FLYHT Aerospace Solutions Ltd. (TSX-V: FLY) (OTCQX: FLYLF) (the
“Company” or “Flyht”) today reported financial results for the
third quarter ended September 30, 2020.
“We are encouraged that our customers have
started a slow recovery from the May 2020 lows, with consistent
increases in the number of flights and hours month over month, even
as the aviation industry continues to suffer from a historic
reduction in passenger travel resulting from COVID-19,” remarked
Bill Tempany, Interim CEO. “Our business continued to feel the
impact with revenue categories well below average and far below
last quarter in most cases. Despite the unprecedented pandemic
induced headwinds, we strengthened our cash position compared to
the first two quarters of the year due to prudent cash management,
strong collections and helpful government support programs. We also
saw a sequential recovery of our SaaS revenue, which now represents
86% of our total revenue with gross margins approaching 70%.”
Tempany continued, “Downsizing costs will become
an even higher priority for airlines in the era of curtailed
demand, and the challenging environment is accelerating our
strategic re-focus on our software-first strategy. To date we have
signed up the first two launch partners for our Actionable
Intelligence suite of SaaS applications, which is uniquely suited
to help the global aviation industry improve operations and
profitability. Our tools bring substantial cost savings to airlines
and highly profitable recurring revenue to Flyht.”
Concluded Tempany, “We are well positioned to
help our customers as their businesses recover, with the right team
in place to use the new technologies to deliver on the industry
stated goals of using digital technology and artificial
intelligence to assist in recovery. Our efforts in recent months to
refocus, retrain and return to our roots as a value added SaaS
provider to the airlines will be the linchpin to our success as our
customers recover and people’s lives return to normal.”
Third Quarter
2020 Financial
Overview
Total revenue decreased by 63% to $1,918,410
compared to the third quarter of 2019. This decrease was seen
across all revenue categories, including SaaS -38% to $1,652,001,
Hardware -93% to $137,137, Licensing -85% to $86,033, and Technical
Services -54% to $43,239. While down over last year, SaaS increased
sequentially by 27% and now represents 86% of revenue.
Other income of $0 in the third quarter of 2020
compared to $623,544 in the third quarter of 2019. The last of the
reconciling items from the October 2018 asset acquisition of
Panasonic Weather Solutions was recognized in the second quarter of
2020.
Gross margin was 69.2% of revenue, compared to
48.5% in the third quarter of 2019. The increase in gross margin
was due to a favorable overall mix shift toward higher margin SaaS
revenue.
Operating expenses decreased by 31% from the
third quarter of 2019. A 70% decrease in Distribution expense was
partially offset by modest increases in Administration (9%) and
Research and Development expenses (8%). COVID-19 governmental
funding of $823,291 recognized in the quarter contributed
significantly toward the year over year decrease, with the
remainder of the decrease reflecting cost containment efforts.
EBITDA¹ loss totaled $1,079,873 in the
quarter compared to a loss of $460,907 in the third quarter of
2019.
_______________________________¹ EBITDA: defined
as earnings before interest, income tax, depreciation and
amortization (a non-GAAP financial measure).
Net loss was $1,647,249, compared to net loss of
$460,907 in the third quarter of 2019.
Balance Sheet and
Liquidity
Flyht’s balance sheet ended the quarter with a
cash balance of $4,107,483, an increase compared to the second
quarter of 2020 balance of $3,702,824 and approximately even with
2019 year-end’s balance of $4,127,648.
Trade and other receivables decreased from 2019
year-end by $1,608,598, or 32%, reflecting strong collections of
outstanding customer balances.
The balance sheet also shows an increase in
Property and Equipment, with a corresponding increase in Lease
Liability, as Flyht brought a new building lease for its Calgary
headquarters onto the balance sheet, having taken possession of the
space in March 2020.
Total basic and diluted weighted average shares
outstanding for the three months ended September 30, 2020 were
26,663,861.
Conference Call Information
Flyht will host a live conference call to
discuss its third quarter results on Friday, November 6, 2020
at 7 am MDT (9 am EDT, 6 am PDT). The conference call will include
a brief presentation from FLYHT’s 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.A., the
toll-free number is 1-800-319-4610. Outside Canada and the
U.S.A., dial 1-604-638-5340. Callers should dial in 5 to 10
minutes prior to the scheduled start time.
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 to investors@flyht.com. An archive
of the conference call will be posted on
Flyht’s website as soon as it is available from the
conference call provider.
Additional Information
Flyht’s Q3 2020 Report, which contains more
detailed information including the CEO’s Message, Management
Discussion and Analysis and Financial Statements, has been posted
to the Company’s website at http://flyht.com/financial-reports/.
The MD&A and Financial Statements have also been filed with
SEDAR, accessible at www.sedar.com.
About FLYHT Aerospace Solutions
Ltd.
Flyht provides airlines with Actionable
Intelligence to transform operational insight into immediate,
quantifiable action, delivering industry leading solutions to
improve aviation safety, efficiency and profitability. This unique
capability is driven by Flyht’s patented aircraft certified
hardware products including AFIRS™, a satcom aircraft interface
device which enables real-time streaming of flight information,
cockpit voice and black box data streaming and TAMDAR™, which
aggregates and streams airborne weather data in real-time. Flyht is
headquartered in Calgary, Canada with an office in Littleton,
Colorado, and is an AS9100 Quality registered company. For more
information, view our latest presentation here, or
visit www.flyht.com.
Contact Information:
FLYHT Aerospace Solutions Ltd. |
FNK IR LLC |
Alana Forbes |
Matt Chesler, CFA |
Chief Financial Officer |
Investor Relations |
403.291.7437 |
646.809.2183 |
aforbes@flyht.com |
flyht@fnkir.com |
investors@flyht.com |
|
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