to and from flights at JFK, in addition to Long Island and Queens residents commuting to or from Manhattan for business or leisure on weekdays. The facility, located at the southern tip of Manhattan, close to Wall Street, is an important New York City hub for short distance aviation and follows Skyports' recent appointment as the operator of the Downtown Manhattan Heliport, supporting the mandate from New York City officials to transition the heliport from accommodating just helicopters to also supporting next generation eVTOL. As such, this program aims to gather data on consumer demand, flier experience, and logistics specific to the Downtown Manhattan Heliport to provide insights to help accelerate and de-risk the launch of eVTOL operations at the facility.

In March, Blade introduced a new mobile app that offers an enhanced user experience, easy flight booking, flexible payment options, trip management functionality and many more features. We're getting a great response from our customers and, if you haven't yet updated to the latest app, we encourage you to give it a try today.

In Medical, our organ placement service offering ("TOPS") ended the year with six contracted customers and a strong sales pipeline. TOPS has continued to drive additional benefits for our customers and Blade's logistics business, enabling transplant centers to evaluate and, ultimately, accept more organs for those in need. The program also gives us the opportunity to build trust and demonstrate our high level of service to new customers who may choose to utilize our logistics in addition to TOPS.

Working alongside our friends at OrganOx, we are preparing for an April launch of the first phase of our multifaceted strategic partnership. This initial phase will enable transplant centers and organ procurement organizations to utilize OrganOx's metra machine perfusion device on a case-by-case basis. Metra is a perfusion device for the Liver, which represents the majority of the Heart, Liver, and Lung transplants that typically require dedicated air logisitcs. Perfusion technology allows transplant centers to accept more organs for transplant recipients and increase the amount of time organs remain viable outside the body. We are pre-positioning metra devices at key Blade aviation hubs enabling rapid transport to OrganOx customer locations. In this first phase, the metra device will be used for perfusion only at a customer location or in a ground vehicle, however, we are working closely with the OrganOx team to prepare for potential

Q3 2024 Investor Update | 3

future in-flight perfusion: completing aircraft testing and modifications now so that we'll be ready to hit the ground running, assuming metra is approved to perfuse in-flight at a later date.

With respect to our balance sheet, we remain careful stewards of our shareholder's capital, focusing recent investments on aircraft and vehicles that generate great returns for our Medical business, while continuing our evaluation of additional tuck- in acquisitions to expand our logistics platform. With $127 million in cash and short-term investments as of the end of 2024, we believe we are well positioned to capitalize on such opportunities.

Financial Results

Excluding Canada, which we exited in August 2024, Short Distance revenue increased 18% year-over-year driven primarily by growth in New York Airport, Leisure and other US Short Distance. In Jet and Other, revenue increased 85% year-over-year driven by strong flight volume combined with a relatively easy comp versus 2024. We continued to see a significant profitability improvement in Passenger this quarter as Passenger Segment Adjusted EBITDA margin expanded by over 16 percentage points year-over-year to approach break even. This was driven by a 630 basis point improvement in Flight Margin along with an 18% reduction in Passenger Segment Adjusted SG&A. The profitability improvement in Passenger was broad based, driven by improvements in Short Distance, Jet & Other, our exit from Canada and SG&A cost efficiencies.

Medical revenue rose 13.7% year-over-year to $36.4 million. The increase in Air revenue was primarily driven by trip volume partially offset by a reduction in block hours per trip, a natural result of our strategy to increase the size of our dedicated fleet and position aircraft closer to our customers. We continue to believe that this strategy is a win-win, and importantly, the right one for our customers, enabling lower costs and shorter call-out times and this ultimately gives us a pricing advantage versus our competition. Rounding out Medical revenue, ground and TOPS also contributed to revenue growth compared to the prior year period. On a sequential basis, Medical revenue increased about 1% versus Q3 2024, somewhat less than we anticipated largely due to softer industry transplant volumes. Heart, Liver, Lung transplant volumes fell approximately 2% sequentially in Q4 2024 vs. Q3 2024, compared to our expectation of a low single digit increase sequentially.

Blade - Hamptons

Blade Lounge - JRA

Medical segment profitability improved on a year-over-year basis and rebounded relative to Q3 2024 results. Medical Segment Adjusted EBITDA margin improved by over 700 basis points year-over-year to 15.1% in Q4 2024. The profitability improvement in Medical was driven primarily by improved performance of our owned fleet and dedicated aircraft along with lower Adjusted SG&A relative to the year ago period, which had an elevated expense level.

Moving to Adjusted Unallocated Corporate Expense and Software Development. For the full-year 2024, expenses fell 3% year-over-year, but we saw an increase of 12% year-over-year in Q4 2024, partially due to timing of incentive compensation associated with financial over-performance for the year, along with higher legal and professional fees in the quarter.

On the cash flow front, the difference between our Q4 Adjusted EBITDA of -$0.4 million and cash from operations of -$1.8 million in the quarter was primarily driven by non-recurring items including legal and restructuring expenses. Our capital expenditures, inclusive of capitalized software development costs, were $5.0 million in the quarter and driven primarily by $3.2 million of aircraft acquisition payments, while capitalized aircraft maintenance was approximately $1.1 million. We currently have 10 aircraft in operation and we're focused on optimizing the financial performance of the fleet. Given the significant strategic and financial benefits of our owned aircraft, we expect to add a low single digit number of similarly priced aircraft to the fleet over the next year or two. We ended the quarter with no debt and $127.1 million of cash and short- term investments, providing flexibility for strategic investments in aircraft and acquisitions in Medical.

Q3 2024 Investor Update | 5

Conclusion

In summary, we are pleased to have achieved the important financial milestone in 2024 of full-year Adjusted EBITDA profitability and we remain focused on delivering value to our shareholders through disciplined execution towards our strategic and financial targets in the quarters ahead.

Thank you all for your continued support.

Sincerely,

Rob Wiesenthal

Founder and Chief Executive Officer

Use of Non-GAAP Financial Information

Blade believes that the non-GAAP measures discussed below, viewed in addition to and not in lieu of our reported U.S. Generally Accepted Accounting Principles ("GAAP") results, provide useful information to investors by providing a more focused measure of operating results, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making. The non-GAAP measures presented herein may not be comparable to similarly titled measures presented by other companies. Adjusted EBITDA, Adjusted Unallocated Corporate Expenses, SG&A, Adjusted SG&A, Flight Profit, Flight Margin, Free Cash Flow and Free Cash Flow, before Aircraft Acquisitions and revenue excluding the impact of Canada have been reconciled to the nearest GAAP measure in the tables within this press release.

Adjusted EBITDA - Blade reports Adjusted EBITDA, which is a non-GAAP financial measure. Blade defines Adjusted EBITDA as net loss adjusted to exclude depreciation and amortization, stock-based compensation, change in fair value of warrant liabilities, interest income and expense, income tax, realized gains and losses on short-term investments, impairment of intangible assets and certain other non-recurring items that management does not believe are indicative of ongoing Company operating performance and would impact the comparability of results between periods.

Adjusted Unallocated Corporate Expenses - Blade defines Adjusted Unallocated Corporate Expenses as expenses that cannot be allocated to either of our reporting segments (Passenger and Medical) and therefore attributable to our Corporate expenses and software development, less non-cash items and certain other non-recurring items that management does not believe are indicative of ongoing Company operating performance and would impact the comparability of results between periods.

SG&A and Adjusted SG&A - Blade defines SG&A as total operating expenses excluding cost of revenue. Blade defines Adjusted SG&A as total operating expenses excluding cost of revenue and excluding non-cash items and certain other non-recurring items that management does not believe are indicative of ongoing Company operating performance and would impact the comparability of results between periods.

Flight Profit and Flight Margin - Blade defines Flight Profit as revenue less cost of revenue. Cost of revenue consists of flight costs paid to operators of aircraft and vehicles, landing fees, depreciation of aircraft and vehicles, operating lease cost, internal costs incurred in generating organ ground transportation revenue using the Company's owned vehicles and costs of operating our owned aircraft including fuel, management fees paid to the operator, maintenance costs and pilot salaries. Blade defines Flight Margin for a period as Flight Profit for the period divided by revenue for the same period. Blade believes that Flight Profit and Flight Margin provide an important measure of the profitability of the Company's flight and ground operations, as they focus solely on the non-discretionary direct costs associated with those operations such as third-party variable costs and costs of owning and operating Blade's owned aircraft.

Free Cash Flow and Free Cash Flow, before Aircraft Acquisitions - Blade defines Free Cash Flow as net cash provided by / (used in) operating activities less capital expenditures and capitalized software development costs. Blade also reports Free Cash Flow, before Aircraft Acquisitions, which is Free Cash Flow excluding cash outflows for aircraft acquisitions. Blade believes that Free Cash Flow and Free Cash Flow, before Aircraft Acquisitions provide important insights into the cash-generating capability of the business, with Free Cash Flow, before Aircraft Acquisition specifically highlighting the cash generated by our core operations before the impact of discretionary strategic investments in new aircraft.

We have also shown revenue and Short Distance revenue excluding the impact of Canada in this release. These amounts reflect total revenue and short distance revenue, respectively, excluding the activity in Canada in both the current and the prior year periods. The Company discontinued its operations in Canada on August 31, 2024. Management believes that presenting this information enhances the comparability of results between periods.

Q3 2024 Investor Update | 6

Financial Results

BLADE AIR MOBILITY, INC.

CONSOLIDATED BALANCE SHEETS (in thousands, except share data, unaudited)

December 31,

2024

2023

Assets

Current assets:

Cash and cash equivalents

18,378

27,873

Restricted cash

1,269

1,148

Accounts receivable, net of allowance of $112 and $98 at December 31, 2024 and

21,591

21,005

December 31, 2023, respectively

Short-term investments

108,757

138,264

Prepaid expenses and other current assets

10,747

17,971

Total current assets

160,742

206,261

Non-current assets:

Property and equipment, net

30,918

2,899

Intangible assets, net

13,653

20,519

Goodwill

41,050

40,373

Operating right-of-use asset

8,876

23,484

Other non-current assets

1,436

1,402

Total assets

256,675

294,938

Liabilities and Stockholders' Equity

Current liabilities:

Accounts payable and accrued expenses

12,766

23,859

Deferred revenue

6,656

6,845

Operating lease liability, current

3,304

4,787

Total current liabilities

22,726

35,491

Non-current liabilities:

Warrant liability

5,808

4,958

Operating lease liability, long-term

6,018

19,738

Deferred tax liability

185

451

Total liabilities

34,737

60,638

Stockholders' Equity

Preferred stock, $0.0001 par value, 2,000,000 shares authorized; no shares issued and

outstanding at December 31, 2024 and December 31, 2023, respectively

Common stock, $0.0001 par value; 400,000,000 authorized; 79,419,028 and 75,131,425 shares

issued at December 31, 2024 and December 31, 2023, respectively

Additional paid in capital

407,076

390,083

Accumulated other comprehensive income

1,753

3,964

Accumulated deficit

(186,898)

(159,754)

Total stockholders' equity

221,938

234,300

Total Liabilities and Stockholders' Equity

256,675

294,938

Q3 2024 Investor Update | 7

BLADE AIR MOBILITY, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except share and per share data, unaudited)

Three Months Ended

Year Ended December 31,

December 31,

2024

2023

2024

2023

Revenue

54,357

47,478

248,693

225,180

Operating expenses

Cost of revenue

41,768

38,468

189,774

183,058

Software development

743

988

3,184

4,627

General and administrative

18,954

41,242

81,711

95,174

Selling and marketing

1,264

2,413

7,950

10,438

Total operating expenses

62,729

83,111

282,619

293,297

Loss from operations

(8,372)

(35,633)

(33,926)

(68,117)

Other non-operating income (expense)

Interest income

1,590

2,264

7,214

8,442

Change in fair value of warrant liabilities

(3,116)

(1,698)

(850)

2,125

Realized gain from sales of short-term investments

103

Total other non-operating (expense) income

(1,526)

669

6,364

10,575

Loss before income taxes

(9,898)

(34,964)

(27,562)

(57,542)

Income tax benefit

(105)

(1,023)

(255)

(1,466)

Net loss

(9,793)

(33,941)

(27,307)

(56,076)

Q3 2024 Investor Update | 8

BLADE AIR MOBILITY, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands, unaudited)

Three Months Ended December 31,

Year Ended December 31,

2024

2023

2024

2023

Cash Flows From Operating Activities:

Net loss

Adjustments to reconcile net loss to net cash and restricted cash used in Depreciation and amortization

Stock-based compensation

Change in fair value of warrant liabilities

Excess of lease liability over operating right-of-use assets Gain on lease modification

Accretion of interest income on held-to-maturity securities Deferred tax benefit

Impairment of intangible assets Bad debt expense

Other (1)

Changes in operating assets and liabilities: Prepaid expenses and other current assets Accounts receivable

Other non-current assets

Operating right-of-use assets/lease liabilities Accounts payable and accrued expenses Deferred revenue

Net cash used in operating activities

Cash Flows From Investing Activities:

Acquisitions, net of cash acquired

Capitalized software development costs

Investment in joint venture

Purchase of property and equipment

Proceeds from disposal of property and equipment Purchase of short-term investments

Proceeds from sales of short-term investments Purchase of held-to-maturity investments

Proceeds from maturities of held-to-maturity investments Net cash provided by / (used in) investing activities

Cash Flows From Financing Activities:

Proceeds from the exercise of common stock options Taxes paid related to net share settlement of equity awards Repurchase and retirement of common stock

Net cash used in financing activities

Effect of foreign exchange rate changes on cash balances

Net decrease in cash and cash equivalents and restricted cash Cash and cash equivalents and restricted cash - beginning Cash and cash equivalents and restricted cash - ending

Reconciliation to consolidated balance sheets

Cash and cash equivalents

Restricted cash

Total cash, cash equivalents and restricted cash

(1) Prior year amounts have been updated to conform to current period presentation.

(9,793)

(33,941)

(27,307)

(56,076)

1,530

1,806

5,962

7,111

4,526

3,153

19,893

12,501

3,116

1,698

850

(2,125)

(123)

(547)

(622)

(870)

(1,803)

(3,990)

(6,519)

(105)

(1,023)

(255)

(1,466)

20,753

5,759

20,753

167

(8)

335

163

(6)

(55)

(12)

(1,960)

(4,928)

6,352

(6,032)

2,613

125

(998)

(10,254)

(562)

(70)

(42)

164

379

(2)

4,963

(8,338)

9,049

(30)

(119)

117

(1,752)

(9,320)

(2,519)

(32,349)

(2,230)

(459)

(2,119)

(39)

(4,583)

(24)

(30,875)

(2,109)

138

(135)

20,532

(489)

(143,255)

(265,835)

9,500

177,450

264,537

3,976

(1,016)

17,089

168

(3,918)

(30)

(5,683)

(146)

(244)

(3,874)

(23)

(5,759)

(76)

(109)

(80)

(66)

(1,759)

(9,253)

(9,374)

(15,402)

21,406

38,274

29,021

44,423

19,647

29,021

19,647

29,021

18,378

27,873

18,378

27,873

1,269

1,148

1,269

1,148

19,647

29,021

19,647

29,021

Q3 2024 Investor Update | 9

Key Metrics and Non-GAAP Financial Information

DISAGGREGATED REVENUE BY PRODUCT LINE

(in thousands, unaudited)

Three Months Ended December 31,

Year Ended December 31,

2024

2023

2024

2023

Passenger segment

Short Distance

9,133

10,703

72,203

70,700

Jet and Other

8,836

4,784

29,673

27,876

Total

17,969

15,487

101,876

98,576

Medical segment

MediMobility Organ Transport

36,388

31,991

146,817

126,604

Total

36,388

31,991

146,817

126,604

Total Revenue

54,357

47,478

248,693

225,180

IMPACT OF FORMER OPERATIONS IN CANADA ON REPORTED REVENUE

(in thousands except percentages, unaudited)

Three Months Ended December 31,

Year Ended December 31,

2024

2023

% Change

2024

2023

% Change

Revenue

54,357

47,478

14.5 %

248,693

225,180

10.4 %

Canada revenue

(2,942)

(6,384)

(10,474)

Revenue excluding Canada

54,357

44,536

22.1 %

242,309

214,706

12.9 %

Short Distance

9,133

10,703

(14.7)%

72,203

70,700

2.1 %

Canada revenue

(2,942)

(6,384)

(10,474)

Short Distance Revenue excluding

9,133

7,761

17.7 %$ $

65,819

60,226

9.3 %

Q3 2024 Investor Update | 10

Disclaimer

Blade Air Mobility Inc. published this content on March 13, 2025, and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on March 13, 2025 at 11:05:02.173.