Mr. Mike Seckler reports

EVOME MEDICAL TECHNOLOGIES PUNCTUATES TURN AROUND PLAN WITH STRONG FOURTH QUARTER RESULTING IN POSITIVE ANNUAL ADJUSTED EBITDA FOR FISCAL YEAR 2023

Evome Medical Technologies Inc. has released preliminary annual financial results for the year ending Dec. 31, 2023. Because of a strong fourth quarter, the company generated positive adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) for 2023.

Summary of preliminary annual financial results for 2023:

• Generated annual revenues of $62.6-million;
• Generated annual gross margin of $22.5-million;
• Annual gross margin as percentage of sales of 36 per cent;
• Generated annual adjusted EBITDA of $852,000.

"We can now say with confidence, we have completed the turnaround of this company," said chief executive officer Mike Seckler. "This past year, 2023, was a tale of two different companies. The first two quarters were frankly calamitous with mounting losses, unserviceable debt, and flat or declining revenues. I was brought into the company by the board at the end of June coinciding with the end of the second quarter. Starting July 1, 2023, the first day of our third quarter, our team focused on increasing sales, cutting costs and restructuring our debt to make it manageable and serviceable. I am very proud of our team at the operating unit level, they understood the gravity of the situation and we worked together to make tough decisions that resulted in two consecutive quarters of positive adjusted EBITDA. I am pleased with our bankers who worked with our creditors to restructure our debt to give us room to turn this company around. I am also grateful that we had patient creditors that understood and believed in the plan.

"As our first quarter ends, we continue to make improvements. But rather than working to shore up the company, we are working on several fronts to increase revenues and profits. We are working to reduce debt by divesting non-core business units. We have also launched our RST product and have several orders. We have very strong demand internationally and spent the first quarter retooling our operations to deliver the RST and additional products overseas. We anticipate this will be reflected in improved revenues and margins from the second quarter onward. We also plan to launch the SpaceTek Knee product, co-developed by NASA, toward the end of the year. Because we are driving toward a growing and profitable business with a normalized level of debt, we are finding more opportunities to expand our business. I am excited to report our first quarter accomplishments soon. And lastly, I appreciate our shareholders support of me and my plan. I believe we have succeeded in saving this company, now we focus on improving the share price."

Unless otherwise specified, all financial information is presented in Canadian dollars and has been rounded to the nearest hundred thousand. The company will file its financial statements for the year ended Dec. 31, 2023, and related management discussion and analysis (in the form of an annual report on Form 10-K) on SEDAR+ and with the United States Securities and Exchange Commission on April 16, 2024.

We seek Safe Harbor.