[FORM 8-K General Information](index=1&type=section&id=FORM%208-K%20General%20Information) This section provides fundamental identification details for the Form 8-K filing, including registrant information and company status [Registrant and Filing Details](index=1&type=section&id=Registrant%20and%20Filing%20Details) This section provides the basic identification details for the Form 8-K filing, including the registrant's name, jurisdiction, and address - Company Name: **Sky Harbour Group Corporation**[1](index=1&type=chunk) - Jurisdiction of incorporation: **Delaware**[2](index=2&type=chunk) - Principal executive offices address: **136 Tower Road, Suite 205, Westchester County Airport, White Plains, NY 10604**[2](index=2&type=chunk) [Securities Registered](index=1&type=section&id=Securities%20Registered) Details the classes of securities registered pursuant to Section 12(b) of the Act, including their trading symbols and the exchange on which they are registered Securities Registered | Title of each class | Trading Symbol(s) | Name of each exchange on which registered | | :------------------ | :---------------- | :---------------------------------------- | | Class A common stock, par value $0.0001 per share | SKYH | The New York Stock Exchange | | Warrants, each whole warrant exercisable for one share of Class A common stock at an exercise price of $11.50 per share | SKYH WS | The New York Stock Exchange | [Emerging Growth Company Status](index=1&type=section&id=Emerging%20Growth%20Company%20Status) Indicates the registrant's status as an emerging growth company and its election regarding new financial accounting standards - Sky Harbour Group Corporation is an **"Emerging growth company"**[4](index=4&type=chunk) - The registrant has not elected not to use the extended transition period for complying with any new or revised financial accounting standards, implying it is **utilizing the extended transition period**[4](index=4&type=chunk) [Item 2.02. Results of Operations and Financial Condition](index=3&type=section&id=Item%202.02.%20Results%20of%20Operations%20and%20Financial%20Condition) This section details the announcement of financial results and clarifies the nature and limitations of the furnished information [Announcement of Financial Results and Investor Presentation](index=3&type=section&id=Announcement%20of%20Financial%20Results%20and%20Investor%20Presentation) Sky Harbour Group Corporation announced its financial results for the three and six months ended June 30, 2025, via a press release and investor presentation - Sky Harbour Group Corporation issued a press release on **August 12, 2025**, announcing financial results for the three and six months ended **June 30, 2025**[5](index=5&type=chunk) - An investor presentation was furnished to stakeholders at a scheduled investor meeting on **August 12, 2025**[6](index=6&type=chunk) - A copy of the Press Release (Exhibit 99.1) and Investor Presentation (Exhibit 99.2) is furnished and incorporated into this Item 2.02 by reference[5](index=5&type=chunk)[6](index=6&type=chunk) [Nature and Limitations of Furnished Information](index=3&type=section&id=Nature%20and%20Limitations%20of%20Furnished%20Information) The company clarifies that the furnished press release and investor presentation are summary information and not deemed "filed" for certain liabilities - The information in the Press Release and Investor Presentation is summary information, intended to be considered in the context of more complete SEC filings[7](index=7&type=chunk) - The information in Item 2.02, including Exhibits 99.1 and 99.2, shall not be deemed **"filed"** for purposes of Section 18 of the Exchange Act or Sections 11 and 12(a)(2) of the Securities Act[8](index=8&type=chunk) - The Company undertakes no duty or obligation to update or revise the information contained in this report[7](index=7&type=chunk) [Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers](index=3&type=section&id=Item%205.02.%20Departure%20of%20Directors%20or%20Certain%20Officers%3B%20Election%20of%20Directors%3B%20Appointment%20of%20Certain%20Officers%3B%20Compensatory%20Arrangements%20of%20Certain%20Officers) This section reports the departure of a key officer and the associated compensatory arrangements [Departure of Chief Operating Officer](index=3&type=section&id=Departure%20of%20Chief%20Operating%20Officer) Willard Whitesell, COO, stepped down by mutual agreement, with his unvested RSUs fully vesting pro rata - Willard Whitesell, Chief Operating Officer and leader of the Company's construction division, stepped down by mutual agreement, effective **August 8, 2025**[9](index=9&type=chunk) - A Separation Agreement and General Release was entered into, effective **August 8, 2025**, in connection with Mr. Whitesell's departure[9](index=9&type=chunk) - All unvested restricted stock units (RSUs) held by Mr. Whitesell will become **fully vested** as of the separation date and will be delivered in shares of Class A common stock on a pro rata monthly basis[9](index=9&type=chunk) - Mr. Whitesell's departure is not the result of any disagreement with the Company on matters related to his performance or the Company's operations, policies, or procedures[9](index=9&type=chunk) [Cautionary Statement Regarding Forward-Looking Statements](index=3&type=section&id=Cautionary%20Statement%20Regarding%20Forward-Looking%20Statements) This section provides a standard disclaimer about forward-looking statements, highlighting inherent risks and uncertainties [Forward-Looking Statements Disclaimer](index=3&type=section&id=Forward-Looking%20Statements%20Disclaimer) This section provides a standard cautionary statement regarding forward-looking statements, highlighting inherent risks and uncertainties - This Current Report on Form 8-K includes **"forward-looking statements"** within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995[10](index=10&type=chunk) - These statements are based on current expectations and involve risks and uncertainties that may cause actual results to differ significantly[10](index=10&type=chunk) - The Company does not assume any obligation to update or revise any such forward-looking statements[10](index=10&type=chunk) - Readers are cautioned not to put undue reliance on forward-looking statements, and important factors causing differences are described in the **"Risk Factors"** section of the Company's Annual Report on Form 10-K[10](index=10&type=chunk) [Item 9.01. Financial Statements and Exhibits](index=4&type=section&id=Item%209.01.%20Financial%20Statements%20and%20Exhibits) This section lists the exhibits accompanying the Form 8-K filing and includes the report's signature details [Exhibit Index](index=4&type=section&id=Exhibit%20Index) Provides a list of exhibits accompanying the Form 8-K filing, including the press release, investor presentation, and interactive data file Exhibit Index | Exhibit Number | Exhibit Title | | :------------- | :------------ | | 99.1 | Press Release dated August 12, 2025 | | 99.2 | Investor Presentation dated August 12, 2025 | | 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | [Signature](index=4&type=section&id=Signature) The report is duly signed on behalf of Sky Harbour Group Corporation by its Chief Executive Officer - The report was signed on **August 12, 2025**[16](index=16&type=chunk) - Signed by **Tal Keinan**, Chief Executive Officer of Sky Harbour Group Corporation[16](index=16&type=chunk)

[PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section presents the unaudited consolidated financial statements and management's discussion and analysis for Sky Harbour Group Corporation [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited consolidated financial statements of Sky Harbour Group Corporation and its subsidiaries for the period ended June 30, 2025, including balance sheets, statements of operations, comprehensive income, stockholders' equity, and cash flows, along with detailed notes explaining accounting policies and specific financial line items [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) Presents the company's financial position, highlighting assets, liabilities, and equity at specific dates Consolidated Balance Sheet Highlights (in thousands) | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | Change | | :-------------------------------- | :----------------------------- | :------------------------------- | :-------------------------------- | | Total Assets | $568,139 | $556,556 | +$11,583 | | Cash | $8,610 | $42,442 | -$33,832 | | Constructed Assets, net | $211,393 | $110,302 | +$101,091 | | Cost of Construction | $84,102 | $144,900 | -$60,798 | | Total Liabilities | $401,094 | $396,738 | +$4,356 | | Warrants Liability | $26,856 | $46,130 | -$19,274 | | Total Equity | $167,045 | $159,818 | +$7,227 | [Consolidated Statements of Operations](index=5&type=section&id=Consolidated%20Statements%20of%20Operations) Details the company's revenues, expenses, and net income or loss over specific reporting periods Consolidated Statements of Operations Highlights (in thousands, except per share data) | Metric (in thousands, except per share data) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | Change (YoY) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | Change (YoY) | | :------------------------------------------- | :--------------------------- | :--------------------------- | :------------- | :--------------------------- | :--------------------------- | :------------- | | Total Revenue | $6,588 | $3,618 | +82% | $12,180 | $6,022 | +102% | | Operating Loss | $(7,528) | $(4,958) | -52% | $(14,352) | $(10,182) | -41% | | Net Income (Loss) attributable to SHG shareholders | $17,453 | $5,761 | +203% | $11,077 | $(13,178) | N/A | | Basic EPS | $0.52 | $0.23 | +126% | $0.33 | $(0.54) | N/A | | Diluted EPS | $0.18 | $0.06 | +200% | $0.07 | $(0.54) | N/A | [Consolidated Statements of Comprehensive Income (Loss)](index=6&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) Reports net income and other comprehensive income items, reflecting changes in equity from non-owner sources Consolidated Statements of Comprehensive Income (Loss) Highlights (in thousands) | Metric (in thousands) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | Change (YoY) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | Change (YoY) | | :-------------------- | :--------------------------- | :--------------------------- | :------------- | :--------------------------- | :--------------------------- | :------------- | | Net income (loss) | $14,356 | $4,163 | +245% | $5,230 | $(17,036) | N/A | | Unrealized gains on available-for-sale securities | $70 | $67 | +4% | $70 | $462 | -85% | | Realized gains on available-for-sale securities reclassified | $0 | $(690) | N/A | $(53) | $(707) | -92% | | Total comprehensive income (loss) | $14,426 | $3,540 | +307% | $5,247 | $(17,281) | N/A | [Consolidated Statements of Stockholders' Equity](index=7&type=section&id=Consolidated%20Statements%20of%20Stockholders'%20Equity) Outlines changes in equity accounts, including common stock, additional paid-in capital, and accumulated deficit Consolidated Stockholders' Equity Highlights (in thousands, except share data) | Metric (in thousands, except share data) | June 30, 2025 | December 31, 2024 | Change | | :--------------------------------------- | :------------ | :---------------- | :----- | | Class A Common Stock Shares Outstanding | 33,835,373 | 33,456,227 | +379,146 | | Class B Common Stock Shares Outstanding | 42,046,356 | 42,046,356 | 0 | | Additional Paid-in Capital | $170,614 | $168,634 | +$1,980 | | Accumulated Deficit | $(53,515) | $(64,592) | +$11,077 | | Total Equity | $167,045 | $159,818 | +$7,227 | [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Summarizes cash inflows and outflows from operating, investing, and financing activities over a period Consolidated Statements of Cash Flows Highlights (in thousands) | Metric (in thousands) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | Change (YoY) | | :------------------------------------ | :--------------------------- | :--------------------------- | :------------- | | Net cash used in operating activities | $(5,994) | $(5,472) | -$522 | | Net cash (used in) provided by investing activities | $(54,803) | $54,535 | -$109,338 | | Net cash (used in) provided by financing activities | $(1,457) | $975 | -$2,432 | | Cash and restricted cash, end of period | $32,105 | $122,304 | -$90,199 | [Notes to Unaudited Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Unaudited%20Consolidated%20Financial%20Statements) Provides detailed explanations of accounting policies, estimates, and specific line items within the financial statements [Note 1. Organization and Business Operations](index=10&type=section&id=Note%201.%20Organization%20and%20Business%20Operations) Sky Harbour Group Corporation (SHG) operates as a holding company, with its primary business being aviation infrastructure development, leasing, and management of general aviation hangars across the U.S. The company uses an "Up-C" structure, where SHG owns 44.6% of Sky Common Units and prior holders control 55.4% through Class B Common Stock - SHG is an aviation infrastructure development company that develops, leases, and manages general aviation hangars for business aircraft across the United States[22](index=22&type=chunk) - The Company operates under an "Up-C" structure, with SHG owning approximately **44.6% of Sky Common Units**[22](index=22&type=chunk) - Prior holders of Sky Common Units own approximately **55.4%** and control the Company through their ownership of Class B Common Stock[22](index=22&type=chunk) [Note 2. Basis of Presentation and Summary of Significant Accounting Policies](index=10&type=section&id=Note%202.%20Basis%20of%20Presentation%20and%20Summary%20of%20Significant%20Accounting%20Policies) This note outlines the basis of presentation for the unaudited consolidated financial statements, prepared in conformity with SEC requirements for Form 10-Q and GAAP. It details significant accounting policies, including the use of estimates, risks and uncertainties, liquidity and capital resources, basis of consolidation, cost of construction, leases, warrants liability, revenue recognition, and income taxes, along with recently issued accounting pronouncements - Financial statements are prepared in conformity with SEC requirements for Form 10-Q and GAAP, excluding certain disclosures normally in audited statements[23](index=23&type=chunk) - The Company has reclassified certain historical amounts for current year presentation, including separate disclosure of rental and fuel revenue, and detailed operating expenses[24](index=24&type=chunk) - Key estimates include impairment analyses, useful lives of assets, fair value of financial instruments (warrants), ROU assets, operating lease liabilities, and fair value of acquired assets/liabilities[25](index=25&type=chunk) - The Company has incurred recurring losses and negative cash flows from operating activities since inception due to ongoing construction and business development, expecting this to continue in the near future[28](index=28&type=chunk) - The Company believes its liquidity is sufficient for continued operations for more than one year, funded by bond and equity offerings and an "at the market" offering program[29](index=29&type=chunk) - Recently issued accounting pronouncements include ASU No. 2023-09 (Income Taxes) and ASU No. 2024-03 (Expense Disaggregation Disclosures), with the Company evaluating their impact[45](index=45&type=chunk)[46](index=46&type=chunk) [Note 3. Investments and Restricted Investments](index=15&type=section&id=Note%203.%20Investments%20and%20Restricted%20Investments) The Company's investments primarily consist of U.S. Treasury securities, classified as available-for-sale or held-to-maturity (restricted). Investments are carried at fair value (Level 1 inputs) or amortized cost, with unrealized losses primarily due to interest rate changes, not credit risk - Investments in U.S. Treasury securities are classified as available-for-sale (fair value) or held-to-maturity (restricted, amortized cost)[47](index=47&type=chunk)[48](index=48&type=chunk) - Unrealized losses on investments are primarily due to changes in interest rates, not credit impairments[48](index=48&type=chunk) Investments and Restricted Investments (Fair Value, in thousands) | Investment Type | June 30, 2025 (Fair Value, in thousands) | December 31, 2024 (Fair Value, in thousands) | | :------------------------------ | :--------------------------------------- | :----------------------------------------- | | Investments, available for sale | $30,999 | $18,987 | | Restricted investments, held-to-maturity | $11,329 | $13,548 | [Note 4. Cost of Construction and Constructed Assets](index=16&type=section&id=Note%204.%20Cost%20of%20Construction%20and%20Constructed%20Assets) This note details the Company's constructed assets and costs of construction. Constructed assets, net, significantly increased due to completed projects, while costs of construction decreased as projects moved from development to operational status. Depreciation expense also rose substantially year-over-year - Constructed assets, net, increased to **$211,393 thousand** as of June 30, 2025, from **$110,302 thousand** as of December 31, 2024[50](index=50&type=chunk) - Cost of construction decreased to **$84,102 thousand** as of June 30, 2025, from **$144,900 thousand** as of December 31, 2024[50](index=50&type=chunk) - Depreciation expense for constructed assets for the six months ended June 30, 2025, totaled **$1,988 thousand**, up from **$898 thousand** in the prior year[50](index=50&type=chunk) [Note 5. Long-lived Assets and Lease Intangible Assets](index=16&type=section&id=Note%205.%20Long-lived%20Assets%20and%20Lease%20Intangible%20Assets) This note provides a breakdown of long-lived assets and lease intangible assets. Long-lived assets, net, increased, primarily due to purchase deposits and construction in progress. Lease intangible assets, net, saw a slight decrease, with associated amortization expense - Long-lived assets, net, increased to **$19,016 thousand** as of June 30, 2025, from **$14,732 thousand** as of December 31, 2024[51](index=51&type=chunk) - Purchase deposits and construction in progress within long-lived assets increased from **$2,380 thousand** to **$5,520 thousand**[51](index=51&type=chunk) - Lease intangible assets, net, decreased slightly to **$2,857 thousand** as of June 30, 2025, from **$3,005 thousand** as of December 31, 2024[52](index=52&type=chunk) - Amortization expense for lease intangible assets for the six months ended June 30, 2025, totaled **$148 thousand**[52](index=52&type=chunk) [Note 6. Supplemental Balance Sheet and Cash Flow Information](index=17&type=section&id=Note%206.%20Supplemental%20Balance%20Sheet%20and%20Cash%20Flow%20Information) This note provides supplemental details on accounts payable, accrued expenses, other liabilities, and non-cash investing and financing activities. It also reconciles cash and restricted cash - Accounts payable, accrued expenses, and other liabilities increased to **$29,485 thousand** as of June 30, 2025, from **$27,655 thousand** as of December 31, 2024, primarily due to increased costs of construction[53](index=53&type=chunk) - Accrued costs of construction, including capitalized interest, were **$13,758 thousand** for the six months ended June 30, 2025, down from **$17,815 thousand** in the prior year[54](index=54&type=chunk) - Right-of-use assets obtained in exchange for operating lease liabilities were **$20,238 thousand** for the six months ended June 30, 2025, a decrease from **$55,177 thousand** in the prior year[54](index=54&type=chunk) - Interest paid for the six months ended June 30, 2025, was **$3,742 thousand**, slightly down from **$3,851 thousand** in the prior year[54](index=54&type=chunk) - Cash and restricted cash at the end of the period was **$32,105 thousand**, a significant decrease from **$122,304 thousand** in the prior year[54](index=54&type=chunk) [Note 7. Leases](index=18&type=section&id=Note%207.%20Leases) This note details the Company's operating and finance leases, primarily ground leases at airports. Operating lease expenses significantly increased year-over-year due to new ground leases. The Company has entered into new ground lease agreements at Hillsboro Airport (HIO) and New York Stewart International Airport (SWF) in April 2025, expanding its portfolio - Total operating lease expense for the six months ended June 30, 2025, was **$6,865 thousand**, up **88%** from **$3,650 thousand** in the prior year[55](index=55&type=chunk) - Ground lease expenses increased by **86%** to **$6,472 thousand** for the six months ended June 30, 2025, driven by new ground leases at SLC, CMA, SWF, and HIO[55](index=55&type=chunk)[185](index=185&type=chunk) - The Company executed new ground lease agreements at Hillsboro Airport (HIO) and New York Stewart International Airport (SWF) in April 2025, covering approximately **13 and 16 acres**, respectively[59](index=59&type=chunk)[60](index=60&type=chunk) - The weighted average remaining lease term for all operating leases is **44.8 years** as of June 30, 2025[61](index=61&type=chunk) Future Minimum Lease Payments (in thousands) | Year Ending December 31, | Operating Leases (in thousands) | Finance Leases (in thousands) | | :----------------------- | :------------------------------ | :---------------------------- | | 2025 (remainder of year) | $3,231 | $12 | | 2026 | $7,143 | $17 | | 2027 | $8,504 | $2 | | 2028 | $9,701 | $0 | | 2029 | $10,249 | $0 | | Thereafter | $580,613 | $0 | | Total lease payments | $619,441 | $31 | - Future minimum lease payments from tenants (as lessor) total **$62,595 thousand**, with **$8,597 thousand** due in the remainder of 2025[64](index=64&type=chunk) [Note 8. Bonds payable, Loans payable, and Interest](index=21&type=section&id=Note%208.%20Bonds%20payable,%20Loans%20payable,%20and%20Interest) This note details the Company's Series 2021 Bonds, loans payable, and finance lease liabilities. The Series 2021 Bonds, totaling $166.3 million, are secured by leasehold interests and revenues of the Obligated Group. The Company's total bonds payable, net, remained stable, while loans payable and finance leases decreased. Capitalized interest significantly reduced reported interest expense - Series 2021 Bonds have a principal amount of **$166.3 million**, with interest rates ranging from **4.00% to 4.25%** and maturities from **2036 to 2054**[65](index=65&type=chunk)[67](index=67&type=chunk) - The fair value of Series 2021-1 Bonds was approximately **$138.8 million** as of June 30, 2025, down from **$143.8 million** as of December 31, 2024[69](index=69&type=chunk) - Total Bonds payable, net, was **$162,719 thousand** as of June 30, 2025, slightly up from **$162,621 thousand** as of December 31, 2024[70](index=70&type=chunk) - Total loans payable and finance leases decreased to **$6,664 thousand** as of June 30, 2025, from **$7,535 thousand** as of December 31, 2024[71](index=71&type=chunk) - Capitalized interest for the six months ended June 30, 2025, was **$3,568 thousand**, significantly reducing interest expense to **$271 thousand** from **$3,839 thousand** incurred[72](index=72&type=chunk) [Note 9. Warrants](index=22&type=section&id=Note%209.%20Warrants) This note describes the Company's outstanding Public, Private, and PIPE Warrants, which are classified as derivative liabilities and re-measured at fair value each reporting period. The Company recorded significant unrealized gains on warrants due to changes in fair value - As of June 30, 2025, **15,798,155 Warrants** remain outstanding, with an exercise price of **$11.50 per share** and an expiration date of January 25, 2027[76](index=76&type=chunk)[75](index=75&type=chunk) - The aggregate fair value of outstanding Warrants decreased to approximately **$26.8 million** as of June 30, 2025, from **$46.1 million** as of December 31, 2024[77](index=77&type=chunk) - The Company recorded unrealized gains of approximately **$21.8 million** for the three months ended June 30, 2025, and **$19.3 million** for the six months ended June 30, 2025, due to changes in fair value[77](index=77&type=chunk) - No Warrants were exercised during the three and six months ended June 30, 2025, compared to **253,703 Warrants** exercised in the prior year period[76](index=76&type=chunk) [Note 10. Equity](index=24&type=section&id=Note%2010.%20Equity) This note details the Company's common equity structure, including Class A and Class B Common Stock, and its At-the-Market (ATM) Facility. It also explains the non-controlling interests held by LLC Interests in Sky - As of June 30, 2025, there were **33,835,373 shares of Class A Common Stock** and **42,046,356 shares of Class B Common Stock** outstanding[79](index=79&type=chunk) - Class A and Class B Common Stock holders vote together, with Class A holders entitled to dividends and Class B holders only to stock dividends of Class B shares[80](index=80&type=chunk) - The Company has an At-the-Market (ATM) Facility allowing it to sell up to **$100 million** of Class A Common Stock through B. Riley Securities, Inc[81](index=81&type=chunk) - During the six months ended June 30, 2025, the Company sold **20,472 shares of Class A Common Stock** under the ATM Facility at a weighted-average price of **$13.70**[81](index=81&type=chunk) - Non-controlling interests represent the **55.4% ownership** of Sky Common Units by LLC Interests, which can be exchanged for Class A Common Shares[83](index=83&type=chunk) [Note 11. Equity Compensation](index=25&type=section&id=Note%2011.%20Equity%20Compensation) This note outlines the Company's equity compensation plans, including Restricted Stock Units (RSUs), Non-qualified Stock Options (NSOs), and Sky Incentive Units. The Company recognized increased stock compensation expense for RSUs and NSOs during the period - Stock compensation expense for RSU awards increased to **$2.1 million** for the six months ended June 30, 2025, from **$1.9 million** in the prior year[85](index=85&type=chunk) - As of June 30, 2025, **1,096,754 unvested RSUs** are outstanding, with **$10.3 million** in unrecognized compensation costs[85](index=85&type=chunk) - Stock compensation expense for NSO awards increased to **$0.4 million** for the six months ended June 30, 2025, from **$0.1 million** in the prior year[87](index=87&type=chunk) - Unrecognized compensation costs for unvested NSOs totaled **$7.6 million** as of June 30, 2025[87](index=87&type=chunk) - Equity-based compensation expense for Sky Incentive Units was **$75 thousand** for the six months ended June 30, 2025, with no unrecognized compensation expense remaining[88](index=88&type=chunk) [Note 12. Earnings (loss) per Share](index=25&type=section&id=Note%2012.%20Earnings%20(loss)%20per%20Share) This note details the calculation of basic and diluted earnings per share for Class A Common Stock. The Company reported positive basic and diluted EPS for the current six-month period, a significant improvement from a loss in the prior year, driven by higher net income and the dilutive effect of various securities - Basic EPS for Class A Common Stock was **$0.33** for the six months ended June 30, 2025, compared to **$(0.54)** in the prior year[91](index=91&type=chunk) - Diluted EPS for Class A Common Stock was **$0.07** for the six months ended June 30, 2025, compared to **$(0.54)** in the prior year[91](index=91&type=chunk) - Diluted weighted average shares outstanding increased to **77,768 thousand** for the six months ended June 30, 2025, from **24,504 thousand** in the prior year, primarily due to the effect of dilutive exchange of Class B Common Stock and Warrants[91](index=91&type=chunk) Earnings (Loss) Per Share Highlights (in thousands, except per share data) | Metric | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | Change (YoY) | | :------------------------------------------- | :--------------------------- | :--------------------------- | :------------- | | Basic net income (loss) attributable to SHG shareholders (in thousands) | $11,077 | $(13,178) | N/A | | Diluted net income (loss) attributable to SHG shareholders (in thousands) | $5,230 | $(13,178) | N/A | | Basic weighted average shares of Class A Common Stock outstanding (in thousands) | 33,747 | 24,504 | +37.3% | | Diluted weighted average shares outstanding (in thousands) | 77,768 | 24,504 | +217.4% | | Basic EPS | $0.33 | $(0.54) | N/A | | Diluted EPS | $0.07 | $(0.54) | N/A | [Note 13. Accumulated Other Comprehensive Income](index=27&type=section&id=Note%2013.%20Accumulated%20Other%20Comprehensive%20Income) This note provides a summary of the components of accumulated other comprehensive income, primarily consisting of unrealized gains on available-for-sale securities - Balance of accumulated other comprehensive income as of June 30, 2025, was **$70 thousand**, up from **$53 thousand** as of December 31, 2024[92](index=92&type=chunk) - Other comprehensive income before reclassifications was **$70 thousand** for the six months ended June 30, 2025, compared to **$462 thousand** in the prior year[92](index=92&type=chunk) [Note 14. Segment Information](index=27&type=section&id=Note%2014.%20Segment%20Information) The Company operates as a single consolidated reportable segment, deriving revenue from leasing aircraft hangars and ancillary services within the United States. The CEO acts as the Chief Operating Decision Maker (CODM), assessing performance based on net income (loss) and allocating resources on a consolidated basis - The Company has one consolidated reportable segment, focused on leasing home-basing aircraft hangars and ancillary services[93](index=93&type=chunk) - All revenue is derived entirely within the United States[93](index=93&type=chunk) - The CODM (CEO) uses net income (loss) to assess performance and allocate resources[94](index=94&type=chunk) [Note 15. Commitments and Contingencies](index=27&type=section&id=Note%2015.%20Commitments%20and%20Contingencies) This note outlines the Company's significant commitments, primarily related to ground lease covenants requiring construction of hangar facilities and minimum capital improvements at various airport sites. Failure to meet these timelines or spending requirements could lead to lease termination or financial penalties - Ground leases require construction of hangar facilities within specified periods and minimum capital expenditures at various sites (e.g., DVT Phase II, ORL, SLC, TTN, SWF)[95](index=95&type=chunk)[96](index=96&type=chunk)[98](index=98&type=chunk)[99](index=99&type=chunk)[100](index=100&type=chunk)[101](index=101&type=chunk) - For the SWF Lease, failure to expend **$60 million** in capital improvements within **36 months** could result in the difference being payable to SWF[101](index=101&type=chunk) - The Company has construction contracts for APA Phase I, DVT Phase I, ADS Phase I, and OPF Phase II projects, which can be terminated or suspended without penalty[102](index=102&type=chunk) - The Company is involved in various legal proceedings and claims in the ordinary course of business, not expected to materially affect financial condition[103](index=103&type=chunk) [Note 16. Related Party Transactions](index=29&type=section&id=Note%2016.%20Related%20Party%20Transactions) This note details several related party transactions, including a revolving line of credit with a company controlled by a former owner, aircraft use agreements with Echo Echo, LLC (related to the Founder and CEO), and construction services from a General Contractor where the Company's head of construction holds a financial interest - The Company has a **$3.0 million** revolving line of credit with a company controlled by a former owner of acquired subsidiaries, with **$1.1 million** loaned as of June 30, 2025[105](index=105&type=chunk)[106](index=106&type=chunk) - Agreements with Echo Echo, LLC (related to the Founder and CEO) for aircraft use resulted in **$325 thousand** in pursuit and marketing expenses for the six months ended June 30, 2025, up from **$87 thousand** in the prior year[107](index=107&type=chunk)[108](index=108&type=chunk)[109](index=109&type=chunk) - The Company incurred **$5.7 million** in construction costs from a General Contractor for the APA Phase I project, where the Company's head of construction and president of Ascend Aviation Services holds a financial interest[111](index=111&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=30&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the Company's financial condition, results of operations, and future outlook. It highlights the Company's business model in aviation infrastructure, recent operational and financial performance, key factors influencing future results, critical accounting policies, and liquidity and capital resources [Cautionary Note Regarding Forward-Looking Statements](index=30&type=section&id=Cautionary%20Note%20Regarding%20Forward-Looking%20Statements) This section warns readers that the report contains forward-looking statements based on current expectations, which are subject to risks and uncertainties that could cause actual results to differ materially. It emphasizes that these statements are not guarantees of future performance and the Company undertakes no obligation to update them - The report contains forward-looking statements identified by terms like "believes," "estimates," "anticipates," "expects," "intends," "plans," "may," "will," "potential," "projects," "predicts," "continue," or "should"[114](index=114&type=chunk) - Actual results may differ materially due to various factors, including macroeconomic conditions, limited operating history, construction costs, regulatory changes, and competitive factors[115](index=115&type=chunk)[118](index=118&type=chunk) - Forward-looking statements are not guarantees of future performance and the Company undertakes no obligation to update them, except as required by law[116](index=116&type=chunk) [Overview and Background](index=30&type=section&id=Overview%20and%20Background) Sky Harbour Group Corporation is an aviation infrastructure development company building a nationwide network of home-basing hangar campuses for business aircraft. The Company aims to address the growing demand for hangar space, especially for larger private jets, by developing scalable, real estate-centric solutions with long-term rental agreements - The Company develops, leases, and manages general aviation hangars across the U.S., targeting airfields with high hangar demand[117](index=117&type=chunk) - The U.S. business aviation fleet's physical footprint grew by **61%** between 2010 and 2023, with a **102% increase** in larger private jets, leading to a significant hangar supply shortage[119](index=119&type=chunk) - The Company's business model focuses on capturing this market opportunity by developing prototype hangar designs, achieving economies of scale, and securing long-term ground leases[122](index=122&type=chunk)[123](index=123&type=chunk)[124](index=124&type=chunk) - As of June 30, 2025, the Company has **17 ground leases** across various U.S. airports, with expiration years ranging from 2026 to 2097[126](index=126&type=chunk) Properties in Operation as of June 30, 2025 | Facility | Hangars | Rentable Square Footage | % of Total Rentable Square Footage | Occupancy at June 30, 2025 | | :--------------- | :------ | :---------------------- | :--------------------------------- | :------------------------- | | SGR | 7 | 66,080 | 7.5% | 100.0% | | BNA | 10 | 149,069 | 16.7% | 88.9% | | OPF Phase I | 12 | 160,092 | 17.9% | 100.0% | | DVT Phase I | 8 | 134,270 | 15.0% | 25.0% | | ADS Phase I | 6 | 120,836 | 13.5% | 26.5% | | SJC Renovation | 1 | 50,431 | 5.7% | 100.0% | | CMA | 4 | 121,931 | 13.7% | 77.6% | | BFI | 4 | 89,609 | 10.0% | 50.5% | | Total/Weighted Average | 52 | 892,318 | 100.0% | 68.9% | Properties in Development as of June 30, 2025 | Facility | Status | Projected Construction Start | Projected Completion Date | Estimated Total Project Cost ($mm) | Hangars | Rentable Square Footage | | :--------------- | :------------- | :--------------------------- | :------------------------ | :--------------------------------- | :------ | :---------------------- | | ADS Phase II | In Development | Q2 2025 | Q3 2026 | 24.6 - 28.5 | 4 | 108,320 | | APA Phase I | In Construction | Q4 2022 | Q3 2025 | 48.4 - 48.6 | 9 | 132,000 | | APA Phase II | Predevelopment | Q3 2026 | Q4 2027 | 30.4 - 33.6 | 3 | 60,945 | | BDL Phase I | In Development | Q3 2025 | Q4 2026 | 40.0 - 42.1 | 3 | 107,360 | | DVT Phase II | Predevelopment | Q2 2026 | Q2 2027 | 34.6 - 38.6 | 6 | 132,732 | | HIO Phase I | In Development | Q3 2026 | Q4 2027 | 39.9 - 44.1 | 3 | 128,640 | | HIO Phase II | In Development | Q4 2027 | Q4 2029 | 20.0 - 22.1 | 2 | 64,480 | | IAD Phase I | In Development | Q2 2026 | Q3 2027 | 55.0 - 60.8 | 4 | 171,520 | | IAD Phase II | Predevelopment | Q3 2031 | Q4 2032 | 44.7 - 49.4 | 4 | 171,520 | | OPF Phase II | In Construction | Q1 2025 | Q2 2026 | 39.3 - 39.6 | 3 | 111,720 | | ORL Phase I | In Development | Q1 2026 | Q2 2027 | 39.5 - 43.6 | 3 | 133,640 | | ORL Phase II | Predevelopment | Q4 2034 | Q1 2036 | 35.2 - 39.0 | 3 | 128,640 | | POU Phase I | In Development | Q2 2026 | Q3 2027 | 38.8 - 42.8 | 2 | 85,760 | | POU Phase II | Predevelopment | Q1 2027 | Q2 2028 | 18.3 - 20.3 | 1 | 42,880 | | PWK Phase I | In Development | Q2 2026 | Q3 2027 | 53.6 - 59.2 | 4 | 171,520 | | PWK Phase II | Predevelopment | TBD | TBD | TBD | TBD | TBD | | SJC Phase II | In Development | Q2 2027 | Q1 2028 | 11.8 - 13.0 | 1 | 28,000 | | SLC | In Development | Q1 2026 | Q1 2027 | 59.2 - 65.5 | 4 | 171,520 | | SWF | In Development | TBD | TBD | TBD | TBD | TBD | | TTN | In Development | Q2 2026 | Q3 2027 | 40.1 - 44.3 | 3 | 128,640 | | Total | | | | 673.4 - 735.1 | 62 | 2,079,837 | [Recent Developments](index=34&type=section&id=Recent%20Developments) In April 2025, the Company expanded its portfolio by entering into new long-term ground lease agreements at Hillsboro Airport (HIO) and New York Stewart International Airport (SWF), covering approximately 13 and 16 acres, respectively, with initial terms of 35 and 30 years, plus extension options - In April 2025, the Company entered into a ground lease agreement (HIO Lease) at Hillsboro Airport (HIO) for approximately **13 acres**, with an initial term of **35 years** and a **10-year extension option**[133](index=133&type=chunk) - Also in April 2025, the Company entered into a ground lease agreement (SWF Lease) at New York Stewart International Airport (SWF) for approximately **16 acres**, with an initial term of **30 years** and three options for an additional **15 years**[134](index=134&type=chunk)[135](index=135&type=chunk) [Factors That May Influence Future Results of Operations](index=36&type=section&id=Factors%20That%20May%20Influence%20Future%20Results%20of%20Operations) Future results are influenced by airfield and tenant portfolio growth, construction material and labor costs, and market interest rates. The Company's ability to attract tenants, secure new ground leases, mitigate rising construction costs (e.g., through vertical integration and GMP contracts), and manage borrowing costs are critical - Future success depends on attracting and retaining tenants, which is influenced by tenant preferences, economic conditions, fuel prices, and competition[136](index=136&type=chunk) - Expansion through new ground leases is integral but faces challenges like negotiating favorable terms and competition[137](index=137&type=chunk) - Construction costs are influenced by material prices (e.g., steel tariffs) and labor; the Company uses GMP contracts and vertical integration (acquired a metal building manufacturer) to mitigate these[138](index=138&type=chunk)[139](index=139&type=chunk) - A significant design defect in prototype hangar buildings required retrofitting for DVT Phase I, APA Phase I, and ADS Phase I, incurring **$26-$28 million** in additional costs and **3-5 months** delay[139](index=139&type=chunk) - The Company plans to incorporate a larger hangar prototype for future projects, expecting cost savings through economies of scale, but construction cost estimates are subject to variability[141](index=141&type=chunk) - Rising interest rates and credit spreads could increase future borrowing costs, impacting economic performance. The Company plans to issue additional debt and may use hedging strategies[143](index=143&type=chunk) - The Company's **20-airport site business plan** is estimated to cost **$1.2 billion**, with **65-75%** funded by private activity bonds and the balance by equity[146](index=146&type=chunk) [Key Business Metrics](index=39&type=section&id=Key%20Business%20Metrics) The Company monitors key metrics including Revenue (rental and fuel), Operating Expenses (ground lease, campus operating, compensation), Operating Income (Loss), Net Income (Loss), and Adjusted EBITDA. Adjusted EBITDA is a non-GAAP measure used to evaluate operating performance and debt service ability, excluding non-cash items - **Revenue:** Primarily from rents and fees from lease and service agreements; growth depends on attracting and retaining tenants[148](index=148&type=chunk) - **Operating Expenses:** Significant expenses include ground lease payments, which are expensed even during development, and are expected to increase with new leases[149](index=149&type=chunk) - **Adjusted EBITDA:** A non-GAAP measure defined as net income before depreciation, interest expense/income, non-cash stock-based compensation, non-cash gains/losses on warrants, non-cash operating lease expense/income, income taxes, and other non-cash expenses[152](index=152&type=chunk) - Adjusted EBITDA is used to evaluate operating performance, analyze debt service ability, and facilitate company-to-company comparisons[152](index=152&type=chunk) [Critical Accounting Policies and Estimates](index=41&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section reiterates the critical accounting policies and estimates, including the use of estimates, cost of construction, leases, and revenue recognition, which require significant management judgment and can materially affect reported financial amounts - **Use of Estimates:** Requires management to make assumptions affecting reported assets, liabilities, and expenses, including impairment analyses, useful lives, fair value of financial instruments (warrants), ROU assets, and operating lease liabilities[156](index=156&type=chunk) - **Cost of Construction:** Costs are capitalized once a capital project is probable, including direct construction costs, professional fees, and allocated internal salaries and interest costs[157](index=157&type=chunk) - **Leases:** Accounts for leases under ASC Topic 842, recognizing ROU assets and lease liabilities for operating leases over 12 months. The Company expenses ground lease costs rather than capitalizing implicit interest[158](index=158&type=chunk) - **Revenue Recognition:** Rental revenue from hangar facilities is recognized on a straight-line basis for fixed payments and in the same period as expenses are incurred for variable payments (tenant reimbursements)[160](index=160&type=chunk) [Results of Operations](index=43&type=section&id=Results%20of%20Operations) Analyzes the company's financial performance over specific periods, detailing revenue, expenses, and profitability drivers [Three Months Ended June 30, 2025 Compared to the Three Months Ended June 30, 2024](index=43&type=section&id=Three%20Months%20Ended%20June%2030,%202025%20Compared%20to%20the%20Three%20Months%20Ended%20June%2030,%202024) The Company experienced significant revenue growth and a shift to net income for the three months ended June 30, 2025, compared to the prior year. This was driven by increased occupancy at existing campuses and the acquisition of CMA, alongside a substantial unrealized gain on warrants. Operating expenses also rose due to expansion and new ground leases - Total revenue increased by **$2.97 million (82%)** to **$6,588 thousand**[165](index=165&type=chunk) - Rental revenue increased by **$2.05 million (65%)**[166](index=166&type=chunk) - Fuel revenue increased by **$0.92 million (207%)**[167](index=167&type=chunk) - Net income was **$14,356 thousand**, a significant increase from **$4,163 thousand** in the prior year[165](index=165&type=chunk) - Operating loss increased by **$2.57 million (52%)** to **$(7,528) thousand**[165](index=165&type=chunk) - Total expenses increased by **$5.54 million (65%)** to **$14,116 thousand**, driven by campus operating expenses (**+122%**), fuel expenses (**+1026%**), and ground lease expenses (**+59%**)[165](index=165&type=chunk)[168](index=168&type=chunk)[169](index=169&type=chunk)[170](index=170&type=chunk) - Unrealized gain on warrants was **$(21,801) thousand**, a **$13.58 million** difference compared to **$(8,219) thousand** in the prior year, significantly impacting net income[165](index=165&type=chunk)[176](index=176&type=chunk) Results of Operations (Three Months Ended June 30, 2025 vs. 2024, in thousands) | Metric (in thousands) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | Change ($) | Change (%) | | :-------------------------------- | :--------------------------- | :--------------------------- | :--------- | :--------- | | Rental revenue | $5,225 | $3,174 | $2,051 | 65% | | Fuel revenue | $1,363 | $444 | $919 | 207% | | Total revenue | $6,588 | $3,618 | $2,970 | 82% | | Campus operating expenses | $2,226 | $1,004 | $1,222 | 122% | | Fuel expenses | $923 | $82 | $841 | 1026% | | Ground lease expenses | $3,568 | $2,253 | $1,315 | 59% | | Depreciation and amortization | $1,479 | $642 | $837 | 130% | | Pursuit and marketing expenses | $585 | $373 | $212 | 57% | | Employee compensation and benefits | $4,294 | $3,415 | $879 | 26% | | General and administrative expenses | $1,041 | $807 | $234 | 29% | | Total expenses | $14,116 | $8,576 | $5,540 | 65% | | Operating loss | $(7,528) | $(4,958) | $(2,570) | -52% | | Unrealized gain on warrants | $(21,801) | $(8,219) | $(13,582) | -165% | | Net income (loss) | $14,356 | $4,163 | $10,193 | 245% | [Six Months Ended June 30, 2025 Compared to the Six Months Ended June 30, 2024](index=46&type=section&id=Six%20Months%20Ended%20June%2030,%202025%20Compared%20to%20the%20Six%20Months%20Ended%20June%2030,%202024) For the six months ended June 30, 2025, the Company saw substantial revenue growth and a significant turnaround from a net loss to net income compared to the prior year. This improvement was primarily driven by increased operational activity, the acquisition of CMA, and a large unrealized gain on warrants, despite rising operating expenses due to expansion - Total revenue increased by **$6.16 million (102%)** to **$12,180 thousand**[179](index=179&type=chunk) - Rental revenue increased by **$4.37 million (82%)**[180](index=180&type=chunk) - Fuel revenue increased by **$1.78 million (251%)**[181](index=181&type=chunk) - Net income was **$5,230 thousand**, a significant improvement from a net loss of **$(17,036) thousand** in the prior year[179](index=179&type=chunk) - Operating loss increased by **$4.17 million (41%)** to **$(14,352) thousand**[179](index=179&type=chunk) - Total expenses increased by **$10.33 million (64%)** to **$26,532 thousand**, driven by campus operating expenses (**+130%**), fuel expenses (**+969%**), and ground lease expenses (**+86%**)[179](index=179&type=chunk)[182](index=182&type=chunk)[183](index=183&type=chunk)[184](index=184&type=chunk) - Unrealized gain on warrants was **$(19,274) thousand**, a **$27.24 million** difference compared to an unrealized loss of **$7,969 thousand** in the prior year, significantly impacting net income[179](index=179&type=chunk)[190](index=190&type=chunk) Results of Operations (Six Months Ended June 30, 2025 vs. 2024, in thousands) | Metric (in thousands) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | Change ($) | Change (%) | | :-------------------------------- | :--------------------------- | :--------------------------- | :--------- | :--------- | | Rental revenue | $9,685 | $5,312 | $4,373 | 82% | | Fuel revenue | $2,495 | $710 | $1,785 | 251% | | Total revenue | $12,180 | $6,022 | $6,158 | 102% | | Campus operating expenses | $4,109 | $1,783 | $2,326 | 130% | | Fuel expenses | $1,657 | $155 | $1,502 | 969% | | Ground lease expenses | $6,472 | $3,484 | $2,988 | 86% | | Depreciation and amortization | $2,578 | $1,271 | $1,307 | 103% | | Pursuit and marketing expenses | $1,165 | $727 | $438 | 58% | | Employee compensation and benefits | $8,533 | $7,006 | $1,527 | 22% | | General and administrative expenses | $2,018 | $1,778 | $240 | 13% | | Total expenses | $26,532 | $16,204 | $10,328 | 64% | | Operating loss | $(14,352) | $(10,182) | $(4,170) | -41% | | Unrealized loss on warrants | $(19,274) | $7,969 | $(27,243) | -342% | | Net income (loss) | $5,230 | $(17,036) | $22,266 | N/A | [Non-GAAP Financial Measures](index=48&type=section&id=Non-GAAP%20Financial%20Measures) This section defines Adjusted EBITDA as a non-GAAP financial measure used by management to evaluate operating performance and facilitate comparisons. It excludes various non-cash items and is presented as a supplemental measure, not a substitute for GAAP - Adjusted EBITDA is a non-GAAP financial measure used to evaluate operating and financial performance[191](index=191&type=chunk) - It is defined as net income before depreciation, interest expense/income, non-cash stock-based compensation, non-cash gains/losses on warrants, non-cash operating lease expense/income, income taxes, and other non-cash expenses[191](index=191&type=chunk) - Adjusted EBITDA for the six months ended June 30, 2025, was **$(6,330) thousand**, compared to **$(4,847) thousand** in the prior year[193](index=193&type=chunk) Adjusted EBITDA Reconciliation (in thousands) | Metric (in thousands) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :------------------------------------ | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Net income (loss) | $14,356 | $4,163 | $5,230 | $(17,037) | | Depreciation and amortization | $1,479 | $642 | $2,578 | $1,271 | | Interest expense | $133 | $187 | $271 | $381 | | Other income | $(216) | $(1,089) | $(579) | $(1,496) | | Changes in fair value of warrant liabilities | $(21,801) | $(8,219) | $(19,274) | $7,969 | | Equity-based compensation | $1,323 | $1,076 | $2,561 | $2,108 | | Non-cash operating lease expense | $1,867 | $1,141 | $3,348 | $1,940 | | Non-cash operating lease income | $(157) | $36 | $(465) | $17 | | **Adjusted EBITDA** | **$(3,016)** | **$(2,063)** | **$(6,330)** | **$(4,847)** | [Liquidity and Capital Resources](index=49&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses the Company's liquidity, primary cash sources (equity/debt issuance, rental payments), and long-term requirements (lease payments, construction costs, debt repayment). It details recent private placements, the At-the-Market (ATM) Facility, Private Activity Bonds, and cash flow activities, highlighting a significant decrease in cash and restricted cash [Overview](index=49&type=section&id=Overview) The Company's liquidity is supported by potential equity and debt issuances, and rental payments, to meet ongoing commitments like debt repayment, construction funding, and operating expenses. While the Company believes it has access to capital, it acknowledges risks related to market conditions and favorable terms - Primary sources of cash include potential equity and debt securities issuance and rental payments from tenants[194](index=194&type=chunk) - Long-term liquidity requirements include ground lease payments, principal and interest on borrowings, construction costs, and operations[194](index=194&type=chunk) - Total cash, restricted cash, investments, and restricted investments decreased to **$74,561 thousand** as of June 30, 2025, from **$127,162 thousand** as of December 31, 2024[197](index=197&type=chunk) Cash, Restricted Cash, Investments, and Restricted Investments (in thousands) | Metric (in thousands) | June 30, 2025 | December 31, 2024 | Change | | :---------------------------------------------------- | :------------ | :---------------- | :----- | | Cash and cash equivalents | $8,610 | $42,442 | -$33,832 | | Restricted cash | $23,495 | $51,917 | -$28,422 | | Investments | $30,999 | $18,987 | +$12,012 | | Restricted investments | $11,457 | $13,816 | -$2,359 | | Total cash, restricted cash, investments, and restricted investments | $74,561 | $127,162 | -$52,501 | [2024 Private Placement and Securities Purchase Agreement](index=49&type=section&id=2024%20Private%20Placement%20and%20Securities%20Purchase%20Agreement) In September and October 2024, the Company completed a private placement, issuing 7,911,580 shares of Class A Common Stock for an aggregate purchase price of approximately $75.2 million - On September 16, 2024, the Company entered into the 2024 Purchase Agreement[198](index=198&type=chunk) - Issued **7,911,580 shares of Class A Common Stock** for an aggregate purchase price of approximately **$75.2 million** through two closings in October and December 2024[198](index=198&type=chunk) [2023 Private Placement and Securities Purchase Agreement](index=49&type=section&id=2023%20Private%20Placement%20and%20Securities%20Purchase%20Agreement) In November 2023, the Company completed a private placement, issuing 8,893,846 shares of Class A Common Stock and warrants to purchase 1,541,600 shares, raising approximately $57.8 million - On November 1, 2023, the Company entered into the 2023 Purchase Agreement[199](index=199&type=chunk) - Issued **8,893,846 shares of Class A Common Stock** and warrants to purchase **1,541,600 shares of Class A Common Stock**[199](index=199&type=chunk)[200](index=200&type=chunk) - The aggregate PIPE financing totaled approximately **$57.8 million**[200](index=200&type=chunk) [At-the-Market Facility](index=51&type=section&id=At-the-Market%20Facility) The Company has an At-the-Market (ATM) Facility allowing it to sell up to $100 million of Class A Common Stock. During the six months ended June 30, 2025, it sold a limited number of shares, retaining significant remaining capacity - The ATM Agreement, established March 27, 2024, allows the Company to sell up to **$100 million** of Class A Common Stock[201](index=201&type=chunk) - During the six months ended June 30, 2025, **20,472 shares of Class A Common Stock** were sold at a weighted-average price of **$13.70**[201](index=201&type=chunk) - Approximately **$98.6 million** in remaining capacity under the ATM Facility[201](index=201&type=chunk) [Private Activity Bonds](index=51&type=section&id=Private%20Activity%20Bonds) In September 2021, SHC issued $166.3 million in Senior Special Facility Revenue Bonds (PABs) to finance or refinance construction of aviation facilities at five initial airport locations. These bonds are collateralized by the property and revenues of SHC subsidiaries - SHC issued **$166.3 million** of Senior Special Facility Revenue Bonds (PABs) on September 14, 2021[203](index=203&type=chunk) - PABs are comprised of three maturities with interest rates from **4.00% to 4.25%**, due between 2036 and 2054[203](index=203&type=chunk) - Proceeds are used to finance construction at SGR, OPF, BNA, APA, and DVT sites, fund debt service, and establish a Debt Service Reserve Fund[203](index=203&type=chunk) [Debt Covenants](index=51&type=section&id=Debt%20Covenants) The PABs include financial and non-financial covenants, such as a debt service coverage ratio of at least 1.25. The Company was in compliance with all debt covenants as of June 30, 2025 - PABs contain financial and non-financial covenants, including a debt service coverage ratio of at least **1.25**[204](index=204&type=chunk)[205](index=205&type=chunk) - The Company was in compliance with all debt covenants as of June 30, 2025[205](index=205&type=chunk) [Lease Commitments](index=52&type=section&id=Lease%20Commitments) The Company has significant future minimum lease payments under operating and finance leases, totaling $619.4 million for operating leases and $31 thousand for finance leases as of June 30, 2025, with the majority of operating lease payments due after 2029 - Total future minimum operating lease payments are **$619,441 thousand**[206](index=206&type=chunk) - Total future minimum finance lease payments are **$31 thousand**[206](index=206&type=chunk) - The majority of operating lease payments (**$580,613 thousand**) are due thereafter (beyond 2029)[206](index=206&type=chunk) Future Minimum Lease Payments (in thousands) | Year Ending December 31, | Operating Leases (in thousands) | Finance Leases (in thousands) | | :----------------------- | :------------------------------ | :---------------------------- | | 2025 (remainder of year) | $3,231 | $12 | | 2026 | $7,143 | $17 | | 2027 | $8,504 | $2 | | 2028 | $9,701 | $0 | | 2029 | $10,249 | $0 | | Thereafter | $580,613 | $0 | | Total lease payments | $619,441 | $31 | [Off-Balance Sheet Arrangements](index=52&type=section&id=Off-Balance%20Sheet%20Arrangements) The Company does not maintain any off-balance sheet arrangements - The Company does not maintain any off-balance sheet arrangements[207](index=207&type=chunk) [Cash Flows](index=53&type=section&id=Cash%20Flows) The Company experienced a significant decrease in cash and restricted cash, primarily due to increased cash used in investing activities (payments for construction, purchases of investments) and a decrease in proceeds from held-to-maturity investments, alongside increased cash used in operating and financing activities - Net cash used in operating activities increased to **$(5,994) thousand** for the six months ended June 30, 2025, from **$(5,472) thousand** in the prior year[209](index=209&type=chunk)[211](index=211&type=chunk) - Net cash used in investing activities was **$(54,803) thousand**, a decrease of **$109.3 million** compared to cash provided of **$54,535 thousand** in the prior year[209](index=209&type=chunk)[213](index=213&type=chunk) - Net cash used in financing activities was **$(1,457) thousand**, compared to cash provided of **$975 thousand** in the prior year, primarily due to a decrease in warrant exercise proceeds[209](index=209&type=chunk)[215](index=215&type=chunk) - Cash and restricted cash at the end of the period decreased to **$32,105 thousand** from **$122,304 thousand**[209](index=209&type=chunk) Cash Flow Summary (in thousands) | Metric (in thousands) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | Change ($) | | :------------------------------------ | :--------------------------- | :--------------------------- | :--------- | | Cash and restricted cash at beginning of period | $94,359 | $72,266 | +$22,093 | | Net cash used in operating activities | $(5,994) | $(5,472) | -$522 | | Net cash (used in) provided by investing activities | $(54,803) | $54,535 | -$109,338 | | Net cash (used in) provided by financing activities | $(1,457) | $975 | -$2,432 | | Cash and restricted cash at end of period | $32,105 | $122,304 | -$90,199 | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=54&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, Sky Harbour Group Corporation is not required to provide specific quantitative and qualitative disclosures about market risk - The Company is a smaller reporting company and is not required to provide information under this item[216](index=216&type=chunk) [Item 4. Controls and Procedures](index=54&type=section&id=Item%204.%20Controls%20and%20Procedures) The Chief Executive Officer and Chief Financial Officer evaluated the effectiveness of the Company's disclosure controls and procedures as of June 30, 2025, concluding they are effective. There have been no material changes in internal control over financial reporting during the period - CEO and CFO concluded that disclosure controls and procedures were effective as of June 30, 2025[218](index=218&type=chunk) - No material changes in internal control over financial reporting occurred during the three months ended June 30, 2025[219](index=219&type=chunk) [PART II. OTHER INFORMATION](index=55&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section provides additional information not covered in the financial statements, including legal proceedings, risk factors, and exhibits [Item 1. Legal Proceedings](index=55&type=section&id=Item%201.%20Legal%20Proceedings) The Company is not currently a party to any material legal proceedings - The Company is not currently a party to any material legal proceedings[222](index=222&type=chunk) [Item 1A. Risk Factors](index=55&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the Company's risk factors from those disclosed in its Annual Report on Form 10-K for the fiscal year ended December 31, 2024 - No material changes in risk factors from the Annual Report on Form 10-K for the year ended December 31, 2024[223](index=223&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=55&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During the three months ended June 30, 2025, there were no unregistered sales of the Company's securities that were not previously reported in a Current Report on Form 8-K - No unregistered sales of equity securities occurred during the three months ended June 30, 2025, that were not previously reported[224](index=224&type=chunk) [Item 3. Defaults Upon Senior Securities](index=55&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This item is not applicable to the Company - Not applicable[225](index=225&type=chunk) [Item 4. Mine Safety Disclosures](index=55&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the Company - Not applicable[226](index=226&type=chunk) [Item 5. Other Information](index=55&type=section&id=Item%205.%20Other%20Information) During the three months ended June 30, 2025, no director or officer adopted or terminated a "Rule 10b5-1 trading arrangement" or a "non-Rule 10b5-1 trading arrangement" - No director or officer adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the three months ended June 30, 2025[227](index=227&type=chunk) [Item 6. Exhibits](index=56&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed or furnished with the report, including certifications, XBRL documents, and previously incorporated by reference documents - Includes certifications of CEO and CFO (Exhibits 31.1, 31.2, 32.1, 32.2)[229](index=229&type=chunk) - Includes Inline XBRL Instance Document and Taxonomy Extension Documents[229](index=229&type=chunk) [Signatures](index=57&type=section&id=Signatures) The report is duly signed on behalf of Sky Harbour Group Corporation by its Chief Executive Officer, Chief Financial Officer, and Chief Accounting Officer as of August 12, 2025 - Signed by Tal Keinan (CEO), Francisco Gonzalez (CFO), and Michael W. Schmitt (CAO) on August 12, 2025[232](index=232&type=chunk)

Core Viewpoint - Sky Harbour Group Corporation (SKYH) shows potential for significant upside, with a mean price target of $17.92 indicating a 73% increase from its current price of $10.36 [1] Price Targets and Analyst Estimates - The mean estimate consists of six short-term price targets with a standard deviation of $4.8, suggesting variability in analyst predictions [2] - The lowest estimate of $14.00 indicates a 35.1% increase, while the highest estimate of $25.00 suggests a potential surge of 141.3% [2] - A low standard deviation indicates strong agreement among analysts regarding the stock's price movement [9] Earnings Estimates and Analyst Sentiment - Analysts have shown increasing optimism about SKYH's earnings prospects, with a positive trend in earnings estimate revisions [11] - Over the last 30 days, one estimate has increased, leading to a 9.8% rise in the Zacks Consensus Estimate [12] - SKYH holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimates [13] Caution on Price Targets - Solely relying on price targets for investment decisions may not be wise, as analysts' ability to set unbiased targets has been questioned [3][7] - Price targets should be treated with skepticism, as they can mislead investors [10]

Core Viewpoint - Sky Harbour Group Corporation (SKYH) is anticipated to report a year-over-year decline in earnings despite an increase in revenues for the quarter ended June 2025, with the actual results being a significant factor influencing its near-term stock price [1][2]. Financial Expectations - The consensus estimate indicates a quarterly loss of $0.12 per share, reflecting a year-over-year change of -300% [3]. - Expected revenues are projected to be $6.63 million, representing an 83.2% increase from the same quarter last year [3]. Estimate Revisions - The consensus EPS estimate has been revised 13.33% higher in the last 30 days, indicating a collective reassessment by analysts [4]. - The Most Accurate Estimate for Sky Harbour Group is higher than the Zacks Consensus Estimate, resulting in an Earnings ESP of +35.13% [12]. Earnings Surprise Prediction - A positive Earnings ESP reading suggests a likely earnings beat, especially when combined with a Zacks Rank of 1 (Strong Buy) [10]. - Sky Harbour Group's current Zacks Rank is 1, indicating a strong likelihood of surpassing the consensus EPS estimate [12]. Historical Performance - In the last reported quarter, Sky Harbour Group was expected to post a loss of $0.25 per share but actually reported a loss of -$0.11, achieving a surprise of +56.00% [13]. - Over the past four quarters, the company has exceeded consensus EPS estimates two times [14]. Industry Context - Another player in the Aerospace - Defense Equipment industry, Mercury Systems (MRCY), is expected to report earnings of $0.21 per share, reflecting a year-over-year decline of -8.7% [18]. - Mercury Systems' revenues are projected to be $241.71 million, down 2.8% from the previous year, with an Earnings ESP of +8.05% [19].

Core Viewpoint - Sky Harbour Group Corporation (SKYH) shows potential for significant upside, with a mean price target of $17.92 indicating a 76.9% increase from its current price of $10.13 [1] Price Targets and Analyst Estimates - The mean estimate consists of six short-term price targets with a standard deviation of $4.8, suggesting variability among analysts [2] - The lowest estimate of $14.00 indicates a 38.2% increase, while the highest estimate of $25.00 suggests a potential surge of 146.8% [2] - Analysts' price targets can often mislead investors, as empirical research indicates they rarely reflect actual stock price movements [7][10] Earnings Estimates and Analyst Agreement - There is strong agreement among analysts regarding SKYH's ability to report better earnings, which supports the potential for stock upside [4][11] - Over the last 30 days, the Zacks Consensus Estimate for the current year has increased by 9.8%, with one estimate moving higher and no negative revisions [12] - SKYH holds a Zacks Rank 1 (Strong Buy), placing it in the top 5% of over 4,000 ranked stocks based on earnings estimates [13] Conclusion on Price Movement - While the consensus price target may not be a reliable indicator of the extent of potential gains, it does provide a useful guide for the direction of price movement [14]

Group 1 - The individual holds a PhD in Machine Learning with a focus on Economics and Finance, indicating a strong academic background relevant to financial analysis [1] - Professional experience includes working at Deloitte Financial Advisory, specializing in Data Science and Machine Learning applications for clients in banking, insurance, and finance, highlighting expertise in applying advanced technologies in financial sectors [1] - Current teaching roles include Asset Pricing and Introduction to Corporate Finance at ESADE Business School, suggesting involvement in educating future finance professionals [1] Group 2 - Research interests focus on Generative AI in sustainable finance, indicating a trend towards integrating advanced AI technologies in financial practices [1] - Proficiency in programming languages such as Python, R, and SQL, which are essential for data analysis and financial modeling in the industry [1] - The individual has publications in Artificial Intelligence and finance journals, reflecting a commitment to contributing to academic and professional discourse in these fields [1]

Summary of Sky Harbour Group (SKYH) Conference Call - June 05, 2025 Company Overview - **Company**: Sky Harbour Group (SKYH) - **Industry**: Aviation Real Estate - **Business Model**: Focuses on hangar construction at airports, leasing to general aviation business jet owners [3][4] Key Points Business Operations - **Hangar Construction**: Acquires land through long-term ground leases (typically 50 years) at U.S. airfields, designs, constructs, and operates hangars [5][6] - **Tenant Profile**: Primarily high net worth individuals and corporate aviation fleets [6] - **Revenue Streams**: Includes hangar leasing and aviation services such as fueling [6][24] Market Opportunity - **Demand Drivers**: Increasing size and longevity of business aviation fleet leading to higher demand for hangar space [9][10] - **Supply Constraints**: Insufficient hangar supply due to local municipalities' reluctance to invest in hangar construction, typically relying on FBOs [10][12] Financial Metrics - **Target Returns**: Aims for low to mid-teen NOI yields, with current unit economics showing an average development cost of $300 per square foot and rental income of $45 per square foot [16][17] - **Debt Structure**: Utilizes tax-exempt municipal bonds for financing, with a current average yield of 4.18% and plans to issue new debt at 5.5% to 5.75% [19][20][21] Growth Strategy - **Expansion Plans**: Currently operates 18 ground leases, aiming for 23 by year-end, with ongoing efforts to secure additional leases [15][26] - **Vertical Integration**: Acquired a hangar manufacturing company to reduce costs and improve margins, targeting a 5% savings on hard costs [33][34] Competitive Landscape - **FBOs**: While FBOs have considered entering the home basing sector, they remain focused on fuel sales and have not significantly shifted their business model [39][40] - **Barriers to Entry**: Challenges in airport land acquisition and the need for established relationships with airport authorities limit new entrants [41][42] Recent Developments - **Lease-Up Strategy**: Ongoing leasing efforts at newly constructed campuses, balancing speed of lease-up with achieving target rental rates [36][38] - **Capital Position**: Currently holds $97.5 million in cash, earmarked for ongoing construction and future debt issuance [25] Shareholder Relations - **Boston Omaha Corp**: Noted as a significant shareholder, currently trimming their position to raise capital for other investments, which may impact stock performance [44][46] Additional Insights - **Operational Efficiency**: Plans to bring more construction processes in-house to enhance control over costs and timelines [32][34] - **Future Revenue Potential**: Ground leases are viewed as critical assets, representing future revenue streams post-construction [23][24] This summary encapsulates the key aspects of Sky Harbour Group's business model, market dynamics, financial metrics, growth strategies, competitive landscape, and recent developments as discussed in the conference call.

Core Insights - Sky Harbour Group Corp. (NYSE: SKYH) demonstrated strong momentum in Q1 2025, driven by the expansion of its aviation infrastructure and increased operational capacity [1][7] - The company initiated operations at its Phoenix Deer Valley campus and is preparing for openings at Dallas Addison and Denver Centennial, scheduled for Q2 2025 [1] - Sky Harbour added a new facility at Seattle's Boeing Field, with approximately 90,000 sq ft of rentable space, and signed new ground leases at Hillsboro and Stewart International [1] Financial Performance - Sky Harbour reported total revenue of $5.6 million in Q1 2025, representing a 133% increase from $2.4 million in Q1 2024 and a 20% sequential increase [7] - As of the end of Q1 2025, the company's total assets amounted to $553.7 million, with liquidity remaining strong at $97.5 million [7] Operational Expansion - The company's portfolio includes eight operational campuses, one under construction, and ten in pre-development, positioning it for significant long-term growth [1][7]

2024 Q4 Earnings Webcast March 27th, 2025 DI SCLAI M ER This Presentation includes "forward-looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as "estimate," "plan," "goal," "project," "forecast," "intend," "will," "expect," "anticipate," "believe," "seek," "target" or other similar expressions that predict or indicate future events or trends or tha ...

Financial Performance & Construction - Sky Harbour Group Corp is experiencing accelerating construction and increasing revenues[9] - Cost of construction and constructed assets are increasing over time, as shown in the provided chart[10, 25] - Quarterly revenues are also increasing over time, as shown in the provided chart[12, 27] - Sky Harbour Capital - PABS Obligated Group anticipates a step up in 2025 with three new campus openings[24] Expenses & Cash Flow - Operating expenses are increasing over time, as shown in the provided chart[18, 32] - Net cash flow used in operating activities is also increasing over time, as shown in the provided chart[16] - U.S Treasuries and cash are approximately $97.5 million, comprised of $83.65 million in cash and $13.813 million in treasuries[48] Strategic Initiatives & Development - Sky Harbour is accelerating its site acquisition pace to drive long-term value[33] - A new ground lease was signed in Hillsboro (HIO) in Portland, OR, with a potential stabilized revenue of $7.0 million[39, 43] - Sky Harbour is scaling up construction through vertical integration to improve speed, cost, scale, build quality, versatility, and unit economics[44, 45] - Sky Harbour is gearing up for order-of-magnitude scale-up in site acquisition, development, leasing, and operations[55, 57, 58]