Direct Communication Solutions Announces Audited Annual Financial Statements for 2024

Rhea-AI Summary

Direct Communication Solutions (DCSX) released its FY-2024 audited financial results, showing a strategic shift towards SaaS solutions. Revenue decreased 51% to $6.4 million from $13 million in 2023, reflecting the company's prioritization of high-margin recurring revenue over one-time hardware sales. The net loss improved to $1.76 million from $5.09 million in 2023, while Adjusted EBITDA improved 19% to ($2.1 million). Key operational highlights include adding 1,404 new recurring revenue subscribers, maintaining a 34% gross margin, and securing a $3M customer backlog. The company won the IoT Product of the Year award and partnered with UScellular for video telematics. Post FY-2024, William Espley was appointed Chairman of the Board, allowing CEO Chris Bursey to focus on operations.

Positive

• Net loss improved significantly from $5.09M to $1.76M
• Added 1,404 new recurring revenue subscribers
• Strong customer backlog of $3M in purchase orders
• Maintained stable gross margin at 34%
• 19% improvement in Adjusted EBITDA
• Won IoT Product of the Year award

Negative

• Revenue declined 51% year-over-year to $6.4M
• Gross profit decreased 51% to $2.2M
• Continued negative Adjusted EBITDA of ($2.1M)

San Diego, California--(Newsfile Corp. - May 1, 2025) - Direct Communication Solutions, Inc. (OTC Pink: DCSX) (CSE: DCSI) (FSE: 7QU0) ("DCS" or the "Company"), a leading provider of information technology solutions for the Internet of Things (IoT) market, is pleased to announce the posting of its Audited Annual Financial Statements for the fiscal year ended December 31, 2024 (the "FY-2024"), along with the corresponding Management Discussion & Analysis ("MD&A") on SEDAR+.

Significant Highlights

• Ongoing Transition to SaaS Solutions: Continued executing on our strategy to transition to a SaaS-focused model with an emphasis on high-margin, recurring revenue. Added 1,404 new recurring revenue subscribers, including 402 MiFleet + Vision video telematics subscribers in Q4 of 2024.
• Backlog of Customer Purchase Orders: Ended FY 2024 with a strong customer backlog of $3M in customer purchase orders for Smart Hardware products
• IoT Project of the Year: First American based company to win the IoT Product of the Year for best IoT Innovation for Asset Protection.
• MiFleet + Vision Promotion: Partnered with UScellular on a Q4 2024 video telematics promotion that resulted in record new subscribers.
• Fuel Dispensing and Audit Solution: Delivered a custom designed IoT solution to manage and audit fuel dispensing for IT&E in Guam for the Guam Port Authority.
• IoT Device Approvals: Approved multiple IoT devices on the major cellular network operators to position DCS as a leading provider of IoT solutions to our customers and partners.

Financial Performance

Direct Communication Solutions Inc. reported fiscal year 2024 revenues of $6.4 million (U.S.), compared to $13 million (U.S.) in 2023, representing a 51% year-over-year decrease. This decrease is attributed to our ongoing restructuring to prioritize long term, high-margin recurring SaaS revenue over lower-margin, one-time hardware sales.

The fiscal year 2024 gross profit was $2.2 million (U.S.), compared to $4.4 million (U.S.) in FY 2023, reflecting a 51% decrease. The gross margin stayed constant at 34% in both FY 2024 and FY 2023. The net loss for FY 2024 was $1.76 million (U.S.), a reduction from a net loss of $5.09 million (U.S.) in FY 2023. Adjusted EBITDA for FY 2024 was ($2.1 million) (U.S.), compared to ($2.6 million) in FY 2023, marking a 19% improvement.

CEO Commentary

"In 2024, we continued to execute our strategic transition towards long term, high-margin, recurring SaaS revenues based on our industry leading IoT services and solutions," said Chris Bursey, CEO of Direct Communication Solutions. "Our efforts are reflected in the increased SaaS revenues and improved gross margins. We are making significant strides in reducing operating costs while growing our SaaS subscriber base. The strategic partnerships we have forged are set to enhance our IoT solutions and contribute to our ongoing growth."

Board Announcement

Subsequent events after FY- 2024, DCS also announces a change of duties within the Board of Directors. William Espley will assume the title and responsibilities of Chairman of the Board to allow Chris Bursey to fully focus on the key operational position as CEO of the company. Mr. Espley has over forty years of experience in Board positions for public companies in both the U.S. and Canada with an emphasis on finance and investor relations.

About Direct Communication Services Inc.

DCSI is a technology solutions integrator focusing on connecting the Internet of Things. We provide real solutions that solve real problems. Our software applications and scalable cloud services collect and assess business-critical data from all types of assets. DCSI is headquartered in San Diego, California and is publicly traded on the OTCQX ("DCSX"), Canadian Securities Exchange ("DCSI") and Frankfurt Stock Exchange ("7QU0"). For more information, visit www.dcsbusiness.com. DCSI and the DCSI logo are among the trademarks of DCSI in the United States. Any other trademarks or trade names mentioned are the property of their respective owners.

Contacts

Chris Bursey, CEO
cbursey@dcsbusiness.com
858-525-2483

Bill Espley, Chairman of the Board
Bill.espley@gmail.com
604-767-3458

Forward-Looking Statements

This release contains forward-looking statements reflecting management's current views of future events and operations. These statements are based on current expectations and assumptions, subject to risks and uncertainties that could cause results to differ materially. DCS believes that these potential risks and uncertainties include, without limitation: the ongoing COVID-19 pandemic, the Company's dependence on third-party manufacturers, suppliers, technologies, and infrastructure; risks related to intellectual property; industry risks, including competition, online security, government regulation, and global economic conditions; and the Company's financial position and need for additional funding. Statements in this release should be evaluated in light of these factors. These risk factors and other important factors that could affect our business and financial results are discussed in our Management's Discussion and Analysis, periodic reports, and other public filings available on SEDAR+ at www.sedarplus.ca and posted with the OTC Disclosure and News Service. DCS undertakes no duty to update or revise any forward-looking statements.

Neither the Canadian Securities Exchange nor its Regulation Services Provider (as that term is defined in the policies of the Canadian Securities Exchange) accepts responsibility for the adequacy or accuracy of this release.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/250413

FAQ

What was DCSX's revenue and net loss for fiscal year 2024?

DCSX reported revenue of $6.4 million and a net loss of $1.76 million for fiscal year 2024.

How many new subscribers did Direct Communication Solutions add in 2024?

DCS added 1,404 new recurring revenue subscribers, including 402 MiFleet + Vision video telematics subscribers in Q4 2024.

Why did DCSX's revenue decrease in 2024?

The 51% revenue decrease was due to the company's strategic restructuring to prioritize long-term, high-margin recurring SaaS revenue over lower-margin, one-time hardware sales.

What was Direct Communication Solutions' gross margin in 2024?

DCSX maintained a gross margin of 34% in FY 2024, unchanged from FY 2023.

Who is the new Chairman of DCSX's Board of Directors?

William Espley was appointed Chairman of the Board, allowing CEO Chris Bursey to focus on operational duties.