Global Crossing Airlines Group Inc. (JET) Earnings Call Transcript & Summary

Good afternoon, good morning, depending on where you are. Thank you for joining us for this management update with Ed Wegel, the CEO; and Ryan Goepel, the CFO of Global Crossing Airlines. It's been a few months since the last update and a significant amount has been accomplished. And with that, I'll turn it over to Ed. And it will be very, very clear to everybody where you come from and where you're going in a very short period of time.

We are going to see the investors up there? Thanks, Grant, and thanks for everyone attending this webinar today. Good afternoon, good morning, as Grant said. As mentioned, we purposely have not held any webinars over the past few months. We wanted to get through third quarter, which saw us go into revenue operations, add some aircraft and get our operations settle down and get us into a pattern. We've tried to keep everyone as informed as possible through the last few months, as you know, with press releases and social media that's not as effective though as these investor webinars. And so we will start doing these on a regular basis, again, now that we're deep into our ramp-up period and our operations are ongoing. We thank you for listening in today. And as Grant mentioned, we've made a tremendous amount of progress since we completed our 121 flag certification in August, which was about 4 months ago. That seems like a lot longer given everything that's gone on, but it was a mere 4 months. So we got through quarter 3. And we've been through most of quarter 4 now. So there's a lot that we need to discuss and show where we've made progress on our ramp-up period. And we're going to take you through that progress today in a number of areas. We're going to go through strategic goals and objectives for this quarter. And next quarter, we're going to walk through our operations in terms of our fleet management and our basis, going to as much as we can talk about revenue where that's coming from and how we are growing that, some finance initiatives and then a summary. But first, I want to talk about where we are today because I think that's quite important and quite impressive given where we came from and where we end since certification. So where we are today in terms of our certifications and permits? We are a 121 domestic flag and supplemental carrier, full DOT international authority. And over the last few months, we have worked with the governments in Canada, Mexico and Brazil and now have full operating permits to be able to operate into those countries, which is quite significant for us for Canada because of our relationship with Canada Jetlines, into Mexico and Brazil because those are big markets for charters and other clients who need to get to those locations. Our aircraft fleet as of today, 3 aircraft on our operating certificate to A320, A321. 3 aircraft will be added to the certificate in Q4. In fact, 1 airplane an A320 will be added later today or early tomorrow. The second of the 3 aircraft will be added to the certificate later this week, and a third aircraft, another A320 should be delivered to us out of paint in a few weeks and will be added to the certificate by mid-December. We also have 1 aircraft slated now for delivery by March 1 of next year. We were originally going to take delivery of that airplane late in December. It was like coming out of the former operator, Alaska Airlines, so we pushed that 2 months, but that actually works well within our operating plan. We also have 3 cargo aircraft now on lease agreements that will be delivered out of conversion. All of these next year, August, October and December, and we are working to try to get at least 1 more cargo aircraft delivered in 2022. So let's take a look at the fleet. We often talk about about these aircraft as inanimate objects, they actually real, they are big, they are expensive, and we have a great operating team that can operate these airplanes. N276 that was our first airplane delivered in January of this year, 11 months ago. That airplane is doing heavy service now for the U.S. government and for some of our clients in the Southeast. N277, our A321 was delivered in March of this year. We used it in Afghanistan along with 276. It was placed on the certificate after return from Afghanistan and we went through the certification process and the evacuation demos. That airplane is now doing heavy service into Cuba and into the Caribbean, a lot of calls for it because of its size and number of seats and its cargo capacity. And we are actually looking for another A321 passenger airplane for delivery next year because of the passenger and client demand for this airplane. 278GX is here in Miami. It is the aircraft that will be placed on the certificate later today. It has been conformed. We're waiting for some final paperwork from the FAA. 279GX was delivered earlier this quarter. It comes from Avalon, the big leasing company. That airplane has got a great interior and it's very popular among some of our clients, and it's out doing a lot of heavy work right now for the government as well as a number of football teams and other clients in the Sports area. As well, we have 281 and 282 GX, 282GX is now out of paint. It will be flown to Miami tomorrow. It will take a few days for it to be put on the certificate but it is already booked for charters starting next week. So we're looking forward to bringing that airplane here tomorrow or no later than Thursday. 281 GX has just been delivered to the paint facility, 282 GX was pulled out, 281 pulled in, and it's now being painted. So that will be delivered to us in 10 to 12 days after it goes through the paint process. We had 280 GX will be delivered to us, as I said, March 1, 2022. And 283, we're looking at a delivery sometime in April or May of 2022. So that will bring us to 8 aircraft, one A321, 7 A320s by the summer of 2022. That is as fast as we can grow. We have to train crews. We have to get authority from the DOT. We have to ensure that our infrastructure in terms of people and assets is in place here at the company for the FAA to approve our expansion. We don't see any issues with that. but that does take time, and it does take some work for us to get ready for these additional aircraft. As well, we have 3 cargo aircraft, as I mentioned, 3 A321 freighters coming to us in actually August and September of 2022 and 1 by November or December of 2022. All depends on the amount of conversion time required to convert those airplanes to freighter. We have a total of 9 now under firm lease or LOIs for the fleet. We are about to get 2 more subject to Board approval. We continue to work to tie up A321 freighters, which we know we have a very hot commodity in the cargo market in the years to come. Our operating bases, we continue to expand those. Miami now is fully operational, and we have Global X ground team, our wholly owned subsidiary, ground handling our flights here in Miami for Santo Domingo, Cuba and other flights that we have departing from Miami. ACI, Atlantic City, New Jersey is now a fully functioning flight attendant base. Our second flight attendant class Atlantic City is actually here in Miami during their final week of training. They will graduate early next week. We are already looking at positioning an aircraft there in Atlantic City, given the number of charters and the demand that we see out of the Northeast. For Las Vegas base planned for opening January 1. Our first flight attending class will start in Las Vegas in the next few days. They'll graduate just before Christmas. We'll then have a second class starting in Las Vegas soon thereafter. We've got a base supervisor. We're starting to ramp up for operations there. We've already gotten requests for charters from some major clients with airplanes operating out of Las Vegas starting in the first quarter. So we're very very pleased with the development of those bases, and I'll talk about why we have done that in a moment. Our Fort Lauderdale major maintenance complex planned in finance for May 2023 opening. That continues. We have the financing in place for that. We're working on the designs and the engineering studies for that, and we want to push ahead with that in early 2022. But that will give us a maintenance complex where we can do work up to C checks and give us a home for our maintenance providers, which is extremely important for us as we move forward and expand the size of our fleet. Team members now in the headquarters, 42 members pilots are at 33. We will have -- we have 2 classes starting. So we'll be up in the mid- to high 40s in the next month, 72 flight attendants amongst the 3 bases and a maintenance team of 26. This staffing is required for us, both with the FAA and DOT to show that we have the infrastructure in place to operate up to 8 aircraft. So we have taken the decision to put those team members in place, get them trained, get them acclimated and get ready for the airplanes as they get delivered. So we're well along the path in ensuring that we have the infrastructure in place for the airplanes that we have coming. As well -- and as you know, we spun off Canada Jetlines earlier this year. GlobalX maintains a minority stake of 25% of Jetlines worth today approximately $5 million. We will do cross-marketing between Canada Jetlines and GlobalX. And in fact, we will start flying for Canada Jetlines in advance of them receiving their certificate to take advantage of the Canadian winter traffic to South Florida starting in February, mid-February for a period of 6 to 8 weeks. This will allow Canada Jetlines to get their name out into the Canadian market, gets us some extra utilization on some aircraft and starts the complete alliance between the 2 airlines. As well, and I just mentioned GlobalX ground team 100% owned by GlobalX in partnership with Global Aviation Services, which provides our ground support equipment. This will continue to grow over time with global -- with ground team handling other airlines as well as GlobalX. We now have established operations for ground team handling GlobalX both Miami and Tampa, and we are looking at expanding ground team now with some external financing to other locations around the U.S., both where GlobalX will fly as well as where we will not fly. So we see this as a major revenue opportunity for us to have a ground handling operation that is somewhat independent of GlobalX but provides all of our ground handling and will handle other airlines. As well, and you may have seen our press release from today, Flugy is now up and running. We've just signed a major partnership deal with Soho House major leading global hospitality brand. And we believe that Flugy will be a source for demand for charters that will be flown by GlobalX both for Soho House, which could be as many as 10 to 15 to 30 charters a year as well as other clients in that space and as well what Flugy does, which is to create a crowd-sourced demand for charter travel. We will be looking to bring in outside investors now that we have proven the concept, and this will be a major asset for the company as we move forward. Let me talk a little bit about our goals and objectives for this quarter. We're in the midst of completing a very extensive budget process for 2022. We've set our cost reduction goals now as we are up and running, and we are approaching some scale with up to 6 aircraft operating. So we are reducing consultants and other outside advisers. We are trimming where we can. We're getting the airline ready to fly. We've also established a quarterly review process, and that will be ongoing through the year. Also in Q4, as I've previously stated, we will receive conform and place 3 A320s onto our certificate. That will actually be done by December 15. And first 2 airplanes of the 3, as I mentioned, will be done within the next few days. We're also working to finish the complete IT integration across the company to eliminate all the paper -- We're about 90% of the way there. We're going to finish this in Q4. Everything in this company is now digitized. We've got a few final tests that we have to automate but that will be done by the end of this quarter. We're also reviewing every vendor, maintenance, IT, crew training, all across the company now, and we're starting to renegotiate with vendors as they say that we are viable. We have cash in the bank. We have airplanes and we are a survivor. So now we can go back to each 1 of those vendors and start to renegotiate and cut costs where we can. We're continuing to expand our broker outreach, the charter broker community and all of our relationships. We had a very successful IMAX conference in Las Vegas, and I'll talk about brokers in a moment when we get to some of our revenue slides. We're also preparing to receive a SmartLynx aircraft to supplement our winter flying. This is part of our alliance with SmartLynx. SmartLynx has been a great partner of ours. They own about 8% of GlobalX. We need 1 of their aircraft to supplement our flying to back up some of our flying, and this is the start of an 8-year exchange process with SmartLynx, where we will send airplanes to them in the summer, and they will send airplanes to us in the winter. It's very countercyclical between the 2 airlines, and it's a very comprehensive cohesive plan we have with them to exchange aircraft. And we're in the midst of completing our first employee performance review. Many of our managers have never been through this. We're teaching them how to do it. We're mentoring them, and we're putting in place a full performance review for all of our team members. In the first quarter of 2022, we have a number of objectives. One of the primary ones is an uplift to NASDAQ, which Ryan will speak about in a few moments. On the passenger side, we want to make sure we have a seamless operation with SmartLynx to develop and enhance our 8-year deal. We want to fully open our crew bases in Atlantic City and Las Vegas and have both pilots and flight attendants headquartered or domiciled in those spaces, and we will take delivery of another A320, as I mentioned, around March 1, from DAE, a major lessor who provided us our first aircraft. On the cargo side, we'll oversee the induction of 2 of the first A321s for conversion in January, the first one, it will be start its conversion at HAECO, a major engineering firm and the second 1 will start in February in San Antonio, Texas with ST Engineering. We're looking very forward to seeing those 2 airplanes start the conversion process. We will also start the certification process with the FAA, and we have now targeted with them and their team that's been assigned to us to do this with our first submission of manuals on or about the mid part of January. And that's our target date to get our first submission in. This is so that we will be ready through the process for the first aircraft, first freighter to be delivered to us in August, so we can start the proving runs with that airplane. Let me talk a little bit about why we have 3 bases and why we put them, where we put them. One of the advantages of having several bases is that we can more effectively compete for Charter activity of charter quotes, charter proposals and actual charters. If we can have airplanes spread throughout the U.S. at basis where we can limit the amount of ferry time required to get to a client. So we, of course, started in Miami with our name base. We have now opened up Atlantic City, where we can quickly and efficiently move aircraft to charters in the Northeast and Midwest. And now we're opening Las Vegas where we can effectively compete. For California, West Coast charters, all up through the ski areas and so forth. So if you draw a 3-hour range circle from each of those bases. You can see that we cover all of the Americas down to the northern part of South America, but we can efficiently move aircraft and have aircraft available for charter clients within a very short ferry time period, which is critical for us as we compete for charters. We talked about our alliance both with Canada Jetlines and with SmartLynx. We call this our global presence, local focus campaign with the 3 tails. With SmartLynx, as I mentioned, we will receive an aircraft from SmartLynx early next year that they will operate for us on some routes that we have already determined with clients. They will also provide backup aircraft for us so that we can more tightly schedule our own fleet. We will also provide A320s to SmartLynx starting next summer, and we're cooperating on A321 freighters. So we are exchanging information and data SmartLynx is educating us on their operation of the A321 freighter to date. They're currently operating 2 and they will get 2 more freighters very soon. So that cooperation is very helpful to us particularly as we negotiated our deals on the freighters, their input and their advice was critical for us to get very, very efficient deals done with the lessors. Our Jetlines Alliance, also very, very important to us. We own a major stake in Canada Jetlines. We will start flying in Toronto, Miami, Toronto, Fort Lauderdale pattern for them. starting in hopefully February, maybe a little later in February, but this will give them 8 weeks of exposure with their name and brand in the market and get us additional flying. We're also providing technical assistance to them for their aircraft acquisitions, and we're helping them -- they're working with our client Havana air to potentially launch Toronto to Cuba flights with their own aircraft. So both of these alliances are very, very important to us. It broadens our scope and our presence. And we're now talking to several smaller South American airlines in an effort to expand this lance to include aircraft that we can access in the South American market. We've also strengthened the management team through this quarter. It's our intent to continue to supplement and augment our management team as our operation gets larger and more complex. Jeff Sonic has joined us. He works for Ryan Goepel and the finance shop. Jeff comes to us after many years at Atlas Air, Atlas 1 of our comps, an airline that we frankly look up to, and we look to see how they operate. They operate widebody aircraft, but they are very much in the operating mode that we are in -- And so we've learned a lot through Jeff on our finance systems and how we do accounting for charters and other areas of our business. And so he is leading the current budgeting process and quarterly review processes and as well working with our sales and marketing team as they develop charter contracts to make sure that we are covering everything we should be covering in our contracts as Atlas ever does. Marcus Schleich has joined us as VP of Maintenance and 1 of our 119. The gentlemen who had occupied that position is now retired. He got us very successfully through the certification. We were sorry to see him go, but he did a great service for us. We were able to place him with Marcus, who has got tremendous experience with a number of airlines, including Atlas, including a number of airlines that operate the A320. And comes very highly recommended from the FAA. They are very happy to see him here with us as well as Kevin Bitzel, who joined us as our Chief Inspector. Kevin, has many years of inspection experience which is critical in this role, heavy maintenance inspection experience at MROs, both inducting aircraft into a fleet as well as returning aircraft to lessors Kevin comes to us from Frontier, which operates the A320. He knows the A320 inside and out and is a tremendous asset to our team. As well as we expand our operations in our stations, and our ground ups and also in flight. We're bringing in Darien DeBestino. She has extensive experience having been on the start-up teams at Virgin America, JetBlue, and Breeze recently, where she ran station operations as well as in-flight. She's also had major VPs at some major airlines, including Emirates, and Hawaiian. And so we are very fortunate to have her come on board with us to help strengthen our ground ops team and help on the in-flight side of our options. As we look at our fleet plan, we're often asked how many airlines do you think you can get to. As part of our goals and objectives, we are looking now at 25, the passenger aircraft, 25 cargo or freighter aircraft by the year-end 2025. So 50 aircraft total. We are on a path to do that. We are continuing to see good deals for aircraft. As a result of the pandemic, we're moving fast to line up those aircraft because that situation will eventually change. But we are focused on the 320, the 321. Again, COVID has created a unique opportunity for us to line up these aircraft, and we're working very hard to line up the 2022 fleet as well as 2023. In 2022, we would like to take as many as 5 additional passenger aircraft in addition to the 3 freighter aircraft that we'll take. If we can take more aircraft, we will because the deals are there, the aircraft are there. We have to make sure that we've got the clients to fill those airplanes and that we've got the infrastructure in place here in terms of pilot recruitment and other infrastructure that we need to support that growth. But this is our goal, 50 aircraft by the year-end 2025. We called the 25-25-25 plan, and we think it's realistic and it gives us the opportunistic growth that we need. A couple of other initiatives. These are still an inboard review as well as some other initiatives. But these give you an example of the types of things we are looking at now to continue to reduce our costs and increase our margins. We're looking to purchase our own flight training device a Level 5 device that we place in the Airbus facility here in Miami. It does a number of things for us. It saves us money in terms of crew time. We can operate the Level 5 SIM for about 40% of the hours that we now use the full flight simulator for. It also gives us and probably more importantly, flexibility in scheduling. So this device, obviously, we would own it and the scaling of that device is completely in our control. Right now, we are a bit at the mercy of the training facilities here in Miami and their ability to provide a simulator time. We want to move away from that as much as we can and control our own destiny when it comes to training. As well, we're working with GA Telesis, which is a major, major MRO facility with worldwide operations. We are very close to their management. They have been very supportive of us. We are now working on a plan to buy some airframe A320 airframes that can be torn down, their parts and components put on the shelf. In some cases, they may need to be repaired. But given the cost of airframes, we think that there's a big arbitrage between what we can buy for and what we can put on the shelf and what we could eventually sell some of these parts, those parts that we don't need. And so it's really a cash-neutral type of situation, particularly since GA Telesis will finance the entire deal from acquisition of the aircraft frame to stripping it down, repair and components and doing all the other activities around that. So we are starting now to look at creative ways for us to reduce our costs increase the control of our operation by having our own parts, our own main base kits here at MIA as well as our own flight training devices so that we can control our own destiny when it comes to flight train. Let me turn this over to Ryan now will take us through the next slides.

Great. In round to our block ours available for sale. Our primary constraints that relates to revenue does relate to how many aircraft we have to sell. As you can see in August, September, we effectively had 1 aircraft in August and 1.9 aircraft available in September. As we disclosed, we did around 370 hours of flying in Q3 with those -- with that aircraft, generating about $3.1 million of revenue. We did highlight in the Q3 results a loss of $5 million, but over 60% of that contributed to performance flying and also related to the ramp-up as we were adding planes in Q3 -- in Q4. Looking forward to Q4, as we mentioned in our press release, we'll see a approximately 270% increase in our capacity for flying, which again has been our primary constraint as it relates to revenue growth. And we see that growing not only in Q3 and Q4, but also in Q1. We'll now turn over to Ed to some of the customers we're looking forward.

Talking you through some of this, it's important for you to understand the breadth and depth of the clients that we are flying. We have a large portfolio now of collegiate sports clients that were flying both for football and now into basketball and baseball. In fact, we have 1 whole aircraft that will be dedicated with WiFi to that market started in January of this year. On the tour and travel side, we've talked about our Havana operation or Cuba operation with Havana Air which is the largest OFAC approved tour operator in the U.S. And we're currently operating 10 flights for them. We started with 8. We're now at 10. By mid-December, we should be at 12 to 14 flights per week. And in January and February, that should ramp up even more so. We're only flying to Havana right now from Miami and Tampa as the other cities in Cuba open up. Those include Cambay, Santa Clara, Santiago and so forth. We will fly those for a and we expect to eventually get to as many as 44 flights per week from Miami and Tampa and perhaps were to other U.S. gateway cities to Cuba, 44 flights per week to Cuba, the main cities in Cuba. We're also flying in a joint venture with Terpel Airlines to serve the Venezuelan market over Santo Domingo, and we've started a major program with Agua Caliente, a casino operator on the West Coast as we put more -- put 1 airplane and then a second airplane into Las Vegas, that particular joint venture will expand. We also are in discussions with all of the casino operators not only in Las Vegas, but Atlantic City and Mississippi and so forth. And we expect we will get a fairly good amount of business out of all of the casinos, and that portfolio will build over time. On the government side, we have done a number of flights for NASA are going into French Guyana, where they are preparing to launch what is -- will be the replacement for the Hubbell telescope. We're flying another flight for them in the next week or so, and we see that relationship with NASA expanding over time. They're a very good client, and we performed very, very well for them. And as well, we work with the Department of Homeland Security to provide them aircraft and seats that they need for their various activities. I mentioned the broker community, which is very, very important to the Air Charter or Charter Airlines side of the business. We work with all of the major ones now, ACC, Air Charter service, Chapman Freeborn, which is a subsidiary or affiliate of SmartLynx and their conglomerate air charter service, Hunt and Palmer. Private jet services, which we're now in midst of negotiating a major expanded contract with them, sports and entertainment, travel and some others. So they've been a source of a great deal of this for us. They provide a lot of potential deal flow for us. We performed well for them, and we will continue to expand our relationship with all of them as we move forward. mentioned Havana Air, very, very important customer client of ours. As I said, we operate a 6 a.m. departure every morning for them to Havana from Miami. And we'll continue to build that relationship with additional flights. And again, we expect to get to as many as 44 flights per week with them by summer of 2022. We talked a little bit about Flugy and Soho House. We think that this is a prime example of the marketing creativity we have here at GlobalX to expand what is the natural charter market so that we bring in more clients and more opportunities for flying. So plugging is presented to us as a concept. We grabbed onto it. We expanded it. We put some development hours into their software. We then working with some local marketing experts. We're able to get a deal done with Soho House, which is a major worldwide luxury brand. And so with Soho House, we'll be doing the first flight in January marine promotion with -- So House of GlobalX and Flugy at Arc Basel and for a number of events between now and the first flight. And we see this relationship expanding such that we'll do a number of charters for Soho House through the year to all of their other properties. And as well, this will attract more clients such as Soho House to Flugy, and we're now looking to bring in external capital to now grow and expand Flugy with this proof of concept. So this is an example of how we're looking outside the box to expand the potential market for our charter aircraft into new markets with new partners and co-branding with well-established travel brands that adds to our credibility as we move this airline forward. Talked a little bit about the cargo business. Again, this is a major piece of our business going forward. It gives us diversity of revenue streams and because our pilots can operate both types of airplanes in A320, passenger airplane A321 freighter aircraft it gives us a great, great amount of flexibility. It allows us to deploy our assets -- our human assets over all of our fixed assets, which is a major advantage for us as we look to reduce costs. So as I mentioned before, our certification will start in January. We hope and expect to be flying proving runs by late August or September and then into major contract with some of the -- one or more of the large package carriers sometime late in 2022. Again, we expect and hope to get to 25 of these aircraft. It is a phenomenal aircraft. It stacks up very well against its competition. And we've seen Lufthansa recently decided to go with the 321 freighter as 1 of their fleet standards. And so we know we've made the right decision focusing our efforts on this particular cargo aircraft. I'll ask Ryan to talk about our S-1 process.

So our S-1 process, which has been going on for the greater part of the year, we filed a public version of the S-1 on November 22. It included Q3 financial statements and an updated business section, which is our seventh version of the filing. Many people have asked why are we filing an S-1, what is this? What is the registration statement? Global Crossing is when we domesticated from BC to Delaware in January of this year. became required under SEC regulations to file a registration statement. This registration statement, we believe will accelerate initial excellence we want to do as part as an uplisting in the next year. This also has the impact of registering all the shares issued in offerings in June January and May of 2021. So in the end, what this S1, we believe does, it brings us greater access to U.S. capital markets. It's required by the SEC and also as required by the Canadian regulator to allow us to file and just GAAP versus having to file financial statements in both GAAP and IFRS. So it's a key step as part of our evolution. And we hope to have that done in the next couple of weeks.

And I think the most important point there is this will help us facilitate to an uplist to NASDAQ. It's required by regulations. And we are a fully reporting company, and we should be in full compliance with SEC regulations. This S-1 does that. It's an excel excellently drafted statement and we will get great use of this going forward. And it gives our vendors, our aircraft lessors, Airbus and others that we do business with gives them a great deal of comfort that we have taken this step. So in summary, let's talk about this.

Yes, real quickly, we are constantly compared to the Jet index, which is -- which covers all the major airlines. We believe we are a differentiated product from that. Our risk profile is significantly different. Keep in mind, we don't take fuel risk. We don't take distribution risk. We do hopefully charters. We believe our cost structure has significantly improved having -- we are operating with little to no or 100% equity financed and we acquired all our assets post-COVID. That being said, we're seeing since November, there has been a downtick in the major airlines, which we've outperformed, and we believe we can continue to outperform the index as a whole.

Yes. This chart was provided to us by ITG, our market maker. They've done an excellent job for us. Everyone knows we've got somewhat low volumes. We are in a major investor outreach program now, which Ryan can talk about. We are trying to get out to talk to as many potential investors as we can. An uplisting to NASDAQ will facilitate the ability of institutional investors to invest in our stock, which we believe that we need. We also know that we've got a somewhat of a complex stock structure with the Class A and the Class Bs that were required because of foreign ownership restrictions. We believe that, that will mitigate itself over time and potentially the Class B shares can go away. Until then, it's a more difficult story to tell because it's not as clean a structure as we would like. We are working to change that. So again, we've got a major Investor Relations outreach through Howard Group through some firms here in the U.S. and others to get this story out. As we scale and add more aircraft, we believe that, that -- the story will be more widely spread. And particularly as we get through the last vestiges of this pandemic, if that's possible, there will be more focus on our ability to grow in the post-pandemic market with cheap airplanes, and clients who are lined up to work with us. So in summary, we have a resilient and diverse business model, both passenger and eventually cargo are the 2 main components of our model. We're getting assets acquired at post-COVID prices, which is still a major advantage. Probably 40% of what we would have paid for these assets pre-COVID. And we see this condition or environment -- pricing environment continuing for at least in the next 12 to 18 months, which is why we're moving so quickly to tie up airplanes. As Ryan mentioned, we're 100% equity financed to date. We have no debt, and we're well positioned now, we believe, for the high growth that we will see as all of these sectors rebound post-pandemic. So we think we've built an excellent foundation and platform here. We're working with some of the top aircraft leasing companies, lessors, all of whom want to work with us. We are we've gotten our mutation statements filed and we are ready for a very robust 2022, which will see us increase in size, probably double in size by the end of 2022. So with that, Grant, we'll turn it back to you, and you can lead us through some questions.

Thank you, Ryan, that was excellent. That was at 40 minutes, thoughtful of information. We have some questions that have come in already, and I'll get to those. There is one is from Rob Astec 2 questions. What is your current daily load capacity? And how much of that is currently booked daily?

I think for -- part of what we have to be careful of a selective financial disclosure. And so we have disclosed how much capacity we do have -- we can't really make a comment on revenue play, given where we are in the process with S1.

I think people maybe take a bit of a hit from that 1 chart towards the end of the presentation in terms of your available aircraft and for the trajectory of the our loan are going in the next at with all of the aircraft that are coming on next year.

Yes, that's hours available for sale. And so that's a key distinction.

Hours available for sale. So basically, we have 3 aircraft now. And depending upon the client and how it's scheduled, we can get anywhere from I mean our objective is 130 to 150 hours per month per aircraft, okay? So our objective every day is anywhere from 3 to 5 hours of revenue flying per day per aircraft. That's our objective. And as each airplane comes on, we're able to increase the number of hours that are available because we have more optionality in terms of scheduling aircraft.

You have to be very cautious in terms of how you guide. I appreciate that. Next question, which of the recently announced AOCs have received clients currently have ongoing flights?

So we have Mexico, Canada and Brazil.

Yes. We've -- so for Canada, we have filed for flying for Canada Jetlines. For Mexico, we have a client who has assets to start daily flights to a city in Mexico, which we're working on now. And Brazil, we have put that in place because we have a number of clients who need to get to Brazil, some soccer teams in both directions as well as some tour groups.

Going from anonymous. And Ed, you have spoken about this in part as has Ryan, how many new shareholders has the company gained over the past quarter? Stock volume is low prices is low what is the company proactively doing to improve it? And just a little comment [indiscernible].

Grant, you broke up on the last part.

A company called Sun Country Airlines, which Ed and Ryan are very, very familiar with...

We'll try and address, I think, what we saw. You want to go first, you want to try...

Yes. Grant, I'm not sure if you can hear us. Your picture is frozen, and we can't hear -- we couldn't hear the last part of your question. Okay. Can we move on? Yes. So let me see if I could take some pieces of that. And Grant, I don't think you can hear me because your picture is frozen. Yes, we do look closely at. He's on hold. Okay. We do look very closely at Sun Country. I can't tell you how many new investors we have. We talk to a lot of the investors who have been with us almost since the beginning, some from the first round, some from the second round and in the third round. And what we have found talking to them is that, I guess, I can say this, all of them have said that they're not sellers. They will hold on to the stock. They see the long-term potential. And so we're seeing small volumes because there are essentially no sellers. And Ryan, I don't know if you want to expand on that?

Yes. I think 1 of the struggles we have is not many are selling. And so when there's some selling. We're working to find buyers to match. I think this is a constant evolution as people who have been with us since the beginning, Minister's been with us through certification. I think a lot of investors were betting on whether we get or not, and we did it. And then they're bedding whether he can get planes or not. I think we've done it. And then the next question is, can you fill the plans? I think we're demonstrating we're able to do that. And so we're continually expanding our story, expanding our audience. Now that we're in revenue service I think we can attract a much broader investor base with a different risk tolerance. And so it is a transition process, and we're sticking on it. I think we probably do 20 or 30 calls a week. And constantly telling the story, and we have various investors at different stages of the due diligence process, and we're encouraged with what we're coming backward.

Yes. Where you buy now? Am I back?

Yes, you are back.

I think I had a power bump, so apologies for that. What I was saying about Sun Country Airlines because I follow that closely as a pure comparison even though it's much larger and been around for many years. We have everything in context. Go back a couple of weeks. Sun Country had about a $2 billion market cap and it was closing in on $35 a share. I looked at it earlier this morning, it was barely holding about $26. I don't know what was done lately, and it's wiped off $400 million to $500 million in market cap. So everything is relative, especially in the current environment.

Yes, I think that's true, Grant. I'm not sure if you heard a lot of our responses to that. But to repeat ourselves. What we found talking to our investors who came in, in the first round, second round third round, they're not sellers. So very little volume. There's very few shares out there for sale. So when -- in that sort of environment, which our market maker says it's a very bullish indication, obviously, we've got people who want to hold on to our shares when there is a price movement, it's typically down because someone needs to sell and it sells at a under market. Not much we can do about that. All we can do is perform, and show people we can perform. As Ryan said, we got certified. We have airplanes on this certificate. We have airplanes coming, and we will continue to grow and perform. And the market will eventually understand that story.

Great. [indiscernible], will you have to do a reverse split to list on NASDAQ?

We don't know. I think the idea of what we're going to do with NASDAQ will determine when we're going on to NASDAQ.

Yes, a little more expanded. Obviously, we could do a reverse split and list on NASDAQ. We would prefer not to do that. We would prefer to do...

Further price to appreciate the way work.

Yes. Yes, we -- yes, exactly. We would prefer for it to appreciate to what its current valuation, in our opinion, should be and then continue to raise money based on that and do an uplift.

Again, how is cash flow? I've seen some news regarding the selling of shares/warrants to raise funds. I am not sure whether this went up approximately. I proposing is when approximately raising capital can retail shareholders gain access?

Well, we haven't announced any plans to sell shares or warrants. Cash flow is strong. We have a strong balance sheet. We have cash on the balance sheet as we had $8.9 million on the balance sheet in Q3. I think retail shareholders gaining access. The shares are available for sale every day. There's plenty of access we'd like to think. But again, there's been no news or announcements as to selling up shares or warrants.

That's not to say we grow and add airplanes and add infrastructure and all of the things that we need to grow that we would not raise more money in the future, I think everyone understood that. You can't get to 50 airplanes on the current capital base. And so a combination of current cash flow from operations as well as some combination of equity or debt offerings in the future will be needed to get us to 50 airlines, and that should not be a surprise to anyone.

I think one important item that a lot of people continue to myth or forget is that you're not -- you don't have any covered balance sheet, you're in great shape compared to other operations. Next one, once uplifted to NASDAQ will Jet B and Jet become one stock?

With ideally, the reason we have a Jet and Jet B is the DOT regulations as it relates to the number of foreign shares owned by non-U.S. citizens. We've seen a lot of influx of U.S. investors over the past 12 months. That ratio gets better every day. If we can get to the point where we're in comprised of DOT, without a Jet B, we would make that change.

And that's certainly our intention to do so. It's a cumbersome structure. It was required to meet the current DOT regulations for a new airline, especially 1 that is publicly traded, which they very rarely see. So we think the Class B shares will go away over time, and it won't be a long-term process to do that. Once the DOT is comfortable with us that we've got the safeguards in place to ensure that we know how many foreign shareholders we have, how many U.S. shareholders we have, and we can monitor that. It will be much, much less of an issue for them, and we should be able to eliminate the Class B's.

And I'm going to bypass because it's in regards to the share price in context to everything that you've achieved, but you've already addressed that. We'll move on Jerry [indiscernible], a delicate one. What can you tell us about projected earnings in the fourth quarter?

Nothing.

Jerry and everybody else, please understand it's a delicate issue right now as was addressed in regard to the S-1. This one from anonymous same theme, what is the Q4 and Q1 earnings forecast, you can't go there. Not rushing it off, but you don't want to get in trouble. It's that simple. Dave [indiscernible], any thoughts to the bargain basement A380 in the future? I don't quite understand that one.

No. Absolutely not. If I even thought of that, the Board should throw me out the window. So...

Given the current situation, is it a fair assumption that we will not be making drawdowns from the GEM equity agreement going forward? And sorry, before you answer that, the next question is also about Jim will Global access to the GEM financing during the current lawsuit also can give an to suggesting that GEM has told shares to manipulate the share price?

Well, we're -- it's a matter in litigation. It's a commercial dispute. And so there's not much that we can say about that. Let me say that we can adequately -- more than adequately finance our operations going forward without the GEM facility. So there should be no concern on any shareholders part or investors' part that Jim is absolutely critical to this operation. It is not. It would be nice to have that facility because if it was functioning properly and in accordance with, in our view, the agreements, it is a very efficient way for us to generate cash quickly if we need to make aircraft deposits or acquire assets or whatever the intended purpose is. It's a very efficient process. It's less of a discount than we would have if we did a major offering or a private placement. And in the beginning, it actually worked well. We would like them to adhere to the agreement as we would adhere to the agreement. And there's a possibility we think that, that relationship could be back on a good track. And so we'll go through that process with them and hopefully come out with a better agreement on the other side of that, that we both can work with and live with and that will be helpful to us. But having said that, again, we do not need the GEM facility to finance the growth and operations of this business. It would be nice to have. If we don't have it, we are experienced enough and have enough scale here at this airline that we are able to finance our operations going forward.

Other thoughts of other aircraft types in the future and then also from anonymous just a 319?

We've looked at 319's. The 320 gives us maximum optionality with clients because of the number of seats it has. The 319 gives you a smaller number of seats but not necessarily a lower operating cost per plane mile between the 319 and the 320. So just like JetBlue never acquired any 319s, their analysis was the 320 does everything that a 319 does for about the same price, but it gives you more seats. And that is our analysis as well. That doesn't mean that if a 319 deal comes along with very, very favorable lease rates for us that we would not take a very hard look at it. We've looked at a lot of 319 deals. And we may get 1 in the future right now, no. Other aircraft types, we will stay Airbus. There's a possibility in the future that we would upsize to a 330. We've talked about this in the past, so that's not a surprise. Our pilots can fly both airplanes. So they can be certificated on both airplanes and be able to fly both. So that they could fly of A320 into Miami, get off that airplane, get on to an A330 and fly that airplane to Los Angeles. That gives us a huge advantage. Major airlines can't do that because to their union rules, but we could do that. 330 is a very interesting airplane for us, just basically a large A321. And we've had a number of the brokers approach us and ask us how soon we could put an A330 on the certificate because there's plenty of client demand for that. Right now, we are focused completely on the A320, A321 and and getting the A321 freighter on the certificate. We're focused on getting to scale with the A320, getting to profitability and to grow that fleet. And then we'll pick our head up from our work, and we'll look at other aircraft types to add to the certificate.

In 330 the next question is. Do you have any updates on your plans for potential A330 P2F versions? I think you've addressed that. Okay. Next one. By the place from Toronto schedule ticket sales or charter flight from a major client?

Well, from the Global Crossing standpoint, we'll be chartering flights in Canada Jetlines. They'll be selling the tickets directly through their Canada Jetlines Vacations subsidiary directly to customers.

So our client is Canada Jetlines.

And then Canada deadlines will be selling the ticket side locations.

Canada Jetlines has a tremendous sales and marketing group that has a lot of experience doing this. And as we've said a couple of times around the headquarters here, if you cannot sell seats from Toronto to Miami and the dead of winter, you're probably in the wrong business.

Going back to B shares going away once DOT is satisfied with U.S. ownership? Will they be converted to Jet shares unless a capital appreciation for Jet B holders?

Well, again, we've discussed this in the past, Jet B shares can be exchanged for Jet shares on a one-to-one basis. That would be the expectation. If they were to go away, they would be converted to Jet shares. And if the Jet shares are trading at a higher price. And yes, that would be a capital rotation.

But investors can allow to have their Jet B shares converted to Jet today. And have we had any?

We have a number of people have done it.

Number of people have done it.

A number of people have done it successfully. Again, we don't necessarily see a need for it. We think they should be trading effectively at the same price. But again, the idea wouldn't be to punish the Jet B shareholders if we were to get rid of the Jet B, they would be converted one for one.

Okay. Just one another question about earnings forecast, which we can't touch. Jerry Kaiser in regards to the GEM litigation, can you elaborate a bit more on the lawsuit?

Well, it's part of the public record. We want them to adhere to the agreement. They believe that they adhere to the agreement. It's a matter of public record that what there is a period of time when the shares are priced. And there are restrictions around selling during that time period. We believe that they did not adhere completely to the -- both the letter and the spirit of the agreement. So we wanted to have a conversation with them. We had to provide a commitment fee to them from the original agreement. And we said we will -- we are prepared to pay that as soon as we can meet with GEM and ensure the process going forward is in compliance with the agreement as we see it. They dispute that, and they instead of -- they first wanted to talk with us and ask for arbitration. We accepted arbitration and then they decided to know that in 1 arbitration, they wanted to bring a lawsuit, which we thought was odd because we were ready to sit down and work out all the issues and move forward and continue to use the facility. We would love to have this facility in place for the next couple of years to be able to draw as we need it. if we needed to complement and supplement our other equity raising activities. So I am hopeful that we will come to a resolution with them. but I needed to be sure, since I am fiduciarily responsible for this company that they adhere to the agreement in the way that we believe the agreement was structured. And when I am satisfied with that, we will settle with them and we will move forward. So we are doing what we are required to do as a public company to protect the interest and the capital of our shareholders.

The last 1 is no time frame for NASDAQ question mark. There was a time frame addressed in the presentation that the process would start in Q1 of '22. With that, Ed, Ryan, thank you. Any closing comments.

No. Again, Grant, thank you so much for hosting this webinar today. We find it the most effective way to get our story out to people. So we'll be looking to do this maybe not once a month, but at least once a quarter through your good offices. And we appreciate everybody's support. I will tell you that the team here is working very, very hard. To go from 2 airplanes to 6 airplanes in 4 months is quite an achievement, particularly in the environment that we're in today. So my hats are off to the management team as well as our pilot core and our flight attendant group who are manning these airplanes. And we, again, believe we are very well positioned for 2022 as we get through some of these other issues, get our S1 deemed effective by the SEC, get some of the additional airplanes on the certificate, we will be well positioned to take advantage of 2022. So again, thanks, everyone, for your support of our stock, support of our story, and we will be continuing to be in touch with all of you. And thanks again, Grant.

Thanks to all those who attended. Ed, Ryan, much appreciated

Thank you.

Thank you.