EPS of $-0.03 increased by 94.9% from previous year
Net income of -461.24K
"N/A" - N/A
Defense Technologies International Corp (DTII) QQ1 2025 Results Analysis – Severe Liquidity Constraints, Material Losses, and Limited Revenue Visibility in the Passive Security Scanning Market
Executive Summary
DTII reported a subdued QQ1 2025 performance with meaningful profitability deterioration and acute liquidity stress. The company posted an operating loss of approximately $163.5k and a net loss of about $461.2k for the quarter, with earnings per share of roughly -$0.0513 (GAAP) and diluted EPS of -$0.0256. Revenue for the period is not disclosed in the provided data, limiting top-line assessment, but the quarter’s cash flow and balance sheet signal substantial cash burn and leverage risk.
The balance sheet is constrained: total assets of $8,106 versus total liabilities of $2.13 million, resulting in negative stockholders’ equity of about -$1.80 million. Cash and cash equivalents stood at $507, with near-term liquidity strained by a minuscule cash balance relative to roughly $2.13 million in current liabilities and a short-term debt burden of $498,874. Operational cash flow was negative at about -$39.4k, and free cash flow mirrors this burn. The company also carries sizable non-cash charges (notably a depreciation/amortization impact of -$296,834 in the quarter) which weigh on reported EBITDA and operating metrics.
From a relative-valuation and operating-efficiency standpoint, the QQ1 2025 results reflect a high-risk profile typical of a micro-cap with limited revenue visibility and a capital-structure that relies on ongoing financing to sustain operations. Management commentary (where available) is not included in the provided data, so the assessment focuses on the reported numbers and the balance-sheet/flow dynamics. Investors should monitor liquidity remediation progress, any disclosed revenue contracts or backlog development, and potential equity or debt financing outcomes before re-rating the stock.
Revenue: Not disclosed for QQ1 2025 (data not provided)
Gross Profit / Gross Margin: Not disclosed
Financial Highlights
Overview of key QQ1 2025 metrics (USD, unless stated):
- Operating Income: -$163,517; QoQ change +9.66%, YoY change -15.66%
- Net Income: -$461,239; QoQ change -252.09%, YoY change -261.83%
- EPS: -$0.05130; Diluted EPS: -$0.02560; QoQ EPS change -280%, YoY change +94.87%
- Revenue: Not disclosed for QQ1 2025 (data not provided)
- Gross Profit / Gross Margin: Not disclosed
- EBITDA: -$460,351; large net non-cash charges reflected in D&A (reported as -$296,834 for QQ1 2025)
- Operating Cash Flow: -$39,391; Free Cash Flow: -$39,391
- Cash and Cash Equivalents: $507 at period end
- Total Assets: $8,106; Total Liabilities: $2,132,877; Shareholders’ Equity: -$1,803,555
- Short-Term Debt: $498,874; Accounts Payables: $299,470; Deferred Revenue: $40,375; Other Current Liabilities: $1,294,158
- Current Ratio: 0.0038; Quick Ratio: 0.00024; Cash Ratio: 0.00024
- Weighted Avg Shares Out: 8,990,000; Weighted Avg Shares Out Diluted: 17,986,515
- Net Debt: $498,367 (debt position shown as $498,874)
Income Statement
Metric
Value
YoY Change
QoQ Change
Operating Income
-163.52K
-15.66%
9.66%
Net Income
-461.24K
-261.83%
-252.09%
EPS
-0.05
94.87%
-280.00%
Key Financial Ratios
currentRatio
0
returnOnAssets
-5690%
returnOnEquity
25.6%
debtEquityRatio
-0.28
operatingCashFlowPerShare
$-0
freeCashFlowPerShare
$-0
priceToBookRatio
-0.3
priceEarningsRatio
-0.29
Net Income vs. Revenue
Expense Breakdown
Management Commentary
Transcript data is not provided in the dataset. Consequently, there are no management quotes or call themes to extract. The analysis therefore relies on the QQ1 2025 financials and the implied narrative from the balance sheet and cash flow data. If an earnings call transcript is supplied, the highlights would be organized by themes (strategy, operations, market conditions) with context and significance for investors.
N/A
— N/A
N/A
— N/A
Forward Guidance
Management guidance for DTII QQ1 2025 is not included in the provided data. In the absence of explicit forward guidance, the outlook must be inferred from the liquidity profile and profitability trajectory:
- Key uncertainty centers on the company’s ability to secure timely financing and/or generate meaningful revenue that could normalize cash flows and reduce per-share losses.
- Industry context for passive security scanning suggests potential demand from schools and public venues, but no backlog, contracts, or order flow data are disclosed in QQ1 2025.
- The achievability of any stated targets (if disclosed elsewhere) would hinge on stabilizing liquidity (reducing cash burn), scaling revenue, and improving gross/margin discipline. Investors should monitor: (i) any new financing arrangements (debt or equity), (ii) any disclosed contract wins or customer deployments, (iii) working-capital improvements, and (iv) any material changes to product mix or pricing that could improve profitability. In the interim, the risk/reward is skewed toward high risk given the negative equity and negative operating cash flow.
- Key factors to watch: liquidity runway, covenant conditions, ability to convert or refinance existing debt, and any off-balance-sheet arrangements.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
DTII Focus
0.00%
0.00%
25.60%
-29.20%
BCO
25.00%
9.78%
12.40%
20.71%
MSA
47.30%
20.70%
5.84%
32.31%
REZI
26.30%
9.08%
1.55%
19.03%
ALLE
43.80%
19.30%
9.16%
23.41%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
DTII presents a highly speculative investment profile driven by a distressed balance sheet, negative equity, and limited liquidity. The QQ1 2025 results show meaningful losses and negative operating cash flow, with top-line clarity missing due to undisclosed revenue. The company’s ability to sustain operations in the near term depends on securing favorable financing arrangements and translating any potential product deployments or pilots into measurable revenue and cash flow improvements.
Valuation and risk assessment favor cautious, selective exposure or wait-for-turnaround signals. Key catalysts would include: (i) disclosed revenue contracts, backlog, or pilots that validate demand for passive scanning technology; (ii) a credible plan to restore liquidity (e.g., debt refinancing, equity infusion, asset sales); and (iii) evidence of margin improvement or cost discipline that translates into positive operating leverage.
In summary, DTII is a high-risk, speculative opportunity with potential upside only if a credible liquidity runway is established and a revenue recovery plan materializes. Until such indicators emerge, the favorable course is to monitor for clarity on revenue generation, liquidity stabilization, and tangible operational improvements before committing capital.
Key Investment Factors
Growth Potential
Growth potential hinges on DTII monetizing its passive security scanning technology in high-traffic public venues (e.g., schools, government facilities) and securing recurring services or unit deployments. Any contract wins or partnerships could meaningfully alter the top-line trajectory if they translate into measurable revenue and backlog; however, no revenue visibility is provided in QQ1 2025.
Profitability Risk
Large liquidity and solvency risks: minimal cash ($507) against current liabilities (> $2.13 million) and short-term debt (~$499k). Negative stockholders’ equity (~$-1.80 million) raises default/recapitalization risk. Absence of disclosed revenue and heavy non-cash charges (D&A of -$296,834 in QQ1 2025) imply limited profitability upside without material revenue growth or cost optimization. Dependence on external financing to operate increases sensitivity to capital markets conditions and equity dilution for existing holders.
Financial Position
Balance sheet is severely distressed: total assets of 8,106 vs liabilities of 2,132,877; negative equity of -1,803,555. Very low liquidity metrics (current ratio 0.0038, quick ratio 0.00024, cash ratio 0.00024) and negative operating cash flow signal fundamental funding risk. Debt load appears manageable in magnitude but is insufficient to support ongoing operations without revenue generation or significant financing.
Overall, the investment thesis is highly speculative and contingent on a meaningful liquidity event and a credible revenue recovery plan.
SWOT Analysis
Strengths
Niche passive security scanning technology positioning DTII in the security protection services space.
Long-standing market experience through Passive Security Scan Inc., potential for future deployments in schools and public venues.
Weaknesses
Severe liquidity constraints with cash of $507 and current liabilities of $2,132,877.
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