Mr. Ryan Hamlin reports
POSABIT REPORTS FOURTH QUARTER AND ANNUAL 2023 FINANCIAL RESULTS
Posabit Systems Corp. has released its financial results for the three and 12 months ended Dec. 31, 2023.
"Despite the challenges posed by several industry-wide payment disruptions in 2023, I am proud that we achieved a combined 23% growth in our core Payments and Point-of-Sale business, excluding a one-time licensing fee booked in 2022. Our unwavering dedication to supporting our merchants, clients, and providing best-in-class service remains our top priority," said Ryan Hamlin, co-founder and CEO of POSaBIT.
Hamlin continued, "Our Point-of-Sale business continues to grow at a significant pace and remains the most used Point-of-Sale for cannabis dispensaries in Washington State. Our current run-rate for company-wide revenue, and pipeline, alongside the effective implementation of cost reduction measures, has put us on a path towards achieving positive free cash flow in Q2 and continued growth in revenue and operating cash flow."
Provides Update on Application to List Common Shares on the TSX Venture Exchange
Over the past several months, POSaBIT has been working to advance the proposed listing of its common shares ("Common Shares") on the TSX Venture Exchange (the "TSXV"). The Company remains focused on satisfying applicable regulatory and TSXV listing requirements. The listing of the Common Shares on the TSXV is contingent on the satisfaction of all listing requirements and there is no assurance that the TSXV will approve the Company's listing application or that the Company will complete the listing on the TSXV.
Announcement of Stephen Gledhill to Chief Financial Officer Succeeding Matthew Fowler
POSaBIT today announced the appointment of Stephen Gledhill to the position of Chief Financial Officer effective May 14, 2024. Mr. Gledhill will succeed Matthew Fowler who joined POSaBIT as CFO of its US Subsidiary in May 2021, and was appointed CFO of the Company on August 24, 2023. Mr. Gledhill previously served as the Company's Chief Financial Officer from September 17, 2018, until August 24, 2023, and has been serving in an advisory role to the Company since he vacated that office. Mr. Gledhill's appointment is subject to the final approval of the CSE.
"I want to thank Matthew Fowler for his partnership and leadership over the past three years. I wish him the best of luck as he embarks on the next chapter of his career. Having Stephen step back into this role which he previously served as the CFO of our public holding company for several years, gives me confidence that we are in good hands. Stephen brings the expertise, continuity, and vision necessary to propel our organization forward into its next chapter of success. Together, we will continue to innovate, adapt, and drive sustainable value for our stakeholders," said Hamlin.
Announces Non-Cash Earnings Restatement for 2022
As part of the Company's audit process, it was determined that the discount rate associated with the 2022 software license agreement should be increased to 12%. The change in discount rate will reduce the revenue recognized in 2022 by approximately $3 million and will shift future recognized revenue from license revenue to interest income. However, the change in discount rate will not affect the overall cash economics or timing of cash receipts from such license agreement.
Recent Operational Highlights
Recently launched five unique payment solutions to provide full redundancy moving forward for our merchants.
Released the first multiple payment methods processing terminal branded as "POSaBIT One."
Recently closed our largest day of processing volume this year on 4/20 with zero interruptions or outages.
Approved as a Master ISO for credit card transactions in anticipation of potential rescheduling of cannabis in the US as a Schedule 1 substance.
Balance Sheet
As of December 31, 2023, the Company had cash and cash equivalents of $1.5 million compared to $3.1 million as of December 31, 2022.
Subsequent to quarter end, the Company received commitments of $0.6 million for a proposed secured credit facility of up to $1 million (the "Credit Facility"). The Credit Facility is intended to be secured by certain intangible assets including a potential tax refund. If executed, the Credit Facility would mature at the earliest of the receipt of a certain tax refund by the Company or December 31, 2024, and would bear interest at 12% per annum and 2% OID.
The following tables reconcile Adjusted EBITDA to net loss, as reported.
Earnings Guidance
POSaBIT will be providing earnings guidance and revenue run-rates as part of the POSaBIT Q1 earnings release and call at the end of May 2024.
Conference Call Information
Date: May 14, 2024
Time: 4:30 PM Eastern Time
Toll Free: 888-506-0062
International: 973-528-0011
Participant Access Code: 649259
Webcast URL: https://www.webcaster4.com/Webcast/Page/2708/50355
Conference Call Replay Information:
The replay will be available approximately 1 hour after the completion of the live event.
Toll Free: 877-481-4010
International: 919-882-2331
Replay Passcode: 50355
Webcast Replay URL: https://www.webcaster4.com/Webcast/Page/2708/50355
Financial Reports
Full details of the financial and operating results are described in the Company's consolidated financial statements for the periods ended December 31, 2023 with accompanying notes. The consolidated financial statements and additional information about POSaBIT are available on the Company's website at www.posabit.com/investor-relations or on SEDAR+ at www.sedarplus.ca.
ABOUT POSABIT
POSaBIT (CSE: PBIT, OTC: POSAF) is a FinTech, working exclusively within the cannabis industry. We provide a best-in-class Point-of-Sale solution and are the leading cashless payment provider for cannabis retailers. We work tirelessly to build better financial services and transaction methods for merchants. We bring cutting-edge software and technology to the cannabis industry so that all merchants can have a safe and compliant set of services to solve the problems of a cash-only industry. For additional information, visit www.posabit.com.
We seek Safe Harbor.
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