CTRL:CC - Edge Total Intelligence Inc. Reports Second Quarter 2022 Results and Provides Operational Outlook
ARLINGTON, Va., Aug. 29, 2022 (GLOBE NEWSWIRE) -- 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 Outlook
Ongoing 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 outstanding Single 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 Brigman
Phone: 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.