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BAER Stock Gains Following Q3 Earnings Uptick Y/Y, Gross Margin Down

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Bridger Aerospace Group Holdings, Inc. (BAER - Free Report) reported an earnings per share (EPS) of 31 cents in the third quarter of 2024, up 40.9% from the year-ago quarter’s EPS of 22 cents.

BAER’s Revenues in Detail

Bridger Aerospace registered revenues of $64.5 million in the third quarter, up 20.3% year over year.

Revenues in the reported quarter benefited from higher flight revenues, $2.2 million related to return-to-service work performed on the four Spanish Super Scoopers as part of Bridger Aerospace’s partnership agreement with MAB Funding LLC and $1.6 million from the company’s June acquisition of FMS Aerospace (“FMS”).

Shares of this company gained nearly 24.6% in yesterday’s after-hours trading.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

Bridger Aerospace’s Gross Margin

In the quarter under review, Bridger Aerospace’s gross profit rose 10.2% year over year to $41.5 million. However, the gross margin contracted 587 basis points (bps) to 64.3%.

BAER’s Operating Expenses Analysis

Selling, general and administrative expenses declined 42.6% year over year to $8.6 million.

Bridger Aerospace’s Profitability

Operating profit totaled $32.9 million, reflecting a 45.5% increase from the prior-year quarter. The operating margin in the third quarter expanded 883 bps to 50.9%.

In the third quarter, Bridger Aerospace’s net income was $27.3 million, up 56.4% from the prior-year quarter.

Adjusted EBITDA during the reported quarter was $46.9 million, up 21.3% from the year-ago quarter.

BAER’s Liquidity & Debt Management

Bridger Aerospace exited third-quarter 2024 with cash and cash equivalents of $33.3 million compared with $8.5 million at the second-quarter end. Total debt at the end of third-quarter 2024 was $205.2 million compared with $205.7 million at the second-quarter end.

Cumulative net cash provided by operating activities at the end of third-quarter 2024 was $0.2 million against the cumulative net cash used in operating activities of $41.5 million a year ago.

Bridger Aerospace’s Guidance

Bridger Aerospace has revised its full-year guidance.

For 2024, total revenues are now expected to be between $90 million and $95 million (reflecting an increase of 35-42% from the comparable 2023 figures), up from the prior outlook of $70- million-$86 million.

Adjusted EBITDA for 2024 is now projected to lie between $35 million and $40 million (up by more than 85% from the comparable 2023 figures), narrowed from the prior outlook of $35 million-$51 million.

Our Take

Bridger Aerospace exited the third quarter of 2024 with impressive top-line and bottom-line results. Revenue contribution from the company’s acquired FMS business was also encouraging.

Management confirmed that BAER’s Super Scooper fleet experienced its highest level of utilization during the third quarter, with multiple Super Scoopers flying into November. Also, the company’s international expansion into Spain is currently on track, with the first two Super Scoopers nearing completion of their return-to-service work. These look promising for the stock.

However, the gross margin contracted during the reported quarter, which did not bode well.


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