Kraken Robotics Inc (KRKNF)

[The_Gman]

Kraken Reports Strong Q1 2020 Results - 367% Growth!!

Canada’s Ocean Company Reports Record Profitability Revenue growth of 367% and Adjusted EBITDA Margin of 20%

https://krakenrobotics.com/kraken-reports-strong-q1-2020-results/

Kraken Robotics Inc. (TSX-V: PNG, OTCQB: KRKNF), Canada’s Ocean Company, announced it has filed its financial results for the quarter ended March 31, 2020. Additional information concerning the Company, including its consolidated financial statements and related management’s discussion and analysis (“MD&A”) for the quarter ended March 31, 2020, can be found at www.sedar.com. Unless otherwise stated, all dollar amounts are Canadian dollar denominated.

Q1 2020 Financial Highlights

Revenue for the quarter was $6.4 million compared to $1.4 million in the year ago quarter. Revenue in the quarter was driven by the delivery of a KATFISH™ 180 system, additional subsea batteries to a military customer, acoustic signal processing software for a defense contractor as well as Robotics as a Service and data analytics for offshore energy customers.
Adjusted EBITDA* in the quarter was positive at $1.3 million, a 20.2% Adjusted EBITDA margin* compared to an Adjusted EBITDA* loss of $0.3 million in the year ago quarter.
Net Income in the quarter was $0.7 million compared to a net loss of $0.9 million in the year ago quarter. Share-based compensation expense in the quarter of $0.2 million compared to $0.1 million in the prior year.
Net working capital at the end of Q1, 2020 was $8.2 million, up $1.0 million sequentially from year end 2019.
Kraken exited the quarter with a cash balance of $2.1 million, flat as compared to December 31, 2019. Due to increased sales during the quarter, accounts receivable increased to $5.7 million, compared to $5.1 million at December 31, 2019. Subsequent to the quarter, Kraken’s credit line was increased to $1.5 million from $1.0 million and remains undrawn.
Including federal funding we will receive for our OceanVision project, Kraken had $6.2 million in previously awarded funding to draw upon from government This amount is not recorded in our financial statements until the cash is received.

CEO Comments

“Q1 2020 was an extremely well-balanced quarter for Kraken. We delivered our second KATFISH™ system to ThayerMahan, delivered on a second order of subsea batteries to a military customer and provided services to both military and offshore energy customers. These combined deliveries not only led to 367% year-over-year revenue growth, it led to a third quarter in a row with positive Adjusted EBITDA at $1.3 million, a 20% Adjusted EBITDA margin, and our first positive net income quarter at $0.7 million. I am very proud of our team which has been executing extremely well in a challenging operating environment.” said Karl Kenny, Kraken’s President and CEO. “We have many high value projects we are pursuing which will continue to drive growth and value for shareholders.”

COVID-19

While we are not currently experiencing major impacts from the Coronavirus pandemic, we are aware that this could affect our supply chain, customers, employees, and operations. This could impact the number of contracts we close, sales cycle lengths, and our ability to deliver product and services in a timely manner. We will continue to prudently monitor the situation and manage our business accordingly.

*Adjusted EBITDA and Adjusted EBITDA margin do not have standardized meaning under IFRS and may not be comparable to similar measures used by other issuers. We define Adjusted EBITDA as revenue less costs of sales, administrative expenses, research and development costs plus investment tax credits. We define Adjusted EBITDA margin as Adjusted EBITDA divided by revenues.