PART I - FINANCIAL INFORMATION

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

See accompanying notes to consolidated financial statements.

See accompanying notes to consolidated financial statements.

See accompanying notes to consolidated financial statements.

See accompanying notes to consolidated financial statements.

SAKER AVIATION SERVICES, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Item 2 - Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read together with the accompanying unaudited condensed consolidated financial statements and related notes in this report. This Item 2 contains forward-looking statements that involve risks and uncertainties. Undue reliance should not be placed on these forward-looking statements, which speak only as of the date of this report. Actual results may differ materially from those expressed or implied in such forward-looking statements. Factors which could cause actual results to differ materially are discussed throughout this report and include, but are not limited to, those set forth at the end of this Item 2 under the heading "Cautionary Statement Regarding Forward Looking Statements." Additional factors are under the heading “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

The terms “we”, “us”, and “our” are used below to refer collectively to the Company and the subsidiaries through which our various businesses are actually conducted.

Overview

Saker Aviation Services, Inc. is a Nevada corporation. Our common stock, $0.03 par value per share (the “common stock”), is quoted on the OTCQB Marketplace (“OTCQB”) under the symbol “SKAS”. We were formed on January 17, 2003 as a proprietorship and were incorporated in Arizona on January 2, 2004. We became a public company as a result of a reverse merger transaction on August 20, 2004 with Shadows Bend Development, Inc., an inactive public Nevada corporation, and subsequently changed our name to FBO Air, Inc. On December 12, 2006, we changed our name to FirstFlight, Inc. On September 2, 2009, we changed our name to Saker Aviation Services, Inc.

Our business activities were carried out by FirstFlight Heliports, LLC d/b/a Saker Aviation Services (“FFH”), a wholly-owned subsidiary, as the operator of the Downtown Manhattan Heliport via a concession agreement with the City of New York. On March 4, 2025, the Company was notified by NYCEDC that NYCEDC would be terminating the Concession Agreement effective March 29, 2025. Pursuant to the termination, the Company vacated and ceased use of the Heliport on March 29, 2025. We are currently reviewing alternative business activities as a source of revenue.

REVENUE AND OPERATING RESULTS

Comparison of Operations for the Three Months Ended March 31, 2025 and March 31, 2024.

REVENUE

Revenue from operations decreased by 5.8 percent to $1,260,756 for the three months ended March 31, 2025 as compared with corresponding prior-year period revenue of $1,338,367.

For the three months ended March 31, 2025, revenue from operations associated with the sale of jet fuel and related items decreased by 5.7 percent to approximately $297,000 as compared to approximately $315,000 in the three months ended March 31, 2024. The decrease is primarily attributable to a decrease in activity in 2025 compared to the same period in 2024.

For the three months ended March 31, 2025, revenue from operations associated with services and supply items decreased by 5.7 percent to approximately $937,000 as compared to approximately $994,000 in the three months ended March 31, 2024. The decrease is primarily attributable to a decrease in activity in 2025 compared to the same period in 2024.

For the three month periods ended March 31, 2025 and 2024, all other revenue from operations was approximately $27,000 and $29,000, respectively.

COST OF REVENUE

Total cost of revenue from operations increased by 6.1 percent to $749,396 in the three months ended March 31, 2025, as compared to $706,172 in the three months ended March 31, 2024. The increase in primarily attributable to payment of severance and accrued vacation time to heliport employees in the first quarter 2025.

GROSS PROFIT

Total gross profit from operations decreased by 19.1 percent to $511,360 in the three months ended March 31, 2025 as compared with the three months ended March 31, 2024. Gross margin was 40.6 percent in the three months ended March 31, 2025 as compared to 47.2 percent in the same period in the prior year. The decrease in gross profit and gross margin are primarily attributable to the items discussed above.

OPERATING EXPENSE

Selling, General and Administrative

Total selling, general and administrative expenses, (“SG&A”), from operations were $1,007,464 in the three months ended March 31, 2025, representing an increase of $576,331 or 133.7 percent, as compared to the same period in 2024.

SG&A associated with our operations were approximately $853,000 in the three months ended March 31, 2025, representing an increase of approximately $542,000, or 173.8 percent, as compared to the three months ended March 31, 2024. SG&A associated with our operations, as a percentage of revenue, was 67.7 percent for the three months ended March 31, 2025, as compared with 23.3 percent in the corresponding prior year period. The increase in SG&A on a year-over-year basis is primarily attributable to a one-time charge to record deferred compensation expense relating to a Covenant to Compete Agreement as well as increased professional fees relating to the Company’s ongoing challenge, and pending litigation, of the NYCEDC selection of the heliport’s new operator.

Corporate SG&A from operations was approximately $154,000 for the three months ended March 31, 2025, representing an increase of approximately $35,000 as compared with the corresponding prior year period. The increased corporate expenses were primarily attributable to an increase in services provided by various service providers.

OPERATING (LOSS) INCOME

Operating loss from operations for the three months ended March 31, 2025 was $(496,104) as compared to operating income of $201,062 in the three months ended March 31, 2024. The change on a year-over-year basis was largely attributable to the items discussed above.

Depreciation

Depreciation for both the three months ended March 31, 2025 and 2024 was $3,879.

Interest Income

Interest income for the three months ended March 31, 2025 and 2024 was $78,671 and $91,228, respectively. The decrease is primarily attributable to lower interest rates in 2025 compared to 2024.

Income Tax

Income tax expense for the three months ended March 31, 2025 and 2024 was $0 and $105,000, respectively.

Net (Loss) Income Per Share

Net (loss) income was $(514,765) and $187,290 for the three months ended March 31, 2025 and 2024, respectively. The change on a year-over-year basis was largely attributed to the items discussed above.

Basic net (loss) income per share for the three months ended March 31, 2025 and 2024 was $(0.52) and $0.19, respectively. Diluted net (loss) income per share for the three months ended March 31, 2025 and 2024 was $(0.51) and $0.18, respectively.

LIQUIDITY AND CAPITAL RESOURCES

As of March 31, 2025, we had cash and cash equivalents of $5,303,768 and a working capital surplus of $9,265,051. For the three months ended March 31, 2025, we generated revenue from operations of $1,260,756 and had a net loss of $(514,765). For the three months ended March 31, 2025, cash flows included net cash provided by operating activities of $34,789, which included net loss of $(514,765), and cash used in investing activities of $29,743.

On March 15, 2018, the Company entered into a loan agreement for a $1,000,000 revolving line of credit (the “Key Bank Revolver Note”) which, at the discretion of the Bank, provides for the Company to borrow up to $1,000,000 for working capital and general corporate purposes. On November 22, 2023, the Bank reduced the amount available under the Key Bank Revolver Note to $500,000. This revolving line of credit is a demand note with no stated maturity date. Borrowings under the Key Bank Revolver Note will bear interest at a rate per annum equal to Daily Simple SOFR plus 2.75%. The Company is required to make monthly payments of interest on any outstanding principal under the Key Bank Revolver Note and is required to pay the entire balance, including principal and all accrued and unpaid interest and fees, upon demand by the Bank. Any proceeds from the Key Bank Revolver Note would be secured by substantially all of the Company’s assets. There were no amounts due under the Key Bank Revolver Note at March 31, 2025 or 2024.

The Company has invested its excess working capital reserves in a high yield savings account and government backed securities with UBS Financial Services Inc. (“UBS”).

On February 10, 2025, the Company entered into a Covenant Not To Compete agreement (the “Covenant Agreement”) with Brian Tolbert, the manager of the Downtown Manhattan Heliport (the “Receiving Party”). The Covenant Agreement provides for payments beginning in April 2025, totaling $276,923 over the next 18 months, provided the Receiving Party does not disclose any confidential information to, or accept employment with, the new operator of the Heliport or any of its subsidiaries. The Company has recorded the liability and expense in the Company’s Condensed Consolidated Balance Sheets and Condensed Consolidated Statements of Operation as of March 31, 2025.

Cash from Operating Activities

For the three months ended March 31, 2025, net cash provided by operating activities was $34,789. This amount included an increase in operating cash related to net loss of $(514,765) and additions for the following items: (i) depreciation and amortization, $3,879; (ii) stock-based compensation, $27,097; (iii) write-off of relinquished assets, net of depreciation, $104,339; (iv) accounts receivable, trade, $128,422; (v) inventory, $6,647; (vi) prepaid expenses, $519,194; (vii) deferred liabilities, $276,923; (viii) customer deposits, $2,852; and (ix) accounts payable, $105,644. These increases in operating activities were offset by a decrease in accrued expenses of $618,436 and realized gain on investments of $7,007.

For the three months ended March 31, 2024, net cash provided by operating activities was $193,497. This amount included an increase in operating cash related to net profit of $187,290 and additions for the following items: (i) depreciation and amortization, $3,879; (ii) stock-based compensation, $25,420; (iii) accounts receivable, trade, $55,933; (iv) prepaid expenses, $85,598; (v) customer deposits, $3,126; and (vi) accrued expenses, $99,493. These increases in operating activities were offset by (i) inventories, $4,279; and (ii) accounts payable, $262,963.

Cash from Investing Activities

For the three months ended March 31, 2025, net cash used in investing activities was $(29,743). This amount included purchases of investments of $732,598 and the purchase of property and equipment of $6,145, offset by the sale of investments of $709,000.

For the three months ended March 31, 2024, cash used in investing activities was $922,869. This amount included purchases of investments of $920,699 and the purchase of property and equipment of $2,170.

CAUTIONARY STATEMENT FOR FORWARD-LOOKING STATEMENTS

Statements contained in this report may contain information that includes or is based upon "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements represent management's current judgment and assumptions, and can be identified by the fact that they do not relate strictly to historical or current facts. Forward-looking statements are frequently accompanied by the use of such words as "anticipates," "plans," "believes," "expects," and similar expressions. Such forward-looking statements involve known and unknown risks, uncertainties, and other factors, including, but not limited to, those relating to:

Any one of these or other risks, uncertainties, other factors, or any inaccurate assumptions made by the Company may cause actual results to be materially different from those described herein or elsewhere by us. Undue reliance should not be placed on any such forward-looking statements, which speak only as of the date they were made. Certain of these risks, uncertainties, and other factors are described in greater detail in our Annual Report on Form 10-K for the year ended December 31, 2024 and in other filings we make with the SEC. Subsequent written and oral forward-looking statements attributable to us or to persons acting on our behalf are expressly qualified in their entirety by the cautionary statements set forth above and elsewhere in our reports filed with the SEC. We expressly disclaim any intent or obligation to update any forward-looking statements, except as may be required by law.

Item 3 – Quantitative and Qualitative Disclosures about Market Risk

Not applicable.

Item 4 – Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Management, including our President (principal financial officer) and Chief Executive Officer (principal executive officer), have evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15 and 15d-15(e)) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based upon, and as of the date of that evaluation, our President and our Chief Executive Officer concluded that the disclosure controls and procedures were effective, in all material respects, to ensure that information required to be disclosed in the reports filed and submitted by us under the Exchange Act, is (i) recorded, processed, summarized and reported as and when required, and (ii) is accumulated and communicated to our management, including our President and our Chief Executive Officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control Over Financial Reporting

There has been no change in our internal control over financial reporting that occurred during the fiscal quarter covered by this Quarterly Report on Form 10-Q that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

Item-1 – Legal Proceedings

On November 20, 2024 the Company was notified by the NYCEDC that NYCEDC intends to award the Concession Agreement for the operation of the Downtown Manhattan Heliport to another company (“Skyport”). On March 31, 2025, the Company filed a petition with the Supreme Court of the State of New York County of New York requesting among other things, an order directing the City of New York to produce non-privileged documentation related to its decision to award the Concession Agreement to Skyport, which the Company has already requested, and a judgement annulling the award of the Concession Agreement to Skyport and directing the city to award the Concession Agreement to another company. The petition alleges a number of misrepresentations made by Skyport to the city which the Company believes helped Skyport secure the Concession Agreement.

Item–1A – Risk Factors

For a discussion of the Company’s potential risks or uncertainties, please see: (i) “Part I—Item 1A—Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC.

Item 6 - Exhibits

* Filed herewith

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.