Pineapple Financial Inc. Announces 59.04 Percent Revenue Growth in Fiscal 2024 Second Quarter Ended February 29, 2024
- Pineapple Financial Inc. achieved a 59.04% revenue growth in the fiscal 2024 second quarter, totaling $784,869.
- The company reported a 17.6% increase in residential mortgage loans, generating $314.963 million in Q2 fiscal 2024.
- Despite a 33.3% rise in SG&A expenses, Pineapple reduced its net loss by 4% to $657,456 in fiscal Q2 2024.
- For the first six months of fiscal 2024, Pineapple saw a 1% improvement in revenue to $1,352,858, with a 7.2% increase in mortgage loans.
- The company's cash position on February 29, 2024, was $1,339,618, with total liquidity of $2,417,239.
- Pineapple Financial Inc. added the CEO, opened offices in multiple locations, deployed an improved online mortgage application, and launched custom advertising software during the quarter.
- SG&A expenses rose by 33.3% in the fiscal 2024 second quarter, reaching $592,202.
- The company experienced a net loss of $657,456 in fiscal Q2 2024, despite reducing it by 4% compared to the same period in fiscal 2023.
- Pineapple's net loss increased to $1,530,696 in the first half of fiscal 2024, compared to $1,403,748 in the same period in fiscal 2023.
Insights
When dissecting financial earnings, it's important to note the considerable revenue growth of 59.04% year-over-year for the quarter, which showcases a positive trend in the company's sales performance. However, an astute investor would observe that despite this increase, the company reported a net loss, which actually improved by 4% compared to the previous year. This suggests that while revenue is growing, profitability is still a challenge.
The increase in SG&A expenses by 33.3% is significant and attributed to expansion and travel costs. These are often necessary costs for growth but must be monitored closely as they can erode profitability if not managed effectively. It's also worth noting the improved cash position, which indicates some degree of liquidity and financial stability.
A rise in residential mortgage loan generation by 17.6% is a robust indicator of market share growth within the mortgage sector. This performance should be weighed against market averages and competitor performance to fully gauge its impact. However, investors should be cautious as the company's bottom line doesn't reflect the same success due to the net loss reported.
Furthermore, the strategic expansion into new metropolitan areas and the rollout of new technologies implies an aggressive growth strategy, which could potentially increase market penetration and lead conversion in the longer term. Yet, such investments take time to reflect in net profitability and their success is not guaranteed.
The deployment of an improved online mortgage application signifies investment in tech infrastructure, aiming to streamline operations and enhance customer experience. This move is important in an industry that is increasingly becoming digitized. The launch of custom advertising banner management software could also indicate a focus on more targeted and efficient marketing efforts. These tech advancements could be a differentiator in the competitive mortgage landscape and might contribute to higher conversion rates and customer retention in the long run, although they will also incur short-term costs.
Pineapple generated
Selling, general and administrative expenses during the three months ended February 29, 2024, were
For the first six months of fiscal 2024, which ended February 29, 2024, the company had revenue of
The company generated
SG&A expenses in the first half of fiscal 2024 were
The company's cash position on February 29, 2024, was
Weighted average common shares outstanding were 6,475,300 on February 29, 2024, and 6,306,979 on February 28, 2023.
"We are very gratified by our 2024 second fiscal results," said co-founder and chief executive officer Shubha Dasgupta. "Though the Canadian mortgage industry faced challenging conditions during this period, Pineapple achieved major improvements in both its loan generation volume and total revenue."
During the quarter, the company added the CEO, opened offices in metro
"We're seeing terrific results from our internal tech improvements and marketing and expansion activities initiated during fiscal Q2. I believe that, as our industry outlook continues to improve, Pineapple will continue to demonstrate improved top and bottom line performance for the remainder of the fiscal year and beyond."
Pineapple Financial Inc.
Condensed Interim Consolidated Statements of Operations and Comprehensive Loss (Unaudited)
For the three months and six months ended February 29, 2024
(Expressed in US Dollars)
Three months ended | Six months ended | |||||||||||||||||||
February 29, 2024 | February 28, 2023 | February 29, 2024 | February 28, 2023 | |||||||||||||||||
For the period ended | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||||
Revenue | $ | 784,869 | 493,491 | $ | 1,352,858 | 1,334,692 | ||||||||||||||
Expenses | ||||||||||||||||||||
Selling, general and administrative | 592,202 | 444,226 | 1,031,947 | 1,104,082 | ||||||||||||||||
Advertising and Marketing | 150,597 | 354,680 | 404,017 | 469,321 | ||||||||||||||||
Salaries, wages and benefits | 541,062 | 654,683 | 1,186,316 | 1,274,549 | ||||||||||||||||
Interest expense and bank charges | 28,450 | 19,164 | 49,881 | 39,391 | ||||||||||||||||
Depreciation | 160,999 | 127,642 | 315,184 | 210,975 | ||||||||||||||||
Share-based compensation | - | (28,892) | - | 33,041 | ||||||||||||||||
Government Incentive | (29,109) | (392,919) | (80,334) | (392,919) | ||||||||||||||||
Total expenses | $ | 1,444,201 | 1,178,584 | $ | 2,907,011 | 2,738,440 | ||||||||||||||
Loss from operations | (659,332) | (685,093) | (1,554,153) | (1,403,748) | ||||||||||||||||
Foreign exchange gain (loss) | - | 10,772 | - | |||||||||||||||||
Gain (loss) on change in fair value of warrant liability | 1,876 | - | 12,685 | - | ||||||||||||||||
Loss before income taxes | $ | (657,456) | (685,093) | $ | (1,530,696) | (1,403,748) | ||||||||||||||
Income taxes (recovery) expense | - | |||||||||||||||||||
Net loss | $ | (657,456) | (685,093) | $ | (1,530,696) | (1,403,748) | ||||||||||||||
Foreign currency translation adjustment | 1,727 | 61,846 | (10,451) | (135,078) | ||||||||||||||||
Net loss and comprehensive loss | $ | (655,729) | (623,247) | $ | (1,541,147) | (1,538,826) | ||||||||||||||
Loss per share - basic and diluted ($) | (0.10) | (0.10) | (0.24) | (0.24) | ||||||||||||||||
Weighted average number of common shares outstanding - basic and diluted | 6,475,300 | 6,306,979 | 6,475,300 | 6,306,979 | ||||||||||||||||
The accompanying notes are an integral part of these condensed interim consolidated financial statements |
Pineapple Financial Inc. is an award-winning fintech and leading Canadian mortgage brokerage network, focusing on both the long-term success of agents and brokerages, as well as the overall experience of homeowners. With approximately 700 brokers within the network, Pineapple creates cutting-edge cloud-based tools and AI-driven systems to enable its brokers to help Canadians realize their dream of owning a home. Pineapple is active within the community and is proud to sponsor charities across Canada to improve the lives of fellow Canadians.
Certain statements in this announcement are forward-looking statements, including, but not limited to, the Company's proposed Offering. These forward-looking statements involve known and unknown risks and uncertainties and are based on the Company's current expectations and projections about future events that the Company believes may affect its financial condition, results of operations, business strategy and financial needs, including the expectation that the Offering will be successfully completed. Investors can identify these forward-looking statements by words or phrases such as "may," "will," "expect," "anticipate," "aim," "estimate," "intend," "plan," "believe," "is/are likely to," "potential," "continue" or other similar expressions. The Company undertakes no obligation to update or revise publicly any forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations that arise after the date hereof, except as may be required by law. These statements are subject to uncertainties and risks including, but not limited to, the uncertainties related to market conditions and the completion of the initial public offering on the anticipated terms or at all, and other factors discussed in the "Risk Factors" section of the registration statement filed with the SEC. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and the Company cautions investors that actual results may differ materially from the anticipated results and encourages investors to review other factors that may affect its future results in the Company's registration statement and other filings with the SEC. Additional factors are discussed in the Company's filings with the SEC, which are available for review at www.sec.gov.
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SOURCE Pineapple Financial Inc.
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