Draganfly Inc. (NASDAQ: DPRO) (CSE: DPRO) (FSE: 3U8) (“Draganfly”
or the “Company”), an award-winning, industry-leading drone
solutions and systems developer, is pleased to announce its fourth
quarter and fiscal 2023 financial results. Revenue for the fourth
quarter and the year was dictated by the shift to larger in-house
capacity and drone production capabilities.
The financial year 2023 was a transition year
for Draganfly as 2023 marked new production capacity coming online
along with the commercialization of its flagship Commander 3XL and
Heavy Lift Drone platforms.
Key Financial Highlights for
2023:
- Total revenue for
the year ended December 31, 2023, was $6,554,842. Product sales
decreased $263,339 in 2023 as compared to 2022, while services
revenue decreased $786,878. This is largely due to product line
transition and a focus on building new and increased production
capabilities
- Gross Profit was
$2,064,114, an increase of $1,273,439 or up 161.1% from the prior
year. As a percentage of sales, gross margin increased from 10.4%
in 2022 to 31.5% in 2023. This year’s gross profit included a
one-time non-cash write-down of inventory of $331,671 while last
year’s gross profit included a non-cash downward adjustment of
$1,976,514. Excluding these adjustments, gross profit decreased by
$371,404 year over year. As a percentage of sales, adjusted gross
margin increased from 36.4% in 2022 to 36.5% in 2023.
- The Company
recorded a comprehensive loss including all non-cash items of
$23,709,851 compared to a comprehensive loss of $27,305,305 in
2022. The comprehensive loss for the year ended December 31, 2023,
includes non-cash changes comprised of a gain in fair value of
derivative liability from warrants of $211,110, an expense for
impairment of notes receivable of $101,351, a write-down of
inventory of $331,671, and an expense for goodwill and intangibles
impairment of $87,415 and would otherwise have been a comprehensive
loss of $23,400,524 compared to a comprehensive loss of $24,067,180
excluding non-cash items in the same period last year. Cash used in
operating activities decreased by $1,304,184 year over year.
- The Company’s cash
balance on December 31, 2023, was $3,093,612.
Key Financial and Operational Highlights for Q4 2023 and
Early 2024:
- Revenue for Q4
2023 was $916,299 compared to $1,314,162 for Q4 2022 largely due to
a decrease in Q4 product sales relating to product line transition
and new customer category integration requirements along with
slightly lower services sales.
- Gross Profit was
$258,879 for Q4 2023 compared to -$1,665,971 in Q4 2022
representing an increase of $1,924,850 year over year. Gross profit
for Q4 2023 would have been $382,303 if it wasn’t for a one time
non-cash write down of inventory of $123,424 while Q4 2022 would
have been $310,543 not including a one-time non-cash write down of
inventory for $1,976,514. Hence, gross profit on an adjusted basis
was up 23.1% year over year. Gross profit as a percentage of sales
for Q4 2023 was 28.3% but on an adjusted basis was 41.7%.
- The Company
recorded a comprehensive loss including non-cash items for Q4 2023
of $4,191,796 compared to a comprehensive loss of $16,660,602 for
the same period in 2022. A 69.3% improvement over 2022. The
comprehensive loss for the fourth quarter of 2023 includes non-cash
changes comprised of a gain in fair value derivative liability of
$153,798 as well as a one time write down of inventory of $123,424,
and would otherwise be a comprehensive loss of $4,222,170 compared
to a comprehensive loss of $7,482,545 excluding non-cash items in
the same period last year. The decrease in loss was primarily due
to lower professional fees, wages, and share based compensation
charges.
- The Company received a Transport
Canada Special Flight Operations Certificate (SFOC) for its Heavy
Lift Drone to support advanced flight testing above 55lbs/25KG
MTOW. This will allow the highly specialized development of
advanced delivery, industrial, and defense applications. The Heavy
Lift Flight Testing SFOC allows Draganfly to conduct these
specialized and advanced operations utilizing the Heavy Lift within
an approved flight test area. This development also enables the
Company to initiate direct application and use-case testing.
Draganfly can enhance and optimize highly specialized operational
and maintenance manuals and Standard Operating Procedures for
various conditions and scenarios.
- The Company addressed United
Nations Experts speaking on emerging technologies for disaster risk
reduction organized by the World Meteorological Organization (WMO),
the International Telecommunication Union (ITU), and the United
Nations Convention to Combat Desertification (UNCCD) as part of
ITU’s webinar series on digital transformation. It focused on the
transformative ability of cutting-edge technologies such as
Artificial Intelligence (AI), the Internet of Things (IoT),
Unmanned Aerial Vehicles (UAVs), digital twin, and the Metaverse
and their use in disaster management. This event explored how these
technological innovations can effectively mitigate and respond to
natural hazards and disasters.
- The Company showcased the Commander
3XL and new military special-purpose capabilities at Modern Warfare
Week in Fayetteville, NC. The event is a premier gathering for the
Special Operations Forces (SOF) community, providing a platform for
education and collaboration on the evolving landscape of warfare.
800 select military and government representatives are anticipated
to attend. The Global Special Operations Foundation (GSOF) and the
United States Army Special Operations Command (USASOC) jointly
sponsor the event.
- Draganfly announced the closing of
a US$3.5 million underwritten offering, with the Company planning
to allocate the net proceeds towards general corporate purposes.
These purposes included funding its capabilities to meet the demand
for its new products, supporting growth initiatives, covering
working capital requirements, continuing the development and
marketing of the Company's core product, potential acquisitions,
and research and development efforts.
- Draganfly announced record
third-quarter results for 2023, recording revenue of $2,138,017,
which marked a 14.0% increase from the same period the previous
year. The revenue for Q3 of 2023 comprised product sales amounting
to $1,653,111 and drone services totalling $484,906. This
performance was compared to the Q3 revenue in 2022, which stood at
$1,876,221, consisting of $1,359,986 from product sales and
$516,235 from drone services, highlighting the Company's growth and
expansion in its market segments.
Draganfly will hold a shareholder update call on
March 27, 2024, at 2:30 p.m. PDT / 5:30 p.m. EDT. Registration for
the call can be done here.
Selected financial information is outlined below
and should be read with Draganfly’s consolidated financial
statements for the quarter ended December 31, 2023 and associated
management discussion and analysis, which will be available under
the Company's profile on SEDAR+ at www.sedarplus.ca and filed on
EDGAR.
|
|
|
|
|
|
|
|
|
For the year ended December 31, |
|
2023 |
|
|
2022 |
|
|
2021 |
|
|
Total revenues |
$ |
6,554,842 |
|
$ |
7,605,059 |
|
$ |
7,053,965 |
|
| Gross Profit (as a % of
revenues) (1) |
|
31.5 |
% |
|
10.4 |
% |
|
37.5 |
% |
| Net (loss) income |
|
(23,611,810 |
) |
|
(27,654,364 |
) |
|
(16,202,972 |
) |
| Net (loss) income per share
($) |
|
|
|
|
|
|
|
|
|
(0.56 |
) |
|
(0.82 |
) |
|
(0.58 |
) |
|
|
|
(0.56 |
) |
|
(0.82 |
) |
|
(0.58 |
) |
| Comprehensive (loss)
income |
|
(23,709,851 |
) |
|
(27,305,305 |
) |
|
(16,399,137 |
) |
| Comprehensive (loss) income
per share ($) |
|
|
|
|
|
|
|
|
|
(0.56 |
) |
|
(0.81 |
) |
|
(0.59 |
) |
|
|
|
(0.56 |
) |
|
(0.81 |
) |
|
(0.59 |
) |
| Change
in cash and cash equivalents |
$ |
(4,801,169 |
) |
$ |
(15,180,932 |
) |
$ |
21,093,297 |
|
(1) Gross Profit (as a % of revenues) would have
been 36.5% (2022 – 36.4%; 2021 – 37.5%) not including a non-cash
write down of inventory for $331,671 (2022 - $1,976,514; 2021 -
$nil)).
|
As at |
|
|
|
|
|
December 31, 2023 |
|
December 31, 2022 |
| Total assets |
|
|
|
|
$ |
8,330,292 |
|
$ |
14,638,533 |
| Working capital |
|
|
|
|
|
(717,017 |
) |
|
10,168,800 |
| Total non-current
liabilities |
|
|
|
|
|
523,584 |
|
|
249,740 |
| Shareholders’ equity |
|
|
|
|
$ |
407,716 |
|
$ |
11,040,881 |
| |
|
|
|
|
|
|
|
|
| Number
of shares outstanding |
|
49,229,563 |
|
|
34,270,579 |
Shareholders’ equity and working capital as at
December 31, 2023, includes a fair value of derivative liability of
$4,196,125 ($57,314 – 2022) and would otherwise be $4,603,841
($11,098,195 – 2022) and $3,479,108 ($10,226,114 - 2022)
respectively.
|
|
|
2023 Q4 |
|
2023 Q3 |
|
2022 Q4 |
|
Revenue |
$ |
916,299 |
|
$ |
2,138,018 |
|
$ |
1,314,162 |
|
|
Cost of goods sold(2)(4) |
$ |
(657,420 |
) |
$ |
(1,243,334 |
) |
$ |
(2,980,133 |
) |
|
Gross profit(3)(5) |
$ |
258,879 |
|
$ |
894,683 |
|
$ |
(1,665,971 |
) |
|
Gross margin – percentage |
|
28.3 |
% |
|
41.8 |
% |
|
-126.8 |
% |
|
Operating expenses |
$ |
(3,482,141 |
) |
$ |
(6,356,138 |
) |
$ |
(7,342,669 |
) |
|
Operating income (loss) |
$ |
(3,223,262 |
) |
$ |
(5,461,456 |
) |
$ |
(9,008,640 |
) |
|
Operating loss per share - basic |
$ |
(0.08 |
) |
$ |
(0.13 |
) |
$ |
(0.26 |
) |
|
Operating loss per share - diluted |
$ |
(0.08 |
) |
$ |
(0.13 |
) |
$ |
(0.26 |
) |
|
Other income (expense)^ |
$ |
(965,072 |
) |
$ |
14,569 |
|
$ |
(7,575,889 |
) |
|
Change in fair value of derivative liability (1) |
$ |
153,798 |
|
$ |
- |
|
$ |
334,016 |
|
|
Other comprehensive income (loss) |
$ |
(3,461 |
) |
$ |
(83,363 |
) |
$ |
(76,073 |
) |
|
Comprehensive income (loss) |
$ |
(4,191,796 |
) |
$ |
(5,530,248 |
) |
$ |
(16,660,602 |
) |
|
Comprehensive income (loss) per share - basic |
$ |
(0.10 |
) |
$ |
(0.13 |
) |
$ |
(0.49 |
) |
|
Comprehensive income (loss) per share - diluted |
$ |
(0.10 |
) |
$ |
(0.13 |
) |
$ |
(0.49 |
) |
(1) Included in other income (expense).(2) Cost
of goods sold includes non-cash inventory write-downs of $8,600 in
Q3/23 and $123,454 in Q4/23 and would have been $1,234,734 in Q3/23
and $533,996 in Q4/23 before these write-downs(3) Gross profit
would have been $903,283 in Q3/23 and $382,303 in Q4/23 without the
write-downs(4) Cost of goods sold in Q4/22 would have been
$1,003,619 not including a non-cash write-down of inventory for
$1,976,514.(5) Gross profit would have been $310,543 in Q4/22 not
including a non-cash write-down of inventory for $1,976,514.
^ The other income (expense) and comprehensive
loss for the fourth quarter of 2023 includes non-cash changes
comprised of a fair value derivative liability gain of $153,798 and
would otherwise be another expense of $1,118,870 and comprehensive
loss of $4,345,594, respectively
As previously disclosed, on September 22, 2023,
the Company received a letter from the Listing Qualifications
Department of the Nasdaq Stock Market (“Nasdaq”) notifying the
Company of its noncompliance with Nasdaq Listing Rule 5550(a)(2)
(the “Rule”) by failing to maintain a minimum bid price for the
Company’s common shares of at least $1.00 per share for 30
consecutive business days. The Company was allowed an initial
180-day grace period, or until March 20, 2024, (the “Compliance
Period”), to regain compliance with the Rule. To regain compliance
with the Rule the closing bid price of the Company’s
common shares needed to be at least $1.00 per share for a minimum
of ten consecutive business days during the Compliance Period.
On March 21, 2024, the Company received
notification that it had failed to regain compliance with the Rule
and is not eligible for a second 180 day compliance
period because of its failure to comply with the $5 million
minimum stockholders’ equity initial listing requirement for the
period ended September 30, 2023. Unless the Company timely requests
a hearing before an independent Nasdaq Hearings Panel (the
“Panel”), the Company’s securities will be subject to
delisting. Accordingly, the Company will request a hearing before
the Panel. The hearing request will automatically stay any
suspension or delisting action pending the hearing and the
expiration of any additional extension period granted by the
Panel following the hearing. In that regard, pursuant to the Nasdaq
Listing Rules, the Panel has the discretion to grant an additional
extension period that can expire as late as September 17, 2024. At
the hearing, the Company will be asked to provide a plan to
regain compliance to the Panel. The Company intends to present a
plan to regain compliance with the Rule and request the continued
listing of its common shares on Nasdaq pending such compliance.
However, there can be no assurance that the Panel will grant
the Company’s request or that the Company will ultimately regain
compliance with all applicable requirements for continued listing
on Nasdaq.
About Draganfly
Draganfly Inc. (NASDAQ: DPRO; CSE: DPRO; FSE:
3U8) is the creator of quality, cutting-edge drone solutions,
software, and AI systems that revolutionize how organizations can
do business and service their stakeholders. Recognized as being at
the forefront of technology for over 24 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.
For more information on Draganfly, please visit us
at www.draganfly.com.For additional investor information,
visit https://www.thecse.com/en/listings/technology/draganfly-inc, https://www.nasdaq.com/market-activity/stocks/dpro,
or https://www.boerse-frankfurt.de/aktie/draganfly-inc.
Media ContactArian Hopkinsemail: media@draganfly.com
Company ContactEmail: info@draganfly.com
Note Regarding Non-GAAP Measures
In this press release, we describe certain
income and expense items that are unusual or non-recurring. There
are terms not defined by International Financial Reporting
Standards (IFRS). Our usage of these terms may vary from the usage
adopted by other companies. Specifically, gross profit and gross
margin are undefined terms by IFRS that may be referenced herein.
We provide this detail so that readers have a better understanding
of the significant events and transactions that have had an impact
on our results.
Throughout this release, reference is made to
“gross profit,” and “gross margin,” which are non-IFRS measures.
Management believes that gross profit, defined as revenue less
operating expenses, is a useful supplemental measure of operations.
Gross profit helps provide an understanding on the level of costs
needed to create revenue. Gross margin illustrates the gross profit
as a percentage of revenue. Readers are cautioned that these
non-IFRS measures may not be comparable to similar measures used by
other companies. Readers are also cautioned not to view these
non-IFRS financial measures as an alternative to financial measures
calculated in accordance with International Financial Reporting
Standards (“IFRS”). For more information with respect to financial
measures which have not been defined by GAAP, including
reconciliations to the closest comparable GAAP measure, see the
"Non-GAAP Measures and Additional GAAP Measures" section of the
Company’s most recent MD&A which is available on SEDAR.
Forward-Looking Statements
This release contains certain “forward-looking
statements” and certain “forward-looking information” as defined
under applicable securities laws. Forward-looking statements and
information can generally be identified by the use of
forward-looking terminology such as “may”, “will”, “expect”,
“intend”, “estimate”, “anticipate”, “believe”, “continue”,
“plans” or similar terminology. Forward-looking statements and
information are based on forecasts of future results, estimates of
amounts not yet determinable and assumptions that, while believed
by management to be reasonable, are inherently subject to
significant business, economic and competitive uncertainties and
contingencies. These statements include, but may not be limited
to statements regarding; the impact of the Company receiving the
SFOC for its Heavy Lift Drone; expected attendance and the impact
of the Company showcasing the Commander 3XL at Modern Warfare
Week; the expected use of proceeds in connection with the US$3.5
million underwritten offering; statements regarding the Nasdaq
delisting process, including the Company’s intention to request a
hearing, the results of any such hearing, and the Company’s
ability to present a plan to regain compliance with the Rule; and
building technologies, production lines and production
capabilities. Forward-looking statements and information are
subject to various known and unknown risks and uncertainties,
many of which are beyond the ability of the Company to control or
predict, that may cause the Company’s actual results,
performance or achievements to be materially different from
those expressed or implied thereby, and are developed based on
assumptions about such risks, uncertainties and other factors set
out here-in, including but not limited to: the potential impact
of epidemics, pandemics or other public health crises on the
Company’s business, operations and financial condition, the
successful integration of technology, the inherent risks
involved in the general securities markets; uncertainties
relating to the availability and costs of financing needed in the
future; the inherent uncertainty of cost estimates and the
potential for unexpected costs and expenses, currency
fluctuations; uncertainty regarding the Nasdaq hearing process,
regulatory restrictions, liability, competition, loss of key
employees and other related risks and uncertainties disclosed
under the heading “Risk Factors“ in the Company’s most recent
filings filed with securities regulators in Canada on the SEDAR
website at www.sedar.com and with the U.S. Securities and
Exchange Commission on the EDGAR website at www.sec.gov. The
Company undertakes no obligation to update forward-looking
information except as required by applicable law. Such
forward-looking information represents management’s best
judgment based on information currently available. No
forward-looking statement can be guaranteed and actual future
results may vary materially. Accordingly, readers are advised
not to place undue reliance on forward-looking statements or
information.
Grafico Azioni Draganfly (TG:3U8A)
Storico
Da Dic 2024 a Gen 2025
Grafico Azioni Draganfly (TG:3U8A)
Storico
Da Gen 2024 a Gen 2025
