Hill’s distinctive approach to funding for the HX50 and GT50 programmes has been key factor in the company’s success. Given the interest from our customers and industry onlookers, we thought is useful to provide this explanation of the strategy and how it supports the next phase of Hill’s growth as we move from development into production.

Our financing strategy, which has remained consistent since our launch in July 2020, combines the use of government grants, vendor financing and traditional asset financing, customer deposits and reinvested profits.  It has funded aircraft development to date and the initial build out of our production facilities, and enabled the business to become fully funded through to the start of production. 

A second important element of our financing approach is the contractual payment structure under our aircraft sales contract which guarantee strong cash flows through a non-refundable deposit, a 12-month pre-payment and a 3-month pre-payment. These payment terms provide working capital to support the early expansion of production and increase naturally ad production volumes grow.

The third element is the ability to leverage our substantial order book to access conventional third-party finance on attractive terms. This is one reason we have invested significantly in building the Hill brand, communicating our progress and developing a strong global sales pipeline throughout the programme.

We already operate from our own manufacturing facility.  Production Centre One has the capability to manufacture and build GT50 and HX50 for customer delivery, albeit at lower volumes than our significant order book now demands.  

Our intention remains to grow organically wherever this represents the best option, while retaining the ability to deploy third-party capital where doing so enables us to accelerate production, strengthen our infrastructure and better serve our present and future customers.  

The sales promotions that we announced recently illustrate this strategy by creatively accessing alternative sources of early-stage finance as we prepare for scale-up.  Maintaining this flexibility allows us to balance growth, financial efficiency and the long-term interests of both the company and its customers.

At the heart of our strategy is a simple idea: the significant unmet demand for better and more cost-effective aircraft created an opportunity to involve customers directly in bringing a new generation of aircraft to market.  This has provided Hill with an alternative source of early-stage development funding from people whose interests are closely aligned with the long-term success of the programme — our customers – enabling the company to grow organically while maintaining its independence, vision and values.

Mirroring our production strategy, Hill has vertically integrated an important part of the financing model.  By bringing customers, development and production economics closer together and eliminating middlemen, we have reduced the cost of capital and delivering the benefits through lower cost aircraft directly to the people that were prepared to back us.