Annual Report for Fiscal Year Ending DECEMBER 31, 2025 (Form 10-K)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Management's Discussion and Analysis of Financial Condition and Results of Operations of Premier Holdings. For The Years Ended December 31, 2025 and 2024.

You should read the following discussion and analysis in conjunction with our financial statements, including the notes thereto, included in this Report. Some of the information contained in this Report may contain forward-looking statements within the meaning of Section 27A of the Securities Exchange Act of 1933, as amended (the "Act") and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act").

This information may involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance, or achievements to be materially different from future results, performance or achievements expressed or implied by any forward-looking statements. Forward-looking statements which involve assumptions and describe our future plans, strategies, and expectations, are generally identifiable by the use of the words "may," "will," "should," "expect," "anticipate," "estimate," "believe," "intend" or "project" or the negative of these words or other variations on these words or comparable terminology.

These forward-looking statements are based on assumptions that may be incorrect, and there can be no assurance that the projections included in these forward-looking statements will come to pass. Our actual results could differ materially from those expressed or implied by the forward-looking statements as a result of various factors. We undertake no obligation to update publicly any forward-looking statements for any reason, even if new information becomes available or other events occur in the future.

Going Concern and Liquidity

The Company's financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates continuity of operations, the realization of assets, and liquidation of liabilities in the normal course of business.

Premier Holdings incurred a net loss of $3,865,621 and $2,191,235 during the years ended December 31, 2025 and 2024, respectively. Although these losses were primarily the result of investments in aircraft and supporting operational infrastructure, these losses and limited working capital raise substantial doubt about our ability to continue as a going concern.

There can be no assurance that the Company will be successful in obtaining additional funding, or that the Company's projections of its future working capital needs will prove accurate, or that any additional funding will be sufficient to continue operations in future years. In addition, support of the Company's operations is dependent on receiving support from related parties which primarily consists of financial support for revenue and operating expenses.

We will be required to raise substantial capital to fund our capital expenditures, working capital, and other cash requirements. We will continue to rely on related parties and seek other financing to complete our business plans. The successful outcome of future financing activities cannot be determined at this time and there are no assurances that, if achieved, we will have sufficient funds to execute our intended business plan or generate positive operational results.

In addition to our current deficit, we may incur additional losses during the foreseeable future, until we are able to successfully execute our business plan. There is no assurance that we will be able to obtain additional financing through private placements and/or public offerings necessary to support our working capital requirements. To the extent that funds generated from any private placements and/or public offerings are insufficient, we will have to raise additional working capital through other sources, such as bank loans and/or financings. No assurance can be given that additional financing will be available, or if available, will be on acceptable terms.

We are also incurring increased costs as a publicly traded company. As a public company, we incur significant legal, accounting and other expenses that we did not incur as a private company. In addition, the Sarbanes-Oxley Act of 2002, as well as new rules subsequently implemented by the Securities and Exchange Commission, have required changes in corporate governance practices of public companies. These new rules and regulations have increased our legal and financial compliance costs and have made some activities more time-consuming and costly. We cannot predict or estimate the amount of additional costs we may incur as a result of being a public company or the timing of such costs.

RESULTS OF OPERATIONS

Revenues

Revenues for the year ended December 31, 2025, were $31,877,508 compared with revenue of $20,751,139 during the year ended December 31, 2024, an increase of $11,126,369, or 53.6%.

This growth was driven primarily by strong performance in our core aircraft charter operations. Charter revenue rose by $11,785,580 year-over-year, reflecting higher flight hours, increased aircraft / utilization of our fleet, expanded client demand for luxury private aviation services, and targeted marketing efforts within our broker / retail customer base. The company continues to benefit from robust demand in the private aviation sector.

The overall increase was partially helped in other revenue streams associated with a strategic transition in our business model. Specifically:

	·	Maintenance revenue decreased by $639,127, as we ramped up third-party maintenance services.
	·	Aircraft management fees declined due to the shift from contracted managed aircraft to a leased aircraft model. Under the new structure, the Company now directly controls and operates the aircraft and allows a greater share of the charter revenue generated by the fleet.

This transition is expected to enhance the Company's long-term profitability and operational flexibility by aligning revenue more closely with flight activity and reducing reliance on lower-margin management and maintenance services. As a result, a larger portion of our revenue is now derived from higher-margin charter operations.

The Company anticipates that continued growth in charter demand, combined with the benefits of our optimized fleet strategy, will support further revenue expansion.

Cost of Revenues

Cost of revenues for the year ended December 31, 2025, was $28,486,993, compared to cost of revenues of $18,356,827 during the year ended December 31, 2024, an increase of $10,130,166, or 55.2%.

The increase in cost of revenues for the year ended December 31, 2025 was primarily driven by two factors related to the Company's fleet expansion and optimization strategy:

• Higher costs associated with grounded aircraft undergoing scheduled and unscheduled maintenance, which temporarily reduced aircraft availability for charter operations while incurring ongoing fixed and variable maintenance expenses.

• Operating costs of newly acquired aircraft incurred prior to these aircraft generating meaningful charter revenue. These pre-revenue costs included crew training, initial positioning, insurance, hangar fees, and other preparatory operating expenses.

• Engine reserve costs increased as more flight hours were utilized during the year.

These additional costs were incurred in support of the Company's long-term growth initiatives, including fleet modernization. As these aircraft become fully operational and integrated into our charter fleet, the Company expect improved utilization and contribution to higher-margin revenue in future periods.

Operating Expenses

Operating expenses for the year ended December 31, 2025 were $6,085,952 compared to operating expenses of $3,545,662 during the year ended December 31, 2024, an increase of $2,540,290, or 71.6%.

The increase in Operating Expenses for the year ended December 31, 2025 was driven primarily by higher facility rent and consulting fees. Facility rent rose due to expanded office and hangar space required to support our growing fleet and operations following the transition to a leased aircraft model. Consulting fees increased as the Company engaged external advisors for strategic initiatives, public filings, fleet optimization, regulatory compliance, and support for business expansion in the premium private aviation sector. The Company also incurred $428,998 in rent expense associated with holdover costs for engine overhauls.

These higher costs reflect investments in infrastructure and expertise necessary to scale charter operations and improve long-term efficiency. Despite the percentage increase, operating expenses remain well-controlled relative to the 53.6% revenue growth achieved in the year.

Loss from Operations

Loss from operations for the year ended December 31, 2025 was $2,695,437 compared to net loss from operations of $1,151,350 for the year ended December 31, 2024, an increase of $1,544,087, or 134.1%.

The operating loss in 2025 was primarily driven by costs associated with grounded aircraft undergoing maintenance, engine reserve expenses and operating expenses for newly acquired aircraft incurred prior to these aircraft generating meaningful charter revenue. These included scheduled and unscheduled maintenance, crew training, positioning flights, insurance, and other preparatory costs.

Despite these temporary headwinds, the year-over-year reduction in operating loss reflects strong revenue growth of 53.6% and improved gross profit contribution from higher-margin charter operations. The strategic transition, combined with fleet expansion, continued to pressure near-term results but is expected to drive better aircraft utilization, operating leverage, and reduced losses in future periods as the expanded fleet becomes fully productive.

Other (Income) Expense

Other (income) expenses for the year ended December 31, 2025 was $1,170,184 compared to $1,039,885 for the year ended December 31, 2024, an increase of $130,299, or 12.5%. The other expenses incurred in the year ended December 31, 2025 are primarily attributable interest expense related to aircraft leases and additional debt.

Net Income (Loss)

Net income (loss) was $(3,865,621) and $(2,191,235) for the year ended December 31, 2025 and 2024, respectively. The loss incurred in the year ended December 31, 2025 was driven primarily by higher facility rent and consulting fees as well as an increase in interest expense related to aircraft leases and additional debt.

Cash Flows

		Year Ended
		December 31,
		2025				2024
Net cash provided by operating activities		$	1,152,792			$	3,089,157
Net cash used in investing activities			(2,815,068	)			(928,554	)
Net cash used financing activities			1,650,223				(2,065,246	)
Net change in cash during the period, before effects of foreign currency		$	(213,175	)		$	95,357

Cash flow from Operating Activities

During the year ended December 31, 2025, the Company incurred a loss of $3,865,621. This negative impact to cash was offset by an $2,738,371 increase in accounts receivable, and a $1,586,559 increase in accounts payable, providing a net positive cash flow from operations of $1,152,792.

Cash flow from Investing Activities

During the year ended December 31, 2025, the Company used $2,815,068 of cash primarily investing in $2,551,611 in aircraft assets and $263,457 in engine reserves.

Cash flow from Financing Activities

During the year ended December 31, 2025, the Company received $1,650,223 in cash of financing activity primarily from related party long term debt.

Off-Balance Sheet Arrangements

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.

Liquidity and Capital Resources

At December 31, 2025, the Company had current assets of $3,727,772 and current liabilities of $16,333,220 compared with current assets of $997,117 and current liabilities of $5,358,619 at December 31, 2024. The continuation of the Company as a going concern is dependent upon generating additional charter revenue growth by improving current aircraft fleet charter operations, and obtaining cost effective financing to invest in additional charter aircraft.

Future Financings

We will continue to rely on related parties, equity sales of our common shares or debt financing arrangements in order to continue to fund our business operations. Issuance of additional shares will result in dilution to existing stockholders. There is no assurance that we will achieve any additional sales of the equity securities or arrange for debt or other financing to fund our operations and other activities.

Critical Accounting Policies

Refer to our Premier Holdings audited financial statements for the years ended December 31, 2025, and 2024 financial statements for a full discussion of our critical accounting policies.

Revenue Recognition

The Company generates revenue primarily from charter services, aircraft management fees, and maintenance services. Revenue is recognized when control of the promised services is transferred to the customer, which generally occurs at a point in time as charter services are completed. The application of revenue recognition guidance requires significant judgment, particularly in determining the appropriate timing of revenue recognition for charter flights that may span reporting periods, identifying performance obligations in arrangements that include multiple services, and assessing whether the Company is acting as a principal or an agent in certain transactions. Changes in these judgments could materially impact the timing and amount of revenue recognized. For example, changes in the assessment of performance obligations or the timing of service delivery could result in revenue being recognized in different reporting periods. Refer to Note 2 - Summary of Significant Accounting Policies in the consolidated financial statements for additional information.

Accounts Receivable and Allowance for Credit Losses

Accounts receivable represent amounts due from customers for services provided and are recorded net of an allowance for expected credit losses. As of December 31, 2025, the Company had accounts receivable of approximately $2,902,173 million, net of an allowance of approximately $1,568,030 million. The allowance for credit losses is based on management's estimate of expected losses over the life of the receivables and requires significant judgment. In developing this estimate, management considers historical collection experience, the creditworthiness of customers, the aging of receivables, current and forward-looking economic conditions, and the concentration of credit risk among key customers. Given the significant increase in accounts receivable and the related allowance during 2025, this estimate is particularly sensitive to changes in assumptions regarding customer collectability. A deterioration in customer financial condition or changes in economic conditions could result in higher expected credit losses and increased expense in future periods. Refer to Note 2 - Summary of Significant Accounting Policies for additional details.

Maintenance Reserves

Maintenance reserves represent payments made in connection with aircraft engine and airframe maintenance programs and are recorded as assets when such amounts are considered recoverable under the terms of the related agreements. As of December 31, 2025, maintenance reserves totaled approximately $3,058,945. The accounting for maintenance reserves requires significant judgment, particularly in determining whether amounts paid are recoverable, estimating the timing and extent of future maintenance events, assessing compliance with lease return conditions, and evaluating the likelihood of reimbursement from lessors or program providers. These estimates are inherently uncertain and depend on factors such as aircraft utilization, maintenance schedules, and contractual terms. Changes in expected aircraft usage, maintenance cost estimates, or assumptions regarding recoverability could result in material adjustments to the carrying value of maintenance reserves and related expenses in future periods. Refer to Note 3 - Financial Statement Elements for additional details.