Kontrol Energy Announces Record Fourth-Quarter and Full Year 2018 Financial Results

Q4 Revenue Growth of 100% Year over Year

TORONTO, ON / April 30, 2019 / Kontrol Energy Corp. (CSE: KNROTCQB: KNRLFFSE:1K8) ("Kontrol" or 'Company') a leader in the energy efficiency sector through IoT, Cloud and SaaS technology announces its fiscal 2018 financial results for the year ended December 31, 2018.

A complete set of Financial Statements and Management's Discussion & Analysis will be filed on SEDAR (www.sedar.com) on April 30th at 4:30pm (EST). A conference call to discuss the 2018 financial results has been scheduled for April 30th at 4:30pm (EST).

2018 Highlights

  • Revenue for the year ending December 31, 2018 was $10.7 million, up 56% over the prior year

  • Revenue for fourth quarter was $4.1 million, up 100% over the comparable quarter of the prior year

  • Kontrol Energy and Toyota Tsusho Canada Inc. announce a Smart Factory Strategic Partnership for North American Markets

  • Acquisition of CEM Specialties Inc.

  • Asset acquisition of MCW Dimax Ltd.

  • Kontrol Energy expansion of IoT Technology solutions to Global Asset and Facilities Management

  • Letter of Intent executed for a $6.5M revenue and $700K in EBITDA electrical efficiency company

  • Private placement funding and exchange of debentures; holders of up to $5,245,000 can exchange their 2019 debentures for 2020 debentures bearing interest at 8% per annum

  • U.S. Listing granted on OTCQB Market under symbol KNRLF

  • Kontrol Energy enters global market with the launch of SmartMax® Energy Gateway

  • Launch of SmartSuite® energy management technology for global commercial, multi-residential, and hospitality real estate market

Management Commentary

'2018 was an important year of growth for Kontrol. In addition to delivering strong year over year revenue growth, we achieved record revenues in our Q4 2018 of $4.1 million and positive adjusted EBITDA," said Paul Ghezzi, CEO of Kontrol Energy. "We exit 2018 with a revenue run rate of $16 million annualized. With our continued organic growth and next acquisition target announced we look forward to a robust fiscal 2019."

Revenue

Revenue for the year ended December 31, 2018 was $10,727,301, an increase of $3.8 million or 56% over the comparative year. Revenue for the fourth quarter was $4,095,070, up 100% over the comparable quarter of the prior year. The growth in revenue is from a combination of accretive acquisitions and organic growth.

Gross profit

Gross profit for the year ended December 31, 2018 was $6,419,819 an increase of $1.8 million over the comparative year. Gross profit for the quarter was $1,960,103 compared to $1,355,107 for the fourth quarter of the prior year.

Gross margin for the year ended December 31, 2018 and fourth quarter was 60% and 48% respectively which is a decline from the mid 60% range for the comparable periods. This was expected by management and simply reflects the adjusted mix of revenue and cost of sales under a growing organization with changing product and service offerings. The fourth quarter gross margin is a more accurate representation of future periods. However, the gross margin will continue to change as new acquisitions are completed. On a dollar basis, the 2018 gross profit reflects strong contributions from newly acquired businesses.

Adjusted EBITDA

Adjusted EBITDA for the year ended December 31, 2018 was negative $(167,572) compared to 
$30,404 for the prior year. Adjusted EBITDA for the quarter was $200,685 compared to negative $(43,737) for the fourth quarter of the prior year.

The improvement in earnings in the fourth quarter reflects new business activities coming online from the completed 2018 acquisitions along with organic growth.

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* Adjusted EBITDA is a non-IRFS financial measure. The Company defines Adjusted EBITDA as net income or loss before interest, income taxes, amortization and depreciation, share based compensation, and acquisition related expenses

About Kontrol Energy

Kontrol Energy Corp. (CSE: KNR) (OTCQB: KNRLF) (FSE: 1K8) is a leader in the energy efficiency sector through IoT, Cloud and SaaS technology. With a disciplined mergers and acquisition strategy, combined with organic growth, Kontrol Energy Corp. provides market-based energy solutions to our customers designed to reduce their overall cost of energy while providing a corresponding reduction in greenhouse gas (GHG) emissions.

Kontrol Energy was recently announced as the 7th fastest growing Startup in Canada by Canadian Business and Maclean's.

Additional information about Kontrol Energy Corp. can be found on its website at www.kontrolenergy.com and by reviewing its profile on SEDAR at www.sedar.com

For further information, contact us a tadmin@kontrolenergy.com
Kontrol Energy Corp.
180 Jardin Drive, Unit 9
Vaughan, ON
L4K 1X8

Tel: 905.766.0400
Toll free: 1.844.566.8123

For further information, contact:

Paul Ghezzi, Chief Executive Officer
paul@kontrolenergy.com 
Kontrol Energy Corp., 
180 Jardin Drive, Unit 9, Vaughan, ON L4K 1X8 
Tel: 905.766.0400, Toll free: 1.844.566.8123

Neither IIROC nor any stock exchange or other securities regulatory authority accepts responsibility for the adequacy or accuracy of this release.

Forward-Looking Information

Certain information included in this press release, including information relating to future financial or operating performance and other statements that express the expectations of management or estimates of future performance constitute "forward-looking statements". Such forward-looking statements include, without limitation, statements regarding possible future acquisitions and/or investments in operating businesses and/or technologies, accelerated organic growth, Adjusted EBITDA, expansion of smart energy technologies into US markets, strategic partnerships to expand into North American Markets, acceleration of recurring SaaS revenues, the provision of solutions to customers and Greenhouse Gas emissions reductions, proposed financial savings and sustainable energy benefits and energy monitoring. Where the Company expresses or implies an expectation or belief as to future events or results, such expectation or belief are based on assumptions made in good faith and believed to have a reasonable basis. Such assumptions include, without limitation, that suitable businesses and technologies for acquisition and/or investment will be available, that such acquisitions and or investment transactions will be concluded, that sufficient capital will be available to the Company, that technology will be as effective as anticipated, that organic growth will occur, and others. 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, lack of acquisition and investment opportunities or that such opportunities may not be concluded on reasonable terms, or at all, that sufficient capital and financing cannot be obtained on reasonable terms, or at all, that technologies will not prove as effective as expected that 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 the Company 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, except as required under applicable securities law.

Rody Lazar