With instability and unrest mounting in the world, global defense spending potentially is on the rise. As noted by Defense News, according to an annual report by the Stockholm International Peace Research Institute (SIPRI), defense spending shot to a 10-year high of $1.917 trillion in 2019. The U.S. spent $732 billion that year- good for around 38% of that figure. Compared to the U.S., China spent $261 billion, India spent $71.1 billion, and Russia spent up to $65.1 billion. In addition, according to analysts at Deloitte, global defense spending could grow nearly 3% in New Year 2021. All as countries build their military capabilities in response to geopolitical pressure and the pandemic. “In 2021, defense budgets and revenues for defense contractors are expected to remain largely stable, as military programs continue to be critical to national defense, especially when geopolitical tensions are considered,” Deloitte added. From here, with military spending likely to increase even more in the future, some of the top companies to watch include KWESST Micro Systems Inc. (TSXV:KWE)(OTC:KWEMF), Ammo Inc. (NASDAQ:POWW), Byrna Technologies Inc. (CSE:BYRN)(OTC:BYRN), Wrap Technologies Inc. (NASDAQ:WRAP), and Patriot One Technologies Inc. (TSX:PAT)(OTC:PTOTF).
KWESST Micro Systems Inc. (TSXV:KWE)(OTC:KWEMF) BREAKING NEWS: KWESST Micro Systems Inc. announced a follow-on order for approximately C$ 1.1 million with a key U.S. military customer to expand use of the Company’s TASCS IFM system in military exercises, a key precursor to wider adoption.
The contract is for application of the TASCS IFM system on the 81mm mortar platform, which transforms it into a “smart” weapon system with greater accuracy and faster response time, improving soldier survivability and operational effectiveness. Work under the order is scheduled to commence immediately.
KWESST Founder, President and CEO Jeff MacLeod commented that, “This marks another key validating milestone in a market where TASCS IFM on the 81mm mortar alone could ultimately be worth up to C$120 million in the U.S. and another $C400 million worldwide, given the large installed base of 81mm mortars in service with so many NATO and allied military forces.”
KWESST previously announced the completion of an earlier two-phase initial contract with the same customer that marked the introduction of TASCS IFM on 81mm mortars in military exercises. “It is very encouraging to see the accelerated pace at which this important customer is expanding the use of TASCS IFM in its field exercises, and their confidence in KWESST, ” added MacLeod. “It is an honor to be working with them to enhance soldier survivability and effectiveness, which is our core mission.”
As previously announced, the TASCS IFM system has attracted interest from other NATO forces who have requested proposals from KWESST, which the Company is currently actioning. “The fact that the TASCS IFM confers so many modernization advantages without any modification to weapon platforms or munitions is a huge attraction,” said MacLeod.
He added that, “The 81mm mortar is just one of many different weapon platforms that can be transformed into a smart system with TASCS IFM, providing soldiers on the ground with real-time networked situational awareness and precision targeting information”. Accordingly, KWESST is pursuing additional global markets for the TASCS IFM, which can also work on platforms such as: 60mm mortars; grenade launchers; sniper rifles; drones; electronic decoys; and more, with a total addressable market of more than $C1 billion.
Other related developments from around the markets include:
Ammo Inc. (NASDAQ:POWW), a premier American ammunition and munition components manufacturer and technology leader, is providing a corporate update amidst unprecedented demand in the U.S. domestic and International commercial ammunition markets. AMMO has a current record backlog of $135 million in booked orders as of December 1, 2020—the largest in Company history. “Our record backlog has continued to grow, with booked orders coming in across all channels,” said Fred Wagenhals, AMMO’s CEO. “We continue to expand our footprint with retailers across the country while continuing to build brand awareness and loyalty with customers.”
Byrna Technologies Inc. (CSE:BYRN)(OTC:BYRN) reported record sales for the fiscal fourth quarter ended November 30, 2020 of approximately $11.1 million, up from $4.2 million in the third quarter (a 265% increase quarter over quarter). Domestic sales accounted for 91.2% of Byrna's fourth quarter sales with International Sales accounting for 8.8%. In terms of sales channels, 85.2% of Byrna's fourth quarter sales were generated through Byrna's e-commerce website, 10.9% of fiscal fourth quarter sales were through Byrna's brick & mortar dealers and 3.9% of Q4 revenues came from sales to Law Enforcement. This brought Byrna's 2020 full fiscal year sales to $16.7 million, an 1,800% increase from Byrna's 2019 fiscal full year sales of $924,000.
Wrap Technologies Inc. (NASDAQ:WRAP), an innovator of modern policing solutions, announced that it bid and was selected by the United Kingdom Ministry of Defence into their Defence and Security Accelerator (DASA) for ‘Advancing Less Lethal Weapons.’ The Defence and Security Accelerator (DASA) finds and funds exploitable innovation to support UK defence and security. DASA sought proposals for innovative technologies that allow law enforcement officers to safely prevent the escalation of conflict from long ranges during serious or violent circumstances. In the first phase of the program, WRAP’s engineering team will focus on developing proof of concept prototypes of longer-range remote restraint solutions.
Patriot One Technologies Inc. (TSX:PAT)(OTC:PTOTF), developer of the PATSCAN Multi-Sensor Threat Detection Platform, is pleased to announce the appointment of the Company’s new Chief Executive Officer Peter Evans to its Board of Directors, effective immediately following the quarterly board and committee meetings on Thursday, December 10, 2020. Revenue was $0.4 million for the three months ended October 31, 2020 as compared to $0.1 million for the same period ended October 31, 2019. The Company had $0.3 million of deferred revenue and $0.9 million of contracted revenue not yet recognized as revenue as of October 31, 2020, of which 100% is expected to be recognized over the next twelve months. Net loss decreased from $7.3 million in the first quarter ended October 31, 2019 to $3.3 million in the first quarter ended October 31, 2020. The decrease in loss pertains to streamlining of the Company’s business operations, CV relief funding received and transaction costs incurred for the acquisition of Xtract in the comparative period.
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