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Guardforce AI Reports Positive Adjusted Net Income for the First Half of 2024

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Guardforce AI Co., (NASDAQ: GFAI) reported positive financial results for the first half of 2024. Gross profit increased by 50% compared to H1 2023, with gross profit margin rising to 18.4%. The company achieved an adjusted net income of $0.1 million, a significant improvement from the $1.8 million loss in H1 2023. Operating loss decreased by 82.5% to $2.1 million.

Key business highlights include expanding services to over 25,000 retail stores, securing long-term contracts, and developing GFAI Agents as the core technology for AI Purchase and AI Travel Solutions. The company also diversified its Robot-as-a-Service (RaaS) offerings, launching new products like LinguaBot and RoboTravel Agent.

Despite a slight 2.4% decrease in net revenue due to currency exchange rates, Guardforce AI's secured logistics business grew by 5.2%. The company ended H1 2024 with $15.5 million in cash and cash equivalents.

Guardforce AI Co., (NASDAQ: GFAI) ha riportato risultati finanziari positivi per il primo semestre del 2024. Il profitto lordo è aumentato del 50% rispetto al primo semestre del 2023, con un margine di profitto lordo che è salito al 18,4%. L'azienda ha ottenuto un reddito netto rettificato di $0,1 milioni, un notevole miglioramento rispetto alla perdita di $1,8 milioni nel primo semestre del 2023. La perdita operativa è diminuita dell'82,5%, arrivando a $2,1 milioni.

I principali punti salienti dell'attività includono l'espansione dei servizi a oltre 25.000 negozi al dettaglio, l'acquisizione di contratti a lungo termine e lo sviluppo di GFAI Agents come tecnologia fondamentale per le Soluzioni AI per Acquisti e Viaggi. L'azienda ha anche diversificato le sue offerte di Robot-as-a-Service (RaaS), lanciando nuovi prodotti come LinguaBot e RoboTravel Agent.

Nonostante un leggero calo del 2,4% nel fatturato netto a causa dei tassi di cambio, l'attività di logistica garantita di Guardforce AI è cresciuta del 5,2%. L'azienda ha chiuso il primo semestre del 2024 con $15,5 milioni in contante e equivalenti di contante.

Guardforce AI Co., (NASDAQ: GFAI) reportó resultados financieros positivos para la primera mitad de 2024. El beneficio bruto aumentó un 50% en comparación con la primera mitad de 2023, con un margen de beneficio bruto que subió al 18.4%. La compañía logró un ingreso neto ajustado de $0.1 millones, una mejora significativa respecto a la pérdida de $1.8 millones de la primera mitad de 2023. La pérdida operativa disminuyó un 82.5%, alcanzando los $2.1 millones.

Los aspectos destacados del negocio incluyen la expansión de servicios a más de 25,000 tiendas minoristas, la obtención de contratos a largo plazo y el desarrollo de GFAI Agents como la tecnología central para soluciones de compras y viajes con IA. La empresa también diversificó sus ofertas de Robot-as-a-Service (RaaS), lanzando nuevos productos como LinguaBot y RoboTravel Agent.

A pesar de una ligera disminución del 2.4% en los ingresos netos debido a las tasas de cambio, el negocio de logística asegurada de Guardforce AI creció un 5.2%. La empresa finalizó la primera mitad de 2024 con $15.5 millones en efectivo y equivalentes de efectivo.

Guardforce AI Co., (NASDAQ: GFAI)는 2024년 상반기 긍정적인 재무 결과를 보고했습니다. 총 이익이 50% 증가했습니다, 2023년 상반기와 비교하여 총 이익률은 18.4%로 상승했습니다. 이 회사는 조정된 순이익이 10만 달러에 달했으며, 이는 2023년 상반기에 180만 달러의 손실에서 상당한 개선을 나타냅니다. 운영 손실은 82.5% 감소하여 210만 달러에 이릅니다.

주요 사업 하이라이트로는 25,000개 이상의 소매점으로 서비스 확대, 장기 계약 확보, AI 구매 및 여행 솔루션을 위한 핵심 기술로 GFAI Agents 개발이 포함됩니다. 또한 회사는 LinguaBot 및 RoboTravel Agent와 같은 새로운 제품을 출시하며 Robot-as-a-Service (RaaS) 제공을 다양화했습니다.

환율로 인한 순수익의 소폭 감소(2.4%)에도 불구하고 Guardforce AI의 보안 물류 사업은 5.2% 성장했습니다. 이 회사는 2024년 상반기를 1,550만 달러의 현금 및 현금성 자산으로 마감했습니다.

Guardforce AI Co., (NASDAQ: GFAI) a annoncé des résultats financiers positifs pour le premier semestre 2024. Le bénéfice brut a augmenté de 50% par rapport au premier semestre 2023, avec une marge bénéficiaire brute passant à 18,4%. L'entreprise a réalisé un revenu net ajusté de 0,1 million de dollars, une amélioration significative par rapport à la perte de 1,8 million de dollars au premier semestre 2023. La perte d'exploitation a diminué de 82,5% pour atteindre 2,1 millions de dollars.

Les points forts de l'activité incluent l'expansion des services à plus de 25 000 magasins de détail, la sécurisation de contrats à long terme et le développement de GFAI Agents en tant que technologie clé pour les solutions d'achat et de voyage basées sur l'IA. L'entreprise a également diversifié ses offres de Robot-as-a-Service (RaaS), en lançant de nouveaux produits comme LinguaBot et RoboTravel Agent.

Malgré une légère baisse de 2,4% des revenus nets en raison des taux de change, l'activité logistique sécurisée de Guardforce AI a augmenté de 5,2%. L'entreprise a terminé le premier semestre 2024 avec 15,5 millions de dollars en liquidités et équivalents de liquidités.

Guardforce AI Co., (NASDAQ: GFAI) hat für das erste Halbjahr 2024 positive finanzielle Ergebnisse gemeldet. Der Bruttogewinn stieg um 50% im Vergleich zum ersten Halbjahr 2023, wobei die Bruttogewinnmarge auf 18,4% anstieg. Das Unternehmen erzielte ein bereinigtes Nettoergebnis von 0,1 Millionen Dollar, eine deutliche Verbesserung gegenüber dem Verlust von 1,8 Millionen Dollar im ersten Halbjahr 2023. Der Betriebsverlust ging um 82,5% auf 2,1 Millionen Dollar zurück.

Wichtige Geschäftshighlights umfassen die Erweiterung der Dienstleistungen auf über 25.000 Einzelhandelsgeschäfte, das Sichern von langfristigen Verträgen und die Entwicklung von GFAI Agents als zentrale Technologie für AI-Einkaufs- und Reise-Lösungen. Das Unternehmen hat auch sein Robot-as-a-Service (RaaS)-Angebot diversifiziert und neue Produkte wie LinguaBot und RoboTravel Agent auf den Markt gebracht.

Obwohl der Nettoumsatz aufgrund von Währungswechselkursen um 2,4% leicht gesunken ist, wuchs das gesicherte Logistikgeschäft von Guardforce AI um 5,2%. Das Unternehmen schloss das erste Halbjahr 2024 mit 15,5 Millionen Dollar in Bar und Baräquivalente.

Positive
  • Gross profit increased by 50% in H1 2024 compared to H1 2023
  • Gross profit margin improved from 12.0% to 18.4%
  • Adjusted net income of $0.1 million, compared to a $1.8 million loss in H1 2023
  • Operating loss decreased by 82.5% to $2.1 million
  • Selling, distribution, and administrative expenses decreased by 25.7%
  • Expanded services to over 25,000 retail stores
  • Secured long-term contracts with key clients
  • Guardforce Digital Machine (GDM) revenue increased by 74.3%
Negative
  • Net revenue decreased by 2.4% to $17.6 million due to foreign currency exchange rates
  • Cash and cash equivalents decreased from $26.0 million in H1 2023 to $15.5 million in H1 2024

Insights

Guardforce AI's H1 2024 results show significant improvements in profitability and operational efficiency. The 50% increase in gross profit and expansion of gross margin to 18.4% from 12.0% year-over-year are particularly noteworthy. The company's transition to adjusted net income of $0.1 million from a loss of $1.8 million in H1 2023 indicates a positive trajectory.

Key drivers include:

  • Cost control initiatives, reducing selling, distribution and administrative expenses by 25.7%
  • Growth in higher-margin services like Guardforce Digital Machine (GDM), up 74.3% YoY
  • Expansion of retail client base to over 25,000 stores
  • Long-term contract wins, including a 5-year Consolidated Cash Center operation

While revenue slightly decreased due to currency fluctuations, the core secured logistics business grew by 5.2%. The $15.5 million cash position provides a solid foundation for continued AI and robotics investments. The shift towards AI-driven solutions in travel and retail sectors positions GFAI for potential long-term growth, albeit with execution risks in a competitive tech landscape.

Guardforce AI's technological developments in H1 2024 demonstrate a strategic pivot towards AI-driven solutions, particularly in the travel and retail sectors. Key advancements include:

  • Development of GFAI Agents as a core AI technology foundation
  • Upgrade of the Guardforce AI Intelligent Cloud Platform
  • Launch of "LinguaBot" with generative AI capabilities
  • Introduction of RoboTravel Agent (RTA) with smart ticketing and promotion features
  • Expansion of AIoT Robot Advertising to the U.S. market
  • Implementation of a decentralized spatial computing solution

These initiatives showcase GFAI's commitment to leveraging AI for enhancing customer experiences and operational efficiencies. The focus on integrating various large language models and APIs into a unified cloud platform indicates a scalable approach to AI solution development. The company's strategy of utilizing insights from its extensive retail client base to develop tailored AI solutions could provide a competitive edge. However, the success of these technologies will depend on their real-world performance and adoption rates in the target industries.

Gross profit increased 50% in H1 2024 compared to H1 2023

Establishing a strong AI technology foundation for solution development in travel and retail

NEW YORK, Sept. 24, 2024 (GLOBE NEWSWIRE) -- Guardforce AI Co., Limited (“Guardforce AI” or the “Company”) (NASDAQ: GFAI, GFAIW), an integrated security, AI and Robot-as-a-Service (RaaS) provider, today announced financial results and provided a business update for the first half of 2024 (H1 2024) ended June 30, 2024.

H1 Financial Highlights

  • Gross profit increased by approximately 50% in H1 2024 compared to H1 2023, driven in part by an improvement in gross profit margin, which increased to approximately 18.4% in H1 2024, compared to approximately 12.0% in H1 2023
  • Adjusted net income (Non-IFRS) was approximately $0.1 million in H1 2024 compared to an adjusted net loss of approximately $1.8 million in H1 2023
  • Selling, distribution, and administrative expenses was approximately $5.0 million for H1 2024, a 25.7% decrease, compared to approximately $6.7 million for H1 2023
  • Operating loss improved by approximately $9.8 million, or 82.5%, to approximately $2.1 million in H1 2024, compared to approximately $11.9 million in H1 2023.
  • As of June 30, 2024, the Company had cash and cash equivalents and restricted cash of approximately $15.5 million

Lei (Olivia) Wang, Chairwoman and Chief Executive Officer of Guardforce AI, stated, "2024 marks a pivotal year for us as we improved financial performance and drove business from our established core technological foundation for our AI initiatives. Our primary focus is developing GFAI Agents, which serve as the key technological backbone for our AI-driven travel and purchase solutions. By concentrating on high-margin services within the retail and travel sectors, alongside implementing cost-control initiatives, we’ve achieved notable results. We expanded services to over 25,000 retail stores, turned adjusted net income positive (reconciliation below), and achieved an approximately 50.0% increase in gross profit in H1 2024 compared to H1 2023. These efforts have propelled us further on our transformative journey toward becoming a leading AI solution provider, while reinforcing a solid and sustainable business model.”

H1 2024 Business Highlights

  • Consolidated legacy business by securing long-term contracts with key clients, expanded retail client base, and drove growth in higher-margin solutions:
    • Guardforce Cash Solutions Security (Thailand) Company (GFCS) won a 5-year contract to operate a Consolidate Cash Center (CCC) in Chiang Mai, Thailand, to become the largest CCC operator on behalf of the Bank of Thailand, operating 50% of its CCC operations. This operation allows GFCS to upgrade facility capabilities without additional investment, enhancing the overall operation with higher profit margins.
    • Guardforce Digital Machine (GDM) revenue increased by approximately $0.8 million, or 74.3%, in H1 2024 compared to H1 2023. GDM is a higher profit-margin solution which provides clients, particularly retail clients, with digital cash processing solutions.
    • Beijing Wanjia Security System Limited secured two long-term contracts with existing key clients, expanding security alarm solutions to approximately an additional 3,900 stores, representing a more than 50% increase compared to 2023, and bringing the total stores serviced to approximately 12,000 stores across Mainland China.
    • The total number of retail stores served in the security sector surpassed 25,000, marking a transformative milestone in the client base. This strategy helps the Company better understand clients' needs, standard procedures, and industry pain points, allowing the development of customized AI solutions.
  • Developed GFAI Agents as the core technology foundation for AI Purchase and AI Travel Solutions:
    • Upgraded Guardforce AI Intelligent Cloud Platform as a unified cloud platform to integrate various large language models and third-party APIs for GFAI Agents development.
    • Leveraged client insights and service experience to develop GFAI Agents that address the challenge of matching the right products to end-users in the travel and retail industries.
    • Developed the proof of concept for the AI Travel Assistant to optimize travel routes, resources, and real-time agenda adjustments for end-users in the travel industry, as well as AI Purchase solutions to provide tailored product recommendations for end-users in retail.
  • Diversified existing RaaS solutions by:
    • Partnering with iApp Technology Co., Ltd, a Thailand-based technology company specializing in AI and data processing management, to launch “LinguaBot,” which integrates generative AI features to enhance the robots’ chatbot capabilities for concierge services.
    • Launching RoboTravel Agent (RTA), an upgraded AIoT Robot Advertising solution for the travel industry that includes a smart ticketing system and coupon promotion features for scenic sites.
    • Continuing partnership with China International Travel Service Shenzhen Co., Ltd (Nice Tour), and rolling out approximately 1,000 RTAs in Asia Pacific.
    • Expanding AIoT Robot Advertising to the U.S., with more than 200 robots deployed.
    • Launching a decentralized spatial computing solution that utilizes robots’ unused computing power to process complex tasks beyond advertising. This initiative will not only generate additional revenue for Guardforce AI but also offers the potential for revenue-sharing with businesses where the robots are deployed, creating a mutually beneficial business model.

“In 2024, we continue to focus on consolidating our legacy business, strengthening our client base in the travel and retail sectors, and accelerating R&D in AI solutions, particularly the development of GFAI Agents tailored for these industries. Our achievements in the first half of the year have laid a strong foundation for continued growth, as we remain committed to creating products and services that help our customers optimize their sales and marketing operations. Additionally, we continue to carefully manage our expenses and have implemented successful cost reduction strategies that have effectively lowered operating expenses overall,” concluded Ms. Wang.

Financial Overview

Net revenue decreased by approximately $0.4 million, or 2.4%, to approximately $17.6 million, for H1 2024, compared to approximately $18.0 million for H1 2023. The decrease is mainly due to the decrease of foreign currency exchange rates between Thai Baht and U.S. Dollars. Despite the impact of foreign currency exchange rates, revenue for the secured logistics business increased by approximately $0.8 million, or 5.2%, compared to the H1 2023. Gross profit increased to approximately $3.2 million for H1 2024, compared to approximately $2.2 million for H1 2023. Gross profit margin increased to 18.4% for H1 2024, from 12.0% for H1 2023, primarily due to cost control initiatives and a higher profit margin from our continued growing GDM business and Cash-In-Transit business with our retail customers.

For H1 2024, selling, distribution, and administrative expenses decreased significantly to approximately $5.0 million, compared to approximately $6.7 million for H1 2023, representing a 25.7% decrease. Operating loss was approximately $2.1 million in H1 2024, compared to approximately $11.9 million in H1 2023, mainly due to the reduction in fixed asset depreciation and inventory provisions. Adjusted net income (Non-IFRS) was approximately $0.1 million in H1 2024 compared to an adjusted net loss of approximately $1.8 million in H1 2023. As of June 30, 2024, and 2023, the Company had cash and cash equivalents and restricted cash of approximately $15.5 million and $26.0 million, respectively.

About Guardforce AI Co., Ltd.

Guardforce AI Co., Limited (NASDAQ: GFAI/GFAIW) is an integrated solution provider, specializing in security solutions, and focusing on implementing AI and robotics solutions to improve business operational efficiency and sales and marketing process, especially for the retail and travel industry in the Asia Pacific. Drawing upon 42 years' operational experience, established premiere long-term customer base, and sales channels, Guardforce AI has built a robust foundation towards the next level of elevating tailored AI solutions and expanding globally. For more information, visit www.guardforceai.com Twitter: @Guardforceai.

Safe Harbor Statement

This press release contains statements that do not relate to historical facts but are "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements can generally (although not always) be identified by their use of terms and phrases such as anticipate, appear, believe, continue, could, estimate, expect, indicate, intend, may, plan, possible, predict, project, pursue, will, would and other similar terms and phrases, as well as the use of the future tense. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on current beliefs, expectations and assumptions regarding the future of the business of the Company, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control, including the risks described in our registration statements and annual reports under the heading "Risk Factors" as filed with the Securities and Exchange Commission. Actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Forward-looking statements in this press release speak only as of the date hereof. Unless otherwise required by law, we undertake no obligation to publicly update or revise these forward-looking statements, whether because of new information, future events or otherwise.

Investor Relations:
David Waldman or Natalya Rudman
Crescendo Communications, LLC
Email: gfai@crescendo-ir.com
Tel: 212-671-1020

Guardforce AI Corporate Communications
Hu Yu
Email: yu.hu@guardforceai.com


Guardforce AI Co., Limited and Subsidiaries
Consolidated Statements of Profit and Loss
(Expressed in U.S. Dollars)

  For the six months ended
June 30,
 
  2024  2023   
  (Unaudited)  (Unaudited)   
Revenue $17,566,844  $18,005,603   
Cost of sales  (14,327,094)  (15,846,807)  
Gross profit  3,239,750   2,158,796   
           
Stock-based compensation  (172,655)  -   
Recovery (Provision for and write off) of withholding tax receivable  32,980   (561,277)  
Provision for expected credit loss on trade and other receivables  (184,180)  (870,408)  
Provision for obsolete inventories  -   (3,090,283)  
Impairment loss on fixed assets  -   (1,591,766)  
Impairment on goodwill  (30,467)  (1,263,040)  
Selling, distribution and administrative expenses  (4,967,290)  (6,683,850)  
Operating loss from continuing operations  (2,081,862)  (11,901,828)  
           
Other income, net  312,342   77,665   
Foreign exchange losses, net  (49,041)  (584,093)  
Finance costs  (81,534)  (578,308)  
Loss before income tax from continuing operations  (1,900,095)  (12,986,564)  
           
Provision for income tax benefit (expense)  22,949   (874,431  
Net loss for the period from continuing operations  (1,877,146)  (13,860,995)  
           
Discontinued operations:          
Net gain for the period from discontinued operations  38,719   11,562   
Net loss for the period  (1,838,427)  (13,849,433)  
Less: net profit (loss) attributable to non-controlling interests  9,167   (30,214)  
Net loss attributable to equity holders of the Company $(1,847,594) $(13,819,219)  
           
Loss per share          
Basic and diluted loss attributable to the equity holders of the Company $(0.18) $(4.35)  
           
Loss per share from continuing operations          
Basic and diluted loss attributable to the equity holders of the Company $(0.19) $(4.36)  
           
Weighted average number of shares used in computation:          
Basic and diluted  9,991,600   3,174,282   
           


Guardforce AI Co., Limited and Subsidiaries
Consolidated Balance Sheets
(Expressed in U.S. Dollars)

  As of
June 30,
2024
  As of
December 31,
2023
  (Unaudited)   
Assets     
Current assets:     
Cash and cash equivalents $13,979,217  $20,235,227 
Restricted cash  26,319   100,764 
Trade receivables  5,316,983   5,630,805 
Other current assets  2,633,799   1,665,571 
Withholding tax receivable, net  366,884   607,221 
Inventories  381,155   506,403 
Amounts due from related parties  13,086   2,172,638 
Assets held for sale  -   201,963 
Total current assets  22,717,443   31,120,592 
        
Non-current assets:       
Restricted cash  1,496,236   1,608,762 
Property, plant and equipment  3,280,470   4,043,725 
Right-of-use assets  2,588,540   2,688,208 
Intangible assets, net  2,684,655   2,836,250 
Goodwill  411,862   411,862 
Withholding tax receivable, net  1,504,543   1,617,625 
Deferred tax assets, net  1,110,164   1,085,477 
Other non-current assets  390,065   402,447 
Total non-current assets  13,466,535   14,694,356 
Total assets $36,183,978  $45,814,948 
        
Liabilities and Equity       
Current liabilities:       
Trade and other payables $3,047,534  $3,016,850 
Borrowings  187,288   337,241 
Borrowing from a related party  -   3,104,149 
Current portion of operating lease liabilities  1,457,783   1,239,066 
Current portion of finance lease liabilities  53,055   108,597 
Other current liabilities  1,764,636   3,171,643 
Amounts due to related parties  139,557   2,898,506 
Liabilities directly associated with the assets held for sale  -   130,876 
Total current liabilities  6,649,853   14,006,928 
        
Non-current liabilities:       
Borrowings  -   44,410 
Operating lease liabilities  1,124,195   1,455,857 
Finance lease liabilities  203,127   218,996 
Provision for employee benefits  4,591,555   4,935,982 
Total non-current liabilities  5,918,877   6,655,245 
Total liabilities  12,568,730   20,662,173 
        
Equity       
Ordinary shares – par value $0.12 authorized 300,000,000 shares, issued and outstanding 10,237,282 shares at June 30, 2024; issued and outstanding 9,830,373 shares at December 31, 2023  1,228,509   1,179,680 
Subscription receivable  (50,000  (50,000)
Additional paid in capital  82,011,907   80,983,164 
Legal reserve  223,500   223,500 
Warrants reserve  251,036   251,036 
Accumulated deficit  (60,188,269  (58,340,675)
Accumulated other comprehensive income  209,422   985,120 
Capital & reserves attributable to equity holders of the Company  23,686,105   25,231,825 
Non-controlling interests  (70,857)  (79,050)
Total equity  23,615,248   25,152,775 
Total liabilities and equity $36,183,978  $45,814,948 
         


Guardforce AI Co., Limited and Subsidiaries
Consolidated Statements of Cash Flows
(Expressed in U.S. Dollars)

  For the six months ended
June 30,
 
  2024  2023 
Cash flows from operating activities (Unaudited)  (Unaudited) 
Net (loss) from continuing operations $(1,877,146) $(13,860,995)
Net gain from discontinued operations  38,719   11,562 
Net loss  (1,838,427)  (13,849,433)
Adjustments for:        
Depreciation and Amortization of fixed and intangible assets  1,556,922   2,619,001 
Stock-based compensation  172,655   - 
(Recovery) Provision for and write off of withholding tax receivable  (32,980)  561,277 
Provision for expected credit loss on trade and other receivables  184,180   869,519 
Provision for obsolete inventories  -   3,090,282 
Impairment loss on fixed assets  -   1,591,766 
Impairment on goodwill  30,467   1,263,040 
Finance costs  81,778   584,897 
Interest income  (261,041)  - 
Deferred income taxes  (101,998)  874,431 
(Gain) Loss from assets disposal  (31,577)  41,965 
Gain on disposal of a subsidiary  (3,607)  - 
Changes in operating assets and liabilities:        
(Increase) Decrease in trade and other receivables  (90,891)  157,279 
Increase in other assets  (1,005,338)  (719,595)
Decrease in inventories  114,223   296,824 
(Decrease) Increase in amounts due to related parties  (386,720)  639,807 
(Decrease) Increase in Trade and other payables and other current liabilities  (437,966)  1,285,317 
Decrease (Increase) in withholding tax receivable  227,903   (374,013)
Increase in provision for employee benefits  13,428   20,774 
Net cash used in operating activities  (1,808,989)  (1,046,862)
         
Cash flows from investing activities        
Acquisition of property, plant and equipment  (34,442)  (829,231)
Proceeds from sale of property, plant and equipment  27,805   - 
Acquisition of intangible assets  (114,224)  (217,077)
Disposal of a subsidiary, net of cash disposed  (28,186)  - 
Interest received  283,750   - 
Net cash provided by (used in) investing activities  134,703   (1,046,308)
         
Cash flows from financing activities        
Proceeds from issue of shares  -   20,867,386 
Proceeds from exercise of warrants  -   506,693 
Cash paid for the cancellation of fractional shares  -   (49,664)
Proceeds from bank borrowings  -   1,756,738 
Repayment of bank borrowings  (252,717)  (1,937,096)
Repayment of related party borrowings  (3,304,787)  - 
Payment of lease liabilities  (877,553)  (1,267,979)
Net cash (used in) generated from financing activities  (4,435,057)  19,876,078 
         
Net (decrease)/increase in cash and cash equivalents, and restricted cash  (6,109,343)  17,782,908 
Effect of movements in exchange rates on cash held  (362,280)  16,840 
Cash and cash equivalents, and restricted cash at January 1,  21,973,395   8,230,644 
Cash and cash equivalents, and restricted cash at June 30, $15,501,772  $26,030,392 
         
Non-cash investing and financing activities        
Equity portion of purchase consideration paid for acquisition of subsidiaries  -   1,848,000 
         

Non-IFRS Financial Measures

To supplement our unaudited interim condensed consolidated financial statements, which are prepared and presented in accordance with IFRS, we use the non-IFRS adjusted EBITDA as financial measures for our consolidated results.

We believe that adjusted EBITDA helps identify underlying trends in our business that could otherwise be distorted by the effect of certain income or expenses that we include in income (loss) from operations and net income (loss). We believe that these non-IFRS measures provide useful information about our core operating results, enhance the overall understanding of our past performance and future prospects and allow for greater visibility with respect to key metrics used by our management in its financial and operational decision-making. We present the non-IFRS financial measures in order to provide more information and greater transparency to investors about our operating results.

EBITDA represents net (loss) income before (i) finance costs, income tax benefit and depreciation of fixed assets and amortization of intangible assets, which we do not believe are reflective of our core operating performance during the periods presented.

Non-IFRS adjusted net (loss) income represents net (loss) income before (i) finance costs, income tax benefit and depreciation of fixed assets and amortization of intangible assets, (ii) certain non-cash expenses, consisting of stock-based compensation expense, allowance for and write off of withholding tax receivables, provision for obsolete inventory and impairment loss on fixed assets.

Non-IFRS (loss) earnings per share represents non-IFRS net (loss) income attributable to ordinary shareholders divided by the weighted average number of shares outstanding during the periods. Non-IFRS diluted earnings per share represents non-IFRS net (loss) income attributable to ordinary shareholders divided by the weighted average number of shares outstanding during the periods on a diluted basis.

The table below is a reconciliation of our net loss to EBITDA and non-IFRS net (loss) income for the periods indicated:

  For the six months ended
June 30,
 
  2024  2023 
Net loss from continuing operations - IFRS $(1,877,146) $(13,860,995)
Finance costs  81,534   578,308 
Provision for income tax (benefit) expense  (22,949)  874,431 
Depreciation and amortization expense  1,556,922   2,619,001 
EBITDA  (261,639)  (9,789,255)
Stock-based compensation  172,655   - 
(Recovery) provision for and write off of withholding taxes receivable  (32,980)  561,277 
Provision for expected credit loss on trade and other receivables  184,180   870,408 
Provision for obsolete inventories  -   3,090,283 
Impairment loss on fixed assets  -   1,591,766 
Impairment on goodwill  30,467   1,263,040 
Foreign exchange losses, net  49,041   584,093 
Adjusted net income (loss) (Non-IFRS) $141,724  $(1,828,388)
Non-IFRS earnings (loss) per share        
Earnings (Loss) per share attributable to equity holders of the Company        
Basic and diluted $0.01  $(0.58)
         
Weighted average number of shares used in computation:        
Basic and diluted  9,991,600   3,174,282 

FAQ

What was Guardforce AI's (GFAI) gross profit increase in H1 2024?

Guardforce AI (GFAI) reported a 50% increase in gross profit for the first half of 2024 compared to the same period in 2023.

Did Guardforce AI (GFAI) achieve profitability in H1 2024?

Yes, Guardforce AI (GFAI) reported an adjusted net income of approximately $0.1 million in H1 2024, compared to an adjusted net loss of $1.8 million in H1 2023.

How many retail stores does Guardforce AI (GFAI) now serve?

Guardforce AI (GFAI) expanded its services to over 25,000 retail stores, marking a significant milestone in its client base expansion.

What new AI solutions did Guardforce AI (GFAI) develop in H1 2024?

Guardforce AI (GFAI) developed GFAI Agents as the core technology foundation for AI Purchase and AI Travel Solutions, including an AI Travel Assistant and tailored product recommendations for retail.

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