DroneShield (ASX:DRO) share price soars 5% on rapid revenue growth

The company's shares are heading north today.

| More on:
Man puts thumb up next to stock market graph

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The DroneShield Ltd (ASX: DRO) share price is pushing higher during afternoon trade following a business update from the company.

At the time of writing, the defence contractors' shares are up 5.71% to 18.5 cents. In comparison, the All Ordinaries (ASX: XAO) is down 0.21% to 7,757.8 points.

What did DroneShield announce?

Investors are buying up DroneShield shares after the company reported a record performance for 2021.

In its statement to the ASX, DroneShield advised it achieved $10.5 million in revenue last year. This represents a 94% increase when compared against the prior comparable period (FY20 $5.4 million).

In addition, customer and grant cash receipts totalled $14.8 million in 2021, a 174% growth on 2020 levels.

Notably, the company broke new records, despite COVID-19 continuing to impact business operations. The diversity in receipts primarily came from Australia, the United States, and Middle Eastern customers.

This consisted of payments across multiple product lines such as DroneShield's $3.8 million contract with the Australian Department of Defence.

In addition, DroneShield is actively engaging in a potential US$55 million contract with a Middle Eastern customer. Although details are sketchy at this point in time on who the deal is for and what it involves.

The company noted that it has over $200 million in its sales pipeline across the globe. This is a small fraction of the total $6 billion addressable market for counter-drone, electronic warfare and signals intelligence products.

DroneShield declared a healthy cash balance of $9.5 million, with no debt.

Management commentary

Speaking on the outstanding achievement, DroneShield CEO Oleg Vornik said:

2022 is shaping as another record year, with over $200m in sales pipeline diversified across geographies and products, underpinned by our talented staff who are global leaders in their respective technology segments.

We have also taken advantage of our supply chain relationships to secure access to material amounts of complex circuit board and other inventory, which serves as a further differentiator to our customers, reducing final product delivery lead times, in the current environment of supply chain disruptions for much of the industry.

Importantly, Software as a Service (SaaS) and, generally, software-related revenues are expected to continue increasing as total percentage of customer cash receipts.

About the DroneShield share price

Over the last 12 months, the DroneShield share price has pushed marginally higher by around 3%.

The company's shares reached a 52-week high of 22.55 cents in September last year, before treading lower.

At today's price, DroneShield presides a market capitalisation of around $77.37 million, with approximately 418.23 million shares on issue.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns and has recommended DroneShield Ltd. The Motley Fool Australia has recommended DroneShield Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Technology Shares

Group of people in a gym high five each other surrounded by gym equipment.
Mergers & Acquisitions

This ASX tech stock is hitting a record high on acquisition news

The market is responding positively to this news. Let's dig deeper into it.

Read more »

A man in a suit face palms at the downturn happening with shares today.
Technology Shares

Guess which ASX 300 share is crashing 17% on shock news

Investors are rushing to the exits on Thursday. Let's find out why.

Read more »

Cheerful boyfriend showing mobile phone to girlfriend in dining room. They are spending leisure time together at home and planning their financial future.
Technology Shares

These were the best ASX 200 tech stocks to buy in May

Shareholders of these shares were smiling last month. But why?

Read more »

A woman smiles as she sits on the bus using her phone and listening to music through headphones.
Technology Shares

Here's why I think these ASX tech shares are buys in June

These stocks have loads of potential.

Read more »

A young man wearing a black and white striped t-shirt looks surprised.
Technology Shares

Why did the Life360 share price rocket 51% in May?

This ASX 200 stock smashed the market last month with an incredible gain.

Read more »

Man ponders a receipt as he looks at his laptop.
Technology Shares

Up 30% since April, are Xero shares still a buy?

Xero shares have surged 30% since April, but can this SaaS leader's share price keep rising?

Read more »

A man and a woman sitting in a technology-related work environment high five each other while the man wears headphones around his neck and the woman sits in front of a laptop.
Share Market News

Strong gains for Wisetech, TechnologyOne, and Catapult amid ASX 200 tech sector lead

ASX technology shares led the market with a 3.85% increase while the ASX 200 lifted 0.88% last week.

Read more »

group of traders cheering at stock market
Technology Shares

Codan shares near an all time high. Can they go higher?

Is there more room for growth for this ASX 200 company? 

Read more »