CLEARWATER, Fla., Feb. 12, 2009 (GLOBE NEWSWIRE) -- Avantair, Inc. (OTCBB:AAIR) (OTCBB:AAIRU) (OTCBB:AAIRW), the only publicly traded stand-alone fractional operator and the sole North American provider of fractional shares in the Piaggio Avanti aircraft, today announced financial results for its fiscal second quarter ended December 31, 2008.
Second Quarter Fiscal 2009 and Recent Highlights
* Total record revenues of $35.4 million, up 23.7% year-over-year; * Loss from operations of $0.6 million, down 86.9% year-over-year; * EBITDA (profitable results from operations before depreciation and amortization) of $690,360, up 118.1% year-over-year; * Charter card sales up 96% quarter-over-quarter, to 53 from 27; * Reported delivery of 50th Piaggio Avanti; * Announced new hybrid flight program -- 'Axis Club' -- designed to bridge the gap between the financial commitment of a fractional share and charter cards.
"We are pleased to report an excellent second quarter with record high revenues of $35.4 million, a significant decrease in our loss from operations and our first quarter of positive EBITDA of $690,360," stated Steven Santo, Chief Executive Officer of Avantair. "These results demonstrate the leverage in our business model, and were driven by the consistent growth in our sales pipeline, recent fleet utilization improvements and a disciplined focus on reducing costs. Furthermore, the current market environment serves to highlight our position as the lowest-cost and most fuel-efficient provider in the Light Jet market, attracting an increasing number of customers from competing fractional programs, as they continue to seek a more affordable alternative."
Mr. Santo continued, "Charter card sales also reached a record high, increasing 96% quarter-over-quarter, which is a testament to our continued ability to attract those customers focused on affordability, comfort and safety. As a result, the majority of cards sold were to customers choosing Avantair over more expensive, competing fractional programs. Historically, we have been able to convert approximately 20% of our cardholders to fractional shareowners. We are very excited about our recently launched Axis Club program, which affords customers the opportunity to enjoy the benefits of private ownership while reducing the initial outlay of funds required when purchasing a fractional share. We believe its hybrid and low-cost approach to private travel will enable us to build our sales pipeline and capture a greater percentage of the more than 3,000 light jet fractional owners in the market today."
Conference Call
Avantair will host a conference call to discuss financial results for its second quarter of fiscal 2009 and provide an update on business developments at 5:00 p.m. Eastern Time today. Investors may participate in the conference call by dialing 800-240-6709 (303-242-0007 for international callers). When prompted, ask for the "Avantair Inc. Fiscal Second Quarter 2009 Earnings Conference Call." A telephonic replay of the conference call may be accessed approximately two hours after the call through February 19, 2009, by dialing 800-405-2236 (303-590-3000 for international callers). The replay access code is 11126182#. The conference call will be webcast simultaneously on the Avantair Inc. website at www.avantair.com under Investors. The webcast replay will be archived for 12 months.
About Avantair
Avantair, the only publicly traded stand-alone fractional operator and the sole North American provider of fractional shares in the Piaggio Avanti aircraft, is headquartered in Clearwater, FL, with approximately 400 employees. The Company offers private travel solutions for individuals and businesses traveling within its service area, which includes the continental United States, Canada, the Caribbean and Mexico, at a fraction of the cost of whole aircraft ownership. The Company currently manages a fleet of 52 aircraft, with another 57 Piaggio Avanti aircraft on order through 2013. For more information about Avantair, please visit: http://www.avantair.com.
Forward Looking Statements
This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act, with respect to Avantair's future financial or business performance, strategies and expectations. Forward-looking statements are typically identified by words or phrases such as "trend," "potential," "opportunity," "pipeline," "believe," "comfortable," "expect," "anticipate," "current," "intention," "estimate," "position," "assume," "outlook," "continue," "remain," "maintain," "sustain," "seek," "achieve," and similar expressions, or future or conditional verbs such as "will," "would," "should," "could," "may" and similar expressions. Avantair cautions that forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-looking statements speak only as of the date they are made, and Avantair assumes no duty to and does not undertake to update forward-looking statements. Actual results could differ materially from those anticipated in forward-looking statements and future results could differ materially from historical performance.
In addition to factors previously disclosed in Avantair's filings with the Securities and Exchange Commission (SEC) and those as may be identified elsewhere in this press release, the following factors, among others, could cause actual results to differ materially from forward-looking statements or historical performance: general economic and business conditions in the U.S. and abroad, changing interpretations of generally accepted accounting principles, changes in market acceptance of the company's products, inquiries and investigations and related litigation, fluctuations in customer demand, management of rapid growth, intensity of competition. The information set forth herein should be read in light of such risks. Avantair does not assume any obligation to update the information contained in this press release.
Avantair's filings with the SEC, accessible on the SEC's website at http://www.sec.gov, discuss these factors in more detail and identify additional factors that can affect forward-looking statements.
AVANTAIR, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
ASSETS
December 31, June 30,
2008 2008
(Unaudited) (Note 2)
------------ ------------
CURRENT ASSETS
Cash and cash equivalents $ 7,813,042 $ 19,149,777
Accounts receivable, net of allowance for
doubtful accounts of $137,435 at
December 31, 2008 and $213,487 at
June 30, 2008 6,195,397 5,692,809
Inventory 248,757 252,407
Current portion of aircraft costs related
to fractional sales 40,631,563 40,417,203
Current portion of notes receivable 596,074 832,107
Prepaid expenses and other current assets 1,424,054 2,173,992
------------ ------------
Total current assets 56,908,887 68,518,295
------------ ------------
Aircraft costs related to fractional share
sales,net of current portion 80,774,234 92,383,071
------------ ------------
Property and equipment, at cost, net of
accumulated depreciation and amortization
of $11,777,169 at December 31, 2008 and
$8,989,277 at June 30, 2008 23,764,125 25,663,264
------------ ------------
OTHER ASSETS
Cash- restricted 2,842,550 2,826,290
Deposits on aircraft 10,307,813 8,679,277
Deferred maintenance on aircraft engines 1,595,620 2,228,509
Notes receivable-net of current portion 29,250 1,008,223
Goodwill 1,141,159 1,141,159
Other assets 1,801,850 2,029,367
------------ ------------
Total other assets 17,718,242 17,912,825
------------ ------------
Total assets $179,165,488 $204,477,455
============ ============
AVANTAIR, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
LIABILITIES AND STOCKHOLDERS' DEFICIT
December 31, June 30,
2008 2008
(Unaudited) (Note 2)
------------- -------------
CURRENT LIABILITIES
Accounts payable $ 6,141,865 $ 4,718,355
Accrued liabilities 3,121,184 5,528,472
Customer deposits 1,319,951 1,905,682
Short-term notes payable 11,159,110 15,775,260
Current portion of long-term notes payable 11,049,155 6,648,093
Current portion of deferred revenue
related to fractional aircraft share
sales 48,018,165 47,778,900
Unearned management fee and charter card
revenues 17,783,486 16,316,044
------------- -------------
Total current liabilities 98,592,916 98,670,806
------------- -------------
Long-term notes payable, net of current
portion 16,231,379 23,856,322
Deferred revenue related to fractional
aircraft share sales, net of current
portion 84,606,358 96,525,785
Other liabilities 2,696,107 2,636,730
------------- -------------
Total long-term liabilities 103,533,844 123,018,837
------------- -------------
Total liabilities 202,126,760 221,689,643
------------- -------------
COMMITMENTS AND CONTINGENCIES
Series A convertible preferred stock,
$.0001 par value, authorized 300,000
shares; 152,000 shares issued and
outstanding 14,484,164 14,439,358
------------- -------------
STOCKHOLDERS' DEFICIT
Preferred stock, $.0001 par value,
authorized 700,000 shares; none issued -- --
Common stock, Class A, $.0001 par value,
75,000,000 shares authorized, 15,306,666
shares issued and outstanding at
December 31, 2008 and 15,286,792 shares
issued and outstanding at June 30, 2008 1,531 1,529
Additional paid-in capital 44,740,325 45,314,393
Accumulated Deficit (82,187,292) (76,967,468)
------------- -------------
Total stockholders' deficit (37,445,436) (31,651,546)
------------- -------------
Total liabilities and stockholders'
deficit $179,165,488 $204,477,455
============= =============
AVANTAIR, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(Unaudited)
Three Months Ended Six Months Ended
December 31, December 31,
--------------------------- ---------------------------
2008 2007 2008 2007
------------- ------------- ------------- -------------
Revenues
Fractional
aircraft sold $ 14,372,747 $ 10,646,457 $ 26,866,462 $ 20,450,250
Maintenance and
management
fees 17,702,350 14,148,217 34,779,489 27,122,813
Charter card
and
demonstration
revenue 2,125,787 2,838,803 4,492,012 4,942,186
FBO and other
revenues 1,213,496 996,788 1,952,878 1,769,516
------------- ------------- ------------- -------------
Total revenue 35,414,380 28,630,265 68,090,841 54,284,765
------------- ------------- ------------- -------------
Operating
expenses
Cost of
fractional
aircraft
shares sold 12,323,154 8,921,684 22,928,177 16,969,110
Cost of flight
operations 12,402,387 13,389,081 24,212,790 25,486,596
Cost of fuel 3,061,019 3,915,240 7,573,425 7,606,661
General and
administrative
expenses 5,828,778 4,819,886 11,489,545 9,352,942
Selling
expenses 1,108,682 1,389,470 2,016,434 2,413,326
Depreciation
and
amortization 1,318,256 984,673 2,400,521 1,746,113
------------- ------------- ------------- -------------
Total operating
expenses 36,042,276 33,420,034 70,620,892 63,574,748
------------- ------------- ------------- -------------
Loss from
operations (627,896) (4,789,769) (2,530,051) (9,289,983)
------------- ------------- ------------- -------------
Other income
(expenses)
Interest income 38,404 142,131 25,909 334,853
Other income 300 -- 1,500 --
Interest
expense (1,294,899) (664,625) (2,717,182) (1,149,831)
------------- ------------- ------------- -------------
Total other
expenses (1,256,195) (522,494) (2,689,773) (814,978)
------------- ------------- ------------- -------------
Net loss (1,884,091) (5,312,263) (5,219,824) (10,104,961)
Preferred stock
dividend and
accretion of
expenses (372,104) (167,876) (763,617) (167,876)
------------- ------------- ------------- -------------
Net loss
attributable
to common
stockholders $ (2,256,195) $ (5,480,139) $ (5,983,441) $(10,272,837)
============= ============= ============= =============
Loss per common
share:
Basic and
diluted $ (0.15) $ (0.36) $ (0.39) $ (0.67)
============= ============= ============= =============
Weighted-
average common
shares
outstanding:
Basic and
diluted 15,288,523 15,220,817 15,291,035 15,220,817
============= ============= ============= =============