Monday, 15 September 2014

Insight Live! Has Moved

The Howard Group Insight Live! Blog has moved to its new home on our new website at

The Howard Group Blog provides an ongoing perspective on market conditions, corporate developments and events that affect our client companies.  CLICK HERE to register for the latest Howard Group client news.

All blogs prior to June 1, 2014 will remain on Blogger as archives for research and reference.

If you have any questions or concerns, please contact:

The Howard Group
phone: 403-221-0915  or  888-221-0915

Thursday, 14 August 2014

Critical Elements Announces Third Revenue Stream


Since returning from a trip to Japan last June, Critical Elements’ senior management have been very busy with numerous initiatives to de-risk and bring added value to their Rose Lithium-Tantalum project in Quebec.  Last week, the company strengthened its board of directors by adding Mr. Matthew Lauriston Starnes, an individual with an impressive background and experience in contract negotiations, legal and corporate governance.   Also that week, CRE announced that it achieved a 99.98% battery grade lithium carbonate purity, which bodes well for potential buyers that are desperately searching for a long term supplier to meet the growing global lithium demand.  Both pieces of news were well received  by the markets and rewarded the company with a 52 week high of $0.31 on its stock price.

Management continues to deliver good news to investors. Today the company announced that its low-iron lithium concentrate has been successfully tested by ceramic and glass manufacturers overseas.  This key news allows for a third revenue stream to stem from its commercialization plans.  

A point worth mentioning to investors is that in just a few years, and on a thrifty ~$6 million budget, Critical Elements discovered, drilled, initiated environmental work, and signed a pre-development agreement with the Cree community of Eastmain, completed metallurgy work, and a Preliminary Economic Assessment (PEA).  For a TSX Venture junior in the resource sector, this is a very rare and impressive feat.

With the latest positive results and de-risking initiatives, it’s no surprise Critical Elements continues to be invited back to Japan to meet with various end users that management expect will be key in funding the Company into production.

Click here to read full news release.

- Arial Cobangbang
- Jeff Walker

Wednesday, 13 August 2014

FLYHT Q2 Conference Call – CEO Expects Strong Second Half


On this morning’s FLYHT second quarter conference call, CEO Bill Tempany addressed a number of topics and questions around the release of Q2 financials and business activities. Right out of the gate, Mr. Tempany commented on the weakness in revenues experienced in Q2. Quarterly revenue was $1.5 million, down 30% from last year’s Q2 results of $2.2 million. The company however, is ahead of Q1, which would indicate it is headed in the right direction. Recurring revenues increased slightly to ~$893,000 from last year’s ~$846,000 and it was explained that this should improve in Q3 as customers that had been shut off due to nonpayment have restarted and a customer in the middle of a fleet switch is up and running again.  

Mr. Tempany noted that in Q2/2013, the company recognized significant orders from First Air and NetJets, which accounted for the strong second quarter in 2013. He emphasized that the third and fourth quarter of this year are looking to be very strong as the company has shipped more AFIRS units in July than in the entire second quarter.

Throughout the call, Mr. Tempany addressed a number of other items:
  • He believes FLYHT is on track to be operations positive (EBITDA with IR and share based compensation removed) by the end of 2014.
  • The company has approximately $5 million in modified working capital.
  • The settlement with Sierra Nevada Corporation (SNC) has allowed the company to eliminate nearly $2 million in debt. The SNC relationship opened a new market to FLYHT. SNC will lead sales in the United States and NATO military and government manned and unmanned aircraft markets.  
  • An initial regulatory report on aircraft tracking by the International Civil Aviation Organization is anticipated in late September and FLYHT will ensure it meets regulatory requirements as they are developed.
  • On the sales front, there has been a great deal of activity in Asia. The company has hired a Singapore based sales person based on identified opportunities in the region. FLYHT is planning to add one or two full time sales positions.  
  • The company is in discussions with Bombardier and other OEM’s with the objective of having AFIRS become a standard feature on aircraft.
  • Mr. Tempany expressed that although its L-3 relationship has been successful and a good one, he believes that FLYHT does not require a third party to gain direct access to manufacturers. He is confident that the company is at the point where it can have those conversations directly with the manufacturers.
  • When asked about progress in China, Mr. Tempany stated that FLYHT has already shipped 50 units and that the Company is the only certified Iridium provider in China.
  • The company in Q2 launched FLYHTSafe, a new safety notification solution. Investors should expect to see more service add-ons being launched in Q3 & Q4, which will improve efficiencies and communications for aircraft and allow FLYHT to earn additional usage fees.
  • In regards to the increase in expenses, it was explained that there will be a continuation of Investor Relations efforts focusing on U.S. and International investors and the company has experienced an increase in travel expenses as a result of ensuring that FLYHT has a presence at all the industry related meetings. Also, the reported R&D spending is a result of the continuation of securing AFIRS 228 Supplemental Type Certifications, which will continue for at least three years.  

To listen to the conference call, please click here.

Self-Storage REITs – Capitalizing On A Multi-Billion Dollar Sector


The growth in self-storage facilities has been well documented and is well known to North Americans.   Driven by life changing events (birth, death, marriage, divorce, career transition, wealth accumulation, etc.), the need to “hang on” to personal items has lead to an incredible demand for storage space.

As pointed out in a recent Bloomberg article, self-storage facilities used to be considered an obscure asset class in the real estate sector. Now, this asset class is a top performer and is gaining popularity among North Americans as an alternative investment to equities and bonds.   In particular, the hottest Real Estate Investment Trust (REITs) are the self-storage trusts.

We’d like to point out that the appeal of self storage and its attributes as a long-term investment is what attracted us to Less Mess Storage (LMS – TSX V), which is a recent client of The Howard Group. While the company is in its early days following the acquisition of two modern self-storage facilities in Poland and three in the Czech Republic, the fact remains that management is focused on asset and cash flow growth. Pro-forma EBITDA in 2013 was just over $2 million with just over 10 million shares issued. The stock last traded at $0.85.

While Less Mess is not at the point where it can consider a dividend or REIT structure as it will be using cash flow for growth, introducing yield into the future is a management objective. The point is that LMS has a solid base on which to positively influence future valuation.  Less Mess is focused on Central and Eastern Europe (CEE) as it is still relatively uncharted territory for the self-storage business compared to North America or the United Kingdom. The fact is that Poland and the Czech Republic have strong economies. Less Mess has become the largest self-storage chain in the CEE with the five-store acquisition and believes it is just scratching the surface.

To provide a perspective on the future, we just need to look at the United States where the self-storage industry grew from 27,500 facilities in 1998 to 52,000 in 2010, housing an estimated 25 million units.  This generated an estimated $24 billion in revenue last year.  Given its low overhead and initial set up costs, entrepreneurs are driven to invest in this lucrative and fast growing sector.

Early REIT investors have been well rewarded, as self-storage assets have thrown off massive amounts of cash flow, the bulk of which has been returned to people who saw the opportunity for sustained growth. In keeping with that theme, we encourage people to appreciate what Less Mess Storage has already accomplished and what it could become in the future.

Click here to read the article on Bloomberg.

To gain further insights into Less Mess Storage, please read the introductory blog prepared by the Howard Group and posted on The Howard Group Insight Live Blog – please click here.

Click here to enlarge below chart for Bloomberg’s Best Performing Alternative Investments.

Click here to view larger

Carfinco – Q2 Results Reported With Record Loan Originations

Carfinco has just released its second quarter results and reported loan originations have reached a record $54 million, up nearly 20% from the first quarter of 2014.  This significant increase is attributed to a heightened focus on customer service to its dealership partners as well as expanding the financing products available to those dealerships as well as the addition of its U.S. operations.

  • Earnings per share for the quarter of 20 cents;
  • Dividends to shareholders of 12 cents per share;
  • Return on shareholders’ equity of 30.1%;
  • Return on portfolio assets of 8.7%;
  • Revenue of $24.3 million;
  • Record loan originations of $54.0 million;
  • Record finance receivables of $252.1 million; and
  • 31+ day delinquent accounts for the second quarter of 2014 were 3.5%.
Net earnings and revenues also increased over the same period in 2013 while the annualized loss rate decreased from Q1 to 14.6% from 15.2%, in line with the Company’s expectations, which range between 13%-16%.

A live conference call will be held today, Wednesday, August 13, 2014 at 11:00am MT (1:00pm ET) and will include a discussion by management about Carfinco's second quarter results followed by a question and answer period. Participants can access the conference call by phone within Canada and the U.S. by dialing the following numbers:

North America Toll-Free:                1-866-233-4585
Internationally:                             1-416-640-5946

Callers should dial in five to ten minutes prior to the scheduled start time.  An audio replay may be accessed through the Investor Relations section of our web site at shortly after the conclusion of the conference call.

To view full news release, please click here.

Monday, 11 August 2014

Argex CEO Roy Bonnell Presentation At Jefferies Conference Now Available Online


This morning, Roy Bonnell was in New York City to present at the 10th Annual Jefferies Global Industrials Conference. The conference consists of over 200 companies presenting and is expected to attract more than 1,500 attendees. This conference features a wide range of public and private companies across many industries that include: Automotive, Building Products/Materials, Chemicals, Mining, etc.

During the presentation, Mr. Bonnell reviewed the TiO2 industry, Argex’s proprietary extraction process and its benefits. He additionally provided insight into the company’s progress towards production. Here are a few key highlights: 

  • Ti02 industry is a $16 billion market.  There is 5 million tonnes worldwide annual demand.  Current TiO2 price is approximately $3,400 per tonne.  
  • Argex’s proprietary process uses lower quality, less expensive feedstock (ilmenite) and is able to sell the byproducts, unlike current industry processes.
  • World TiO2 price is expected to increase along with the standard of living in countries like China and India.   Argex can produce high quality TiO2 at a significantly lower price than other chemical companies.
  • When asked about how Argex has been received by the TiO2 industry. Mr. Bonnell expressed that there is a “Burning desire on the part of the end users for options in terms of TiO2 .”
  • Argex is accepting bids from EPC firms for construction of 1st plant to produce 50,000 tons per year.
  • Mr. Bonnell also expressed that the company is in the, “Latter stages of completing project financing on our first industrial sized module.”

At the conclusion of his presentation Mr. Bonnell expressed, “We will be, hopefully very soon announcing the start of construction of a 50,000 tonne module which will demonstrate the technology and the economics on an industrial scale.”

To listen to an online archive of the presentation, please click here.

- Brad Dryer
Dave Burwell

Thursday, 7 August 2014

CEMATRIX Releases Q2 Results


CEMATRIX released its second quarter financial results this morning for the period ending June 30, 2014. Sales increased 10% over last year, reaching $3,070,504 with gross margin also slightly up over the same period year over year. Over the second quarter, the company added $1.3 million of sales orders bringing the annual amount of work under contract for 2014 to $4.5 million.

The six month reporting compared to last year saw net revenue decrease by roughly $1.5 million.  This decrease can be attributed to an extraordinary Q1/13 that saw a number of 2012 projects extended into and completed in the new year.

The release also highlights management’s positive outlook for the rest of 2014, citing anticipated growth in Canadian and U.S. infrastructure sales as well as continued growth in the Western Canada oil and gas sector. In addition to the $4.5 million of work contracted for 2014, numerous other bids have been placed on projects that, if won, will result in additional work to be completed in 2014.

To view CEMATRIX’s news release, please click here.

- Brad Dryer
Jeff Walker

Critical Elements Strengthens Board of Directors


As part of The Howard Group’s due diligence, we always look at the people behind the company before we invest and/or engage with the company to become an HG client. Experience, background and track record of success are key points of consideration.

Critical Elements’ management team was a key  factor leading to  our involvement and investment.  On that note, it was announced today that the board is gaining a key new member, which could be instrumental in assisting near term opportunities through negotiations with potential off-take customers.

The Company announced that it has added Mr. Matthew Lauriston Starnes as a director of the Corporation.
Mr. Starnes’ impressive background and experience include: 
  • Serving as legal counsel for one of the biggest Japanese trading houses (Sumitomo Corp’s Mineral Resources Division) in Tokyo.
  • Extensive experience with contract negotiations with Japanese lenders and off take agreements with buyers worldwide.
  • Practiced as a corporate lawyer for major law firms in Montreal.
  • Expertise in good governance procedures, taxation laws, civil law, common law, arbitration, government relations and permitting.
  • Japan-based and very familiar with Japanese culture and mindset.
“With his many years of experience, Matthew Starnes will bring experience in legal matters and governance to Critical Elements Corporation,” said Jean-Sébastien Lavallée, President and Chief Executive Officer.

Click here to see the news release.

- Ariel Cobangbang
Jeff Walker

Wednesday, 6 August 2014

Financial Post Article ‘Five Mega Trends That Will Shape the Future of Investing’


An article published in the Financial Post late last week identified five mega trends outlined in a report published by the Bank of America Merrill Lynch that will shape the future of investing.  In it, the article talks about five themes namely:
  • Earth (steady depletion of basic resources such as food, water and energy)
  • Innovation - genetics, robotics and automation (displacement of traditional brands)
  • Shift in global demographics (aging population, income gaps, growing middle class)
  • Impact of government regulations on equity markets (excessive regulation could discourage investment decisions)
  • Impact of rising interest rates (unpredictability/volatility of interest rates makes it challenging to maintain a portfolio)

The article suggests investors should realize that along with these challenges are opportunities that come with it as well – specifically in the agri-tech sector.  With only a select group of companies that possess disruptive technologies in the areas of “precision agriculture” and “genomic-enabled modified crops”, investors should take note that these advances should help dispel concerns and realize that these companies are poised to address the challenges and capitalize on future growth opportunities.

Clean Seed Capital Group is one of these companies capable of reaping the benefits of its proprietary disruptive technology and is intended for investors who appreciate the blue-sky potential in this sector.

Click here to read the Financial Post article (published on July 31, 2014)

To gain further insights into the Clean Seed Capital Group, please read the introductory blog prepared by The Howard Group and posted on the Howard Group Insight Live Blog – click here

Tuesday, 5 August 2014

Critical Elements Achieve 99.98% Battery-Grade Lithium Carbonate Purity


Management of Critical Elements has spent significant time working with potential buyers of battery grade lithium globally, especially in Asia, and today’s news of impressive recovery rates and the ability to produce the high purity, battery grade lithium carbonate should be music to the ears of potential buyers who desperately require a long term source to meet the growing demand.

Since Tesla’s announcement of the upcoming construction of its Gigafactory, along with the recent acquisition of Rockwood by Albemarle, lithium has been in the limelight as the key to the future growth of hybrid and electric car production.  Battery manufacturers have been aggressively securing sources of supply for lithium, as there appears to be a shortfall in global supply as early as 2015.

A key piece of news came today from Critical Elements, proving to potential buyers that the Company can safely produce lithium carbonate with an overall recovery of rate of up to 96% and can achieve purity of 99.98%, surpassing the requirements needed to produce battery grade lithium carbonate that the battery manufacturers are looking for.  The results were achieved by utilizing the sodium carbonate alkaline process considered to be more environmentally friendly then other avenues of production.

Other current testing includes proving the possibility of producing lithium hydroxide from lithium carbonate to see if an integrated production system can be achieved for the two lithium products.  This would allow Critical Elements to capitalize on other market opportunities if it so chooses.

Another component of this test is to identify the recovery of by-products such as alumina (as alumina tri-hydrate – ATH); considered to be in great demand as a fire retardant.  Each extra by-product that can be recovered improves the bottom line in production.

Jean-Sébastien Lavallée, President and CEO was quoted as saying,  “The optimization phase is a crucial step before the final feasibility plant design and we will be continuously testing to ensure Management controls, to the best of our abilities, the different potential obstacles that can occur ramping up the plant into production.”

To view the news release, please click here.

- Jeff Walker
Arial Cobangbang

Thursday, 31 July 2014

YANGAROO Featured In Major TV Industry Journal


Earlier this week, YANGAROO president of advertising Sarah Foss was interviewed in the weekly industry trade magazine Broadcasting & Cable (B&C). Based in New York City, B&C is the leading publication in the television industry, serving more than 23,500 subscribers.

The article highlighted a number of the major competitors and issues facing the industry. Foss stated, “The No. 1 conundrum hitting clients on both sides of the equation, agencies and media companies, is how to handle video in an omni [or multi-platform] environment.” She went on to say, “Right now many people do not have effective systems and have to deal with things manually.”

She further explained how YANGAROO tackles this issue head on with its Digital Media Distribution System (DMDS), which allows both agencies and media companies to streamline their processes in its cloud based multi-format environment.

Foss stated, “Yangaroo sees itself as the filling in the Oreo cookie between agencies and media companies, using a cloud-based platform to streamline the delivery and management of ads from the agencies, deep into the infrastructure of the media companies. Deployments at two networks have already made their ad infrastructures much more efficient”.

Click here to link to the B & C website. To view the article, readers must pay for a subscription.

Tuesday, 29 July 2014

LVFH Signs LOI For Massive Online Gaming Operation In Mexico


Las Vegas From (LVFH), along with gaming industry heavy-weight Codere Group and Mexico's second largest mass media company Azteca, announced that the three companies intend to join forces to create one of Mexico's only legal online gaming portals. The parties have agreed to sign definitive agreements on or before September 15, 2014. 

The website, with other "sister" sites, will offer Mexicans the ability to play popular casino games such as poker, black jack, bingo, playbook and more. The websites will leverage LVFH's proprietary gaming platform, which allows users to play across all platforms and devices including PC, Mac, iOS and Android devices. Another feature is that it allows Mexicans to gamble using Mexican Pesos and "local payment options."

Investors should take note of the quote from Jake Kalpakian, President and CEO of LVFH. He states, "It is anticipated that the revenues that shall be generated from this partnership shall enable LVFH to be profitable."

Also in this release, LVFH declared that it will be required to contribute $4 million in cash to the new company that will be established by the three partners. LVFH stated that in order to contribute this amount the company will use cash on hand, rely on the exercise of warrants and leverage a small private placement.

To view today's news release, please click here.

Monday, 28 July 2014

Harvesting A Yield Of Disruptive Technologies

The Howard Group Introduction to 
Clean Seed Capital Group (CSX:TSX-V)

This story is one to which investors can relate and appreciate, as it combines technology with the never ending need to feed a growing number of people. We simply accept as fact that technological advances have propelled dramatic increases in productivity and efficiency while driving down costs in all industries. 

The first records of early farming date back to 10,000 BC.  It is a profession that involves a lot of trial and error, failure and success, and a never ending quest to “find a better way”. 

With so many agri-tech companies promoting the latest technologies to boost yields and promote sustainability of agriculture, how does one leap ahead of the pack? How does a Western Canadian based emerging company compete against the multi-national farm equipment manufacturers? Most certainly, you can’t outspend them to grab market share that they have taken decades to develop. Most certainly, they are going to look at the “start-up” as a minor irritation UNLESS you have something they need to defend their own turf and grow their market share.

In our view, and irrelevant of the industry, a company that is going to attract real interest from the dominant organizations within a sector must have an Intellectual Property (IP) portfolio that holds the promise of creating  “disruptive advancements”. Another aspect to consider is whether or not the IP is of such merit that it has the potential to impede the Research & Development efforts within the conglomerates. Also, a point not to understate is that a major company may be called to action simply because of a fear that a competitor might want the IP portfolio.  

At this juncture we’d like to introduce Clean Seed Capital Group as the newest addition to The Howard Group client portfolio. It is an agri-tech company that has developed “no-till SMART seeding technologies”. It was first brought to our attention by EuroPacific Canada and subsequently by Industrial Alliance.

Over the past nine months we have had a number of meetings, detailed discussions and a considerable exchange of information with members of management.  In our view, Clean Seed’s IP portfolio is the cornerstone of its business.

We don’t see Clean Seed as a sales and revenue growth business “on its own”. We believe the opportunity is through management’s ability to leverage its IP portfolio with a large industry partner. Clean Seed has been designed for a Joint Venture or buy-out.

 Click for larger image

We clearly understand that if a JV or buy-out was to occur, how long would it take and how would it be structured? What if Clean Seed had to go at it alone? These are just some of the many questions to which there are no answers, today. 

Anyone showing an interest in Clean Seed will look at what has been accomplished versus risks, such as the company’s financial and human resources, and then assess “what may happen” to ultimately draw their own conclusions on valuation and “potential”.   

The Howard Group made its decision and it is an investor in Clean Seed Capital Group.  

Of monumental importance, especially in an emerging company, are the qualities, commitment and depth of the team. For the purposes of this introduction we cannot get into a detailed discussion regarding every individual. However, we want to point out that President and CEO, Graeme Lempriere is “all in”.

The idea for what eventually became Clean Seed was germinated by his father, Dr. Noel Lempriere, approximately 14 years ago.  After ill health became an unfortunate reality for Dr. Lempriere and new challenges in the capital markets surfaced, his son took over the business, but only after rescuing the assets (IP) with his own cash, seeing the company through a financial drought, and then assuming responsibility for making the dream a reality. 

The Lempriere family has many years and more than $3 million invested in Clean Seed. Graeme has also just become a father for the second time.     

Management and members of the Board of Directors own approximately 37% of the 33.25 million shares outstanding (43.54 million fully diluted). Clean Seed began trading on the TSX Venture Exchange in September, 2011. 

Click for larger image

Clean Seed has been winning awards and accolades at major Canadian agricultural and progress shows for its technological innovation, and is now at the front end of full commercialization. Headquartered in Burnaby, British Columbia, the company, through its proprietary SMART technology, has developed a new class of high-resolution seeding equipment called SMART Seeders.  The CX-6 Smart Seeder is the company’s flagship product and represents a radical advancement in seeding technology, providing farmers with total control to implement precise planting plans.  

Think of two people standing in front of a canvas. One has a roller and one has a delicate paint brush. It’s clear which of the two is going to produce a beautiful portrait. Placing just the right amount of paint in exactly the right spots is critical to creating a masterpiece. This is akin to Clean Seed’s technology, but unlike the artist, the canvas of land will reveal a portrait in an incredibly short period of time.

Click for larger image

Amongst many other features, the technology’s ability to read the “map” of a field leads to micro-management of every acre, where just the right amount of seed, fertilizer and inoculants (promotion of plant health) are modified on a millisecond basis. As the graphic notes, “pinpoint accuracy in every square foot on the field”.

Clean Seed views the Canadian prairie farmer as its primary target market. 14,000 air seeders are currently in use in the Northern Great Plains Area, which is the area between Canada and United States, none of which provide individual point resolution for precision metering.
  • Air seeders are suitable for farms with areas greater than 1,500 acres
    • In 2011 there were approximately 12,500 farms in Saskatchewan greater than 1,600 acres
    • 12,000 farms in Manitoba and Alberta were greater than 1,600 acres
  • Potential for the CX-6 Smart Seeder is approximately 24,500 farms (average drill value: $350K for current air seed models) – potential market size of over $8.5 billion
  • Average equipment turnover period is 5 years = annual potential market of $1.7 billion
(Source: Company Material)

Another reason that attracted us to Clean Seed Capital is management’s ability to raise funds in these challenging market conditions, especially for small/micro cap companies.  Due to the successful showing of its CX-6 Smart Seeder at last month’s (June) Farm Progress Show and a growing mountain of interest in the technology, the company decided to scale back a very recent $0.60 Unit financing  to just $1.5 million from $5 million. This decision was taken as Clean Seed is currently evaluating new synergistic business development opportunities.

Clean Seed also has a very strong rural investment base. The fact is that the people who are using the currently available seeding equipment see the potential of this technology and have invested their own hard earned capital. 

The Howard Group will have much more to say about Clean Seed, the people, the technology, and the path forward when it releases its detailed “Perspective” on the company. 

In closing, Clean Seed Capital is designed for people who appreciate the blue-sky potential of what could be a disruptive technology, while understanding the risk-reward balance that needs to be considered in any potential investment.

Should you wish to receive future commentaries from The Howard Group on CSX, click here to register or send us an e-mail at

Click here to see a video of Clean Seed at the Farm Progress Show last June 2014

To view, Clean Seed Capital’s corporate presentation, click here.

Arial Cobangbang
     Grant Howard     

Tuesday, 22 July 2014

Second Malaysian Airline Tragedy Renews Focus On FLYHT Aerospace Solutions Ltd.


FLYHT CEO, Bill Tempany, was in the spotlight today with an appearance on the Canadian network 'CTV Morning Live' to discuss the company’s technology in light of the recent downing of Malaysian flight MH17 over Eastern Ukraine.

While there was significant global media focus on the attributes of the company’s AFIRS technology following the March disappearance of MH370, additional questions have surfaced about what answers may have been provided in the most recent tragedy if the aircraft had been equipped with the system.

To view the interview with Mr. Tempany, click here.

Tuesday, 15 July 2014

Global Maxfin Reiterates STRONG BUY With A $1 Target For FLYHT With Update


In acknowledgement of the news issued today by FLYHT on the certification of the AFIRS 228S for A320 Aircraft, Global Maxfin analyst Joe MacKay issued an update to clients. In the report Mr. McKay says the implications of this announcement are positive for FLYHT.  Specifically stating “the process to certify AFIRS with Airbus has been underway since 2012 and was recently approved by Airbus. L3 is the world’s largest manufacturer of flight data recorders. Under the agreement with L3, L3 manufactures and installs the AFIRS units on the aircraft with FLYHT receiving a royalty payment of approximately $6,000/unit for a retrofit and $12,000/unit for a factory fit.”  

Further into his commentary he also points out that, under the L3 agreement “FLYHT then has the opportunity to sell applications and services to the end user, receiving 100% of the monthly recurring revenue.”

To receive a copy of the update please contact Global Maxfin analyst Joseph MacKay at (416) 741-1544.