10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For The Quarterly Period Ended March 31, 2020

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______________ to ________________

Commission File Number: 000-52593

SAKER AVIATION SERVICES, INC.

(Exact Name of Registrant as Specified in Its Charter)

Nevada	87-0617649
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)
20 South Street, Pier 6 East River, New York, NY	10004
(Address of principal executive offices)	(Zip Code)

(212) 776-4046

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act: None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒         No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.05 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒         No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐	Non-accelerated filer	☒	Smaller reporting company	☒
Emerging growth company ☐

If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards pursuant to Section 13(a) of the Exchange Act.  ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐          No ☒

As of May 15, 2020, the registrant had 1,023,744 shares of its common stock, $0.03 par value, issued and outstanding.

i

SAKER AVIATION SERVICES, INC. AND SUBSIDIARIES

Form 10-Q

March 31, 2020

Index

PART I - FINANCIAL INFORMATION
	ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS		Page
		Balance Sheets as of March 31, 2020 (unaudited) and December 31, 2019	1
		Statements of Operations for the Three Months Ended March 31, 2020 and 2019 (unaudited)	2
		Statements of Stockholders’ Equity for the Three Months Ended March 31, 2020 and 2019 (unaudited)	3
		Statements of Cash Flows for the Three Months Ended March 31, 2020 and 2019 (unaudited)	4
		Notes to Financial Statements (unaudited)	5
	ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND  RESULTS OF OPERATIONS		9
	ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK		15
	ITEM 4. CONTROLS AND PROCEDURES		15
PART II - OTHER INFORMATION
	ITEM 1A. RISK FACTORS		16
	ITEM 6. EXHIBITS		17
SIGNATURES			18

ii

SAKER AVIATION SERVICES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

	March 31,			December 31,
	2020			2019
	(unaudited)
ASSETS
CURRENT ASSETS
Cash	$	3,143,675		$	3,597,491
Accounts receivable		552,171			678,045
Inventories		161,350			181,204
Notes receivable		188,828			188,828
Held for sale assets		270,000			270,000
Prepaid expenses and other current assets		196,586			294,644
Total current assets		4,512,610			5,210,212
PROPERTY AND EQUIPMENT, net of accumulated depreciation and amortization of $3,696,006 and $3,676,488 as of March 31, 2020 and December 31, 2019, respectively		308,710			323,316
OTHER ASSETS
Deposits		2,512			2,512
Right of use assets		482,088			495,377
Goodwill		750,000			750,000
Deferred income taxes		476,000			476,000
Total other assets		1,710,600			1,723,889
TOTAL ASSETS	$	6,531,920		$	7,257,417
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable	$	27,322		$	397,343
Customer deposits		130,821			130,395
Accrued dividends payable		245,402			373,370
Accrued expenses		179,166			319,557
Right of use leases payable – current portion		61,028			60,675
Total current liabilities		643,739			1,281,340
LONG-TERM LIABILITIES
Right of use leases payable - less current portion		389,326			399,733
Total liabilities		1,033,065			1,681,073
STOCKHOLDERS’ EQUITY
Preferred stock - $0.03 par value; authorized 333,306; none issued and outstanding
Common stock - $0.03 par value; authorized 3,333,334; 1,023,744 and 1,020,135 shares issued and outstanding as of March 31, 2020 and December 31, 2019, respectively		30,712			30,604
Additional paid-in capital		19,837,180			19,818,637
Accumulated deficit		(14,369,037	)		(14,272,897	)
TOTAL STOCKHOLDERS’ EQUITY		5,498,855			5,576,344
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	6,531,920		$	7,257,417

See accompanying notes to condensed consolidated financial statements.

1

SAKER AVIATION SERVICES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

	For the Three Months Ended
	March 31,
	2020			2019
REVENUE	$	1,673,755		$	2,072,772
COST OF REVENUE		1,081,665			1,183,237
GROSS PROFIT		592,090			889,535
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES		693,577			831,956
OPERATING (LOSS) INCOME FROM OPERATIONS		(101,487	)		57,579
OTHER INCOME (EXPENSE):
INTEREST INCOME		6,576			8,408
INTEREST (EXPENSE)		(1,229	)		(2,651	)
NET OTHER INCOME		5,347			5,757
(LOSS) INCOME FROM OPERATIONS, before income taxes		(96,140	)		63,336
INCOME TAX EXPENSE		0			(11,000	)
NET (LOSS) INCOME	$	(96,140	)	$	52,336
Basic and Diluted Net (Loss) Income Per Common Share	$	(0.09	)	$	0.05
Weighted Average Number of Common Shares – Basic		1,022,515			1,007,293
		1,038,899			1,019,572
Weighted Average Number of Common Shares – Diluted

See accompanying notes to condensed consolidated financial statements.

2

SAKER AVIATION SERVICES, INC. AND SUBSIDIARIES

STATEMENTS OF CONDENSED STOCKHOLDERS' EQUITY

(UNAUDITED)

					Additional					Total
	Common Stock				Paid-in		Accumulated			Stockholders’
	Shares		Amount		Capital		Deficit			Equity
BALANCE – January 1, 2019		1,006,768	$	30,203	$	19,756,839	$	(14,440,541	)	$	5,346,501
Issuance of additional Common Stock in connection with reverse split		525		16		-16					0
Amortization of stock based compensation						8,500
Net income								52,336			52,336
BALANCE – March 31, 2019		1,007,293	$	30,219	$	19,765,323	$	(14,388,205	)	$	5,407,337
BALANCE – January 1, 2020		1,020,135	$	30,604	$	19,818,637	$	(14,272,897	)	$	5,576,344
Issuance of additional Common Stock		3,609		108		-108					0
Amortization of stock based compensation						18,651					18,651
Net loss								(96,140	)		(96,140	)
BALANCE – March 31, 2020		1,023,744	$	30,712	$	19,837,180	$	(14,369,037	)	$	5,498,855

See accompanying notes to condensed consolidated financial statements.

3

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

	Three Months Ended March 31,
	2020			2019
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) income	$	(96,140	)	$	52,336
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization		32,807			21,818
Stock based compensation		18,651			8,500
Changes in operating assets and liabilities:
Accounts receivable, trade		125,874			30,614
Inventories		19,854			(19,727	)
Prepaid expenses and other current assets		98,058			112,487
Customer deposits		426			1,861
Accounts payable		(370,021	)		20,281
Accrued expenses		(140,391	)		14,881
TOTAL ADJUSTMENTS		(214,742	)		190,715
NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES		(310,882	)		243,051
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment		(4,912	)		(42,128	)
NET CASH USED IN INVESTING ACTIVITIES		(4,912	)		(42,128	)
CASH FLOWS FROM FINANCING ACTIVITIES
Dividends paid		(127,968	)		---
Repayment of right of use leases payable		(10,054	)		(6,147	)
Repayment of notes payable		---			(82,228	)
NET CASH USED IN FINANCING ACTIVITIES		(138,022	)		(88,375	)
NET CHANGE IN CASH		(453,816	)		112,548
CASH – Beginning		3,597,491			2,838,649
CASH – Ending	$	3,143,675		$	2,951,197
NON-CASH OPERATING AND INVESTING ACTIVITIES:
Change in Accounts Receivable through issuance of a Note Receivable	$	---		$	276,036
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the periods for:
Interest	$	1,229		$	2,651
Income taxes	$	28,079		$	---

See accompanying notes to condensed consolidated financial statements.

4

SAKER AVIATION SERVICES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

NOTE 1 - Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of Saker Aviation Services, Inc. (the “Company”) and its subsidiaries have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial statements and in accordance with the instructions to Form 10-Q. Accordingly, they do not include all of the information and disclosures required by GAAP for annual financial statements and should be read in conjunction with the financial statements and related footnotes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.

The condensed consolidated balance sheet as of March 31, 2020 and the condensed consolidated statements of operations and cash flows for the three months ended March 31, 2020 and 2019 have been prepared by the Company without audit. In the opinion of the Company’s management, all necessary adjustments (consisting of normal recurring accruals) have been included to make the Company’s financial position as of March 31, 2020 and its results of operations and cash flows for the three months ended March 31, 2020 not misleading. The results of operations for the three months ended March 31, 2020 are not necessarily indicative of the results to be expected for any full year or any other interim period.

Since December 2019, the novel coronavirus (“COVID-19”) has spread to many countries and the World Health Organization has declared COVID-19 a pandemic. Federal, state, and local governments have implemented certain travel restrictions, “stay-at-home” orders, and social distancing initiatives which have negatively impacted our operations. As a result of the ongoing COVID-19 pandemic, as of March 17, 2020 all sightseeing tour operations at the Downtown Manhattan Heliport ceased due to a drop in demand. The extent of the impact of the COVID-19 pandemic on our operational and financial performance will depend on future developments, including the duration and spread of the COVID-19 pandemic and related travel advisories and restrictions, and the impact of the COVID-19 pandemic on overall demand for air travel, all of which are highly uncertain and cannot be predicted. Based on the impact that the COVID-19 pandemic has already had on our business, we expect to experience a decrease in revenue for the fiscal year ending December 31, 2020 relative to prior year periods.

NOTE 2 – Liquidity and Material Agreements

As of March 31, 2020, we had cash of $3,143,675 and a working capital surplus of $3,868,871. We generated revenue of $1,673,755 and had a net loss of $(96,140) for the three months ended March 31, 2020. For the three months ended March 31, 2020, cash flows included net cash used in operating activities of $310,882, net cash used in investing activities of $4,912, and net cash used in financing activities of $138,022.

As disclosed in a Current Report on Form 8-K filed on March 21, 2018 with the Securities and Exchange Commission (the “SEC”), on March 15, 2018 the Company entered into a loan agreement (the “Loan Agreement”) with Key Bank National Association (the “Bank”). The Loan Agreement contains three components: (i) a $2,500,000 acquisition line of credit (the “Key Bank Acquisition Note”); (ii) a $1,000,000 revolving line of credit (the “Key Bank Revolver Note”); and (iii) a $338,481 term loan (the “Key Bank Term Note”).

Proceeds of the Key Bank Acquisition Note were to be disbursed pursuant to a multiple draw demand note dated as of the agreement date, where the Company could, at the discretion of the Bank, borrow up to an aggregate amount of $2,500,000, to be used for the Company’s acquisition of one or more business entities. Until the Change of Terms Agreement, as defined below, the Company was required to make consecutive monthly payments of interest, calculated at a rate per annum equal to one-day LIBOR (adjusted daily) plus 2.75%, on any outstanding principal under the Key Bank Acquisition Note from the date of its issuance through September 15, 2018 (the “Conversion Date”).

At any time through and including the Conversion Date, at the Bank’s discretion, the Company had the opportunity to request that any loan made under the Key Bank Acquisition Note be converted into a term loan to be repaid in full, including accrued interest, by consecutive monthly payments over a 48 month amortization period beginning after the Conversion Date. For any loan that was not converted into a term loan on or before the Conversion Date, the Company would have been required to begin making monthly payments of principal and interest after the Conversion Date, over a 48 month amortization period, after which the remaining unpaid principal and accrued interest would have become due and payable. All loans under the Key Bank Acquisition Note would have, after the Conversion Date, accrued interest at a rate per annum equal to the Bank’s four year cost of funds rate plus 2.5%. As of the Conversion Date, there were no amounts due under the Key Bank Acquisition Note and no amounts had been converted to a term loan.

5

SAKER AVIATION SERVICES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

On October 11, 2018, and as subsequently amended, the Company entered into a new loan agreement with the Bank (as so amended, the “Change of Terms Agreement”) which modified the original terms of the Key Bank Acquisition Note. Under the Change of Terms Agreement, the Company may continue to, at the discretion of the Bank, borrow up to an aggregate amount of $2,500,000 through June 30, 2020 (the “Maturity Date”), to be used for the Company’s acquisition of one or more business entities. The Change of Terms Agreement requires the Company to make consecutive monthly payments of interest on any outstanding principal calculated at a rate per annum equal to 4.25%. The entire principal balance, plus all accrued interest, is due in full on the Maturity Date. As of March 31, 2020, there were no amounts due under the Change of Terms Agreement.

Proceeds from the Key Bank Revolver Note, at the discretion of the Bank, provide for the Company to borrow up to $1,000,000 for working capital and general corporate purposes. 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 one-day LIBOR (adjusted daily) 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. As of March 31, 2020, there were no amounts due under the Key Bank Revolver Note.

Proceeds from the Key Bank Term Note were utilized to retire amounts previously outstanding under a $280,920 term loan from PNC Bank. As of March 31, 2020, all amounts outstanding under the Key Bank Term Note have been repaid.

The Company is party to a Concession Agreement, dated as of November 1, 2008, with the City of New York for the operation of the Downtown Manhattan Heliport (the “Concession Agreement”). Pursuant to the terms of the Concession Agreement, the Company must pay the greater of 18% of the first $5,000,000 in any program year based on cash collected (“Gross Receipts”) and 25% of Gross Receipts in excess of $5,000,000, or minimum annual guaranteed payments. During the three months ended March 31, 2020 and 2019, we incurred approximately $254,000 and $337,000 in concession fees, respectively, which are recorded in the cost of revenue.

As disclosed in a Current Report on Form 8-K filed with the SEC on February 5, 2016, the Company and the New York City Economic Development Corporation (the “NYCEDC”) announced new measures to reduce helicopter noise and impacts across New York City (the “Air Tour Agreement”).

Under the Air Tour Agreement, filed as an exhibit to our Annual Report on Form 10-K for the year ended December 31, 2015, the Company may not allow its tenant operators to conduct tourist flights from the Downtown Manhattan Heliport on Sundays beginning April 1, 2016. The Company was also required to ensure that its tenant operators reduce the total allowable number of tourist flights from 2015 levels by 20 percent beginning June 1, 2016, by 40 percent beginning October 1, 2016 and by 50 percent beginning January 1, 2017. Additionally, beginning on June 1, 2016, the Company was required to provide monthly written reports to the NYCEDC and the New York City Council detailing the number of tourist flights conducted out of the Downtown Manhattan Heliport compared to 2015 levels, as well as information on any tour flight that flies over land and/or strays from agreed upon routes.

The Air Tour Agreement also extended the Concession Agreement for 30 months, resulting in a new expiration date of April 30, 2021. The City of New York has two one-year options to further extend the Concession Agreement. The Air Tour Agreement also provides that the minimum annual guarantee payments the Company is required to pay to the City of New York under the Concession Agreement be reduced by 50%, effective January 1, 2017.

These reductions have negatively impacted the Company’s business and financial results as well as those of its management company at the Heliport, Empire Aviation which, as previously disclosed, is owned by the children of a former officer and director of the Company.  The Company incurred management fees with Empire Aviation of approximately $86,000 and $248,000 during the three months ended March 31, 2020 and 2019, respectively, which is recorded in administrative expenses. The Company and Empire Aviation have also contributed to the Helicopter Tourism and Jobs Council (“HTJC”), an association that lobbies on behalf of the helicopter air tour industry, and which had engaged in discussions with the Mayor’s office.  The Company’s former officer and director is also an active participant with HJTC, which is managed by the former officer and director’s grandson. One of our Directors, Sam Goldstein, serves as deputy director of HJTC.  

On April 20, 2018, the Company’s Kansas subsidiary entered into a purchase lease with Commerce Bank for a refueling truck (the “Truck Lease”). The Truck Lease commenced on May 1, 2018 and continues for 60 months at an interest rate of LIBOR plus 416 basis points. At the end of the Truck Lease, the Company’s subsidiary may purchase the vehicle for $1.00.

On January 15, 2019, the Company was issued an unsecured note by one of its customers at the Heliport. The note schedules payments of approximately $276,000 in receivables payable by such customer, had a maturity date of October 31, 2019, as amended, and carries a 7.5% rate of interest. The note payments were to be made in six monthly installments beginning May 31, 2019. The customer’s payments on the note have not met the installment plan and the Company was working on changes to the note when the customer filed for Chapter 11 Bankruptcy. The Company intends to pursue remaining amounts due under the note and it is the Company’s expectation that the note will be fulfilled.

6

SAKER AVIATION SERVICES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

As disclosed in a Current Report on Form 8-K filed with the SEC on July 6, 2015, the Company entered into a stock purchase agreement, dated June 30, 2015, by and between the Company and Warren A. Peck, pursuant to which Mr. Peck purchased all of the capital stock of the Company’s wholly-owned subsidiary, Phoenix Rising Aviation, Inc. The details of the agreement are described in such Current Report as well as in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015, which was filed with the SEC on April 11, 2016. The Company received $100,000 due under this agreement in September 2017 and an additional payment of $100,000 in September 2018. In 2019, the Company accepted the title to a Falcon 10 aircraft owned by Mr. Peck as satisfaction in full of the remainder of the $270,000 stock purchase price. The Company intends to sell the aircraft and has classified it as “Held For Sale” on the Company’s Consolidated Balance Sheets as of March 31, 2020.

As described throughout this Quarterly Report on Form 10-Q, on March 17, 2020, all sightseeing tour operations at the Downtown Manhattan Heliport ceased due to the drop in demand as a result of the COVID-19 pandemic. To mitigate the loss of revenue due to the temporary suspension in operations, we may need additional financing to continue operations through the issuance of equity or debt and any such financing will be dependent on general market conditions, which itself is subject to the effects of the COVID-19 pandemic. Although we have access to the Key Bank Revolver Note described above, we can make no assurance that that the Key Bank Revolver Note will be sufficient to fund our operations. Additionally, certain restrictions in the Key Bank Revolver Note may prohibit us from obtaining more attractive financing.

NOTE 3 - Summary of Significant Accounting Policies

Principles of Consolidation

The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, FirstFlight Heliports, LLC, and its fixed base operation and aircraft maintenance and repair services at Garden City (Kansas) Regional Airport. All significant inter-company accounts and transactions have been eliminated in consolidation.

Net (Loss) Income Per Common Share

Net (loss) income was $(96,140) and $52,336 for the three months ended March 31, 2020 and 2019, respectively. Basic net income per share applicable to common stockholders is computed based on the weighted average number of shares of the Company’s common stock outstanding during the periods presented. Diluted net income per share reflects the potential dilution that could occur if securities or other instruments to issue common stock were exercised or converted into common stock. Potentially dilutive securities, consisting of options and warrants, are excluded from the calculation of the diluted income per share when their exercise prices were greater than the average market price of the common stock during the period. 

The following table sets forth the components used in the computation of basic net income per share:

	For the Three Months Ended March 31,
	2020		2019
Weighted average common shares outstanding, basic		1,022,515		1,007,293
Common shares upon exercise of options		16,384		12,279
Weighted average common shares outstanding, diluted		1,038,899		1,019,572

Stock-Based Compensation

Stock-based compensation expense for all stock-based payment awards are based on the estimated grant-date fair value. The Company recognizes these compensation costs over the requisite service period of the award, which is generally the option vesting term. For the three months ended March 31, 2020 and 2019, the Company incurred stock-based compensation of $18,651 and $8,500, respectively. Such amounts have been recorded as part of the Company’s selling, general and administrative expenses in the accompanying consolidated statements of operations. As of March 31, 2020, the unamortized fair value of the options totaled $56,009 and the weighted average remaining amortization period of the options approximated five years.

Option valuation models require the input of highly subjective assumptions, including the expected life of the option. Because the Company's employee stock options have characteristics significantly different from those of traded options, and because changes in the subjective input assumptions can materially affect the fair value estimate, in management's opinion, the existing models do not necessarily provide a reliable single measure of the fair value of its employee stock options.

7

SAKER AVIATION SERVICES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Recently Adopted Accounting Pronouncements

In February 2016, the FASB issued ASU No. 2016-02, “Leases” (“ASU 2016-02”), which requires an entity to recognize assets and liabilities on the balance sheet for the rights and obligations created by leased assets and provide additional disclosures. ASU 2016-02 became effective for us on January 1, 2019 and we have adopted the new standard using a modified retrospective approach. The adoption of ASU No. 2016-02 did not have a material impact on the Company’s financial statements.

NOTE 4 – Inventories

Inventory consists primarily of aviation fuel, which the Company dispenses to its customers, and parts inventory as a result of the acquisition of Aircraft Services, Inc. The Company also maintains fuel inventories for commercial airlines, to which it charges into-plane fees when servicing commercial aircraft.

Inventories consist of the following:

	March 31, 2020		December 31, 2019
Parts inventory	$	86,142	$	87,625
Fuel inventory		62,778		79,497
Other inventory		12,430		14,082
Total inventory	$	161,350	$	181,204

Included in fuel inventory are amounts held for third parties of $38,125 and $25,804 as of March 31, 2020 and December 31, 2019, respectively, with an offsetting liability included as part of accrued expenses.

NOTE 5 – Related Parties

From time to time, the law firm of Wachtel Missry, LLP provides certain legal services to the Company and its subsidiaries. William B. Wachtel, Chairman of the Company’s Board of Directors, is a managing partner of such firm. During the three months ended March 31, 2020, no services were provided to the Company by Wachtel & Missry, LLP.

As described in more detail in Note 2, Liquidity and Material Agreements, the Company is party to a management agreement with Empire Aviation, an entity owned by the children of the Company’s former Chief Executive Officer and a former member of our Company’s Board of Directors.

NOTE 6 – Litigation

From time to time, we may be a party to one or more claims or disputes which may result in litigation. However, we are currently not a party to, nor is our property subject to, any material pending legal proceedings.

NOTE 7 - Stockholders’ Equity

On February 27, 2019, the Company filed with the Secretary of State of the state of Nevada a certificate of amendment to its articles of incorporation. The amendment provided for a reverse stock split (the “Reverse Stock Split”) of the Company’s outstanding shares of common stock at a ratio of 1-for-30. This amendment further provided for a reduction in the number of authorized shares of common stock to 3,333,334, as well as for a reduction in the number of authorized shares of preferred stock to 333,306. The amendment had an effective date and time of 12:01 a.m. Eastern Time on March 1, 2019 for stockholders of record on February 27, 2019. Accordingly, the Company presents historical share data in the condensed consolidated financial statements after giving effect to the Reverse Stock Split.

NOTE 8 – Dividend Payable

On September 30, 2019, the Company announced that its Board of Directors had declared a special cash dividend of $0.50 per share (the “Dividend”). The Dividend is being paid in equal quarterly installments of $0.125 per share which began on November 1, 2019, with the final dividend scheduled to be paid on August 28, 2020. The total amount of future cash dividends to be paid has been accrued in the Company’s consolidated balance sheets as of March 31, 2020.

8

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, 2019.

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”. Through our subsidiaries, we operate in the aviation services segment of the general aviation industry, in which we serve as the operator of a heliport, a fixed base operation (“FBO”), a provider of aircraft maintenance and repair services (“MRO”), and as a consultant for a seaplane base that we do not own. FBOs provide ground-based services, such as fueling and aircraft storage for general aviation, commercial and military aircraft, and other miscellaneous services.

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 are carried out as the operator of the Downtown Manhattan (New York) Heliport and as an FBO and MRO at the Garden City (Kansas) Regional Airport.

The Garden City facility became part of our company as a result of our acquisition of the FBO assets of Central Plains Aviation, Inc. in March 2005 and of Aircraft Services, Inc. in October 2016.

Our business activities at the Downtown Manhattan (New York) Heliport facility (the “Heliport”) commenced in November 2008 when we were awarded the Concession Agreement by the City of New York to operate the Heliport, which we assigned to our subsidiary, FirstFlight Heliports, LLC d/b/a Saker Aviation Services (“FFH”).

              Since December 2019, COVID-19 has spread to many countries and the World Health Organization has declared COVID-19 a pandemic. Federal, state, and local governments have implemented certain travel restrictions, “stay-at-home” orders, and social distancing initiatives which have negatively impacted our operations. As a result of the ongoing COVID-19 pandemic, as of March 17, 2020, all sightseeing tour operations at the Downtown Manhattan Heliport ceased due to a drop in demand. The extent of the impact of the COVID-19 pandemic on our operational and financial performance will depend on future developments, including the duration and spread of the COVID-19 pandemic and related travel advisories and restrictions and the impact of the COVID-19 pandemic on overall demand for air travel, all of which are highly uncertain and cannot be predicted. Based on the impact that the COVID-19 pandemic has already had on our business, we expect to experience a decrease in revenue for the fiscal year ending December 31, 2020 relative to prior year periods.

9

REVENUE AND OPERATING RESULTS

Comparison of Continuing Operations from the Three Months Ended March 31, 2020 and March 31, 2019.

REVENUE

             Operating results for the three month period ended March 31, 2020 were negatively impacted by the ongoing COVID-19 pandemic. The COVID-19 pandemic has depressed year-over-year activity at our Heliport and, consequently, the results reported below.

Revenue from operations decreased by 19.3 percent to $1,673,755 for the three months ended March 31, 2020 as compared with corresponding prior-year period revenue of $2,072,772.

For the three months ended March 31, 2020, revenue from operations associated with the sale of jet fuel, aviation gasoline and related items decreased by 2.9 percent to approximately $807,000 as compared to approximately $830,000 in the three months ended March 31, 2019. This decrease was largely attributable to the lower volume of gallons of aviation gasoline sold at our New York location.

For the three months ended March 31, 2020, revenue from operations associated with services and supply items decreased by 26.4 percent to approximately $853,000 as compared to approximately $1,158,000 in the three months ended March 31, 2019. This decrease was largely attributable to a lower demand for services at our New York location due to the COVID-19 pandemic.

For the three months ended March 31, 2020 all other revenue from operations decreased by 83.1 percent to approximately $14,000 as compared to approximately $83,000 in the three months ended March 31, 2019. This decrease was largely attributable to a decrease in non-aeronautical revenue generated at our New York location compared to the same period last year.

GROSS PROFIT

             Total gross profit from operations decreased by 33.4 percent to $592,090 in the three months ended March 31, 2020 as compared with the three months ended March 31, 2019. Gross profit was negatively impacted by the items previously discussed. Gross margin decreased to 35.4 percent in the three months ended March 31, 2020 as compared to 42.9 percent in the same period in the prior year.

OPERATING EXPENSE

Selling, General and Administrative

             Total selling, general and administrative expenses, (“SG&A”), from operations were $693,577 in the three months ended March 31, 2020, representing a decrease of approximately $138,000 or 16.6 percent, as compared to the same period in 2019.

SG&A from operations associated with our aviation services operations were approximately $576,000 in the three months ended March 31, 2020, representing a decrease of approximately $130,000, or 18.4percent, as compared to the three months ended March 31, 2019. SG&A from operations associated with our FBO operations, as a percentage of revenue, was 34.4 percent for the three months ended March 31, 2020, as compared with 34.1 percent in the corresponding prior year period. The decreased operating expenses were largely attributable to reduced costs related to the lower levels of activity in our Heliport operations.

           Corporate SG&A from operations was approximately $117,000 for the three months ended March 31, 2020, representing a decrease of approximately $8,000 as compared with the corresponding prior year period.

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OPERATING (LOSS) INCOME

Operating loss from operations for the three months ended March 31, 2020 was $(101,487) as compared to operating income of $57,579 in the three months ended March 31, 2019. The decrease in operating income on a year-over-year basis was driven by the factors described above.

Depreciation and Amortization

Depreciation and amortization was approximately $33,000 and $22,000 for the three months ended March 31, 2020 and 2019, respectively.

Interest Income and Expense

Interest income for the three months ended March 31, 2020 was approximately $7,000 as compared to approximately $8,000 in the same period in 2019. Interest expense for the three months ended March 31, 2020 was approximately $1,000 as compared to approximately $3,000 in the same period in 2019.

Income Tax

Income tax expense for the three months ended March 31, 2020 was $0 as compared to $11,000 during the same period in 2019. The decrease is attributable to a net loss in the three months ended March 31, 2020 as compared to net income in the same period in 2019.

Net (Loss) Income Per Share

Net (loss) income was $(96,140) and $52,336 for the three months ended March 31, 2020 and 2019, respectively.

Basic and diluted net (loss) income per share for the three month periods ended March 31, 2020 and 2019 was $(0.09) and $0.05, respectively.

LIQUIDITY AND CAPITAL RESOURCES

As of March 31, 2020, we had cash of $3,143,675 and a working capital surplus of $3,868,871. We generated revenue for the three months ended March 31, 2020 of $1,673,755 and had a net loss of $(96,140). For the three months ended March 31, 2020, cash flows included net cash used in operating activities of $310,882, net cash used in investing activities of $4,912, and net cash used in financing activities of $138,022.

As disclosed in a Current Report on Form 8-K filed on March 21, 2018 with the SEC, on March 15, 2018 the Company entered into a loan agreement (the “Loan Agreement”) with Key Bank National Association (the “Bank”). The Loan Agreement contains three components: (i) a $2,500,000 acquisition line of credit (the “Key Bank Acquisition Note”); (ii) a $1,000,000 revolving line of credit (the “Key Bank Revolver Note”); and (iii) a $338,481 term loan (the “Key Bank Term Note”).

Proceeds of the Key Bank Acquisition Note were to be disbursed pursuant to a multiple draw demand note dated as of the agreement date, where the Company could, at the discretion of the Bank, borrow up to an aggregate amount of $2,500,000, to be used for the Company’s acquisition of one or more business entities. Until the Change of Terms Agreement, as defined below, the Company was required to make consecutive monthly payments of interest, calculated at a rate per annum equal to one-day LIBOR (adjusted daily) plus 2.75%, on any outstanding principal under the Key Bank Acquisition Note from the date of its issuance through September 15, 2018 (the “Conversion Date”).

At any time through and including the Conversion Date, at the Bank’s discretion, the Company had the opportunity to request that any loan made under the Key Bank Acquisition Note be converted into a term loan to be repaid in full, including accrued interest, by consecutive monthly payments over a 48 month amortization period beginning after the Conversion Date. For any loan that was not converted into a term loan on or before the Conversion Date, the Company would have been required to begin making monthly payments of principal and interest after the Conversion Date, over a 48 month amortization period, after which the remaining unpaid principal and accrued interest would have become due and payable. All loans under the Key Bank Acquisition Note would have, after the Conversion Date, accrued interest at a rate per annum equal to the Bank’s four year cost of funds rate plus 2.5%. As of the Conversion Date, there were no amounts due under the Key Bank Acquisition Note and no amounts had been converted to a term loan.

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On October 11, 2018, and as subsequently amended, the Company entered into a new loan agreement with the Bank (as so amended, the “Change of Terms Agreement”) which modified the original terms of the Key Bank Acquisition Note. Under the Change of Terms Agreement, the Company may continue to, at the discretion of the Bank, borrow up to an aggregate amount of $2,500,000 through June 30, 2020 (the “Maturity Date”), to be used for the Company’s acquisition of one or more business entities. The Change of Terms Agreement requires the Company to make consecutive monthly payments of interest on any outstanding principal calculated at a rate per annum equal to 4.25%. The entire principal balance, plus all accrued interest, is due in full on the Maturity Date. As of March 31, 2020, there were no amounts due under the Change of Terms Agreement.

Proceeds from the Key Bank Revolver Note, at the discretion of the Bank, provide for the Company to borrow up to $1,000,000 for working capital and general corporate purposes. 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 one-day LIBOR (adjusted daily) 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. As of March 31, 2020, there were no amounts due under the Key Bank Revolver Note.

Proceeds from the Key Bank Term Note were utilized to retire amounts previously outstanding under a $280,920 term loan from PNC Bank. As of March 31, 2020, all amounts outstanding under the Key Bank Term Note have been repaid.

The Company is party to a Concession Agreement, dated as of November 1, 2008, with the City of New York for the operation of the Downtown Manhattan Heliport (the “Concession Agreement”). Pursuant to the terms of the Concession Agreement, the Company must pay the greater of 18% of the first $5,000,000 in any program year based on cash collected (“Gross Receipts”) and 25% of Gross Receipts in excess of $5,000,000, or minimum annual guaranteed payments. During the three months ended March 31, 2020 and 2019, we incurred approximately $254,000 and $337,000 in concession fees, respectively, which are recorded in the cost of revenue.

 As disclosed in a Current Report on Form 8-K filed with the SEC on February 5, 2016, the Company and the New York City Economic Development Corporation (the “NYCEDC”) announced new measures to reduce helicopter noise and impacts across New York City (the “Air Tour Agreement”).

 Under the Air Tour Agreement, filed as an exhibit to our Annual Report on Form 10-K for the year ended December 31, 2015, the Company may not allow its tenant operators to conduct tourist flights from the Downtown Manhattan Heliport on Sundays beginning April 1, 2016. The Company was also required to ensure that its tenant operators reduce the total allowable number of tourist flights from 2015 levels by 20 percent beginning June 1, 2016, by 40 percent beginning October 1, 2016 and by 50 percent beginning January 1, 2017. Additionally, beginning on June 1, 2016, the Company was required to provide monthly written reports to the NYCEDC and the New York City Council detailing the number of tourist flights conducted out of the Downtown Manhattan Heliport compared to 2015 levels, as well as information on any tour flight that flies over land and/or strays from agreed upon routes.

 The Air Tour Agreement also extended the Concession Agreement for 30 months, resulting in a new expiration date of April 30, 2021. The City of New York has two one-year options to further extend the Concession Agreement. The Air Tour Agreement also provides that the minimum annual guarantee payments the Company is required to pay to the City of New York under the Concession Agreement be reduced by 50%, effective January 1, 2017.

12

These reductions have negatively impacted the Company’s business and financial results as well as those of its management company at the Heliport, Empire Aviation which, as previously disclosed, is owned by the children of a prior officer and director of the Company.  The Company incurred management fees with Empire Aviation of approximately $86,000 and $248,000 during the three months ended March 31, 2020 and 2019, respectively, which is recorded in administrative expenses. The Company and Empire Aviation have also contributed to the Helicopter Tourism and Jobs Council (“HTJC”), an association that lobbies on behalf of the helicopter air tour industry, and which had engaged in discussions with the Mayor’s office.  The former officer and director is also an active participant with HJTC, which is managed by the prior officer and director’s grandson. One of our Directors, Sam Goldstein, serves as deputy director of HJTC.  

On April 20, 2018, the Company’s Kansas subsidiary entered into a purchase lease with Commerce Bank for a refueling truck (the “Truck Lease”). The Truck Lease commenced on May 1, 2018 and continues for 60 months at an interest rate of LIBOR plus 416 basis points. At the end of the Truck Lease, the Company’s subsidiary may purchase the vehicle for $1.00.

On January 15, 2019, the Company was issued an unsecured note by one of its customers at the Heliport. The note schedules payments of approximately $276,000 in receivables payable by such customer, had a maturity date of October 31, 2019, as amended, and carries a 7.5% rate of interest. The note payments were to be made in six monthly installments beginning May 31, 2019. The customer’s payments on the note have not met the installment plan and the Company was working on changes to the note when the customer filed for Chapter 11 Bankruptcy. The Company intends to pursue remaining amounts due under the note and it is the Company’s expectation that the note will be fulfilled.

As disclosed in a Current Report on Form 8-K filed with the SEC on July 6, 2015, the Company entered into a stock purchase agreement, dated June 30, 2015, by and between the Company and Warren A. Peck, pursuant to which Mr. Peck purchased all of the capital stock of the Company’s wholly-owned subsidiary, Phoenix Rising Aviation, Inc. The details of the agreement are described in such Current Report as well as in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015, which was filed with the SEC on April 11, 2016. The Company received $100,000 due under this agreement in September 2017 and an additional payment of $100,000 in September 2018. In 2019, the Company accepted the title to a Falcon 10 aircraft owned by Mr. Peck as satisfaction in full of the remainder of the $270,000 stock purchase price. The Company intends to sell the aircraft and has classified it as “Held For Sale” on the Company’s Consolidated Balance Sheets as of March 31, 2020.

As described throughout this Quarterly Report on Form 10-Q, on March 17, 2020, all sightseeing tour operations at the Downtown Manhattan Heliport have ceased due to the drop in demand as a result of the COVID-19 pandemic. To mitigate the loss of revenue due to the temporary suspension in operations, we may need additional financing to continue operations through the issuance of equity or debt and any such financing will be dependent on general market conditions, which itself is subject to the effects of the COVID-19 pandemic. Although we have access to the Key Bank Revolver Note described above, we can make no assurance that that the Key Bank Revolver Note will be sufficient to fund our operations. Additionally, certain restrictions in the Key Bank Revolver Note may prohibit us from obtaining more attractive financing.

During the three months ended March 31, 2020, we had a net decrease in cash of $453,816. Our sources and uses of funds during this period were as follows:

Cash from Operating Activities

For the three months ended March 31, 2020, net cash used in operating activities was $310,882. This amount included a decrease in operating cash related to net loss of $96,140 and additions for the following items: (i) depreciation and amortization, $32,807; (ii) stock based compensation, $18,651; (iii) accounts receivable, trade, $125,874; (iv) inventories, $19,854; (v) prepaid expenses and other current assets, $98,058; and (vi) customer deposits, $426. These increases in operating activities were offset by decreases for the following items: (i) accounts payable; $370,021; and (ii) accrued expenses, $140,391.

For the three months ended March 31, 2019, net cash provided by operating activities was $243,051. This amount included an increase in operating cash related to net income of $52,336 and additions for the following items: (i) depreciation and amortization, $21,818; (ii) stock based compensation, $8,500; (iii) accounts receivable, trade, $30,614; (iv) prepaid expenses and other current assets, $112,487; (v) customer deposits, $1,861; (vi) accounts payable, $20,281; and (vii) accrued expenses, $14,881. These increases in operating activities were offset by a decrease in inventories of $19,727.

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Cash from Investing Activities

For the three months ended March 31, 2020, net cash of $4,912 was used in investing activities for the purchase of property and equipment. For the three months ended March 31, 2019, net cash of $42,128 was used in investing activities for the purchase of property and equipment.

Cash from Financing Activities

For the three months ended March 31, 2020, net cash of $138,022 was used in financing activities for the payment of accrued dividends of $127,968 and repayment of right of use leases payable of $10,054. For the three months ended March 31, 2019, net cash used in financing activities was $88,375 for the repayment of right of use leases payable of $6,147 and repayment of notes payable of $82,228.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Recently Adopted Accounting Pronouncements

In February 2016, the FASB issued ASU No. 2016-02, “Leases” (“ASU 2016-02”), which requires an entity to recognize assets and liabilities on the balance sheet for the rights and obligations created by leased assets and provide additional disclosures. ASU 2016-02 became effective for us on January 1, 2019 and we have adopted the new standard using a modified retrospective approach. The adoption of ASU No. 2016-02 did not have a material impact on the Company’s financial statements.

14

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," "projects," "intends," and similar expressions. Such forward-looking statements involve known and unknown risks, uncertainties, and other factors, including, but not limited to, those relating to:

● the impact of the COVID-19 pandemic on our business and results of operations;

● our ability to secure the additional debt or equity financing, if required, to execute our business plan;

● our ability to identify, negotiate and complete the acquisition of targeted operators and/or other businesses, consistent with our business plan;

● existing or new competitors consolidating operators ahead of us; and

● our ability to attract new personnel or retain existing personnel, which would adversely affect implementation of our overall business strategy.

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, 2019 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, Chief Executive Officer and our principal financial officer, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures 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, Chief Executive Officer and principal financial officer concluded that our 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 Securities Exchange Act of 1934, as amended, is (i) recorded, processed, summarized and reported as and when required, and (ii) is accumulated and communicated to our management, including our President, Chief Executive Officer and principal financial 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.

15

PART II – OTHER INFORMATION

Item 1A - Risk Factors

Except as stated below, there have been no material changes from the risk factors as previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2019.

We will need additional financing to expand our business.

Certain potential aviation services firms which we may seek to acquire in the future may accept shares of our common stock or other securities as payment by us for the acquisition. However, we believe that most will likely prefer cash payments, whether paid at the closing or in post-closing installment payments. There can be no assurance that our operations will generate sufficient cash flow to meet these acquisition obligations, particularly with the uncertainty related to the duration of the COVID-19 pandemic. Accordingly, we anticipate the need to seek additional equity or debt financing to meet any cash requirements for acquisitions. Any such financing will be dependent on general market conditions and the stock market’s evaluation of our performance and potential. With the significant economic and market volatility caused by the COVID-19 pandemic, we can give no assurance that we will obtain such equity or debt financing and, even if we do, that the terms would be satisfactory to us.

The COVID-19 pandemic will have a material adverse impact on the Company's business, operating results and financial condition, and has already resulted in the temporary suspension of our customer’s operations at the Downtown Manhattan Heliport.

The COVID-19 pandemic and its impact on travel demand, travel behavior, or travel restrictions will have a material adverse impact on our business, financial condition and operating results. The pandemic has resulted in increased government restrictions and regulation, including quarantines of our personnel, and future regulations may create an inability to access our facilities, which would adversely affect our operations.

Since December 2019, COVID-19 has spread to many countries and the World Health Organization has declared COVID-19 a pandemic. Federal, state, and local governments have implemented certain travel restrictions, “stay-at-home” orders, and social distancing initiatives which have negatively impacted our operations. As a result of the ongoing COVID-19 pandemic, as of March 17, 2020 all sightseeing tour operations at the Downtown Manhattan Heliport ceased due to a drop in demand. The extent of the impact of the COVID-19 pandemic on our operational and financial performance will depend on future developments, including the duration and spread of the COVID-19 pandemic and related travel advisories and restrictions and the impact of the COVID-19 pandemic on overall demand for air travel, all of which are highly uncertain and cannot be predicted. Based on the impact that the COVID-19 pandemic has already had on our business, we expect to experience a decrease in revenue for the fiscal year ending December 31, 2020 relative to prior year periods.

We expect our business, results of operations and financial condition to be adversely affected by the COVID-19 pandemic.

The COVID-19 pandemic has created significant volatility, uncertainty and economic disruption. Although the full extent to which the coronavirus pandemic impacts our business, operations and financial results is uncertain and will depend on numerous evolving factors that we may not be able to accurately predict, we expect our results for the fiscal year ending December 31, 2020 to be adversely affected. Factors that will determine the full extent to which the COVID-19 pandemic impacts our business include, but are not limited to:

● the duration and scope of the pandemic;

● the length of time our customer’s sightseeing tour operations at the Downtown Manhattan Heliport are suspended due to decreased demand;

● federal, state, and local governmental actions taken in response to the pandemic and the impact of those actions on global economic activity;

● the duration and scope of “stay-at-home” orders implemented in New York City and our other operating regions and social distancing initiatives undertaken by businesses and individuals;

● the actions taken in response to economic disruption, including any federal or state-level economic “phase-in” processes and the impact of such processes on the air tourism industry;

● the impact of business disruptions and reductions in employment levels in the United States;

● our customers’ continuing viability as businesses; and

● the possibility that all of our facilities will be required to close.

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Item 6 - Exhibits

Exhibit No.	Description of Exhibit
31.1	Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer (principal executive officer). *
31.2	Rule 13a-14(a)/15d-14(a) Certification of President (principal financial officer). *
32.1	Section 1350 Certification. *
101.INS	XBRL Instance Document *
101.SCH	XBRL Taxonomy Extension Schema Document. *
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document. *
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document. *
101.LAB	XBRL Taxonomy Extension Label Linkbase Document. *
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document. *

* Filed herewith

17

SIGNATURES

Pursuant to the requirements 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.

		Saker Aviation Services, Inc.
Date:         May 15, 2020	By:		/s/ Ronald J. Ricciardi
			Ronald J. Ricciardi
			President, Chief Executive Officer, Principal Executive Officer, Principal Financial Officer, and Principal Accounting Officer

18

EX-31.1

EXHIBIT 31.1

Certification of Chief Executive Officer

(principal executive officer)

Pursuant To Rule 13a-14(a)/15d-14(a)

I, Ronald J. Ricciardi, certify that:

1.    I have reviewed this Quarterly Report on Form 10-Q of Saker Aviation Services, Inc.;

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s Board of Directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:        May 15, 2020

By:  /s/ Ronald J. Ricciardi

Ronald J. Ricciardi

Chief Executive Officer (principal executive officer)

EX-31.2

EXHIBIT 31.2

Certification of President

(principal financial officer)

Pursuant To Rule 13a-14(a)/15d-14(a)

I, Ronald J. Ricciardi, certify that:

1.    I have reviewed this Quarterly Report on Form 10-Q of Saker Aviation Services, Inc.;

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)  Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.     The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:           May 15, 2020

By:  /s/ Ronald J. Ricciardi

Ronald J. Ricciardi

President (principal financial officer)

EX-32.1

EXHIBIT 32.1

Section 1350 Certification

Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (“Section 906”), Ronald J. Ricciardi, the Chief Executive Officer (principal executive officer) and President (principal financial officer) of Saker Aviation Services, Inc., does hereby certify that:

1.   The Quarterly Report on Form 10-Q for the quarter ended March 31, 2020 (the “Report”) of Saker Aviation Services, Inc. fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2.   The information contained in the Report fairly presents, in all material respects, the financial condition and results of operation of Saker Aviation Services, Inc.

Date: May 15, 2020	By:	/s/ Ronald J. Ricciardi
		Ronald J. Ricciardi
		Chief Executive Officer (principal executive officer)
Date:  May 15, 2020	By:	/s/ Ronald J. Ricciardi
		Ronald J. Ricciardi
		President (principal financial officer)

A signed original of this written statement required by Section 906 has been provided to Saker Aviation Services, Inc. and will be retained by Saker Aviation Services, Inc., and furnished to the Securities and Exchange Commission or its staff upon request.

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Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
REVENUE	$ 1,673,755	$ 2,072,772
COST OF REVENUE	1,081,665	1,183,237
GROSS PROFIT	592,090	889,535
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES	(693,577)	(831,956)
OPERATING (LOSS) INCOME FROM OPERATIONS	(101,487)	57,579
OTHER INCOME (EXPENSE):
INTEREST INCOME	6,576	8,408
INTEREST (EXPENSE)	(1,229)	(2,651)
NET OTHER INCOME	5,347	5,757
(LOSS) INCOME FROM OPERATIONS, before income taxes	(96,140)	63,336
INCOME TAX EXPENSE	0	(11,000)
NET (LOSS) INCOME	$ (96,140)	$ 52,336
Basic and Diluted Net (Loss) Income Per Common Share (in dollars per share)	$ (0.09)	$ 0.05
Weighted Average Number of Common Shares – Basic (in shares)	1,022,515	1,007,293
Weighted Average Number of Common Shares – Diluted (in shares)	1,038,899	1,019,572

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Note 4 - Inventories (Details Textual) - USD ($)	Mar. 31, 2020	Dec. 31, 2019
Fuel [Member]
Inventory Third Party	$ 38,125	$ 25,804

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Note 2 - Liquidity and Material Agreements

3 Months Ended

Mar. 31, 2020

Notes to Financial Statements

Going Concern Disclosure [Text Block]

NOTE

2

–

Liquidity and Material Agreements

As of

March 31, 2020,

we had cash of

$3,143,675

and a working capital surplus of

$3,868,871.

We generated revenue of

$1,673,755

and had a net loss of $(

96,140

) for the

three

months ended

March 31, 2020.

For the

three

months ended

March 31, 2020,

cash flows included net cash used in operating activities of

$310,882,

net cash used in investing activities of

$4,912,

and net cash used in financing activities of

$138,022.

As disclosed in a Current Report on Form

8

-K filed on

March 21, 2018

with the Securities and Exchange Commission (the “SEC”), on

March 15, 2018

the Company entered into a loan agreement (the “Loan Agreement”) with Key Bank National Association (the “Bank”). The Loan Agreement contains

three

components: (i) a

$2,500,000

acquisition line of credit (the “Key Bank Acquisition Note”); (ii) a

$1,000,000

revolving line of credit (the “Key Bank Revolver Note”); and (iii) a

$338,481

term loan (the “Key Bank Term Note”).

Proceeds of the Key Bank Acquisition Note were to be disbursed pursuant to a multiple draw demand note dated as of the agreement date, where the Company could, at the discretion of the Bank, borrow up to an aggregate amount of

$2,500,000,

to be used for the Company’s acquisition of

one

or more business entities. Until the Change of Terms Agreement, as defined below, the Company was required to make consecutive monthly payments of interest, calculated at a rate per annum equal to

one

-day LIBOR (adjusted daily) plus

2.75%,

on any outstanding principal under the Key Bank Acquisition Note from the date of its issuance through

September 15, 2018 (

the “Conversion Date”).

At any time through and including the Conversion Date, at the Bank’s discretion, the Company had the opportunity to request that any loan made under the Key Bank Acquisition Note be converted into a term loan to be repaid in full, including accrued interest, by consecutive monthly payments over a

48

month amortization period beginning after the Conversion Date. For any loan that was

not

converted into a term loan on or before the Conversion Date, the Company would have been required to begin making monthly payments of principal and interest after the Conversion Date, over a

48

month amortization period, after which the remaining unpaid principal and accrued interest would have become due and payable. All loans under the Key Bank Acquisition Note would have, after the Conversion Date, accrued interest at a rate per annum equal to the Bank’s

four

year cost of funds rate plus

2.5%.

As of the Conversion Date, there were

no

amounts due under the Key Bank Acquisition Note and

no

amounts had been converted to a term loan.

On

October 11, 2018,

and as subsequently amended, the Company entered into a new loan agreement with the Bank (as so amended, the “Change of Terms Agreement”) which modified the original terms of the Key Bank Acquisition Note. Under the Change of Terms Agreement, the Company

may

continue to, at the discretion of the Bank, borrow up to an aggregate amount of

$2,500,000

through

June 30, 2020 (

the “Maturity Date”), to be used for the Company’s acquisition of

one

or more business entities. The Change of Terms Agreement requires the Company to make consecutive monthly payments of interest on any outstanding principal calculated at a rate per annum equal to

4.25%.

The entire principal balance, plus all accrued interest, is due in full on the Maturity Date. As of

March 31, 2020,

there were

no

amounts due under the Change of Terms Agreement.

Proceeds from the Key Bank Revolver Note, at the discretion of the Bank, provide for the Company to borrow up to

$1,000,000

for working capital and general corporate purposes. 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

one

-day LIBOR (adjusted daily) 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. As of

March 31, 2020,

there were

no

amounts due under the Key Bank Revolver Note.

Proceeds from the Key Bank Term Note were utilized to retire amounts previously outstanding under a

$280,920

term loan from PNC Bank. As of

March 31, 2020,

all amounts outstanding under the Key Bank Term Note have been repaid.

The Company is party to a Concession Agreement, dated as of

November 1, 2008,

with the City of New York for the operation of the Downtown Manhattan Heliport (the “Concession Agreement”). Pursuant to the terms of the Concession Agreement, the Company must pay the greater of

18%

of the

first

$5,000,000

in any program year based on cash collected (“Gross Receipts”) and

25%

of Gross Receipts in excess of

$5,000,000,

or minimum annual guaranteed payments. During the

three

months ended

March 31, 2020

and

2019,

we incurred approximately

$254,000

and

$337,000

in concession fees, respectively, which are recorded in the cost of revenue.

As disclosed in a Current Report on Form

8

-K filed with the SEC on

February 5, 2016,

the Company and the New York City Economic Development Corporation (the “NYCEDC”) announced new measures to reduce helicopter noise and impacts across New York City (the “Air Tour Agreement”).

Under the Air Tour Agreement, filed as an exhibit to our Annual Report on Form

10

-K for the year ended

December 31, 2015,

the Company

may

not

allow its tenant operators to conduct tourist flights from the Downtown Manhattan Heliport on Sundays beginning

April 1, 2016.

The Company was also required to ensure that its tenant operators reduce the total allowable number of tourist flights from

2015

levels by

20

percent beginning

June 1, 2016,

by

40

percent beginning

October 1, 2016

and by

50

percent beginning

January 1, 2017.

Additionally, beginning on

June 1, 2016,

the Company was required to provide monthly written reports to the NYCEDC and the New York City Council detailing the number of tourist flights conducted out of the Downtown Manhattan Heliport compared to

2015

levels, as well as information on any tour flight that flies over land and/or strays from agreed upon routes.

The Air Tour Agreement also extended the Concession Agreement for

30

months, resulting in a new expiration date of

April 30, 2021.

The City of New York has

two one

-year options to further extend the Concession Agreement. The Air Tour Agreement also provides that the minimum annual guarantee payments the Company is required to pay to the City of New York under the Concession Agreement be reduced by

50%,

effective

January 1, 2017.

These reductions have negatively impacted the Company’s business and financial results as well as those of its management company at the Heliport, Empire Aviation which, as previously disclosed, is owned by the children of a former officer and director of the Company.  The Company incurred management fees with Empire Aviation of approximately

$86,000

and

$248,000

during the

three

months ended

March 31, 2020

and

2019,

respectively, which is recorded in administrative expenses. The Company and Empire Aviation have also contributed to the Helicopter Tourism and Jobs Council (“HTJC”), an association that lobbies on behalf of the helicopter air tour industry, and which had engaged in discussions with the Mayor’s office.  The Company’s former officer and director is also an active participant with HJTC, which is managed by the former officer and director’s grandson. One of our Directors, Sam Goldstein, serves as deputy director of HJTC.  

On

April 20, 2018,

the Company’s Kansas subsidiary entered into a purchase lease with Commerce Bank for a refueling truck (the “Truck Lease”). The Truck Lease commenced on

May 1, 2018

and continues for

60

months at an interest rate of LIBOR plus

416

basis points. At the end of the Truck Lease, the Company’s subsidiary

may

purchase the vehicle for

$1.00.

On

January 15, 2019,

the Company was issued an unsecured note by

one

of its customers at the Heliport. The note schedules payments of approximately

$276,000

in receivables payable by such customer, had a maturity date of

October 31, 2019,

as amended, and carries a

7.5%

rate of interest. The note payments were to be made in

six

monthly installments beginning

May 31, 2019.

The customer’s payments on the note have

not

met the installment plan and the Company was working on changes to the note when the customer filed for Chapter

11

Bankruptcy. The Company intends to pursue remaining amounts due under the note and it is the Company’s expectation that the note will be fulfilled.

As disclosed in a Current Report on Form

8

-K filed with the SEC on

July 6, 2015,

the Company entered into a stock purchase agreement, dated

June 30, 2015,

by and between the Company and Warren A. Peck, pursuant to which Mr. Peck purchased all of the capital stock of the Company’s wholly-owned subsidiary, Phoenix Rising Aviation, Inc. The details of the agreement are described in such Current Report as well as in the Company’s Annual Report on Form

10

-K for the year ended

December 31, 2015,

which was filed with the SEC on

April 11, 2016.

The Company received

$100,000

due under this agreement in

September 2017

and an additional payment of

$100,000

in

September 2018.

In

2019,

the Company accepted the title to a Falcon

10

aircraft owned by Mr. Peck as satisfaction in full of the remainder of the

$270,000

stock purchase price. The Company intends to sell the aircraft and has classified it as “Held For Sale” on the Company’s Consolidated Balance Sheets as of

March 31, 2020.

As described throughout this Quarterly Report on Form

10

-Q, on

March 17, 2020,

all sightseeing tour operations at the Downtown Manhattan Heliport ceased due to the drop in demand as a result of the COVID-

19

pandemic. To mitigate the loss of revenue due to the temporary suspension in operations, we

may

need additional financing to continue operations through the issuance of equity or debt and any such financing will be dependent on general market conditions, which itself is subject to the effects of the COVID-

19

pandemic. Although we have access to the Key Bank Revolver Note described above, we can make

no

assurance that that the Key Bank Revolver Note will be sufficient to fund our operations. Additionally, certain restrictions in the Key Bank Revolver Note

may

prohibit us from obtaining more attractive financing.

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Note 7 - Stockholders' Equity

3 Months Ended

Mar. 31, 2020

Notes to Financial Statements

Stockholders' Equity Note Disclosure [Text Block]

NOTE

7

-

Stockholders’ Equity

On

February 27, 2019,

the Company filed with the Secretary of State of the state of Nevada a certificate of amendment to its articles of incorporation. The amendment provided for a reverse stock split (the “Reverse Stock Split”) of the Company’s outstanding shares of common stock at a ratio of

1

-for-

30.

This amendment further provided for a reduction in the number of authorized shares of common stock to

3,333,334,

as well as for a reduction in the number of authorized shares of preferred stock to

333,306.

The amendment had an effective date and time of

12:01

a.m. Eastern Time on

March 1, 2019

for stockholders of record on

February 27, 2019.

Accordingly, the Company presents historical share data in the condensed consolidated financial statements after giving effect to the Reverse Stock Split.

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Note 4 - Inventories (Tables)

3 Months Ended

Mar. 31, 2020

Notes Tables

Schedule of Inventory, Current [Table Text Block]

	March 31, 2020		December 31, 2019
Parts inventory	$	86,142	$	87,625
Fuel inventory		62,778		79,497
Other inventory		12,430		14,082
Total inventory	$	161,350	$	181,204

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Note 6 - Litigation

3 Months Ended

Mar. 31, 2020

Notes to Financial Statements

Legal Matters and Contingencies [Text Block]

NOTE

6

–

Litigation

From time to time, we

may

be a party to

one

or more claims or disputes which

may

result in litigation. However, we are currently

not

a party to, nor is our property subject to, any material pending legal proceedings.

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Note 3 - Summary of Significant Accounting Policies (Tables)

3 Months Ended

Mar. 31, 2020

Notes Tables

Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]

	For the Three Months Ended March 31,
	2020		2019
Weighted average common shares outstanding, basic		1,022,515		1,007,293
Common shares upon exercise of options		16,384		12,279
Weighted average common shares outstanding, diluted		1,038,899		1,019,572

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Note 3 - Summary of Significant Accounting Policies - Computation of Basic Net Income Per Share (Details) - shares	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Weighted average common shares outstanding, basic (in shares)	1,022,515	1,007,293
Common shares upon exercise of options (in shares)	16,384	12,279
Weighted average common shares outstanding, diluted (in shares)	1,038,899	1,019,572

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Note 3 - Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2020

Notes to Financial Statements

Significant Accounting Policies [Text Block]

NOTE

3

-

Summary of Significant Accounting Policies

Principles of Consolidation

The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, FirstFlight Heliports, LLC, and its fixed base operation and aircraft maintenance and repair services at Garden City (Kansas) Regional Airport. All significant inter-company accounts and transactions have been eliminated in consolidation.

Net

(Loss)

Income

Per Common Share

Net (loss) income was $(

96,140

) and

$52,336

for the

three

months ended

March 31, 2020

and

2019,

respectively. Basic net income per share applicable to common stockholders is computed based on the weighted average number of shares of the Company’s common stock outstanding during the periods presented. Diluted net income per share reflects the potential dilution that could occur if securities or other instruments to issue common stock were exercised or converted into common stock. Potentially dilutive securities, consisting of options and warrants, are excluded from the calculation of the diluted income per share when their exercise prices were greater than the average market price of the common stock during the period. 

The following table sets forth the components used in the computation of basic net income per share:

	For the Three Months Ended March 31,
	2020		2019
Weighted average common shares outstanding, basic		1,022,515		1,007,293
Common shares upon exercise of options		16,384		12,279
Weighted average common shares outstanding, diluted		1,038,899		1,019,572

Stock

-

Based Compensation

Stock-based compensation expense for all stock-based payment awards are based on the estimated grant-date fair value. The Company recognizes these compensation costs over the requisite service period of the award, which is generally the option vesting term. For the

three

months ended

March 31, 2020

and

2019,

the Company incurred stock-based compensation of

$18,651

and

$8,500,

respectively. Such amounts have been recorded as part of the Company’s selling, general and administrative expenses in the accompanying consolidated statements of operations. As of

March 31, 2020,

the unamortized fair value of the options totaled

$56,009

and the weighted average remaining amortization period of the options approximated

five

years.

Option valuation models require the input of highly subjective assumptions, including the expected life of the option. Because the Company's employee stock options have characteristics significantly different from those of traded options, and because changes in the subjective input assumptions can materially affect the fair value estimate, in management's opinion, the existing models do

not

necessarily provide a reliable single measure of the fair value of its employee stock options.

Recently Adopted Accounting Pronouncements

In

February 2016,

the FASB issued ASU

No.

2016

-

02,

“Leases” (“ASU

2016

-

02”

), which requires an entity to recognize assets and liabilities on the balance sheet for the rights and obligations created by leased assets and provide additional disclosures. ASU

2016

-

02

became effective for us on

January 1, 2019

and we have adopted the new standard using a modified retrospective approach. The adoption of ASU

No.

2016

-

02

did

not

have a material impact on the Company’s financial statements.

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Note 8 - Dividend Payable (Details Textual) - $ / shares	Sep. 30, 2019	Nov. 01, 2019
Common Stock, Dividends, Per Share, Declared (in dollars per share)	$ 0.50
Dividends, Per Share to be Paid in Equal Quarterly Installments (in dollars per share)		$ 0.125

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Document And Entity Information - shares	3 Months Ended
	Mar. 31, 2020	May 15, 2020
Document Information [Line Items]
Entity Registrant Name	Saker Aviation Services, Inc.
Entity Central Index Key	0001128281
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Current Reporting Status	Yes
Entity Emerging Growth Company	false
Entity Small Business	true
Entity Interactive Data Current	Yes
Entity Common Stock, Shares Outstanding (in shares)		1,023,744
Entity Shell Company	false
Document Type	10-Q
Document Period End Date	Mar. 31, 2020
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q1
Amendment Flag	false

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Statements of Stockholders' Equity (Unaudited) - USD ($)	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Total
Balance (in shares) at Dec. 31, 2018	1,006,768
Balance at Dec. 31, 2018	$ 30,203	$ 19,756,839	$ (14,440,541)	$ 5,346,501
Issuance of additional Common Stock in connection with reverse split (in shares)	525
Issuance of additional Common Stock in connection with reverse split	$ 16	16		0
Amortization of stock based compensation		8,500
Net (loss) income			52,336	52,336
Balance (in shares) at Mar. 31, 2019	1,007,293
Balance at Mar. 31, 2019	$ 30,219	19,765,323	(14,388,205)	5,407,337
Balance (in shares) at Dec. 31, 2019	1,020,135
Balance at Dec. 31, 2019	$ 30,604	19,818,637	(14,272,897)	5,576,344
Amortization of stock based compensation		18,651		18,651
Net (loss) income			(96,140)	(96,140)
Issuance of additional Common Stock (in shares)	3,609
Issuance of additional Common Stock	$ 108	108		0
Balance (in shares) at Mar. 31, 2020	1,023,744
Balance at Mar. 31, 2020	$ 30,712	$ 19,837,180	$ (14,369,037)	$ 5,498,855

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Note 2 - Liquidity and Material Agreements (Details Textual) - USD ($)				1 Months Ended		3 Months Ended		9 Months Ended	12 Months Ended
	Oct. 11, 2018	Jan. 01, 2017	Nov. 01, 2008	Sep. 30, 2018	Sep. 30, 2017	Mar. 31, 2020	Mar. 31, 2019	Sep. 15, 2018	Dec. 31, 2015	Dec. 31, 2019	Sep. 30, 2019	Jan. 15, 2019	Dec. 31, 2018	Apr. 20, 2018	Mar. 15, 2018	May 17, 2013
Cash and Cash Equivalents, at Carrying Value, Ending Balance						$ 3,143,675	$ 2,951,197			$ 3,597,491			$ 2,838,649
Working Capital						3,868,871
Revenue from Contract with Customer, Including Assessed Tax						1,673,755	2,072,772
Net Income (Loss) Attributable to Parent, Total						(96,140)	52,336
Net Cash Provided by (Used in) Operating Activities, Total						(310,882)	243,051
Net Cash Provided by (Used in) Investing Activities, Total						(4,912)	(42,128)
Net Cash Provided by (Used in) Financing Activities, Total						(138,022)	(88,375)
Environmental Remediation, Agreed Percentage of Reduction in Tenant Operated Tourist Flights									20.00%
Environmental Remediation, Agreed Percentage of Reduction in Tenant Operated Tourist Flights by Year One									40.00%
Environmental Remediation, Agreed Percentage of Reduction in Tenant Operated Tourist Flights by Year Two									50.00%
General and Administrative Expense, Total						86,000	248,000
Financing Receivable, after Allowance for Credit Loss, Total												$ 276,000
Financing Receivable, Interest Rate												7.50%
Financing Receivable, after Allowance for Credit Loss, Current, Total						188,828				$ 188,828
Warren A. Peck [Member]
Proceeds from Collection of Notes Receivable				$ 100,000	$ 100,000
Financing Receivable, after Allowance for Credit Loss, Current, Total											$ 270,000
Truck Lease [Member]
Lessee, Finance Lease, Term of Contract (Month)														5 years
Capital Lease, Lessee, Purchase Price of Capital Leased Asset														$ 1
Concession Agreement [Member]
Percentage Payable Greater than Gross Receipts During Period			18.00%
Amount of Gross Receipts During Period			$ 5,000,000
Percentage Payable Greater than Gross Receipts in Year One			25.00%
Concession Fees						254,000	$ 337,000
Line of Credit Facility, Payment Term (Month)									2 years 180 days
Line of Credit Facility, Number of Options to Extend Agreement									2
Minimum Annual Guarantee Percent		50.00%
London Interbank Offered Rate (LIBOR) [Member] | Truck Lease [Member]
Capital Leases of Lessee, Contingent Rentals, Basis Spread on Variable Rate														4.16%
Key Bank National Association [Member] | Term Loan [Member]
Debt Instrument, Face Amount															$ 338,481
PNC Bank [Member] | Term Loan [Member]
Extinguishment of Debt, Amount						280,920
Acquisition Line of Credit [Member] | Key Bank National Association [Member]
Line of Credit Facility, Maximum Borrowing Capacity															2,500,000
Debt Instrument, Term (Month)								4 years
Debt Instrument, Periodic Payment, Total						$ 0
Acquisition Line of Credit [Member] | Key Bank National Association [Member] | London Interbank Offered Rate (LIBOR) [Member]
Debt Instrument, Basis Spread on Variable Rate								2.75%
Acquisition Line of Credit [Member] | Key Bank National Association [Member] | Cost of Funds Rate [Member]
Debt Instrument, Basis Spread on Variable Rate						2.50%
Working Capital Line of Credit [Member] | Key Bank National Association [Member]
Line of Credit Facility, Maximum Borrowing Capacity															$ 1,000,000
Debt Instrument, Periodic Payment, Total						$ 0
Working Capital Line of Credit [Member] | Key Bank National Association [Member] | London Interbank Offered Rate (LIBOR) [Member]
Debt Instrument, Basis Spread on Variable Rate						2.75%
PNC Acquisition Line [Member]
Line of Credit Facility, Maximum Borrowing Capacity																$ 2,500,000
Change of Terms Agreement [Member] | Key Bank National Association [Member]
Line of Credit Facility, Maximum Borrowing Capacity	$ 2,500,000
Debt Instrument, Periodic Payment, Total						$ 0
Change of Terms Agreement [Member] | Key Bank National Association [Member] | London Interbank Offered Rate (LIBOR) [Member]
Debt Instrument, Basis Spread on Variable Rate	4.25%

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Note 4 - Inventories

3 Months Ended

Mar. 31, 2020

Notes to Financial Statements

Inventory Disclosure [Text Block]

NOTE

4

–

Inventories

Inventory consists primarily of aviation fuel, which the Company dispenses to its customers, and parts inventory as a result of the acquisition of Aircraft Services, Inc. The Company also maintains fuel inventories for commercial airlines, to which it charges into-plane fees when servicing commercial aircraft.

Inventories consist of the following:

	March 31, 2020		December 31, 2019
Parts inventory	$	86,142	$	87,625
Fuel inventory		62,778		79,497
Other inventory		12,430		14,082
Total inventory	$	161,350	$	181,204

Included in fuel inventory are amounts held for

third

parties of

$38,125

and

$25,804

as of

March 31, 2020

and

December 31, 2019,

respectively, with an offsetting liability included as part of accrued expenses.

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Note 8 - Dividend Payable

3 Months Ended

Mar. 31, 2020

Notes to Financial Statements

Dividends Payable Disclosures [Text Block]

NOTE

8

–

Dividend Payable

On

September 30, 2019,

the Company announced that its Board of Directors had declared a special cash dividend of

$0.50

per share (the “Dividend”). The Dividend is being paid in equal quarterly installments of

$0.125

per share which began on

November 1, 2019,

with the final dividend scheduled to be paid on

August 28, 2020.

The total amount of future cash dividends to be paid has been accrued in the Company’s consolidated balance sheets as of

March 31, 2020.

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Note 4 - Inventories - Summary of Inventory (Details) - USD ($)	Mar. 31, 2020	Dec. 31, 2019
Inventories	$ 161,350	$ 181,204
Parts [Member]
Inventories	86,142	87,625
Fuel [Member]
Inventories	62,778	79,497
Other Inventory [Member]
Inventories	$ 12,430	$ 14,082

XML

Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - USD ($)	Mar. 31, 2020	Dec. 31, 2019
Property and equipment, accumulated depreciation	$ 3,696,006	$ 3,676,488
Preferred stock, par value (in dollars per share)	$ 0.03	$ 0.03
Preferred stock, shares authorized (in shares)	333,306	333,306
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.03	$ 0.03
Common stock, shares authorized (in shares)	3,333,334	3,333,334
Common stock, shares issued (in shares)	1,023,744	1,020,135
Common stock, shares outstanding (in shares)	1,023,744	1,020,135

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Note 1 - Basis of Presentation

3 Months Ended

Mar. 31, 2020

Notes to Financial Statements

Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

NOTE

1

-

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of Saker Aviation Services, Inc. (the “Company”) and its subsidiaries have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial statements and in accordance with the instructions to Form

10

-Q. Accordingly, they do

not

include all of the information and disclosures required by GAAP for annual financial statements and should be read in conjunction with the financial statements and related footnotes included in the Company’s Annual Report on Form

10

-K for the year ended

December 31, 2019.

The condensed consolidated balance sheet as of

March 31, 2020

and the condensed consolidated statements of operations and cash flows for the

three

months ended

March 31, 2020

and

2019

have been prepared by the Company without audit. In the opinion of the Company’s management, all necessary adjustments (consisting of normal recurring accruals) have been included to make the Company’s financial position as of

March 31, 2020

and its results of operations and cash flows for the

three

months ended

March 31, 2020

not

misleading. The results of operations for the

three

months ended

March 31, 2020

are

not

necessarily indicative of the results to be expected for any full year or any other interim period.

Since

December 2019,

the novel coronavirus (“COVID-

19”

) has spread to many countries and the World Health Organization has declared COVID-

19

a pandemic. Federal, state, and local governments have implemented certain travel restrictions, “stay-at-home” orders, and social distancing initiatives which have negatively impacted our operations. As a result of the ongoing COVID-

19

pandemic, as of

March 17, 2020

all sightseeing tour operations at the Downtown Manhattan Heliport ceased due to a drop in demand. The extent of the impact of the COVID-

19

pandemic on our operational and financial performance will depend on future developments, including the duration and spread of the COVID-

19

pandemic and related travel advisories and restrictions, and the impact of the COVID-

19

pandemic on overall demand for air travel, all of which are highly uncertain and cannot be predicted. Based on the impact that the COVID-

19

pandemic has already had on our business, we expect to experience a decrease in revenue for the fiscal year ending

December 31, 2020

relative to prior year periods.

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Consolidated Balance Sheets (Current Period Unaudited) - USD ($)	Mar. 31, 2020	Dec. 31, 2019
CURRENT ASSETS
Cash	$ 3,143,675	$ 3,597,491
Accounts receivable	552,171	678,045
Inventories	161,350	181,204
Notes receivable	188,828	188,828
Held for sale assets	270,000	270,000
Prepaid expenses and other current assets	196,586	294,644
Total current assets	4,512,610	5,210,212
PROPERTY AND EQUIPMENT, net of accumulated depreciation and amortization of $3,696,006 and $3,676,488 as of March 31, 2020 and December 31, 2019, respectively	308,710	323,316
OTHER ASSETS
Deposits	2,512	2,512
Right of use assets	482,088	495,377
Goodwill	750,000	750,000
Deferred income taxes	476,000	476,000
Total other assets	1,710,600	1,723,889
TOTAL ASSETS	6,531,920	7,257,417
CURRENT LIABILITIES
Accounts payable	27,322	397,343
Customer deposits	130,821	130,395
Accrued dividends payable	245,402	373,370
Accrued expenses	179,166	319,557
Right of use leases payable – current portion	61,028	60,675
Total current liabilities	643,739	1,281,340
LONG-TERM LIABILITIES
Right of use leases payable - less current portion	389,326	399,733
Total liabilities	1,033,065	1,681,073
STOCKHOLDERS’ EQUITY
Preferred stock - $0.03 par value; authorized 333,306; none issued and outstanding
Common stock - $0.03 par value; authorized 3,333,334; 1,023,744 and 1,020,135 shares issued and outstanding as of March 31, 2020 and December 31, 2019, respectively	30,712	30,604
Additional paid-in capital	19,837,180	19,818,637
Accumulated deficit	(14,369,037)	(14,272,897)
TOTAL STOCKHOLDERS’ EQUITY	5,498,855	5,576,344
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$ 6,531,920	$ 7,257,417

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Consolidated Statements of Cash Flows (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) income	$ (96,140)	$ 52,336
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization	32,807	21,818
Stock based compensation	18,651	8,500
Changes in operating assets and liabilities:
Accounts receivable, trade	125,874	30,614
Inventories	19,854	(19,727)
Prepaid expenses and other current assets	98,058	112,487
Customer deposits	426	1,861
Accounts payable	(370,021)	20,281
Accrued expenses	(140,391)	14,881
TOTAL ADJUSTMENTS	(214,742)	190,715
NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES	(310,882)	243,051
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment	(4,912)	(42,128)
NET CASH USED IN INVESTING ACTIVITIES	(4,912)	(42,128)
CASH FLOWS FROM FINANCING ACTIVITIES
Dividends paid	(127,968)
Repayment of right of use leases payable	(10,054)	(6,147)
Repayment of notes payable		(82,228)
NET CASH USED IN FINANCING ACTIVITIES	(138,022)	(88,375)
NET CHANGE IN CASH	(453,816)	112,548
CASH – Beginning	3,597,491	2,838,649
CASH – Ending	3,143,675	2,951,197
NON-CASH OPERATING AND INVESTING ACTIVITIES:
Change in Accounts Receivable through issuance of a Note Receivable		276,036
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Interest	1,229	2,651
Income taxes	$ 28,079

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Note 7 - Stockholders' Equity (Details Textual)	Feb. 27, 2019 shares	Mar. 31, 2020 shares	Dec. 31, 2019 shares
Common Stock, Shares Authorized (in shares)	3,333,334	3,333,334	3,333,334
Preferred Stock, Shares Authorized (in shares)	333,306	333,306	333,306
Reverse Stock Split [Member]
Stockholders' Equity Note, Stock Split, Conversion Ratio	30

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Note 5 - Related Parties

3 Months Ended

Mar. 31, 2020

Notes to Financial Statements

Related Party Transactions Disclosure [Text Block]

NOTE

5

–

Related Parties

From time to time, the law firm of Wachtel Missry, LLP provides certain legal services to the Company and its subsidiaries. William B. Wachtel, Chairman of the Company’s Board of Directors, is a managing partner of such firm. During the

three

months ended

March 31, 2020,

no

services were provided to the Company by Wachtel & Missry, LLP.

As described in more detail in Note

2,

Liquidity and Material Agreements, the Company is party to a management agreement with Empire Aviation, an entity owned by the children of the Company’s former Chief Executive Officer and a former member of our Company’s Board of Directors.

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Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2020

Accounting Policies [Abstract]

Consolidation, Policy [Policy Text Block]

Principles of Consolidation

The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, FirstFlight Heliports, LLC, and its fixed base operation and aircraft maintenance and repair services at Garden City (Kansas) Regional Airport. All significant inter-company accounts and transactions have been eliminated in consolidation.

Earnings Per Share, Policy [Policy Text Block]

Net

(Loss)

Income

Per Common Share

Net (loss) income was $(

96,140

) and

$52,336

for the

three

months ended

March 31, 2020

and

2019,

respectively. Basic net income per share applicable to common stockholders is computed based on the weighted average number of shares of the Company’s common stock outstanding during the periods presented. Diluted net income per share reflects the potential dilution that could occur if securities or other instruments to issue common stock were exercised or converted into common stock. Potentially dilutive securities, consisting of options and warrants, are excluded from the calculation of the diluted income per share when their exercise prices were greater than the average market price of the common stock during the period. 

The following table sets forth the components used in the computation of basic net income per share:

	For the Three Months Ended March 31,
	2020		2019
Weighted average common shares outstanding, basic		1,022,515		1,007,293
Common shares upon exercise of options		16,384		12,279
Weighted average common shares outstanding, diluted		1,038,899		1,019,572

Share-based Payment Arrangement [Policy Text Block]

Stock

-

Based Compensation

Stock-based compensation expense for all stock-based payment awards are based on the estimated grant-date fair value. The Company recognizes these compensation costs over the requisite service period of the award, which is generally the option vesting term. For the

three

months ended

March 31, 2020

and

2019,

the Company incurred stock-based compensation of

$18,651

and

$8,500,

respectively. Such amounts have been recorded as part of the Company’s selling, general and administrative expenses in the accompanying consolidated statements of operations. As of

March 31, 2020,

the unamortized fair value of the options totaled

$56,009

and the weighted average remaining amortization period of the options approximated

five

years.

Option valuation models require the input of highly subjective assumptions, including the expected life of the option. Because the Company's employee stock options have characteristics significantly different from those of traded options, and because changes in the subjective input assumptions can materially affect the fair value estimate, in management's opinion, the existing models do

not

necessarily provide a reliable single measure of the fair value of its employee stock options.

New Accounting Pronouncements, Policy [Policy Text Block]

Recently Adopted Accounting Pronouncements

In

February 2016,

the FASB issued ASU

No.

2016

-

02,

“Leases” (“ASU

2016

-

02”

), which requires an entity to recognize assets and liabilities on the balance sheet for the rights and obligations created by leased assets and provide additional disclosures. ASU

2016

-

02

became effective for us on

January 1, 2019

and we have adopted the new standard using a modified retrospective approach. The adoption of ASU

No.

2016

-

02

did

not

have a material impact on the Company’s financial statements.

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Note 3 - Summary of Significant Accounting Policies (Details Textual) - USD ($)	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Net Income (Loss) Attributable to Parent, Total	$ (96,140)	$ 52,336
Share-based Payment Arrangement, Noncash Expense, Total	18,651	$ 8,500
Shares Based Compensation, Stock Options Unamortized Fair Value	$ 56,009