LONDON (Alliance News) - Drone maker Strat Aero PLC on Friday said its pretax loss widened in the first half as a sharp rise in costs offset a similarly big jump in revenue, and the company said it will need to raise money in the fourth quarter.
Chairman Graham Peck said Strat Aero expects to need additional funding in the fourth quarter of 2016 to provide the working capital necessary to support its growth, but he said it remains confident of its strategy.
Strat Aero said it will focus its energies on the commercial drone training market and on survey and inspection services and noted it had made good progress in both units in the first half.
Shares in Strat Aero were down 15% to 0.63 pence on Friday.
Strat Aero said it made a USD2.1 million loss in the first half of 2016, compared with a USD1.3 million loss a year prior. Revenue rose to USD410,740 from just USD57,441, but the ramp-up of the company's operations made its administrative costs nearly doubled to USD2.4 million from USD1.3 million.
The firm said revenue from inspection, survey and consultancy services was below its expectations in the first half due to slower-than-expected take-up of drone technology by large customers. The pipeline for Geocurve, Strat Aero's aerial inspection unit, remains in line with expectations but the focus for the unit will be on improving billed revenue and reaching operating profitability.
Since the close of the half, Geocurve won a contract with the UK's Environment Agency's tidal flood defence projects in the Thames Estuary and secured a second US wind turbine inspection contract in August.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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