VistaJet cash reserves drop as super-rich cut travel plans

VistaJet’s cash has dropped to its lowest level since the start of the pandemic after the heavily indebted luxury airline’s super-rich customers scaled back their travel plans. Flying hours bought in advance through the private jet provider’s subscription service were 10.5% lower in the nine months to the end of September than the same period a year earlier, according to financial statements reviewed by the Financial Times. That left its cash reserves at $62m, the lowest level since 2020 when Covid-19 grounded aircraft around the world. The drop in advance sales of flying hours by the Dubai group, a debt-fuelled rival to market leader NetJets whose membership scheme allows customers to book a plane with as little as 24 hours notice, comes after a full-year decline in 2023. Details of the accounts follow reports that VistaJet, whose $4.5b of debt was used to purchase top-of-the-line aircraft and smaller rivals, has attempted to raise as much as $1bn in new financing in recent months. When sales of programme hours were growing they helped fund Vista’s operations because it receives subscription payments upfront then recognises the revenue only when the hours are used. The reversal of that trend is a headwind for Vista’s Swiss founder and owner Thomas Flohr, who has long defied concerns raised by some rivals, critics and the group’s previous accountants that its asset-heavy business model may be unsustainable. A combination of borrowing, $140m of net losses and substantial short-term liabilities prompted auditor EY to warn in its opinion on the company’s 2022 accounts that “a material uncertainty exists that may cast significant doubt on the group’s ability to continue as a going concern”. <br/>