Advantex Announces Q2 2025 Financial Results

TORONTO, Feb. 27, 2025 /CNW/ - Advantex Marketing International Inc. (CSE: ADX) ("Advantex" or the "Company") today announced its financial results for the second quarter ended December 31, 2024. All results are reported under International Financial Reporting Standards ("IFRS") and in Canadian dollars, unless otherwise specified.

Key Financial Highlights:

• Revenue: Total revenue for Q2 2025 was $0.90 million, an increase of 4.2% from $0.86 million in Q2 2024. The growth was primarily driven by continued uptake in the Aeroplan program.
• Gross Profit: Gross profit for Q2 2025 was $0.57 million, compared to $0.67 million in Q2 2024. The decrease reflects an increase in the allowance for bad debt within the MCA program to proactively manage credit risk.
• EBITDA (before interest, taxes, depreciation, and amortization): Income from operations before interest and non-cash expenses was $0.17 million, down from $0.22 million in Q2 2024, due to higher direct expenses.
• Net Loss: Net loss for Q2 2025 was $0.60 million, compared to $0.53 million in Q2 2024. The increase in net loss was mainly due to higher non-cash interest expenses related to the 9% and 12% debentures.

Merchant Cash Advance (MCA) Program:

• Revenue from the MCA program was $0.58 million, slightly down from $0.58 million in Q2 2024.
• The Company continues to expand its transaction credits, which grew by $0.47 million in the quarter.
• Enhanced credit risk monitoring was implemented to mitigate potential losses amid ongoing economic uncertainty.

Aeroplan Program:

• Revenue from the Aeroplan program grew 14.6% to $0.32 million in Q2 2025, compared to $0.28 million in Q2 2024.
• The increase was driven by higher merchant participation and the continued success of the MCA Aeroplan product.

Strategic and Operational Highlights:

• Gross Margin Improvements: The Company continues to refine its operations, maintaining stable margins in the Aeroplan program and addressing delinquent accounts in the MCA program in a timely manner.
• Capital Management: In December 2024, the Company successfully secured agreements to defer interest payments on its 9% 2025 debentures, ensuring continued support for the MCA program growth and strengthening the Company's liquidity position.
• Expense Management: Selling, general, and administrative (SG&A) expenses declined by 7% compared to Q2 2024, reflecting ongoing cost control measures.

Outlook:

Advantex remains committed to growing its MCA and Aeroplan programs while optimizing operational efficiencies. With inflation stabilizing and anticipated interest rate reductions from the Bank of Canada, the Company is cautiously optimistic about future growth. However, challenges remain, including economic headwinds and the potential need for additional capital to expand its MCA program.

About Advantex:

Advantex is a leading provider of merchant cash advance services to small independent merchants across Canada. The Company also operates a partnership with Aeroplan, offering businesses the opportunity to provide Aeroplan points to their customers. Advantex is listed on the Canadian Securities Exchange under the symbol ADX.

Forward-Looking Information:

This news release contains certain "forward-looking information" within the meaning of applicable securities legislation. Forward-looking information includes, but is not limited to, the Company's future financial performance, business strategy, future financing, and its ability to meet obligations and achieve operational goals. The forward-looking information is based on current expectations and assumptions made by management in light of its experience and perception of historical trends, current conditions, and expected future developments. Forward-looking information is subject to known and unknown risks, uncertainties, and other factors that may cause actual results to differ materially from those anticipated or implied by such forward-looking information. These risks include, but are not limited to, general economic conditions, interest rates, inflation, the ability to raise additional financing, and risks related to the Company's business and operations.

The Company undertakes no obligation to update forward-looking information, except as required by law. Readers are encouraged to consult the Company's public filings for a full discussion of risks and uncertainties related to forward-looking information.

SOURCE Advantex Marketing International Inc.

For more information, please contact: Santhosh Kumar, Chief Financial Officer, Advantex Marketing International Inc., Tel: [phone], Email: [email protected]