The DroneShield Ltd (ASX: DRO) share price has surged 25% today after the company announced a contract with the United States Air Force.
DroneShield awarded US Air Force contract
Earlier today, DroneShield released an announcement informing the market the company has been awarded a contract with the United States Air Force worth approximately US$200,000. Under the contract, DroneShield will supply multiple units of its ‘DroneSentry’ integrated detect-and-defeat systems to the Grand Forks Air Force base in North Dakota, US. According to the company, its DroneSentry technology was chosen because of its artificial intelligence software and tracking/defeat automation.
The contract marks DroneShield’s first US Air Force deployment and allows for additional units to be ordered after the original contract is fulfilled. DroneShield’s management expressed the strategic significance of the contract that will provide the company with the opportunity to expand its solutions in the key market.
How has the DroneShield share price performed?
DroneShield is an Australian based company that specialises in drone security technology. The company’s security solutions are designed to protect people and critical infrastructure from intrusions by drones. DroneShield built its hardware and software from the ground up and has an extensive pipeline of solutions. The announcement of DroneShield’s contract with the US Air Force follows the company’s quarterly report which was released yesterday.
DroneShield provided an update on its activities for the fourth quarter of FY20. This was highlighted by the company finishing the quarter cashflow-positive, with cash inflows of $2.1 million. As a result, the company recorded its first ever quarter in which operating cashflows were approximately breakeven.
DroneShield highlighted a substantial increase in US government business, with the company also working towards a formal contract in the Middle-East. DroneShield also noted the impact of COVID-19 on its operations, with the pandemic interrupting the company’s operations and logistics.
At the time of writing, investors have driven the DroneShield share price 25% higher for the day, with the company’s shares currently trading at 15 cents.
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Motley Fool contributor Nikhil Gangaram has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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