Delta Drone International Limited has provided its business update for the quarter ending 30 September 2021 (Q3, 2021).
Commenting on the Company’s progress during the quarter, Delta Drone International (DLT) CEO Christopher Clark said:
“This quarter has seen our expansion strategy in Australia start to take form, with the acquisition of 60% of the shares in aerial and terrestrial surveying services provider, Arvista. We now have a highly skilled local team as part of Delta Drone International and I couldn’t be more pleased with the calibre of customers we are now working with in Australia. While it’s still early days, with Arvista only commencing trading as a DLT subsidiary as of 1 September, I look forward to closing out 2021 and entering 2022 with a fully operational and growing presence in Australia. Our international operations continue to flourish, again signing contracts with renowned enterprise companies, Barrick Gold (Holdings) Limited, Anglo American Platinum Limited subsidiary, Rustenberg Platinum Mines Limited, and Corteva Agriscience RSA (Pty) Ltd subsidiary, Pioneer Seed RSA. The faith our enterprise customers place in us to deliver the data they need, is a testament to our unique ‘drones-as-a-service’ model and the value it provides. We continue to expand our footprint in Africa, entering both Mali and Niger to examine mining site expansion options. In addition, our agriculture & renewable-energy specialist brand, RocketFarm, has delivered a completely tailored data solution for a concentrated solar power (CSP) plant survey, which saw the team successfully re-train the thermal AI detection formula which was previously used on Photovoltaic (PV) plants, to identify leaks and energy loss. I am also pleased to report that Delta Drone International has ranked fourth in the Drone Industry Insights (Droneii) Top Drone Service Providers for 2021 Report. This report ranks the top drone service providers in the world using company size, market share, and public attention as key parameters. To be ranked fourth in the world less than a year as a company shows our strategy to become the leading drone service provider, globally is delivering.”
COMMERCIAL UPDATE
Arvista Pty Ltd
In September 2021, DLT formally completed the acquisition of 60% of the shares in Perth-based provider of aerial and terrestrial surveying services, Arvista Pty Ltd, with the company commencing trading as a DLT subsidiary on 1 September 2021.
Anglo American Platinum Limited
During the period, DLT signed a contract for survey mapping, blast monitoring and inspection services with Rustenberg Platinum Mines Limited, a wholly owned subsidiary of Anglo American Platinum Limited, the world’s largest producer of platinum, at its Mogalakwena site in South Africa.
Corteva Agriscience RSA (Pty) Ltd
DLT secured a contract with major producer of seeds for agriculture, Corteva Agriscience RSA (Pty) Ltd adding to the Company’s growing multi-national customer base. The contract was signed after Delta Drone International successfully provided its leading drones-as-a-service capabilities across several ad-hoc agriculture projects for the conglomerate over the last two years.
Solar Inspection
DLT subsidiary, RocketFarm, has provided a concentrated solar power (CSP) plant survey for a customer in South Africa’s Northern Cape Province. The survey holds great significance in the industry as historically, this type of survey has been extremely challenging to conduct due to the reflective nature of the plant’s mirrors preventing the capture of images required.
OPERATIONAL UPDATE
Mali expansion
In July, DLT expanded its operations into Mali after being appointed by multinational gold mining company Barrick Gold for advanced light detection and ranging (LIDAR) services to examine mining site expansion options in the region. The operation delivered Barrick Gold the data required to guide decision making, while Barrick continued to focus on their day-to-day mining operations.
Niger expansion
DLT will enter the Niger market for the first time with uranium explorer and developer, GoviEx Uranium Inc, to perform a virtual 3D model baseline survey for its potential new Madaouela mine in the region.
The baseline survey will be one of the first times Delta Drone International uses its advanced surveying and data capture technology to create a shareable view of a potential mining site to share with GoviEx Uranium stakeholders who are unable to attend the site due to current travel restrictions, and for use by the engineering teams for project construction design.
OUTLOOK
“Delta Drone International is on its way to becoming the becoming the leading drones-as-a-service provider in Australia. The Australian expansion is supported by DLT’s highly successful operations overseas and the continued signing of big-name enterprise customers. We will continue to provide our industry leading services in the mining and agriculture sectors as we look to expand past these industries and into others, that can benefit from the range of ways we can capture data to enhance business operations”, said Mr Clark.
FINANCIAL OVERVIEW
Receipts from customers for Q3, 2021 totalled A$1.427 million, an increase of A$95k on the second quarter (Q2, 2021).
Total cash operating outflows during the quarter totalled A$2.242 million, an increase of A$177k on the second quarter mainly attributed to operating expenses of the newly acquired Arvista Pty Ltd.
Major expenses comprised:
- A$476K on product manufacturing and operating costs, an increase of A$135k on the second quarter;
- A$859K on staff costs, an increase of A$117k on the second quarter; and
- A$823K on administration and corporate costs.
Pursuant to ASX Listing Rule 4.7C.2, the Company provides the below table as a comparison of actual expenditure against the “use of funds” table as disclosed in the Prospectus dated 10 November 2020 (“Prospectus”) (ASX announcement of 10 November 2020):
Explanation of material variances in the use of funds:
- As highlighted in the June 2021 quarterly activity report, expansion of the South African operations commenced earlier than expected which has resulted a material variance in the budgeted expenditure.
- Includes a payment of A$300k to acquire 60% of the shares in Arvista Pty Ltd (as announced to the ASX on 16 August 2021 and 1 September 2021).
