June 1, 2020

ST. JOHN’S, NEWFOUNDLAND, June 1, 2020 /GLOBE NEWSWIRE/ — 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.

 

ABOUT KRAKEN ROBOTICS INC.

 

Kraken Robotics Inc. (TSX.V:PNG) (OTCQB: KRKNF) is a marine technology company dedicated to the production and sale of software-centric sensors, subsea batteries and thrusters, and underwater robotic systems. The company is headquartered in St. John’s, Newfoundland with offices in Dartmouth, Nova Scotia; Toronto, Ontario; Bremen & Rostock, Germany; and Boston, Massachusetts. 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:

Joe MacKay, Chief Financial Officer

(416) 303-0605

jmackay@krakenrobotics.com

 

Greg Reid, Chief Operating Officer

(416) 818-9822

greid@krakenrobotics.com

 

Sean Peasgood, Investor Relations

(647) 955-1274

sean@sophiccapital.com

 

Shauna Cotie, Marketing Manager

(709) 757-5757 x 241

scotie@krakenrobotics.com

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