TORONTO and SEATTLE — POSaBIT Systems Corporation, a leading provider of payments and point-of-sale infrastructure in the cannabis industry, today announced its financial results for the three months ended June 30, 2024.
“We are pleased to report adjusted EBITDA profitability and positive free cash flow in the second quarter, marked by significant achievements across all key metrics. During the second quarter, POSaBIT increased revenue and gross margins, while decreasing overall operating expenses. POSaBIT increased cash on hand by ~$200K in the second quarter. Additionally, we launched two new products in the market with our POSaBIT Pay Apple and Android application, as well as our newly redesigned eCommerce Menu for our Point-of-Sale customers. Both of these have received positive momentum in the market, and we anticipate continued broad adoption in Q3 and Q4,” said Ryan Hamlin, co-founder and CEO of POSaBIT.
Hamlin continued, “As we look ahead to the next six months, our primary focus is on continued adjusted EBITDA profitability and growing our cash reserves while still achieving a steady rate of growth in our Point-of-Sale and Payments lines of business. Our commitment to our investors is to position POSaBIT for long-term, sustainable success, ensuring that we not only meet our immediate objectives but also lay a solid foundation for enduring profitability and free cash flow.”
Recent Operational Highlights
- Launched POSaBIT Pay and new Apple and Android phone app
- Successful eCommerce Menu beta – broad rollout in process in Q3 and Q4
- On track to process over $1B in annual gross sales in Washington State through the POSaBIT Point-of-Sale system
- Substantially reduced hosting costs, partner revenue sharing and overall processing fees
Balance Sheet
As of June 30, 2024, the Company increased cash on hand and cash equivalents to ~$1.1 million compared to $900 thousand as of March 31, 2024.
Run Rate Guidance
For the quarter ending June 30, 2024, POSaBIT generated Adjusted Revenue of ~$5.0 million and Adjusted Gross Profit of ~$3.0 million, implying ~$20.0 million and ~$12.0 million of annualized Adjusted Revenue and Adjusted Gross Profit, respectively. As we continue to execute on our business plan, we expect these run rates to increase and will be updated as part of our quarterly earnings release.
Financial Reports
Full details of the financial and operating results are described in the Company’s consolidated financial statements for the period ended June 30, 2024, with accompanying notes. The consolidated financial statements and additional information about POSaBIT are available on the Company’s website or on SEDAR+.
Non-IFRS Measures
Adjusted Revenue, Adjusted Gross Profit and Adjusted EBITDA are non-IFRS measures used by management that do not have any prescribed meaning by IFRS and may not be comparable to similar measures presented by other companies. The Company defines Adjusted Revenue as gross revenue, minus license support revenue, plus actual licensing cash received as part of POSaBIT’s licensing deals. The Company defines Adjusted Gross Profit as Adjusted Revenue less company cost of goods sold. The Company defines Adjusted EBITDA as net income or loss generated for the period as reported, before interest, taxes, depreciation and amortization and further adjusted to remove changes in fair values and expected credit losses, foreign exchange gains and/or losses, impairments. The Company believes these non-IFRS measures are useful metrics to evaluate its core operating performance and uses these measures to provide shareholders and others with supplemental measures of its operating performance. The Company also believes that securities analysts, investors and other interested parties, frequently use these non-IFRS measures in the evaluation of companies, many of which present similar metrics when reporting their results. We caution readers that Adjusted Revenue, Adjusted Gross Profit and Adjusted EBITDA are not substitutes for gross revenue, gross profit or profit/loss, respectively.
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.
