VistaJet CEO Stands Firm on Financials as Auditor Raises Concerns about Liquidity

VistaJet CEO Thomas Flohr has defended his company’s financial position amid reports of liquidity and debt issues. Responding to concerns about VistaJet’s high debt levels, Flohr stated that all relevant information had always been available to equity and debt holders. VistaJet operates a subscription-based charter service, offering private travel without the burden of owning a private jet.

A recent report indicated that VistaJet had incurred net losses of $436 million over the past four years, with its debt exceeding $4.4 billion as its fleet expanded. Auditing firm EY warned of uncertainties regarding the company’s ability to continue as a going concern. However, Flohr asserted that VistaJet remains profitable on an EBITDA basis, which is the company’s main focus. He emphasized that adjusted EBITDA exceeded $800 million in 2022 and stated that the company’s depreciation policy, which writes off aircraft over a conservative 13-year period, may change in the future.

Flohr also addressed concerns about the company’s prepaid flights versus available cash, clarifying that VistaJet only requires approximately 22% of clients’ up-front payments to cover direct operating expenses. He stressed that these deposits are non-refundable and explained that VistaJet operates on a subscription model, using the funds to serve clients’ flight hours. Flohr expressed confidence in the company’s growth trajectory and its ability to manage debt relative to its EBITDA.

The private jet industry has experienced increased demand since the onset of the COVID-19 pandemic, driven by safety concerns and rising wealth among high-net-worth individuals. Supply chain disruptions and staffing challenges have further contributed to the sector’s increased costs.