Home Technical Kraken Robotics predicts 100% growth in 2021due to recent contract wins

Kraken Robotics predicts 100% growth in 2021due to recent contract wins

Kraken Robotics, Canada’s Ocean Company, is providing the following preliminary guidance on estimated financial results for the three months ended March 31, 2021, as well as our financial guidance for the year ending December 31, 2021. Our unaudited financial results for the three months ending March 31, 2021, have not yet been finalized and are subject to change.

2021 Financial Guidance

  • Revenue for the year ended December 31, 2021 is expected to be $24.0 million to $28.0 million versus $12.3 million in 2020. The greater than 100% expected growth is due to recent contract wins for KATFISH™ 180 towed sonars and ALARS for the Danish and Polish Navies, and various orders and expected orders for AquaPix® MINSAS and SeaPower™ batteries. We have strong visibility into 2021, with contracts already signed accounting for more than 80% of the $26 million midpoint of our 2021 revenue forecast range.
  • Our revenue guidance excludes any contribution from the proposed acquisition of PanGeo which we announced on April 9, 2021. Upon completion of this proposed acquisition, we will update our guidance to account for expected PanGeo results.
  • Gross margins for 2021 are expected to be in the 47%-50% range versus 47% in 2020.
  • Adjusted EBITDA for 2021 expected to be in the range of $2.0 million to $4.5 million compared to an Adjusted EBITDA loss of $2.7 million in 2020. The year over year improvement is expected as a result of higher revenue offset by increased expenses on headcount and infrastructure related spending, and overall costs due to the growth of the business.
  • Net income for 2021 is expected to range from a net loss of $1.5 million to net income of $1.5 million. This compares to a net loss of $5.5 million in 2020.

Q1/2021 Preliminary Guidance

  • Revenue for the three months ended March 31, 2021 is expected to be approximately $3.6 million versus $6.4 million in the prior year’s quarter. Key revenue components in the quarter were initial work on the Danish and Polish Navy KATFISH™ 180 towed sonar contracts and the shipment of SeaPower™ batteries to a Navy customer. Prior year revenue was driven by the sale of a KATFISH™ 180 system and subsea batteries to a military customer.
  • Gross margins for Q1, 2021 are expected to be 60% compared to 46% in Q1, 2020.
  • Adjusted EBITDA for the quarter is expected to be in the range of $0.1 million to $0.6 million, compared to Adjusted EBITDA * of $1.3 million in the prior year. The year over year change was due to lower revenue combined with an increase in expenses as we ramped headcount, infrastructure related spending, and overall costs to be able to shorten customer lead times and deliver on larger program wins such as the Danish Navy order.
  • Net loss for the quarter is expected to be $0.1 million to $0.6 million compared to a net income of $0.7 million in the prior year quarter.
  • Kraken expects to report final Q1, 2021, results on or about May 27th.

CEO Comments

President & CEO Comments

“Our product sales pipeline is very robust and we expect more than 100% top line growth in 2021,” said CEO Karl Kenny. “This, combined with the maturing of Kraken’s service capabilities and the proposed acquisition of PanGeo Subsea, provides a strong platform for growth in 2021 and beyond. As our top line growth continues and we near completion of major R&D programs in 2022 (multispectral SAS and ThunderFish® XL), we expect to see an acceleration in operating leverage with targeted EBITDA margins in the 30%-35% range from a balance of product sales and recurring services revenue.”