20-F: Vision Marine Reports $21.6M Loss, Integrates Nautical Ventures

Vision Marine Technologies Inc. reported a significant net loss of $21.6 million for fiscal year 2025, alongside strategic expansion through the acquisition of Nautical Ventures Group Inc.

Summary

• Vision Marine Technologies Inc. (VMAR) reported a net loss of $21,651,993 for the fiscal year ended August 31, 2025, a substantial increase from $10,383,171 in the prior fiscal year.
• Total revenue for fiscal year 2025 was $13.8 million, with approximately 92.8% ($12.8 million) generated by Nautical Ventures Group Inc. (Nautical Ventures) since its acquisition in June 2025.
• The company completed the acquisition of Nautical Ventures, a Florida-based recreational boat dealership, marina, and service provider, on June 23, 2025.
• Nautical Ventures' operations, primarily boat sales from third-party manufacturers (51% from Axopar in calendar 2024), accounted for approximately 65.2% of total assets as of August 31, 2025.
• The company's legacy electric-focused operations, including the e-Motion Powertrain development and electric boat manufacturing, generated approximately 7.2% of total revenue in fiscal 2025.
• Vision Marine's e-Motion electric powertrain system achieved a world record speed of 116 mph in August 2023 and has been approved for California's Clean Off-Road Equipment (CORE) Voucher Incentive Project, offering up to $170,000 per unit.
• The company launched the E-Motion 180e inboard electric motor system in September 2024, expanding its offerings to a new market segment.
• Vision Marine faces a material weakness in internal controls over financial reporting due to a lack of sufficient accounting and finance personnel for complex and non-routine transactions.
• The financial statements are prepared on a going concern basis, with future operations dependent on successful equity or debt financing and achieving profitable operations.
• The company's common shares are listed on Nasdaq Capital Market, and it has previously faced non-compliance with the minimum bid price requirement, leading to multiple reverse stock splits (cumulative 1-for-1,350).
• Total liabilities as of August 31, 2025, were $61,462,255, with $32,511,664 related to floor plan financing for inventory.
• Research and development costs decreased to $1,183,963 in fiscal 2025 from $2,013,775 in fiscal 2024, as the company moved towards production.
• The company anticipates ceasing to be a foreign private issuer as of September 1, 2026, which will increase regulatory and compliance costs and require financial statements to be prepared in U.S. GAAP.

Sentiment

Score: 3

Explanation: The company reported a significantly increased net loss and has a going concern doubt, indicating severe financial challenges. While the acquisition of Nautical Ventures and technological advancements in electric powertrains are positive strategic moves, the immediate financial performance, high leverage, and internal control weaknesses present substantial concerns. The repeated reverse stock splits and Nasdaq compliance issues also reflect underlying instability.

Positives

• Strategic acquisition of Nautical Ventures Group Inc. significantly expanded retail access and revenue streams, contributing 92.8% of total revenue in fiscal 2025.
• Nautical Ventures was ranked number one in Boating Industry magazine's top 100 U.S. dealerships in February 2025, demonstrating strong market presence and sales capabilities.
• The e-Motion electric powertrain system achieved a new world record speed of 116 mph for an all-electric boat in August 2023, showcasing technological innovation.
• The e-Motion system is approved for California's Clean Off-Road Equipment (CORE) Voucher Incentive Project, offering significant point-of-sale vouchers up to $170,000 per unit, which can accelerate adoption.
• Expansion of the e-Motion product line with the launch of the 180e inboard electric motor system in September 2024 opens new market segments.
• Partnerships with industry players like Groupe Beneteau (Four Winns), Armada Pontoons, Calip Group, STERK, Octillion Power Systems, Hydrofin, Taiga Motors Inc., and BRP Electrification Engineering Services enhance product development, manufacturing, and distribution capabilities.
• The company has filed thirteen patent applications for its e-Motion powertrain system, with plans for eleven more, strengthening intellectual property protection.
• The establishment of a dedicated electric boating division within Nautical Ventures provides a complete EV-focused experience, encompassing sales, service, and support.
• Net finance income increased to $5,498,656 in fiscal 2024 from a net finance expense of $766,477 in fiscal 2023, primarily due to gains on derivative liabilities.

Negatives

• Reported a substantial net loss of $21,651,993 for the fiscal year ended August 31, 2025, more than double the $10,383,171 loss in the prior fiscal year.
• The company's financial statements are prepared on a going concern basis, indicating substantial doubt about its ability to continue operations without additional financing.
• Identified a material weakness in internal controls over financial reporting due to a lack of sufficient accounting and finance personnel for complex and non-routine transactions.
• The company is highly leveraged, with $32.5 million of its $61.5 million total liabilities as of August 31, 2025, consisting of floor plan financing notes payable.
• Nautical Ventures experienced technical defaults with five lenders in 2024 due to reduced margins, excessive dealer inventory, fierce competition, and high floor plan interest rates, requiring forbearance agreements.
• The company's common shares have experienced significant price volatility, with a high of $21,114.00 and a low of $1.10 during the fiscal year, and are currently near the Nasdaq $1.00 minimum bid price requirement.
• Multiple reverse stock splits (cumulative 1-for-1,350) have been enacted to maintain Nasdaq listing compliance, which can be viewed negatively by public markets.
• Dependence on a single manufacturer, Axopar, for approximately 38% of net revenues in fiscal 2025, poses a significant concentration risk.
• The company's ability to acquire additional properties from Nautical Ventures is contingent on obtaining alternative financing, otherwise it will be subject to leasing risks.
• The company sold its electric boat rental operations in Newport Beach, California, in April 2024, significantly decreasing the size of its rental business.
• The company has not yet made significant sales of its e-Motion electric powertrains to OEMs, despite partnerships and deliveries for integration.
• The company does not intend to pay dividends, limiting ways for investors to gain from their investment to share price appreciation.

Risks

• Limited public operating history makes evaluating the business and prospects difficult, especially with the recent acquisition of Nautical Ventures.
• Inability to achieve and grow net income in the future could adversely affect business growth, requiring curtailment of operations or additional financings.
• Significant capital is required to carry out the business plan, and financing might not be available on favorable terms, potentially forcing a reduction or discontinuation of operations.
• Terms of subsequent financings (equity, debt, or preferred shares) may adversely impact existing investments through dilution or increased costs.
• Expected benefits from business acquisitions, particularly Nautical Ventures, may not materialize due to integration challenges, resulting in lost opportunities, higher costs, or key personnel departures.
• Demand in the boat industry is highly volatile, being a non-essential item, and historically decreases during economic downturns, which could disproportionately affect the company due to fewer financial resources.
• Unfavorable weather conditions, especially during peak boating season, may materially and adversely affect sales and rentals.
• Interest rate increases could adversely affect boat sales by increasing financing costs for consumers.
• Inflation, particularly related to wages and raw material costs, could adversely affect financial results and increase boat ownership costs, deterring purchases.
• Dependence on certain key personnel, and the inability to retain and attract qualified personnel, could adversely affect operations.
• Subject to numerous regulations, including environmental, health, and safety laws, with any breach potentially having a material adverse effect.
• Product liability, warranty, personal injury, property damage, and recall claims, especially given the use of Lithium-ion batteries and highly flammable fuels, may materially affect financial condition and damage reputation.
• Potential liability from workplace accidents, including ongoing legal proceedings related to an October 2024 marina fire that injured five employees, one fatally.
• Global economic conditions, including geopolitical developments, inflation, and market turbulence, could materially adversely impact demand and supply chains.
• Future pandemics may disrupt business and operational plans due to employee shortages, supply chain interruptions, or government restrictions.
• Vulnerability to supply chain risks, including delays or price fluctuations from third-party manufacturers due to geopolitical conflicts, tariffs, pandemics, or natural disasters.
• Fluctuations in currency exchange rates (CAD/USD) may significantly impact reported results of operations, as the company does not hedge its currency exposure.
• Material weaknesses or failure to maintain an effective system of internal controls over financial reporting may adversely affect investor confidence and share value.
• Inability to maintain compliance with Nasdaq's continued listing requirements could lead to delisting, negatively affecting liquidity and trading price.
• Difficulties in protecting shareholder interests due to incorporation under Quebec law and the majority of directors/officers residing outside the U.S.
• Potential loss of foreign private issuer status in the future (anticipated by September 1, 2026) could result in significant additional regulatory and compliance costs.
• Continued access to floor plan financing for inventory is crucial for the dealership business, and its availability and terms depend on various factors including creditworthiness.
• The business model entails carrying substantial amounts of debt, and failure to properly service this debt could lead to severe penalties, asset sales, or unfavorable refinancing.
• Success depends on the well-being, popularity, and reputation for quality of boating products from manufacturers, with any difficulties affecting supply and support.
• Reliance on one manufacturer (Axopar) for a substantial portion of sales (38% of net revenues in fiscal 2025) creates concentration risk, exacerbated by potential tariffs on Polish-manufactured goods.
• Intense competition in the highly fragmented recreational boat industry, including from larger national/regional chains and private used boat sales.
• Difficulty in forecasting optimal inventory levels and anticipating consumer preferences may negatively impact inventory management and operating margins.
• Sales volume and profit margins may be adversely affected if manufacturers discontinue or change incentive programs.
• Dependence on manufacturers to supply sufficient numbers of popular and profitable new models, which are often in limited supply.
• Decreased boat sales could lead to a decrease in revenue from related parts, accessories, and services.
• The plan of operations entails promoting an electric powertrain product that may never launch or may not be commercially accepted by OEMs.
• Future growth depends upon consumers' willingness to purchase electric powerboats, and a slower-than-expected market development would negatively impact the business.
• Future growth depends upon consumers' preference for outboard motors; a decline in this preference could reduce sales of electric powertrains.
• Reliance on a limited number of suppliers for key components of finished products (e.g., batteries, inverters, motors) without long-term purchase agreements, creating supply chain vulnerability.
• The range of electric powerboats on a single charge declines over time, which may negatively influence potential customers' purchasing decisions.
• Developments in alternative technologies (e.g., advanced diesel, fuel cells) or improvements in internal combustion engines may materially adversely affect demand for electric powerboats.
• Inability to keep up with advances in electric powerboat technology, particularly powertrains, could lead to a loss of competitive position.
• Reliance on a third-party (Linamar Corporation) for mass production of the e-Motion electric powertrain system, with potential delays or cost increases if they are unable to satisfactorily manufacture.
• Potential need to find alternative suppliers at significant expense or with material production delays if current suppliers use conflict minerals.
• Failure to comply with terms of open-source software licenses used in electric powertrain control systems could negatively affect the business.
• Reliance on network and information systems, with events like computer hackings or viruses potentially disrupting operations and causing financial loss.
• The unavailability, reduction, or elimination of government economic incentives (e.g., local restrictions on ICEs) could adversely affect the desirability of electric powerboats.
• Business may be adversely affected by labor and union activities, including potential higher employee costs or work stoppages.
• Inability to attract and retain qualified manufacturing workforce at a reasonable cost could materially adversely affect results.
• Intellectual property is not fully protected through patents or formal copyright registration, making it difficult to prevent others from replicating products.
• Confidentiality agreements with employees and others may not adequately prevent disclosure of trade secrets and other proprietary information.
• Patent applications may not result in issued patents or afford sufficient protection against competitors.
• Limited registered trademarks for products and trade names, potentially leading to confusion or tarnishing by competing products.
• Potential need to defend against patent or trademark infringement claims, resulting in substantial costs, negative publicity, and diversion of resources.
• Volatility in common shares price may subject the company to securities litigation.
• Shareholders may experience immediate and substantial dilution as a result of future equity offerings.
• As an emerging growth company, the company is subject to lessened disclosure requirements, which may make common shares less attractive to investors.
• Incurring significant costs as a public company, which will grow after ceasing to qualify as an emerging growth company (anticipated September 1, 2026).
• If characterized as a passive foreign investment company (PFIC) for U.S. federal income tax purposes, U.S. investors would be subject to certain adverse tax consequences.

Future Outlook

The company aims to accelerate electric propulsion adoption by expanding OEM integration, enhancing consumer education, driving revenue through dedicated electric propulsion installation services, and becoming a reference in electric marine servicing. It plans to invest in research and development, operational efficiency, and service infrastructure to meet growing demand. The company anticipates ceasing to be a foreign private issuer by September 1, 2026, which will necessitate a conversion of financial statements to U.S. GAAP and increased compliance costs. Future operations depend on successful equity or debt financing and achieving profitability at an indeterminate time.

Management Comments

• "We believe that we have based our forward-looking statements on reasonable assumptions, estimates, analysis and opinions made in light of our experience and our perception of trends, current conditions and expected developments, as well as other factors that we believe to be relevant and reasonable in the circumstances at the date that such statements are made, but which may prove to be incorrect."
• "Although management believes that the assumption and expectations reflected in such forward-looking statements are reasonable, we may have made misjudgments in preparing such forward-looking statements."
• "We are working on remediating the identified material weakness [in internal controls]."
• "We believe that Vision Marine’s experience with electric boats enhances the ability of the network of dealerships provided by Nautical Ventures to sell electric boats."
• "We envision the increased sale of electric boats by Nautical ventures to include both boats manufactured by us as well as those manufactured by third parties."
• "We believe that we can expand revenue from products and services related to boats through the Nautical Ventures network."
• "We envision that if we are able to mass produce our electric powertrains, a significant of our revenue will be generated from the sale of our electric powertrains."
• "We believe that our electric outboard powertrain systems are significantly more efficient and powerful than those currently being offered in the market today."
• "We believe our approach in marketing and selling our powertrain technology to boat designers and manufacturers will enable us to leverage their distribution and servicing systems with minimal capital outlay."
• "We expect our core intellectual property contained within our outboard electric powertrain systems to form the foundation for our future growth and for such systems to represent the majority of our revenue."
• "We believe that combining a controlled retail network with a technology integration strategy positions us to scale efficiently, maintain visibility over the customer journey, and foster broader market adoption of electric propulsion."
• "We will continue to invest in research and development, operational efficiency, and our service infrastructure to meet the growing demand across both recreational and commercial marine segments."
• "We believe that the technological design of our electric powertrain will provide efficiency at a price that our competitors will not be able to match."
• "We believe that our facilities comply in all material aspects with these regulations [labor regulations]."

Industry Context

The recreational boating market in North America is substantial, with 75 million participants and $57.7 billion in retail sales in 2023. The outboard motor market is also growing, with sales surpassing $10.5 billion and a projected 5% CAGR by 2032. While traditional fossil fuel engines dominate, the electric outboard motor market is a relatively new but growing phenomenon. The global electric boat market is projected to reach $16.6 billion by 2031, growing at a 12.9% CAGR. The industry is highly competitive and fragmented, with many small retailers. Vision Marine's acquisition of Nautical Ventures, a top U.S. dealership, positions it to capitalize on this market, especially by integrating its electric propulsion technology into an established sales network. The company faces competition from large conglomerates (Yamaha, Bombardier, Suzuki) and nimble startups in the electric segment (Torqeedo).

Comparison to Industry Standards

• Vision Marine's e-Motion electric powertrain system boasts an efficiency of more than 96%, significantly higher than the 54% recorded for its principal competitor's product (Torqeedo), indicating a strong technological advantage in power and range.
• Nautical Ventures, acquired by Vision Marine, was ranked number one in Boating Industry magazine's top 100 U.S. dealerships in February 2025, suggesting strong retail performance and customer service compared to industry peers.
• The company's electric boats have achieved world record speeds (116 mph), demonstrating superior performance in the niche of high-performance electric boating compared to general electric boat offerings.
• The company's reliance on floor plan financing with a weighted average interest rate of 9.7% as of August 31, 2025, is a common practice in the dealership industry but highlights sensitivity to interest rate fluctuations.
• The company's net loss of $21.6 million in fiscal 2025, compared to $10.3 million in 2024, indicates a significant increase in losses, which is worse than typical industry profitability trends, especially for a company undergoing strategic expansion.
• The material weakness in internal controls over financial reporting is a significant deficiency compared to best practices for publicly traded companies, potentially impacting investor confidence.
• The company's repeated reverse stock splits (cumulative 1-for-1,350) to maintain Nasdaq listing compliance is an unusual and generally negative indicator compared to stable, well-performing public companies.

Management Changes

Corporate Governance

Legal Proceedings

• A lawsuit was filed by the estate of a deceased employee following an October 2024 marina fire that injured five employees, one fatally. The initial claim was dismissed, but the company is named as a defendant in a suit seeking recovery for damages and lost income from a trailer owner.
• The company is negotiating with the Occupational Safety and Health Administration for the settlement of claims concerning alleged workplace safety violations related to the October 2024 marina fire.
• On November 4, 2025, Clairitec S.A.S., a French supplier, filed a Notice of Civil Claim with the Commercial Tribunal of Bordeaux, France, alleging breach of a supply contract for battery chargers, seeking 398,050.

Related Party Transactions

• The company leases its Boisbriand, Quebec headquarters and manufacturing space from California Electric Boat Company Inc., an entity controlled by CEO Alexandre Mongeon. Monthly rent for four adjacent units totals approximately C$17,890, with leases expiring July 31, 2026.
• Nautical Ventures entered into lease agreements on June 10, 2025, with Marine Ventures LLC, an entity controlled by Chief Revenue Officer Roger Moore, for commercial properties. Total monthly lease payments range from $71,860 to $133,775, with options to purchase the properties.
• The company sold 100% of the shares of EB Rental, Ltd. to EB Strategies Inc. for $794,616 on April 25, 2024. EB Strategies Inc. was a related party whose controlling shareholder was a member of management of EB Rental, Ltd. prior to the sale.
• Research and Development expenses of $997,479 in fiscal 2025 and $2,028,793 in fiscal 2024 were paid to Mac Engineering, SASU, an entity controlled by Xavier Montagne, a former officer.
• Rent expense of $148,032 in fiscal 2025 was paid to Marine Ventures LLC, controlled by Roger Moore.
• Management fees of $254,084 were booked through Contributed Surplus from Marine Ventures LLC in fiscal 2025.
• The company has a non-interest bearing demand note receivable of $3,422,154 and a contingent receivable of $6,967,763 from Marine Ventures LLC.
• Purchase consideration payable to related party Roger Moore includes an Initial Convertible Note of $3,111,810, a Subsequent Convertible Note of $653,262, and a Real Estate Note of $1,283,484.

Stakeholder Impact

• **Shareholders:** Face significant dilution risk from past and future equity offerings, volatility in share price, and a substantial net loss. The going concern doubt and material weakness in internal controls could further erode confidence and share value. The lack of dividends means returns depend solely on capital appreciation. Nasdaq listing compliance issues pose a delisting risk, impacting liquidity.
• **Employees:** The company's success depends on key personnel, and the acquisition of Nautical Ventures has led to new executive appointments. Workplace safety concerns from the marina fire and ongoing legal proceedings could impact employee morale and safety perceptions. The company's ability to attract and retain qualified manufacturing employees is crucial.
• **Customers:** The acquisition of Nautical Ventures expands the product portfolio and service network, potentially offering a more comprehensive experience. The focus on electric propulsion and partnerships aims to provide innovative, eco-friendly options. However, supply chain risks and potential product liability claims could affect product availability and trust.
• **Suppliers:** The company relies on a limited number of suppliers for key components, creating dependency. Changes in trade policies or tariffs could increase costs for suppliers, which may be passed on to the company. Forbearance agreements with floor plan lenders indicate financial stress that could impact supplier relationships.
• **Creditors:** The company carries substantial debt, particularly floor plan financing. Technical defaults with lenders and the going concern doubt increase credit risk. The ability to service debt and obtain future financing is critical for continued operations.

Next Steps

• Remediate the identified material weakness in internal controls by hiring additional personnel and implementing revised controls and procedures.
• Seek shareholder approval for the Restricted Share Unit Plan and related equity awards at the next annual general meeting, to be held by February 28, 2026.
• Continue efforts to commercialize the e-Motion electric powertrain system and secure OEM sales.
• Expand electric integration services in Florida through the Nautical Ventures network.
• Pursue efforts to expand revenue from products and services related to boats through the Nautical Ventures network, including financing and warranty opportunities.
• Obtain alternative financing to exercise options to purchase the remaining four properties from Marine Ventures LLC.
• Monitor and maintain compliance with Nasdaq's continued listing requirements, particularly the minimum bid price.
• Continue investing in research and development, operational efficiency, and service infrastructure.
• Prepare for the anticipated loss of foreign private issuer status by September 1, 2026, including conversion of financial statements to U.S. GAAP.
• Negotiate with the Occupational Safety and Health Administration for the settlement of claims concerning alleged workplace safety violations related to the October 2024 marina fire.

Key Dates

Recommendation

Vision Marine Technologies Inc. presents a complex investment profile. The significant increase in net loss and the 'going concern' qualification are major red flags, indicating severe financial distress and operational challenges. The material weakness in internal controls further undermines confidence. However, the strategic acquisition of Nautical Ventures, a top-ranked dealership, provides a substantial revenue base and a critical distribution channel, especially for the company's innovative e-Motion electric powertrains. The technological leadership in electric propulsion, evidenced by world records and key partnerships, offers long-term growth potential in a rapidly expanding market. The stock has experienced extreme volatility and multiple reverse splits, suggesting high risk. A 'hold' recommendation is appropriate for existing investors who believe in the long-term vision of electric marine technology and the potential synergies with Nautical Ventures, but acknowledge the substantial financial and operational risks. New investors should exercise extreme caution due to the high risk profile and consider waiting for clearer signs of financial stability and successful integration before investing.

Keywords

Electric Boats, Electric Powertrain, Marine Technology, Boat Dealership, Nautical Ventures, SEC Filing, 20-F, Financial Results, Net Loss, Acquisition, Risk Factors, Nasdaq Listing, Corporate Governance, Supply Chain, Intellectual Property, Boating Industry, EV Marine, Floor Plan Financing, Share Dilution, Internal Controls