ParaZero Announced First Half 2023 Financial Results
Revenues increased 137%; company completed a $7.8 Million Initial Public Offering in July 2023
TEL AVIV, Israel, Sept. 22, 2023 (GLOBE NEWSWIRE) -- ParaZero Technologies Ltd. (Nasdaq: PRZO) (“ParaZero”), an aerospace company focused on drone safety systems for commercial drones and urban air mobility aircraft, reported unaudited financial results for first six months ended on June 30, 2023. Revenues for the first half of 2023 amounted to $344,819, increasing 137% compared to $145,093 in the same period last year.On July 31, 2023, the company closed its $7.8 million initial public offering.
*Recent Corporate Highlights:*
· The company announced a purchase order received by an autonomous aerial vehicles original equipment manufacturer (“OEM”), based in the United Arab Emirates. The OEM focuses on air taxi and cargo drone solutions.
· The company received a second order for its custom drones safety system by one of the world’s largest automotive manufacturers.
· ParaZero launched the SafeAir M350 Pro and the SafeAir M30 Pro for DJI's New Enterprise Drones.
· Expanded to the Latin American drone market with a new development agreement with Colombia-based drone OEM, Black Square, an industrial drone producer leader in the region that focuses on enterprise drone platforms.
· One of the company's customers, Speedbird Aero, a world-leading innovator in drone delivery technology development and service provision, has achieved a significant milestone by successfully completing 10,000 operational delivery flights.
· The company announced its next-generation safety product development, SmartAir Trinity, an AI-based avionics system, which utilizes a new, leading-edge sensor array with advanced capabilities, designed to detect malfunctions of UAS and eVTOL in real-time, and provide deep analytics for mission debriefings.
· Parazero announced that the U.S. Federal Aviation Administration has granted the Airobotics Optimus-1EX system an airworthiness Type Certification, a historic milestone that will streamline continuous operational approvals for broad flight operations, including fully autonomous missions, operations over people, and beyond visual line of sight operations.
"After completing our initial public offering at the end of July, the company intensified its sales and marketing initiatives. This led to forging alliances with top industry partners and increased recognition among leading players in the drone and air mobility sector," said Boaz Shetzer, chief executive officer of ParaZero. "Over the recent months, we have consistently broadened our product range, introducing new safety systems for prevalent drone models. Additionally, we've tailored innovative systems to meet the unique requirements of our clients."
"As momentum builds in the drone and air mobility sectors, we see our role as pivotal in addressing regulatory challenges. This facilitates more companies in deploying and operating their drones, especially in the promising areas of deliveries and air mobility taxis," concluded Shetzer.
*First Half 2023 Financial Results*
· Revenues for the six months ended June 30, 2023 were $344,819, increasing 137% compared to $145,093 in the same period last year.
· Gross profit for the first half of 2023 amounted to 150,714, compared to 16,658 in the first half of 2022.
· Research and development expenses, for the six months ended June 30, 2023 were $216,181, compared to $307,396 in the same period last year.
· Sales and marketing expenses for the six months ended June 30, 2023, were $94,339, compared to $135,585 for the six months ended June 30, 2022.
· General and administrative expenses for the six months ended June 30, 2023 were $101,877, compared to $327,415 in the same period last year.
· Prospective initial public offering expenses for the six months ended June 30, 2023, were $106,754, compared to $405,777 in the same period last year.
· Net loss for the first half of 2023 was $433,324, or $0.12 per ordinary share, compared to a net loss of $948,376 or $0.31 per ordinary share, in the same period last year.
· Cash totaled $84,945 as of June 30, 2023, compared to $89,806 as of December 31, 2022. On July 31, 2023, the company closed its $7.8 Million initial public offering.
*About ParaZero Technologies*
ParaZero ( https://parazero.com/ ) is a world-leading developer of autonomous parachute safety systems for commercial drone and urban air mobility (UAM) aircraft. Started in 2014 by a passionate group of aviation professionals and drone industry veterans, ParaZero designs smart, autonomous parachute safety systems designed to enable safe flight operations overpopulated areas and beyond-visual-line-of-sight (BVLOS).
*Forward-Looking Statements*
This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act and other securities laws. Words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates” and similar expressions or variations of such words are intended to identify forward-looking statements. For example, the Company is using forward-looking statements when it discusses the momentum in the drone and air mobility sectors, the Company’s role in addressing regulatory challenges and more companies deploying and operating. Forward-looking statements are not historical facts, and are based upon management’s current expectations, beliefs and projections, many of which, by their nature, are inherently uncertain. Such expectations, beliefs and projections are expressed in good faith. However, there can be no assurance that management’s expectations, beliefs and projections will be achieved, and actual results may differ materially from what is expressed in or indicated by the forward-looking statements. Forward-looking statements are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in the forward-looking statements. For a more detailed description of the risks and uncertainties affecting the Company, reference is made to the Company’s reports filed from time to time with the Securities and Exchange Commission (“SEC”), including, but not limited to, the risks detailed in the Company’s final prospectus (Registration No. 333-265178) dated July 26, 2023. Forward-looking statements speak only as of the date the statements are made. The Company assumes no obligation to update forward-looking statements to reflect actual results, subsequent events or circumstances, changes in assumptions or changes in other factors affecting forward-looking information except to the extent required by applicable securities laws. If the Company does update one or more forward-looking statements, no inference should be drawn that the Company will make additional updates with respect thereto or with respect to other forward-looking statements. References and links to websites have been provided as a convenience, and the information contained on such websites is not incorporated by reference into this press release. ParaZero is not responsible for the contents of third-party websites.
*Investor Relations Contact:*
Michal Efraty
Investor Relations, Israel
+972-(0)52-3044404
michal@efraty.com
*CONDENSED INTERIM BALANCE** SHEETS (Unaudited)*
*U.S. dollars *
*June 30,* *December 31,* *2023 * *2022*
ASSETS
*CURRENT ASSETS:*
Cash 84,945 89,806
Trade receivables 18,405 184,064
Other accounts receivable 107,052 179,541
Deferred prospective initial public offering cost 407,749 291,133
Inventories 342,289 304,823 960,440 1,049,367
*TOTAL CURRENT ASSETS*
* NON-CURRENT ASSETS:*
Right-of use asset 32,511 56,893
Property and equipment, net 31,763 41,311
*TOTAL NON-CURRENT ASSETS * 64,274 98,204
*TOTAL ASSETS* 1,024,714 1,147,571
*The accompanying notes are an integral part of these condensed interim financial statements.*
*CONDENSED INTERIM BALANCE** SHEETS (Unaudited)*
*U.S. dollars *
*June 30, * *December 31,* *Note* *2023 * *2022*
* LIABILITIES AND SHAREHOLDERS' DEFICIT*
*CURRENT LIABILITIES:*
Trade payables 98,780 47,260
Lease liabilities 29,152 45,097
Other accounts payable 624,241 774,647
Loan from related party 7 729,169 -
SAFEs 6 1,514,928 1,514,928
*TOTAL CURRENT LIABILITIES* 2,996,270 2,381,932
*NON-CURRENT LIABILITIES:*
Lease liabilities - 7,775
Loan from related party 7 - 399,794
*TOTAL NON-CURRENT LIABILITIES* - 407,569
*COMMITMENTS AND CONTINGENCIES * 4
*SHAREHOLDERS’ DEFICIT*
Ordinary shares, NIS 0.02 par value:
Authorized 25,000,000 as of June 30, 2023
and December 31, 2022; Issued and
outstanding 3,597,442 and 3,597,442 shares
as of June 30,2023 and as of December 31,
2022, respectively 21,456 21,456
Additional paid-in capital 13,091,990 12,988,292
Accumulated losses (15,085,002 ) (14,651,678 )
*TOTAL SHAREHOLDERS’ DEFICIT* (1,971,556 ) (1,641,930 )
*TOTAL LIABILITIES AND SHAREHOLDERS’ DEFICIT* 1,024,714 1,147,571
*The accompanying notes are an integral part of these condensed interim financial statements.*
*CONDENSED INTERIM STATEMENTS OF COMPREHENSIVE LOSS (Unaudited)*
*U.S. dollars *
*Six months
ended*
*June 30,* *Six months *
*ended*
*June 30,* *2023* *2022* * U.S. dollars*
*Sales* 344,819 145,093
Cost of Sales 194,104 128,435
*GROSS PROFIT * 150,714 16,658
Research and development expenses 216,181 307,396
Selling and marketing expenses 94,339 135,585
General and administrative expenses 101,877 327,415
Prospective initial public offering expenses 106,754 405,777
*OPERATING LOSS* 368,436 1,159,515
*Financing Expenses (Income), *net 64,888 (211,139 )
*COMPREHENSIVE AND NET LOSS * 433,324 948,376
*Net loss per ordinary share, basic and diluted * 0.12 0.31
*Weighted average number of ordinary shares outstanding basic and diluted* 3,597,442 3,066,785
*The accompanying notes are an integral part of these condensed interim financial statements.*
*
*
*CONDENSED INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS' DEFICIT** (Unaudited)*
*U.S. dollars **(except for share numbers)*
*Ordinary shares* *Additional* *Number* *paid-in* *Accumulated* *of shares* *Amount* *capital* *losses* *Total* *U.S. dollars* *U.S. dollars*
*BALANCE AS OF
DECEMBER 31, 2021* 359,743 1,945 6,380,403 (12,998,640 ) (6,616,292 )
*CHANGES DURING
THE * *SIX MONTHS
ENDED JUNE* *30,
2022:*
Conversion of
Former Parent
Company's debt
into ordinary shares
and warrants 3,237,699 19,511 6,403,797 - 6,423,308
Stock based
compensation - - 96,916 - 96,916
Comprehensive
loss - - - (948,376 ) (948,376 )
*BALANCE AS OF JUNE
30, 2022* 3,597,442 21,456 12,881,116 (13,947,016 ) (1,044,444 )
*BALANCE AS OF
DECEMBER 31, 2022* 3,597,442 21,456 12,988,292 (14,651,678 ) (1,641,930 )
*CHANGES DURING
SIX MONTHS ENDED
JUNE* *30, 2023:*
Stock based
compensation - - 91,531 - 91,531
Transactions
with related
party - - 12,167 - 12,167
Comprehensive
loss - - - (433,324 ) (433,324 )
*BALANCE AS OF JUNE
30, 2023* 3,597,442 21,456 13,091,990 (15,085,002 ) (1,971,556 )
*The accompanying notes are an integral part of these condensed interim financial statements.*
*
*
* CONDENSED INTERIM STATEMENTS OF CASH** FLOWS** (Unaudited)*
*U.S. dollars *
*Six months ended *
*June 30,* *2023* *2022*
*CASH FLOWS FROM OPERATING ACTIVITIES:*
Net loss (433,324 ) (948,376 )
Adjustments required to reconcile net loss to net cash used inoperating activities -
Depreciation 10,225 8,629
Stock based compensation expenses 47,991 67,424
Interest expenses with respect to funding from Parent Company 96,883 -
Currency exchange differences with respect to amount due to
the Former Parent Company - (243,948 )
Finance expenses (3,358 ) -
Changes in operating assets and liabilities items:
Decrease (increase) in trade receivables 165,660 (9,374 )
Decrease (increase) in other accounts receivable 72,489 (97,332 )
Increase in deferred prospective initial public offering cost (72,756 ) (147,973 )
Increase in inventory (37,466 ) (87,387 )
Decrease in right-of use asset 24,382 24,516
Increase in trade payables 51,520 28,186
Decrease in lease liabilities (21,024 ) (30,592 )
Increase (decrease) in other payables (150,406 ) 34,825
Net cash used in operating activities (249,184 ) (1,401,402 )
*CASH FLOWS FROM INVESTING ACTIVITIES:*
Purchase of property and equipment (677 ) (8,447 ) (677 ) (8,447 )
*CASH FLOWS FROM FINANCING ACTIVITIES:*
Loan from related party 245,000 -
Cost associated with the conversion of the Former Parent
Company's debt - (84,780 )
Loans from the Former Parent Company - 107,994
Proceeds from issuance of SAFEs - 1,514,928 245,000 1,538,142
*NET INCREASE (DECREASE) IN CASH * (4,861 ) 128,293
*CASH AT BEGINNING OF PERIOD* 89,806 33,024
*CASH AT END OF PERIOD* 84,945 161,317
*SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:*
Benefit to the Company by an equity holder with respect to funding transactions 12,167 -
Right-of use asset recognized against lease liability, net - 97,532
Conversion to equity of the Former Parent Company's debt - 6,508,089
Deferred prospective initial public offering cost 43,540 29,491