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FLYHT February 2018 Investor Presentation

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FLYHT's latest slide deck with updates on our progress, business and financials.

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FLYHT February 2018 Investor Presentation

  1. 1. February 2018 FLYHT Aerospace Solutions Ltd. TSX.V: FLY OTCQX: FLYLF
  2. 2. 2TSX.V: FLY OTCQX: FLYLF Feb 2018 Forward Looking Statements This discussion includes certain statements that may be deemed “forward-looking statements” that are subject to risks and uncertainty. All statements, other than statements of historical facts included in this discussion, including, without limitation, those regarding the Company’s financial position, business strategy, projected costs, future plans, projected revenues, objectives of management for future operations, the Company’s ability to meet any repayment obligations, the use of non-GAAP financial measures, trends in the airline industry, the global financial outlook, expanding markets, research and development of next generation products and any government assistance in financing such developments, foreign exchange rate outlooks, new revenue streams and sales projections, cost increases as related to marketing, research and development (including AFIRS 228), administration expenses, and litigation matters, may be or include forward-looking statements. Although the Company believes the expectations expressed in such forward-looking statements are based on a number of reasonable assumptions regarding the Canadian, U.S., and global economic environments, local and foreign government policies/regulations and actions and assumptions made based upon discussions to date with the Company’s customers and advisers, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in the forward-looking statements include production rates, timing for product deliveries and installations, Canadian, U.S., and foreign government activities, volatility of the aviation market for the Company’s products and services, factors that result in significant and prolonged disruption of air travel worldwide, U.S. military activity, market prices, foreign exchange rates, continued availability of capital and financing and general economic, market, or business conditions in the aviation industry, worldwide political stability or any effect those may have on our customer base. Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in the forward-looking statements. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to have been correct. The Company cannot assure investors that actual results will be consistent with any forward-looking statements; accordingly, readers should not place undue reliance on forward-looking statements. The forward-looking statements contained herein are current only as of the date of this document. The Company disclaims any intentions or obligation to update or revise any forward-looking statements or comments as a result of any new information, future event or otherwise, unless such disclosure is required by law. www.flyht.com Disclaimer
  3. 3. 3TSX.V: FLY OTCQX: FLYLF Feb 2018 • Canadian Public Company (~$50M Market Cap) • Calgary, Alberta • TSX Venture: FLY • OTCQX: FLYLF • Leading provider of real-time data streaming technology that enhances the efficiency and safety of aircraft • Saves aircraft operators money • Helps streamline their operations • Proactively enhances safety, which help to prevent accidents and save lives • FLYHT technology • Airborne - Automated Flight Information Reporting System (AFIRSTM) • Ground Server - UpTimeTM Cloud Service Platform • FLYHT is a rapidly growing, “company to watch” in the aviation technology space Who is FLYHT?
  4. 4. 4TSX.V: FLY OTCQX: FLYLF Feb 2018 • Enhanced management & BOD with industry veterans • Factory option on Airbus A320, A330 and Bombardier CRJ • Other platforms in process • Over 1,900 shipments and growing rapidly • Over 70 Airline customers…and growing • Major success in China, fastest growing market • Cultivated a significant sales backlog (> $27M) • Supplemental Type Certificates (> 80 STC) • Barrier to Entry • Right to install • Most extensive Satcom catalogue in world • Qualified on 95% of commercial aircraft types FLYHT Overview Automated Flight Information Reporting System - AFIRSTM
  5. 5. 5TSX.V: FLY OTCQX: FLYLF Feb 2018 • Civil Aviation Administration of China (CAAC) legislated standards for state of the art aircraft communications • Chinese SATCOM Voice Regulation • Between Airline Operations Center (AOC) and Aircraft • Within 4 minutes, while in Chinese airspace • Original deadline was December, 2017 • New deadline is December, 2019 via CCAR 121 R5 • FLYHT provides outstanding solution for China through its AFIRS product Industry Drivers – China
  6. 6. 6TSX.V: FLY OTCQX: FLYLF Feb 2018 • International Civil Aviation Organization (ICAO – United Nations Body) • Adopted new amendments to Annex 6 (Operation of Aircraft) • Takes effect between now and 2021 • Amendment 39 • Applicable November 1, 2018 • Normal Aircraft Tracking – 15 minute interval • Amendment 40 • Newly manufactured aircraft from January 1, 2021 • Autonomous Distress Tracking (ADT) • 1 minute interval tracks • Distress circumstances • Timely Access to Flight Recorder Data • Flight recorder data recovered and made available in a timely manner. • FLY has active R&D program and trials with Boeing and Inmarsat targeting the above two amendments Industry Drivers – Global
  7. 7. 7TSX.V: FLY OTCQX: FLYLF Feb 2018 • Individual flight trials with Boeing and Inmarsat expected to strengthen FLYHT’s relationships with them • Boeing trial: FLYHT’s AFIRSTM and UpTimeTM Cloud used for FedEx B777 flight test for Boeing’s ecoDemonstrator Program, streaming data on both Iridium and Inmarsat (1Q 2018) • Inmarsat trial: FLYHT’s AFIRS to send data to UpTime Cloud via Inmarsat’s new IP broadband platform, to test Inmarsat’s “Black Box in the Cloud” capability (TBD 2018) • Both flight trials to demonstrate capabilities for Autonomous Distress Tracking and Timely Recovery of Flight Data Recent Successes: Boeing & Inmarsat
  8. 8. 8TSX.V: FLY OTCQX: FLYLF Feb 2018 • Selected for Boeing ecoDemonstrator Program and Inmarsat Trial • USD $2.1 million contract signed with Azur Aviation in Turkey – Q4, 2017 • Booked USD $16.9 million in sales in 2017 • YTD (Q3): • Revenue of $10.4 million; +2% vs. YTD16 • Voice and Data Services revenue up 1% over YTD16 • Parts revenue up 5% over YTD16 • 2016 revenue record $14.3 million • 2016 EBITDA positive at $2.5 million Recent Successes
  9. 9. 9TSX.V: FLY OTCQX: FLYLF Feb 2018 • Multiple revenue streams • Initial hardware sales with gross margin of 40-60% • Robust SAAS recurring revenue gross margins of 70-85% • Licensing arrangement with OEM of close to 100% margin • A la carte collection of SAAS products • Five-year customer contracts • Simple pricing, per aircraft per month with bundled airtime • 100% retention for going concerns • Greater than 2.9 million flight hours and 1.9 million flights using AFIRS • Certified on 95% of all aircraft used for commercial air transport • Agreements in place with two global OEMs • Major growth of sales in China – 23 airline customers • Signed 4 new airlines in 2017; 8 airlines in 2016 • Launched real-time data services in China! Three users • Significant remaining opportunity in sales funnel Investment Highlights
  10. 10. 10TSX.V: FLY OTCQX: FLYLF Feb 2018 AFIRSTM – More Than Just Tracking
  11. 11. 11TSX.V: FLY OTCQX: FLYLF Feb 2018 Iridium SATCOM Enhanced Global Flight Tracking Aircraft Health Monitoring FDR Streaming Fuel Management FLYHTVoice FLYHTMail ACARS over Iridium FLYHTLog FLYHTASD FLYHTHealth FLYHTStream FLYHTFuel AFIRS & UpTime Core Products Where FLYHT Competes Unique, Value-Added Services FLYHT Upsells • Saves aircraft operators money • Streamlines their operations • Enhances operational safety • “Bread and Butter” Products
  12. 12. 12TSX.V: FLY OTCQX: FLYLF Feb 2018 • Timely access to Flight Data Recorder (FDR) Information • Leading the industry with real-time FDR (black box) streaming technology • Technology raises the standard of tracking and automated alerting • Customizable triggers for streaming, frequency of flight following reports and selectable data that is streamed to the ground Patented, Real-time Data Streaming
  13. 13. 13TSX.V: FLY OTCQX: FLYLF Feb 2018 FLYHTASD – Aircraft Situational Display
  14. 14. 14TSX.V: FLY OTCQX: FLYLF Feb 2018 AFIRS alerted an airline customer to a high engine vibration • Customer was able to take the aircraft out of service to diagnose and fix the issue • The replacement cost for the engine: $5.2 million • The repair cost based on AFIRS-driven data: $780 thousand • Savings: Over $4 Million FLYHT created geo-fencing in its software to alert an airline customer when the aircraft entered or exited specific boundaries • Kept all parties advised, in real time, on the progress of each flight • Improved customer satisfaction • Reduced costs for the airline associated with poor communication and logistical support issues FLYHT provided data to satisfy a customer’s lease agreement • The customer had a requirement to conduct 10% of takeoffs at reduced thrust • Using AFIRS, the customer was able to monitor the parameters of operations and create real-time reports • Savings of hundreds of thousands of dollars in lease penalties Example Customer Success Stories
  15. 15. 15TSX.V: FLY OTCQX: FLYLF Feb 2018 AFIRS - Competitive Advantages Feature FLYHT Other Satcom OEM Tracking Solutions QAR/Health Monitoring Global Voice Coms X X X FANS/Safety Services X X ACARS over Iridium X X QAR X X X Aircraft Health Monitoring (Trends & exceedances - engine/airframe) X X X ICAO: Global Flight Tracking X X Autonomous Distress Tracking X Live Black Box Streaming X Real-time Systems Diagnostics X TSO C-159A (Voice & Data) X STCs Supporting 95% of Air Transport Aircraft X
  16. 16. 16TSX.V: FLY OTCQX: FLYLF Feb 2018 Annual Revenues $6,469,806 $8,000,364 $6,882,028 $10,457,125 $14,331,191 $0 $2,000,000 $4,000,000 $6,000,000 $8,000,000 $10,000,000 $12,000,000 $14,000,000 $16,000,000 2012 2013 2014 2015 2016 Strong Revenue Growth! 2016 Revenue: +37% increase over 2015 2015 Revenue: +52% increase over 2014
  17. 17. 17TSX.V: FLY OTCQX: FLYLF Feb 2018 30.5% 27.4% 40.6% 1.5% Voice and data services (SAAS) AFIRS sales Parts (and License Fees) Services 2016 Revenue by Source Total 2016 Revenue: $14,331,191
  18. 18. 18TSX.V: FLY OTCQX: FLYLF Feb 2018 EBITDA -$4,204,166 -$2,914,987 -$3,321,959 -$3,156,430 $2,503,610 -$5,000,000 -$4,000,000 -$3,000,000 -$2,000,000 -$1,000,000 $0 $1,000,000 $2,000,000 $3,000,000 2012 2013 2014 2015 2016 *Paid back $5.6M in matured debentures in 2016
  19. 19. 19TSX.V: FLY OTCQX: FLYLF Feb 2018 Gross Margins: All Revenue Sources 57.2% 59.2% 62.9% 69.3% 68.4% 50% 55% 60% 65% 70% 75% 2012 2013 2014 2015 2016
  20. 20. 20TSX.V: FLY OTCQX: FLYLF Feb 2018 Sales Order Backlog > $27M, Growing **Contracted hardware backlog plus 60 month value of contracted, undelivered services – does not include license fees $27,081,344 $0 $5,000,000 $10,000,000 $15,000,000 $20,000,000 $25,000,000 $30,000,000 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Backlog for AFIRS units and Subscription Services, Only CAD
  21. 21. 21TSX.V: FLY OTCQX: FLYLF Feb 2018 Revenues Based on Location • Over 1,900 shipped and/or installed units, all channels • 1.9 million flights and 2.9 million hours of in-service use on units providing SaaS subscription voice and data services
  22. 22. 22TSX.V: FLY OTCQX: FLYLF Feb 2018 Leadership Matieu Plamondon COO David Perez VP, Sales & Marketing Derek Payne CFO Thomas R. Schmutz CEO Steve Newell VP, Business Development Derek Graham CTO
  23. 23. 23TSX.V: FLY OTCQX: FLYLF Feb 2018 • Barry Eccleston, former President of Airbus Americas, Inc. • John Belcher, former Chairman and CEO of ARINC • Mark Rosenker, former Chairman of the National Transportation Safety Board • Jack Olcott, former President of the National Business Aviation Association • Canadian Board Members: Bill Tempany, Mike Brown, Jacques Kavafian, Doug Marlin, Paul Takalo Industry-Connected Board Members
  24. 24. 24TSX.V: FLY OTCQX: FLYLF Feb 2018 Capital Market Profile Share Price – As of February 7, 2018 (all dollar figures are in Canadian dollars) Share Price $1.87 Market Capitalization $39.3 million 52-week low $1.76 - high $2.95 Share Structure - As of Sept 30, 2017* using post-consolidation (July 17, 2017) amounts Shares 21,038,617 Diluted (assuming all instruments converted/exercised) 23,872,515 Diluted (assuming only instruments of value converted/exercised) 21,757,586 Warrants Outstanding (weighted avg. exercise price ($2.49)) 1,716,000 Stock Options Outstanding (weighted avg. exercise price ($2.49)) 1,122,898 Insider Holdings (Directors and Officers) 4.7% Debt (Low-interest, government debt) $1.8 million
  25. 25. Thank You www.flyht.com investors@flyht.com

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