POSaBIT Reports Fourth Quarter and Annual 2024 Financial Results

Adjusted Gross Profit Grows Year over Year 19%

2024 Point of Sale Store Growth of over 50%

Successful eCommerce & Menu Launch

Groundwork laid for future success - OpEx decrease of 35% in 2024

TORONTO & SEATTLE--(BUSINESS WIRE)-- POSaBIT Systems Corporation (CSE: PBIT, OTC: POSAF) (the “Company” or “POSaBIT”), a leading provider of payments infrastructure in the cannabis industry, today announced its financial results for the three and twelve months ended December 31, 2024.

“After a turbulent 2023 for the cannabis industry at large, POSaBIT’s main focus in 2024 was solidifying the health of the company for the present and the future. There were few, if any, winners in our industry over the past two years, but we are proud of how deftly we’ve placed POSaBIT in a position to thrive in the long run,” said Ryan Hamlin, co-founder and CEO of POSaBIT.

Hamlin continued, “Adjusted gross profit dollars increased 19% year over year, OpEx is down significantly, and our cash situation is relatively unchanged. Our Point-of-Sale business - with its steady monthly revenue and future payments revenue potential - continues to grow rapidly and has gained an incredible reputation across the cannabis industry. Through our world-class products, POSaBIT remains focused on consistent and responsible growth.”

Recent Operational Highlights

• POSaBIT continues to dominate its home market of Washington State, with its Point of Sale now in over 70% of all dispensaries and processing over 85% of all sales
• Since the beta launch of POSaBIT’s eCommerce/Menu in Q3 of 2024, nearly 100 dispensaries have adopted the eComm platform
• Quarter over quarter adjusted revenue, adjusted gross profit and adjusted EBITDA remains stable, a trend that is expected to continue throughout 2025
• POSaBIT continues to focus on operational efficiencies to ensure POSaBIT remains cash flow positive in 2025

Balance Sheet

As of December 31, 2024, the Company had cash and cash equivalents of $1 million compared to $1.5 million as of December 31, 2023. This slight reduction in cash is due to paying off aged accounts payables as well as a cash settlement for an outstanding lawsuit.

Financial Results

in US Dollars	Twelve Months ended
	December 31, 2024	December 31, 2023	% Chg.
Revenue	$15,273,846	$43,575,060	(65)%
Cost of goods sold	$(8,269,317)	$(34,353,041)	76%
Gross profit	$7,004,529	$9,222,019	(24)%
GP margin %	46%	21%	25%
Operating costs	$(12,175,821)	$(18,769,176)	35%
Operating income (loss)	$(5,171,292)	$(9,547,157)	46%
Other (expenses) income	$(557,307)	$(3,978,073)	(86)%
Income (Tax) Recovery	$12,240	$(235,200)	105%
Income (loss)	$(5,716,359)	$(13,760,430)	59%

The following table discloses Adjusted Revenue, Adjusted Gross Profit and Adjusted EBITDA for Q4 2024 compared to Q3 2023.

in US Dollars	Q4 vs. Q3 2024 Adjusted Financials
	Q4 2024	Q3 2024
Adjusted Revenue	$4,069,594	$4,983,787
Adjusted Gross Profit	$2,611,622	$2,711,141
Adjusted EBITDA	$82,904	$148,128

The following tables reconcile Revenue, as reported to Adjusted Revenue, Gross Profit, as reported to Adjusted Gross Profit and EBITDA, as reported to Adjusted EBITDA for the twelve months ended December 31, 2024.

in US Dollars	Full Year 2024 Adjusted Financials
	December 31, 2024
Revenue as reported	$15,273,846
Add: Cash receipts from licensing contracts	$4,918,145
Deduct: Licensing support revenue	$(1,545,000)
Adjusted Revenue	$18,646,991

	December 31, 2024
Gross Margin as reported	$7,004,529
Add: Cash Receipts from Licensing contracts	$4,918,145
Add: One-Time Channel Partner revenue-sharing payment (excluded in prior periods)	$178,000
Deduct: Licensing Support Revenue as reported	$(1,545,000)
Adjusted Gross Profit	$10,555,674
Adjusted Gross Profit Margin	57%

	December 31, 2024
Loss, as reported	$(5,716,359)
Deduct: Foreign exchange gains, as reported	$(298,941)
Add: Share-based compensation, as reported	$1,184,450
Add: Depreciation, as reported	$152,131
Deduct: Change in expected credit losses, as reported	$(10,917)
Add: Finance costs, as reported	$454,530
Add: Write-off obsolete revenue-generating equipment, as reported	$410,062
Add: Interest accretion, as reported	$18,175
Add: Litigation settlements, as reported	$350,000
Add: Bad debts (net of bad debt recoveries), as reported	$16,210
Add: Transaction costs, as reported	$210,976
Deduct: Income tax recovery, as reported	$(12,240)
EBITDA	$(3,241,923)
Deduct: Licensing support revenue, as reported	$(1,545,000)
Deduct: Licensing revenue interest income, as reported	$(891,729)
Add: Cash receipts from licensing agreement, as reported	$4,918,145
Adjusted EBITDA	$(760,507)

Conference Call Information

Date: April 24, 2025
Time: 4:30 PM Eastern Time
Toll Free: 888-506-0062
International: 973-528-0011
Participant Access Code: 977825
Webcast URL: https://www.webcaster4.com/Webcast/Page/2708/52361

Conference Call Replay Information:

The replay will be available approximately 1 hour after the completion of the live event.

Toll Free: 877-481-4010
International: 919-882-2331
Replay Passcode: 52361
Webcast Replay URL: https://www.webcaster4.com/Webcast/Page/2708/52361

Financial Reports

Full details of the financial and operating results are described in the Company’s consolidated financial statements for the three and twelve month periods ended December 31, 2024 with accompanying notes. The consolidated financial statements and additional information about POSaBIT are available on the Company’s website at www.posabit.com/investor-relations or on SEDAR+ at www.sedarplus.ca.

Non-IFRS Measures

Adjusted Revenue, Adjusted Gross Profit and Adjusted EBITDA are non-IFRS measures used by management that do not have any prescribed meaning by IFRS and may not be comparable to similar measures presented by other companies. The Company defines Adjusted Revenue as gross revenue, minus license support revenue, plus actual licensing cash received as part of POSaBIT’s licensing deals. The Company defines Adjusted Gross Profit as Adjusted Revenue less company cost of goods sold. The Company defines Adjusted EBITDA as net income or loss generated for the period as reported, before interest, taxes, depreciation and amortization and further adjusted in accordance with the reconciliation table set out in this press release. The Company believes these non-IFRS measures are useful metrics to evaluate its core operating performance and uses these measures to provide shareholders and others with supplemental measures of its operating performance. The Company also believes that securities analysts, investors and other interested parties, frequently use these non-IFRS measures in the evaluation of companies, many of which present similar metrics when reporting their results. We caution readers that Adjusted Revenue, Adjusted Gross Profit and Adjusted EBITDA are not substitutes for gross revenue, gross profit or profit/loss, respectively.

Forward-Looking Statements

This press release contains forward-looking statements, including statements regarding our business strategy, product development, timing of product development, events and courses of action.

Statements which are not purely historical are forward-looking statements and include any statements regarding beliefs, plans, outlook, expectations or intentions regarding the future including words or phrases such as “anticipate,” “objective,” “may,” “will,” “might,” “should,” “could,” “can,” “intend,” “expect,” “believe,” “estimate,” “predict,” “potential,” “plan,” “is designed to” or similar expressions suggesting future outcomes or the negative thereof or similar variations. Forward-looking statements may include, among other things, statements about: our expectations regarding annual cost reductions; expected financial results for 2025; our future customer concentration; our anticipated cash needs and our estimates regarding our capital requirements; our ability to anticipate the future needs of our customers; our plans for future products and enhancements of existing products; our future growth strategy and growth rate; our future intellectual property; and our anticipated trends and challenges in the markets in which we operate. Such statements and information are based on numerous assumptions regarding present and future business strategies and the environment in which POSaBIT will operate in the future, including the demand for our products, anticipated costs and ability to achieve goals. Although we believe that the assumptions underlying these statements are reasonable, they may prove to be incorrect. Given these risks, uncertainties and assumptions, you should not unduly rely on these forward-looking statements.

Forward-looking statements are subject to known and unknown risks, uncertainties and other important factors that may cause the actual results to be materially different from those expressed or implied by such forward-looking statements, including but not limited to, business, economic and capital market conditions; the ability to manage our operating expenses, which may adversely affect our financial condition; our ability to remain competitive as other better financed competitors develop and release competitive products; regulatory uncertainties; market conditions and the demand and pricing for our products; our relationships with our customers, distributors and business partners; our ability to successfully define, design and release new products in a timely manner that meet our customers’ needs; our ability to attract, retain and motivate qualified personnel; competition in our industry; our ability to maintain technological leadership; our ability to manage risks inherent in foreign operations; the impact of technology changes on our products and industry; our failure to develop new and innovative products; our ability to successfully maintain and enforce our intellectual property rights and defend third-party claims of infringement of their intellectual property rights; the impact of intellectual property litigation that could materially and adversely affect our business; our ability to manage working capital; and our dependence on key personnel. POSaBIT is an early-stage company with a short operating history; it may not achieve profitability; and it may not actually achieve its plans, projections, or expectations.

Important factors that could cause actual results to differ materially from POSaBIT’s expectations include consumer sentiment towards POSaBIT’s products, litigation, global economic climate, loss of key employees and consultants, additional funding requirements, changes in laws, technology failures, competition, and failure of counterparties to perform their contractual obligations.

Neither we nor any of our representatives make any representation or warranty, express or implied, as to the accuracy, sufficiency or completeness of the information in this news release. Neither we nor any of our representatives shall have any liability whatsoever, under contract, tort, trust or otherwise resulting from the use of the information in this news release or for omissions from the information in this news release.

ABOUT POSABIT

POSaBIT (CSE: PBIT, OTC: POSAF) is a FinTech, working exclusively within the cannabis industry. We provide a best-in-class Point-of-Sale solution and are the leading cashless payment provider for cannabis retailers. We work tirelessly to build better financial services and transaction methods for merchants. We bring cutting-edge software and technology to the cannabis industry so that all merchants can have a safe and compliant set of services to solve the problems of a cash-only industry. For additional information, visit www.posabit.com.

Neither the Canadian Securities Exchange nor the Canadian Investment Regulatory Organization accepts responsibility for the adequacy or accuracy of this release.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250424691555/en/

Investor Relations:

investors@posabit.com

Media Relations:

Oscar Dahl

855-767-2248

hello@posabit.com

Management:

Ryan Hamlin

Co-founder and CEO of POSaBIT

855-767-2248

investors@posabit.com

Source: POSaBIT Systems Corporation