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Volatus anticipatesunaudited proforma gross profit margin of approximately 31% in 2022compared to 26% in 2021. Consequently, management is pleased to reportpreliminary full-year 2022 gross profit margin consistent with itsoriginal guidance.
VolatusAerospace Corp. (“ Volatus ” or “the Company ”)(TSXV:VOL) (OTCQB:VLTTF) is pleased to announce preliminary, unauditedproforma Net Revenue and Gross Profit results for the three-monthperiod ended December 31, 2022 and year ended December 31, 2022(“FY-2022”) and Revenue and Gross Profit guidance for thefinancial year ended December 31, 2023 (“FY-2023”).
Volatus expects to report positive financial results underpinned by geographicand sector expansion. Based on preliminary unaudited proforma resultsfor FY-2022 prepared by management, Volatus expects to report FY-2022revenue of approximately C$38 million and FY-2022 Gross Profit ofapproximately C$11.6 million with an expected gross profit margin ofapproximately 31%. Additionally, Volatus is providing financialguidance targets for FY-2023. Volatus expects to report FY-2023Revenue of approximately C$52 million and FY-2023 Gross Profit ofapproximately C$16.6M million with a gross profit margin of 32%.Factors contributing to the expected increases in revenue, grossprofit and gross profit margin in FY-2023 include changes in productmix, conversion of existing active sales pipeline opportunities intosales, larger geographical presence, access to new markets and newproducts, commercialization of Volatus’ technologies such asAerieport and ISR drones, and the scaling of operations in the defencesegment. For greater clarity, the gross profit margin is derivedsolely by subtracting the costs of goods sold from total revenue anddividing such number by total revenue.
Q4-2022 and FY-2022 Preliminary Results
For thethree-month period ended December 31, 2022 (“Q4-2022”) andFY-2022, on a preliminary unaudited proforma basis (as discussed infurther detail below), management reports the following highlights:
- Q4-2022 unaudited proforma Net Revenue isexpected to be between C$7 million and C$8 million. Without accountingfor the proforma adjustment, Volatus expects to report unauditedrevenue between C$6.5 million and C$7 million. The FY-2022 unauditedproforma Net Revenue is expected to be approximately C$38million.
- Q4-2022 proforma Gross Profit is expected to bebetween C$2 million to C$2.5 million and FY-2022 unaudited proformaGross Profit is expected to be approximately C$11.6million.
- Organic revenue growth for FY-2022 compared toFY-2021 was approximately 45% as a result of access to new markets,entry in the defence segment, the sale of equipment, and continuedgrowth in the service and training segment.
- Volatusexpects to end 2023 with positive EBITDA on a run rate basis subjectto maintaining the Company’s current growth, the level of investmentexpenditure, and the timing of its customer orders.
Business Update
At the end ofFY-2022, Volatus has:
- Sold equipment and serviceson 3 continents.
- Expanded geographically in Latin Americaand the United Kingdom.
- Developed and began commercializing4 proprietary technologies.
- Completed 5 acquisitions.
- Expanded our defence and public safety businesses.
Subsequent to Q4-2022
- Completed theacquisition of Empire Drone.
- Received a domestic servicelicence from the Canadian Transportation Agency to provide drone cargoservices.
Gross Profit Margin. The Company derives gross profit margin bysubtracting costs of goods sold from total revenue and dividing suchnumber by total revenue.
“Despite macro-economic challenges and supply chainconstraints, the Volatus team has continued to demonstrate strongexecution in 2022. We issued a revenue guidance note of C$38M througha news release on February 16, 2022, and I am extremely proud ofachieving our target,” said Abhinav Singhvi, CFO of VolatusAerospace. “Continued geographic expansion, enhanced capabilities,accelerating industry adoption and cross-selling are expected to drivegrowth for the foreseeable future.”
TheCompany cautions that the above results are preliminary in nature andunaudited, as the Company’s audit for FY-2022 has not yet beencompleted. Actual results for FY-2022 may differ materially from theestimates disclosed in this news release due to the completion of theCompany’s financial closing procedures, final adjustments, review bythe Company’s auditors and other developments that may arise betweennow and the time the financial results are finalized. Actual resultsfor FY-2023 may differ materially from the estimates disclosed in thisnews release due to, among other things, supply chain challenges, theinability of strategic suppliers and resellers to perform theirobligations, rapid changes in the industry, increased competition,regulatory changes and hurdles, and the inability to expand indifferent markets due to geo-political risks. These estimates are nota comprehensive statement of the Company’s financial results forQ4-2022, FY-2022 and FY-2023 and should not be viewed as a substitutefor full financial statements prepared in accordance withInternational Financial Reporting Standards (“IFRS”), and theseestimates are not necessarily indicative of the results to be achievedfor Q4-2022, FY-2022 and FY-2023. A number of economic, market,operational and financial assumptions were made by the management ofVolatus in preparing its forward guidance, including, but not limitedto, the conversion ratio of the Company’s sales pipeline, success inthe bidding of RFQs, the ability to change the product mix and theCompany’s ability to maintain a competitive position, retain andincrease recurring revenue with customers, scale relationships withstrategic suppliers, maintain gross margins and retain its salesforce.
Thepreliminary results provided in this press release constituteforward-looking information and future-oriented financial informationwithin the meaning of applicable Canadian securities laws, are basedon a number of assumptions and are subject to a number of risks anduncertainties. The purpose of this future-oriented financialinformation is to provide readers with an understanding of theCompany’s ability to scale and maintain its competitive position andsuch future oriented financial information may not be appropriate forother purposes. Please see the section below entitled “CautionaryNote Regarding Forward-Looking Information and Future OrientedFinancial Information”. The preliminary results have been preparedby, and are the responsibility of, management of the Company. TheCompany’s auditor, MS Partners, has not reviewed the preliminaryresults. Neither MS Partners nor any other independent accountantsexpress an opinion or any other form of assurance with respect to thepreliminary results.
The Company will provide additional discussion and analysisregarding its fourth quarter revenue, gross profit, and EBITDA whenthe Company reports it Q4-2022 and FY-2022 results on April 17, 2023after the close of markets.
Non-IFRS Measures and Other FinancialMeasures
This news release contains references to EBITDA and grossprofit margin, which are not defined under IFRS. Management believesthe presentation of these metrics gives useful information toinvestors and shareholders, as they provide increased transparency andinsight into the performance of the Company. The data presented isintended to provide additional information and should not beconsidered in isolation or as a substitute for measures of performanceprepared in accordance with IFRS. Readers should not place unduereliance on non-IFRS measures and should instead view them inconjunction with the most comparable IFRS financial measures
EBITDA. The Companydefines EBITDA as IFRS net loss excluding interest expense,depreciation and amortization expense. EBITDA should not be construedas alternatives to comprehensive loss or income determined inaccordance with IFRS. EBITDA does not have any standardized meaningunder IFRS and, therefore, may not be comparable to similar measurespresented by other issuers. The Company believes that EBITDA is ameaningful financial metric as it measures cash generated fromoperations which the Company can use to fund working capitalrequirements, service future interest and principal debt repaymentsand fund future growth initiatives.
About Volatus Aerospace:
VolatusAerospace Corp. is a leading provider of integrated drone solutionsthroughout North America and growing into Latin America and globally.Volatus serves civil, public safety, and defense markets with imagingand inspection, security and surveillance, equipment sales andsupport, training, as well as R&D, design, and manufacturing.Through our subsidiary, Volatus Aviation, we are introducing green andinnovative drone solutions to supplement and replace traditionalaircraft and helicopters for long-linear inspections such as pipeline,energy, rail, and cargo services. Volatus is committed to carbonneutrality; the fostering of a safe, equitable and inclusiveworkplace; and responsible governance.
Forward-LookingInformation
This news release contains statements thatconstitute “forward-looking information” and “future orientedfinancial information” within the meaning of applicable Canadiansecurities laws, including statements regarding the plans, intentions,beliefs, and current expectations of the Company with respect tofuture business activities and operating and financial performance.Often, but not always, forward-looking information and future orientedfinancial information can be identified by the use of words such as“plans”, “expects”, “is expected”, “budget”,“scheduled”, “estimates”, “forecasts”, “intends”,“anticipates”, or “believes” or variations (including negativevariations) of such words and phrases, or statements formed in thefuture tense or indicating that certain actions, events or results“may”, “could”, “would”, “might” or “will” (orother variations of the foregoing) be taken, occur, be achieved, orcome to pass. Forward-looking information and future orientedfinancial information includes information regarding: (i) theCompany’s expectations of net revenue, gross profit, gross profitmargin and other financial projections for Q4-2022, FY-2022 andFY-2023; (ii) the business plans and expectations of the Company; and(ii) expectations for other economic, business, and/or competitivefactors. Forward-looking information and future oriented financialinformation is based on currently available competitive, financial,and economic data and operating plans, strategies, or beliefs as ofthe date of this news release, but involve known and unknown risks,uncertainties, assumptions and other factors that may cause the actualresults, performance or achievements of the Company to be materiallydifferent from any future results, performance or achievementsexpressed or implied by the forward-looking information. Such factorsmay be based on information currently available to the Company,including information obtained from third-party industry analysts andother third-party sources, and are based on management’s currentexpectations or beliefs. Any and all forward-looking information andfuture oriented financial information contained in this news releaseis expressly qualified by this cautionary statement. Investors arecautioned that forward-looking information and future orientedfinancial information is not based on historical facts but insteadreflects expectations, estimates or projections concerning futureresults or events based on the opinions, assumptions and estimates ofmanagement considered reasonable at the date the statements are made.Forward-looking information and future oriented financial informationreflect the Company’s current beliefs and is based on informationcurrently available to it and on assumptions it believes to be notunreasonable in light of all of the circumstances. In some instances,material factors or assumptions are discussed in this news release inconnection with statements containing forward-looking information.Factors that could also cause actual results to differ materially fromthose anticipated in the forward-looking information and the futureoriented financial information are described under the caption “RiskFactors” in the Company’s Annual Information Form dated June 30,2022, which is available on SEDAR at www.SEDAR.com. Although theCompany has attempted to identify important factors that could causeactual actions, events or results to differ materially from thosedescribed in forward-looking information, there may be other factorsthat cause actions, events or results to differ from thoseanticipated, estimated or intended. The forward-looking informationand future oriented financial information contained herein is made asof the date of this news release and, other than as required by law,the Company disclaims any obligation to update any forward-lookinginformation and financial oriented financial information, whether as aresult of new information, future events or results or otherwise.There can be no assurance that forward-looking information and futureoriented financial information will prove to be accurate, as actualresults and future events could differ materially from thoseanticipated in such statements. Accordingly, readers should not placeundue reliance on forward-looking information. Neither TSX VentureExchange nor its Regulation Services Provider (as that term is definedin policies of the TSX Venture Exchange) accepts responsibility forthe adequacy or accuracy of this release.
Source: VolatusAerospace Corp.
TSXV: VOL
ContactDetails
Abhinav Singhvi
+1 514-447-7986
abhinav.singhvi@volatusaerospace.com
CompanyWebsite
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