Mr. Josh Bruni reports

AMERICAN AIRES ANNOUNCES RECORD Q4 AND ANNUAL 2023 ORDER VOLUME AND SIGNIFICANT Q4 EBITDA PROFITABILITY

American Aires Inc. has filed the company's financial statements and management's discussion and analysis for the year ended Dec. 31, 2023, and has disclosed key performance metrics (non-international financial reporting standards and unaudited financial results). To keep financial results comparable on a year-over-year basis while making them consistent with continuing and future reporting, all figures herein combine the results of American Aires and those achieved by Huck Project LLC, pursuant to the distributor-royalty agreement initially announced on Aug. 28, 2023, and which has been subsequently terminated by mutual agreement of the parties, as announced on Feb. 16, 2024.

The American Aires team is proud of its fourth quarter 2023 performance, achieving record order volume of $3.7-million, largely due to enhancements made to American Aires's marketing and advertising strategy. The increased order volume represents strong growth YoY (up $1.3-million for 53-per-cent growth), while advertising and promotion expenses grew by only a modest $300,000 YoY as it continues to scale up its growth engine, and marketing costs were slightly reduced by 2 per cent YoY.

The record level of quarterly order volume was achieved despite a temporary shortage of product that limited sales. The related supply chain constraint has been resolved, and the company has been fully stocked since that time as a result of the negotiation of new supply terms and increased working capital from its recently closed $4-million financing, as announced on Feb. 16, 2024.

The company's most important quarterly achievement was reporting its first significant adjusted quarterly earnings before interest, taxes, depreciation and amortization profitability at $77,750, which is a milestone that underscores the company's continuing strategic delivery of shareholder value. EBITDA adjustments are for inclusion of Huck results and non-recurring expenses associated with restructuring and other one-time costs.

The American Aires team is equally proud of its annual performance in 2023 on multiple fronts. The company drove an impressive order volume increase of 79 per cent YoY to $10.4-million (up from $5.8-million in 2022). The strong order volume financial results are a direct result of the brand-building vision of American Aires chief executive officer, Josh Bruni, and his ability to consistently drive growth, such as 2022's order volume increase of 128 per cent YoY. As with previous years, the main catalyst for revenue growth was Mr. Bruni's measured, data-driven and iterative growth engine.

Mr. Bruni commented: "This success builds on the hard work and sustainable growth we've demonstrated over the past two years. These financial results are just the latest proof that we have what it takes to reach and convert the massive and growing consumer market focused on well-being and EMF protection. Now it's time to focus on making 2024 our best year ever and continuing our trajectory of significant revenue growth. That means staying the course but with the welcomed advantage of working with a larger budget. That will involve ramping up our predictable growth engine to drive further revenue increases and deepening and widening our relationships with athletes, celebrities and performers to elevate American Aires to the level of household brand."

Gross margin as a percentage in 2023 was mostly in line at 61 per cent relative to from 2022's level (62 per cent), exemplifying continued focus on optimization of manufacturing and fulfilment costs. Gross margin in dollars increased by 76 per cent YoY to $6.4-million (up from $3.6-million in 2022) on the back of stronger order volumes.

The financial results for 2023 demonstrate the effectiveness and return on investment of the company's revamped advertising and promotions approach, which includes expanded spending on social media platforms and further spending on developing affiliate relationships to promote American Aires's products. During the year, advertising and promotion spend increased by only $1.3-million YoY compared with an annual YoY increase in order volume that was 3.4 times greater ($4.6-million).

Marketing expenses remained relatively stable with a modest 8-per-cent YoY increase to $2.1-million. The expenses are based on contracts with a number of marketing agencies that provide services based on a fee as opposed to commissions. As a result, marketing expenses are not expected to increase in the same proportion to sales.

Overhead costs for the year remained flat at $1.9-million. Largely non-recurring legal and professional fees increased mainly related to an increased use of legal firms during the year for capital-raising events and restructuring activities. In contrast, the company diligently drove down office and general costs by 5 per cent and consulting and payroll expenses by 7 per cent, demonstrating it commitment to efficiency and to creating value for American Aires shareholders.

American Aires chief financial officer Vitaliy Savitsky commented: "American Aires is a young high-growth company, so a lot of my focus has been on disciplining growth, measuring effectiveness of ad spend and reducing costs. That strategy paid off tremendously in 2023 with its difficult year in the capital markets. Instead of losing ground, we focused on hitting adjusted EBITDA profitability and on growing sustainably. I'm very excited about scaling up the business in existing markets and expanding internationally in 2024 and beyond with this disciplined approach. That's our strategy and vision for further strengthening our industry leader status and delivering more shareholder value."

Detailed breakdown of preliminary, non-IFRS, unaudited figures

Due to the Huck agreement being in effect since Aug. 28, 2023, and for the entire Q4 2023, the company realized the economic benefit from the sale of its products in the form of royalty and credit reimbursement rather than the typical formula of revenues less cost of goods sold, less advertising and promotion, and less marketing and other expenses. As a result, accounting rules required revenues, COGS, advertising and promotion, marketing, and certain other expenses to be allocated to Huck during this period. The company reported cash royalty income and credit reimbursement income for 2024 in the amounts of $283,427 and $197,183, respectively, or $480,610 combined. Management believes that the overall net income effect of the Huck agreement on the company's bottom line was negligible in 2024 as Huck realized neither profit nor loss from the distribution partnership. However, to keep investors well informed and be able to compare results with prior years and future quarters, since the Huck agreement was terminated as of Jan. 1, 2024, the company is pleased to provide certain relevant metrics on a combined basis, removing the effect of the Huck agreement to demonstrate the true state of operations. More details are available in the attached table.

In addition, the company has also extended its engagement of Clarkham Capital Ltd. to provide investor relations and consulting services with a focus on the German stock market and the German-speaking investor community. The services will include the preparation of articles and coverages on several financial platforms and newsletters. The services will also include the translation and distribution of news releases in Germany. The services commenced on April 11, 2024, and will end on May 11, 2024. The company will pay Clarkham 150,000 euros for its services. The company will not issue any securities to Clarkham in consideration of the services. The company and Clarkham deal at arm's length and do not have any prior relationship.

About American Aires Inc.

American Aires is a Canadian-based nanotechnology company committed to enhancing well-being and environmental safety through science-led innovation, education and advocacy. The company has developed a proprietary silicon-based resonator that protects against the harmful effects of electromagnetic radiation. American Aires's Lifetune products target EMR emitted by consumer electronic devices such as cellphones, computers, baby monitors and WiFi, including the more powerful and rapidly expanding high-speed 5G networks. American Aires is listed on the Canadian Securities Exchange under the ticker WIFI and on the OTC Pink under the symbol AAIRF.

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