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ParaZero Announced First Half 2023 Financial Results

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:

"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

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 in
 operating 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 transactions12,167 -
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 cost43,540 29,491

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