Sales Funnel Pipeline More than $900 Million
ST. JOHN’S, NEWFOUNDLAND, 15 February 2024 — Kraken Robotics Inc. (“Kraken” or the “Company”) (TSX-V: PNG, OTCQB: KRKNF) is updating financial guidance for the year ended December 31, 2023. While audited results will not be released until mid-April, unaudited preliminary results show that the Company’s strong momentum continued from Q3 2023 into Q4 2023. As a result, Kraken Robotics expects to report fiscal 2023 revenue at approximately the midpoint of our $66.0 million and $72.0 million guidance, representing top line growth of about 68% year over year. The Company also expects Adjusted EBITDA(1) toward the higher end of our $12.0 million to $15.0 million guidance, versus Adjusted EBITDA(1) of $5.3 million for the year ended December 31, 2022. Capital expenditures for 2023 are currently anticipated to be approximately $7.5 million, higher than our $5.0 million to $6.0 million guidance due to additional investments in assets for our engineering, customer success and services groups to drive growth in 2024 and beyond.
MANAGEMENT COMMENTS
“2023 was another strong year for Kraken Robotics, and we anticipate a strong 2024,” said Greg Reid, Kraken President and CEO. “With our contract wins to date and visibility into our sales pipeline, we expect continued strong growth in 2024 and beyond. In the defense market, the macro environment is robust as countries adapt to the new geopolitical norm to monitor and protect critical underwater infrastructure and territories. We are winning new customers and selling more products and services to existing customers. In the commercial market, we expect continued solid growth driven by offering services to companies focused on offshore wind and offshore energy.”
STRONG OUTLOOK FOR 2024 BACKED BY EXISTING CONTRACTS AND PIPELINE
For 2024, we currently expect revenue between $90.0 million to $100.0 million and Adjusted EBITDA(1) in the $18.0 million to $24.0 million range. Capital expenditures in 2024 are expected to range from $6.0 million to $7.0 million. Our 2024 outlook is largely driven by contracts in hand and reflects strength across both our Products and Services groups addressing defense and offshore energy customers.
Going forward, the Company is introducing information on our sales funnel pipeline to help investors better understand the underlying growth trends in our markets served and to show how Kraken’s products and services are performing. We will provide the sales funnel information on an annual basis at the beginning of each year. Ultimately our success will be determined by continuing to convert our sales pipeline to new orders and successfully executing on these projects and programs. Our total sales pipeline is a combination of opportunities across three areas: sonar products and programs, subsea power, and subsea services.
Kraken’s sales funnel pipeline at the end of December 2023 was over $900 million. On major sonar programs, we experience competition from a small number of companies, and Kraken often is included on multiple bid teams as various consortiums bid these navy programs. For subsea batteries, we are often the sole source provider of lithium-ion batteries to our uncrewed underwater vehicle (UUV) customers. In this market, the emergence of a new larger class of UUV, the Extra Large UUV (XLUUV) is driving increased volumes. For subsea services, our solutions are used by naval, offshore wind and offshore oil and gas customers to provide high resolution acoustic imagery of the seabed and sub-seabed, providing actionable intelligence on critical underwater infrastructure and territories. all”.
ABOUT KRAKEN ROBOTICS
Kraken Robotics Inc. (TSX:PNG) is a marine technology firm specialising in advanced sonar and optical sensors, underwater batteries, and robotic systems for unmanned underwater vehicles (UUVs). Launched in Canada in 2012, with what started as an eight-person team a decade ago has now evolved into a 250-person organization with employees based in North America, South America, and Europe, with plans to expand further across the globe.
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.
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