Ms. Erika Racicot reports

CANADA'S $80 BILLION DEFENCE MODERNIZATION PACKAGE SIGNALS STRATEGIC SHIFT-DRAGANFLY POSITIONED FOR RAPID GROWTH WITH INTEGRATION OF DND-SPECIFIED RADIO SYSTEMS

Draganfly Inc. is a drone solution and system developer, and has noted Prime Minister Mark Carney has released plans for an $80-billion long-term defence investment package focused on technological modernization, domestic industrial capacity and unmanned aerial systems in a decisive move to fortify Canada's national security capabilities. This landmark announcement, inclusive of robust support for drone development and Canadian manufacturing, marks a generational shift in federal defence procurement strategy.

Draganfly is positioned to contribute to objectives within the "Our North Strong and Free" defence policy expansion. Draganfly's interoperable and multimission family of unmanned aircraft system platforms is strategically aligned with stated Department of National Defence priorities such as expanding and enhancing existing and emerging military capabilities related to border security and Arctic sovereignty. Demonstrating this adaptability, Draganfly confirms the successful integration and demonstration of a Department of National Defence-specified radio communications system into its flagship drone platforms, in addition to several other communication system integrations, to support interoperability with existing assets. These integrations help prime the company for eligibility in coming federal UAS procurements that emphasize secure, interoperable and sovereign systems.

Draganfly, with multiple research and development and manufacturing sites in Canada, is one of the world's longest-standing commercial UAS manufacturers. The capacity for expansion of domestic production, in combination with long-standing strategic relationships that Draganfly holds with various related technologies providers across various Five Eyes regions, uniquely positions Draganfly as a technology integrator and solution provider.

This week's developments signal a major policy realignment by Ottawa, anchoring defence spending to strategic domestic priorities such as resilient supply chains, sovereign manufacturing, and interoperability with NATO and Five Eyes partners. The emphasis on drone capabilities and homeland industrial content is particularly relevant in an era marked by asymmetric threats and hybrid warfare.

Prime Minister Carney's announcement effectively maps a multiyear demand curve for Canadian aerospace, cybersecure communications and autonomous system providers. Analysts anticipate that a minimum of 20 per cent of the $80-billion envelope will be earmarked for next-generation battlefield technologies, with drones expected to account for a significant share of this investment.

Draganfly's ability to support existing architecture and protocols while providing the ability to rapidly test and adopt emerging technologies with domestic manufacturing and engineering expertise is poised to support these pillars of the defence modernization package. Adoption of Draganfly product for testing and use by Canadian and U.S. military customers and prime contractors through 2024 and 2025 validates its platforms for critical applications such as reconnaissance, force protection and logistics resupply. This positions Draganfly as one of the few Canadian original equipment manufacturers and supply chain managers capable of delivering mission-ready systems that meet both tactical requirements and industrial policy criteria.

Strategic implications for capital markets and domestic industry:

• Domestic preference: The federal focus on Canadian manufacturing aligns with the industrial and technological benefits policy, making domestically integrated platforms poised to win procurement bids.
• Supply chain security: In an age of escalating global tensions, Canada is reducing reliance on foreign critical components. Draganfly's control over its own airframe and avionics intellectual property gives it a defensible advantage.
• Dual-use upside: Beyond military contracts, the integrated communication system enhances the company's value proposition in emergency response, disaster relief and public safety markets.
• Revenue catalysts: Analysts expect RFIs and RFPs for defence-grade drones to accelerate in the second half of 2025, with contract awards potentially materializing as early as first quarter 2026. Draganfly's early compliance could provide a first-mover advantage.

About Draganfly Inc.

Draganfly is the creator of quality, cutting-edge drone solutions, software and artificial intelligence systems that revolutionize how organizations can do business and serve their stakeholders. Recognized as being at the forefront of technology for over 25 years, Draganfly is an award-winning industry leader serving the public safety, agriculture, industrial inspections, security, mapping and surveying markets. Draganfly is a company driven by passion, ingenuity and the need to provide efficient solutions and first-class services to its customers around the world with the goal of saving time, money and lives.

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