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 third
quarter financial results.
Key Financial and Operational Highlights for Q3
2024:
- Revenue for the third quarter of
2024 was $1,885,322 which represents an 8.9% quarter over quarter
increase. Product sales of $1,328,675 made up the bulk of the
revenue with the remainder coming from drone services. This is
compared to total Q3 revenue in 2023 of $2,138,017.
- Gross profit for Q3 2024 was
$440,780 which represents a 4.5% decrease quarter over quarter and
was down 50.7% over the same period in 2023. Gross margin
percentage for Q3 2024 was 23.4% down from 41.8% in Q3 2023. Gross
profit would have been $617,202 and gross margin would have been
32.7%, not including a one-time write down of inventory of
$176,422. The decrease is due to the sales mix of the products
sold.
- The Company recorded a
comprehensive loss of $364,549 in the third quarter of 2024
compared to a comprehensive loss of $5,530,248 in the third quarter
of 2023. The comprehensive loss for the period includes non-cash
changes comprised of a positive change in fair value derivative of
$3,575,559, a write down of inventory of $176,422, and an
impairment gain on notes receivable of $7,564 and would otherwise
be a comprehensive loss of $3,771,250. Contributors to the
year-over-year decrease are lower office and miscellaneous
expenses, professional fees, research and development costs, and
wages.
- Cash balance on September 30,2024
of $3,997,577 compared to $3,093,612 on December 31, 2023.
- On August 23, 2024, the Board
approved a 1-for-25 share consolidation, effective September 5,
2024, aimed at enhancing share value and market positioning. This
strategic move is intended to attract a broader range of investors
and improve the Company's standing in the financial markets.
- On September 10, 2024, Draganfly
unveiled the APEX Drone, tailored for military and law enforcement
surveillance, showcasing the Company's commitment to cutting-edge
solutions. The APEX Drone is designed to provide enhanced aerial
intelligence, offering advanced features that meet the stringent
requirements of defense and security operations.
- On September 17, 2024, Draganfly
partnered with Nightingale Security to develop an autonomous
drone-in-a-box remote sensing solution for a major oil and gas
company, underscoring its versatility across industries. This
collaboration aims to deliver a fully automated, real-time
monitoring system, enhancing safety and operational efficiency in
the energy sector.
- On September 24, 2024, the Company
received a purchase order for its Commander 3XL drone, designated
for logistics within various branches of the U.S. Department of
Defense, highlighting Draganfly's expanding role in defense
applications. The Commander 3XL is expected to streamline
logistical operations, providing reliable and efficient aerial
transport capabilities in complex environments.
Draganfly will hold a shareholder update and earnings call on
November 14, 2024 at 2:30 p.m. PDT / 5:30 EDT pm.
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 September 30, 2024, 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 at www.sec.gov.
|
|
Three months ended September 30, |
Nine months ended September 30, |
|
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
|
Total revenues |
$ |
1,885,322 |
|
$ |
2,138,017 |
|
$ |
4,947,894 |
|
$ |
5,638,542 |
|
| Gross Margin (as a % of
revenues) (1) |
|
23.4 |
% |
|
41.8 |
% |
|
23.9 |
% |
|
32.0 |
% |
| Net income (loss) |
|
(200,194 |
) |
|
(5,446,885 |
) |
|
(9,155,551 |
) |
|
(19,423,475 |
) |
| Net income (loss) per share
($) |
|
|
|
|
|
|
|
|
|
|
|
(0.06 |
) |
|
(3.13 |
) |
|
(3.28 |
) |
|
(11.99 |
) |
|
|
|
(0.06 |
) |
|
(3.13 |
) |
|
(3.28 |
) |
|
(11.99 |
) |
| Comprehensive income
(loss) |
|
(364,549 |
) |
|
(5,530,248 |
) |
|
(9,346,603 |
) |
|
(19,518,055 |
) |
| Comprehensive income (loss)
per share ($) |
|
|
|
|
|
|
|
|
|
|
|
(0.11 |
) |
|
(3.18 |
) |
|
(3.35 |
) |
|
(12.05 |
) |
|
|
|
(0.11 |
) |
|
(3.18 |
) |
|
(3.35 |
) |
|
(12.05 |
) |
| Change
in cash and cash equivalents |
$ |
(1,292,970 |
) |
|
(4,264,040 |
) |
$ |
903,965 |
|
$ |
(5,437,697 |
) |
(1) Gross Profit (as a % of revenues) would have
been 32.7% and 42.2% not including a non-cash write down of
inventory for $176,422 and $8,600 respectively for the three-month
period ending September 30, 2024 and 2023. Gross Profit (as a % of
revenues) would have been 33.2% and 35.7% not including a non-cash
write down of inventory for $459,591 and $208,247 respectively for
the nine-month period ending September 30, 2024 and 2023.
|
As at |
|
|
|
|
|
September 30, 2024 |
|
December 31, 2023 |
| Total assets |
|
|
|
|
$ |
8,528,719 |
$ |
8,330,292 |
|
| Working capital |
|
|
|
|
|
3,549,345 |
|
(717,017 |
) |
| Total non-current
liabilities |
|
|
|
|
|
382,520 |
|
523,584 |
|
| Shareholders’ equity |
|
|
|
|
$ |
4,360,959 |
$ |
407,716 |
|
| Number
of shares outstanding |
|
3,825,208 |
|
1,969,183 |
|
(1) Shareholders’ equity and working capital as
at September 30, 2024, includes a fair value of derivative
liability of $1,252,005 (2023 - $4,196,125) and would otherwise be
$5,612,964 (2023 - $4,603,841) and $4,801,350 (2023 - $3,479,108),
respectively.
|
|
|
2024 Q3 |
|
2024 Q2 |
|
2023 Q3 |
|
Revenue |
$ |
1,885,322 |
|
$ |
1,732,990 |
|
$ |
2,138,017 |
|
|
Cost of sales(2) |
$ |
(1,444,542 |
) |
$ |
(1,271,317 |
) |
$ |
(1,243,334 |
) |
|
Gross profit(3) |
$ |
440,780 |
|
$ |
461,673 |
|
$ |
894,683 |
|
|
Gross margin – percentage |
|
23.4 |
% |
|
26.6 |
% |
|
41.8 |
% |
|
Operating expenses |
$ |
(4,125,078 |
) |
$ |
(4,395,923 |
) |
$ |
(6,356,139 |
) |
|
Operating income (loss) |
$ |
(3,684,298 |
) |
$ |
(3,934,250 |
) |
$ |
(5,461,456 |
) |
|
Operating loss per share - basic |
$ |
(1.10 |
) |
$ |
(1.38 |
) |
$ |
(3.14 |
) |
|
Operating loss per share - diluted |
$ |
(1.10 |
) |
$ |
(1.38 |
) |
$ |
(3.14 |
) |
|
Other income (expense) |
$ |
3,484,104 |
|
$ |
(3,157,299 |
) |
$ |
14,571 |
|
|
Change in fair value of derivative liability (1) |
$ |
3,575,559 |
|
$ |
(2,604,394 |
) |
$ |
- |
|
|
Other comprehensive income (loss) |
$ |
(164,355 |
) |
$ |
(6,089 |
) |
$ |
(83,363 |
) |
|
Comprehensive income (loss) |
$ |
(364,549 |
) |
$ |
(7,097,638 |
) |
$ |
(5,530,248 |
) |
|
Comprehensive income (loss) per share - basic |
$ |
(0.11 |
) |
$ |
(2.51 |
) |
$ |
(3.18 |
) |
|
Comprehensive income (loss) per share - diluted |
$ |
(0.11 |
) |
$ |
(2.51 |
) |
$ |
(3.18 |
) |
(1) Included in other income (expense).(2) Cost
of goods sold would have been $1,268,120 in Q3 2024 not including a
non-cash write down of inventory for $176,422. For the comparative
quarters cost of goods sold not including inventory write-downs of
$8,600 in Q3 2023 and $134,410 for Q2 2024 would have been
$1,234,734 in Q3 2023 and $1,136,907 in Q2 2024 before these write
downs.(3) Gross profit would have been $617,202 not including a
one-time non-cash write down of inventory for $176,422 (2023 -
$8,600). Gross profit would have been $903,283 in Q3 2023 and
596,083 in Q2 2024 without the write downs.
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 the way 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, public
health, mining, 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 The CSENASDAQFrankfurt
Media ContactErika RacicotEmail:
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 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 Canadian 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. Forward-looking statements in this news release
include statements relating to the anticipated impact of the
consolidation, the expected results of Draganfly’s partnership
with Nightingale Security, the purchase order for and performance
of the Commander 3XL drone, 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 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; 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.sedarplus.ca. The Company
undertakes no obligation to update forward-looking information
except as required by applicable law. Such forward-looking
information represents managements’ 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.
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