Company Delivers Record Revenue, Positive EBITDA and Net Income
CALGARY, AB / ACCESSWIRE / November 9, 2022 / FLYHT Aerospace Solutions Ltd. (TSXV:FLY)(OTCQX:FLYLF) (the "Company" or "FLYHT") today reported financial results for the third quarter ended September 30, 2022 ("Q3 2022"). All figures are Canadian dollars unless otherwise stated.
Three Months Ended Sept. 30
Nine Months Ended Sept. 30
Net Income (Loss)
EPS - Basic & Diluted
"FLYHT delivered its strongest quarter in years in Q3 2022, demonstrating that the aviation industry is finally waking up to our solutions as it shifts focus from cost savings to improving efficiency and profitability," said Bill Tempany, Interim CEO. "We generated record revenue along with positive EDITDA and positive Net Income. Revenue was $6.7 million, up 112% over last year, driven by continued SaaS growth and fulfilling on the purchase order of modems from our long-time OEM partner. EBITDA was $925k, the first positive quarter since the COVID-19 pandemic."
Continued Tempany, "The AFIRSTM Edge is on the verge of being a qualified product which should set the stage for large scale commercialization in 2023. We are in the final stages of lab testing before the device gets in the air for additional testing at altitude, and development on the A320 and B737 Supplemental Type Certificates (STC's) is well underway. We are currently working on multiple large-scale requests for proposals (RFPs) for several major industry players. With the only device coming to market capable of 3G/4G/5G transmission as 3G sunsets across the globe, we believe we are in a strong position to pursue a meaningful share of the 25,000 aircraft that require these data services. This opportunity would be transformational for us."
Concluded Tempany, "With the expected certification of the AFIRS Edge around the corner, I couldn't be more excited about what's in store for FLYHT. We look forward to finishing out the year with strong performance and then building on our momentum into 2023 and beyond."
Revenue increased by 112% to $6,725,373 in Q3 2022 compared to Q3 2021, driven by growth in SaaS, Licensing and Technical Services.
SaaS revenue increased by 37.5% to $2,073,284 in Q3 2022. The addition of CrossConsense SaaS revenues more than offset a decrease of 2.2% in AFIRS SaaS revenues resulting from a drop in customers' flight hours and active aircraft in some geographies. Licensing revenue increased by 252% to $3,536,153 due to increases in the number of modems and associated license fees ordered for delivery in comparative periods, as the Company began delivering on an order received in mid-Q2 2022 for US$5.65 million. Technical Services revenue increased by 577.1% to $635,872 with contributions from CrossConsense services offsetting a decrease of 15.2% from traditional services. Hardware revenue decreased by 15.4% to $480,064 offsetting a portion of the large increases in hardware shipments seen in Q1 2022. A total of 53 installation kits were shipped YTD 2022 compared with 45 shipped YTD 2021.
Gross margin was 72.4% of revenue in Q3 2022 compared to 68.2% in Q3 2021. The increase in gross margin was due primarily to changes in the mix of revenue sources during the quarter.
Operating expenses increased by 29% from Q3 2021, driven by a 53% increase in Distribution expenses and a 52% increase in Administration expenses. Research and Development and certification engineering expenses decreased by 2% compared to Q3 2021. These increases were largely driven by the addition of personnel and expenses associated with the March 2022 acquisition of CrossConsense.
Positive EBITDA1 totaled $924,680 in Q3 2022 compared to an EBITDA loss of $811,966 in Q3 2021.
Net Income was $703,765 in Q3 2022 compared to a Net loss of $1,107,195 in Q3 2021.
Balance Sheet and Liquidity
Cash and short-term investments were $1,779,074 at September 30, 2022, compared to $4,520,591 at December 31, 2021.
Trade and other receivables increased by 157% to $4,090,042 compared to YE 2021, and Trade payables and accrued liabilities increased by 56% to $2,652,525 compared to YE 2021. The increased sales in Q3 2022 and associated costs resulted in an increase in both the receivables and payables balances.
Conference Call Information
FLYHT will host a conference call to discuss its financial results for Q3 2022 on Thursday, November 10, 2022, at 7:30 a.m. MT (9:30 a.m. ET). The conference call will include a brief presentation from FLYHT's Interim CEO Bill Tempany and CFO Alana Forbes followed by a question-and-answer session. To access the conference call by phone within Canada and the U.S., the toll-free number is 1-800-319-4610. Outside Canada and the U.S., dial 1-604-638-5340.
Management will accept questions by telephone and e-mail. Individuals wishing to ask a question during the call can do so by pressing *1. Questions can be emailed in advance or during the conference call email@example.com. An archive of the conference call will be posted on the Investor Communications section of FLYHT's website following the meeting.
FLYHT's Q3 2022 Report, which contains more detailed information including the CEO's Letter to Shareholders, Management Discussion and Analysis and Financial Statements, can be accessed on the Company's website. The MD&A and Financial Statements have also been filed with SEDAR and will be accessible at www.sedar.com.
About FLYHT Aerospace Solutions Ltd.
FLYHT provides airlines with Actionable Intelligence to transform operational insight into immediate, quantifiable action, and delivers industry leading solutions to improve aviation safety, efficiency, and profitability. This unique capability is driven by a suite of patented aircraft certified hardware products. These include AFIRS™, an aircraft satcom/interface device, which enables cockpit voice communications, real-time aircraft state analysis, and the transmission of aircraft data while inflight. The AFIRS Edge is a state-of-the-art 5G Wireless Quick Access Recorder (WQAR), Aircraft Interface Device (AID), and Aircraft Condition and Monitoring System (ACMS). The Edge can be interfaced with FLYHT's TAMDAR probe or the FLYHT-WVSS-II relative humidity sensor to deliver airborne weather and humidity data in real-time.
CrossConsense, FLYHT's wholly-owned subsidiary, offers highly skilled services to the commercial aviation industry and provides preventative maintenance solutions. These include Aircraft Fleet View, a native application that gives a real-time view of airline fleet status; AviationDW, a managed data warehouse for enhanced business intelligence; and ACSIS, a visualization and predictive maintenance alerting tool.
FLYHT is headquartered in Calgary, Canada, and is an AS9100 Quality registered company. CrossConsense, located in Frankfurt, Germany, is an ISO9001 certified operation. For more information, visit www.flyht.com.
Cautionary Note Regarding Forward-Looking Statements
Except for statements of historical fact, this news release contains certain "forward-looking information" within the meaning of applicable securities law. Forward-looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur. In particular, forward-looking information in this press release includes, but is not limited to, statements with respect to the anticipated/projected revenues and related matters. Although we believe that the expectations reflected in the forward-looking information are reasonable, there can be no assurance that such expectations will prove to be correct. We cannot guarantee future results, performance or achievements. Consequently, there is no representation that the actual results achieved will be the same, in whole or in part, as those set out in the forward-looking information.
Forward-looking information is based on the opinions and estimates of management at the date the statements are made and are founded on the basis of expectations, assumptions and hypotheses made by the Company, including, but not limited to projected revenues. Such forward-looking information is subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking information. Some of the risks and other factors that could cause the results to differ materially from those expressed in the forward-looking information include, but are not limited to: general economic conditions in Canada, the United States and globally; industry conditions, and supply chain delays. Readers are cautioned that this list of risk factors should not be construed as exhaustive.
The forward-looking information contained in this news release is expressly qualified by this cautionary statement. We undertake no duty to update any of the forward-looking information to conform such information to actual results or to changes in our expectations except as otherwise required by applicable securities legislation. Readers are cautioned not to place undue reliance on forward-looking information.
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1 EBITDA: defined as earnings before interest, income tax, depreciation and amortization (a non-GAAP financial measure). EBITDA is provided to aid in analysis and profitability comparisons among companies and industries, by segregating operating results from the effects of financing and capital expenditures.
SOURCE: FLYHT Aerospace Solutions Ltd.
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