EMERGE Reports Strong Preliminary Q4 and Full Year 2022 Results

TORONTO, Jan. 31, 2023 /CNW/ - EMERGE Commerce Ltd. (TSXV: ECOM) ("EMERGE" or the "Company"), a diversified acquirer and operator of niche e-commerce brands, is providing selected preliminary unaudited results for its fourth quarter and full year ended December 31, 2022.

Preliminary Q4 and Full Year 2022 Financial Highlights

• Record Gross Merchandise Sales ("GMS")¹ in Q4 2022 expected to be between $32M and $33M, compared to $26.2M in Q4 2021
• Q4 2022 revenue expected to be between $15.0M and $15.5M, compared to revenue of $14.9M in Q4 2021
• For full year 2022, revenue is expected be between $57.9M and $58.4M, compared to $34.8M in 2021, representing YoY growth of over 66%, and an increase of approximately 60% compared to 2019 pre-pandemic pro forma revenue
• Year-end cash balance of approximately $5.7 million

Ghassan Halazon, EMERGE founder and CEO, commented, "Despite the persisting macro challenges, EMERGE has driven more gross merchandise sales¹ in Q4 than in any prior quarter, with more than 22% growth year-over-year expected, a testament to our largely resilient portfolio of mostly discount-driven brands that we expect will lend themselves well in the anticipated recessionary environment ahead. On an apples-to-apples basis, our expected revenue for 2022 is approximately 60% higher than our 2019 (pre-pandemic) pro forma revenue. We look forward to reporting our Q4 and full year 2022 financial results in the coming months."

Preliminary Unaudited Financial Information

The financial and operating results included in this news release are based on preliminary unaudited estimated results which have not yet been finalized or, in the case of annual results, audited. These estimated results are subject to change upon completion of the financial statements for the year ended December 31, 2022, and the audit of such financial statements and such changes could be material due to, among other things, the completion of EMERGE's financial closing procedures, final adjustments, review by EMERGE's auditors and other developments that may arise between now and the time the financial results are finalized. Accordingly, such estimated results are forward-looking statements (as defined below) within the meaning of applicable securities legislation and are subject to the limitations and risks described under "Forward-Looking Statements" below.

EMERGE anticipates filing its audited annual financial statements for the year ended December 31, 2022, and related management's discussion and analysis on SEDAR in late April 2023.

Unless otherwise noted, all amounts are in Canadian dollars.

About EMERGE
EMERGE is a diversified acquirer and operator of profitable niche e-commerce brands. Our subscription and marketplace e-commerce properties provide our members with access to pet products, premium meat, outdoor gear, golf, and other curated experiences. Our portfolio houses various online destinations including WholesalePet.com, trulocal.ca, BattlBox.com, UnderPar.com, JustGolfStuff.ca, CarnivoreClub.co, WagJag.com, BeRightBack.ca, and Wanlow.com. EMERGE was named one of Canada's Top Growing Companies by Globe and Mail in 2022 (and 2020), and one of the fastest growing companies in Canada by the Startup 50 in 2020.

To learn more visit https://www.emerge-commerce.com/

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Cautionary notice
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Non-GAAP Financial Measures

This press release makes reference to certain non-GAAP measures. These non-GAAP measures are not recognized measures under IFRS, do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing a further understanding of results of operations from management's perspective. Accordingly, they should not be considered in isolation nor as a substitute for analysis of the financial information of the Company reported under IFRS. Gross Merchandise Sales ("GMS") should not be construed as alternatives to revenue determined in accordance with IFRS. GMS does not have any standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other issuers.

GMS as defined by management is the total dollar value of customer purchases of goods and services, excluding applicable taxes and net of discounts and refunds. Management believes GMS provides a useful measure for the dollar volume of e-commerce transactions made through our platforms and an indicator for our business performance.

The following table reconciles preliminary GMS to revenue:

Preliminary Unaudited
	Q4 2022* $ (millions)	Q4 2021 $ (millions)
Revenue	15.2	14.9
Adjusted for:
Merchant costs deducted from net revenue	17.2	11.1
Sales added to deferred revenue and value of orders fulfilled not included in revenue	2.2	2.5
Deferred and other adjustments to revenue	(1.9)	(1.9)
Advertising revenue	(0.2)	(0.3)
GMS	32.5	26.2

*Amounts for Q4 2022 in the table are preliminary and represent the mid-point of our expected range.

A description and reconciliation of the adjusted measures will be included in the Company's management discussion & analysis for the three and twelve months ended December 31, 2022.

Notice regarding forward-looking statements

This press release may contain certain forward-looking information and statements ("forward-looking information") within the meaning of applicable Canadian securities legislation, that are not based on historical fact, including without limitation statements containing the words "believes", "anticipates", "plans", "intends", "will", "should", "expects", "continue", "estimate", "forecasts" and other similar expressions. Readers are cautioned to not place undue reliance on forward-looking information. Actual results and developments may differ materially from those contemplated by these statements. The Company undertakes no obligation to comment on analyses, expectations or statements made by third-parties in respect of the Company, its securities, or financial or operating results (as applicable). Although the Company believes that the expectations reflected in forward-looking information in this press release are reasonable, such forward-looking information has been based on expectations, factors and assumptions concerning future events which may prove to be inaccurate and are subject to numerous risks and uncertainties, certain of which are beyond the Company's control, including the risk factors discussed in the Company's annual information form, which are available through SEDAR at www.sedar.com. The forward-looking information contained in this press release are expressly qualified by this cautionary statement and are made as of the date hereof. The Company disclaims any intention and has no obligation or responsibility, except as required by law, to update or revise any forward-looking information, whether as a result of new information, future events or otherwise.

On Behalf of the Board
Ghassan Halazon
Director and CEO

(1)	Non-GAAP Financial Measure. Refer to section "Non-GAAP Financial Measures" below for additional information.

SOURCE EMERGE Commerce Ltd.

Ghassan Halazon or Jonathan Leong, EMERGE Commerce Ltd., 416-479-9590, [email protected]