Firan Technology Group Corporation (TSX: FTG) Q2 2025 Earnings | 07/09/2025

On July 9, 2025, Firan Technology Group Corporation (FTG) held its Q2 2025 analyst call, with President and CEO Brad Born and CFO Jamie Crichton presenting strong financial results and strategic initiatives.

Q2 2025 Financial Highlights:

• Record Sales and Profitability: FTG achieved a new sales record of $48.7 million, marking a 25.6% increase over Q2 last year. This growth was driven by 45% organic growth and 55% from the acquisition of Flight. The company also reported record adjusted EBITDA of $8.7 million (up from $6.5 million in Q2 2024) and a 36% rise in net earnings to $3.5 million.

• Strong Backlog: Total bookings for the quarter reached $45.8 million, resulting in a robust quarter-end backlog of $133.5 million, a 9% increase from the previous year-end. Over $60 million of this backlog is due in Q3 2025.

• Gross Margin Improvement: Gross margin improved to 32.6% in Q2 2025, up from 27.9% in Q2 2024, benefiting from operational improvements (especially in the circuits segment), favorable foreign exchange rates, and contributions from the Flight acquisition.

• Healthy Balance Sheet: FTG maintained a strong balance sheet with net debt of $13.5 million, representing approximately 0.4 times trailing 12-month EBITDA. Operating cash flow for the first half of 2025 was $5.8 million.

Strategic Accomplishments and Outlook:

• Flight Acquisition Integration: The recent acquisition, Flight, achieved profitability in Q2 2025 and secured its first Supplemental Type Certificate (STC) for its Aprils Edge product on the Boeing 737. FTG plans to insource Flight's manufacturing to capture additional margin and mitigate U.S. tariff exposure, although this process has faced some delays due to tariff uncertainties. Flight's new products, including a SATCOM radio (with recurring data revenue streams and expected multi-million dollar uptick from Airbus licensing), a Water Vapor Sensing System (with firm orders and associated data revenue), and a 5G wireless quick access recorder (WQAR), are key focuses for sales.

• Global Expansion with India Facility: FTG finalized design and lease agreements for a new aerospace facility in Hyderabad, India, targeting completion by late 2025. This initiative serves as an insurance policy against potential issues in China operations and provides cost-effective manufacturing capabilities with growth potential in the Indian market.

• Strengthened Leadership Team: The company added Bill Sassati as Executive Vice President of FTG Circuits and Marco Vinica as Executive Vice President of FTG Aerospace, bringing extensive industry experience. Russell Davis also joined the Board of Directors.

• Market Demand: End market demand remains strong across commercial aerospace and defense.

  • Commercial Aerospace: Airbus plans to ramp production significantly with over 8,000 orders in backlog. Boeing is also recovering from past challenges with plans to increase production, holding almost 6,000 orders in backlog.

  • Business Jets and Helicopters: Bombardier secured a new order for 50 aircraft with options for 70 more, and Bell Helicopter and Airbus Helicopters show strong backlogs and growth.

  • Defense: Increased defense spending commitments from NATO members (aiming for 3.5% of GDP plus 1.5% for infrastructure) and U.S. defense budget increases indicate significant future growth. FTG secured new qualification orders for high-volume U.S. defense programs.

• Tariff Mitigation Strategy: FTG is actively managing the impact of U.S. tariffs. They are pivoting non-U.S. customer work to non-U.S. manufacturing sites (e.g., Canada and China) and increasing exposure to Airbus. The Flight acquisition, with its global sales and Canadian customer base, also helps mitigate tariff risks.