Core Viewpoint - Vision Marine Technologies Inc. is consolidating its Nautical Ventures dealership operations in North Palm Beach, Florida, to enhance operational efficiency while maintaining customer service in the largest recreational boating market in the U.S. [1] Group 1 - The company has sold the property of the Nautical Ventures dealership located at 300 U.S. Highway 1 in North Palm Beach, Florida [1] - The consolidation will involve merging operations into a neighboring water sports showroom at 139 Shore Court [1] - This strategic move aims to streamline operations and improve efficiency within the Nautical Ventures retail network [1]

Core Insights - Vision Marine Technologies Inc. has announced the world debut of the E-Motion™ 180E electric marine powertrain system in collaboration with Sterk Boats, marking a significant advancement in high-voltage electric propulsion systems [1] Company Developments - The premium Sterk 31, which utilizes the E-Motion™ 180E system, will be launched as the Sterk 31e and will be showcased in-water at the 2025 Fort Lauderdale International Boat Show (FLIBS) from October 29 to November 2, 2025 [1]

Core Insights - Vision Marine Technologies Inc. has announced a distribution agreement with Taiga Motors Inc. for exclusive dealership and service provision of electric personal watercraft in major Florida markets [1] Company Overview - Vision Marine Technologies Inc. is positioned at the forefront of high-voltage electric propulsion technology [1] - The company is supported by an award-winning retail network, enhancing its market presence [1] Agreement Details - The agreement with Taiga Motors Inc. represents a significant step beyond a traditional dealership model, indicating a strategic partnership aimed at expanding market reach [1]

Core Insights - Vision Marine Technologies Inc. announced milestone activations for the 2025 Fort Lauderdale International Boat Show (FLIBS) [1] - The company will operate a VIP shuttle service using its electric boats [1] - A reimagined AquaZone™ has been developed in collaboration with AquaBanas and Informa Markets [1] - FLIBS is the largest in-water boat show in the United States, attracting over 100,000 visitors annually [1]

Core Insights - Vision Marine Technologies Inc. has renewed the Executive Employment Agreement with Alexandre Mongeon as CEO, effective immediately [1] - Alexandre Mongeon is a co-founder of Vision Marine and has played a crucial role in its development as North America's first vertically integrated electric propulsion and multi-brand retail marine platform [1]

Core Insights - Vision Marine Technologies Inc. has announced a strategic non-binding initiative with Port de plaisance La Ronde to create a technological and commercial hub for electric boating in Montreal [1] Group 1: Project Overview - The initiative aims to develop an electric boating hub on Île Sainte-Hélène, which is located near Montréal-Trudeau International Airport [1] - The project will include a sales and distribution center, a technical and commercial training platform, and an expertise center [1] Group 2: Industry Impact - The hub is designed to foster the adoption of electric propulsion in the marine industry, indicating a shift towards sustainable boating practices [1]

Core Insights - Vision Marine Technologies Inc. has advanced its Electric Representative Training Program across its Florida dealership network [1] - The first phase of the program has been completed, involving the selection and training of Electric Representatives at strategic locations [1] Company Developments - The company is recognized as a pioneer in electric marine propulsion [1] - Vision Marine operates an award-winning retail network known as Nautical Ventures [1]

Core Viewpoint - Octillion Power Systems has expanded its partnership with Vision Marine Technologies to produce high-voltage lithium-ion battery packs for marine propulsion systems, manufactured at Octillion's Reno, Nevada facility [1][3]. Company Overview - Octillion is a California-based Tier 1 supplier of high-density lithium-ion battery systems, focusing on electrification across various industries including automotive, marine, and energy storage systems [7]. - The company has delivered over 2 million EV battery systems, which have collectively driven more than 4.5 billion kilometers [7]. Partnership Details - Under the new agreement, Octillion will manufacture Vision-branded battery packs specifically for the E-Motion™ 180E electric outboard system, aimed at the U.S. market [3][4]. - These battery packs are designed to withstand harsh marine environments while providing high energy density and durability, suitable for both commercial and recreational use [3][4]. Technological Advancements - The new battery systems will incorporate technological improvements from Octillion's existing product line, including increased power, extended range, and ease of integration [4][5]. - Octillion's manufacturing capabilities in Reno will facilitate faster production and distribution, enhancing the supply chain for Vision Marine Technologies [5]. Market Position - Octillion operates 11 manufacturing facilities across the U.S., India, and China, positioning itself as a leader in the transition to clean energy in electric transportation [5][7]. - The company emphasizes its commitment to providing clients with high-quality, purpose-built power solutions [5].

Core Insights - Vision Marine Technologies is at the forefront of electric marine propulsion, focusing on transforming recreational boating with integrated electric systems and strategic partnerships [1][2] - The company aims to deliver scalable electric solutions that enhance performance and simplicity compared to traditional gas-powered systems [2] Product Development - Vision Marine's flagship product is the E-Motion™ 180E, a 180-horsepower electric propulsion system available in inboard and outboard formats, deployed across over 22 boat models from more than 10 brands [6] - The E-Motion™ Powerpack is a modular propulsion unit designed for pontoon boats, supporting factory-level integration [7] - A new 24-foot electric pontoon developed in partnership with Massimo is being distributed through over 600 dealers in the U.S., marking a significant milestone in Vision Marine's expansion strategy [8] Intellectual Property and Innovation - Vision Marine has filed 15 patents to date, with 12 granted and 3 filed in the last 60 days, focusing on innovations such as overload protection systems and adaptive water pump control [8][9] Strategic Partnerships and Market Focus - The partnership with STERK has led to the integration of Vision Marine's propulsion system into redesigned vessels, emphasizing a collaborative approach to innovation [9] - The company is focused on expanding commercialization of the E-Motion™ platform through OEMs and direct sales, evaluating dealership acquisitions for vertical integration, and growing recurring revenue through rentals and licensing [11]

[Condensed Interim Consolidated Financial Statements](index=1&type=section&id=Condensed%20Interim%20Consolidated%20Financial%20Statements) [Consolidated Statements of Financial Position](index=2&type=section&id=Consolidated%20statements%20of%20financial%20position) As of November 30, 2024, Vision Marine's total assets increased to $13.26 million from $11.42 million at August 31, 2024, primarily due to a significant rise in cash from $63k to $964k Consolidated Statements of Financial Position Summary | | As at November 30, 2024 ($) | As at August 31, 2024 ($) | | :--- | :--- | :--- | | **Total current assets** | 10,555,566 | 8,613,567 | | **Total assets** | **13,257,121** | **11,420,241** | | **Total current liabilities** | 3,664,490 | 7,689,681 | | **Total liabilities** | **4,125,611** | **8,400,254** | | **Total shareholders' equity** | **9,131,510** | **3,019,987** | | **Deficit** | (67,203,876) | (65,609,357) | - Cash increased significantly to **$963,580** from **$63,126**[3](index=3&type=chunk) - Trade and other payables were more than halved, decreasing from **$4.50 million** to **$2.06 million**[3](index=3&type=chunk) - Derivative liabilities (current and long-term) saw a major reduction from a combined **$2.18 million** to **$370k**[3](index=3&type=chunk) [Consolidated Statements of Changes in Equity (Deficit)](index=3&type=section&id=Consolidated%20statements%20of%20changes%20in%20equity%20%28deficit%29) For the three months ended November 30, 2024, shareholders' equity increased from $3.02 million to $9.13 million, primarily driven by $7.58 million raised from securities issuance Consolidated Statements of Changes in Equity (Deficit) Summary | Description | For the three-month period ended Nov 30, 2024 ($) | | :--- | :--- | | **Shareholders' equity, beginning of period** | 3,019,987 | | Total comprehensive loss | (1,602,337) | | Securities issuance, net of transaction costs | 7,438,849 | | Preferred shares converted | 136,689 | | Share-based compensation | 138,322 | | **Shareholders' equity, end of period** | **9,131,510** | [Consolidated Statements of Comprehensive Income (Loss)](index=4&type=section&id=Consolidated%20statements%20of%20comprehensive%20income%20%28loss%29) The company experienced a significant downturn in performance for the three months ended November 30, 2024, with revenues plummeting to $142,411 from $986,392 in the prior-year period Consolidated Statements of Comprehensive Income (Loss) Summary | Metric | Q1 2025 (ended Nov 30, 2024) ($) | Q1 2024 (ended Nov 30, 2023) ($) | Change | | :--- | :--- | :--- | :--- | | **Revenues** | 142,411 | 986,392 | -85.6% | | **Gross Profit (Loss)** | (50,440) | 435,528 | N/A | | **Net Finance Income** | (1,403,947) | (5,224,179) | N/A | | **Net Income (Loss)** | **(1,594,519)** | **1,025,129** | N/A | | **Basic and Diluted EPS** | **(1.97)** | **11.97** | N/A | - The significant positive Net Finance Income in both periods is primarily due to large non-cash gains on the revaluation of derivative liabilities[7](index=7&type=chunk) [Consolidated Statements of Cash Flows](index=5&type=section&id=Consolidated%20statements%20of%20cash%20flows) For the three months ended November 30, 2024, the company used $5.71 million in cash from operating activities, while financing activities provided $6.62 million, resulting in a net cash increase of $900,454 Consolidated Statements of Cash Flows Summary | Cash Flow Activity | Three months ended Nov 30, 2024 ($) | Three months ended Nov 30, 2023 ($) | | :--- | :--- | :--- | | **Cash used in operating activities** | (5,711,105) | (4,104,665) | | **Cash provided by (used in) investing activities** | (8,606) | 11,326 | | **Cash provided by financing activities** | 6,620,165 | 1,576,070 | | **Net increase (decrease) in cash** | 900,454 | (2,517,269) | | **Cash, beginning of period** | 63,126 | 3,359,257 | | **Cash, end of period** | 963,580 | 841,988 | - The primary source of cash was **$6.79 million** from the issuance of Voting Common Shares and warrants[9](index=9&type=chunk) [Notes to the Condensed Interim Consolidated Financial Statements](index=6&type=section&id=Notes%20to%20the%20condensed%20interim%20consolidated%20financial%20statements) [Note 1: Incorporation and Nature of Business](index=6&type=section&id=1.%20Incorporation%20and%20nature%20of%20business) Vision Marine Technologies Inc. primarily manufactures, sells, and rents electric boats, with highly seasonal operations where quarterly results are not indicative of future performance - The company's principal business is the manufacture, sale, and rental of electric boats[10](index=10&type=chunk) - Business operations are highly seasonal. Boat sales are highest in the fourth quarter (June-August), while rentals are highest from May to August[13](index=13&type=chunk)[14](index=14&type=chunk) [Note 2: Basis of Preparation and Going Concern Uncertainty](index=6&type=section&id=2.%20Basis%20of%20preparation%20and%20going%20concern%20uncertainty) The financial statements are prepared under IAS 34, highlighting a material uncertainty regarding the company's ability to continue as a going concern due to recurring losses and negative operating cash flows - **Going Concern Uncertainty:** The company has incurred recurring losses, has a deficit of **$67.2 million**, and negative operating cash flows, which indicates a material uncertainty and raises substantial doubt about its ability to continue as a going concern[17](index=17&type=chunk) - Management's plan to address this includes seeking additional financing from public and private markets. During the quarter, the company raised net proceeds of **$6,786,619** from issuing common shares[19](index=19&type=chunk) - The company implemented two reverse stock splits: a **1-for-15** split on August 22, 2024, and a **1-for-9** split on October 8, 2024[28](index=28&type=chunk) - Adoption of amendments to IAS 1 resulted in the reclassification of certain derivative liabilities from long-term to current liabilities, affecting the presentation for both November 30, 2024, and the comparative period of August 31, 2024[29](index=29&type=chunk)[31](index=31&type=chunk) [Note 12: Long-term Debt](index=18&type=section&id=12.%20Long-term%20debt) As of November 30, 2024, the company's long-term debt totaled $444,159, consisting of term loans with interest rates between 9.44% and 13.87%, and a temporary bridge loan was fully repaid during the quarter Long-term Debt Summary | Debt Component | As at Nov 30, 2024 ($) | As at Aug 31, 2024 ($) | | :--- | :--- | :--- | | Term loans | 444,159 | 458,640 | | Current portion | (106,355) | (101,397) | | **Long-term portion** | **337,804** | **357,243** | - On September 2, 2024, the company obtained a temporary bridge loan of **$270,500** at **30%** annual interest, which was repaid in full on September 17, 2024. The loan incurred a processing fee of **$74,762**[47](index=47&type=chunk) [Note 13: Derivative Liabilities](index=18&type=section&id=13.%20Derivative%20liabilities) The company's derivative liabilities significantly decreased during the quarter, resulting in a total gain of $1.67 million that impacted net finance income, driven by revaluation and conversions of warrants and preferred shares [Warrants Issued to Common Shareholders](index=18&type=section&id=13.1%20Warrants%20issued%20to%20common%20shareholders) The derivative liability for warrants issued to common shareholders was reduced to zero as of November 30, 2024, resulting in a non-cash gain of $30,564 recorded in net finance income Warrants Issued to Common Shareholders Derivative Liability | Description | As at Nov 30, 2024 ($) | As at Aug 31, 2024 ($) | | :--- | :--- | :--- | | Opening balance | 30,564 | 5,558,822 | | Change in estimate of fair value | (30,564) | (7,190,449) | | **Closing balance** | **—** | **30,564** | [Series A Convertible Preferred Shares](index=19&type=section&id=13.2%20Series%20A%20Convertible%20Preferred%20Shares) The derivative liability for Series A Convertible Preferred Shares decreased from $694,232 to $144,247 due to conversions into common stock and a net revaluation gain of $413,296 - During the quarter, **400** Series A Convertible Preferred Shares were converted into **9,877** Voting Common Shares at a value of **$136,689**[61](index=61&type=chunk) - The company recorded a net gain of **$413,296** related to the valuation of these instruments in net finance income for the quarter[63](index=63&type=chunk) [Series B Convertible Preferred Shares](index=23&type=section&id=13.3%20Series%20B%20Convertible%20Preferred%20Shares) The derivative liability for Series B Convertible Preferred Shares significantly reduced from $1.46 million to $226,034, driven by a large revaluation gain of $1.23 million recorded in net finance income - The company recorded a net gain of **$1,229,560** related to the valuation of these instruments in net finance income for the quarter[67](index=67&type=chunk) Series B Convertible Preferred Shares Derivative Liability | Description | As at Nov 30, 2024 ($) | As at Aug 31, 2024 ($) | | :--- | :--- | :--- | | Opening balance | 1,455,594 | — | | Revaluation at the end of the period | (2,019,193) | (4,642,780) | | Accelerated amortization of the deferred loss | 789,633 | 376,598 | | **Closing balance** | **226,034** | **1,455,594** | [Note 14: Related Party Transactions](index=25&type=section&id=14.%20Related%20party%20transactions) The company engaged in significant transactions with related parties, including $2.76 million in R&D expenses and inventory deposits with MAC Engineering, SASU, and paid $454,390 in remuneration to directors and key management - Transactions for R&D expenses & Inventory Deposits with MAC Engineering, SASU, a company controlled by key management, totaled **$2,759,362** for the quarter, a substantial increase from **$791,906** in the prior-year period[70](index=70&type=chunk) Remuneration of Directors and Key Management | Remuneration of Directors and Key Management | Three months ended Nov 30, 2024 ($) | Three months ended Nov 30, 2023 ($) | | :--- | :--- | :--- | | Wages | 356,486 | 502,015 | | Share-based payments | 97,904 | 88,142 | | **Total** | **454,390** | **590,157** | [Note 15: Capital Stock](index=26&type=section&id=15.%20Capital%20stock) During the three months ended November 30, 2024, the company significantly increased its issued capital by issuing 1,198,003 shares through private and at-the-market offerings, raising $6.85 million in net cash proceeds - Issued **377,778** Voting Common Shares in a private placement for **$3.57 million** in net cash proceeds[76](index=76&type=chunk) - Issued **695,583** Voting Common Shares through an "at the market" offering for **$3.28 million** in net cash proceeds[77](index=77&type=chunk) - Issued **124,642** Voting Common Shares in exchange for services (marketing, consulting, board fees) valued at **$591,571**[74](index=74&type=chunk) - A **1-for-9** reverse stock split was implemented on October 8, 2024[78](index=78&type=chunk) [Note 16: Share-Based Payments](index=28&type=section&id=16.%20Share-based%20payments) The company recorded a total share-based payment expense of $138,322 for the quarter, comprising $18,337 for stock options and $119,985 for warrants granted to an underwriter Share-Based Payment Expense Summary | Share-Based Payment Expense | Three months ended Nov 30, 2024 ($) | Three months ended Nov 30, 2023 ($) | | :--- | :--- | :--- | | Stock options | 18,337 | 74,333 | | Warrants | 119,985 | — | | **Total Expense** | **138,322** | **74,333** | - On September 16, 2024, the company granted an underwriter the option to purchase **18,896** Voting Common Shares at an exercise price of U.S. **$11.25** (**$15.29**)[86](index=86&type=chunk) [Note 17: Revenues](index=31&type=section&id=17.%20Revenues) Total revenues for the quarter ended November 30, 2024, were $142,411, a steep 85.6% decline from $986,392 in the same period last year, primarily due to a collapse in boat rental and club membership revenue Revenue Breakdown | Revenue Source | Three months ended Nov 30, 2024 ($) | Three months ended Nov 30, 2023 ($) | | :--- | :--- | :--- | | Sales of boats | 89,031 | 88,093 | | Sales of parts and boat maintenance | 31,361 | 30,497 | | Boat rental and boat club membership revenue | 22,019 | 867,802 | | **Total Revenues** | **142,411** | **986,392** | [Note 20: Segment Information](index=32&type=section&id=20.%20Segment%20information) The company operates in two segments, 'Sale of electric boats' and 'Rental of electric boats', with the Sales segment generating $120,392 in external revenue and reporting a pre-tax loss of $1.61 million, largely due to non-cash derivative gains Segment Performance (Q1 2025) | Segment (Q1 2025) | Revenue from external customers ($) | Segment profit (loss) before tax ($) | Segment assets ($) | | :--- | :--- | :--- | :--- | | Sale of electric boats | 120,392 | (1,610,743) | 21,595,409 | | Rental of electric boats | 22,019 | 48,539 | 1,753,763 | - The pre-tax loss in the 'Sale of electric boats' segment for Q1 2025 includes a gain on derivative liabilities of **$1,673,420**[98](index=98&type=chunk) - For comparison, in Q1 2024, the 'Sale of electric boats' segment reported a profit of **$1,126,640**, which included a derivative gain of **$5,411,168**[98](index=98&type=chunk)[99](index=99&type=chunk) [Note 22: Commitments](index=34&type=section&id=22.%20Commitments) The company has significant future financial commitments, including minimum purchase obligations totaling $3.14 million for fiscal year 2025 and $1.27 million for 2026, along with undiscounted lease commitments for a new premises Unconditional Purchase Obligations | Unconditional Purchase Obligations | Amount ($) | | :--- | :--- | | 2025 | 3,143,058 | | 2026 | 1,272,764 | [Note 23: Subsequent Events](index=34&type=section&id=23.%20Subsequent%20events) After the quarter ended, the company continued its financing activities, issuing 1.92 million shares through its "at-the-market" facility for $5.81 million in gross proceeds and converting all remaining Series A Convertible Preferred Shares - Between Dec 1, 2024, and Jan 9, 2025, the company raised **$5.81 million** in gross proceeds by issuing **1,917,537** shares via its "at-the-market" facility[104](index=104&type=chunk) - On December 21, 2024, all remaining Series A Convertible Preferred Shares were converted into **48,177** Voting Common Shares. No Series A shares remain outstanding[105](index=105&type=chunk)