ST. JOHN’S, Newfoundland, May 31, 2018 (GLOBE NEWSWIRE) -- Kraken Robotics Inc. (TSX-V:PNG) (OTCQB:KRKNF) announced it has filed its financial results for the first quarter ended March 31, 2018. Additional information concerning the Company, including its unaudited condensed consolidated interim financial statements and related management’s discussion and analysis (“MD&A”) for the quarter ended March 31, 2018, can be found at www.sedar.com. Unless otherwise stated, all dollar amounts are Canadian dollar denominated.
CEO Comments
“While Q1 revenue was impacted by the transition to the new IFRS 15 revenue rules, for 2018, we continue to target revenue of more than $7 million,” said Karl Kenny, Kraken’s President and CEO. “This growth target excludes upside from several, large, multi-unit defense industry bids that we have submitted and are currently being reviewed. Our new KATFISH™ and SeaVision® products have received significant inbound interest, and we anticipate they will gain penetration across both military and commercial markets through the balance of 2018. Adoption of our AquaPix® sensor products is growing with broadening customer orders, and we expect to have a new next generation SAS available in 2019, called the Multispectral SAS. With the nearing launch of our Tentacle™ Intelligent Winch products and continued development of the ThunderFish® Autonomous Underwater Vehicles (AUV), we are rounding out our sensor and robotics technology portfolio. We believe we are nicely positioned as the defense market undergoes an upgrade cycle and commercial markets increasingly adopt underwater robotic technology.”
Q1 2018 Highlights
- Revenue was $0.1 million for the quarter as compared to $0.3 million in the year ago quarter. The implementation of the new IFRS 15 accounting rules regarding revenue recognition, while not affecting cash flows, negatively affected the timing of reported revenue as we did not use “percentage of completion” accounting on orders being built and projects in progress. Our typical product lead times often span from one to three quarters and vary depending on our inventory levels and whether the customer order is for a new or custom product versus a standard product. As a result, our revenue can be lumpy on a quarterly basis. That being said, the Company is still targeting annual revenue of more than $7 million in 2018;
- Net loss was $1.5 million as compared to $0.7 million in the year ago quarter. The increase was due to the lower revenues, year over year, as well as increased costs to support multiple R&D projects and increased headcount in all areas of the business to support current and anticipated customer orders;
- We completed a non-brokered private placement of common shares, which when combined with the exercise of outstanding warrants resulted in gross proceeds of $1.9 million;
- At quarter-end, Kraken had $1.5 million of funding awards (i.e. grants) to draw upon from the National Research Council of Canada Industrial Research Assistance Program (NRC-IRAP) and Innovate Newfoundland. These grants will be drawn down over the next four quarters. The Company exited the quarter with a cash balance of nil, flat from that reported at December 31, 2017. Excluding deferred revenue working capital for the quarter was $0.1 million, compared to a ($0.8) million working capital deficit at December 31, 2017. A $750,000 short-term loan established in the quarter will be repaid at the end of Q2 from more than $2 million of customer milestone payments expected to be received in Q2.
- We formed a strategic partnership with US-based defense integrator Thayer Mahan;
- Notable Work in Process during the Quarter included:
- Sonar sensors – Engineering and production work on first purchase order of a multi-unit AquaPix® contract announced in Q3 2017;
- KATFISH™ – Build and testing of military version of KATFISH™ towed underwater vehicle for European customer;
- Laser sensors - Sea trials of our new SeaVision® laser imaging system;
- Sensors and software – Continued work on a contract for sensors and robotics for ship hull inspections that was announced in Q4 2017;
Subsequent Highlights after March 31
- Pre-qualified for a Build in Canada Innovation Program (BCIP) contract for our ThunderFish® AUV platform;
- Announced development of next generation of sonar sensor. The AquaPix® Multispectral Synthetic Aperture Sonar (SAS) will be the world’s first commercial SAS to operate over such a wide spectrum, ranging from low audible frequencies to high ultrasonic frequencies. This new technology will significantly extended search range at constant high-resolution seabed pixels; will allow for sub-bottom 3D volumetric imaging (i.e. finding objects buried beneath the seafloor); and will increased the speed and accuracy for seabed classification and characterization.
- Successfully completed military standard certification testing of the KATFISH-M, a ruggedized version of Kraken’s KATFISH™ Towed Synthetic Aperture Sonar Platform. While the commercial version of KATFISH™ is priced at US$1.5 million, the military certified version, KATFISH-M, is priced at US$2.5 million.
ABOUT KRAKEN ROBOTICS INC.
Kraken Robotics Inc. (TSX.V:PNG) (OTCQB:KRKNF) is a marine technology company that is dedicated to the production and sale of software-centric sensors and underwater robotic systems. The company is headquartered in St. John’s, Newfoundland with offices in Dartmouth, Nova Scotia; Bremen, Germany; and Fairfax, Virginia. Kraken is ranked as a Top 100 marine technology company by Marine Technology Reporter. For more information, please visit www.krakenrobotics.com, www.krakenrobotik.de, www.krakenpower.de. Find us on social media on Twitter (@krakenrobotics), Facebook (@krakenroboticsinc) and LinkedIn.
Certain information in this news release constitutes forward-looking statements. When used in this news release, the words "may", "would", "could", "will", "intend", "plan", "anticipate", "believe", "seek", "propose", "estimate", "expect", and similar expressions, as they relate to the Company, are intended to identify forward-looking statements. In particular, this news release contains forward-looking statements with respect to, among other things, business objectives, expected growth, results of operations, performance, business projects and opportunities and financial results. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. Such statements reflect the Company's current views with respect to future events based on certain material factors and assumptions and are subject to certain risks and uncertainties, including without limitation, changes in market, competition, governmental or regulatory developments, general economic conditions and other factors set out in the Company's public disclosure documents. Many factors could cause the Company's actual results, performance or achievements to vary from those described in this news release, including without limitation those listed above. These factors should not be construed as exhaustive. Should one or more of these risks or uncertainties materialize, or should assumptions underlying forward-looking statements prove incorrect, actual results may vary materially from those described in this news release and such forward-looking statements included in, or incorporated by reference in this news release, should not be unduly relied upon. Such statements speak only as of the date of this news release. The Company does not intend, and does not assume any obligation, to update these forward-looking statements. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement.
Neither the TSX Venture Exchange Inc. nor its Regulation Services Provide (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release, and the OTCQB has neither approved nor disapproved the contents of this press release.
For further information, please contact:
Greg Reid, Chief Financial Officer
(416) 818-9822
greid@krakenrobotics.com
Sean Peasgood, Investor Relations
(647) 955-1274
sean@sophiccapital.com
Glenda Leyte, Marketing Manager
(709) 757-5757 extension 288
gleyte@krakenrobotics.com