Record Quarterly Revenue; $9.5 Million in New Bookings; Outlook Remains Strong
TORONTO, June 06, 2024 (GLOBE NEWSWIRE) — Xtract One Technologies Inc. (TSX: XTRA) (OTCQX: XTRAF) (FRA: 0PL) (“Xtract One” or the “Company”) a leading technology-driven threat detection and security solution that prioritizes the patron access experience by leveraging AI, today announced fiscal third quarter results for the three and nine months ended April 30, 2024. All information is in Canadian dollars unless otherwise indicated.
Third Quarter Financial Highlights
Record revenue of $4.7 million for the three months ended April 30, 2024 versus $0.9 million in the prior-year period.
Gross margin for the Platform operating segment of 60% for the third quarter unchanged from the same period last year.
Announced new customer wins during the quarter including Co-op Live in Manchester and the American Bank Center.
Awarded the U.S. Department of Homeland Security (“DHS”) SAFETY Act Designation as a Qualified Anti-Terrorism Technology (“QATT”), enabling the Company to sell to organizations such as the National Hockey League (“NHL”) and Major League Baseball (“MLB”), among others.
Total contract value of new bookings1 was $9.5 million for the three months ending April 30, 2024 as compared to $5.6 million for the same period last year.
Platform contractual backlog was $13.8 million as of April 30, 2024 as compared to $3.1 million in the prior-year period, excluding an additional $12.8 million of agreements pending installation1 versus approximately $7.9 million last year.
Completed a public equity offering and concurrent private placement with Madison Square Garden Sports Corp. (“MSG Sports”) that raised gross proceeds, including an over-allotment option which closed subsequent to quarter end, of approximately $9.8 million; proceeds will be used to support the Company’s continued growth.
Subsequent to the period, announced contracts had been awarded with teams representing the NHL, MLB and National Basketball Association since the DHS SAFETY Act Designation as a QATT.
“This was a very busy three months, with revenue rising to a record $4.7 million as we onboarded numerous new customers during the quarter,” stated Peter Evans, Chief Executive Officer of Xtract One. “At the same time, our backlog of sales commitments climbed to $26.6 million – reflecting new clients and overall strong demand – with top line growth expected to accelerate due to our recent DHS Designation award. With the recent successful offering that raised gross proceeds of $9.8 million, including participation from MSG Sports, we are well positioned to continue to ramp up operations on our path to profitability. I’m very excited by the current high level of interest in our systems from the markets we’re pursuing and believe that the best is yet to come.”
Financial Results for the Three Month Period Ended April 30, 2024
Consolidated revenue was $4.7 million for the three months ended April 30, 2024 as compared to $0.9 million for the same period in fiscal 2023. Revenue from the Platform operating segment was $4.6 million for the fiscal 2024 third quarter versus $0.8 million in the prior-year period, reflecting new business contract wins and a greater number of installations. Revenue for the Xtract operating segment was approximately $0.1 million for the third quarter in both fiscal years.
Loss and comprehensive loss was $2.7 million for the three month period ended April 30, 2024 as compared to $3.8 million for the same period in fiscal 2023. The decrease reflects higher Platform revenue and a corresponding increase in gross profit, while total operating expenses rose only $1.1 million year-over-year, primarily reflecting higher research and development efforts.
This press release should be read in conjunction with the Company’s Unaudited Condensed Consolidated Interim Financial Statements, prepared in accordance with International Financial Reporting Standards (“IFRS”) and the Company’s Management’s Discussion and Analysis for the three and nine month periods ended April 30, 2024 and 2023, which can be found under the Company’s profile on SEDAR+ at www.sedarplus.ca.
Conference Call Details
Xtract One will host a conference call to discuss its results on Friday, June 7, 2023, at 10:00 am EST. Peter Evans, Xtract One CEO and Director, and Karen Hersh, CFO and Corporate Secretary, will provide an overview of the interim financial results along with management’s outlook for the business, followed by a question-and-answer period.
The webcast and presentation will be accessible on the company’s website. The webcast can be accessed here and the telephone number for the conference call is 844-481-3016 (412-317-1881 for international callers).
About Xtract One Technologies
Xtract One Technologies is a leading technology-driven threat detection and security solution leveraging AI to provide seamless and secure patron access control experiences. The Company makes unobtrusive threat detection systems that enable venue building operators to prioritize and deliver improved patron experiences while providing unprecedented safety. Xtract One’s innovative AI-powered Gateway product enables companies to covertly screen for weapons at points of entry without disrupting the flow of traffic. Its AI-based Xtract One Vision allows venue and building operators to identify weapons and other threats inside and outside of facilities, and Xtract One View provides valuable intelligence for optimizing operations. For more information, visit www.xtractone.com or connect on Facebook, X, and LinkedIn.
For further information, please contact:
Xtract One Inquiries: info@xtractone.com, http://www.xtractone.com
Media Contact: Kristen Aikey, JMG Public Relations, 212-206-1645, kristen@jmgpr.com
Investor Relations: Chris Witty, Darrow Associates, 646-438-9385, cwitty@darrowir.com
1 Supplementary Financial Measures:
The Company utilizes specific supplementary financial measures in this earnings release to allow for a better evaluation of the operating performance of the Company’s business and facilitates meaningful comparison of results in the current period with those in prior periods and future periods. Supplementary financial measures do not have any standardized meaning prescribed under IFRS and therefore may not be comparable to measures presented by other companies. Supplementary financial measures presented in this earnings release include ‘Agreements pending installation’ and ‘Total contract value of new bookings.’ Agreements pending installation reflects total value of signed contracts awarded to the Company that has not been installed at the customer site. ‘Total contract value of new bookings’ is comprised of all new contracts signed and awarded to the Company, regardless of the performance obligations outstanding as of the end of the reporting period. Total contract value is the aggregate value of sales commitments from customers as at the end of the reporting period without consideration of the Company’s completion of the associated performance obligations outlined in each contract.
CAUTIONARY DISCLAIMER STATEMENT:
This news release contains forward-looking statements within the meaning of applicable securities laws that are not historical facts. Forward-looking statements are often identified by terms such as “will”, “may”, “should”, “anticipates”, “expects”, “believes”, and similar expressions or the negative of these words or other comparable terminology. All statements other than statements of historical fact, included in this release are forward-looking statements that involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from the Company’s expectations include but are not limited to the risks detailed from time to time in the continuous disclosure filings made by the Company with securities regulations. The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Company. The reader is cautioned not to place undue reliance on any forward-looking information. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement. The forward-looking statements contained in this news release are made as of the date of this news release and the Company will update or revise publicly any of the included forward-looking statements only as expressly required by applicable law.
No securities exchange or commission has reviewed or accepts responsibility for the adequacy or accuracy of this release.
Unaudited Interim Statements of Loss and Comprehensive Loss for the Three and Nine Month Periods Ended April 30, 2024 and 2023
The following table is extracted from the Company’s unaudited condensed consolidated interim financial statements and presented in Canadian dollars to demonstrate the Statements of Loss and Comprehensive loss for the three and nine months ended April 30, 2024 and 2023:
Three months ended April 30, Nine months ended April 30, 2024 2023 2024 2023 Revenue Platform revenue$4,585,415 $802,559 $10,332,039 $1,950,431 Xtract revenue
98,224 72,837 388,011 386,695 Total revenue$4,683,639 $875,396 $10,720,050 $2,337,126 Cost of revenue Platform cost of revenue
$1,844,275 $320,739 $3,904,174 899,789 Xtract cost of revenue 132,948 25,689 241,377 193,891 Total cost of revenue$1,977,223 $346,428 $4,145,551 $1,093,680 Gross profit$2,706,416 $528,968 $6,574,499 $1,243,446 Operating expenses Selling and marketing
$1,259,445 $996,475 $4,066,829 $3,447,929 General and administration 1,936,552 1,801,995 5,277,387 5,337,340 Research and development 2,182,756 1,505,471 5,967,553 5,190,100 Loss on inventory write-down 4,167 1,974 111,180 316,077 Loss on retirement of assets 40,538 22,967 40,538 104,241 Total operating expenses$5,423,458 $4,328,882 $15,463,487 $14,395,687 Loss from operations (2,717,042) (3,799,914) (8,888,988) (13,152,241) Other income Unrealized gain (loss) on investments – (58,334) – 58,333 Interest and other income 44,704 31,468 197,287 77,574 Loss and comprehensive loss for the period$(2,672,338) $(3,826,780) $(8,691,701) $(13,016,334) Weighted average number of shares 200,110,734 183,575,821 198,924,490 169,778,811 Basic and diluted loss per share $(0.01) $(0.02) $(0.04) $(0.08)
Unaudited Interim Statements of Financial Position as of April 30, 2024 and July 31, 2023
The following table is extracted from the Company’s unaudited condensed consolidated interim financial statements and presented in Canadian dollars to demonstrate the Company’s financial position as at the periods ended April 30, 2024, and July 31, 2023:
April 30,
2024 July 31,
2023 Assets Current assets Cash and cash equivalents $9,740,394 $8,327,449 Receivables 4,113,437 847,429 Prepaid expenses and deposits 691,922 1,026,668 Current portion of deferred cost of revenue 359,481 – Inventory 2,772,225 1,602,971 17,677,459 11,804,517 Property and equipment 2,574,087 2,063,817 Intangible assets 4,239,275 4,843,700 Long-term portion of deferred cost of revenue 600,545 – Right of use assets 170,670 286,796 Total assets $25,262,036 $18,998,830 Liabilities Current liabilities Accounts payable and accrued liabilities $3,462,046 $2,519,350 Current portion of deferred revenue 3,641,703 968,509 Current portion of lease liability 178,605 232,483 7,282,354 3,720,342 Non-Current liabilities Non-current portion of deferred revenue 3,095,917 411,232 Non-current portion of lease liability 32,028 124,358 $10,410,299 $4,255,932 Shareholders’ equity Share capital $143,436,424 $135,823,337 Contributed surplus 15,607,712 14,420,259 Accumulated deficit (144,192,399) (135,500,698) $14,851,737 $14,742,898 Total liabilities and shareholders’ equity $25,262,036 $18,998,830
Unaudited Interim Statements of Cash Flows for the Nine Months Ended April 30, 2024 and 2023
The following table is extracted from the Company’s unaudited condensed consolidated interim financial statements and presented in Canadian dollars to demonstrate the Company’s cash flows for the nine month periods ended April 30, 2024, and 2023:
Nine months ended April 30, 2024 2023 Cash flow used in operating activities Loss and comprehensive loss for the period $(8,691,701) $(13,016,334) Adjustment for: Share-based compensation 668,555 810,666 Depreciation 938,567 650,052 Amortization 604,425 604,425 Finance cost 17,839 34,165 Loss on inventory 111,180 316,077 Loss on retirement of assets 40,538 104,241 Other income – (20,000) Unrealized gain on investments – (58,333) (6,310,597) (10,575,041) Changes in non-cash working capital Receivables (3,266,008) 1,131,484 Prepaid expenses and deposits 334,746 (22,857) Inventory (3,664,444) (1,110,636) Deferred cost of revenue 172,754 – Accounts payable and accrued liabilities 942,696 (399,513) Deferred revenue 5,357,879 250,669 Cash used in operating activities (6,432,974) (10,725,894) Cash flow used in investing activities Purchase of property and equipment – (32,539) Cash used in investing activities – (32,539) Cash flow from financing activities Proceeds on issue of share capital, net of share issue costs 8,131,985 13,311,601 Lease payments (286,066) (279,576) Cash received from financing activities 7,845,919 13,032,025 Net increase in cash for the period $1,412,945 $2,273,592 Cash beginning of the period 8,327,449 6,277,321 Cash end of the period $9,740,394 $8,550,913