Kontrol Technologies Announces Second Quarter 2025 Financial Results

Globe and Mail

3 days ago

Kontrol Technologies Corp. (Cboe.ca:KNR) (OTCQB:KNRLF) (FSE:1K8) ("Kontrol Technologies" or "Kontrol" or "Company") announces its results for the three months and year to date ended June 30, 2025. A complete set of the Financial Statements and Management's Discussion & Analysis have been filed on SEDAR ( www.sedarplus.ca).
Highlights
Net Income positive in Q2
Increase in aggregate cash and marketable securities
Continued progression of Kontrol BuildX AI platform
'The Company's cash and marketable securities position gives us the necessary resources to accelerate organic growth plans and to complete potential acquisitions,' says Paul Ghezzi, CEO of Kontrol. 'While the Company has not closed any new acquisitions in recent quarters, we have identified targets and continue the process of performing detailed due diligence reviews. We experienced some softness in the market with customers slowing their spending on capex projects, primarily related to tariff risks, however, maintenance and service solution margins have remained strong. We anticipate a recovery of spending on capex projects in the third and fourth quarters. We continue to service approximately 400 commercial buildings.'
Q2 2025 and Year to Date Highlights
In Q2 2024, the Company completed the sale of the operational net assets of CEM Specialties Inc. and as such revenue and earnings are lower in 2025 compared to the same period in the prior year.
As at June 30, 2025 the Company's aggregate cash and marketable securities balance was $11.6 million, an increase of $400,000 from the previous quarter.
Revenues for the three months ended June 30, 2025 were $1.3 million, compared to $3.7 million for the same quarter in the prior year; Revenues for the six months ended June 30, 2025 were $2.8 million, compared to $7.4 million for the same period in the prior year.
Gross margin for the six months ended June 30, 2025 was 56%, compared to 58% for the same period in the prior year.
Net income for the three months ended June 30, 2025 was $230,592 compared to $12.3 million for the same quarter in the prior year; Net income (loss) for the six months ended June 30, 2025 was $(915,240) compared to $12.9 million for the same period in the prior year. Net income (loss) in 2025 includes income from revaluation of marketable securities. Net income in 2024 includes gain on sale of the CEMSI net assets.
Adjusted EBITDA for the six months ended June 30, 2025 was negative $(597,553) compared to $440,037 for the same period in the prior year.
The Company had no outstanding interest-bearing bank debt at June 30, 2025.
Kontrol BuildX AI – New AI Solution
As previously announced, the Company has initiated the development of a new AI driven solution for its customers.
'We see a significant addressable market opportunity to integrate, analyze, and operationalize large volumes of data for our customers using AI. We seek to help our customers enhance operational efficiency, support predictive analytics, and drive outcomes to operate a better building,' continues Ghezzi.
Corporate Branding
The Company is updating its website and social media platforms. The updated branding is anticipated to be completed by the end of August 2025.
Normal Course Issuer Bid
During the six months ended June 30, 2025, the Company repurchased 1,362,000 common shares for a total of $235,000. Pursuant to the Normal Course Issuer Bid approved by Cboe Canada, Kontrol may purchase, from time to time, over a period of 12 months starting April 14th, 2025, and ending April 13th, 2026, up to 2,757,858 common shares. The Company has 54,529,169 shares outstanding as at June 30, 2025.
Q2 2025 and Year to Date Financial Summary
Financial Results
Three months ended
Six months ended
(Unaudited)
June 30, 2025
June 30, 2024
June 30, 2025
June 30, 2024
Revenue
$1,257,424
$3,654,825
$2,750,807
$7,441,059
Gross profit
$739,623
$2,020,525
$1,547,428
$4,352,600
Net income (loss)
$230,592
$12,321,014
$(915,240)
$12,854,502
Basic and diluted EPS
$0.00
$0.21
$(0.02)
$0.22
Add/Deduct for Adjusted EBITDA reconciliation:
Amortization and depreciation
$156,781
$228,334
$312,833
$450,717
Finance expense (income)
$(32,155)
$91,967
$(62,363)
$250,629
Gain on sale of assets
-
$(13,241,405)
-
$(13,241,405)
Revaluation of marketable
securities
$(772,724)
-
$(29,729)
-
Share based compensation
$48,473
$73,637
$96,946
$125,594
Adjusted EBITDA
$(369,033)
$(526,453)
$(597,553)
$440,037
Adjusted EBITDA is a non-International Financial Reporting Standards ("IFRS") measure used by management that is not defined by IFRS. Adjusted EBITDA does not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measures presented by other issuers. Management believes that Adjusted EBITDA provides meaningful and useful financial information as these measures demonstrate the operating performance of the business excluding non-cash charges.
"Adjusted EBITDA" is calculated as net income or loss before interest, income taxes, amortization, and depreciation, share based compensation, acquisition related expenses, listing expense, gain or loss on sale of assets, revaluation and impairment of assets.
Readers are cautioned that Adjusted EBITDA should not be construed as an alternative to net income as determined under IFRS; nor as an indicator of financial performance as determined by IFRS; nor a calculation of cash flow from operating activities as determined under IFRS; nor as a measure of liquidity and cash flow under IFRS. The Company's method of calculating Adjusted EBITDA may differ from methods used by other companies and, accordingly, the Company's Adjusted EBITDA may not be comparable to similar measures used by any other company.
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 provides solutions and services to its customers to improve energy management and accelerate the sustainability of all buildings. 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.sedarplus.ca.
Neither IIROC nor any stock exchange or other securities regulatory authority accepts responsibility for the adequacy or accuracy of this release.
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 Kontrol 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 those technologies will not prove as effective as expected; those 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.
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.