Bridger Aerospace Group (NASDAQ:BAER) is expanding its aerial firefighting fleet and pursuing longer-term government contracts as wildfire activity extends further into the year, Chief Executive Officer Sam Davis said during a discussion hosted by Canaccord Genuity Senior Aerospace and Defense Technology Analyst Austin Moeller.
Headquartered in Bozeman, Montana, Bridger provides wildfire suppression and surveillance services. Davis said the company operates the largest privately owned fleet of Super Scooper aircraft, which are purpose-built water-scooping planes used to support ground firefighting crews. The company also operates sensor-equipped aircraft that provide real-time imagery, perimeter mapping and other situational-awareness data.
Super Scooper Fleet and Contract Demand
The company recently acquired two additional Super Scoopers in Spain, bringing its total fleet to eight aircraft. Those two aircraft are currently operating in Portugal under a dry-lease arrangement with Avincis that runs from mid-July through mid-October, Davis said.
While the European contract provides revenue, Davis said Bridger increasingly sees the U.S. as the better market for the aircraft because of demand and economics. He said requests for Super Scoopers in the U.S. can go unfilled at rates as high as 48%.
“These planes are probably better served in the U.S. and fight fire,” Davis said, adding that private contracting is more established in the U.S. than in Europe and Canada, where aircraft fleets are generally operated by governments.
The company is also working to return two additional Spanish aircraft to service. Davis said one is near airworthy, while the other had required parts that are no longer produced but for which Bridger now has a line of sight. He said the aircraft could potentially become operational as soon as next year.
Shift Toward Guaranteed Revenue
Davis said government agencies have moved toward longer task orders as fire seasons have expanded and aviation resources have remained scarce. Earlier Super Scooper contracts were primarily structured on a call-when-needed basis, requiring the company to maintain aircraft and staff on standby without guaranteed work.
Bridger now has four of its six U.S.-based Super Scoopers on 160-day task orders, which Davis described as a significant milestone. Its two Spain-based aircraft are on 90-day task orders, while eight of the company’s nine surveillance aircraft are committed for multiyear guaranteed-day arrangements.
Under exclusive-use contracts, the company is guaranteed work for a specified number of days. Davis said the guaranteed portion of the company’s business accounts for about half of annual revenue on a normal year, although Bridger does not disclose individual contract rates.
He said pre-positioning aircraft under committed contracts can also increase variable revenue from flight hours because aircraft are available to incident commanders when fires occur.
Bridger expects task orders extending later in the year to shift more activity into the fourth quarter. Davis said the company expects to have one Super Scooper pair deployed through the end of October and another through the end of November. In the prior year, only one pair operated into October and experienced limited flight hours, he said.
Surveillance Technology and IGNIS Platform
Beyond water-dropping aircraft, Bridger is using sensor-equipped planes and its proprietary IGNIS software platform to provide live video, fire modeling, perimeter mapping and ground-resource tracking. Davis said the company has incorporated IGNIS into an existing federal contract with the Department of the Interior through year-end.
The platform is intended to provide information to incident commanders and firefighters in the field. Davis said it can ingest data from sources beyond Bridger aircraft, including drones and satellite partners, through an application programming interface.
According to Davis, the software has reached 20,000 users, primarily firefighters and fire teams, during active incidents. Bridger intends to keep the application free for firefighters while pursuing potential standalone contracts with state and local agencies.
Davis said the software is also supporting aircraft utilization because the company is receiving requests for its aviation services specifically tied to IGNIS capabilities.
Capital, Maintenance and Future Capacity
Bridger completed a refinancing that included a campus sale-leaseback transaction and a $100 million deferred-draw loan facility for aircraft acquisitions and expansion, Davis said. The company used part of that facility to acquire the two Spanish Super Scoopers and add two King Air aircraft.
About $75 million remains available for additional aircraft, sensors and suppression assets, according to Davis. He said the company expects cash generated in the third quarter to support off-season maintenance work, as the business historically generates an estimated 60% to 70% of its revenue during the second half of the year.
Davis also addressed Bridger’s preferred stock, which is currently accruing payment-in-kind dividends at 6% and is scheduled to increase to 9% next year. He said reducing that obligation is part of the company’s balance-sheet strategy.
On future industry supply, Davis said De Havilland Canada is targeting 2028 for production of its new DHC-515 firefighting aircraft. With more than 20 orders associated with government buyers, Davis said he believes newly produced aircraft may not become available to private operators until well into the 2030s.
About Bridger Aerospace Group (NASDAQ:BAER)
Bridger Aerospace Group, Inc operates as an aerial services company specializing in wildfire management and aviation support. The company’s core business activities include aerial wildfire suppression, providing rapid-response water and fire-retardant drops from fixed-wing air tankers. In addition to firefighting, Bridger Aerospace offers aviation services such as cloud seeding for weather modification, aerial inspection and mapping, environmental monitoring, and logistics support for remote sites.
Founded in 2014 and headquartered in Heber City, Utah, Bridger Aerospace Group deploys a fleet of both fixed-wing and rotary-wing aircraft under contract to federal, state and local government agencies as well as commercial customers.
