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POSaBIT Reports First Quarter 2021 Financial Results

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POSaBIT Systems Corporation (CSE:PBIT, OTC:POSAF), a leading financial technology company delivering unique payment processing and point-of-sale (POS) systems for cash-only businesses with a focus on the cannabis industry, is pleased to report its financial results for the three months ended March 31, 2021.

POSaBIT announced its largest revenue quarter in company history and also achieved adjusted EBITDA profitability during the first quarter of 2021. Revenue grew by 276% and gross margin dollars grew 1,170% in Q1 2021 compared to Q1 2020. Revenue for the quarter increased to $3.55 million compared to $942 thousand in Q1 2020. Adjusted EBITDA profitability was $71 thousand for the quarter, representing its third consecutive positive adjusted EBITDA quarter.

Ryan Hamlin, CEO/co-founder of POSaBIT, commented, “2021 is off to a great start. Revenue has nearly quadrupled, operating margins expanded significantly, compared to Q1 of 2020, and we recorded our third consecutive positive adjusted EBITDA quarter. We expect rapid growth to continue in 2021 as we further build out a team, develop best in class technology, and expand our geographic footprint.”

First Quarter 2021 Financial Highlights

  • Transactional sales for POSaBIT’s card services business totaled $64 million, representing an increase of 308% compared with $15.7 million in the first quarter of 2020.
  • Total revenue was $3.55 million, up 276% compared with $942 thousand in the first quarter of 2020.
  • Gross profit was $890 thousand, or 25% of revenue, up 1,170% compared with a gross profit of $71 thousand, or 7.5% of revenue, in the first quarter of 2020.
  • Loss for the quarter was $514 thousand compared with a loss of $555 thousand in the first quarter of 2020.
  • Adjusted EBITDA was $71 thousand compared to an Adjusted EBITDA loss of $436 thousand in the first quarter of 2020.

Adjusted EBITDA is a non-IFRS measure used by management that does not have any prescribed meaning by IFRS and that may not be comparable to similar measures presented by other companies. The Company defines Adjusted EBITDA as net income or loss generated for the period as reported, before interest, taxes, depreciation and amortization, and is further adjusted to remove changes in fair values and expected credit losses, foreign exchange gains and/or losses, impairments. The Company believes this is a useful metric to evaluate its core operating performance.

Operational Highlights

  • On February 23, 2021, the Company completed a strategic investment private placement of units, receiving gross proceeds of $2 million USD.
  • On March 30, 2021, the Company announced a partnership with I Heart Jane, the premier online ordering and menu platform for marijuana retailers.

Subsequent Events

  • On April 21, 2021, the Company announced the appointment of Don Tringali to the Board of Directors. Mr. Tringali previously served as Chairman of the Board of Directors of two NASDAQ listed companies.
  • On May 13, 2021, the Company announced that Matt Fowler has been appointed Chief Financial Officer of POSaBIT USA.

2021 Outlook

  • POSaBIT provides the following revenue and gross margin guidance for the full year 2021.

 

 

FY 2021

2021 Total Revenue

 

$14.5M - $16M

Transaction sales for card services

 

$275M - $300M

Gross Profit Margin

 

28% - 32%

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22.89M
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