Mr. Peter Evans reports

XTRACT ONE RELEASES THIRD QUARTER FISCAL 2023 FINANCIAL RESULTS

Xtract One Technologies Inc. has released its third quarter results for the three- and nine-month periods ended April 30, 2023. All information is in Canadian dollars unless otherwise indicated.

The following press release should be read in conjunction with the company's unaudited condensed consolidated interim financial statements, prepared in accordance with international financial reporting standards (IFRS) and the company's management's discussion and analysis for the periods ended April 30, 2023, and 2022, which can be found under the company's profile on SEDAR.

"I am pleased to share with investors that we are experiencing a record year for sales activity. The bookings generated by the platform operating segment was a 792-per-cent increase compared to the same period last year," stated Peter Evans, chief executive officer of Xtract One. "In the last three months alone, we have more than doubled the total contract value of signed agreements in the current year, and I am pleased with the pace at which our SmartGateway solution is gaining traction in the marketplace. The demand for our products is significant, and we are only scratching the surface of the total addressable market. As we execute on our business strategy, we continue to balance scaling the business efficiently while focusing on keeping customers highly satisfied."

Company highlights for the fiscal quarter ended April 30, 2023

The following is a summary of the key business highlights for the fiscal quarter ended April 30, 2023:

• Total contract value (TCV) of new bookings (1) was $9.8-million as of April 30, 2023, which is an increase of 792 per cent compared with the same balance as of April 30, 2022. Almost $5.6-million of TCV was signed during the three months ended April 30, 2023, representing a record quarter for the company;
• Platform contractual backlog was $3.1-million as of April 30, 2023, as compared with $1.2-million as of April 30, 2022, representing an increase of 160 per cent. The platform backlog as of April 30, 2023, excludes an additional $7.9-million in signed agreements that are pending installation (1), representing an increase of $6.3-million over last year and an increase of $4.9-million from the previous quarter;
• Accelerated top-line growth for the company's platform operating segment with approximately $800,000 in revenue for the three months ended April 30, 2023, representing an 841-per-cent increase over the same period in 2022 as the company begins to see traction in its subscription revenue;
• Completed a strategic investment of $13.4-million from Madison Square Garden Sports Corp. to finance continued innovation and support accelerated growth in revenue;
• Entered into a commercial agreement with Sphere Entertainment Co. (formerly Madison Square Garden Entertainment Corp.), which allows Sphere Entertainment Co. and its affiliate Madison Square Garden Entertainment Corp. (MSG Entertainment) (formerly MSGE Spinco Inc.) to deploy SmartGateway solutions across the Sphere in Las Vegas, which is expected to open in September, 2023, and MSG Entertainment's portfolio of iconic venues, including New York's Madison Square Garden, The Theater at Madison Square Garden, Radio City Music Hall and Beacon Theatre; and The Chicago Theatre;
• Secured a contract with Oak View Group and the City of Memphis to protect all entrances at Simmons Bank Liberty Stadium in Memphis, Tenn. This 58,000-seat stadium is the home of the United States Football League's Memphis Showboats and the University of Memphis Tigers football team;
• Secured a contract with the City of Bangor and Oak View Group to deploy SmartGateway at Cross Insurance Arena to secure all entrances for concerts, conferences and other live events at the venue;
• Announced a partnership with Sentara Health to provide weapons detection services at all hospitals in Virginia and North Carolina following a successful deployment of SmartGateway entry screening technology at two of Sentara Health's hospitals; and
• Subsequent to the period, secured a contract with the City of Phoenix to increase security and ensure public safety at the city's court building, which houses the courtrooms for the Phoenix Municipal Court.

Q3 2023 financial highlights:

• Consolidated revenue was $900,000 and $2.3-million for the three- and nine-month periods ended April 30, 2023, as compared with $900,000 and $2.8-million for the same periods in 2022.
• Revenue from the platform operating segment was $800,000 and $2.0-million for the three- and nine-month periods ended April 30, 2023, as compared with $100,000 and $500,000 for the same periods in fiscal 2022, representing an increase of 841 per cent and 285 per cent, respectively.
• Revenue for the Xtract operating segment was $100,000 and $400,000 for the three- and nine-month periods ended April 30, 2023, as compared with $900,000 and $2.3-million for the same period in 2022 as the company focuses its efforts on the growing platform business.
• Loss and comprehensive loss was $3.8-million for the three-month period ended April 30, 2023, compared with $4.4-million for the same period last year. The decrease in net loss for the three-month period pertains to an overall reduction in expenses as well as an increase revenue from the platform operating segment.
• Loss and comprehensive loss was $13.0-million for the nine-month period ended April 30, 2023, compared with $8.6-million for the same period in 2022. The increase in net loss for the nine-month period pertains primarily to the $3.3-million in non-dilutive financing received in the prior fiscal year and a decrease in revenue from the Xtract operating segment as the company focuses on growing the platform business.

Conference call details

Xtract One will host a conference call to discuss its annual results on Thursday, June 8, 2023, at 5:30 p.m. EST. Mr. Evans, Xtract One chief executive officer and director, and Karen Hersh, chief financial officer and corporate secretary, will provide an overview of the financial results along with management's outlook for the business, followed by a question-and-answer period.

Investors may register for the live conference call on-line. Participants should dial in at least 10 minutes prior to the start of the call. A recording of the call will be available on the company's website after the conference call concludes.

About Xtract One Technologies Inc.

Xtract One Technologies is a leading technology-driven threat detection and security solution leveraging artificial intelligence to provide seamless and secure patron access control experiences. The company makes unobtrusive threat detection systems that enable venue building operators to prioritize and deliver improved patron experiences while providing unprecedented safety. Xtract One's innovative multisensor Gateway product enables companies to covertly screen for weapons at points of entry without disrupting the flow of traffic. Its AI-based Xtract Vision allows venue and building operators to identify weapons and other threats inside and outside of facilities, and Xtract One Insights provides valuable intelligence for optimizing operations.

We seek Safe Harbor.