Edge Total Intelligence Inc. Reports Second Quarter 2022 Results and Provides Operational Outlook
August 29 2022 - 11:27PM
Edge Total Intelligence Inc. (TSXV: CTRL; FSE:Q5i) (“edgeTI”, “we”,
“our” or the “Company”), a leader in real-time digital operations,
announces operating and consolidated results for the second quarter
2022 (“Q2-2022”). Financial information is expressed in United
States (US) dollars unless otherwise indicated. The Company’s
related financials and management discussion and analysis for the
second quarter, 2022 are posted on its profile on SEDAR
(www.sedar.com).
Financial Highlights for
Q2-2022
- Total revenue of
$951K versus $961K for the quarter ending June 30, 2021
(“Q2-2021”), roughly flat over the prior quarter ending March 31,
2022 (“Q1-2022”) at $956K.
- Subscription
revenue grew 6% to $814,749 from $765,367 Q2-2021.
- Gross profit
increased 11% to $701,193 from $633,117 in Q2-2021.
- Reduced net loss
by 51% or $663K over Q2-2021 as the Company works to reach
profitable operations.
Operational Highlight for
Q2-2022
- Teaming with
SD3IT, LLC for the TechNet Indo-Pacific Spring Symposium resulted
in a strategic partnership for work in data transformation and led
to the Company being invited to the opening of the Hawai’i
Indo-Pacific Innovation Campus (HIPIC), an Independent Test
Organization (ITO) supporting the U.S. Army Pacific Command.
Subsequent to Q2-2022
- The Company
secured a $1 million operating line of credit with Lotus Domaine
III (“Lotus”), its largest shareholder, based on the Company’s
projected cash flows through summer.
- On July 1, the
Company was one of 27 companies awarded an indefinite delivery/
indefinite-quantity (IDIQ) contract by the U.S. Air Force with a
ceiling of $950 million through May 2025 for the maturation,
demonstration, and proliferation of capability across platforms and
domains, leveraging open systems design, modern software and
algorithm development in order to enable Joint All Domain Command
and Control (JADC2) for U. S. Armed Forces and Allies.
- edgeTI and
OnSolve formed a strategic partnership to deliver OnSolve’s
AI-driven risk intelligence and critical communications into
edgeTI’s platform to provide full operational visibility and
control for smart cities and enterprises looking to achieve
organizational resilience in their operations, logistics, and
supply chain. The strategic partnership establishes referral
relationships between each company’s sales teams and formalizes the
integration between the two company’s products.
- The Company’s
new low code and intelligent automation capabilities produced
significant cost and time savings in live operational trials and is
receiving strong interest from service providers, which management
believes will open additional high-revenue growth opportunities in
the remainder of 2022 and beyond.
- Jim Barrett, CEO
was accepted into Forbes Technology Council, an invitation-only
community for world-class CIOs, CTOs, and technology executives,
which will improve management’s access to a wide range of business
leaders.
“We continue to build upon our government
program as a trusted technology supplier to the U.S. Government as
evidenced by our inclusion in the JADC2 contract and building new
partnerships with SD3IT and OnSolve,” said Jim Barrett, Chief
Executive Officer.
“I am proud of the work our development team has
done to create additional low-code and new automation capabilities
within our edgeCore platform. Live operational trials with
strategic customers have delivered tremendous cost and time
savings, like speeding up existing operations by more than 80%,”
said Jim Barrett. “These capabilities have not only proven
beneficial to these early customers, but we think the advances will
serve as an exciting accelerator of revenue growth for the Company
in the future.”
Operational OutlookOngoing
global business challenges and uncertainty, which are well
reported, led to delayed customer decisions on expansions and new
projects that impacted Q2 revenue growth. In contrast, the same
business challenges and uncertainty are driving increased demand
from government and service providers. National defense and smart
cities initiatives demonstrate increased need to improve the
visualization of their operations in real-time and accelerate
data-driven decision making and automation. Business process
outsourcers and managed services providers experiencing talent
shortages and rising inflation costs that cut into their profit
margins are demanding novel approaches to the automation of
business operations. In both cases, the Company believes these
trends will drive further pipeline development leading to new
growth, while it navigates continued uncertainty and new
challenges.
Selected Financials
|
Three Months Ended June 30 |
Six Months Ended June 30 |
Second Quarter and Six Months Ended |
|
2022 |
|
2021 |
|
2022 |
|
2021 |
Revenue |
$ |
951,219 |
|
$ |
960,585 |
|
$ |
1,907,740 |
|
$ |
2,184,175 |
|
Cost of revenue |
|
250,026 |
|
|
327,467 |
|
|
485,848 |
|
|
673,132 |
|
Gross profit |
$ |
701,193 |
|
$ |
633,118 |
|
$ |
1,421,892 |
|
$ |
1,511,043 |
|
Gross margin % |
|
74 |
% |
|
66 |
% |
|
75 |
% |
|
69 |
% |
|
|
|
|
|
Selling and marketing expenses |
|
388,966 |
|
|
369,208 |
|
|
780,564 |
|
|
772,088 |
|
Administrative expenses |
|
612,245 |
|
|
702,955 |
|
|
1,343,707 |
|
|
1,139,632 |
|
Research and development expenses |
|
359,673 |
|
|
295,400 |
|
|
779,115 |
|
|
578,697 |
|
Other (income) expenses |
|
111,619 |
|
|
333,242 |
|
|
218,811 |
|
|
(96,434 |
) |
Operating Expense |
$ |
1,472,503 |
|
$ |
1,700,805 |
|
$ |
3,122,197 |
|
$ |
2,393,983 |
|
Operating income (loss) |
$ |
(771,310 |
) |
$ |
(1,067,687 |
) |
$ |
(1,700,305 |
) |
$ |
(882,940 |
) |
Interest |
|
229,858 |
|
|
223,441 |
|
|
463,735 |
|
|
493,218 |
|
Change in fair value of warrant liability |
|
(283,362 |
) |
|
- |
|
|
(119,270 |
) |
|
Foreign exchange loss |
|
(90,198 |
) |
|
- |
|
|
(50,572 |
) |
|
Loss before income taxes |
$ |
(627,608 |
) |
$ |
(1,291,128 |
) |
$ |
(1,994,198 |
) |
$ |
(1,376,158 |
) |
Income tax expense |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Net loss |
$ |
(627,608 |
) |
$ |
(1,291,128 |
) |
$ |
(1,994,198 |
) |
$ |
(1,376,158 |
) |
Shareholder Equity |
Three Months Ended June 30 |
Six Months Ended June 30 |
2022 to 2021 Comparison |
|
2022 |
|
2021 |
|
2022 |
|
2021 |
Net loss per share - basic |
$ |
(0.03 |
) |
$ |
(0.16 |
) |
$ |
(0.11 |
) |
$ |
(0.17 |
) |
Net loss per share – diluted |
$ |
(0.03 |
) |
$ |
(0.16 |
) |
$ |
(0.11 |
) |
$ |
(0.17 |
) |
Share capital – issued and outstandingSingle
Voting Shares (SVS) – 41.7% |
|
18,993,459 |
|
|
8,004,000 |
|
|
18,993,459 |
|
|
8,004,000 |
|
Multiple Voting Shares (MVS) – 58.3% |
|
26,600 |
|
|
- |
|
|
26,600 |
|
|
- |
|
About edgeTI
edgeTI helps customers sustain situational
awareness and accelerate data-driven action with its real-time
digital operations software, edgeCore™. Global enterprises, service
providers, and governments are more profitable when insight and
action are united to deliver fluid experiences via the platform's
low-code development capability and composable experiences. With
edgeCore, customers improve their margins and agility by rapidly
transforming siloed systems and data across evolving, complex
situations in business, technology, and cross-domain operations —
helping the achieve the impossible. Traded on: TSXV: CTRL FSE:
Q5i
Learn more at https://edgeti.com.
For further Information contact:
Nick BrigmanPhone: 888-771-3343 Email:
ir@edgeti.com
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
Forward-Looking Information and
Statements Certain statements in this news release are
forward-looking statements or information for the purposes of
applicable Canadian and US securities law, including statements
regarding market projections, customer impacts of product
development, the execution of the Company's growth and marketing
strategies, the Company's expectations for its 2022 and 2023 MRR
and revenues, the Company's ability to enter into strategic
partnerships and continue to develop easy to use products, and
other matters. Forward-looking statements consist of statements
that are not purely historical, including any statements regarding
beliefs, plans, expectations, or intentions regarding the future.
Such information can generally be identified by the use of
forwarding-looking wording such as "may", "expect", "estimate",
"anticipate", "intend", "believe" and "continue" or the negative
thereof or similar variations. 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,
including but not limited to, business, economic and capital market
conditions.
Such statements and information are based on
numerous assumptions regarding present and future business
strategies and the environment in which the Company will operate in
the future, including the demand for its products, anticipated
costs, and the ability to achieve goals. Factors that could cause
the actual results to differ materially from those in
forward-looking statements include, the continued availability of
capital and financing, the impact of COVID-19 or other viruses and
diseases on the Company's ability to operate, competition and
general economic, market or business conditions. Forward-looking
statements contained in this news release are expressly qualified
by this cautionary statement. The reader is cautioned not to place
undue reliance on any forward-looking information. The
forward-looking statements contained in this news release are made
as of the date of this news release. Except as required by law, the
Company disclaims any intention and assumes no obligation to update
or revise any forward-looking statements, whether as a result of
new information, future events or otherwise.
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