Ozenick will be responsible for spearheading the growth and expansion of Volato’s aircraft management business.

“We are thrilled to welcome Mark to lead the expansion of Volato’s aircraft management business,” said Matt Liotta, CEO of Volato. “Mark’s unmatched leadership, dedication to safety, customer-centric approach, and sharp business acumen make him an invaluable addition to our senior management team. I look forward to working with him to scale our already successful aircraft management business.”

Volato said that Mark Ozenick leverages his 45-year career in business aviation, specializing in flight operations, maintenance, and leadership, to deliver a proven track record.

He has a history of success leading Part 135 business aviation companies, where he implemented improvements that prioritized safety, customer service, and profitability.

Prior to joining Volato, Ozenick founded HeliFlite, a leading provider of regional helicopter services. He has also served as a trusted advisor on aviation matters to major airlines and private equity organizations.

“Volato has a unique and compelling business model that delivers exceptional service, safety, and products to its clients,” said Ozenick commenting on his decision to lead VAMS. “Aircraft management is a key part of that model and a differentiator in the market. I look forward to building on this strong foundation and driving further growth.”

Ozenick’s appointment highlights Volato’s commitment to growth and its focus on providing exceptional aircraft management services to its clients.

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SmartSky’s next-generation Air-to-Ground (ATG) in-flight connectivity network is designed to deliver premium performance for every seat on the aircraft. Solutions are available for all sizes of business aircraft with supplemental type certificates (STCs) available and in progress for more than 16,000 in-service models.

Volato aims to exceed customer expectations on every flight, according to Matt Liotta, CEO of Volato. “The addition of SmartSky’s next-generation inflight connectivity is a direct response to customer feedback and underscores our commitment to delivering a superior in-flight experience,” he said. “Early feedback indicates our passengers will be thrilled with the seamless connection and blazing-fast speeds.”

Paul Sameit, vice president of Fleet and Reseller Accounts for SmartSky added: “We couldn’t be happier for Volato and their customers who are now enjoying the benefits of SmartSky when they fly.”

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The company did not book any revenue from aircraft sales owing to push back in delivery dates by OEMs due to supply chain challenges.

However, the company saw strong growth of 72% year-over-year in aircraft usage revenue reaching $11.5m from $6.7m in the corresponding period last year. This was due to 39% growth in flight hours and 7%YoY increase in blended yield. In addition, the company achieved demand mix of 50% owner and 50% program & ad hoc in the first quarter.

Meanwhile, revenue from the managed aircraft segment nearly halved to $1.7m from $3.3m a year ago.

Overall, the company’s first quarter revenue stood at $13.2m, down 16%YoY from $15.7m.

“While OEM aircraft delivery delays put pressure on our revenue in the first quarter, we achieved strong year-over-year growth across our key metrics as we executed on our strategy to drive more favorable demand mix and higher yield per flight hour,” said Matt Liotta, co-founder and CEO, Volato.

In terms of expenses, the company’s cost of services remained relatively stable at $17.5m from a year ago while the first quarter SG&A expenses witnessed a sharp uptick of 89%YoY to $11.7m from $6.2m in Q1 23.  

Volato ended the quarter with $6.4m of cash, and cash equivalents.

The company said it is optimistic on deliveries in the second quarter. “Given the well-known OEM supply chain challenges which have pushed back delivery dates, we continue to expect the delivery of 8 to 10 HondaJets but now expect delivery of two Gulfstream G280s in 2024 [instead of four announced earlier]. These deliveries, including 2-3 HondaJets which we are scheduled to receive in the second quarter, will provide us with an immediate cash benefit as we execute on our backlog of fractional sales,” said CEO Liotta.

Subsequent to quarter end, Volato also signed a term sheet for $14.5m in financing, including a $13.0m financing to unlock deposits for its Gulfstream G280 orders and a $1.5m equity commitment.

“Our aircraft deliveries in 2024 will provide additional cash as well as more capacity to grow our network and better leverage our cost base. With an expected revenue of over $120m this year from fractional sales alone, continued revenue growth from aircraft usage and our cost-savings measures, we expect that we can achieve positive gross margin and EBITDA in the fourth quarter of 2024,” said the company’s CFO Mark Heinen.

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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.

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“In 2023 alone, Volato expanded its HondaJet fleet by 50% and increased its light jet market share to nearly 3%. This is a testament to Volato’s focus on delivering operational excellence while growing positive contribution margin from flight operations,” said Mark Heinen, CFO, Volato.

“Even with this tremendous growth, we maintained our emphasis on providing high quality customer experiences. This is evident in the consistency of our overall Net Promoter Score and validates the investments we continue to make in this area to create ongoing value for our customers.”

As per the data published by the company, Volato booked 11,273 total flight hours during 2023, an increase of 124% from last year.

The company also provided the net promoter score (NPS) for the quarters during 2023. The company said that “customer satisfaction drove a Net Promoter Score of 86 or better throughout FY 2023, while its ability to grow its share of the light jet market is indicative of Volato’s expanded market penetration.”

To note, the company’s NPS during the first, second and third quarter of 2023 was 86, ,89 and 90 respectively.

Earlier, the company announced it had successfully expanded its fleet by 50% to a total of 24 HondaJet aircraft by December 2023.

The expansion includes three new aircraft delivered in December – two from direct Honda deliveries, and one managed plane, taking the total to eight aircraft additions in 2023.

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The expansion includes the addition of three new aircraft delivered in December – two from direct Honda deliveries, and one managed plane, taking the total to eight aircraft added in 2023.

“Volato’s measured and thoughtful approach to fleet expansion is critical to achieving our long-term plan for sustainable growth,” said Matt Liotta, Co-Founder and CEO, Volato.

“We have been creative and judicious in acquiring HondaJets through the open market while continuing to receive new aircraft from our HondaJet factory order. The recent deliveries allow us to expand our capacity at a pivotal time in Volato’s growth and increase our capacity to support our growing customer base.”

New aircraft delivery from Honda contributes to keeping Volato’s fleet one of the youngest in the industry. Fleet modernity allows Volato to ensure heightened reliability and efficiency.

Moreover, Volato expects to add addition 10 HondaJet aircraft to its fleet in 2024.

In addition, The company has also signed a letter of intent with HondaJet for its new Echelon aircraft which will be the first light jet capable of transcontinental flights.

Meanwhile, Volato recently completed its SPAC merger with Proof Acquisition Corp. (PACI) and began trading on the New York Stock Exchange under the ticker symbol SOAR. It raised new capital to over $60m – together with the conversion of Volato’s convertible debt. The company boasts of a strong revenue base diversified across its offerings.

In 2022, it reported revenue of $96m – mostly from its fractional ownership ($45m) and aircraft management ($35m) business. The remaining $16m came from the company’s jet card programs.

The post Volato adds eight new aircraft to its fleet in 2023 appeared first on Corporate Jet Investor.

He incorporated, the fractional jet and charter company, in January 2021. Two months later he ordered HondaJets. Volato took delivery of its first aircraft in August 2021. Last week the company went public on the NYSE American after less than 2.5 years of flying. He wanted to list the company to help Volato grow faster.

“We believe that this transaction provides not only the capital to accelerate our fleet growth and strategy, but also a level of transparency and institutional support that should make our product even more attractive to new fractional owners and private fliers,” said Liotta.

Volato has a fleet of 23 HondaJets and has 24 firm orders. This includes four Gulfstream G280s coming next year. It had sales of $96m in 2022 – helped by new fractional aircraft sales.

The company has three types of customers: fractional owners, jet card members and ad hoc charter customers. Volato has an innovative offering for its fractional owners – they can use the aircraft as much as they want, with special owner rates, or share in revenue from charter.

The company has bases in southern California, Georgia, Massachusetts, Texas and two in Florida. It acquired Gulf Star Aviation in March 2022 to establish itself in Houston and plans to copy this in other markets. Its next targets are Colorado, New York, Chicago, northern California and the Pacific Northwest.

After listing Volato announced a new partnership with Fly Alliance to give owners access to larger aircraft. It also launched a new partner benefits programme with companies including Spa company Canyon Ranch, concierge firm Quintessentially, Goss RV, Lacure Villas, online poker PokerGO; spirits supplier ReserveBar; Hertz and others. 

Volato follows Wheels Up and Jet Ai. The next business aviation operator set to be listed is flyExclusive, which has also moved its focus from charter to fractional. Its SPAC has delayed its shareholder meeting from December 5th to December 19th.

Liotta stresses that SPACs have moved on from the first wave. He always planned to float the company (it is the second company he has taken from launch to listing) and believes that transparency is good for business aviation.

At CJI Miami this year, Liotta stressed this. During a panel he commented on an answer made by George Mattson, CEO, Wheels Up the day before.

“He made a joke about having your financials exposed for everybody to look and I think that is a really good point,” said Liotta. “It is easy to beat up on people who have their financials transparently out there. The question is what about other people who don’t have theirs out there?”

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SPACs or “blank cheque companies” as they are often called, emerged as a promising vehicle for private companies to go public in 2020. The appeal of SPACs lay in their speed and efficiency, allowing companies to go public more quickly and with less regulatory scrutiny than a traditional IPO.

However, investor sentiment in the private aviation space for SPACs has changed over the last two years. Mostly due to the mediocre performance of companies that took the SPAC route for listing. Share performance of WheelsUp and various advanced air mobility companies have put a big question mark on whether SPACs are the right way to go about raising new funds for aviation companies looking to expand their operations.

These questions have prompted some business aviation companies to shelve their plans to pursue the SPAC route for listing.

But despite these concerns, Volato went ahead with its Proof Acquisition Corp. (PACI) SPAC merger and began trading on the New York Stock Exchange under the ticker symbol SOAR. In addition to the merger, PACI also closed an additional $12m in private investments and $14m in Series A Preferred Equity financing.

This brings the total amount of new capital raised by SOAR, operating one of the world’s largest HondaJet fleets, to over $60m – together with the conversion of Volato’s convertible debt. Following the merger, SOAR stock went up 88%. A lot of the merger’s success had to do with Volato’s approach to private aviation and their asset-light business model.

The company boasts of a strong revenue base diversified across its offerings. In 2022, it reported revenue of $96m – mostly from its fractional ownership ($45m) and aircraft management ($35m) business. The remaining $16m came from the company’s jet card programs.

Volato’s business model is simple. Bring the benefits of whole aircraft ownership to the fractional customer, while filling residual fleet capacity with in-house software solutions.

“I think what’s most unique about us is that … our fleet focus is entirely on light jets, with the HondaJet. And we’re also unique in that our fractional program allows for unlimited use and revenue share, which is a departure from the typical fractional ownership,” said Matt Liotta, CEO, Volato while speaking at the Corporate Jet Investor Conference in Miami. But why HondaJet? “I specifically went on a journey to find what I thought would be the best, most efficient, jet for four passengers or fewer. That’s what we saw as a market opportunity. We had a limited number of airplanes to look at, and we thought the HondaJet made the most sense for that.”

Consumers are also looking for flexible solutions. With private flight costs skyrocketing during the last two years, selling less costly seats on efficient jets hits the bullseye for users. And high interest rates have become a major consideration for consumers looking to invest.

“One of our unique aspects is that we’re an asset-light company, so we don’t own any planes. So, interest rates aren’t affecting us, in that sense. I think it affects our customers and, their considerations when making, investments in any space, including, this one. So, it’s certainly a consideration for our customers,” says Matt.

Volato’s fractional ownership and revenue sharing puts it in a perfect spot to earn higher market share in the current high interest rate environment.

The company currently has 25 aircraft in fleet with 27 on order (including 11 HondaJets and four Gulfstream G280s scheduled for delivery in 2024.) Volato says its solutions address major pain points in private aviation. High operational costs and restrictive jet plans for consumers are matched with Volato’s flexible fractional ownership model and incentives for customers.

With an asset-light business model and ample liquidity from the recent merger, Volato’s management is focused on targeting the consumer segments which need two-to-four seats and fly for two-to-three hours. Volato’s management says they does not want to become the Uber of private jets. They have a clearly defined market, and they are focused to tap into it while keeping costs in check and efficiency at maximum.

“I think really matters like how much you’re flying; how much you’re contributing to market share and what your growth rate is. And so, for us, we’re a very high growth company that is looking to be a dominant player in the light jet space,” Matt added.

“We’re growing very fast. October 2023 was our best month ever. Since I was here last year, we’ve more than doubled our utilization of owners of deposit card customers of charter. So just everything is up for us.

“We think, as far as we can tell from the data that we’re taking market share.”

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Heinen joins as Volato is set to merge with PROOF Acquisition Corp as Special Acquistion Company (SPAC).He has experience of taking private companies public as CFO of Better Therapeutics.

“Mark’s proven track record of executing financial strategies and driving profitability makes him the perfect addition to our executive team,” said Matt Liotta, CEO, Volato. “We’re confident that his leadership will contribute significantly to our mission of providing exceptional private flying experiences.”

Volato is expected to merge in the next few days.

“Volato is an exciting opportunity to join another high-growth company that is disrupting the private aviation industry,” said Heinen. “The company has positioned itself for continued growth in the high-demand light jet market and I’m eager to take the reigns as it pursues becoming a publicly traded company.”

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Today (Wednesday August 9th), Wheels Up will report its second-quarter results. The first-quarter announcement was overshadowed by the departure of founder Kenny Dichter as CEO. This time the numbers will get much more scrutiny.

Many will focus on how much cash it has. At the end of March, it had $363m. It could be getting close to breaking debt covenants. We will find out more soon.

The company had record first quarter sales and its new strategy of focusing on two regions looks sensible, but 12 weeks is not a long time to implement it, especially for a membership business. Wheels Up does still have some supportive large investors – especially Delta Air Lines, which owns 20%.

Wheels Up launched in a market when investors were happy to support what were called pre-profit companies (and many pre-revenue ones). It was unlucky that this mood changed before it became profitable.

But it does make you ask: why would any business aviation firm want to go public today? Surprisingly, a lot of companies do.

Last week Volato, the fractional operator with a fleet of 25 aircraft, announced plans to merge with a SPAC. Jet AI (formally Jet Token) is likely to become listed this week. North Carolina charter operator flyExclusive is still in the process of listing. Set Jet, which has access to a fleet of five Bombardier Challenger 850s, is hoping to merge with a SPAC by the end of the year.

These are very different businesses. And have very different motivations in listing. (Pictured is the New York Stock Exchange building).

Matt Liotta, Volato’s founder, accepts the risks in becoming public, but says there are real benefits. “One of the benefits of being public is the increased transparency for customers and prospects,” he says. This is also a good thing for a market where it is difficult to get hard data.

They are going public at a time when demand for business aviation is cooling from its post-lockdown highs. Private Jet Card Comparisons says that hourly jet card rates fell 1.3% in the second quarter of this year, after a 5.2% drop in the first three months.

“The overall market is cooling,” says Liotta. “Charter traffic is down and private traffic is down but fractional is up compared to last year. We are not a typical fractional company and are seeing strong demand.”

Kenn Ricci’s FlexJet has stayed private. In October last year Flexjet announced a merger with a SPAC sponsored by long-term investor and partner Todd Boehly. This was cancelled in April citing market conditions.  Last week Flexjet acquired Flying Colours to bring more maintenance – especially completions – in-house.

Flying Colours received strong interest from a mixture of strategic and financial investors (it was advised by Jefferies). The fact that it was not listed is arguably an advantage when closing deals.

Spare a thought for Surf Air Mobility which became public through a direct listing on Thursday July 27th at $4.60. It is now at $1.50. Surf Air is a very different business – relying on small aircraft and certification of electric aircraft – but now is not a fun time to be running it.

SPACs get a lot of criticism but the fact they typically launch at $10 is useful.

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