Droneshield (ASX: DRO) – counter-drone solutions
COMPANY SCOREBOARD
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ABOUT COMPANY
DroneShield (DRO) (https://www.droneshield.com/) specialises in counter-drone solutions. Its unique products use proprietary software and hardware to detect drones in a combination of radiofrequency (RF), radar, optical camera, thermal camera-based systems, acoustic sensors, and smart jamming technologies.
CAPITAL STRUCTURE
| ASX Code | Share Price | Shares | Option (In) | Market Cap | Cash/Asset ($m) |
| DRO | 0.855 | 616503611 | 30970000 | 553589937.405 | 42.4/0 |
| Holders No | Top 20 (Cur) | Top 20 (Pre) | Director Hold | Performance Right | Note |
| 11853 | 35.86% | 36.76% | 2.96% | last raise $40.3m@30c; pre raise $3.7m@20c |
In FY21, the directors exercised 19.5m options at Zero cost.
In FY23, the directors received another 16.5m options and sold 23.6m shares on market.
BUSINESS
Below is the company’s past five years performance:
| DRO | 2023 | 2022 | 2021 | 2020 | 2019 |
| Operation Revenue | 55078 | 16886 | 10598 | 5558 | 3521 |
| Cost of Sale | -15137 | -4976 | -2849 | -1827 | -1611 |
| Gross Revenue | 39941 | 11910 | 7749 | 3731 | 1910 |
| Gross Margin | 0.7252 | 0.7053 | 0.7312 | 0.6713 | 0.5425 |
| Overheads | -36388 | -15111 | -14493 | -10807 | -10184 |
| Fixed Overheads | |||||
| Variable Overheads | |||||
| Total Operation Expense | -36388 | -15111 | -14493 | -10807 | -10184 |
| Operation Profit | 3553 | -3201 | -6744 | -7076 | -8274 |
| Other Revenue | 674 | 369 | 482 | 335 | 72 |
| Interest Expense | |||||
| D&A | |||||
| Income Tax | 6168 | 1980 | 1088 | 485 | |
| Net Profit | 10395 | -852 | -5174 | -6741 | -7717 |
| NOTES | $5.3m share payment | $0.7m share payment | $1.1m share payment | $2.5m share payment | $1.8m share payment |
The directors have taken lots of share-based payments without much corporate governance. Additionally, it doesn’t file any patent due to the requirement to publish the “secret sauce” as part of a patent filing.
SUMMARY
I think there are lots of “fat” in the “Product Development Expense”.
If the Ukraine war wouldn’t lift the share price, not many other circumstances perhaps will.
The company used $20m sale in 1HFY23 to lift the share price by 100%, but also raised some $40m cash at high price. I think that’s it for the hype.