L-39

A Czech aircraft manufacturer that has been building military planes for a century just posted the best financial results in its modern history, with profit before tax jumping more than 400 percent in a single year as demand for affordable jet trainers accelerates across defense markets worldwide. AERO Vodochody AEROSPACE, the largest aircraft manufacturer in the Czech Republic, reported 2025 revenues of approximately $295 million, up 8 percent from the prior year, with profit before tax reaching approximately $23 million compared to roughly $4.6 million in 2024, a 402 percent increase. Adjusted EBITDA, a measure of operating profitability that strips out extraordinary and non-cash items, reached approximately $50 million, up 35 percent year on year. The company delivered 14 L-39 Skyfox aircraft to customers during the year, the highest annual delivery total in the program's history, and is preparing to announce new orders that will bring the Skyfox into Africa and North America for the first time. "Year 2025 was an exceptional year for AERO. We achieved a record profit, more than doubled our operating result, EBITDA exceeded the CZK 1 billion mark, and we delivered the highest number of Skyfox aircraft to customers in a single year in the history of the program," said Viktor Sotona, President and Chairman of the Board of Directors of AERO. The Skyfox, formally designated the L-39NG, is a modernized evolution of the legendary L-39 Albatros, the Czech-designed jet trainer that equipped the air forces of virtually every Warsaw Pact nation during the Cold War and remains in service with dozens of military operators worldwide. Hundreds of the original Albatros aircraft are still flying with military customers and aerobatic demonstration teams, a testament to the durability of the basic design. The Skyfox updates that platform with modern avionics, a Williams FJ44-4M turbofan engine replacing the original Soviet powerplant, a glass cockpit, and structural improvements that extend service life and reduce maintenance costs. The result is a capable two-seat jet trainer that competes on price, availability, and support against larger Western programs including the Leonardo M-346 and the Korean Aerospace Industries T-50. The Skyfox program generated approximately $173 million in revenues in 2025, accounting for 58 percent of AERO's total turnover. The armed variant of the Skyfox, which premiered at the Dubai Airshow in November 2025, adds military significance beyond the training role. Configured to carry weapons compatible with NATO standards, the armed Skyfox can perform light attack missions and, notably, airspace protection tasks including operations against unmanned aerial vehicles. That counter-drone capability reflects one of the most rapidly expanding mission requirements across air forces of all sizes, as the proliferation of commercial and military drones creates threats that countries without large interceptor fleets struggle to address with traditional air defense assets. A relatively affordable armed jet trainer that can be directed against drone threats gives smaller air forces a credible response option that a frontline fighter fleet, even where it exists, may be too expensive to deploy for routine counter-drone patrols. AERO's financial performance does not rest on the Skyfox alone. The company's Aerostructures segment, which produces structural components for civil aircraft programs, generated approximately $78 million in 2025, up 24 percent year on year, driven by record production volumes under both its Airbus A220 and Embraer C-390 programs. Under the Airbus A220 program, AERO manufactured and delivered 100 wing leading edge assemblies and was elevated to Tier-1 partner status, meaning it now supplies Airbus directly rather than through an intermediate contractor. That change in supply chain position carries commercial significance beyond the revenue figure: Tier-1 partnerships with major civil aircraft manufacturers provide stable long-term demand, access to development programs at an earlier stage, and the kind of quality certification and process recognition that opens doors to additional programs. The Embraer C-390 component of the Aerostructures segment adds a military dimension to the civil work. AERO delivered nearly seven complete shipsets of structural assemblies for the C-390, a medium tactical transport aircraft that Brazil developed to compete with the Lockheed C-130 Hercules in the medium transport market and has since sold to Hungary, the Netherlands, Portugal, Austria, and the Czech Republic itself. As C-390 sales expand across Europe, the production demand on AERO's structural assembly lines grows with it. The third segment, military maintenance, repair, overhaul, and fleet operational support, generated approximately $48 million in 2025, up 22 percent year on year. AERO completed aircraft overhauls for the Bulgarian Air Force during the year and signed a multi-year contract with the Czech Ministry of Defense for overhauls of L-159 ALCA light combat aircraft in their T1 and T2 variants. The L-159, a single-seat light combat aircraft developed in the late 1990s in cooperation with Boeing, remains the primary fast jet in Czech Air Force service alongside the Gripen fighters leased from Sweden. AERO also continued supporting the fleet operated by Draken International, the American company that provides adversary air and other contract services to Western militaries using a mix of former military jets including L-159 aircraft. Sotona framed the company's three-pillar structure as the foundation for sustained growth rather than a single-cycle performance spike. "AERO today is not just a company with a single product. We have a very strong program built around our own aircraft, stable cooperation programs for global manufacturers, and a steadily growing area of aircraft repairs and modernizations. This combination gives us a strong foundation for further growth and confirms that AERO is back among the respected players in the global aerospace industry," he said. The imminent entry of the Skyfox into Africa and North America, which Sotona flagged as weeks away rather than aspirational, would represent a meaningful geographic expansion for a program that has so far concentrated on European and Middle Eastern customers. In markets where established Western trainers carry premium price tags and long delivery queues, a modern NATO-compatible jet trainer backed by a manufacturer with century-old aviation heritage and a demonstrated support infrastructure offers a genuinely competitive proposition.

L-39

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