Mr. Larry O'Reilly reports

ARHT MEDIA ANNOUNCES Q2 2023 OPERATING RESULTS

Arht Media Inc. has released its financial results for the second quarter ended June 30, 2023.

Q2 2023 financial update:

• Revenue for Q2 2023 was $2.1-million compared with $2-million for Q2 2022, a 3-per-cent increase. The increase reflects the company's sales focus transition to fixed installations versus events, with the corresponding longer sales cycle, which is expected to positively impact the company financials in the remaining quarters of 2023 and beyond.
• Q2 2023 net loss of $2.1-million versus $1.8-million in Q2 2022 primarily due to increased head count as the company continues to invest for growth.
• LTM (last 12 months) revenue was $7.5-million, an increase of 29 per cent when compared with the prior 12 months, reflecting continued positive momentum in the growth of the business.
• Cash as at June 30, 2023, was $500,000 as compared with $1.8-million at March 31, 2023.

Q2 2023 business updates:

• In April, 2023, the company signed a $500,000 contract with a leading global Fortune 50 client for the delivery of services and events throughout the month of June for several locations worldwide. Events included presentations by senior executives including the chief executive officer, who posted on social media on the Arht Capsule display.
• In May, 2023, the International Institute for Management Development (IMD) installed Arht live hologram technology at its campuses in Lausanne, Switzerland, and Singapore to expand the scope and reach of its executive education programs while minimizing climate impact. IMD is considered a world leader in executive education.
• In May, 2023, the company partnered with Paramount+ to beam stars of the hit original series Star Trek: Strange New Worlds as live holograms using the company's Arht Capsule displays for an exclusive panel at MCM's London Comic Con. Actors in both Los Angeles and New York appeared as a panel on stage in London and took questions from an in-person moderator as well as the live audience.
• In June, 2023, EY chief information officer Jeff Wong authored a white paper promoting the benefits of Arht's hologram technology to help reduce costs and make executives more efficient. In a LinkedIn post he was quoted, "Beam In ... Beam Out! Hologram technology is bringing the world closer together."
• In June, 2023, the company entered an accounts receivable facility with Sallyport Commercial Finance for up to $2-million. Under the terms of the agreement signed with Sallyport, the company can draw down up to $2-million based on its accounts receivable and inventory balances. This line of credit comes with a one-year term and an annual interest rate of approximately 14 per cent.
• In June, 2023, the company partnered with Spain's Newtonlab Space to be the exclusive global distributor of the multipanel holographic display Show Window Max. This new display features a three-wide holographic display and measures about 330 centimetres (10 feet and 10 inches) in width and 220 cm (seven feet and three inches) in height. This technology is ideal for retail, entertainment, museums, trade shows, experience centres, airports or anywhere large crowds gather.
• In June, 2023, the company signed and delivered its first Capsule subscription agreement with a leading global retailer. The client operates over 5,000 retail stores globally and held its first hologram event less than two weeks after the agreement was signed.
• In June, 2023, the company revealed its highly anticipated new iOS and client interface which does not require any in-person technicians to conduct live two-way holographic streaming. Called One Click Connect, it is as simple as scheduling a Zoom call.
• In June, 2023, the company established a network operating centre for its hologram network to support its customers with 24/7 support in worldwide time zones. This is a first in the hologram industry.
• In June, 2023, the company did not renew its prior revenue share agreement with WeWork and elected to reduce the number of WeWork locations to major centres in New York, Los Angeles and Paris.

Q2 2023 subsequent events:

• The company completed extensive testing of its Capsule hologram display and has received CE, ULI, CSA and CAUK certifications to support its continued deployment of permanent hologram displays internationally. Certification for 22 jurisdictions around the world will be completed in Q3 2023.
• The company closed a private placement of secured subordinated debentures in an aggregate of approximately $2.03-million principal amount. The debentures mature on Aug. 3, 2025, and carry an annual interest rate of 15 per cent, accrued and payable semi-annually, payable in cash or shares at the option of the company.
• The company trialled an artificial intelligence-powered virtual concierge at four London area WeWork locations for a six-week duration. Using voice-to-text AI technology, the virtual concierge could answer approximately 200 commonly asked questions of the WeWork community desk members. This technology has broad reaching applications in retail, hospitality, condominiums, sports venues and any place where the general public needs information.
• The board of directors accepted director David Wetherald's resignation from the board for personal reasons. The board would like to thank Mr. Wetherald for his valuable contribution as a director and committee chair over the past five years.

"Q2 2023 was a pivotal quarter for Arht Media as numerous enterprise organizations are testing Arht's permanent displays in an effort to save money, reduce travel and attract audiences. In addition, we introduced several industries leading technology advances including: (1) One Click Connect, which is as easy as scheduling a Zoom call and does not require on-site technicians for holographic live streaming; and (2) our new CMS, RMS, iOS and user interface, which allows us to have the best holographic display to scale our business. While revenue in Q2 was below our expectations, we believe we will achieve strong revenue growth in the second half of 2023 as all these key pieces fall into place with new and existing customers," stated Larry O'Reilly, chief executive officer of Arht Media. "As our product offerings continue to generate interest from some of the most recognizable global brands, management has taken pro-active steps to reduce operating costs in order to expedite our profitability goals."

About Arht Media Inc.

Arht is a pioneer and the global leader in live hologram technology. Thanks to its patented end-to-end technology, executives, medical experts, educators, entertainers and thought leaders can travel at the speed of light to any destination.

Arht was founded in 2014 and is publicly traded on the TSX Venture Exchange. Arht has offices in North America, Europe and Asia, and operates from its own studios in locations from Toronto to Singapore, as well as a large network of partner studios in every region.

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