Pineapple Financial Inc. Announces Fiscal 2023 Financial Results: Projects Profitability in Fiscal 2024

TORONTO, Dec. 14, 2023 /CNW/ - Pineapple Financial Inc. (NYSE American: PAPL), a leading tech-focused mortgage firm with an integrated network of partner brokerages and agents across Canada, today announced its fiscal year 2023 ended August 31 results. The company reported a net loss of $2,809,036, or $(0.45) per share, on revenue of $16,434,100. This compares to a net loss of $2,810,061, or $(0.45) per share, on revenue of $20,380,984 for the fiscal year ended August 31, 2022. The 19 percent decrease in fiscal year revenue was primarily due to The Bank of Canada's interest rate increase from 2.5% as of September 1, 2022, to 5.00% as of August 31, 2023.

This measure, aimed at curbing inflation, and economic uncertainties led to a 26 percent decline in mortgage originations in Canada during the year ended August 31, 2023, impacting the mortgage business nationwide. In contrast, Pineapple Financial, by strategically expanding its national footprint and adding more users than in previous years, experienced only a 19 percent decline in revenue during this period.

The company also marginally reduced its net loss, primarily due to an 18 percent decrease in expenses during fiscal 2023 as compared to the previous fiscal year.

Cash on hand on August 31, 2023, was $720,365 compared to $3,896,840 on August 31, 2022. This reduction was primarily the result of the company's working capital and capital expenditures during fiscal 2023, specifically those associated with technological enhancements, investments in skilled personnel, and marketing services.

Pineapple's current cash position, however, includes the receipt of IPO gross proceeds of approximately $3.5 million on November 3, 2023.

The total shares outstanding on August 31, 2023, and August 31, 2022, was 6,306,978.

In fiscal 2024, Pineapple said it expects to increase market share by deploying strategies aimed at achieving both technological innovation and strategic expansion. Among these measures are the leveraging of optimized borrower data analytics, introducing a comprehensive suite of insurance products, and expanding into new provinces and regions across Canada. The company will also continue the use of a recently announced streamlined online mortgage application providing potential homebuyers with quick and efficient insights into their borrowing capacity.

Chief executive officer Shubha Dasgupta added, "The company's growth in 2024 will also likely be buoyed by the industry forecast that, during the next 24 months, 60 percent – or $1.5 trillion – in the Canadian mortgage market is up for renewal. Couple that with the growth in population, need for housing starts, and the short-term cyclical nature of our market, and we are poised and ready for an exciting future."

Mr. Dasgupta continued, "We project profitability in fiscal 2024 and anticipate even stronger bottom-line performance in fiscal 2025.

"Additionally, to enhance shareholder value, we are actively exploring the initiation of a stock buy-back program in the next six to twelve months."

Investor Conference Call

The company will host a conference call on Friday, December 15, 2023, at 8:00 AM Eastern time to discuss Pineapple's fiscal 2023 financial results. To participate in the call, please dial 877-407-0784 or 201-689-8560 approximately 5 to 10 minutes before the beginning of the call. Participants can also click the following link to obtain instant access to the event: https://callme.viavid.com/viavid/?callme=true&passcode=13743189&h=true&info=company&r=true&B=6 

The call will also be broadcast live over the Internet and can be accessed at: https://viavid.webcasts.com/starthere.jsp?ei=1648285&tp_key=6b45aa1cf4

The teleconference replay will be available by dialing 844-512-2921 or 412-317-6671, referencing conference ID 13743189, three hours after the end of the event, until Friday, December 29, 2023, at 11:59 PM ET.

About Pineapple Financial Inc.

Pineapple is a leader in the Canadian mortgage industry, breaking the mould by focusing on both the long-term success of agents and brokerages, as well as the overall experience of homeowners. With approximately 600 brokers within the network, Pineapple creates cutting-edge cloud-based tools and AI-driven systems to enable its brokers to help Canadians realize their ultimate 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. 

Safe Harbor Forward-Looking Statements

Certain statements in this announcement are forward-looking statements. 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. 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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Related Links:

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Pineapple Financial Inc. Consolidated Balance Sheets (Expressed in US Dollars)
				August 31, 2023				August 31, 2022
As at:
Assets
Current assets
Cash				$	720,365			$	3,896,839
Trade and other receivables		Note 13			758,988				33,119
Prepaid expenses and deposits					218,150				483,695
Income tax receivable					-				71,078
Total current assets					1,697,503				4,484,731
Investments		Note 4			10,013				38,211
Right-of-use asset		Note 11			960,377				954,091
Property and equipment		Note 5			242,091				247,665
Intangible assets		Note 6			1,718,954				702,388
Total Assets				$	4,628,938			$	6,427,086
Liabilities and Shareholders' Equity
Current liabilities
Accounts payable and accrued liabilities				$	605,319			$	780,113
Loan		Note 17			430,098
Current portion of lease liability		Note 11			138,372				2,024
Total current liabilities					1,173,789				782,137
Deferred government grant		Note 13			699,627
Lease liability		Note 11			969,589				1,018,561
Total liabilities				$	2,843,005			$	1,800,698
Shareholders' Equity
Common shares, no par value; unlimited authorized; 6,306,979 issued and outstanding as of August 31, 2023 and 2022		Note 7			4,903,031				4,903,031
Additional paid-in capital		Note 8,9			2,955,944				2,922,853
Accumulated other comprehensive loss					(417,727)				(353,218)
Accumulated deficit					(5,655,315)				(2,846,278)
Total stockholders' equity					1,785,933				4,626,388
TOTAL LIABILITIES AND STOCKHOLDERS'				$	4,628,938			$	6,427,086

Description of business (note 1)
Contingencies and commitments (note 18)
Subsequent events (note 19)

Approved on behalf of Board of Directors

"Shubha Dasgupta"

"Drew Green"

Pineapple Financial Inc. Consolidated Statements of Operations and Comprehensive Loss (Expressed in US Dollars)
For the year ended:				August 31, 2023				August 31, 2022
Net Revenue		Note 16		$	2,502,264			$	3,600,851
Expenses
Selling, general and administrative		Note 12			3,014,945				2,977,277
Salaries, wages and benefits					2,330,127				2,360,344
Interest expense and bank charges					56,316				94,202
Depreciation		Notes 5,6,11			441,159				255,871
Share-based compensation		Note 9			33,091				723,217
Government based incentive		Note 13			(591,480)				-
Total expenses				$	5,284,158			$	6,410,911
Loss from operations
Writedown of investment		Note 4			(27,143)				-
Loss before income taxes				$	(2,809,037)			$	(2,810,061)
Income taxes (recovery) expense		Note 10			-				-
Net loss					(2,809,037)				(2,810,061)
Foreign currency translation adjustment					(64,509)				(205,223)
Net loss and comprehensive loss				$	(2,873,546)			$	(3,015,284)
Loss per share - basic and diluted ($)				$	(0.45)				(0.45)
Weighted average number of common shares outstanding - basic and diluted					6,306,979				6,306,97	9

The accompanying notes are an integral part of these consolidated financial statements.

SOURCE Pineapple Financial Inc.

Media Contact: For media inquiries, please contact, Dennis Welsh, Senior Director of Marketing, at Pineapple, Email: [email protected]; Investor Relations Contact: For investor relations inquiries, please contact Scott Powell, Chief Executive Officer, at Skyline Corporate Communications Group, LLC, Email: [email protected], Phone: [phone]