Conference Call Scheduled for May 24, 2024 at 11am EST
Vancouver, B.C., Canada – May 23, 2024 – Legend Power Systems Inc. (TSX.V: LPS) (OTCQB: LPSIF) (“Legend Power” or the “Company”), a global leader in commercial electrical system solutions, reports its financial results for the three months ended March 31, 2024 (“Q2 F2024”). The Company has also scheduled a conference call to provide a business update to discuss its Q2 F2024 financial results tomorrow at 11:00 AM ET (8:00 AM PT) (details below). The call will be hosted by Randy Buchamer, President & Chief Executive Officer. A complete set of Financial Statements and Management’s Discussion & Analysis has been filed at www.sedarplus.ca. All dollar figures are quoted in Canadian dollars.
Q2 F2024 Highlights
- Revenue of $124 thousand versus $74 thousand in Q2 F2023
- Adjusted EBITDA loss of $811 thousand versus a $1.04 million loss in Q2 F2023
- Net loss of $907 thousand versus a $1.19 million loss in Q2 F2023
- Cash of $515 thousand, no debt, and $1.9 million in working capital at March 31, 2024
- Subsequent to quarter end, received over $750 thousand in deposits on signed sales orders
“We are very excited to have closed on some large deals this quarter, including a double-digit landmark deal with a prominent commercial real estate owner/operator,” said Randy Buchamer, Legend Power Systems CEO. “As we work to close additional deals, our pipeline continues to grow. We continue to manage our cash carefully and expect that with deposits and working capital we are funded into fiscal 2025. that will help with working capital going forward. I look forward to being able to update investors as additional deals are finalized in the coming quarters.”
Q2 F2024 Operational Highlights
- The first unit shipped to the US Federal Government, to the Department of Homeland Security, and is expected to be installed in the next couple months. The Green Proving Ground program for the United States General Services Administration, which operates approximately 1,800 federally owned buildings is proceeding well. A second unit will be commissioned and shipped in the coming months. The Company continues to build upon key milestones achieved in the prior year, the deployment and evaluation schedule continues to progress.
- Progress continues with the City of New York’s Department of Citywide Administrative Services (DCAS) IDEA program. The City of New York has closed its first round of bids for school projects, which includes the SmartGATE solution in the specification and the award is expected to result in bookings in the near future.
- The pipeline remains very strong with opportunities into government and commercial real estate including residential, hospitality, big box retail and commercial office. Currently Legend Power Systems is engaged in active sales processes with several of the top firms in the Commercial Real Estate space, with large building portfolios.
Q2 F2024 Financial Highlights
Financial summary for the three and six months ended March 31, 2024 and 2023
| Three months ended March 31, | Six months ended March 31, | |||||
| (Cdn$, unless noted otherwise) | 2024 | 2023 | Change | 2024 | 2023 | Change |
| Revenue | 123,678 | 74,006 | 67% | 125,226 | 476,669 | (74)% |
| Cost of sales | 66,907 | 78,865 | (15)% | 89,571 | 380,817 | (76)% |
| Gross margin1 | 56,771 | (4,859) | 35,655 | 95,852 | ||
| Gross margin %1 | 46% | (7)% | 28% | 20% | ||
| Operating expenses | 968,239 | 1,188,409 | (19)% | 2,037,827 | 2,301,405 | (11)% |
| Other income (expense) | 4,310 | 5,177 | (17)% | 13,524 | 11,948 | 13% |
| Net loss | (907,158) | (1,188,091) | (24)% | (1,988,648) | (2,193,605) | (9)% |
| Adjusted EBITDA2 | (811,146) | (1,035,944) | (22)% | (1,782,819) | (1,885,520) | (5)% |
1 Gross margin is based on a blend of both equipment and installation revenue.
2 Adjusted EBITDA is a non-IFRS financial measure. See EBITDA Reconciliation for details.
Revenue for the three months ended March 31, 2024, was $123,678 compared with $74,006 in the same quarter of fiscal 2023. The increase in revenue during Q2 of fiscal 2024 was primarily due to an increase in the number of SmartGATE units delivered during the period.
Gross margin in the second quarter of fiscal 2024 was $56,771, compared with negative $4,859 in same quarter of fiscal 2023. Negative margins in Q2 of fiscal 2023 was due to inventory count adjustments, as well as additional costs incurred to replace and repair a unit damaged, which the Company is recovering from the service provider against future services.
The Company’s operating expenses for the second quarter of fiscal 2024 were $986,239, down from $1,188,409 in the same quarter of fiscal 2023. The primary cause for the decrease was lower salaries and consulting costs as a result of internal cost cutting measures.
Adjusted EBITDA for the second quarter of fiscal 2024 was negative $811,146, compared with negative $1,035,944 in same quarter of fiscal 2023.
Net loss for the second quarter of fiscal 2024 was $907,158, compared with a net loss of $1,188,091 in the same quarter of fiscal 2023. Increase in gross margins and decreased operating costs in Q2 of fiscal 2024 compared with the same quarter of fiscal 2023 resulted in a lower net loss.
CONFERENCE CALL DETAILS:
DATE: Friday, May 24, 2024
TIME: 11:00 AM ET (8:00 AM PT)
WEBINAR: Legend Power Q2 Fiscal 2024 Financial Results Investor Webinar (via Zoom)
REPLAY: Available at: https://legendpower.com
About Legend Power Systems Inc.
Legend Power Systems Inc. (https://legendpower.com/) provides an intelligent energy management platform that analyzes and improves building energy challenges, significantly impacting asset management and corporate performance. Legend Power’s proven solutions support proactive executive decision-making in a complex and volatile business and energy environment. The proprietary and patented system reduces total energy consumption and power costs, while also maximizing the life of electrical equipment. Legend Power’s unique solution is also a key contributor to both corporate sustainability efforts and the meeting of utility energy efficiency targets.
For further information, please contact:
Jonathan Lansky, Director
+1 416 417 7664
lansky.j@icloud.com
Sean Peasgood, Investor Relations
+ 1 647 503 1054
sean@sophiccapital.com
Neither the TSX Venture Exchange nor the Investment Industry Regulatory Organization of Canada accepts responsibility for the adequacy or accuracy of this release.
Forward-Looking Statements
This Press Release may contain statements which constitute “forward-looking information”, including statements regarding the plans, intentions, beliefs and current expectations of the Company, its directors, or its officers with respect to the future business activities and operating performance of the Company. The words “may”, “would”, “could”, “will”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “expect” and similar expressions, as they relate to the Company, or its management, are intended to identify such forward-looking statements. Investors are cautioned that any such forward-looking statements are not guarantees of future business activities or performance and involve risks and uncertainties, and that the Company’s future business activities may differ materially from those in the forward-looking statements as a result of various factors. Such risks, uncertainties and factors are described in the periodic filings with the Canadian securities regulatory authorities, including the Company’s quarterly and annual Management’s Discussion & Analysis, which may be viewed on SEDAR+ at www.sedarplus.ca. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although the Company has attempted to identify important risks, uncertainties and factors which could cause actual results to differ materially, there may be others that cause results to not be as anticipated, estimated or intended. The Company does not intend, and does not assume any obligation, to update these forward-looking statements other than as may be required by applicable law.