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Genius Group Announces 2023 Financial Results, 150% Pro Forma Revenue Growth to $70.4 million

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Genius Group (NYSE American: GNS) reported its financial results for 2023, showcasing significant growth. The company achieved a 27% increase in audited revenue to $23.1 million and a 150% rise in pro forma revenue to $70.4 million, including the impact of the FatBrain AI acquisition. The number of students and users grew 24% to 5.5 million.

Gross profit reached $11.9 million, up from $8.6 million in 2022, while net loss after tax drastically reduced by 90% to $5.7 million. Pro forma net loss was $0.8 million. The company continues to forecast a 2024 pro forma revenue of $105 million. Key developments include the launch of the Genius City model in various global hubs and the successful integration of AI tools and platforms.

Positive
  • 27% increase in audited revenue to $23.1 million.
  • 150% rise in pro forma revenue to $70.4 million.
  • 24% increase in students and users to 5.5 million.
  • Gross profit increased to $11.9 million or 52% of revenue.
  • Significant reduction in net loss after tax to $5.7 million, a 90% decrease.
  • Pro forma net loss reduced to $0.8 million.
  • Reiterated 2024 pro forma revenue guidance of at least $105 million.
  • Successful acquisition of FatBrain AI.
  • Launch of Genius City model in global cities.
  • Expansion and integration of AI tools and platforms.
Negative
  • Operating expenses remained high at $48.3 million.
  • Net loss for 2023 was still significant at $5.7 million.
  • Cash and equivalents were low at $1.3 million as of December 31, 2023.
  • Campus revenue decreased by 4% due to the ERL spin-off.
  • Pro forma cost of revenue was high at $53.3 million, impacting gross profit margins.

Genius Group's financial results for 2023 indicate a significant turnaround, with a notable 150% pro forma revenue growth to $70.4 million. This impressive increase can be largely attributed to the acquisition of FatBrain AI, which notably boosted the company's revenue base. On an audited basis, revenue grew 27% to $23.1 million, demonstrating organic growth even without the acquisition.

Gross profit margins have also shown improvement, increasing from 47% to 52% on an audited basis. This signals efficient cost management and the potential for higher profitability in future periods.

The reduction in net loss after tax from ($56.0 million) to ($5.7 million) is particularly significant, reflecting strategic cost management and effective operational improvements. Furthermore, the pro forma net loss after tax was minimized to nearly break-even at ($0.8 million).

However, investors should be cautious regarding the company’s cash position, which stood at only $1.3 million as of December 31, 2023. This low cash reserve raises concerns about liquidity and the need for potentially more financing.

Overall, the financial results point to a company on a positive growth trajectory, but with areas needing close monitoring.

Genius Group's strategic direction, particularly with the launch of the Genius City Model, reflects an innovative approach to localized learning ecosystems. Targeting cities like Singapore, Dubai and Abu Dhabi initially, with expansion plans into major global hubs, indicates a robust growth strategy that leverages AI technology to enhance educational offerings.

The increase in students and users by 24% to 5.5 million users enhances the company's market position and signals strong demand for its digital-first education solutions. This user growth is a critical metric for future revenue potential as these users can be converted into paying customers for various AI-driven tools and training programs.

The acquisition of FatBrain AI and the pending OpenExO transaction suggest a focused effort on building a comprehensive AI education platform. This aligns well with market trends where AI and education technology are growing sectors.

However, the shift from campus to digital revenue requires careful execution to ensure that the quality of education is maintained and that the new platform can sustain user engagement and retention.

In conclusion, Genius Group's strategic initiatives present a compelling growth story with high potential if executed effectively.

The integration of AI technology in Genius Group’s education platform is a significant step forward. The AI-powered GeniusU platform and the development of tools like AI Genie and AI Avatars are innovations that align with current trends in the EdTech industry. These tools can customize learning experiences and provide personalized support, which can enhance user satisfaction and educational outcomes.

The launch of the AI-driven partner portal for education and community partners is another noteworthy development. It has the potential to create a collaborative ecosystem that can drive innovation and share best practices.

However, the effectiveness of these AI tools will depend heavily on their implementation and user adoption. It is important for Genius Group to ensure that these technologies are user-friendly and effectively meet the needs of students and educators.

If successful, these AI-driven initiatives could set a new benchmark in the EdTech industry, providing Genius Group with a competitive edge.

Singapore, May 15, 2024 (GLOBE NEWSWIRE) -- Genius Group Limited (NYSE American: GNS) ("Genius Group" or the "Company"), a leading provider of AI-powered, digital-first education solutions, announced today its financial results for the year ended December 31, 2023.

Business Highlights for Fiscal 2023

  • 2023 audited revenue increased 27% to $23.1 million from $18.2 million in 2022.
  • Pro forma 2023 revenue increased 150% to $70.4 million from $28.1 million in 2022, including revenue from the FatBrain AI transaction.
  • Students and users increased 24% to 5.5 million from 4.4 million in 2022.
  • Gross profit increased to $11.9 million or 52% of revenue compared to $8.6 million, or 47% of revenue in 2022.
  • Net loss after tax reduced 90% to ($5.7) million compared to ($56.0) million in 2022. On a pro forma basis, net loss after tax reduced further to ($0.8) million.
  • Reiterates previously issued 2024 pro forma revenue guidance of at least $105 million for the full year, a 50% increase compared to 2023’s pro forma revenue of $70.4 million

Roger James Hamilton, Founder and CEO of Genius Group, commented “2023 was a year of significant growth in revenue combined with a significant reduction in costs, positioning us for strong, sustainable growth in 2024.”

“2024 is already proving to be a truly transformative year for Genius Group. The completion of the recent of acquisition FatBrain AI and pending OpenExO transaction have accelerated our plans to build a global AI education and acceleration group. We are building upon our AI-driven Edtech platform, GeniusU, with in-demand AI training and AI tools to power the exponential economies of tomorrow.”

“We are launching our Genius City Model, beginning with Singapore, Dubai and Abu Dhabi, to deliver localized learning ecosystems for students, entrepreneurs, businesses and governments to access AI education and acceleration tools with their own localized AI avatars and assistants. Our Genius City Model has attracted global interest, with nine new Genius Cities now scheduled to launch in 2024: London, Tokyo, Mumbai, Miami, Las Vegas, Toronto, Vancouver, Stockholm and Santiago.”

Audited Financial Results

The audited financial results are for the seven companies within Genius Group (excluding the FatBrain AI and pending OpenExO transactions completed and to be completed in 2024) and including nine months of Entrepreneur Resorts Ltd prior to its spin off in October 2023.

  • During the year ended December 31, 2023, overall revenue totaled $23.1 million, or an increase of 27%, compared to $18.2 million in the previous year. This was driven by an increase in Education Revenue of 37% from $13.6 million to $18.6 million and decrease in campus revenue by 4% from $4.6 million in 2022 to $4.5 million in 2023 as a result of the ERL spin off.
  • Gross profit increased to $11.9 million or 52% of revenue compared to $8.6 million, or 47% or revenue in 2022.
  • Operating expenses decreased to $48.3 million in 2023 compared to $51.1 million in 2022. The decrease in our operating expenses is the result of lower impairments offset by continued investment in our business.
  • Net loss for 2023 was ($5.7) million compared to a net loss of ($56.0) million in 2022. Earnings per diluted share were $(0.10) in 2023 compared to $(2.47) in 2022.
  • Cash and equivalents on December 31, 2023 were $1.3 million. Total assets at December 31, 2023 were $43.2 million.

Pro Forma Financial Results

Genius Group pro forma financial results is for the seven companies within Genius Group, taking into account the Group Companies including FatBrain AI with the transaction completed in March 2024, and excluding Entrepreneur Resorts Ltd, which spun off in October 2023, and pending OpenExO, as the agreement was completed in 2024 but final closing is pending various closing conditions being met.

The Pro Forma Financial Results should be viewed as the current group’s financial performance, of which the audited financial results represent a subset of this group – the group prior to the 2024 FatBrain AI transaction. The historical results do not necessarily indicate our expected results for any future periods.

  • During the year ended December 31, 2023, overall pro forma revenue totaled $70.4 million, compared to $28.1 million in 2022.
  • Pro forma gross profit was $17.0 million or 24% of revenue.
  • Pro forma net loss after tax was ($0.8) million.
  • Pro forma total assets was $97.9 million.

Strategic and Operational Highlights

  • Welcomed leading education entrepreneurs to our investor base, including Michael Moe (Founder and CEO of GSV Ventures), Brent Richardson (Past CEO and Chairman of Grand Canyon Education), Dr Ali Saeed Bin Harmal Aldhaheri (Founder and Chairman of Abu Dhabi University).
  • Added new Board Members and Executive Team, including Salim Ismail (Founder, OpenExO), Eric Pulier (Founder, Vatom), new Chairman, Michael Moe, and new CFO, Adrian Reese.
  • Completed transaction with FatBrain AI and signed agreement with OpenExo, building AI product suite
  • Launched Genius City model with first cities Singapore, Dubai and Abu Dhabi
  • Launched AI educator suite of AI Genie and AI Avatars
  • Launched full AI-driven partner portal for education and community partners
  • Moved from campus to digital revenue with spin off of ERL and closure of UAV
  • Restructured financing with full repayment of $18.3 million convertible note eighteen months ahead of schedule.

Financial Guidance

Genius Group maintains its 2024 financial guidance as we scale our GeniusU, AI-Driven Edtech platform and scale our Genius City model of local teams delivering AI training and AI tools to participating cities around the world. We believe we are on a strong, sustainable pathway of ongoing organic growth and acquisitions, leading to continued revenue growth and a path to sustainable, cash positive, profitable growth.

Profit & Loss Performance

  Pro forma  Audited Financials 
  Year Ended  Year Ended 
  December 31,  December 31, 
  2023  2023  2022 
  (USD 000’s)  (USD 000’s)  (USD 000’s) 
Revenue  70,371   23,063   18,194 
Cost of revenue  (53,325)  (11,127)  (9,555)
Gross profit  17,046   11,936   8,639 
Other Operating Income  346   344   144 
Operating Expenses  (47,753)  (48,347)  (51,121)
Operating Loss  (30,361)  (36,067)  (42,338)
Other income  32,965   32,981   418 
Other Expense  (4,070)  (3,704)  (15,151)
Net Loss Before Tax  (1,466)  (6,790)  (57,070)
Tax Benefits  644   1,079   1,063 
Net Loss  (822)  (5,711)  (56,007)
Other Comprehensive Income  (204)  (204)  (290)
Total Comprehensive Loss  (1,026)  (5,915)  (56,297)
Net income per share, basic and diluted  (0.01)  (0.10)  (2.47)
Weighted-average number of shares outstanding, basic and diluted  55,501,971   55,501,971   22,634,366 

About Genius Group

Genius Group (NYSE: GNS) is a leading provider of AI-powered, digital-first education solutions, disrupting the highly standardized system of traditional education with a personalized, flexible and life-long learning curriculum for the modern student. Genius Group services 5.4 million users in over 200 countries, providing personalized curriculums for individuals, enterprises and governments. The comprehensive, AI-powered platform offers programs for K-12 education, accredited university courses and skills-based courses for entrepreneurs. To learn more, please visit https://www.geniusgroup.net/.

Investor Notice

Investing in our securities involves a high degree of risk. Before making an investment decision, you should carefully consider the risks, uncertainties and forward-looking statements described in our most recent Annual Report on Form 20-F for the fiscal year ended December 31, 2023, filed with the SEC on May 14, 2024. If any of these risks were to occur, our business, financial condition or results of operations would likely suffer. In that event, the value of our securities could decline, and you could lose part or all of your investment. The risks and uncertainties we describe are not the only ones facing us. Additional risks not presently known to us or that we currently deem immaterial may also impair our business operations. In addition, our past financial performance may not be a reliable indicator of future performance, and historical trends should not be used to anticipate results in the future. See "Forward-Looking Statements" below.

Forward-Looking Statements

Statements made in this press release include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements can be identified by the use of words such as “may,” “will,” “plan,” “should,” “expect,” “anticipate,” “estimate,” “continue,” or comparable terminology. Such forward-looking statements are inherently subject to certain risks, trends and uncertainties, many of which the Company cannot predict with accuracy and some of which the Company might not even anticipate and involve factors that may cause actual results to differ materially from those projected or suggested. Readers are cautioned not to place undue reliance on these forward-looking statements and are advised to consider the factors listed above together with the additional factors under the heading “Risk Factors” in the Company's Annual Reports on Form 20-F, as may be supplemented or amended by the Company's Reports of a Foreign Private Issuer on Form 6-K. The Company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events, new information or otherwise. 

Investor Relations Contact:
Brian M. Prenoveau, CFA
Managing Director
MZ Group - MZ North America
(561) 489-5315
GNS@mzgroup.us
www.mzgroup.us


FAQ

What is the 2023 pro forma revenue for Genius Group (GNS)?

The 2023 pro forma revenue for Genius Group (GNS) is $70.4 million, a 150% increase from 2022.

How much did Genius Group's gross profit increase in 2023?

Genius Group's gross profit increased to $11.9 million or 52% of revenue in 2023, up from $8.6 million or 47% in 2022.

What was Genius Group's net loss after tax for 2023?

Genius Group's net loss after tax for 2023 was $5.7 million, a significant reduction from $56.0 million in 2022.

How many students and users did Genius Group have in 2023?

Genius Group had 5.5 million students and users in 2023, a 24% increase from 2022.

What is the financial guidance for Genius Group (GNS) in 2024?

Genius Group (GNS) maintains a 2024 pro forma revenue guidance of at least $105 million.

What strategic moves did Genius Group make in 2023?

Genius Group completed the acquisition of FatBrain AI, launched the Genius City model in various global cities, and integrated AI tools and platforms.

How did Genius Group's operating expenses change in 2023?

Genius Group's operating expenses decreased slightly to $48.3 million in 2023, down from $51.1 million in 2022.

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