Earnings release
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Volatus Aerospace Releases Q2 2025 Financial Results • Revenue of $10,587,075 in Q2 2025, up 49% year-over-year; gross margin of 32% • Adjusted EBITDA loss of $276,259, an 85% year-over-year improvement • Current cash balance strengthened to approximately $20M • Operational highlights included clearances and demonstrations with defense and energy clients and new commercial wins in forestry and agriculture. Subsequent events included additional NATO-aligned contracts and growth capital TORONTO, Aug. 20, 2025 -- Volatus Aerospace Inc. (TSXV:FLT) (OTCQB:TAKOF) (Frankfurt:A3DP5Y/ABB.F) ("Volatus" or "the Company"), a leader in aerial solutions, is pleased to announce its financial results for the three and six months ended June 30, 2025 (Q2 2025). All dollar figures are stated in Canadian dollars, unless otherwise indicated. Q2 2025 delivered another quarter of strong growth and operational progress, reflecting robust defense demand, expanding commercial programs, and disciplined execution. Equipment sales increased 104% quarter-over-quarter and 114% year-over- year, while services grew 71% quarter-over-quarter and 16% year-over-year. Operating leverage improved as revenue growth outpaced expense increases, and the net loss attributable to shareholders narrowed versus Q1 2025. Liquidity also strengthened, with positive working capital at quarter-end supported by an equity infusion, the reclassification of certain obligations to long-term after covenant compliance, and the conversion of debt into equity. Q2 2025 Financial Highlights: • Revenue: $10,587,075, an increase of 49% compared with $7,121,993 in Q2 2024, driven by strong equipment demand and continued services growth. • Gross Profit: $3,375,420, representing a gross margin of 32%, compared with 35% in Q2 2024. Margin reflects a higher proportion of equipment sales in the quarter. • Adjusted EBITDA: Loss of ($276,259), a significant 85% improvement versus ($1,852,178) in Q2 2024, reflecting scale, service growth, and cost discipline. • Cash Position: $6,125,646 at June 30, 2025, with current cash now approximately $20 million after subsequent financing events. • Revenue Mix: Services accounted for 52% of Q2 revenue and equipment 48%, supported by 71% quarter-over-quarter growth in services and 104% quarter-over-quarter growth in equipment. Q2 2025 Operational Highlights: • Major Regulatory Advancements Support National-Scale BVLOS Operations • Secured one-year extension of the federal standing offer (PWGSC) to March 31, 2026, ensuring continued access to federal contracts • Obtained clearance by two major oil and gas firms for RPAS pipeline surveillance • Completed a defense demonstration for a G-20 client showcasing fixed-wing VTOL and nano RPAS platforms • Entered a collaboration with J.D. Irving, Limited to deploy heavy-lift RPAS for large-scale tree planting • Awarded a national agriculture contract to deliver multispectral crop surveys at 21 sites across four provinces • Advanced commercialization of autonomous and remote operations through OCC-supervised BVLOS medical deliveries in Ontario Subsequent to Q2 2025 Operational Highlights: • Awarded $560,000 international training contract with a NATO member country • Closed $10 million LIFE offering • Launched Condor XL heavy-lift drone program • Delivered approximately $1 million tactical ISR drone contract from a NATO partner • Completed $4.83 million Quebec-led Institutional “bought-deal” private placement LIFE offering • Cash balance now approximately $20 million. Management Commentary “Q2 was fueled by growth across equipment and services, supported by strong defense demand and broader operating authorities,” said Glen Lynch, CEO of Volatus Aerospace. “With national-scale BVLOS approvals and our Operations Command Centre enabling safe, efficient remote missions, we are converting more of our pipeline into repeatable programs.
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We strengthened liquidity, improved operating leverage, and ended the quarter with positive working capital. As we look to the balance of the year, our focus remains disciplined execution for enterprise and government clients and steady progress toward profitability.” Strategic Outlook Volatus continues to lean into a changing geopolitical backdrop and Canada’s historic commitment to higher defence spending. The Company is positioning to capture growing domestic demand across defence, public safety, and Arctic surveillance, while accelerating commercialization of proprietary systems. Investment in Canadian design, production, and secure supply chains underpins Volatus’ goal of building sovereign capacity aligned with national priorities. The Company remains actively engaged with the Government of Canada and the Canadian Armed Forces on defence modernization, border protection, and Arctic sovereignty. Recent financing proceeds have been allocated to expand the defence segment, accelerate commercialization, and reinforce Volatus’ position as a national leader in aerial solutions Webinar Details: In conjunction with this release, Volatus will host a webinar on Thursday, August 21, 2025 at 4PM EST at which time Glen Lynch, Chief Executive Officer, and Abhinav Singhvi, Chief Financial Officer, will review financial results and major milestones with Danielle Gagne, Head of Corporate Communications as moderator. Registration Link: https://us06web.zoom.us/webinar/register/WN_K_HDfCINR8CMLh6072CN_w Audio Replay Options: An audio replay of the event will be archived on the Investor Relations page of the company's website https://investor.volatusaerospace.com/videos/ Q2 2025 Q1 2025 Q4 2024 Q3 2024 Q2 2024 Q1 2024 Q4 2023 Q3 2023 Revenue 10,587,075 5,713,158 6,783,176 6,618,504 7,121,993 6,623,741 10,500,995 8,274,349 Direct costs 7,211,655 3,883,185 4,209,577 4,366,107 4,617,447 4,397,985 7,700,881 5,265,775 Gross Profit 3,375,420 1,829,973 2,573,599 2,252,397 2,504,546 2,225,757 2,800,114 3,008,574 32% 32% 38% 34% 35% 34% 27% 36% OPERATING EXPENSES Advertising & marketing 428,128 135,575 100,878 331,763 397,357 293,339 278,781 541,635 IT & tech 118,017 245,180 157,851 210,328 259,456 256,802 28,439 243,602 Personnel 2,214,001 2,440,528 1,958,572 1,787,175 1,515,536 2,196,722 1,312,983 1,727,086 R&D 4,390 11,756 25,429 4,011 - 11,840 771,861 104,832 Office cost 714,212 438,182 673,047 497,706 554,050 583,199 605,396 722,276 Travel 73,765 64,288 38,959 77,011 40,143 57,621 126,710 90,804 External partner cost473,390 200,637 386,259 2,117,840 430,141 200,072 436,686 243,443 Depreciation and amortization 1,429,826 1,496,425 1,315,544 1,294,350 1,116,698 1,098,088 1,647,364 843,744 Share based Payments 168,717 165,454 77,523 124,861 126,822 126,822 173,671 195,372 5,624,446 5,198,025 4,734,061 6,445,045 4,440,202 4,824,504 5,381,891 4,712,793 (Loss) from Operations (2,249,026) (3,368,052) (2,160,462) (4,192,648) (1,935,656) (2,598,748) (2,581,777) (1,704,219) OTHER ITEMS - INCOME/ (EXPENSE) Finance cost (1,897,745) (645,685) (1,072,341) (992,806) (491,664) (379,106) (667,949) (425,671) Other income (expense) 17,104 (3,468) (133,884) (2,669) 153 (10,168) 14,955 (39,229) Unrealized gain on investments - (58,963) 247,661 - - Gain (Loss) on disposal of property and equipment - - (1,541) (194,662) 319,044 (7,184) (125,476) 228,769 Foreign exchange
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translation (58,413) 1,225 92,541 (109,037) 25,508 3,887 (24,156) 19,946 Net Loss (4,188,080) (4,074,943) (3,028,025) (5,491,822) (2,082,615) (2,991,319) (2,775,864) (1,920,403) Deferred Tax Income/ (Expense)210,377 (210,377) (100,899) 464,216 Net Loss (3,977,703) (4,285,320) (3,128,924) (5,491,822) (2,082,615) (2,991,319) (2,311,647) (1,920,403) Total comprehensive Income (loss) for the period attributable to: Owners of Volatus Aerospace Corp.(3,266,866) (4,241,643) (3,099,840) (5,440,827) (2,070,150) (2,915,143) (1,997,089) (2,427,597) Non-controlling interest (710,837) (43,677) (29,084) (50,994) (12,465) (76,176) (314,559) 507,194 (3,977,703) (4,285,320) (3,128,924) (5,491,822) (2,082,615) (2,991,319) (2,311,647) (1,920,403) Loss per share Basic and Diluted (0.01) (0.01) (0.01) (0.02) (0.02) (0.02) (0.02) (0.02) RECONCILIATION OF ADJUSTED EBITDA TO NET LOSS Three Months ended June Three Months ended June 2025 2024 Adjusted EBITDA (loss) (276,259) (1,852,178) Interest 1,897,745 491,664 Depreciation 1,429,826 1,116,698 Share-based Payments 168,717 126,822 Severance/discontinued Cost 357,120 - Foreign Exchange Translation 58,413 (25,508) Tax Expense/(Income) (210,377) - Proforma DDC Operating Expense - (1,479,239) Net Loss (3,977,703) (2,082,615) About Volatus Aerospace: Volatus Aerospace is a leader in innovative global aerial solutions for intelligence and cargo. With a strong foundation of over 100 years of combined institutional knowledge in aviation, Volatus provides comprehensive solutions using both piloted and remotely piloted aircraft systems (RPAS). We serve industries such as oil and gas, utilities, healthcare, and public safety. Our mission is to enhance operational efficiency, safety, and sustainability through cutting-edge, real-world solutions. Note Regarding Non-GAAP Measures: In this press release we describe certain income and expense items that are unusual or non-recurring. There are terms not defined by International Financial Reporting Standards (IFRS). Our usage of these terms may vary from the usage adopted by other companies. Specifically, gross profit, gross margin, and Adjusted EBITDA r Normalized EBITDA are undefined terms by IFRS that may be referenced herein. We provide this detail so that readers have a better understanding of the significant events and transactions that have had an impact on our results. Throughout this release, reference is made to “gross profit,” “gross margin,” and “Adjusted EBITDA” which are non-IFRS measures. Management believes that gross profit, defined as revenue less operating expenses, is a useful supplemental measure of operations. Gross profit helps provide an understanding on the level of costs needed to create revenue. Gross margin illustrates the gross profit as a%age of revenue. Adjusted earnings before interest, taxes, depreciation and amortization ("Adjusted EBITDA"). The Company defines Adjusted EBITDA as IFRS comprehensive loss excluding interest expense, depreciation and amortization expense, share-based payments, income tax expense, integration and due diligence costs, one time profit or loss (non-recurring), and impairment of goodwill, property, plant, and equipment and right-of-use assets (ROU). The Company believes that Adjusted EBITDA is a meaningful financial metric as it measures cash generated from operations which the Company can use to fund working capital requirements, service future interest and principal debt
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repayments and fund future growth initiatives. Readers are cautioned that these non-IFRS measures may not be comparable to similar measures used by other companies. Readers are also cautioned not to view these non-IFRS financial measures as an alternative to financial measures calculated in accordance with International Financial Reporting Standards (“IFRS”). Adjusted EBITDA does not have any standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other issuers and should not be construed as alternatives to comprehensive loss or income determined in accordance with IFRS. For more information with respect to financial measures which have not been defined by GAAP, including reconciliations to the closest comparable GAAP measure, see the "Non-GAAP Measures and Additional GAAP Measures" section of the Company’s most recent MD&A which is available on SEDAR. Forward-Looking Statement: This news release contains statements that constitute "forward-looking information" and "forward-looking statements" within the meaning of applicable securities laws, including statements regarding the plans, intentions, beliefs, and current expectations of the Company with respect to future business activities and operating performance. Often, but not always, forward-looking information and forward-looking statements 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 negative variations) of such words and phrases, or statements formed in the future tense or indicating that certain actions, events or results "may", "could", "would", "might" or "will" (or other variations of the foregoing) be taken, occur, be achieved, or come to pass. Forward-looking information includes information regarding: (i) the business plans and expectations of the Company; and (ii) expectations for other economic, business, and/or competitive factors. Forward-looking information is based on currently available competitive, financial, and economic data and operating plans, strategies, or beliefs as of the date of this news release, but involve known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. Such factors may be based on information currently available to the Company, including information obtained from third-party industry analysts and other third -party sources, and are based on management's current expectations or beliefs. Any and all forward-looking information contained in this news release is expressly qualified by this cautionary statement. Investors are cautioned that forward-looking information is not based on historical facts but instead reflects expectations, estimates or projections concerning future results or events based on the opinions, assumptions and estimates of management considered reasonable at the date the statements are made. Forward-looking information and forward-looking statements reflect the Company's current beliefs and is based on information currently available to it and on assumptions it believes to be not unreasonable in light of all of the circumstances. In some instances, material factors or assumptions are discussed in this news release in connection with statements containing forward-looking information. Such material factors and assumptions include, but are not limited to: the commercialization of drone flights beyond visual line of sight and potential benefits to the Company; and meeting the continued listing requirements of the TSXV. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. The forward-looking information contained herein is made as of the date of this news release and, other than as required by law, the Company disclaims any obligation to update any forward-looking information, whether as a result of new information, future events or results or otherwise. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accept responsibility for the adequacy or accuracy of this release. CONTACT DETAILS Abhinav Singhvi Chief Financial officer +1 833-865-2887 abhinav.singhvi@volatusaerospace.com COMPANY WEBSITE https://volatusaerospace.com SOURCE: Volatus Aerospace Inc.