ZenaTech (ZENA) Registration Filing summary

Company overview and business model

• Operates as an enterprise software technology company specializing in mission-critical cloud-based applications and smart hardware for diverse industries, with a growing focus on drone manufacturing, sales, and distribution.

• Revenue streams include software licensing, SaaS subscriptions, support, and pilot drone programs, with expansion plans into agriculture, infrastructure, mining, and public safety sectors.

• The company has a global presence with subsidiaries in the US, Canada, Germany, Ireland, and the UAE, and leverages a management services agreement with Epazz for development and operations.

• Core products include EHR, SCADA, video surveillance, contact center, safety/compliance, field service, and law enforcement software, as well as proprietary drone technology.

• Growth strategy includes organic development and acquisitions of revenue-generating software companies, with a focus on integrating software and hardware solutions.

Financial performance and metrics

• For the three months ended March 31, 2024: revenue was $591,379, net loss was $120,924, and total assets were $18.2 million.

• For the year ended December 31, 2023: revenue was $1.83 million, net loss was $241,504, and total assets were $16.5 million.

• Revenue decreased 40% in 2023 compared to 2022, primarily due to reduced sales in certain segments and a focus on drone development.

• General and administrative expenses decreased by 33% in 2023, reflecting cost controls and reduced programming/support fees.

• As of March 31, 2024, working capital was $2.02 million, with $8.9 million in long-term debt and $8.05 million in shareholders' equity.

Use of proceeds and capital allocation

• The company will not receive proceeds from the resale of shares by registered stockholders in the direct listing.

• Recent capital raised ($3 million in July 2024) is allocated to working capital and general corporate purposes.

• Principal capital expenditures are focused on drone business development, including manufacturing facilities and product development, particularly in the UAE.

• Ongoing investments in R&D and acquisitions are funded through a mix of internal cash flow, private placements, and related-party credit lines.