New Horizon Aircraft (NASDAQ:HOVR) executives used the company’s fiscal third-quarter 2022 earnings call to outline progress on its Cavorite X7 hybrid-electric aircraft program, highlight newly announced manufacturing and engineering partnerships, and discuss liquidity and spending as the company moves toward building a full-scale prototype.
Management: AAM market shifting from concepts to execution
CEO Brandon Robinson said the advanced air mobility (AAM) sector is moving from “a concept-driven phase” toward “practical execution,” where certification pathways, real-world performance, and economic viability are increasingly central. He said Horizon’s strategy remains focused on building an aircraft aimed at “real operational challenges,” with improvements in cost, performance, reliability, and safety across multiple missions.
Hybrid-electric strategy, IFR goals, and operating cost claims
Robinson reiterated that the company’s hybrid-electric architecture—combining a turbine-based power system with electric propulsion—has been part of the design “from the very beginning” and is intended to avoid reliance on ground charging infrastructure. He said the system is designed so the aircraft can operate “independently of any ground charging infrastructure,” and he described the ability to recharge while airborne and after landing as an additional safety factor.
Robinson also said Horizon plans to pursue “full IFR capabilities” as well as “flight into known icing certification,” which he characterized as important for commercial and defense use cases. During Q&A, he emphasized that certifying aircraft for icing and cloud operations is challenging, particularly for aircraft using open rotor systems. He pointed to the company’s previously announced INSAT grant “for up to $10.4 million” tied to anti-icing technologies and said the company is testing coatings and de-icing approaches, including “icephobic coatings” and “electrothermal coatings,” as well as more conventional turbine-engine bleed-air options.
CFO Brian Merker and Robinson both referenced an evaluation performed by an independent audit firm on expected operating economics. Robinson said an audit firm “verified” that the Cavorite X7 is expected to deliver “up to 75% lower operating costs” on a per-mile basis versus conventional helicopters and “some” peer AAM aircraft.
Merker provided additional detail, saying the study resulted in a projected $0.97 cost per available seat mile, which he said compares to peer AAM estimates “in the $3-$5” range and legacy helicopters “in the $4-$7” range. Merker said the analysis incorporated aircraft performance factors including speed, range, and payload, and was intended to provide “substantive corroboration” for prospective customers.
In response to analyst questions about where the aircraft is most differentiated, Robinson said Horizon expects cost advantages versus helicopters to come from being “20%-30% cheaper to operate per hour” while traveling “about 1.8-2 times further” in the same time period due to speed. He also pointed to helicopters’ maintenance intensity, and argued that a hybrid approach benefits from a fuel source he described as “40 times more energy-dense.” Robinson also said Horizon’s design reduces reliance on vertiport charging infrastructure and uses “significantly less batteries,” which he said could be costly in other aircraft.
Partnerships: fuselage, wings, and flight test instrumentation support
Robinson highlighted several partnerships that he said advance the company into the production phase for the full-scale aircraft:
- Rampf Group was contracted to produce the fuselage structure. Robinson described Rampf as an international manufacturer specializing in advanced composites and said the agreement represents a “significant shift into the production” of the full-scale aircraft.
- North Aircraft Industries was contracted to produce the wings, which Robinson said supports performance optimization and production readiness.
- Mitsubishi Heavy Industries RJ Aviation Group (MHIRJ) is collaborating with Horizon to provide specialized engineering support, particularly for “flight test instrumentation,” which Robinson said will be critical ahead of the planned early-2027 flight test program.
During follow-up questions submitted via webcast, Robinson characterized the MHIRJ relationship as “essentially an engineering and expertise partnership” at present, while also noting broader Mitsubishi capabilities and the “potential…for a lot more,” without providing specific future commitments.
Asked what additional collaborations could be next, Robinson said Horizon is in an ecosystem with significant Canadian aerospace capabilities and indicated the company is in discussions with multiple organizations, though he said the company could not announce anything. He also cited flight controls as a major development area, saying the company is “looking to partner with a very significant group for flight control development.”
Financial results: higher development spend, $20 million cash balance
Merker said the company ended the quarter with $20 million in cash. Robinson similarly said the company entered the quarter with approximately $20 million and described a working capital runway “in excess of 12 months” under the current operating plan.
Merker said that “thus far into the year,” the company raised $25 million through a mix of an at-the-market program, non-dilutive grants, and warrant exercises, at an average price of $2.03 per share.
On spending, Merker reported total operating expenditures of $7.6 million for the quarter, up from $3.6 million in the same period last year. He said administrative costs were “largely flat,” while aircraft development costs increased to $4.3 million from $0.4 million a year earlier. For the year-to-date period, he said operating costs rose to $19 million from $10 million, with aircraft development costs increasing to $9.6 million from $1.2 million.
Merker said these aircraft development costs relate to “people, components, and tooling” for building the full-scale aircraft, which he said the company expects to complete by the end of 2026. He also said cash used in operations was $12 million for the nine-month period ended Feb. 28, higher than the prior year due to the increased build investment. Looking ahead, Merker said the company anticipates cash used in operations to remain consistent or “modestly increase” versus fiscal 2026 quarterly run rates through completion of the full-scale demonstrator.
In response to a question about whether there were one-time costs associated with the Rampf or North Aircraft work, Merker said he would not define them as one-time, and that such costs should be expected “until the aircraft’s completed.”
Funding outlook and defense positioning
Robinson said Horizon’s approach is intended to be “significantly more capital efficient than many of our peers,” citing the hybrid architecture, partnerships, and an OEM-focused strategy rather than operating an air taxi service. He also said the company is pursuing non-dilutive funding opportunities similar to prior INSAT grants.
In a webcast-submitted question about runway and dilution, Merker said that based on the current $20 million cash balance and trailing operating cash use, the company believes it has “another one to two years of liquidity.” He added that Horizon is “not…in any hurry to raise funds right now,” while acknowledging the company “won’t have to eventually raise money,” and said it intends to be careful on timing and terms.
Robinson also discussed defense use cases, saying the full-scale prototype is being designed with “defense-specific requirements in mind.” He cited missions such as insertion or extraction without runway infrastructure, casualty evacuation, and supporting sensor payloads due to onboard power generation. He said the company is speaking with “defense prime contractors” and military services about surveillance and payload options.
Separately, Robinson pointed to what he described as favorable policy tailwinds, including Canada’s Defense Industrial Strategy and U.S. Department of Transportation and FAA activity related to eVTOL integration programs. He framed these developments as supportive of the sector’s longer-term integration into national airspace systems.
In closing remarks, Robinson said the company is “advancing towards” completion of its full-scale prototype, expanding its team and partner ecosystem, and continuing to engage potential strategic partners, while emphasizing safety, performance, economics, and operational flexibility as key priorities.
About New Horizon Aircraft (NASDAQ:HOVR)
New Horizon Aircraft Ltd., an aerospace original equipment manufacturer company, focuses on designing and developing hybrid electric vertical takeoff and landing (eVTOL) aircraft for the regional air mobility market in the Uinted States. The company is developing Cavorite X7, a hybrid electric 7-seat aircraft that can take off and land vertically like and helicopter. New Horizon Aircraft Ltd. was founded in 2013 and is headquartered in Lindsay, Canada.
