Kontrol Technologies Announces Q1 2021 Financial Results

TORONTO , May 31, 2021 /CNW/ - Kontrol Technologies Corp. (NEO: KNR) (OTCQB: KNRLF) (FSE: 1K8) (" Kontrol Technologies " or " Kontrol " or the " Company ") a leader in smart buildings and cities through IoT, Cloud and SaaS technology announces the release of its financial results for the three months ended March 31, 2021. A complete set of the Financial Statements and Management's Discussion & Analysis have been filed on SEDAR ( www.sedar.com ).

"Kontrol has continued to deliver positive operating cash flow and positive Adjusted EBITDA while investing in its operating platform and managing the market uncertainty caused by logistics and supply chain impacts from the COVID-19 pandemic," says Paul Ghezzi , CEO of Kontrol Technologies. "With our balance sheet improvement and recent equity raise we are well positioned to scale our patented smart building technologies. During the first quarter of 2021, the Company made significant progress in the commercialization and commencement of manufacturing of its BioCloud technology," continues Ghezzi.

Highlights

• Adjusted EBITDA* of $1.1 million in Q1 2021, up from $241,343 over the same quarter in the prior year
  
  
• Revenues of $3.3 million , up 20% over the same quarter in the prior year
  
  
• Cash flows from operating activities were $592,153 for the three months ended March 31, 2021 ; an improvement of $610,964 over the same quarter in the prior year
  
  
• The Company has invested approximately $4 million up to the end of Q1 in the development of BioCloud
  
  
• Conversions of convertible debentures to common shares totalled $631,000 during the first quarter of 2021
  
  
• Proceeds from options and warrants exercise were $710,607 during the first quarter of 2021
  
  
• Subsequent to Q1 2021, the Company announced on May 27, 2021 , an $8.5 million private placement with institutional investors; closing date expected to occur on or about June 1, 2021
  
  
• Capital management initiatives during the 2020 fiscal year and into 2021 have strengthened the balance sheet
  
  
• Manufactured hundreds of BioCloud units and closely managing the supply chain with manufacturing partners

Project Seasonality and the Impact of Covid-19 on Operations

Q1 is typically the quarter most impacted by seasonality and timing of projects. In Q1 approximately $500,000 in projects were impacted due to timing issues dealing with on-site restrictions during lockdown periods in Ontario. These projects will be delivered in Q3 and Q4.

The Company has been affected by ongoing global supply chain issues related to computer processors and other components that are required for BioCloud manufacturing. The impact has been primarily due to long lead times and scarcity of components. The Company is actively working with its supply chain partners to manage the supply chain.

There is no change to the Company's revenue and adjusted EBITDA targets previously presented on April 7, 2021 .

Q1 2021 Financial Summary

* Adjusted EBITDA is a non-IRFS financial measure. The Company defines Adjusted EBITDA as net income or loss before interest, income taxes, amortization, and depreciation, share based compensation, acquisition related expenses, and listing expense.

Conference Call Replay

A recording of the Q1 2021 financial results conference call held on May 31 st , 2021, is available here:

About Kontrol Technologies Corp.

Kontrol Technologies Corp., a Canadian public company, is a leader in smart buildings and cities through IoT, Cloud and SaaS technology. Kontrol Technologies provides a combination of software, hardware, and service solutions to its customers to improve energy management, air quality and continuous emission monitoring.

Additional information about Kontrol Technologies Corp. can be found on its website at www.kontrolcorp.com and by reviewing its profile on SEDAR at www.sedar.com

Neither IIROC nor any stock exchange or other securities regulatory authority accepts responsibility for the adequacy or accuracy of this release.

Non-IFRS Financial Measures

The Company defines Adjusted EBITDA as net income or loss before interest, income taxes, amortization, and depreciation, share based compensation, and acquisition related expenses. The Company believes Adjusted EBITDA is a useful measure as it provides information to management about the operating and financial performance of the Company and its ability to generate operating cash flow to fund future working capital needs, as well as future growth. Adjusted EBITDA may also be used by investors and analysts for the purpose of valuing the Company. Readers are cautioned that these non-IFRS definitions are not recognized measures under IFRS, do not have standardized meanings prescribed by IFRS, and should not be construed to be alternatives to net earnings determined in accordance with IFRS or as indicators of performance, liquidity, or cash flows.

Forward-Looking Statements

This news release contains "forward-looking information" within the meaning of applicable securities laws. All statements contained herein that are not clearly historical in nature may constitute forward-looking information. In some cases, forward-looking information can be identified by words or phrases such as "may", "will", "expect", "likely", "should", "would", "plan", "anticipate", "intend", "potential", "proposed", "estimate", "believe" or the negative of these terms, or other similar words, expressions, and grammatical variations thereof, or statements that certain events or conditions "may" or "will" happen, or by discussions of strategy.

Where the Company expresses or implies an expectation or belief as to future events or results, such expectation or belief is based on assumptions made in good faith and believed to have a reasonable basis. Such assumptions include, without limitation, that sufficient capital will be available to the Company and that technology will be as effective as anticipated.

However, forward-looking statements are subject to risks, uncertainties, and other factors, which could cause actual results to differ materially from future results expressed, projected, or implied by such forward-looking
statements. Such risks include, but are not limited to, that sufficient capital and financing cannot be obtained on reasonable terms, or at all, that technologies will not prove as effective as expected, that customers and potential customers will not be as accepting of the Company's product and service offering as expected, and government and regulatory factors impacting the energy conservation industry. Kontrol BioCloud is an air quality technology and not a medical device. The Company is not making any express or implied claims that its product has the ability to eliminate, cure or contain the COVID-19 (or SARS-2 Coronavirus).

Accordingly, undue reliance should not be placed on forward-looking statements and the forward-looking statements contained in this press release are expressly qualified in their entirety by this cautionary statement. The forward-looking statements contained herein are made as at the date hereof and are based on the beliefs, estimates, expectations, and opinions of management on such date. Kontrol does not undertake any obligation to update publicly or revise any such forward-looking statements or any forward-looking statements contained in any other documents whether as a result of new information, future events or otherwise or to explain any material difference between subsequent actual events and such forward-looking information, except as required under applicable securities law. Readers are cautioned to consider these and other factors, uncertainties, and potential events carefully and not to put undue reliance on forward-looking information.

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SOURCE Kontrol Technologies Corp.

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