Financial Performance - Total revenue for Q1 2024 was $13,211,000, a decrease of 15.7% compared to $15,665,000 in Q1 2023[13]. - Net loss for Q1 2024 was $17,390,000, compared to a net loss of $7,515,000 in Q1 2023, representing a 131.0% increase in losses[13]. - Basic and diluted net loss per share for Q1 2024 was $0.60, slightly improved from $0.67 in Q1 2023[13]. - The Company generated $13.2 million in revenue for the three months ended March 31, 2024, compared to $15.7 million for the same period in 2023, representing a decrease of approximately 9.5%[61][62]. - Revenue decreased by $2.5 million, or 16%, to $13.2 million for the three months ended March 31, 2024, compared to $15.7 million for the same period in 2023[174]. - The company incurred a net loss of $17.4 million for the three months ended March 31, 2024, an increase of $9.9 million in loss over the prior year[167]. - Adjusted negative EBITDA was $13.1 million for the three months ended March 31, 2024, compared to adjusted negative EBITDA of $6.7 million for the same period last year[167]. Costs and Expenses - Total costs and expenses increased to $29,234,000 in Q1 2024, up 24.0% from $23,578,000 in Q1 2023[13]. - Selling, general and administrative expenses rose by $5.5 million, or 89%, to $11.7 million, primarily due to higher advertising, salaries, and professional fees[179]. - Cost of revenue increased by $129 thousand, or 1%, totaling $17.5 million, with a significant rise in aircraft usage costs[178]. Assets and Liabilities - Total current assets decreased to $39,557,000 as of March 31, 2024, down from $46,498,000 at the end of 2023[11]. - Total liabilities increased to $66,478,000 as of March 31, 2024, compared to $56,961,000 at the end of 2023, marking a 16.5% rise[11]. - Shareholders' equity dropped to $1,694,000 as of March 31, 2024, down from $14,751,000 at the end of 2023, indicating a significant decline[11]. - Negative working capital stood at $11.7 million as of March 31, 2024, indicating liquidity challenges[23]. Cash Flow - Cash and restricted cash at the end of Q1 2024 totaled $8,287,000, down from $16,723,000 at the beginning of the year[18]. - The company reported a net cash used in operating activities of $7,696,000 for Q1 2024, compared to $7,608,000 in Q1 2023[18]. - Cash used in operating activities for the same period was $7.7 million, highlighting ongoing cash burn[23]. - Net cash used in investing activities for Q1 2024 was $56 thousand, a significant decrease from $2.0 million in Q1 2023, primarily due to a $3.8 million sale of equity method investment in the previous year[194]. - Net cash used in financing activities for Q1 2024 was $684 thousand, compared to $5.5 million in Q1 2023, which included $4.8 million from convertible notes issuance and $1 million from a line of credit[195]. Revenue Sources - Charter flight revenue accounted for $11.5 million of the total revenue in Q1 2024, while aircraft management revenue contributed $1.7 million[61]. - Revenue from aircraft usage increased by $4.8 million, or 72%, while revenue from plane sales decreased by $5.7 million during the same period[167]. - Revenue recognized over time from aircraft management services was $1.6 million for Q1 2024, compared to $1.1 million for Q1 2023, reflecting a year-over-year increase of approximately 45%[58]. - Revenue is generated from three primary sources: aircraft sales, commercial strategy including deposit product flights and charter flights, and aircraft management services[198]. Future Outlook - Management believes that anticipated revenue growth and prudent expense management will allow the company to continue as a going concern for at least one year[25]. - The company expects to receive deliveries of 8 to 10 HondaJet Elite II aircraft throughout 2024, which is anticipated to boost future aircraft sales revenue[175]. - The company has incurred significant losses historically and plans to raise additional capital to fund future operations, raising concerns about its ability to continue as a going concern[190]. Investments and Acquisitions - The Company executed purchase agreements with Gulfstream Aerospace, LP for four Gulfstream G 280 aircraft for a total consideration of $79 million, with expected delivery throughout fiscal year 2025[105]. - The Company entered into a purchase agreement for twenty-three HondaJet HA-420 aircraft for a total purchase price of $161.1 million, with deliveries scheduled between Q4 2023 and Q4 2025[109]. - The company has committed to acquire four Gulfstream G-280 aircraft for a total of $79.0 million, with $45 million funded by March 31, 2024, and an additional 22 Honda HA-420 aircraft for $154.9 million, with $1.5 million funded by the same date[196]. Intangible Assets and Impairment - The company reviews intangible assets for impairment annually or when circumstances indicate potential impairment, with significant changes in business climate or operating performance being key indicators[202]. - Goodwill is tested for impairment at least annually, with the next assessment scheduled for October 1, and is not amortized[203]. - There was no impairment loss recognized for intangible assets or goodwill for the three months ended March 31, 2024, and 2023[72][74].
PROOF Acquisition I(PACI) - 2024 Q1 - Quarterly Report