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Ondas Holdings Inc. (ONDS) SEC Filing 10-K Annual report for the fiscal year ending Thursday, December 31, 2020

Ondas Holdings Inc.

CIK: 1646188 Ticker: ONDS

Exhibit 99.1

 

Ondas Holdings Reports Full Year 2020 Financial Results

 

Successfully drove early adoption of proprietary wireless connectivity solutions in rail and drone markets

 

Completed $34.5 million public offering and Nasdaq listing, providing financial foundation for growth

 

Nantucket, MA – March 8, 2021 - Ondas Holdings Inc. (NASDAQ: ONDS), a developer of proprietary, software-based wireless broadband technology for large established and emerging industrial markets (“Ondas” or the “Company”), today announced financial and operating results for the full year ended December 31, 2020.

 

Ondas made tremendous strides in 2020, successfully driving wider commercial adoption of its proprietary wireless connectivity solutions for industrial internet applications and Mission-Critical IoT (“MC-IoT”) in two of the Company’s core markets – commercial rail and unmanned aerial systems (UAS). In addition, with $31.3 million in net proceeds from its follow-on public offering in December, the Company substantially strengthened its balance sheet, ending the year better positioned to support its long-term growth initiatives and investments.

 

“2020 was truly a break-out year for Ondas, starting with the announcement of a significant strategic partnership with Siemens Mobility (‘Siemens’) to bring our game-changing wireless technology to the North American Rail Market,” said Eric Brock, Ondas’ Chairman and CEO. “We also delivered the initial phase to Aura Network Systems (‘Aura’) of a groundbreaking wide-area network intended to offer drone navigation capabilities to UAS operators. These key business development successes were capped off by a public offering and Nasdaq listing in December, which affords us the flexibility to continue executing our ambitious growth strategy and realize the full potential of Ondas’ transformative wireless broadband technology in large legacy and emerging infrastructure markets.”

 

Full Year 2020 & Recent Highlights

 

2020 revenues increased 575%, primarily driven by Ondas’ strategic partnership with Siemens in the North American Rail Market and the delivery of the first phase network for Aura, our nationwide US drone customer.

 

We are now completing, on schedule, the first major product development program with Siemens to combine Siemens’ ATCS protocols with Ondas’ MC-IoT technology in the greenfield 900 MHz licensed band.

 

Siemens is in the final stages of launching Airlink, a Siemens-branded version of Ondas’ MC-IoT technology for the North American Rail market. The initial focus of this product line will be the nationwide 900 MHz network, which the US Federal Communications Commission (FCC) awarded to Class 1 Rails operators in August 2020.

 

In February 2021, Ondas and Siemens began work on a new product for global Rail markets, the development of which is expected to be completed by the end of 2021.

 

Also, in February 2021, Ondas entered into a strategic partnership with Rogue Industries to advance the adoption of Ondas’ MC-IoT platform in US government and defense markets.

 

In March 2021, Aura ordered the next phase of the joint-development program with Ondas to begin commercialization of the previously mentioned UAS wireless navigation system.

 

 

 

 

Full Year 2020 Financial Highlights

 

Revenues for the year ended 2020 were $2.2 million, an increase of $1.8 million, or 575%, compared to 2019. The revenue increase was driven primarily by Ondas’ joint development program with Siemens in the North American Rail Market and the phase-one buildout of the UAS navigation network with strategic partner Aura.

 

Operating expenses decreased $3.2 million, or 20%, mainly due to expense reductions in payroll, travel and entertainment, and professional services.

 

As a result of increased revenue and lower operating expenses, the Company’s net loss decreased approximately $5.9 million to approximately $13.5 million for the year ended December 31, 2020, compared with approximately $19.4 million for the year ended December 31, 2019. Diluted net loss per share was ($0.66) for the year ended December 31, 2020, compared to ($1.10) per share for the year ended December 31, 2019.

 

Results of Operations   Year ended December 31,   Increase/ 
($ in 000s)  2020   2019   (Decrease) 
Revenue  $2,164   $320   $1,844 
Cost of sales   1,236    79    1,157 
Gross profit   928    241    687 
Operating expenses:               
General and administrative   7,642    4,793    2,849 
Sales and marketing   1,224    5,404    (4,180)
Research and development   3,586    5,416    (1,830)
Total operating expense   12,452    15,613    (3,161)
Operating loss   (11,524)   (15,372)   (3,848)
Other income (expense)   (1,954)   (4,018)   (1,817)
Net loss  $(13,478)  $(19,390)  $(5,912)

  

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The Company held cash and cash equivalents of $26.1 million on December 31, 2020, an increase of $23.8 million from 2019. The increase in cash and cash equivalents was primarily the result of $31.2 million in net proceeds from Ondas’ public equity offering in December 2020, offset by operating losses during the fiscal year. Cash used in operating activities was $7.5 million in 2020, compared to $14.7 million in 2019.

 

Summary of Sources and (Uses) of Cash  Year ended December 31, 
($ in 000s)  2020   2019 
Net cash used in operating activities  $(7,534)  $(14,664)
Net cash used in investing activities   (16)   (355)
Net cash provided by financing activities   31,458    16,042 
Increase in cash   23,908    1,023 
Cash and cash equivalents, beginning of year   2,153    1,130 
Cash and cash equivalents, end of year  $26,061   $2,153 

 

Outlook

 

Ongoing investments in market expansion and deeper penetration of select verticals are expected to continue supporting bookings and revenue growth in 2021, as Ondas advances its long-term strategy to drive commercial adoption of its proprietary technology across multiple markets. The Company continues working closely with Class 1 Rails and strategic rail partner Siemens to advance the adoption of Ondas’ FullMAX platform in the 900 MHz network, greenfield spectrum. Currently, the Company anticipates that initial commercial bookings from the Rails will commence in the second half of 2021.

 

In addition, commercialization efforts with Aura, the Company’s drone partner, remain on track, with the expectation of at least two revenue-producing product development agreements in the first half of 2021, as well as initial equipment orders for UAS customers and ecosystem partners for testing and network expansion during the year.

 

Ondas intends to continue pursuing additional bookings and deployments of its proprietary technology in security and other addressable markets, throughout 2021.

 

For the first quarter of 2021 the Company expects bookings of at least $2.0 million and revenue between $1.0 and $1.5 million. Operating expenses are expected to be between $2.5 and $3.0 million on a cash basis in the first quarter and may trend up modestly over the course of 2021. Cash operating expenses exclude non-cash expenses such as stock-based compensation.

 

Earnings Conference Call & Audio Webcast Details

 

An earnings conference call is scheduled for today, March 8, 2021, at 8:30 a.m. ET. Investors may access a live webcast of the earnings conference call via the “News / Events” page of the Company’s Investor Relations website at https://ir.ondas.com. Following the presentation, a replay of the webcast will be available for 30 days in the same location of the Company’s website.

 

Live Listen Only Webcast https://ir.ondas.com
   
Participant Dial In (toll free) 1-866-777-2509
   
Participant Dial In (International) 1-412-317-5413
   
Participant Call Pre-Registration (encouraged) https://dpregister.com/sreg/10152922/e3b695712a

 

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About Ondas Holdings Inc.

 

Ondas Holdings Inc., through its wholly owned subsidiary, Ondas Networks Inc., is a developer of proprietary, software-based wireless broadband technology for large established and emerging industrial markets. The Company’s standards-based, multi-patented, software-defined radio FullMAX platform enables Mission-Critical IoT (MC-IoT) applications by overcoming the bandwidth limitations of today’s legacy private licensed wireless networks. Ondas Networks’ customer end markets include railroads, utilities, oil and gas, transportation, aviation (including drone operators) and government entities whose demands span a wide range of mission critical applications. These markets require reliable, secure broadband communications over large and diverse geographical areas, many of which are within challenging radio frequency environments. Customers use the Company’s FullMAX technology to deploy their own private licensed broadband wireless networks. The Company also offers mission-critical entities the option of a managed network service. Ondas Networks’ FullMAX technology supports IEEE 802.16s, the new worldwide standard for private licensed wide area industrial networks. For additional information, visit www.ondas.com or follow Ondas Networks on Twitter and LinkedIn.

 

Forward Looking Statements

 

Statements made in this release that are not statements of historical or current facts are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. We caution readers that forward-looking statements are predictions based on our current expectations about future events.

 

These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions that are difficult to predict. Our actual results, performance, or achievements could differ materially from those expressed or implied by the forward-looking statements as a result of a number of factors, including, the risks discussed under the heading “Risk Factors” in our most recent Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (“SEC”), in our Quarterly Reports on Form 10-Q filed with the SEC, and in our other filings with the SEC. We undertake no obligation to publicly update or revise any forward- looking statements, whether as a result of new information, future events or otherwise that occur after that date, except as required by law.

 

# # #

 

Contacts

 

Investors:

Stewart Kantor, CFO

Ondas Holdings Inc.

888.350.9994 Ext. 1009

ir@ondas.com

 

Media:

Jeffrey Mathews or Dan Gagnier

Gagnier Communications

646.569.5711

ondas@gagnierfc.com

 

 

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The following information was filed by Ondas Holdings Inc. (ONDS) on Monday, March 8, 2021 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Document And Entity Information
Consolidated Balance Sheets
Consolidated Balance Sheets (Parentheticals)
Consolidated Statements Of Cash Flows
Consolidated Statements Of Operations
Consolidated Statements Of Stockholders' Equity (Deficit)
Accounting Policies, By Policy (Policies)
Accrued Expenses And Other Current Liabilities
Accrued Expenses And Other Current Liabilities (Details) - Schedule Of Accrued Expenses And Other Current Liabilities
Accrued Expenses And Other Current Liabilities (Tables)
Commitments And Contingencies
Commitments And Contingencies (Details)
Description Of Business And Basis Of Presentation
Description Of Business And Basis Of Presentation (Details)
Income Taxes
Income Taxes (Details)
Income Taxes (Details) - Schedule Of Deferred Tax Assets And Liabilities
Income Taxes (Details) - Schedule Of Effective Income Tax Rate Reconciliation
Income Taxes (Details) - Summary Of Valuation Allowance
Income Taxes (Tables)
Intangible Assets
Intangible Assets (Details)
Intangible Assets (Details) - Schedule Of Estimated Amortization Expense
Intangible Assets (Tables)
Notes Payable And Other Financing Agreements
Notes Payable And Other Financing Agreements (Details)
Notes Payable And Other Financing Agreements (Details) - Schedule Of Future Maturities Of The Loan Payable
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Other Current Assets
Other Current Assets (Details) - Schedule Of Other Current Assets
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Property And Equipment
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Related Party Transactions
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Secured Promissory Notes
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Stockholders??? Equity
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Stockholders??? Equity (Details) - Schedule Of Assumptions Used In Black-Scholes Model
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Summary Of Significant Account Policies
Summary Of Significant Account Policies (Details)
Summary Of Significant Account Policies (Details) - Schedule Of Changes In Fair Value Associated With Level 3 Liabilities
Summary Of Significant Account Policies (Details) - Schedule Of Concentration Of Customers
Summary Of Significant Account Policies (Details) - Schedule Of Deferred Warranty Activity
Summary Of Significant Account Policies (Details) - Schedule Of Disaggregation Of Revenue
Summary Of Significant Account Policies (Details) - Schedule Of Future Minimum Lease Payments
Summary Of Significant Account Policies (Details) - Schedule Of Inventory
Summary Of Significant Account Policies (Details) - Schedule Of Lease Costs
Summary Of Significant Account Policies (Details) - Schedule Of Net Loss Per Share
Summary Of Significant Account Policies (Details) - Schedule Of Other Information
Summary Of Significant Account Policies (Details) - Schedule Of Rou Lease Assets And Lease Liabilities
Summary Of Significant Account Policies (Tables)
Ticker: ONDS
CIK: 1646188
Form Type: 10-K Annual Report
Accession Number: 0001213900-21-013984
Submitted to the SEC: Mon Mar 08 2021 4:00:50 PM EST
Accepted by the SEC: Mon Mar 08 2021
Period: Thursday, December 31, 2020
Industry: Miscellaneous Amusement And Recreation

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