AlphaValue Corporate Services Fundamental Analysis FR
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AlphaValue Corporate Services
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Drone Volt

CR
Bloomberg   ALDRV FP
Aerosp. & Defence Equipt.  /  France  Web Site   |   Investors Relation
Contract execution for a potentially record year
Target
Upside 107%
Price (€) 0.09
Market Cap (€M) 23.6
Debt

At the end of 2019, the company’s net debt amounted to just over €5m, compared to €2.5m a year earlier and a net cash position of €276,000 in 2017. Over the period 2017 to 2019, net gearing went from -4% to 58%. This increase in debt was mainly created by the acquisition of Aerialtronics in 2017, as well as the financing of the restructuring of this entity, which we estimate to be close to €4m at the end of 2019.

To finance itself, as well as its acquisition, Drone Volt has mainly used a funding line through the issue of bonds convertible into shares with share subscription warrants (OCABSA and ORNANE) between 2016 and 2019. At the end of 2019, and in order to limit shareholders’ dilution from convertible bonds, the company has diversified its funding sources through the issuance of a €1.7m bond, carrying a 12% coupon.

In 2020, Drone Volt continued to diversify its funding sources (by obtaining a €500,000 state-guaranteed loan) and strengthened its capital through three capital increases for a total of c. €3.7m (of which €411,000 in March and €2.16m in May to refinance 90% of the ORNANE issued in 2019 and €1.1m in June). In addition, Drone Volt secured two new financings for a total of €20.4m, of which a €10m financing in August 2020 through an equity line contract (€1.6m drawn down) as well as a €10.2m OCABSA (fully undrawn) with ATLAS in September 2020.

Funding - Liquidity
  12/20A 12/21E 12/22E 12/23E
EBITDA €th -2,065 -524 1,016 4,063
Funds from operations (FFO) €th -1,322 -348 924 3,217
Ordinary shareholders' equity €th 17,640 29,605 29,199 31,072
Gross debt €th 6,846 3,546 5,546 6,046
   o/w Less than 1 year - Gross debt €th 200 400 400 400
   o/w 1 to 5 year - Gross debt €th 6,646 3,146 5,146 5,646
 + Gross Cash €th 8,757 17,037 18,944 22,015
 = Net debt / (cash) €th -1,911 -13,491 -13,398 -15,969
Bank borrowings €th 1,352 541 703 844
Issued bonds €th 2,941 2,000 2,500 3,000
Financial leases liabilities €th 436 0.00 0.00 0.00
Other financing €th 2,117 1,005 2,343 2,202
Gearing (at book value) % 8.95 -26.0 -46.0 -47.3
Equity/Total asset (%) % 88.3 142 139 149
Adj. Net debt/EBITDA(R) x 0.93 25.8 -13.2 -3.93
Adjusted Gross Debt/EBITDA(R) x -3.43 -7.31 5.78 1.58
Adj. gross debt/(Adj. gross debt+Equity) % 28.7 11.4 16.7 17.1
Ebit cover x -6.22 -10.5 -3.91 7.65
FFO/Gross Debt % -18.6 -9.09 15.7 50.1
FFO/Net debt % 69.2 2.58 -6.90 -20.1
FCF/Adj. gross debt (%) % -23.2 -54.8 -18.6 24.5
(Gross cash+ "cash" FCF+undrawn)/ST debt x 35.6 37.3 44.6 59.0
"Cash" FCF/ST debt x -7.24 -5.24 -2.73 3.93
Credit Risk
Covenants
Changes to Story : 08/12/2021, Changes to Forecasts : 08/12/2021.