Sky Harbour Group (SKYH) Q2 2024 earnings summary

Executive summary

• Q2 2024 delivered record 109% year-over-year revenue growth, driven by new campus openings, higher occupancy, and premium lease renewals, with San Jose reaching 58% leased and further gains expected.

• Net income for Q2 2024 was $4.2 million, a $5.8 million improvement from Q2 2023, primarily due to an $8.2 million unrealized gain on warrants, while the six-month net loss was $17.0 million due to ongoing development investment.

• The development footprint expanded to 2.4 million sq ft across 14 campuses, with over 1.4 million sq ft in development and 93.7% occupancy as of June 30, 2024.

• Management strengthened with key hires in airport operations, construction, and development to support accelerated growth.

• New ground leases secured at Salt Lake City and IAD, and prototype hangar design completed to drive economies of scale.

Financial highlights

• Q2 2024 consolidated revenues reached $3.6 million, up 109% year-over-year and 50% sequentially, with six-month revenue at $6.0 million.

• Net cash used in operating activities improved to $1.0M in Q2 2024 from $4.4M in Q1 2024, with Sky Harbour Capital reporting $1.1M positive operating cash flow.

• Operating expenses rose 95% year-over-year in Q2, mainly from higher ground lease costs and increased headcount.

• Cash and equivalents plus investments totaled $149.1 million as of June 30, 2024.

• Debt service coverage ratios are being met or exceeded, with compliance as of June 30, 2024.

Outlook and guidance

• Guidance reiterated for positive consolidated operating cash flow by Fall 2025, with expansion to up to 22 airports and eight new ground leases by December 2025.

• Management expects continued investment in construction and development, with ongoing operating losses in the near term.

• Construction cost estimates for APA, DVT, and ADS increased by $26–$28 million due to required retrofits and design enhancements.

• Future debt service coverage ratios are expected to exceed initial forecasts, supporting a path toward investment-grade ratings.