Kraken Robotics Inc · TSXV:PNG
Kraken Robotics — Investor Presentation (October 2018)
37 slides from Kraken Robotics's investor presentation, October 2018
Slide 1: World Leaders in Underwater Sensors & Robotics
World Leaders in Underwater Sensors & Robotics Kraken Robotics Inc. (TSX-V: PNG, OTCQB: KRKNF) October 2018
Slide 2: Forward Looking Statements
Forward Looking Statements Some statements herein contain forward-looking information. The use of any of the words "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "will," "plans," "project," "should," "target" and similar expressions are intended to identify forw
Slide 3: Sensors, Systems, Software, Services for the Digital Ocean
Sensors, Systems, Software, Services for the Digital Ocean Actionable Intelligence™ www.krakenrobotics.com 3
Slide 4: Corporate Structure
Corporate Structure Actionable Intelligence™ www.krakenrobotics.com 4
Slide 5: Reasons to Own Kraken Stock (TSX-V:PNG)
Reasons to Own Kraken Stock (TSX-V:PNG) Strong technology offering in industry with high barriers to entry and small number of competitors External validation points • Commercial market wins with GE Oil & Gas; Ocean Infinity (MH370 & Argentinian sub search) • Recent strategic equity investment by cu
Slide 6: Capital Structure
Capital Structure • Management and insiders own ~ 30% of outstanding shares • $35 million of subsea sensor and robotics intellectual property ($15M organic development; $20M creatively structured asset acquisitions and partnerships) Actionable Intelligence™ www.krakenrobotics.com 6
Slide 7: Ocean Infinity $2.8M Equity Investment – External Validation
Ocean Infinity $2.8M Equity Investment – External Validation ▪ WHO: New well funded entrant to ocean survey & exploration business ▪ WHY: They were looking to adopt the best technology to better automate the ocean survey data acquisition chain and accelerate industry disruption ▪ INVESTMENT: ▪ $2.3M
Slide 8: Corporate Overview
Corporate Overview ▪ Kraken Is A Leader in Maritime Robotics - 6 year old company with 50+ employees in Canada, USA, and Germany - Evolving from Sensors to Systems to Robotics as a Service (RaaS) ▪ Advanced Technology & Proven Products - Validated by leading navies & defense contractors; exported to
Slide 9: US$5B Maritime Robotics Market By 2020
US$5B Maritime Robotics Market By 2020 MILITARY COMMERCIAL Hydrography, Oil & Gas, Subsea IRM, Science and Emerging Sectors 40% 60% $2B $3B Mine Counter Cable & Pipeline Hydrography & Offshore Wind, Wave Measures Survey Seabed Mapping and Tidal Farms Intel, Surveillance and Subsea Infrastructure Sea
Slide 10: Military Applications
Military Applications • Mine Warfare 500,000 underwater mines • Anti-Submarine Warfare 400 operational submarines • Intelligence, Surveillance, Recon Special forces, covert operations, environmental assessment • Resurgence in underwater warfare and emergence of seabed warfare driving demand for unma
Slide 11: Offshore Energy Applications
Offshore Energy Applications ▪ >7,000 fixed platforms ▪ >200 floating platforms ▪ >4,000 subsea wells ▪ >650 offshore drilling rigs ▪ >200,000 km subsea pipelines ▪ >4,000 offshore wind turbines ▪ >600,000 subsea connectors • Maintenance of existing infrastructure is a major driver for underwater se
Slide 12: Business Strategy
Business Strategy ROBOTICS 2015 ▪ KATFISH ▪ A-LARS ROBOTICS 2017+ SENSORS 2012 ▪ THUNDERFISH “A” ▪ ACOUSTIC ▪ THUNDERFISH 6000 ▪ LASER ▪ OPTICAL RaaS 2018+ ▪ DATA ACQUISITION ▪ ARTIFICIAL INTELLIGENCE ▪ DATA ANALYTICS Actionable Intelligence™ www.krakenrobotics.com 12
Slide 13: Advanced Sensors & Robotics Portfolio
Advanced Sensors & Robotics Portfolio Actionable Intelligence™ www.krakenrobotics.com 13
Slide 14: Sensors - Synthetic Aperture Sonar (SAS)
Sensors - Synthetic Aperture Sonar (SAS) Some SAS Advantages ▪ KATFISH ▪ A-LARS Ultra High Image Resolution (15x Better) Increased Area Coverage Rate Conventional Operational Safety ▪ THUNDERFISH “A” ▪ ACOUSTIC ▪ THUNDERFISH 600 ▪ LASER ▪ OPTICAL Image courtesy ECA Robotics Kraken AquaPix® SAS Actio
Slide 15: Sensors - World 1st: Full Colour 3D Underwater Laser
Sensors - World 1st: Full Colour 3D Underwater Laser Actionable Intelligence™ www.krakenrobotics.com 15
Slide 16: SeaVision – Custom Solutions
SeaVision – Custom Solutions DFKI AWI Crawler Actionable Intelligence™ www.krakenrobotics.com 16
Slide 17: Evolving from Sensors to Systems and RaaS
Evolving from Sensors to Systems and RaaS ROBOTICS 2015+ ▪ KATFISH ▪ A-LARS ▪ THUNDERFISH “A” ▪ ACOUSTIC ▪ THUNDERFISH 600 ▪ LASER ▪ OPTICAL Actionable Intelligence™ www.krakenrobotics.com 17
Slide 18: KATFISH - Tethered Underwater Towfish
KATFISH - Tethered Underwater Towfish Commercial & Military Certified - Orders from Germany and Israel - Key component in major foreign navy bids - Recent surveys performed under CRADA with US Navy and NOAA - Successful demonstrations at ANTX 2018 in U.S Actionable Intelligence™ www.krakenrobotics.c
Slide 19: THUNDERFISH - Autonomous Underwater Vehicle
THUNDERFISH ® - Autonomous Underwater Vehicle Searching for Avro Arrow models in Lake Ontario Actionable Intelligence™ www.krakenrobotics.com 19
Slide 20: Tentacle Winch
Tentacle® Winch 2 Year R&D Effort from Kraken Handling Systems Group in Nova Scotia - Highly intelligent electric winch which can adjust cable scope through active feedback from underwater towed platform - Successful demonstrations at ANTX 2018 in U.S and during NOAA and NUWC CRADA’s Actionable Inte
Slide 21: Kraken Power – Batteries & Thrusters
Kraken Power – Batteries & Thrusters Ocean Infinity Battery Contract • $2.5M for delivery in Q4 2018; $6.5M for delivery in 2019 • LiPo batteries for integration on 6000M Hugin AUVs • Extends single mission time from 50+ hours (with current batteries) to 80+ hours with Kraken batteries Actionable In
Slide 22: Current R&D Developments
Current R&D Developments Multi-Spectral SAS JellyFish Hybrid AUV/ROV • Ultra-wideband • 6000M rated • Sub bottom target detection • Wind farm targeted with Kraken SeaVision • Designed for truly autonomous AUV sensor deployment • Commercial product 2020 • LF 3D down look buried cable detection & • Le
Slide 23: Anti-Submarine Warfare (ASW)
Anti-Submarine Warfare (ASW) • Acoustic Signal Processing Group established July 2018 in Toronto • Established 4 person team of senior engineers with 80+ year of experience in sonar system development and integration • Core competency in implementations of signal processing and user interface softwa
Slide 24: 2017 Strategic Milestones
2017 Strategic Milestones ✓ Established Kraken Robotik GmbH in Bremen, Germany ✓ Reached Exclusive Robotics IP Agreement with Fraunhofer Institute ✓ Established Kraken Power GmbH in Rostock, Germany ✓ OTCQB Stock listing in the U.S. ✓ Took delivery of AUV from Fraunhofer and renamed ThunderFish ✓ Fo
Slide 25: 2018 Strategic Milestones
2018 Strategic Milestones ✓ SAS sensor deployed on US Navy AUV ✓ Win European offshore energy technology competition with Carbon Trust ✓ Ocean Supercluster chosen as one of 5 cluster winners to share $950M in funding ✓ Strategic alliance with ThayerMahan ✓ Announced multi-spectral SAS with Ocean Inf
Slide 26: Historical Financials Reflect Development Mode
Historical Financials Reflect Development Mode • Historical financials represent various trial sales of SAS sensors to defense customers • Most of revenues prior to 2018 were for single unit AquaPix sales • Product gross margins 50% - 80% • ~$20+ orders in last 4 Quarters ▪ Q3/17: first multi unit S
Slide 27: 2017 Financial Milestones
2017 Financial Milestones 2017 ▪ $1.5M Grant from NRC and $0.75M Grant from RDC ▪ Completed Private Placement of $2.1M; sold Non-Core Asset Proceeds $0.9M ▪ $0.2M First contract for KRG for customized SeaVision for subsea crawler ▪ $0.4M Repeat Contract from European Defence Contractor (ECA Robotics
Slide 28: 2018 Financial Milestones
2018 Financial Milestones 2018 ▪ $0.4M Contract from US defense customer ▪ Completed Private Placement of $1.5M ▪ Pre-qualified for BCIP contracts for ThunderFish ($1M) and SeaVision ($0.5M) ▪ $0.9M Contract for Kraken Germany for SeaVision sensors & software ▪ Completed Private Placement of $2.3M w
Slide 29: Financial Snapshot & Customers
Financial Snapshot & Customers ▪ New products & partnerships will drive growth: ▪ Revenues to date mainly sensors with ASPs of $400K ▪ Forecast revenues in 2018 to at least $7 million ▪ Strong outlook for New Products: sensors (ASP $100k to $1M), KATFISH product (ASP of $2M commercial, $3M military
Slide 30: US$200+ Contract Pipeline
US$200+ Contract Pipeline ▪ Defense Industry: In the Midst of an Industry Upgrade Cycle for Mine Counter Measures (MCM) Tech ▪ Multiple Navy defense pursuits - across North America, Europe, and the Middle East for KATFISH and sensors. ▪ Key defense company partners - ThayerMahan (US), Atlas (Germany
Slide 31: Financial Scenario Analysis
Financial Scenario Analysis NOTE: TABLE BELOW IS NOT A FORECAST ▪ New products available in 2017/2018 drive growth ▪ System sales just starting ▪ Kraken Germany emerging ▪ RaaS revenue emerging ▪ Significant operating leverage in business model Actionable Intelligence™ www.krakenrobotics.com 31
Slide 32: Strong Upside Potential
Strong Upside Potential ▪ Market leading technology, products, team in an industry with high barriers to entry ▪ Kraken Organic Growth will be strong driven by new products, new partners, and industry upgrade cycles. ▪ Accelerating M&A in the sector: ▪ 2016 - General Dynamics acquired Bluefin Roboti
Slide 33: Contact Details
Contact Details Karl Kenny Sean Peasgood Chief Executive Officer Sophic Capital Kraken Robotics Inc. Investors Relations 709-757-5757 647- 955-1274 kkenny@krakenrobotics.com Sean@sophiccapital.com Greg Reid Chief Financial Officer Kraken Robotics Inc. 416-818-9822 greid@krakenrobotics.com © Copyrigh
Slide 34: Supplementary Slides
Supplementary Slides Actionable Intelligence™ www.krakenrobotics.com 34
Slide 35: Management & Technical Team Depth
Management & Technical Team Depth Karl Kenny, President & CEO • Ex-Canadian Navy maritime surface officer and Microsoft employee pre-public company • 20 year history in imaging technologies having founded 3 companies Greg Reid, Chief Financial Officer • 20+ years of finance, investment, and business
Slide 36: German Activities Bearing Fruit
German Activities Bearing Fruit ▪ Kraken Robotik GmbH (KRG) established in January and now staffed with 4 underwater robotics experts (ex DFKI) including 2 PHDs. ▪ DFKI (German Center for Artificial Intelligence Research) ▪ FlatFish AUV & precursor to SeaVision laser scanner ▪ Fraunhofer IOSB AUV pa
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