flyht aerospace solutions ltd

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We chose this title for the simple reason that everything surrounding FLYHT’s organizational life is massive, moves when it wants, accomplishments are measured in years, and much of the company’s destiny is determined by “others”. The aviation industry is painfully slow to adopt change. The airlines move at a glacial pace and government is ever present requiring approvals each step of the way. Without doubt, this trek requires management, directors and shareholders to have the patience of Job. While there have been moments in FLYHT’s “long march” where it appeared the company was nearing the breakthrough point, the question now is; is the sun appearing over the horizon? Over the past 10 years the company has built numerous industry relationships, obtained a myriad of governmental approvals and its second generation technology (Automated Flight Information Reporting System, or AFIRS TM ) is now receiving much head nodding from the aviation industry. As an aside, it took approximately 10 years for Dr. David Warren, the inventor of the “black box”, to receive the blessing of governments and acceptance by the aviation industry. Irrelevant of the logic of a flight data recorder and cockpit voice recorder, it was a mighty struggle for the Australian scientist to convince government and industry to embrace his technology. This great thinker, who in 2007 was included in the "Top 100 Living Geniuses" was likely influenced by the death of his father in a 1934 air crash. We cite the example of Dr. Warren, as for quite some time we have heard the much repeated mantra of FLYHT management, “we need ten years”; “it takes ten years”. And so, here we are in year ten of the evolution of the idea! One constant in the evolution and development of an idea is that it needs the support of others to become more than a dream. How could FLYHT have survived and found the fuel to push against the constant headwinds if a small legion of people had not poured millions of dollars into the dream? Is it now the time the dream becomes reality? Living next to you is in some ways like sleeping with an elephant. No matter how friendly and even-tempered is the beast; one is affected by every twitch and grunt.- Former Canadian Prime Minister Pierre Elliot Trudeau (thoughts on the United States) By: Grant Howard & Dave Burwell Contributions from: Harvey Brovald & Lisa Montanini 1

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Page 1: FLYHT Aerospace Solutions Ltd

We chose this title for the simple reason that everything surrounding FLYHT’s organizational life is massive, moves when it wants, accomplishments are measured in years, and much of the company’s destiny is determined by “others”. The aviation industry is painfully slow to adopt change. The airlines move at a glacial pace and government is ever present requiring approvals each step of the way. Without doubt, this trek requires management, directors and shareholders to have the patience of Job. While there have been moments in FLYHT’s “long march” where it appeared the company was nearing the breakthrough point, the question now is; is the sun appearing over the horizon?

Over the past 10 years the company has built numerous industry relationships, obtained a myriad of governmental approvals and its second generation technology (Automated Flight Information Reporting System, or AFIRSTM) is now receiving much head nodding from the aviation industry. As an aside, it took approximately 10 years for Dr. David Warren, the inventor of the “black box”, to receive the blessing of governments and acceptance by the aviation industry. Irrelevant of the logic of a flight data recorder and cockpit voice recorder, it was a mighty struggle for the Australian scientist to convince government and industry to embrace his technology. This great thinker, who in 2007 was included in the "Top 100 Living Geniuses" was likely influenced by the death of his father in a 1934 air crash. We cite the example of Dr. Warren, as for quite some time we have heard the much repeated mantra of FLYHT management, “we need ten years”; “it takes ten years”. And so, here we are in year ten of the evolution of the idea! One constant in the evolution and development of an idea is that it needs the support of others to become more than a dream. How could FLYHT have survived and found the fuel to push against the constant headwinds if a small legion of people had not poured millions of dollars into the dream? Is it now the time the dream becomes reality?

“Living next to you is in some ways like sleeping with an elephant. No matter how friendly and even-tempered is the

beast; one is affected by every twitch and grunt.”

- Former Canadian Prime Minister Pierre Elliot Trudeau (thoughts on the United States)

By: Grant Howard & Dave Burwell

Contributions from: Harvey Brovald & Lisa Montanini

1

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Short and sweet, it’s obvious FLYHT secured its corporate relationships because of the merits of its technology. Would time have been wasted by multi-billion dollar conglomerates such as L-3 Communications, AirBus, Bombardier, NetJets (Europe) and Jabil, if they didn’t see the future and the ability to make money with FLYHT’s technology?

Jumping through government hoops isn’t a simple or inexpensive affair.

However, FLYHT has established expertise in navigating through government approvals with having in hand more than 40 Supplemental Type Certificates (approval to modify an aircraft). These apply to multiple countries and multiple aircraft. Each STC takes approximately six months to complete and costs approximately $75,000.

There is also the aspect of peer respect. As an example, why was FLYHT invited

to participate in the hearings investigating the 2009 Air France 447 disaster? A key component of the investigation was what could be done to prevent a similar disaster.

Government mandates requiring aircraft satellite communication are coming in

force. Nigeria has embraced FLYHT’s technology, making it the only satellite communication technology that fully meets the Nigerian Civil Aviation Authority’s recommended solution.

Of extreme importance are recent pronouncements from China that the

government has accepted recommendations for mandatory planning and installation of satellite communications on all aircraft in the country. Satellite avionics will be phased in starting immediately with 100% of the commercial and transport fleets to be enabled by the end of 2016.

The Howard Group Insight LIVE! Blog - “Reports Indicate All Commercial Aircraft In China Must Begin Installing Satellite Communication Systems”

Underpinning all of the above is not only the successful history of the first generation AFIRSTM technology or the “220” but the many new features, reporting and monitoring capabilities of the new “228”. In fact, the 228 enhances a globally accessed monitoring and real-time reporting system.

FLYHT Video - Matt Bradley, VP of

Operations, describes the AFIRS system

advantages.

This initiative was based on customer

requests as well as the opportunity management identified from tougher environmental regulations, especially in Europe. Approximately $30 million has been spent to date on developing the technologies over the past decade.

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An appropriate analogy is that the 220 is a very good cell phone. The 228 is the smart phone. The progress is clear as the company now has 230 active AFIRS (majority being 220 series) units on every continent, with more than 30 customers. However, the climb has been slow due to the fact that the contracts are small in nature, ranging from 2 to 10 units on average. What we are all awaiting is for FLYHT to deliver the “hockey stick” growth expected of a technology company. Now, in context of:

The years of development,

Multiple government approvals,

Development of an advanced & unique technology,

The company has only lost a customer due to bankruptcy,

A steadily increasing sales flow,

Third party verification by the nature of agreements with conglomerates,

As of April 30th, almost 1.3 million flight hours with AFIRS onboard has been recorded,

AFIRS is an Airbus option on A320 and A350 aircraft,

Airbus customer installations projected to start in late 2013,

A long standing presence in China, which is moving quickly on satellite avionics. The Chinese Civil Aviation Authority certified AFIRS 228 deployment in China,

The first AFIRS unit has been factory installed on a Bombardier CRJ900 aircraft for China Express Airlines,

As of this writing, ten of thirty 228 units are installed and being activated on NetJets Europe (Warren Buffet’s business enterprise),

AFIRS has and is being installed on C-130 (Hercules) transports that are at the forefront of a global retrofit push involving more than 2,400 aircraft,

Recurring revenues are rising and,

Management is calling for Q4/13 to be cash flow positive.

We feel it’s important to spend a moment talking about The Howard Group’s (HG)

history with FLYHT (formerly AeroMechanical Services) in context of the length of time it’s taken the business and the story to unfold. We can appreciate investor fatigue the same as we can appreciate the fact that people who are relatively new to the story get genuinely enthusiastic about the potential based on what has been accomplished and what could come to pass with this company.

Is FLYHT nearing the inflection point?

History – The Howard Group

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This marks our eighth year as first, investors and approximately five years assisting the company in building its messaging, branding, relationships and shareholder base. FLYHT represents The Howard Group’s single largest collective dollar investment in our 25 year history. We still own the stock purchased in late 2005 as well as stock purchased in a long ago $1.00 private placement. There are approximately 3.4 million shares held directly in our office through The Howard Group, members of HG and the associated Insight Limited Partnership II. When additional direct relationships with HG and LP II are factored into the equation, the share count escalates rather dramatically. Our long-standing interest in FLYHT provides us with a significant amount of context around what was and what was expected, but without losing sight of what can be, which keeps us aligned with the company. Clearly, we have a bias and, as such, declare it at the outset of this “Perspective”. Also, HG receives fees for its capital market and investor out-reach programs on behalf of FLYHT. HG is not a registered investment advisor. As such, this commentary solely deals with HG’s perspectives on why it is aligned with FLYHT. Readers should carefully consider all opinions and seek registered investment advice. Most people are quite surprised to learn that in this day and age the vast majority of airplane systems cannot be tracked by ground control and cannot communicate with ground control over the vast majority of the planet. People are also just as amazed when they hear that FLYHT has one of the only recognized solutions in the world that provides this functionality to the multi-billion dollar airline industry. What is even more surprising to people who have been recently introduced to the company is that it only has a valuation of $30 million.

FLYHT has built and patented a fully integratable satellite solution for the instant transmission of data and voice to and from an aircraft. It utilizes the Iridium satellite

network, which is a low orbiting satellite network and allows for worldwide coverage. AFIRS™ (Automated Flight Information Reporting System) has been called the “blue box of black boxes”. It is not designed to replace the black box; it does however complement the black box by providing real time data transmission and interpretation. In the event of an emergency, AFIRS™ automatically sends vital data from the aircraft to the ground and provides ground control with the aircraft position and other key information.

The Environment – Context

An Overview Of AFIRSTM

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Once the AFIRS unit is installed, airlines have a menu of different solutions, each of which provides value to its customers. Activating and deactivating a service is a matter of clicking a few buttons at FLYHT’s headquarters.

Global communications & flight tracking

Texting & real-time credit card validation

Engine trending Fuel management

Accurate Out, Off, On, In times Real-time flight operational quality assurance

Emergency data streaming Other solutions are being developed based on industry trends

Savings to the client for solutions such as engine trending and fuel management have proven to be significant, and FLYHT has experienced absolute customer satisfaction to date with no contracts ever cancelled except by the bankruptcy of an airline. Here’s how AFIRS™ works.

FLYHT’s products and services are currently being used on every continent on the globe, serving more than 35 aircraft operators worldwide – a number that is constantly growing.

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Air France Flight 447 was on a scheduled international flight from Rio de Janeiro, Brazil to Paris, France. The Airbus A330 aircraft departed late on the 31st of May 2009 from Rio and crashed in the Atlantic Ocean in the early hours of June 1st. The crash occurred about three hours and 45 minutes after takeoff, in an area of the Atlantic Ocean about 435 nautical miles north-northeast of Fernando de Noronha island. There were no emergency or distress messages sent by the crew. Ground control did not even know that the airplane went down until an estimated half an hour after the crash occurred; by this time the window of opportunity for any sort of rescue effort was closed. Debris from the aircraft was found near the estimated position of its last radio communication. There were 216 passengers and 12 crew members on board. A total of 50 bodies were recovered from the ocean and the remaining passengers and crew are missing and presumed dead. The aircraft black boxes were not found for almost two years after the accident and cost many millions of Euros to recover. The French Bureau d'Enquetes et d'Analyses (BEA) led the three-year investigation into the crash. FLYHT was asked to participate in the investigation work group, designed to bring in recommendations that would help prevent or minimize the effects of a similar disaster in the future. On the basis of this work, the BEA published a series of reports of recommendations for the ESA and ICAO including:

Extend as rapidly as possible to 90 days the regulatory transmission time for underwater locator beacons (ULB’s) installed on flight recorders on aeroplanes performing public transport flights over maritime areas;

Make it mandatory, as rapidly as possible, for aeroplanes performing public transport flights over maritime areas to be equipped with an additional ULB capable of transmitting on a frequency (for example between 8.5 kHz and 9.5 kHz) and for a duration adapted to the pre-localisation of wreckage;

Study the possibility of making it mandatory for aeroplanes performing public transport flights to regularly transmit basic flight parameters (for example position, altitude, speed, heading).

BEA Final Report – page 206

Air France Disaster – Industry Weaknesses Exposed

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Much like a cell phone provider, there are three ways in which FLYHT generates revenue: 1) The initial sale and installation of the unit, 2) The sale of additional services and applications, and 3) Recurring monthly usage charges.

With each new contract, revenues are initially heavily allocated towards the sale and installation of the kit itself. Once the box is in place, revenue continues to be generated from service and recurring revenue fees. The revenue breakdown is as follows: 1) The purchase of the kit (the base including wiring that houses the AFIRS unit) and the AFIRS unit itself:

o Cost ranges between $45,000 - $60,000 (Margin ~ 45%). 2) Recurring revenue generated per flight hour:

o Generates approximately $200 - $2,000 per month (85% margin). The amount is dependent on which functionality the airline chooses to utilize.

There are approximately 300 AFIRS 220 and AFIRS 228 units presently installed on aircraft around the world. The number of units considered active can fluctuate depending on aircraft utilization and maintenance schedules. Of these 300, approximately 200 are currently generating monthly income. About another 90 of these are expected to be generating monthly income by the end of 2013.

FLYHT Business Model

Orders, Installs & Activated AFIRSTM

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To date, 80 or so more units are on order, which will bring the number of revenue-earning units up to about 400 once delivered. Management expects these deliveries to be completed by the end of 2013, if not before.

NYSE: LLL

Market Cap: $7.63 Billion 2012 Financial Results: Net Sales - $13.15 Billion Diluted Earnings per Share - $8.30 Founded in 1997, L-3 is a global supplier of command, control, communications and intelligence systems. The company supplies its products to the American Department of Defense, NASA and other U.S. Government intelligence agencies. L-3 is the world’s largest supplier of black boxes to the aviation industry accounting for approximately 85% of the total in the world. November 2009:

o L-3 and FLYHT announced a strategic alliance. May 2012:

o Jointly win bid to supply Airbus A320 customers with real-time data communications and SatCom solutions. Airbus produced approximately 450 A320 aircraft in 2012. This number is expected to rise in 2013 and FLYHT believes that approximately 25% of new Airbus aircraft will be manufactured with AFIRS™ on board.

o List of yearly orders and delivered Airbus 320 aircraft, from Wikipedia.

o In the agreement, L-3 manufactures and sells the AFIRS units and FLYHT is paid a license fee of $6,000/unit and collects 100% of the recurring revenue from the streaming of data.

Opportunities Coming to Fruition – It’s Only Taken A Decade!

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Europe NetJets, a subsidiary of Berkshire Hathaway, was established in 1964 to offer private business flights. The company is the largest global fractional operator in the world, offering clients shorter travel times and access to more airports. March 2012:

o After two years of testing and evaluating the AFIRS™ technology, FLYHT announced a contract to supply all 30 of NetJet Europe’s Hawker Beechcraft fleet with AFIRS™.

o Details of the contract include: o $6 million, 5 year contract o $600k upfront o $60k per month of new recurring revenue beginning in Q2-2013

o The deal represents less than 5% of NetJets total global fleet providing

significant opportunity for additional contracts. May 2012:

o Hawker Beechcraft filed for Chapter 11 bankruptcy protection. September 2012:

o FLYHT received its key STC certification to install the technology on the Hawker fleet.

February 2013: o Beechcraft (shed the Hawker name) emerged from bankruptcy protection. This

process slowed the installation efforts of the AFIRS units; however FLYHT management is confident that the installations are back on track.

May 2013: o To date FLYHT has installed and activated 10 of the 30 AFIRS units.

China - The Wall Is Coming Down The Civil Aviation Authority of China (CAAC) has mandated that satellite communications be equipped on all aircraft by the end of 2016. Why is this significant for FLYHT? FLYHT’s AFIRS™ solution is the only “certified” solution for the Iridium network in China. Its competition providers using the “Inmarsat” satellite network do not provide full global coverage and they are five times more expensive. According to CAAC all airlines in China must equip satellite communications to:

Government Mandates & Satellite Communications – Keys To Unlocking The Future

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Yearend 2013 - all Chinese airline operators shall write an implementation plan of their fleet equipped with satellite avionics based on individual fleet type.

Yearend 2014 - 45% of the fleet must have satellite avionics. Yearend 2015 - 70% of the fleet must have satellite avionics. Yearend 2016 - 100% of the fleet must have satellite avionics. Imported aircraft after January of 2013 must have satellite avionics.

According to a recent CAAC report, the total Airbus and Boeing fleet in China is 1,596 planes (with Airbus at 812). This would bring the total number of planes that need to have sat-com installed by 2015 to over 2,000. Nigeria – Air Disasters = The Mandating Of AFIRSTM On All Aircraft

In 2005, Nigeria experienced two aircraft disasters in less than two months, leaving over 200 people dead. Most recently, the Dana Air Flight 992 disaster in June of 2012 was so severe that it destroyed the black box and all the data within it. The Nigerian Civil Aviation Authority (NCAA) has been working tirelessly to restore confidence in the country’s domestic flights by developing new safety regulations including satellite communication requirements. In November of 2012 it was announced that all airline operators in Nigeria were given a deadline of six months in which to comply with the recommendations made by the NCAA or face sanctions.

FLYHT’s AFIRS technology is the only satellite communication technology that fully meets the NCAA’s recommendations and, as such, new contracts have been trickling in one by one with more expected before the six month deadline is up in May of this year. According to Wikipedia, Nigeria has approximately 110 aircraft, 35 of which FLYHT has received orders for to date. FLYHT Signs Master Service Agreement With Jabil In early January, FLYHT announced that Jabil Defense and Aerospace (NYSE:JBL) will begin immediately manufacturing the AFIRS 228 products Jabil is a

multibillion dollar manufacturer covering a number of sectors such as defense and clean tech. Out-sourcing the manufacturing of the AFIRS units according to management, will reduce lead times and will ensure fulfillment for anticipated large volume orders.

http://www.jabil.com/

The Howard Group Insight LIVE! Blog – “Anticipated Surge In AFIRS 228 Orders – FLYHT

Aerospace &Jabil Sign Manufacturing Agreement”

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FLYHT has spent more than ten years navigating through the aviation industry’s regulatory environment, which FLYHT’s management has stated is a “natural barrier to entry.” Each OEM and airline does its own due diligence on the technology. L-3, for example, took three years before FLYHT was able to announce a joint deal with them. FLYHT holds patents on the AFIRS™ technology in Canada, the United States, Europe, Brazil, China, India and Turkey, with many more currently underway.

Country Patents Patent Number

China Aircraft Flight Data Management System Zl200380108585.9

Europe Aircraft Flight Data Management System 1563616

United States Aircraft Flight Data Management System 7,203,630

Country Patents Pending Patent Number

Brazil Automated Aircraft Flight Data Delivery and Management System with Demand Mode

611232876

Canada Automated Aircraft Flight Data Delivery and Management System with Demand Mode

2769119

China Automated Aircraft Flight Data Delivery and Management System with Demand Mode

201080035710.8

Europe Automated Aircraft Flight Data Delivery and Management System with Demand Mode

10807842.9

India Automated Aircraft Flight Data Delivery and Management System with Demand Mode

1176/DELNP/2012

United States Automated Aircraft Flight Data Delivery and Management System with Demand Mode

13/387,011

Canada Multiple Satellite Modem System Using A Single Antenna 2010/002018

China Multiple Satellite Modem System Using A Single Antenna 2010800586380

Europe Multiple Satellite Modem System Using A Single Antenna 108348465.2

United States Multiple Satellite Modem System Using A Single Antenna 13/509,334

Turkey Method For Flight Information Collection and Transmission TR201112804T4

Why Won’t (Can’t) Others Develop A Similar Technology?

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The company has obtained over 40 Supplemental Type Certificates (STC). An STC is

required for each type of aircraft in each jurisdiction where installation is required.

Each STC costs approximately $75,000 and takes approximately 6 months to

complete.

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As you can see in the chart below, sales have been relatively flat over the last several years. The reality has been that FLYHT has had to work hard to counter the impact of airline bankruptcies and the decommissioning of airplanes. Quarterly Sales and Usage

The above numbers need to be considered in context of the fact that:

o For two years FLYHT was focused primarily on developing its new technology.

o Four contracts were lost due to specialty carrier bankruptcies (equivalent to 36% of annual revenues) but these losses were offset with additional contracts.

o Usage fees were lower than expected due to many customers downsizing (for example the US military with the war wrapping up).

o The fact that revenues didn’t fall considering these circumstances is noteworthy.

Are FLYHT’s Revenues Poised To Accelerate?

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Quarterly R&D Expenses

Since the start of 2010, FLYHT has spent approximately $12.3 million on Research and Development. FLYHT management is on the record stating that while there will always be R & D, required costs will continue to fall, as the bulk of the work has been completed on the AFIRS 228. Declining R & D expenditures have certainly been the trend over the last several quarters. Annual Revenues

In the same period since the beginning of 2010, total revenues came to $16.62 million. As is evident, to cover G & A costs and deliver positive cash flow, the company must see R & D expenditures

continue to decline while delivering accelerated sales.

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While eResearch has published material on FLYHT, it has not set a target price. LOM (USA) has set a $0.40 target, based on a number of factors as discussed in The Howard Group blog of March 25 of this year.

The Howard Group Insight LIVE! Blog - “LOM Says Buy FLYHT - $0.40 Price Target”

Senior Technology Analyst Noel Atkinson is clearly buying into the scenario that FLYHT is nearing the inflection point, as he’s calling for revenues to be just shy of $8 million this year and jumping to $13.5 million in 2014 and $20 million in 2015 with positive EBITDA in ‘14 and ‘15.

We’ll call FLYHT’s market over the past two years, “the long watch”. In the period May 2011 to the publication of this Perspective being May 2013, FLYHT has traded just under 60 million shares. We reviewed the Average Purchase Price (APP) of the top twenty firms that bought the stock in that two-year period. In that time the lowest APP was $0.188 and the highest was $0.229 or a meagre 4.1 cent spread. Yes, 4.1 cents on a twenty cents or so stock is a meaningful percentage but in the grand scheme, it’s not much of anything. This is a market range on a company specific basis that is pleading for a reason to move higher. As such, FLYHT management has the ball. We use the term “company specific”, as the broad base of junior companies on the TSX Venture Exchange have been under significant pressure over the past two years. FLYHT has, and can, break away from the pack. We remember the heady days of late 2007 & early 2008 as the stock hit $1.40 on great growth expectations. The simple point is that FLYHT is a bit of a unique creature that was seen as having incredible potential. It has a large shareholder base and, from our experience, loyal institutions. It is our simple observation that, based on 25 years of deep involvement with the junior market, FLYHT shareholders and watchers are saying, “please, re-energize me”.

There are no lack of “eyes” on the company. Over the past year there have been multiple shareholder presentations and meetings with fund managers throughout Canada and the United States and, as of this writing, Europe. Without question, the company’s business is appealing, and now it is time to make “the story” appealing based on very solid business developments that point a clear path to a much greater fundamental valuation.

The Analysts

The Market & A Summary

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To receive future news and commentary on FLYHT please email: [email protected]

Subject Line – Receive FLYHT information

Please provide us with relevant contact information and whether or not you are an individual investor, investment advisor, analyst or fund manager. Also, please indicate if you would like

someone to call you to discuss FLYHT. We also appreciate your comments & feedback.

In our long history with FLYHT (formerly AeroMechanical Services) the single point that has never changed is that people find it fairly easy to embrace the concept and attributes of the business. In fact, folks become somewhat emotionally attached to FLYHT’s vision. It just makes sense. FLYHT’s advanced technological capabilities heighten the level of aviation safety that air travellers would expect to already be in place. Even the first mission to the moon back in 1967 had air to ground communication! In a world where everyone is constantly connected and everything is instant, it’s a bit unsettling to think that the same airplanes offering live satellite TV are unable to offer live data transmission in the event of an emergency. Why should our expectation for instant communication be applied to entertainment and leisurely convenience but not to our own safety? Many times with micro-cap companies, investors are concerned about the associated risk and whether or not the business can gain traction and ultimately excel. The attractive feature of FLYHT’s business model is that it simply makes sense and there is a growing line of industry leaders that are in apparent agreement that the little forward thinking technology company from Calgary, Alberta is onto something special.

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The links below will allow you to reach The Howard Group when you require investor

information:

Email: [email protected] Website: http://www.howardgroupinc.com/Clients/FLYHTAerospaceSolutions.aspx

Newsletter Direct: http://howardgroupinsightnewsletter.blogspot.com/ Contact Information: Grant Howard/Dave Burwell The Howard Group Inc. Toll Free: 1-888-221-0915 Phone: (403) 221-0915

[email protected]

Disclaimer The Howard Group is not a registered investment advisor and as such, individuals should consult a registered investment advisor prior to making investment decisions in relation to the company discussed in this commentary. The information presented in these website pages was obtained from sources believed to be reliable but is not guaranteed, is not all conclusive and should not be relied upon as the sole source of information/opinion for making an investment decision. The Howard Group or its employees may own securities in the company discussed in this commentary. The Howard Group receives remuneration for Investor Relations activities from the company discussed in this commentary. Except for the statements of historical fact contained herein, certain statements contained in this presentation constitute “forward-looking statements” as such term is used in applicable Canadian and US laws. These statements relate to analyses and other information that are based on forecasts of future results and assumptions of management. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans or future events or performance (often, but not always, using words or phrases such as “expects” or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “plans”, “estimates” or “intends”, or stating that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved) are not statements of historical fact and should be viewed as “forward-looking statements”. Forward-looking statements are made based on management’s beliefs, estimates and opinions on the date the statements are made and the Corporation undertakes no obligation to update forward-looking statements if these beliefs, estimates and opinions or other circumstances should change, except as required by applicable law.

THIS IS NOT A RECOMMENDATION TO BUY OR SELL ANY SECURITY