Technology

TERAGO Reports Fourth Quarter and Full Year 2023 Financial Results

Published

8 months ago

March 6, 2024

TORONTO, March 6, 2024 /CNW/ – TERAGO Inc. (“TERAGO” or the “Company”) (TSX: TGO), https://terago.ca/), today reported financial and operating results for the fourth quarter and fiscal year ended December 31, 2023.

“I am proud to report my second quarter since becoming CEO on June 12th, 2023. Our “Value Creation Strategy” accelerated delivery on behalf of customers, employees, shareholders – continued apace in the final quarter of 2023. In our prior earnings release I highlighted improvements across all of our key financial indicators. Today I am pleased to share that in the second half of 2023, we have continued the trend of strengthening these metrics.

Improvements in second half of 2023 as compared to the second half of 2022

Increased Adjusted EBITDA1,2 by 8%Improved positive cashflow from operations1 by 96%

In the second half of 2023, we delivered substantial financial wins that have afforded TERAGO the opportunity to reinvest in its transformation. This will drive a reenergizing of our top line. With new sales leadership in place and further growth investments anticipated, it is my intention to drive value as much from top line revenue growth as from cost optimization and careful management of our capital expenditures. TERAGO is extremely well positioned as a nimble, carrier-grade managed service provider of choice with differentiated frequencies, deep capabilities and a delivery track record in emerging growth areas. Smart, profitable growth will be a theme in 2024 and beyond,” said Daniel Vucinic, CEO.

Key Developments and Financial Highlights

Total revenues for the three months ended December 31, 2023, were $6.5 million compared to $6.3 million for the same period in 2022. Total annual revenue in 2023 was $26.1 million compared to $27.6 million in the prior year. The decrease of $1.5 million was the result of the prior year including one month of Cloud and Colocation and post transaction related support services (“Other Revenue”).Connectivity revenues were $6.5 million and $26.0 million, for the three months and year ended December 31, 2023, respectively. This is an increase of $0.2 million compared to same quarter prior year and $0.1 million compared to prior year annual.Adjusted EBITDA1,2, remained flat at $1.2 million for the three months ended December 31, 2023, compared to the same period in 2022. For the year ended December 31, 2023, Adjusted EBITDA1,2 decreased 17.1% to $3.4 million compared to $4.1 million for the same period in 2022. The decrease is the result of the prior year including one month of Cloud and Colocation Revenue ($1.4 million), partially offset by a reduction of overall operating expenses in the current year.Net loss increased to $3.6 million for the three months ended December 31, 2023, compared to a net loss of $2.4 million for the same period in 2022. Net loss was $13.2 million for the year ended December 31, 2023, compared to a net loss of $11.6 million for the same period in 2022. The increase in net loss was a combination of higher finance costs, lower total revenues, as described above combined with non-recurring costs associated with the staffing and management changes. These were partially offset by a reduction in overall operating expenses year over year.Gross Margin remained consistent year over year achieving 73.3% in 2023 compared to 73.1% in the prior year.Backlog MRR1 decreased year over year to $65,363 as of December 31, 2023, from $178,948 for the same period in 2022. The decrease in backlog MRR is the result of onboarding of new customers with improved installation processes yielding much faster installations which reduced the backlog due to installations exceeding new bookings in the year and combined with de-bookings of previously recorded orders due to technical, geographical and customer landlord limitations preventing fulfillment of the orders.ARPU1 for the connectivity business was $1,164 in Q4 2023 up from $1,127 in Q3 2023 and compared to $1,063 for the same period in 2022 due to changes in customer base and product mix and a new pricing strategy implemented in 2023 Q4. ARPU has been increasing every quarter for the past five quarters.

_________________________________________

(1)

See ” Non-IFRS Measures”

(2)

See “Adjusted EBITDA” for a reconciliation of net loss to Adjusted EBITDA.

Additional Management Commentary

“The Value Creation Strategy has gained sufficient traction and is already yielding tangible benefits. I expect that TERAGO’s efforts will be further buoyed by the addition of a permanent Chief Financial Officer, following the departure of the previous CFO due to personal family reasons after a brief tenure. A search is well underway for a permanent Chief Financial Officer, and I look forward to reacquainting the investor community with TERAGO and the Value Creation Strategy in the second half of 2024 following the integration of this key member of our team.

“In addition, we noted with great interest the consultation launched by Innovation, Science and Economic Development Canada with respect to license renewals impacting our 38 GHz and 24GHz bands, as well as the preliminary consultation launched on changes to our 24 GHz band. Like any wireless business, spectrum is our lifeblood. Reasonable long-term visibility and our ability to put our spectrum to work in a way that fosters a growing, competitive and knowledge-based economy is absolutely critical for us to be able to invest in our diverse and innovative service offerings. We remain fully engaged in this important process.”, said Daniel Vucinic.

RESULTS OF OPERATIONS

Comparison of the three months and year ended December 31, 2023 and 2022
(In thousands of dollars, except with respect to gross profit margin, earnings per share, Backlog MRR, and ARPU)

(unaudited)

Three months ended
December 31

Year ended
December 31

2023

2022

2023

2022

Financial

Cloud and Colocation Revenue

–

1,355

Connectivity Revenue

6,536

6,285

26,034

25,860

Other Revenue

–

407

Total Revenue

6,536

6,335

26,052

27,622

Cost of Services1

1,801

1,578

6,948

7,437

Selling, General, & Administrative Costs

4,577

3,980

18,430

19,188

Gross Profit Margin1

72.4 %

75.1 %

73.3 %

73.1 %

Adjusted EBITDA 1,2

1,190

1,164

3,435

4,077

Net Loss

(3,561)

(2,406)

(13,185)

(11,571)

Basic loss per share

(0.18)

(0.12)

(0.67)

(0.61)

Diluted loss per share

(0.18)

(0.12)

(0.67)

(0.61)

Operating

Backlog MRR1

Connectivity

65,363

178,948

65,363

178,948

Churn Rate1

Connectivity

1.0 %

0.9 %

1.1 %

0.8 %

ARPU1

Connectivity

1,164

1,063

1,125

1,085

(1)

See ” Non-IFRS Measures”

(2)

See “Adjusted EBITDA” for a reconciliation of net loss to Adjusted EBITDA.

Conference Call

Management will host a conference call on Thursday, March 7, 2024, at 10:00 AM ET to discuss these results.

To access the conference call, please dial 888-506-0062 or 973-528-0011 and use conference ID 572559 if applicable. Please call the conference telephone number 15 minutes prior to the start time so that you are in the queue for an operator to assist in registering and patching you through.

An archived recording of the conference call will be available through Thursday, March 21, 2024. To listen to the recording, call 877-481-4010 or 919-882-2331 and enter passcode 50012# if applicable.

(1) Non-IFRS Measures

This press release contains references to “Cost of Services”, “Gross Profit Margin”, “Adjusted EBITDA”, “Backlog MRR”, “ARPU”, and “churn” which are not measures prescribed by International Financial Reporting Standards (IFRS).

Cost of Services consists of expenses related to delivering service to customers and servicing the operations of our networks. These expenses include costs for the lease of intercity facilities to connect our cities, internet transit and peering costs paid to other carriers, network real estate lease expense, spectrum lease expenses and lease and utility expenses for the data centres and salaries and related costs of staff directly associated with the cost of services.

Gross Profit Margin % consists of gross profit margin divided by revenue where gross profit margin is revenue less cost of services.

Adjusted EBITDA – The Company believes that Adjusted EBITDA is useful additional information to management, the Board and investors as it provides an indication of the operational results generated by its business activities prior to taking into consideration how those activities are financed and taxed and also prior to taking into consideration asset depreciation and amortization and it excludes items that could affect the comparability of our operational results and could potentially alter the trends analysis in business performance. Excluding these items does not necessarily imply they are non-recurring, infrequent or unusual. Adjusted EBITDA is also used by some investors and analysts for the purpose of valuing a company. The Company calculates Adjusted EBITDA as earnings before deducting interest, taxes, depreciation and amortization, foreign exchange gain or loss, finance costs, finance income, gain or loss on disposal of network assets, property and equipment, impairment of property, plant, & equipment and intangible assets, stock-based compensation and restructuring, acquisition-related and integration costs. Investors are cautioned that Adjusted EBITDA should not be construed as an alternative to operating earnings (losses), or net earnings (losses) determined in accordance with IFRS as an indicator of our financial performance or as a measure of our liquidity and cash flows. Adjusted EBITDA does not take into account the impact of working capital changes, capital expenditures, debt principal reductions and other sources and uses of cash, which are disclosed in the consolidated statements of cash flows.

A reconciliation of net loss to Adjusted EBITDA is found below and in the MD&A for the three months and year ended December 31, 2023. Adjusted EBITDA does not have any standardized meaning under IFRS/GAAP. TERAGO’s method of calculating Adjusted EBITDA may differ from other issuers and, accordingly, Adjusted EBITDA may not be comparable to similar measures presented by other issuers.

The table below reconciles net loss to Adjusted EBITDA for the three months and year ended December 31 2023 and 2022.

(in thousands of dollars, unaudited)

Three months ended
December 31

Year ended
December 31

2023

2022

2023

2022

Net loss for the period

(3,561)

(2,406)

(13,185)

(11,571)

Foreign exchange loss

Finance costs

1,154

491

3,707

2,089

Finance income

(35)

(38)

(209)

(123)

Impairment loss on divested assets

–

107

Loss from operations

(2,418)

(1,908)

(9,680)

(9,415)

Add/(deduct):

Depreciation of network assets, property and equipment
and amortization of intangible assets

2,474

2,529

9,974

10,085

Loss on disposal of network assets

–

171

Impairment of other assets and related charges

147

297

750

Stock-based compensation expense

227

115

590

688

Restructuring, acquisition-related, integration and other
related costs

804

281

2,171

1,798

Adjusted EBITDA1

1,190

1,164

3,435

4,077

*Prior year figures have been adjusted to conform with current year presentation.

Backlog MRR – The term “Backlog MRR” is a measure of contracted monthly recurring revenue (MRR) from customers that have not yet been provisioned. The Company believes backlog MRR is useful additional information as it provides an indication of future revenue. Backlog MRR is not a recognized measure under IFRS and may not translate into future revenue, and accordingly, investors are cautioned in using it. The Company calculates backlog MRR by summing the MRR of new customer contracts and upgrades that are signed but not yet provisioned, as at the end of the period. TERAGO’s method of calculating backlog MRR may differ from other issuers and, accordingly, backlog MRR may not be comparable to similar measures presented by other issuers.

ARPU – The term “ARPU” refers to the Company’s average revenue per customer per month in the period. The Company believes that ARPU is useful supplemental information as it provides an indication of our revenue from an individual customer on a per month basis. ARPU is not a recognized measure under IFRS and, accordingly, investors are cautioned that ARPU should not be construed as an alternative to revenue determined in accordance with IFRS as an indicator of our financial performance. The Company calculates ARPU by dividing our total revenue before revenue from early terminations by the number of customers in service during the period and we express ARPU as a rate per month. TERAGO’s method of calculating ARPU has changed from the Company’s past disclosures to exclude revenue from early termination fees, where ARPU was previously calculated as revenue divided by the number of customers in service during the period. TERAGO’s method may differ from other issuers, and accordingly, ARPU may not be comparable to similar measures presented by other issuers.

Churn – The term “churn” or “churn rate” is a measure, expressed as a percentage, of customer cancellations in a particular month. The Company calculates churn by dividing the number of customer cancellations during a month by the total number of customers at the end of the month before cancellations. The information is presented as the average monthly churn rate during the period. The Company believes that the churn rate is useful supplemental information as it provides an indication of future revenue decline and is a measure of how well the business is able to renew and keep existing customers on their existing service offerings. Churn and churn rate are not recognized measures under IFRS and, accordingly, investors are cautioned in using it. TERAGO’s method of calculating churn and churn rate may differ from other issuers and, accordingly, churn may not be comparable to similar measures presented by other issuers.

Cash from Operations – The term “Cash from Operations” refers to the “Cash from Operating Activities” as shown on the “Consolidated Statement of Cash Flows” in the Company’s Consolidated Financial Statements.

Overall Cash Consumption – The term “Overall Cash Consumption” refers to the “Net change in cash and cash equivalents during the period” as shown on the “Consolidated Statement of Cash Flows” in the Company’s Consolidated Financial Statements.

About TERAGO
TERAGO provides managed wireless and wireline connectivity and private 5G wireless networking services to businesses operating across Canada. As Canada’s biggest mmWave spectrum holders, the Company possesses exclusive spectrum licenses in the 24 GHz and 38 GHz spectrum bands, which it utilizes to provide secure, dedicated SLA guaranteed enterprise grade performance that is technology diverse from buried cables ensuring high availability connectivity services. TERAGO serves over 1,900 Canadian and Global businesses operating in major markets across Canada, including Toronto, Montreal, Calgary, Edmonton, Vancouver, Ottawa and Winnipeg, and has been providing wireless services since 1999. For more information about TERAGO, please visit www.terago.ca.

Forward-Looking Statements
This news release includes certain forward-looking statements. By their nature, forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond TERAGO’s control. Forward-looking statements may include but are not limited to statements regarding the further developing our 5G Fixed Wireless Access program, consistently executing across all fronts of the business, success in providing Canadian enterprises with managed services and the 5G fixed wireless trials being conducted by the Company. All such statements constitute “forward-looking information” as defined under, applicable Canadian securities laws. Any statements contained herein that are not statements of historical facts constitute forward-looking information. The forward-looking statements reflect the Company’s views with respect to future events and is subject to risks, uncertainties and assumptions, including those risks set forth in the “Risk Factors” sections in the annual MD&A of the Company for the year ended December 31, 2023 available on www.sedar.com under the Company’s corporate profile. Factors that could cause actual results or events to differ materially include the inability to consistently achieve sales growth across all lines of TERAGO’s business including managed services, inability to complete successful 5G technical trials, the impacts and restrictions caused by the COVID-19 pandemic are prolonged which may further delay customer trials and/or cause a negative impact on future financial results of the Company, TERAGO’s Pandemic Response Plan may not mitigate all impacts of COVID-19, the results of the 5G trials not being satisfactory to TERAGO or any of its technology partners, regulatory requirements may delay or inhibit the trial, the economic viability of any potential services that may result from the trial, the ability for TERAGO to further finance and support any new market opportunities that may present itself, and industry competitors who may have superior technology or are quicker to take advantage of 5G technology. Accordingly, readers should not place undue reliance on forward-looking statements as several factors could cause actual future results, conditions, actions or events to differ materially from the targets, expectations, estimates or intentions expressed with the forward-looking statements. Except as may be required by applicable Canadian securities laws, TERAGO does not intend, and disclaims any obligation, to update or revise any forward-looking statements whether in words, oral or written as a result of new information, future events or otherwise.

SOURCE TeraGo Inc.

Technology

NASA Johnson Invites Proposals to Lease Vibration Test Facility

Published

3 minutes ago

November 14, 2024

HOUSTON, Nov. 14, 2024 /PRNewswire/ — NASA’s Johnson Space Center is seeking proposals for the use of its historic, but underused, Vibration and Acoustic Test Facility. Prospective tenants must submit facility walk-through requests by Monday, Nov. 18.

Final proposals are due by 12 p.m. EST Monday, Dec. 16, and must promote activities that will build, expand, modernize, or operate aerospace-related capabilities at NASA Johnson and help preserve the historic and iconic building through preservation and adaptive reuse.

NASA plans to sign a National Historic Preservation Act (NHPA) lease agreement for the facility, also known as Building 49, for a five-year base period and one five-year extension to be negotiated between NASA and the tenant. To request a walk-through, send an email to hq-realestate@mail.nasa.gov.

“This historic facility has been used for decades to ensure the success and safety of all human spaceflight missions by putting engineering designs and hardware to the ultimate stress tests,” said NASA Johnson Director Vanessa Wyche. “For more than 60 years, NASA Johnson has been the hub of human space exploration and this agreement will be a vital part of the center’s efforts to develop a robust and durable space economy that refines our understanding of the solar system and space exploration.”

All proposals must adhere to the guidelines detailed in the Agency Announcement for Proposals describing concept plans for development of the property, including any modifications proposed to the building; a statement of financial capability to successfully achieve and sustain operations, demonstrated experience with aerospace-related services or other space-related activities, and a detailed approach to propelling the space economy.

The nine-story building complex has a gross square footage of 62,737 square feet and consists of a north wing measuring 62 feet long, 268 feet wide and 106 feet tall, and a central wing about 64 feet long and 115 feet wide. Building 49 currently houses five laboratories, including the General Vibration Laboratory, Modal Operations Laboratory, Sonic Fatigue Laboratory, Spacecraft Acoustic Laboratory, and Spacecraft Vibration Laboratory. The south administrative portion of the building is not included in the property offered for lease.

As the home of Mission Control Center for the agency’s human space missions, astronaut training, robotics, human health and space medicine, NASA Johnson leads the way for the human exploration. Leveraging its unique role and location, the center is developing multiple lease agreements, including the recently announced Exploration Park, to sustain its key role in helping the human spaceflight community foster a robust space.

In the coming years, NASA and its academic, commercial, and international partners will see the completion of the International Space Station Program, the commercial development of low Earth orbit, and the first human Artemis campaign missions establishing sustainable human presence on the Moon in preparation for human missions to Mars.

Johnson already is leading the commercialization of space with the commercial cargo and crew programs and private astronaut missions to the space station. The center also is supporting the development of commercial space stations in low Earth orbit, and lunar-capable commercial spacesuits and lunar landers that will be provided as services to both NASA and the private sector to accelerate human access to space. Through the development of Exploration Park, the center will broaden the scope of the human spaceflight community that is tackling the many difficult challenges ahead.

Learn more about NASA Johnson’s efforts to collaborate with industry partners:

https://www.nasa.gov/johnson/frontdoor/

NASA Johnson Space Center news releases and other information are available automatically by sending an Internet electronic mail message to listserv@listserver.jsc.nasa.gov. In the body of the message (not the subject line) users should type “subscribe hsfnews” (no quotes). This will add the email address that sent the subscribe message to the news release distribution list. The system will reply with a confirmation via E-mail of each subscription. Once you have subscribed you will receive future news releases via e-mail.

View original content to download multimedia:https://www.prnewswire.com/news-releases/nasa-johnson-invites-proposals-to-lease-vibration-test-facility-302306403.html

SOURCE NASA

Technology

Cabana Partners with Virginia Department of Veterans Services to Provide Comprehensive, Free Mental Health Support for Veterans, Guard/Reserve Members, and Their Families

Published

3 minutes ago

November 14, 2024

RICHMOND, Va., Nov. 14, 2024 /PRNewswire/ — Cabana, a modern mental health provider offering confidential, tech-enabled support, has partnered with the Virginia Department of Veterans Services (DVS) to provide free, comprehensive mental health resources to Virginia’s veterans, Guard and Reserve members, as well as their spouses and caregivers. This collaboration expands access to Cabana’s digital mental health services, including live peer support groups moderated by Virginia-certified Veteran Peer Specialists.

Originally developed through research and development initiatives with the U.S. Air Force, Cabana’s services are designed to meet the unique needs of military and veteran communities. With this partnership, eligible Virginia users gain full access to Cabana’s digital suite, which includes the full range of virtual, professionally facilitated groups offered by Cabana, as well as dedicated Virginia Veteran peer-led support groups. Participants can connect discreetly on topics such as transitioning to civilian life, managing family relationships, and coping with stress, all within a secure and confidential environment accessible from any device.

David Black, Founder and CEO of Cabana, underscored the mission behind the partnership: “We’re honored to work with the Virginia Department of Veterans Services to offer a holistic mental health solution for Virginia’s military-connected community. With Virginia-certified Veteran Peer Specialists and our full array of live support groups, we’re providing a powerful, confidential resource that veterans and military families can rely on, whenever and wherever they need it.”

Key Features of the Partnership:

Comprehensive Access to Support: Virginia veterans, Guard/Reserve members, and their families will have unrestricted access to all live virtual groups available through Cabana, in addition to specialized peer-led groups run by Virginia-certified Veteran Peer Specialists.Support for Families and Caregivers: The initiative includes spouses and caregivers, addressing the unique mental health needs of military-connected families through sessions tailored to issues like family dynamics, stress management, and the transition to civilian life.Confidential and Flexible Access: Cabana’s services are available on mobile and desktop devices, providing Virginia’s veterans and their families with an easily accessible, cost-free solution for mental health support.

This collaboration highlights Cabana’s commitment to supporting the mental well-being of those who serve and their families. By joining forces with the Virginia Department of Veterans Services, Cabana seeks to strengthen the resilience and wellness of Virginia’s military community.

For more information on the partnership between Cabana and the Virginia Department of Veterans Services, please contact:

Nick Armstrong, Ph.D.
Head of Public Sector, Cabana
nick@cabanahealth.org

About Cabana™
Cabana is a leading, modern mental health provider offering confidential, tech-enabled support solutions tailored to the needs of diverse communities. Through live, professionally moderated group sessions, evidence-based content, and adaptable wellness tools, Cabana helps individuals proactively manage their mental health. Our mission is clear: to make mental health care more accessible through technology and human connection.

About the Virginia Department of Veterans Services (DVS)

The Virginia Department of Veterans Services (DVS) is a state government agency with more than 50 locations across the Commonwealth of Virginia. DVS traces its history to 1928 and the establishment of the Virginia War Service Bureau to assist Virginia’s World War I veterans. Today, DVS assists veterans and their families in filing claims for federal veterans benefits; provides veterans and family members with linkages to services including behavioral health, housing, employment, education, and other programs. The agency operates long-term care facilities offering in-patient skilled nursing care, dementia/memory care, and short-term rehabilitation for veterans; and provides an honored final resting place for veterans and their families at three state veterans cemeteries. It operates the Virginia War Memorial, the Commonwealth’s tribute to Virginia’s men and women who gave the ultimate sacrifice from World War II to the present. For more information, please visit www.dvs.virginia.gov.

View original content to download multimedia:https://www.prnewswire.com/news-releases/cabana-partners-with-virginia-department-of-veterans-services-to-provide-comprehensive-free-mental-health-support-for-veterans-guardreserve-members-and-their-families-302306404.html

SOURCE Cabana

Technology

East Side Games Group Reports Third Quarter 2024 Financial Results

Published

3 minutes ago

November 14, 2024

Revenue of $21.4M in Q3 2024 and $62.8M Year to DateA-EBITDA of $2.56M in Q3 2024 and $9.2M Year to DatePOWER RANGERS: MIGHTY FORCE launched globally

VANCOUVER, BC, Nov. 14, 2024 /CNW/ – East Side Games Group (TSX: EAGR) (OTC: EAGRF) (“ESGG” or the “Company”), is pleased to announce its financial results for the third quarter ended September 30, 2024. All amounts are stated in Canadian dollars on an IFRS basis unless otherwise indicated. Building on the momentum from Q2, the company achieved its first growth quarter of the year, reporting a top-line revenue of $21.4 million, a 4% increase quarter-over-quarter and a 3% increase year-over-year.

The company’s adjusted EBITDA for the quarter was $2.56 million, representing a 12% margin and marking the eighth consecutive profitable quarter above $2.5 million. East Side Games Group continues to demonstrate strong performance metrics across its core portfolio, with an average daily user count (DAU) of 236,000, a stickiness rate of 24%, and an average revenue per daily active user (ARPDAU) of $0.99.

“Our focus on profitability within our existing portfolio has paid off, and we are excited to further enhance our user acquisition strategies,” said Jason Bailey, CEO of East Side Games Group. “With $8.3 million in cash—our highest balance since Q2 2022—we are well-positioned to invest in our future game launches and bolster our share buyback program.”

One of the key drivers of growth this quarter was the launch of POWER RANGERS: MIGHTY FORCE in August, which quickly garnered nearly 30,000 daily active users and demonstrated impressive return on advertising spend (ROAS) figures.

In Q3, the company also enhanced its revenue generation through innovative strategies. The introduction of bi-monthly season passes for popular titles like Trailer Park Boys: Greasy Money and Cheech and Chong: Bud Farm resulted in a remarkable 40% increase in season pass revenue.

In a major collaboration, East Side Games Group partnered with BBC and Paramount to create the Intergalactic Friendship Day crossover event between Star Trek Lower Decks: The Badgey Directive and Doctor Who: Lost in Time, generating substantial organic traffic and setting new ARPDAU records.

Looking forward to Q4, East Side Games Group is excited to introduce team-based cooperative and competitive play features into titles such as Trailer Park Boys: Greasy Money and RuPaul’s Drag Race Superstar , anticipating a significant boost in player engagement and monetization.

Moreover, the company is preparing to launch Trailer Park Boys: Greasy Money on the Epic Games Store, expanding its reach in a new mobile marketplace with favorable revenue-sharing terms. This is a very exciting opportunity, only being afforded to a few game studios.

Finally, East Side Games Group is thrilled to announce our upcoming title, RuPaul’s Drag Race Match Queen, developed in partnership with Funkitron and World of Wonder. Slated for a 2025 release, this hybrid match-3 game combines beloved gameplay elements with captivating fashion and character features, catering to the passionate fanbase of RuPaul’s Drag Race.

Mike Edwards will be stepping down from the ESGG Board of Directors to focus on other pursuits, effective immediately. ESGG thanks him for his invaluable guidance over the past 12 years and is currently in discussions with several highly qualified candidates for his replacement.

Three Months Ended Sep 30, 2024 Financial highlights

For the quarter ended September 30th, 2024, revenue was $21.4M.Q3 2024 a-EBITDA of $2.56M and 12% a-EBITDA margin.Cashflow for the Company for the quarter ended September 30, 2024 increased by $700k, ending at $8.3M.Daily Active Users in Q3 were 236k, with an ARPDAU of $0.99On November 14, 2023, the Company announced a renewal of its Normal Course Issuer Bid (“NCIB”) authorizing the Company to purchase 4,076,819 of its shares. Through September 30, 2024, the Company purchased 1,540,719 shares at an average price of $0.76. The company continues to buy back stock as restrictions allow.

Certain information provided in this news release is extracted from the consolidated financial statements (the “Financial Statements”) and Management’s Discussion & Analysis (“MD&A”) of the Company for the quarter ended September 30, 2024, and should be read in conjunction with them. It is only in the context of the fulsome information and disclosures contained in the Financial Statements and MD&A that an investor can properly analyze this information. The Financial Statements and MD&A can be found under the Company’s profile on SEDAR and EDGAR.

Earnings Call Video

ESGG will release its third-quarter 2024 financial results and business outlook on its investor relations website https://eastsidegamesgroup.com/investors/financial-information on Thursday, November 14th, 2024, at approximately 2:00 p.m. Pacific Time.

ABOUT EAST SIDE GAMES GROUP

East Side Games Group is a leading free-to-play mobile game group, creating engaging games that produce enduring player loyalty. Our studio groups entrepreneurial culture is anchored in creativity, execution, and growth through licensing of our proprietary Game Kit software platform that enables professional game developers to greatly increase the efficiency and effectiveness of game creation in addition to organic growth through a diverse portfolio of original and licensed IP mobile games that include: The Office: Somehow We Manage, Star Trek: Lower Decks – The Badgey Directive, Bud Farm Idle Tycoon, Doctor Who: Lost in Time, RuPaul’s Drag Race Superstar, AEW: Rise to The Top, Cheech and Chong Bud Farm, and Trailer Park Boys: Grea$y Money.

We are headquartered in Vancouver, Canada and our games are available worldwide on the App Store and Google Play. Additional information about the Company continues to be available under its legal name, East Side Games Group Inc., at www.sedar.com.

Forward-looking Information

Certain statements in this release are forward-looking statements, which reflect the expectations of management regarding the proposed transactions described herein. Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations or intentions regarding the future. Such statements are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the statements. No assurance can be given that any of the events anticipated by the forward-looking statements will occur or, if they do occur, what benefits the Company will obtain from them. These forward-looking statements reflect management’s current views and are based on certain expectations, estimates and assumptions which may prove to be incorrect. A number of risks and uncertainties could cause our actual results to differ materially from those expressed or implied by the forward-looking statements, including factors beyond the Company’s control. These forward-looking statements are made as of the date of this news release.

SOURCE East Side Games Group Inc.