Jack Creek Investment Corp - Ordinary Shares - Class A Stock

Thank you. a member of our team will be happy to assist. Please stand by. Your meeting is about to begin. Greetings and welcome to the Bridger Aerospace second quarter 2026 earnings call. As a reminder, today's call is being recorded. It is now my pleasure to introduce your host, Anne Hayes, CFO. You may begin.

Thank you and welcome everyone to our second quarter 2026 earnings call. Joining me today is our President and Chief Executive Officer Sam Davis. Before we begin, I would like to take this opportunity to remind everyone that during the course of this call, management may make forward-looking statements. which are subject to risks, uncertainties, and other factors that could cause actual results to differ materially from those expressed or implied by such statements as described in our 2025 Annual Report on Form 10-K and other filings we make with the SEC from time. Except to the extent otherwise required by law, we undertake no obligation to revise or update any forward-looking statements. In addition, we may discuss certain non-GAAP financial measures such as adjusted EBITDA. Please refer to our earnings release for the calculation of these measures and the appropriate gap reconciliation. With that, I'd like to turn the call over to Sam.

Thank you, Anne, and welcome everyone. As we entered 2026, our focus was on ensuring our fleet, our technology, and our people were fully prepared for what we believe would be another active wildfire year. Today, just a few months later, we're seeing that preparation translate into execution. and I'm incredibly proud of the long hours and diligence the Bridger team has shown throughout the year so far. Our second quarter financial results were in line with our expectations. Revenue was $30.5 million, essentially flat compared to the prior year period, the timing of non-recurring return-to-service work on our Spanish scoopers in 2025. Excluding that impact, revenue increased year over year, which Ann will walk through in more detail shortly. First, I'd like to start with an update on some of the highlights from the second quarter.

During the quarter, the U.S. Forest Service awarded us two 160-day task orders covering four of our Super Scoopers, the longest guaranteed task orders in Bridger's history. These orders will activate on a staggered basis into October and November, reflecting the agency's anticipated need for wildfire suppression well into the fourth quarter. Longer contract durations like these improve our fleet utilization, give us greater operational visibility and allow us to better plan maintenance and staffing. and we believe they reflect a broader shift toward year-round wildfire preparedness among our government partners. We also deployed our most advanced platform, the King Air 350, under a Department of the Interior task order. This aircraft incorporates dual sensor capability and real-time data dissemination into a software. As wildfire response becomes increasingly intelligence-driven, we believe these aircraft are becoming force multipliers, providing incident commanders with real-time situational awareness that improves proactive decision-making throughout an incident. Shortly after quarter end, we announced a $58 million contract with the Texas A&M Forest Service to acquire, modify and deliver three King Air 360 multi-mission aircraft over the next three years.

Texas is building one of the nation's most advanced state wildfire aviation programs, and we are proud to have been selected to help design and deliver that capability. This contract is a notable example of how our opportunity extends beyond simply operating aircraft into engineering, modification, and integrated intelligence work. And we believe it represents an attractive new avenue of non-seasonal long-term growth. Also, following the quarter, we announced a collaboration with DaVinci's, Europe's leading provider of emergency aerial services, deploying our two newest super scoopers in Portugal. We are glad to support one of Europe's most demanding fire seasons in recent history. Commitments there came somewhat later than expected, but consistent with Europe's more cautious approach to long-term contracts with private operators. This has been more than offset, however, by the demand we're seeing here with our U.S.-based super scoopers.

Now let's turn to look at the fire conditions. Fire conditions today accelerated throughout the quarter with above normal activity across multiple regions of the West. As of early August, more than 5.5 million acres of burn across the U.S., while Europe is experiencing one of its most severe wildfire seasons in years. We are currently at a preparedness level of five, the highest level on a national scale, meaning firefighting resources nationally are fully committed. We've even seen international crews mobilized to support U.S. efforts, including more than 60 firefighters from Australia and New Zealand in recent weeks. Current drought conditions and long-range forecasts suggest this activity will continue, and we expect demand for our services to remain strong through the remainder of the season. Now let me provide a quick update on IGNIS.

Technology continues to be an important differentiator for Bridger. During the quarter, we expanded IGNIS through a strategic partnership with TRAC+, integrating real-time aircraft tracking, mission information, and aero suppression intelligence into a unified operating picture. Over time, we believe software and data will become an increasingly valuable component. complement to our aviation assets. These developments reinforce our conviction that Bridger has an evolving integration into a solution that combines aerial suppression, airborne intelligence, engineering expertise, and software, not simply an aerial operator. And we believe this diversification can help smooth our revenue and earnings visibility over the long term. This provides a competitive edge to our aviation contracts, increases our utilization while we're deployed, and opens the door for standalone use of our software in the field. While the second quarter reflects the seasonal ramp up of our business, the underlying fundamentals remain strong.

With demand continuing to build and our fleet fully engaged, we believe Bridger is well positioned and we remain focused on executing our mission with the utmost focus on safety and efficiency. to thank our employees for their continued dedication and vigilance in the field and our government partners and shareholders for their continued trust and support. With that, I'll turn the call back over to Anne to review our financial results in more detail.

Thanks, Sam. Bridger continues to execute against significant growth opportunity. And as the business scales, we're focused on ensuring we have the financial infrastructure, processes and discipline to support that growth over the long term. As mentioned last quarter, I am focused on continuing to build and strengthen the finance function at the company and to support anticipated growth, especially as we ramp up for new programs with new fleets. With that, let me walk through our second quarter results. LOOKING AT OUR RESULTS FOR THE SECOND QUARTER OF 2026, REVENUE WAS 30.5 MILLION COMPARED TO 30.8 MILLION IN THE SECOND QUARTER OF 2025. WHILE REVENUE WAS GENERALLY CONSISTENT WITH THE PRIOR YEAR PERIOD, IT'S IMPORTANT TO NOTE THAT THE PRIOR YEAR QUARTER BENEFITED FROM 5.1 1 million of non-recurring return to service work on the Spanish Super Scoopers, which was mostly non-contributing to margins. compared to 0.8 million in the current quarter, a delta of 4.3 million. this non-recurring activity revenue increased 16% year-over-year primarily reflecting increased super scooper flight hours during the quarter and continued demand for our aerial firefighting services. Cost of revenues was $19.2 million compared to $18.7 million for the second quarter of 2025.

When excluding the return to service work on the Spanish scoopers, cost of revenues increased 32%. The increase primarily reflects the operating costs required to support increased fleet utilization during the quarter. It also captures fleet expansion, including center modifications to our two new King Air 350 aircraft and fleet readiness as we entered peak fire season towards the end of June. As a reminder, and given the continued volatility in fuel prices, I'd like to briefly touch on bridgers' exposure to fuel costs. expense is largely a pass-through cost across our portfolio. Under all of our Super Scooper fire suppression contracts, fuel is fully reimbursed by the customer while on contract. Across the majority of our light fixed-wing contracts, we either benefit from economic price adjustment mechanisms or fuel is similarly treated as a pass-through expense. As a result, fluctuations in fuel prices generally have limited impact to on-contract flying.

Where we do see an impact is across support areas like airfare and other workforce travel and costs for our MRU or mobile repair unit diesel trucks that follow our fleet and act as on the ground repair stations when aircraft are not operating at night. SELLING GENERAL AND ADMINISTRATIVE EXPENSES WERE 5.3 MILLION COMPARED TO 6.5 MILLION IN THE PRIOR YEAR PERIOD. The year-over-year decline was primarily driven by lower non-cash expenses, including changes in the fair value of warrants, stock-based compensation, and contingent consideration. INTEREST EXPENSE FOR THE SECOND QUARTER WAS $6.6 MILLION COMPARED TO $5.7 MILLION IN THE PRIOR YEAR PERIOD, REFLECTING AN ADDITIONAL $25 MILLION DRAWN FOR FLEET EXPANSION AND $10 MILLION IN SHORT-TERM BORROWINGS ON THE CREDIT FACILITY REVOLVER DURING HEAVY MAINTENANCE PERIODS IN Q1-A. For the second quarter of 2026, we reported a net loss of $0.5 million compared to net income of $0.3 million in the prior year period. As a reminder, our reported earnings per share include the impact of the adjustment to the redemption value of our Series A preferred stock. Loss attributable to common stockholders was $7.6 million, or $0.13 per diluted share, compared to a loss of $6.3 million in the prior year period, or 12 cents per diluted share.

Adjusted EBITDA was $8.1 million compared to $10.8 million in the second quarter of 2025. A reconciliation of adjusted EBITDA to net income is included in Exhibit A of the earnings release we issued today. Turning to the balance sheet, we ended the second quarter with $7.2 million of cash and cash equivalents. compared to $31.4 million at year-end 2025. The decrease primarily reflects seasonal working capital usage, including the timing of customer receipts, strategic investment in aircraft production slots, continued investment in modernizing our fleet with sensor and other technology capabilities, expenditures and continued investment in fleet readiness to support peak fire season operations. As expected, the second quarter represents a period of elevated working capital investment, as aircraft are deployed and operations ramp up during the peak fire season. We continue to expect cash generation to improve as the fire season progresses and receivables convert to cash. We also continue to maintain significant financial flexibility through our credit facility, including a delayed draw feature of up to $100 million, which is designed to support future fleet expansion and capitalize on growing demand for our services.

As of June 30th, we had approximately 75 million of remaining availability under the facility. Turning to our outlook, we are reiterating our full year 2026 guidance of 135 to 145 million in revenue and 55 to 60 million in adjusted EBITDA. This represents continued strong growth, including 29% growth in revenue when excluding non-profit. and reoccurring return to service work recognized in 2025 on the two Spanish scoopers. As Sam mentioned, our two Spanish scoopers are flying a shorter than planned summer fire season in Europe, after which we intend to reposition these aircraft to the U.S. for higher value opportunities. Third and fourth Spanish Scoopers are still undergoing return to service work. We continue to expect improved operating cash flow generation over the course of the year, driven by increased fleet utilization and higher levels of fire activity during the peak season. As we expand our multi-mission fleet mid-year, we expect the sensor-enabled Air Attack Program to contribute to growth in 2026 and support attractive margin expansion in our fleet over time.

With that, operator, we are now ready for questions. Thank you. If you would like to ask a question, please press star 1 on your telephone keypad. To leave the queue at any time, press star 2. Once again, that is star 1 to ask a question. Our first question is from Austin Muller with Canaccord. Please go ahead. Your line is open.

Hi, good afternoon. You have the lease agreement in place for two scoopers with Portugal. Can you just talk about where we're at with European negotiations, just considering the catastrophic wildfire season there? And could those planes be moved to the USA in October? if there's not further progress. Hey Austin, good to hear from you. Great question. Yes, I'll just be candid. The late pickup of those aircraft on contract is just an indication of the hesitancy for Europe to turn to private operators until things are developing like we see overseas right now. That is heavily influencing our decision, given the demand we see in our US fleet for what happens to those aircraft as they finish their work there in Portugal. We did partner with Avinci's to lease those to Avinci's as they operate them so that was a great outcome for us just later than anticipated.

And we do think there will be continued talks with European countries based on the year they're having. And we think the success they'll see with having these two scoopers in Portugal But for Bridger's internal purposes, we're planning on a move to the U.S., Without that commitment with the economics and demand we see here. Okay. And if we think about next year and the overall fleet, is the goal to lock up as many of your scoopers and MMAs as possible into a 120-day or longer task order? Absolutely. That's been a deep part of our strategy and we've chipped away at that methodically year after year. This year we look at eight of our nine surveillance aircraft on multi-year guaranteed commitments. We have four of our six here in the US on guaranteed 160 days. And that's been a long and drawn out process of improving that.

So we continue to capitalize on that. And I will say, given the demand we see, THE EXTENSIONS INTO Q3 AND Q4 WITH THE FOREST SERVICE, THE DEPARTMENT OF THE INTERIOR, WE NOW CONSIDER THIS TO BE THE NORM AND SOMETHING WE CAN CONTINUE TO MOVE THE BASELINE FOR the entire fleet. We also see that the more those days are guaranteed, the higher flight hours we see across the fleet, because once we're committed and pre-positioned were effective for flying in initial and direct attack, and so those two things seem to be symbiotic in our utilization.

Great. I'll pass it back there. Thank you. Thank you.

Thank you for your question. Our next question comes from John Sigmund with Stifle. Please go ahead your line is open.

Hey, good afternoon guys. This is actually Sebastian Rivera on for John today. Apologies if I may have missed this in the opening remarks, but can you maybe, is there any portion of these recent contracts with Texas A&M, Benchies, the DOI King Air 350 baked into this 2026 revenue guide.

Yes, I will say that for the Avinci's and for the King Air that we have at the Department of the Interior, we anticipated those and had those into our guidance. The Texas A&M, because that's a three-year program that starts more towards the end of this year. IT'S GOING TO BE A SLOW RAMP UP BUT WE DON'T THINK IT WILL BE IMPACTING OUR GUIDANCE OVERALL. SO THAT'S WHY WE'RE REITERATING WHAT WE HAVE. The Texas contract is a delivery of three aircraft starting in 2028, actually, to the customer. And so over the next three years, we recognize milestones with most of those starting effectively in 2027, if that makes sense.

And then, yes, on that Texas contract, can you maybe just walk through the accounting treatment there, given it's a little bit different nature? contract. Yes. I'll turn that. Yes. I'll turn that to you.

Yes, you're exactly right. So this will be a different, you know, a different business for us. It's modification. So it's more of cost to cost accounting. That's why in 2026, the majority of the work will not be done until 2027. We may, you know, we may place orders for the three King Airs from Textron and we may receive some cash payments. But as far as recognizing revenue, we anticipate, you know, it's preliminary to say, but very little to be in this year. And if so, it may not be margin generating revenue.

Thanks. I'll turn it over. Thank you. Thank you for your question. Our next question is from Mark Smith with Lake Street. Please go ahead. Your line is open.

Hi, guys. I wanted to ask a little bit about the guidance here, kind of looking at what we've booked year to date in revenue versus reiterated guidance. just walk us through kind of back half ramp, you know, what's already contracted versus kind of dependent on fire activity and what gives you the confidence in holding the guidance range.

Hey, Mark, good to hear from you. I'll take that and then I'll let Anne add a little bit of flavor. So going into this year, last year I'll remind you that we had a below average fire year in terms of overall activity. And we saw some unique fire activity, especially in Q1 with the Palisades fire that made our typical bell curve a little bit different than normal. And then activity kind of dropped off in terms of fires in September and October. This year we saw a fairly normal ramp up and we see the The activity in Q3 now at an all-time high and continued outlooks into Q3 and the commitments that we have that are coupled with that from the Forest Service and the DOI going into Q4, which we've never had, is kind of the shift from a 1H, you know, to a 2H, you know, half of the year recognition of the bulk of our revenue. even more so than maybe last year, but fairly typical with what we see in Q3 being the bulk of our revenue. And then kind of the last comment I'll make there is There could be a few days here or there or the fleet flying 30 hours in a day, which we've been seeing across the scooper fleet that could really move the needle a few million bucks. whether it's June 30th or July 1st, that we've kind of see that take effect as things got ramped up.

And maybe last comment there, we've also seen a little bit of a strategy with our agencies as they've committed later into Q3 and Q4 to making sure that our assets are set. for the peak of the season. So as we got deployed, we noticed a little bit of a staggered deployment so that they had the last half of the year covered for fire activity.

Okay. And then just as we think about revenue coming out of Europe with this new contract in Portugal, can you give us any more insight into maybe how much of an impact that this makes and maybe how much was maybe disappointing on?.

I CAN SPEAK TO IT AT A HIGH LEVEL. I WILL TELL YOU THERE'S TWO COMPONENTS TO THIS LEASE. WE ARE LEASING NOT BY MONTHS BUT ALSO BY HOURS. AND AS WE'VE SEEN EVEN THE HEADLINES FROM EUROPE HITTING OVER HERE THAT THEY ARE HAVING A VERY ACTIVE FIRE SEASON. SO THERE IS A VERY variability to that contract as well. So I can't say for sure how much we will make up. I can say that we did miss in Q2, in our internal estimates, just when we thought Europe would pick up.

Kind of what Sam has said though, between the US flying more than you know, a fire season like last year, as well as Europe, you know, potentially flying these harder than we are anticipating now, there is room to, you know, make up all of that gap that we have and then some.

Okay. And then I did just want to confirm, it sounds like the plan is still to roll these two planes into the U.S. after the season's done?.

Yes, that's currently the plan, Mark. Obviously, we have to see what materializes overseas, especially what we hope is the commitment is now there for, unfortunately, the terrible headlines we see. on the activity, but I will tell you with the economics and the utilization demand here in the U.S., until that commitment materializes in a like-for-like comparison, the plan will plan is to finish out the fire season and begin to move those over to the U.S.

Great. Thank you, guys. Thanks, Mark. Thank you for your question. At this time, there are no further questions. I will now turn the call back to Sam Davis for closing comments.

Thank you again for joining us today and your interest in Bridger. Please reach out to our investor relation team with any questions and we'll be participating in a fireside chat at the Canaccord Growth Conference in Boston next week for any interested investors. Have a great day.

Thank you. This brings us to the end of today's meeting. We appreciate your time and participation. You may now disconnect.

This live transcript is auto-generated without human intervention or review.

[Call has ended.]

Good afternoon, everyone. Welcome to today's Bridger Aerospace First Quarter 2026 Earnings Conference Call. [Operator Instructions] Please note, today's call is being recorded, and I will be standing by if you should need any assistance. It is now my pleasure to turn the meeting over to Ms. Anne Hayes, Chief Financial Officer. Ms. Hayes, please go ahead.

Thank you, Bo, and welcome, everyone, to our first quarter 2026 earnings call. Joining me today is Chief Executive Officer, Sam Davis. Before we begin, I would like to take this opportunity to remind everyone that during the course of this call, management may make forward-looking statements, which are subject to risks, uncertainties and other factors that could cause actual results to differ materially from those expressed or implied by such statements as described in our 2025 annual report on Form 10-K and other filings we make with the SEC from time to time.

Except to the extent otherwise required by law, we undertake no obligation to revise or update any forward-looking statement. In addition, we may discuss certain non-GAAP financial measures such as adjusted EBITDA. Please refer to our earnings release for the calculation of these measures and the appropriate GAAP reconciliation.

With that, I'd like to turn the call over to Sam.

Thank you, Anne, and welcome, everyone. 2026 began with a clear focus on readiness, ensuring our fleet, our technology and our teams are fully prepared for what we expect to be a very active wildfire season. I'm extremely proud of the team and their tireless focus on the mission to save lives and property, focusing on readiness year-round to answer the call and respond to fires quickly when it matters most.

The devastation of fires only continues to increase, and Bridger prides itself on its ability to find them and extinguish them quickly and effectively before these fires become the next avoidable headline.

Overall, our first quarter results were in line with internal expectations and our full year plan, reflecting the quarterly nature of our business and the timing of revenue recognition. Revenue of $8.5 million was lower year-over-year, primarily due to nonrecurring return to service work on our Spanish scoopers in 2025 and our early deployment activity last year in January related to the Palisades fire in California.

First, I'd like to start with an update of some highlights in the first quarter. For the first time in company history, we began our multi-mission aircraft contract on February 1 and dispatched to support heightened fire activity in Oklahoma. We also saw our earliest dispatch of our air attack aircraft to Texas in February for command and control missions. This early mobilization is consistent with what we are seeing more broadly across the market.

Fire activity beginning later, lasting longer and requiring more proactive engagement from our federal and state partners. During the quarter, we continued to make progress expanding and enhancing our fleet, including the modification of additional surveillance aircraft. These aircraft, which were added to the fleet at the end of 2025, will have unique configurations that introduce new intelligence capabilities into wildfire response in 2026 and will continue to drive the innovation of our multi-mission platforms.

Our current sensor enhanced aircraft, which are already deployed, have flown millions of acres in early 2026 to support real-time mapping, live streaming and situational awareness for fire teams across multiple states from Nebraska to Florida and Arizona to North Carolina. We're seeing rapid adoption of our sensor aircraft to detect fires and guide initial attack with our hours flown on our sensor planes nearly doubling Q1 of this year versus last. This early and broad-based deployment highlights both the increasing demand for our services and the growing importance of our technology-enhanced capabilities, particularly in supporting initial attack and real-time decision-making on the ground.

Safety is paramount to everything we do, and we believe every hour spent safely fighting fires is an extension of how we focus on preparation. In the first quarter, we invested in fleet readiness, including winter maintenance and flight training. Through focusing on the intensity of the fire year and not the fire season, our newly staggered maintenance cycle ensures we have aircraft from each mission set ready to deploy within hours. This spring, we maximized our time in field training for the firefighting operations and using extensive time in both classroom and on the wing.

With our readiness and specialized fleet, we are prepared to fulfill our mission to intercept and extinguish fires before they can bring widespread devastation. As a part of these efforts, we are proud to have qualified two new Scooper captains and two initial attack captains, bringing us to a total of four initial attack captains. The addition of these initial attack captains will allow us to remain out longer in Q4 and dispatch earlier in Q1 next year.

From an organizational perspective, we continue to build the leadership team required to support our growth. The recent additions of a Chief Operating Officer and General Counsel brings significant operational and public company experience and will help ensure we scale the business with a continued focus on safety, execution and governance.

Now let's turn to the outlook on fire conditions and an update on federal legislation. Across the nation, states are seeing record high temperatures, low snowpack and extensive droughts. For the entire U.S., March was the warmest it's been on record in over 130 years. These environmental factors point to elevated fire risk and importantly, the below average year in 2025 suggests that we have not yet seen the full impact of its fuel buildup.

We see multiple signals that heightened fire conditions are starting to converge. Just last week, the Secretary of Agriculture, Brooke Rollins issued a memo directing the U.S. Forest Service to heighten national wildfire readiness in the face of historic lack of winter snowpack predicted above normal temperatures and drier than normal conditions across the U.S.

She even went so far as to state that large wildfires are predicted to threaten homes, communities and natural resources this summer. In addition to the Secretary's comments, wildland fire managers have similar interest in more robust wildfire response and increased preparedness.

Within the President's budget, the administration is explicit about the need for the consolidation of wildfire programs between the USDA and the DOI. In addition to urging Congress to streamline fire suppression efforts, they've also advocated for the creation of a new wildfire intelligence center under the new unified U.S. Wildland Fire Service.

The Wildfire Intelligence Center will be focused on incorporating technology to assess and model wildfires, inform rapid response, coordinate suppression, promote fuel management and advance recovery and rehabilitation.

With Bridger's unique services, we are well positioned to not only meet the directives with the most effective suppression of surveillance aircraft, but also to introduce our leading-edge technology solution, Ignis, which I'll discuss more shortly.

Through these shifting environmental conditions and the notable devastation for mega fires like the Palisades and Smokehouse Creek fires, we've seen a move toward progressive wildfire management at the federal level to streamline agency coordination, commit to longer-term contracts and proactively station and use aviation resources.

We are continuing to monitor progress in active legislation regarding the consolidation of these agencies. Let me now provide a quick update on Ignis and FMS.

With our software platform, Ignis, we've been able to live stream our fire surveillance into mobile and desktop environments. In Q1 alone, the aviation module of Ignis has been used by emergency operations centers, pilots and ground firefighters. In Q2, we are officially launching the Ignis platform as a part of our aviation capabilities and introducing a new way for the industry to access an entire fire data ecosystem in one place. Our ability to be first to market, introduce -- and introduce leading-edge solutions into firefighting is due in part to the capabilities of our in-house engineering division, FMS Aerospace. They continue to not only contribute to the modifications of our internal fleet, but also in the defense and commercial contract work they pursue.

With the recent increase to the defense budget, we feel we're well positioned with our awarded programs being able to grow in existing capacity and pursue strategic new work on larger IDIQs that are good work -- good fit for our integrated services. We are currently listed on seven IDIQs covering various military branches. Much of the defense budget is focused on the upgrade of aviation assets and the advancement of sensor technology, both of which we specialize in.

While the first quarter reflects the planned slower revenue winter maintenance period of the wildfire industry, the underlying fundamentals remain strong. Demand continues to build and Bridger is entering the 2026 season with greater scale, enhanced capabilities with higher return profiles and a broader operational footprint than ever before. We are focused on executing through the upcoming fire season and translating this positioning into a year of strong growth and performance.

I'll turn the call back over to Anne, and she can go through our financials in more detail.

Thank you, Sam. It is a pleasure to be joining you all for my first earnings call as CFO, especially after having the privilege of serving on the Board and engaging with the team as they delivered such strong results. Before getting into the numbers, I wanted to share some initial observations. Bridger is at a pivotal stage. We've built a best-in-class aerial firefighting platform with one of the largest suppression fleets in the industry, and we're now squarely focused on executing our next phase of disciplined profitable growth.

The demand environment for our services remains exceptionally strong. And with our expanded Super Scooper and sensor-enabled air attack capabilities already positioned for the 2026 season, we're well prepared to scale operations, win additional contracts and drive meaningful revenue and cash flow generation.

From a leadership perspective on the finance team, my focus is on building and enhancing a high-performing organization that serves as a true strategic partner to the business. We're investing in talent to strengthen our planning, analysis and capital allocation capabilities so that we can support this accelerated growth phase while maintaining financial discipline operational leverage and transparency. I'm committed to fostering a culture of accountability and excellence that not only scales with the company, but also helps us deliver sustainable long-term value for our shareholders.

Looking at our results for the first quarter of 2026, revenue was $8.5 million compared to $15.6 million in the first quarter of 2025. The decline year-over-year was primarily driven by nonrecurring return to service work performed on the Spanish scoopers in 2025 as well as early deployment activity last year related to the Palisades fire. Return to service revenue was $1.7 million in the first quarter of 2026 compared to $5.9 million in the prior year period.

Excluding this impact, revenue from ongoing operations reflects the normal quarterly nature of the business, with the first quarter typically representing a period of lower aircraft deployment ahead of peak fire season. This year, we saw typical dispatch orders in the southern states that we've been seeing in recent years. Cost of revenues was $17 million in the first quarter of 2026 compared to $17.2 million in the first quarter of 2025, reflecting continued investment in fleet readiness and operational positioning ahead of the fire season.

Given the turbulence in fuel impacted industries, I do want to touch on Bridger's exposure to fluctuations in fuel prices. Fuel expenses are largely a pass-through cost. Under all of our fire suppression Super Scooper contracts, fuel is fully passed through to the customer. For the majority of our light fixed wing contracts, we either benefit from economic price adjustment clauses that mitigate fuel price impacts or fuel is treated as a pass-through expense.

Selling, general and administrative expenses were $16.7 million in the first quarter of 2026 compared to $8.6 million in the prior period. The increase was primarily driven by noncash items such as stock-based compensation and an increase in the fair value of warrants as well as cash items, including an investment in our workforce, specifically leadership and technology build-out as well as business development investment.

Interest expense for the first quarter was $6.2 million compared to $5.7 million in the prior year period. For the first quarter of 2026, we reported a net loss of $31.3 million or $0.69 per diluted share compared to a net loss of $15.5 million or $0.41 per diluted share in the first quarter of 2025.

Adjusted EBITDA was negative $14.5 million compared to negative $5.1 million in the prior year period. A reconciliation of adjusted EBITDA to net loss is included in Exhibit A of our earnings release distributed earlier today.

Turning to the balance sheet. We ended the first quarter with total cash and cash equivalents of $9 million compared to $31.4 million at year-end 2025. The decrease was primarily driven by strategic investment in aircraft production slots, investment modernizing our fleet with sensor and other technology capabilities and continued investment in fleet readiness and operations ahead of the fire season.

Importantly, the first quarter cash usage is consistent with the early season nature of our business, where we invest in aircraft maintenance, training and operational positioning in advance of peak deployment periods. As activity increases through the second and third quarters, we expect to see a corresponding improvement in revenue and cash generation.

We continue to have access to significant financial flexibility through our credit facility, including a delayed draw feature of up to $100 million, which is designed to support future fleet expansion and capitalize on growing demand for our services. As of March 31, we have approximately $90 million remaining.

Turning to our outlook. We are reiterating our full year 2026 guidance of $135 million to $145 million in revenue and $55 million to $60 million in adjusted EBITDA. This represents continued strong growth, including approximately 29% growth when excluding nonrecurring return to service work recognized in 2025 on the two Spanish scoopers. We are in active discussions in Europe to deploy the Super Scoopers for the summer fire season, followed by a planned repositioning of the two aircraft for higher-value U.S. contracts.

Contribution from Europe's summer fire season is included in our guidance, but handicapped for a shorter fire season and lower contract economics in Europe. The third and fourth Spanish scoopers are still undergoing return to service work.

We continue to expect improved operating cash flow generation over the course of the year, driven by increased fleet utilization and higher levels of fire activity during peak season. As we expand our MMA fleet midyear, we expect the sensor-enabled air attack program to contribute to growth in 2026 and support attractive margin expansion over time.

With that, operator, we are now ready for questions.

[Operator Instructions] We'll go first this afternoon to Austin Moeller with Canaccord Genuity.

So my first question is, I know that Ignis has been demoed by a couple of different government agencies. But is there a time line on when that might start to be included in some contracts? And would there be like a pricing premium associated with bundling Ignite with air attack and surveillance services?

Austin, good to talk to you again. Yes, that's a great question. So we have a very small amount of revenue budgeted this year intentionally for Ignis. This is more about the aviation contract bundling opportunity this gets us both for existing contracts as we provide unique configurations with our planes and our hardware sensors as well as the ability to live stream down to customers. We're already having them use it.

So we're able to do some contract modifications to add the software piece. Probably this is going to see a lot more fruition going into next year as we can sell this on a stand-alone basis for operators, state-owned drones and planes as well as what we can couple in with our aviation contracts and price in at a premium, more of a standard SaaS model revenue year-round subscription-based versus aviation contracts. So it's an exciting time for us to introduce because the industry is now ready for all of the capabilities that we're able to deliver with our real-time situational awareness.

And we've been able to build it into one ecosystem, even most recently bringing in some modeling capabilities, which don't quite exist in one place yet in the industry.

Okay. And if we think about the FMS upgrade and maintenance business in Huntsville, just given the record defense budget, possibly up to 50% increase year-over-year in fiscal year '27, how should we think about the top line growth profile of that business just as you get more orders from the Air Force and other service branches?

Yes, that's something we'll have to define a little bit further into the year. What I will say is that we're on track with that portion of the business to hit their revenue this year. We've noticed where there was a little bit of a lag in the commitment to expand the program orders that we had last year. Now we've been seeing these orders come back with some significant commitment for what we have in our existing pipeline, let alone what we believe will be accessible through the many IDIQs that we have in place as primes, the larger primes get more of these awards and pass along the work to us.

We're going to put concerted effort in what BD opportunities there going into the summer months here so that we can position uniquely with all the integrated services we have to get the right-sized jobs that incorporate all parts of Bridger's services, which are flight operations, maintenance, modification, flight testing and engineering, all the pieces that we have in place today.

We go next now to John Siegmann with Stifel.

I appreciate the earlier commentary on some of the moving parts in the federal policy. Just for outsiders, what are some things that we should be looking for? And any benefit of consolidating this funding? Is this more -- could this benefit this year, this fire season? Or is this kind of more longer-term benefit of any changes?

Yes. John, I think we, at Bridger are in full support of the consolidation, although there are growing pains associated with a big move like this, we don't trivialize that. The movements we've already seen in what the consolidation would mean, which would be more streamlined organization across the regions, dispatching, prepositioning to help meet some of the directives for more aggressive wildfire management are all important tenets to have as the framework for those more aggressive wildfire management techniques to take place.

So we think that, that will come more to fruition in an actual form next year because there are studies being done and some administrative reorganizations that are happening. I will say that we've seen more meaningful commitment. There's been a little bit of a lag here in Q1 of this year. But as we have the outlook of the fire year ahead of us and something significant as the USDA putting out a memo talking about the fire year and the significance and the preparedness that needs to be taking place is a significant indicator of the movements in that direction for the collaborative effort of a centralized Wildland Fire service and the moves to making those longer-term commitments.

So short answer, I think it's starting to have the right movements underway. I think before it takes shape in a more legislative appropriation and contract form, that's going to be more to next year, but we're already benefiting from some of those moves.

Great. We'll watch it. And then just a question on what you announced in early March, the $18.6 million Alaska contract. Can you just talk a little bit about how that contract works? Is an aircraft dedicated exclusively to that region? Just any kind of color would be appreciated.

Yes, you bet. We have two aircraft in Alaska right now on an exclusive use multiyear contract. Alaska has seen year-over-year, like the rest of the U.S., a lot of heightened fire activity. So that call when needed contract gives them the opportunity to call and retain more aviation assets either early in the season, later in the season or extended through the peak of the season. So it gives us the additional capacity to get more work earlier end of the year. We also have additional aircraft that could backfill that for that to be a surge capacity contract. It's a great one for us because it's more of the trends that we see at the state level where they're willing to commit to their own aviation contracts and make sure they have assets available when there's a catch-up in the unmet demand and the capacity that's out there. So we're pursuing more of these with a lot more of states throughout the West specifically.

[Operator Instructions] And Mr. Davis, it appears we have no further questions today. So I'll turn the conference back to you for any closing comments.

All right. Thank you again for joining us today and your interest in Bridger. Please reach out to our Investor Relations teams with any questions, and we will be participating in June at the Stifel Cross Sector Insights Conference for any interested investors. Thank you all so much, and have a great day.

Thank you, Mr. Davis. Thank you, Ms. Hayes. Again, ladies and gentlemen, this will conclude the Bridger Aerospace First Quarter Earnings Call. Again, thanks so much for joining us, everyone. We wish you all a great afternoon. Goodbye.

Greetings, and welcome to the Bridger Aerospace Fourth Quarter 2020 Conference Call. As a reminder, today's call is being recorded. It is now my pleasure to introduce your host, Eric Gerratt, Chief Financial Officer. Thank you. Mr. Jarrett, you may begin.

Good afternoon, and thank you for joining us today. Joining me on the call this afternoon is Chief Executive Officer, Sam Davis; and incoming CFO, Anne Hays.

Before we begin, please note that certain statements contained in this conference call that do not describe historical facts are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Since forward-looking statements are based on various assumptions, risks and uncertainties, actual results may differ materially from those expressed or implied by such statements.

Factors that could cause results to differ materially from those expressed include, but are not limited to, those disclosed in the company's filings with the U.S. Securities and Exchange Commission, including our expectations regarding financial results for 2026.

Management cannot control or predict many factors that impact future results. Listeners should not place undue reliance on forward-looking statements, which reflect management's views only as of today. We anticipate that subsequent events and developments will cause our assessments to change. However, we undertake no obligation to revise or update any forward-looking statements or to make any other forward-looking statements.

Throughout this afternoon's earnings release and call today, we refer to the non-GAAP financial measure adjusted EBITDA. The definition, calculation and reconciliation to the financial statements of adjusted EBITDA can be found in Exhibit A of our earnings release, which is available on our website. We believe adjusted EBITDA is useful in evaluating our reported results as a supplement to and not a substitute for results reported under GAAP.

With that, I'd like to turn the call over to Sam.

Thank you, Eric. First, I wanted to say how proud I am of our team throughout this period of incredible growth. They have risen to the occasion and have been the champions of Bridger culture and focused on the mission and dedicated to safety. Their execution drove record operational and financial performance again in 2025.

We generated positive net income and posted a second year of positive cash flow with revenue and adjusted EBITDA both growing by more than 20%. It's important to note that this record performance was achieved during what was statistically a below average fire year. This financial resilience underscores the strength of our business model, the growing diversification of our revenue streams and the benefits of securing longer-term task orders for our aircraft.

While the reported number of wildfires nationwide was noticeably higher in 2025 and nearly 78,000 fires compared to the 5- and 10-year averages of around 62,000, they burn far below the normal acreage nationwide of 5.1 million acres, more than 30% below the 5- and 10-year averages. This is likely the result of our federal and state customers growing emphasis on early detection, initial and direct attack in a more rapid response to wildfire.

This proactive approach, combined with the impressive performance of our scoopers and enhanced [ Arotech ] assets helped drive strategic prepositioning of our fleet and improved utilization in 2025.

Utilization, which is measured in days on contract, was up almost 10% year-over-year. Our multi-mission aircraft almost doubled their flight hours year-over-year and remain deployed well into November.

The increased utilization rates have paralleled an ideological shift in how the U.S. fights wildfires. Throughout 2025, we saw many federal and state customers place increased emphasis on initial and direct attack. Fortunately, for Bridger, we have the aircraft best suited for this aggressive wildfire management style. We are directing our efforts to maximize the use of aircraft we have while finding other opportunities to expand our capacity with additional aircraft.

Looking at the 2025 wildfire statistic for [ Super scooper ] specifically, there continues to be unmet demand, as demonstrated by over 60 orders that were unable to be filled due to aircraft already deployed in fires. Of the total request made, this represented a 48% unfilled rate.

So far this year, we have deployed 2 [ Pilatus PC-12 ] and 2 super scoopers to find fire of the PC-12 multi-mission aircraft mobilized to Oklahoma and 1 mobilized to Texas to provide aerial intelligence for early season wildfires. The call up of our enhanced aforementioned platform demonstrates the aforementioned prioritization of early detection and the proven effectiveness of our advanced sensors and imaging systems.

Demonstrating our ongoing commitment for year-round readiness, at least 3 of our super scoopers have remained ready throughout the winter months to be dispatched or to support training. Early in the year, we even prepositioned aircraft in Arizona as a proximity advantage as wildfire threats began to rise in the southern states.

Let me now provide an update on our contracting as we look out to 2026. We continue to target multiyear and exclusive-use contracts to build resiliency in our revenue and drive utilization. Maximizing the number of these exclusive use commitments helps to ensure our fleet remains dedicated to critical wildfire response efforts.

We are in active discussions with numerous states to provide exclusive use of our firefighting assets. and are optimistic that current budgeting and planning cycles will lead to future opportunities in the coming months.

Just this week, we announced a 5-year multiple award, indefinite delivery, indefinite quantity, or IDIQ, contract for collided fixed-wing transportation services in Alaska. We will be supporting personnel and cargo movements for the U.S. Department of Interior and other federal agencies on an as-needed basis.

Although this is not a guarantee, this contract is estimated at $18.6 million. This contract allows Bridger to create additional work for existing aircraft, as well as answer demand as we grow our fleet with similar capabilities at the state and federal levels.

Through our FMS subsidiary, we are dedicating resources for modification work on several internal aircraft to enhance our technology platforms. These modified aircraft are becoming a growing part of our contracting discussions.

We're also in active firefighting contract discussions for our first 2 Spanish scoopers in Europe, having purchased them from our partnership with MAB Funding LLC in the fourth quarter. The third and fourth Spanish Coopers continue to undergo the final stages of their return to service work by our Spanish subsidiary, Albacete Aero. As they become available later in 2026, we will look to enter discussions with MAB to potentially acquire these aircraft as well.

Let me now provide a quick update on FMS and Ignis, our 2 acquisitions, contributed $7.9 million in revenue for 2025. As I mentioned, much of their resources have been dedicated to internal aircraft modifications for Bridger aircraft to solidify our competitive edge. These technology-enhanced platforms are in high demand and have been instrumental in our ability to position Bridger for high-margin work.

We also continue to see a number of contracting opportunities, primarily with the DoD in active bids with FMS' capabilities that put Bridger uniquely positioned to respond to. In addition, to awarded work with our partner, positive aviation for the FF72 aircraft, our recent wins include a small award with the U.S. Air Force and Borsig.

While revenue in FMS saw delays due to federal budgeting uncertainties through 2025, we do see momentum in federal funding with recent increases through the National Defense Authorization Act for 2025 for $895 billion.

With our integrated services, we remain well positioned for a wide range of defense as well as commercial work. We're in the middle of repurposing our business development team to target this work. And much of the opportunities are fairly small and strategic with potential to scale into large volume, nonfire, nonseasonal, complementary to the services we already provide.

Also, a quick update on the Ignis Technologies platform. Since launching the mobile platform to support firefighters in the field over a year ago, pilot programs utilizing the platform with counties, crews and incident management teams continue. We are now linking Bridger's real-time sensory image with the Ignis app, creating a seamless data flow from air to ground.

Already this year, we have been live streaming wildfire progression, delivering perimeter mapping and even providing drop targets for aerial support as we deliver our imagery to ground firefighters, pilots and incident commanders to make effective real-time decisions and enhance the safety of all operations in the fire stack. This capability is unlocking new levels of situational awareness and supporting multi-mission aviation contracts and enhances both operational effectiveness and safety.

With the continued success of our sensor enhanced aircraft in this field, the need for interactive live data streaming is stronger than ever and we intend for this to be a critical part of our sensor enhanced aviation contracts this year.

As we look out to 2026, we are well positioned for another year of greater than 25% growth. This includes revenue from our 2 new Spanish coopers as well as 2 new Arotech aircraft, which we added in the fourth quarter. Our improved balance sheet provides the financial flexibility to acquire additional aircraft in response to contract expansion opportunities and further drive EBITDA growth and long-term shareholder value.

This growth stands against the backdrop of recent federal initiatives to restructure our National Wild line firefighting system. This includes the executive order in early 2025, the called for the establishment of a national wildland firefighting task force, the establishment of the Wild band fire service and passage of the Fire Ready Nation Act and Aerial firefighting Enhancement Act of 2025; all of which are focused on improving wildfire response.

With Bridger's significant air attack fleet, including modern fire imaging and surveillance aircraft and the world's largest private superscooper fleet; we believe we are uniquely positioned to protect lives, property critical infrastructure and the environment as the nation focuses on preparedness and aggressive wildfire suppression.

We have exciting opportunities before us, and I remain grateful and humbled to lead this exceptional team.

Let me now turn it back to Eric, who will talk about our strong financial performance in 2025.

Thanks, Sam. Looking at our results for the fourth quarter of 2025, revenue was $8.5 million compared to $15.6 million in the fourth quarter of 2024. The decline year-over-year was partially related to the later deployment of our Super Scoopers in the fourth quarter of 2024 compared to the fourth quarter of 2025.

Excluding revenue for return to service work performed on the Spanish Super Scoopers as part of our partnership agreement with MAB Funding LLC, which was $0.8 million in the fourth quarter of 2025 and $5.1 million in the fourth quarter of 2024; revenue from ongoing operations, including FMS, was approximately $7.7 million compared to approximately $10.5 million in the fourth quarter of 2024.

Cost of revenues was $14.1 million in the fourth quarter of 2025 and was comprised of flight operations expenses of $5.7 million and maintenance expenses of $8.4 million. This compares to $15.4 million in the fourth quarter of 2024, which included $5.8 million of flight operation expenses and $9.6 million of maintenance expenses.

Cost of revenues associated with the return to service work on the Spanish Super Scoopers declined $4.2 million in the fourth quarter of 2025 compared to the fourth quarter of 2024.

Selling, general and administrative expenses were $13.4 million in the fourth quarter of 2025 compared to $7.7 million in the fourth quarter of 2024, primarily reflecting an increase in the fair value of our warrants and an increase in earn-out consideration compared to the fourth quarter of 2024.

Interest expense for the fourth quarter was $6 million compared to $5.9 million in the fourth quarter last year. Other income was $10 million in the fourth quarter of 2025 compared to $0.3 million in the fourth quarter of 2024. The increase was primarily attributable to a gain of $16.9 million related to the sale-leaseback transaction, partially offset by a loss of $7.8 million on the extinguishment of debt in conjunction with our debt refinancing in the fourth quarter of 2025.

For the fourth quarter of 2025, we reported a net loss of $15.1 million or $0.40 per diluted share compared to a net loss of $12.8 million or $0.36 per diluted share in the fourth quarter of 2024. Adjusted EBITDA was negative $9.5 million in the fourth quarter compared to negative $2.9 million in the fourth quarter of 2024. A reconciliation of adjusted EBITDA to net loss is included in Exhibit A of our earnings release distributed earlier today.

Looking at our results for the full year 2025, revenue was $122.8 million compared to $98.6 million in 2024, a 25% increase. Excluding return to service work on the Spanish Super Scoopers, revenue was $108.8 million compared to $88.5 million in 2024, which was up 23%.

Cost of revenues was $71.1 million, comprised of flight operation expenses of $31.9 million and maintenance expenses of $39.2 million. Cost of revenues for 2024 was $57.5 million, comprised of $31 million of flight operations expenses and maintenance expenses of $26.5 million. Cost of revenues for 2025 included an increase of approximately $5.4 million of expenses associated with the return to service work on the Spanish Super Scoopers compared to 2024.

SG&A expenses were $36.3 million compared to $35.8 million in 2024, with the increase primarily driven by an increase in the fair value of our warrants, partially offset by a decrease in noncash stock-based compensation expense.

Interest expense for 2025 was $23.3 million compared to $23.7 million in 2024. We also reported other income of $11.8 million for 2025, inclusive of the gain of $16.9 million on the sale leaseback transaction, partially offset by the loss of $7.8 million on the extinguishment of debt. Other income was $2.1 million for 2024.

Net income was $4.1 million in 2025 compared to a net loss of $15.6 million in 2024. Adjusted EBITDA was $45.3 million in 2025 compared to $37.3 million in 2024,

Turning to the balance sheet. We ended 2025 with total cash and cash equivalents of $31.4 million. During the fourth quarter, we completed our previously announced sale-leaseback transaction with SR Aviation infrastructure for our Bosman Yellowstone International Airport campus facilities. We also entered into a new senior secured facility for up to $331.5 million, led by Bain Capital's private credit group. Together, these transactions were used to refinance Bridger's $160 million municipal bond with Gallaton County and consolidate the majority of our other existing debt.

Most importantly, our new credit facility provides significant capacity and financial flexibility through a delayed draw facility of up to $100 million designed to fund future fleet expansion to support the economic growth we are pushing.

Let me now turn the call over to Anne Hays, our incoming CFO, to go of our 2026 guidance.

Thanks, Eric. We are starting 2026 with the addition of 6 new aircraft on balance sheet. This consists of 2 previously leased PC-12 with contracts through 2027 and to King Air multi-mission aircraft and the 2 Spanish scoopers purchased in December. These new assets, coupled with increased utilization on the existing aircraft, will help us achieve growth of over 25% from last year when excluding the 2025 return to service work in Spain.

We are initiating 2026 guidance ranges of $135 million to $145 million for total revenues and $55 million to $60 million for adjusted EBITDA. The company also expects continued improvement in cash provided by operating activities in 2026 and positive net income.

Company is evaluating several different international operating contracts for the 2 scoopers that we closed in December, which are currently stationed in Spain. The contribution from the scoopers and the 2 new MMA aircraft is expected to be roughly 10% to 15% of 2026 revenue at an approximate 40% EBITDA margin. While we've had a good start to the year with 2 scoopers and 2 [ Airtech ] flying in late February, we expect to report a net loss in the first quarter due to the winter maintenance activity.

With that, I'll turn it back to Sam for final comments.

Thank you, Ann and Eric. As we announced in November, Eric is officially retiring at the end of the month, and Ann has taken over the CFO role officially on March 10. I want to again express our gratitude to Eric for his financial leadership over the last 3.5 years and his dedication to building Bridger into the resilient and profitable company that it is.

I also want to take the opportunity to say how excited we all are to welcome Anne Hayes officially as our new CFO and having joined us after serving as Audit Chair of our Board of Directors. She is ideally suited to lead us through our next chapter of growth and is clearly bought into the mission, evidenced by her step from 1 chair to join the Bridger team.

I also want to welcome Bill Andrews, our new Chief Operating Officer, announced earlier this week. He joined us most recently from Lockheed Martin as Vice President and Executive Program Manager for C-130s and P5s and P3s from development to support because the U.S. Air Force and Air National Guard veteran for over 25 years, he served as an aircraft commander and C-130 evaluator pilot.

We're privileged to have him join us both for his stellar career and his exemplary military service, which are an incredible fit for the Bridger mission. He has the right skill set to help grow Bridger into a robust and scalable organization.

Having led multibillion-dollar programs at Lockheed Martin across aircraft delivery, upgrade, support and readiness initiatives, he is exactly who we need to grow our organization in size and year-round operation. This includes its experience supporting the C-130 mat aerial firefighting aircraft for the California Air National Guard. We also see his unique service and support in the defense space is instrumental as we pursue additional opportunities adjacent to our firefighting missions.

To recap 2025, we flew in 21 states. We provided support for 380 fires and dropped 7.3 million gallons of water. We had the earliest deployment in customer history with Cooper's dispatching to the Palisades fire in California in January.

Across the fleet, we flew record hours greater than 10% above 2024 in a relatively slow fire year. And when we came home from the field in November, we had maintained 96% up time on contracts had driven 125,000 miles in our support vehicles. And most notably, every Burger employee came home safe.

As we sit here today, 3 of Bridger scoopers have completed winter maintenance and 2 of those are already responding to early season wildfire activity in Texas. One MMA is on contract in Oklahoma and 1 Arata us in Texas. Aircraft are on standby here in Bosman preparing work for early 2026. The remaining 3 scoopers are finishing up winter maintenance and should be ready over the course of the second quarter. Our stage winter maintenance program ensures we can provide flexibility within our fleet, utilize the excess capacity of our scoopers and deliver year-round readiness.

Legislation and greater appropriations to prioritize preparedness, early detection and suppression are making a difference to how we fight wildfire, and Bridger is uniquely positioned to support our federal and state customers. As Anne stated, we are on track for another record year, supported by a much improved balance sheet with significant capacity and financial flexibility to fund future fleet expansion, expansion to drive organic growth and build on our long-term vision to innovate and deploy the most advanced technology in our industry and deliver on our mission to protect lives property critical infrastructure and the environment.

Together, our team is ready to answer the call to serve year-round. We're excited for and positioned to make 2026 another incredible year.

With that, I'd like to open up the call to the operator for any lquestions.

[Operator Instructions] Our first question comes from Austin Moeller with Canaccord.

So just my first question, I was going to ask about the appointment of Bill Andrews. Is the intent there for him to help build out the FMS business? Or does this potentially signal that you might buy like C-130s or other government aircraft after the recent legislation that permits that?

Yes. So primarily, Bill's focus is -- good to talk to you again, Austin. Thanks for the question. primarily Bill's focus is going to be on making sure that our fleet is deployed and ready to go year-round across the country and really focus on our operational excellence and build upon that.

But it's more aligned with your first comment where we're looking at all of the expertise and the years of experience he has a leading very large programs, obviously, at a much different scale that he can bring that context into the Bridger family.

And we're uniquely positioned, I think, with our integrated services to do defense work adjacent to the mission we're doing in firefighting with all of the services we have in-house and really taking the opportunity with the funding going on in the defense space and the work that we have in the team and have Bill help identify and lead the team to capitalize on some of that.

There's a lot of appropriately-sized work for us to do, both on modification, flight test and design to go after defense work and other smaller jobs that maybe the larger primes can't quite capture. And we have the quick ability to do turnkey solutions, and FMS is a key part of that.

Okay. And can you give us any update on the return to service work for the second 2 Super Scoopers being worked on under MAB funding when they might be returned to service and you could potentially purchase and take ownership of those aircraft?

Yes. Great question. So I think last we left off, the third aircraft is quite near certification of airworthiness. And so there's a clear opportunity if we're focused on the first 2 getting firefighting work in Europe this year and then exploring potentially moving them even back to North America for fighting fire in the future.

So the third is near completion, and that obviously makes that a much closer target for us from an acquisition perspective. The fourth is a little bit further out. we're sourcing parts and working to get that underway that would probably be a little bit later in the year, if not towards the end of the year, that we would get that complete.

But again, focusing on folding in the first 2 to doing firefighting. And 3 and fourth are a nice dovetail in to work that we find for the first pair.

Okay. And just one more here. Can you speak to the potential contract opportunities in Europe? Which ones you -- which countries you think are perhaps the highest probability that you could get deployed in advance of the fire season in Q2?

Yes. And I'll be as direct as I can be without being too speculative or leading here because we're in communication and negotiations. But the 2 leading countries, I would say, that have shown great interest in committing to the scoopers station in Spain would be Portugal and Turkey.

We're working with our partner, overseas in Europe, Avincis that has helped us both on the return to service work and flight operations to pursue those countries with the economics we have in mind together as well as the mentality of the first come first serve basis as they get set up for the fire season.

In terms of timing, the appropriations are a little bit later than a deal in Europe, not as quite as early as a commitment as you get in the U.S. So we're hoping to have something in line and defined by March or maybe end of April. So that's kind of the timeline we're managing to. There are other countries that would be interested. They just haven't gone as far down their appropriation cycle as the first 2.

[Operator Instructions] Thank you. At this time, there are no further questions in queue. I will now turn the meeting back to Sam Davis for any additional or closing remarks. And my apologies. We actually did get an additional question. We'll move to Mark Williams with emerginggrowth.com.

Great. Congratulations on another strong quarter. Just real quick, with the 2026 guidance removing the return to service, revenue and profitability from that, how should we think about normalized EBITDA margins across core missions? And what will be driving the expansion forecasted?

Yes. Thanks, Mark, and I appreciate you asking the question. I'll answer kind of the first part, and then I'll let Ann jump in if she can.

We're focused on the expansion with the expanded capacity in the current fleet we have and capitalizing more on the margins with the core fleet, not including the return to service as you mentioned. So improving both the utilization, including the days and hours we have on contract for our scoopers and aircraft in hand as well as the addition of to scoopers in Spain, which we're factoring in as well as 2 additional sensor enhanced planes. We will add to contract here shortly.

And as everybody should know on the call, those sensor enhanced planes have quite attractive margin versus nonsensor enhanced. So continuing to drive those margins up overall, an improvement.

Anne, I don't know if there's anything else you want to add there.

Yes. No. So we had -- in 2025, we had about $14 million in revenue from the return to service. So we're increasing 29% when excluding that in 2026. And as far as the margins, as Sam mentioned, our scoopers are generally over 40% adjusted EBITDA margin. and our newer MMA aircraft can be as high as 40 to 50 or above. So any aircraft that we're adding at this point are increasing EBITDA margins compared to the more simple air attach that did not have the sensors could have a lower EBITDA margin

Okay. Great. And then along those lines, maintenance expenses increased in 2025 as aircraft were added and with the addition of the new aircraft, how should we think about how expenses, maintenance should scale with those aircraft?

Great. I'll take the first part of this, Mark again and then let Anne put some numbers behind it.

But excluding, again, the return to service, we see -- we saw less of an increase in our cost of revenue as opposed to the revenue that we saw year-over-year and continue to see that as we set guidance for this year because we're seeing more economies of scale as the fleet grows and we become more efficient with spend.

There were some additional cost -- variable costs that are associated with being deployed more and having more activities such as travel, obviously, wear and tear on aircraft and more of the maintenance intervals that we have to perform. However, it grows at a less of a rate than the revenue grows. So we have that factored into a more profitable gross profit this year with our core fleet and the aircraft that we're adding.

Yes. I would just add that in 2025, the aircraft maintenance did include that Spain return to service work. So we will see that decrease in 2026. And we are seeing margins, as mentioned earlier, with that decrease and the high-margin aircraft, we are seeing margins increase.

Okay. Great. And then last question, just real quick. With the refinancing and the liquidity available under the that occurred this past year, do you see any need for additional funding throughout the next year or 2 or especially bringing on the 2 new scoopers I don't know if they were funded under the DDTL or part of other parts of that funding that...

Yes. So good question. The DDTL that we have in hand, which it closed was $100 million, we built that around what we see for the next couple of years in terms of opportunity of aircraft that we could go out and add 2 contracts and contribute the same as the fleet we have, which does include aircraft 3 and 4 scoped into that amount.

So we don't yet foresee any problem of outpacing of our growth outpacing that from an aircraft acquisition perspective. we could obviously revisit that if the demand necessitated that many aircraft. But right now, including the aircraft we added at the end of the year, that was factored into the model at the time we closed it. And so we're on pace for that. And that, again, is a good outlook for us for the next couple of years.

Well, just real quick, Mark. Just the other thing to add. So the purchase for the first 2 Spanish scoopers was included in the overall term loan. So we didn't tap the deferred draw facility for those.

And to Sam's point, the 2 surveillance aircraft we added at the end of the year did come out of the DDTL facility, but there's still about $90 million left in it. So the first 2 scannacoopers came out of the term loan that's already on the balance sheet, and we still have, like I said, about $90 million of capacity on that deferred draw facility.

There are no further questions at this time. I'd now like to turn it back to Sam Davis for any additional or closing remarks.

Thank you. Thanks again for joining our conference call today. We look forward to updating you on our progress when we report our Q1 results in May. If anyone has any follow-up questions, please reach out to our Investor Relations. Thanks, and have a good day.

Thank you. This brings us to the end of today's meeting. We appreciate your time and participation. You may now disconnect.

Greetings, and welcome to the Bridger Aerospace Third Quarter Fiscal 2025 Investor Conference Call. As a reminder, today's call is being recorded.

It is now my pleasure to introduce your host, Eric Gerratt, Chief Financial Officer. Thank you. Mr. Gerratt, you may begin.

Good afternoon, and thanks for joining us today. Joining me on the call this afternoon is Chief Executive Officer, Sam Davis. Before we begin, please note that certain statements contained in this conference call that do not describe historical facts are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995.

Since forward-looking statements are based on various assumptions, risks and uncertainties, actual results may differ materially from those expressed or implied by such statements. Factors that could cause results to differ materially from those expressed include, but are not limited to, those discussed in the company's filings with the U.S. Securities and Exchange Commission, including expectations regarding financial results for 2025.

Management cannot control or predict many factors that impact future results. Listeners should not place undue reliance on forward-looking statements, which reflect management's views only as of today. We anticipate that subsequent events and developments will cause our assessments to change. However, we undertake no obligation to revise or update any forward-looking statements or make any other forward-looking statements.

Throughout this afternoon's earnings release and call today, we refer to the non-GAAP financial measure adjusted EBITDA. The definition, calculation and a reconciliation to the financial statements of adjusted EBITDA can be found in Exhibit A of our earnings release, which is available on our website. We believe adjusted EBITDA is useful in evaluating our reported results as a supplement to and not a substitute for reported results under GAAP.

With that, I'd like to turn the call over to Sam.

Thank you, Eric. This year has been an incredibly strong year for Bridger, both operationally and financially. Operationally, we saw record task orders that ran through October. Utilization measured in days on contract is up almost 10% year-over-year across the fleet.

Our multi-mission aircraft have almost doubled their flight hours year-over-year and were extended beyond their guaranteed 150 days a piece to greater than 220 days a piece. Bridger Super Scoopers continue to gain recognition for their effectiveness as the ideal initial attack asset, and the Forest Service has been proactive in prepositioning our assets. Our scoopers have seen nearly a 9% increase in average flight hours year-to-date.

The benefits of a proactive response to wildfire this year are clearly visible. Through October 10, according to the National Interagency Fire Center, or NIFC, wildfires have been above average in count with over 54,000 incidents this year up to date -- year-to-date, up 50% over last year and 15% above the 10-year average. Yet despite the increased number of fires, the NIFC reported only 4.7 million acres burned, which is down 40% over last year and down 29% from the 10-year average.

This year's tremendous operational performance has lent itself to an incredible financial year as well. The more effective and tactical adoption of our assets has contributed to us surpassing our annual revenue guidance in the first 9 months of the year. Additionally, we remain on track to meet the high end of our adjusted EBITDA guidance. Bridger's 2025 financial performance saw the impact of our focus on developing long-term contracts with both the Forest Service and individual states.

This concentration has led to another record-breaking quarter and another record-breaking year in spite of a statistically below average fire year. These third quarter results are a validation of the impact that these efforts are having on our business model. We see this as a strong indicator that as a nation, our assets are becoming increasingly important tools in the toolbox.

And as a company, we are building resiliency in our revenue. As the threat of wildfire grows, Bridger remains ready to respond and focused on our mission to protect lives, property, critical infrastructure and the environment. These strong operational and financial results and our expectations for a second record year made it possible for us to complete a balance sheet transformation last week.

We completed a $49 million sale leaseback of our campus facilities in Belgrade, Montana and entered into a new $331 million expanded debt facility with increased capacity for growth. Most importantly, we now have the financial flexibility to acquire the aircraft needed to support contract expansion opportunities and to serve all of our customers, whether federal, state, local or defense to further drive EBITDA growth and long-term shareholder value.

Bridger's commitment to financial health and resilience is positioning us to better serve and protect this country. Let me now provide a quick update on FMS and Ignis. FMS contributed $2.4 million in revenue during the third quarter. In addition to partnering on the internal aircraft modifications to solidify our competitive edge, we continue to see a number of contracting opportunities, primarily with the DoD in active bids that Bridger and FMS are uniquely positioned to respond to.

In addition to awarded work with our partner, Positive Aviation for the FF72 aircraft certification program, recent wins include a small award with the U.S. Air Force. While revenue in FMS business has seen delays due to federal budgeting uncertainties for the short term, we remain optimistic and FMS remains well positioned for a wide range of defense as well as commercial work.

We're in the middle of repurposing our business development team to target this work. Much of the opportunities are fairly small and strategic with the potential to scale into larger volume of nonfire, nonseasonal complementary work to the services we already provide. We hope to add more year-round revenue growth to the business later this year and in 2026.

A brief update on Ignis Technologies. Since launching its mobile platform to support firefighters in the field over a year ago, pilot programs utilizing the platform with counties, crews and incident management teams continue. We are now linking Bridger's real-time sensor imagery with the Ignis app, creating a seamless data flow from air to ground.

During the third quarter, we live streamed video of the Dragon Bravo Fire in Arizona from our PC-12 to the Secretary of the Interiors office. This capability is unlocking new levels of situational awareness, supporting multi-mission aviation contracts and enhancing both operational effectiveness and safety. With the continued success of our sensor-enhanced aircraft in the field, the need for interactive live data streaming is stronger than ever, and we intend for this to be a critical part of our sensor-enhanced aviation contracts next year.

Turning to the Spanish Scoopers, which are owned under a partnership agreement with MAB Funding LLC. The aircraft's return to service work by our Spanish subsidiary, Albacete Aero continues to progress. Having received the certificate of airworthiness, the first 2 aircraft have been flying this summer on contract with the government of Portugal. This has been supported by a lease arrangement between MAB as the owner and Avinci as the operator.

With our recent financing completed, which provides funds for the aircraft acquisition, we now have the opportunity to potentially bring these 2 scoopers onto our balance sheet in the near future. The third and fourth scoopers continue to undergo the final stages of their respective return to service work and are scheduled to be ready in early 2026, at which time we will enter into discussions with MAB to potentially acquire these aircraft as well.

Before I turn the call over to Eric, I want to reiterate the opportunity for Bridger given the recent federal initiatives to restructure our national Wildland firefighting system, which we view as the market shift for the entire industry. The establishment of the Wildland Fire Service Plan and passage of the Fire Ready Nation Act are focused on improving wildfire response and driving future growth.

This comes on the heels of the executive order early in the year that called for the establishment of a national Wildland firefighting task force. We have already noticed faster response times, standards of cover and a more comprehensive mix of aviation assets being demanded.

With Bridger's significant air attack fleet, including modern fire imaging and surveillance aircraft and the world's largest private super scooper fleet, we believe we are uniquely positioned as the nation refocuses efforts on preparedness and aggressive wildfire suppression to detect, prevent, contain and extinguish wildfires before they become the next catastrophic event.

This commitment on top of the 2026 budget for the new U.S. Wildland Fire Service that calls for a threefold increase in funding to $3.7 billion will have a significant positive impact on the entire wildland fire community. We continue to actively look for opportunities with states to provide exclusive use of our firefighting assets, and we remain optimistic that our current budgeting and planning cycles will lead to future opportunities. It has been an incredible 2025 thus far, and I remain grateful I get to lead this exceptional team.

Let me now turn it back to Eric, who will talk about our strong financial performance in the quarter.

Thank you, Sam. Looking at our results for the third quarter of 2025, revenue increased to a record $67.9 million, up 5% from $64.5 million in the third quarter of 2024. The third quarter of 2025 benefited from continued high levels of activity as multiple scoopers and surveillance aircraft were deployed throughout the quarter.

Excluding revenue from the return to service work performed on the 4 Spanish Scoopers as part of our partnership agreement with MAB Funding, LLC, which was $2.1 million in the first quarter of 2025 and $2.1 million in the third quarter of 2024, revenue from ongoing operations, including FMS, grew 5% to approximately $65.7 million compared to $62.4 million in the third quarter of 2024.

Cost of revenues was $21.1 million in the third quarter of 2025, and was comprised of flight operations expenses of $12.1 million and maintenance expenses of $9 million. This compares to $23 million in the third quarter of 2024, which included $15.1 million of flight operations expenses and $7.9 million of maintenance expenses.

Cost of revenues associated with the return to service work on the Spanish Super Scoopers was consistent for the third quarter of 2025 when compared to the third quarter of 2024. Selling, general and administrative expenses were $7.7 million in the third quarter of 2025 compared to $8.6 million in the third quarter of 2024. The decline reflects lower noncash stock-based compensation expense and a decrease in earn-out consideration, which was partially offset by an increase in the fair value of our warrants.

Interest expense for the third quarter was $5.8 million compared to $6 million in the third quarter last year. For the third quarter of 2025, we reported net income of $34.5 million compared to net income of $27.3 million in the third quarter of 2024. Earnings per diluted share was $0.37 for the third quarter this year compared to $0.31 per diluted share in the third quarter last year.

Adjusted EBITDA was $49.1 million in the third quarter of 2025 compared to $47 million in the third quarter last year. A reconciliation of adjusted EBITDA to net income is included in Exhibit A of our earnings release distributed earlier today. Now looking at our results for the first 9 months of 2025. Revenue was $114.3 million compared to $83 million in the first 9 months of 2024, a 38% increase.

Excluding return to service work, revenue was $101.1 million compared to $78 million in the first 9 months of 2024, up 30%. Cost of revenues was $57 million, which comprised flight operation expenses of $26.2 million and maintenance expenses of $30.8 million. Cost of revenues for the first 9 months of 2024 was $42.1 million and comprised $25.2 million of flight operation expenses and maintenance expenses of $16.8 million.

Cost of revenues for the first 9 months of 2025 included an increase of approximately $9.6 million of expenses associated with the return to service work for the Spanish Super Scoopers compared to the first 9 months of 2024. SG&A expenses were $22.8 million compared to $28.2 million in the first 9 months of 2024, with the decrease again driven by lower noncash stock-based compensation expense and a decrease in our earn-out consideration, which was partially offset by an increase in the fair value of our warrants.

Interest expense for the first 9 months of 2025 was $17.3 million compared to $17.8 million in the first 9 months of 2024. Bridger also reported other income of $1.8 million in the first 9 months of 2025, which was consistent with the $1.8 million reported in the first 9 months of 2024. Net income was $19.3 million in the first 9 months of 2025 compared to a net loss of $2.7 million in the first 9 months of 2024.

Adjusted EBITDA was $54.8 million in the first 9 months this year compared to $40.2 million in the same period last year. Now turning to the balance sheet. We ended Q3 with total cash and cash equivalents of $55.1 million. After the end of the quarter, we completed our previously announced sale-leaseback transaction with SR Aviation Infrastructure for our Bozeman Yellowstone International Airport campus facilities. The sales price was approximately $49 million.

In addition, last week, we also executed a new senior secured credit facility for up to $331.5 million. Together, these transactions were used to refinance Bridger's $160 million municipal bond with Gallatin County, consolidate the majority of our existing debt and most importantly, provide significant capacity and financial flexibility through a delayed draw facility designed to fund future fleet expansion to support the organic growth we are pursuing.

Turning to our guidance. With the strong fleet utilization year-to-date, including record task orders for our Super Scoopers, we remain on track to end 2025 at the higher end of our guidance range of $42 million to $48 million of adjusted EBITDA. Revenue has already exceeded the top end of our previous guidance range of $105 million to $111 million and is now expected to be between $118 million and $123 million. The company also expects continued improvement in cash provided by operating activities in 2025.

Now with that, I'd like to turn the call back to Sam for final comments.

Thank you, Eric. This year-to-date, we have flown in 21 states, provided support for 380 fires and dropped 7.3 million gallons of water. The increased focus on preparedness, early detection and suppression is making a difference from suppression on major fires to prevent the loss of structures to early detection, preventing small lightning strikes from becoming large incidents.

Our team continues to execute. As we sit here today, 3 of Bridger scoopers and 4 air attack aircrafts are on standby for late call out, and we stand ready to finish the 2025 season strong and prepared for year-round work during these winter months. Three scoopers have entered winter maintenance to ensure we can provide flexibility within our fleet and be able to respond early in 2026, if necessary, and enable us to more fully utilize the excess capacity of our scoopers.

And as Eric stated, with our record 9-month results, we have already exceeded our revenue guidance for the full year and remain confident we will hit the higher end of our annual adjusted EBITDA guidance after assuming the loss typically booked in the fourth quarter. With the monetization of our campus and the new $331 million debt facility, we have consolidated our debt and are now able to reinvest in the business.

We have significant capacity and financial flexibility to fund future fleet expansion, drive our organic growth and build on our long-term vision to innovate and deploy the most advanced technology in our industry and deliver on our mission to protect lives, property, critical infrastructure and the environment.

And with the support of our federal and government customers, legislation to prioritize early attack and suppression and additional budget dollars appropriated, we're incredibly well positioned to report another year of positive cash flows as we focus on generating solid returns for our stakeholders.

I would be remiss to not express my appreciation and celebrate the success of the incredible Bridger team from our senior leadership to our pilots, from mechanics to drivers and all the folks behind the scenes, maximizing our safety and effective operations all around the country. Bridger's mission attracts and retains the best employees in the country, and they're all critical in delivering the results we've had quarter after quarter, and we're ready to answer the call to serve year-round.

We're excited for and positioned to make 2026 yet another incredible year. And with that, I'd like to ask the operator to open the call for any questions.

[Operator Instructions] Our first question comes from Austin Moeller with Canaccord.

Nice quarter. So you have about $14 million free cash flow year-to-date. How much are you tracking towards by end of year? And what do you plan to use the cash for?

Austin, good to hear from you. I will turn that to Eric as CFO, to answer that question.

Yes, Austin, I think we'll end the year around that same amount or maybe a little north of that. As you know, fourth quarter, we go into the maintenance cycle. And typically, in the fourth quarter, we don't see as much revenue certainly as we saw in the third quarter or even the second quarter.

So I expect it to remain at about that level. And what we'll be doing with that free cash flow is, again, we'll be looking at our fleet expansion opportunities in conjunction with the new credit facility and how best to deploy that capital.

Okay. And now that the credit facility is in place and the sale leaseback is complete, do you expect the Spanish scoopers to be staying in Europe or coming to the U.S.A.?

That's a great question, Austin. We're exploring all avenues there. I can say that with that now being a reality, and us having those discussions right now to see how quickly we can move on that. We're going to go with kind of the best both strategic and economic benefit for us, and we'll run all those paths. It's hard for me to predict with a crystal ball what that's going to be.

But I will say that the beauty of it is they're a very scarce asset and in high demand. So that gives us a lot of optionality to have those aircraft, especially with those two being airworthy and flying a partial season already, Bridger sees a lot of opportunity to put those to work. And we'll know a lot more through the winter months as we nail down the best opportunity. And the beauty of it is we have optionality of where we place them.

[Operator Instructions] At this time, there are no further questions in the queue. I will now be turning the meeting back to Sam Davis.

Thank you. Thanks again for joining our conference call today. We look forward to updating you on our progress when we report our Q4 results in March. We're scheduled to participate in Sidoti's year-end Virtual Investor Conference on December 10 and 11, with our presentation scheduled for 4:00 p.m. Eastern Time on Wednesday, the 10.

In addition to the presentation there will be 2 days of virtual one-on-ones. And hopefully, we can have -- connect with some of you then. Additionally, if anyone has any follow-up questions, as always, please feel free to reach out to our Investor Relations, and we can set up some further communication. Thank you, and we can close the call.

Thank you. This brings us to the end of today's meeting. We appreciate your time and participation. You may now disconnect.