Q2 2024 Letter to ShareholdersWe have reached an exciting and critical juncture in the 25-year history of FLYHT Aerospace Solutions. After years of hard work, the development of the AFIRS Edge+ is functionally complete. This milestone represents a significant achievement for our team and our company. As we move forward, we must now sharpen our focus, energy, and resources around sales of the Edge to new and existing customers and to achieving positive EBITDA on a sustainable basis. There is both an opportunity and an imperative to retool the organization to focus on delivery of the promised returns to all our stakeholders while achieving significant cost savings.
We are in a position to make this organizational change because we have substantially completed what we set out to do with the Edge: develop an industry leading 5G compatible wireless QAR (WQAR) and aircraft interface device (AID). We are releasing the 4MCU plug-in-replacement version, the Edge+, which we believe addresses the present and future requirements of the global airline community. The Edge+ is a world class ‘plug and play’ version which we believe will rapidly penetrate the market. Thus, now is the time to take a pause on incremental development and to allow our sales efforts to catch up with the product and its current capabilities.
This R&D pause does not in any way impact our array of established businesses which are successfully supporting over 100 global customers, and which are contributing positively to EBITDA. On the contrary, our strengthened financial position improves our ability to respond to specific customer-requested enhancements of our products. It also allows us to shift our primary focus to securing additional regulatory approvals. We have already completed two Supplemental Type Certificates (STCs) in Canada and have a clear path to obtaining additional certifications for both the Airbus A320 and Boeing 737 aircraft families which represent the most popular aircraft types in key global markets.
We have a large and promising pipeline of commercial opportunities with airline customers supporting these efforts. Regionally, we are concentrating on Europe and China, two of the largest markets where the need for a replacement wQAR/AID is greatest. To further support our sales efforts, we are also looking to expand our channels to market, leveraging the experience of our world class commercial sales team, thereby replicating our success with our OEM partner for the AFIRS 228.
While the Edge is our flagship, we are making significant progress in our other divisions. Our weather solutions continue to expand with the receipt of an additional purchase order from the U.S. National Oceanic and Atmospheric Administration (NOAA) for the FLYHT-WVSS-II humidity sensors. Notably this purchase order includes orders for the Edge as a part of the integrated solution set. Our expanding relationships with NOAA and the UK Met Office validate the growing importance of aircraft-based observations (ABOs) provided by these sensors in improving weather forecasting and in supporting the ability of the aviation community to meet its climate change 2050 target.
Our European division, CrossConsense, continues to win new Maintenance Repair Organization (MRO) business by consistently achieving superior customer satisfaction of its existing base. We are looking at ways to expand this business by providing 24-hour, worldwide support.
As you can see, our sights are set squarely on driving revenue growth and realizing positive EBITDA. To achieve this, we are taking a two-pronged approach: cutting costs where we can and implementing a plan to convert our sizeable pipeline to sales. Unfortunately, fallout from these actions involves parting ways with team members who have played critical roles in getting us to where we are today. Their individual contributions cannot be overstated, and I want to express my sincerest gratitude for their performance and commitment to FLYHT.
We are also making an important change to the CEO position to ensure that FLYHT has the right leader to take the Company into the next phase of its growth. I will be assuming the role on an interim basis while the Board initiates a search to identify a permanent CEO for the Company. We owe our heartfelt gratitude to Kent Jacobs for his dedicated service to FLYHT over the past 23 years, and in particular for leading the company over the past two years as we have completed the development of the AFIRS Edge. The next leader of FLYHT will share our deep commitment to creating and delivering value to our shareholders by accelerating the commercialization of the AFIRS Edge and bringing us to profitability and positive EBITDA on a sustainable basis.
We enter the next chapter of FLYHT on solid footing, with a world-class portfolio of products and solutions. And now, going forward with this sharpened focus and the implemented organizational changes, I believe we are set up for the financial success we have been promising.
Yours truly, Mary McMillan Interim CEO and Executive Chair of the Board