Pineapple Financial Inc. Announces Fiscal 2024 First Quarter Results

Company Projects Profitability in Fiscal 2024

TORONTO, Jan. 16, 2024 /PRNewswire/ - 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 2024 first-quarter ended November 30, 2023 results. 

Financial Performance Amidst Market Challenges
In the face of highly challenging market conditions in the Canadian mortgage landscape, including persistently high-interest rates and suppressed consumer sentiment, Pineapple Financial Inc., nevertheless continued to grow its user base and market share.  Though experiencing a revenue decline in the first quarter of fiscal 2024, Pineapple Financial showcased its ability to adapt and thrive in a dynamic environment.

Strengthened Liquidity Position:
During Q1 of fiscal 2024, Pineapple increased its unrestricted cash, trade and other receivables, and prepaid expenses and deposits by $1.721 million, bringing its total by the end of the quarter to $3.419 million. 

Net Revenue:
Facing market headwinds, Pineapple closed this quarter with net revenue of $0.569 million, a decrease of 36.17% from the previous fiscal year's quarter. This decrease stems from Canadian mortgage borrowers, faced with high-interest rates, preferring to take shorter than typical term mortgages, resulting in lesser revenue from lenders in turn lower revenue to Pineapple. Opting for these shorter 1 to 3-year mortgage terms allows borrowers to refinance mortgages earlier, providing potential relief should rates come down. Importantly, however, this approach positions Pineapple to significantly grow revenue in the next 1 to 3 years by concentrating on this customer base. 

Net Loss:
Net loss for the fiscal 2024 first quarter period was $0.898 million, or $(.14) per share, as compared to $0.762 million, or $(.12) per share for the previous fiscal year period.

Adjusted EBITDA Management:
The company's adjusted EBITDA loss during Q1 of Fiscal 2024 stood at $0.609 million, a moderate increase from $0.517 million in the previous corresponding period. This demonstrates its disciplined approach to managing financial metrics, optimizing resources, and maintaining operational efficiency during challenging times.

Streamlined Operational Expenses:
Pineapple Financial achieved a significant milestone in the reduction of selling, general, and administrative expenses by 19.95%, totaling $0.560 million compared to $0.700 million in the previous corresponding quarter. This disciplined cost management reflects our commitment to operational efficiency and sustained growth.

Employee Cost Optimization:
Salaries, wages, and benefits decreased to $0.644 million, representing a 1.98% reduction compared to the corresponding previous quarter ended November 30, 2022.

Prudent Mortgage Portfolio Management:
In navigating the intricate mortgage market, Pineapple Financial recorded a total mortgage volume of $381.987 million during the first quarter of fiscal 2024, representing a minor decrease of 1.24% compared to the same period in fiscal 2023.

"Despite facing adverse economic conditions during our first fiscal quarter, Pineapple has continued to progress by adding market share, continuing to increase our technology presence, expanding our user base, and growing our geographic presence. We believe, based on this progress, as well as decreasing interest rates, and improved consumer sentiment that Pineapple will demonstrate improved top and bottom line performance with each remaining quarter this fiscal year.

We therefore project significant top-line growth and profitability in fiscal 2024." said Shubha Dasgupta, Co-Founder and Chief Executive Officer.

Business Highlights and Recent Updates
During the first fiscal quarter of 2024, Pineapple Financial achieved several significant milestones and shared important updates:

NYSE American Listing and IPO Success:
On November 1, 2023, Pineapple Financial made history by becoming the first Canadian mortgage fintech company to commence trading on the NYSE American. This landmark event was swiftly followed by the successful closure of its Initial Public Offering, generating gross proceeds of $3.5 million. These funds bolster our strategic initiatives and position the company for continued growth in the dynamic mortgage landscape.

Broker Expansion:
In this fiscal quarter, Pineapple experienced robust user growth, welcoming 64 new brokers. This increase represents a 10% expansion of our user base, elevating the total count to 700. Notably, among the newly added users, Pineapple gained the valuable expertise of industry-seasoned professionals, some of whom have contributed to significant volume increases exceeding $100,000,000. This upward trajectory in user acquisition underscores Pineapple's appeal and value proposition within the market, reinforcing our commitment to fostering a diverse and influential user community.

Strategic Investor Relations Partnership:
Recognizing the importance of transparent and effective communication with our stakeholders, on November 13, 2023, Pineapple announced a strategic partnership with Skyline Corporate Communications Group, LLC. This collaboration enhances our investor relations and corporate communications activities, ensuring a broader and more compelling narrative within financial and investor communities. 

Globe and Mail Recognition:
Pineapple Financial proudly secured the 27th position on the Globe and Mail 2023 Listing of Canada's fastest-growing companies. With an impressive three-year growth rate of 1,452%, this recognition underscores our robust performance and establishes Pineapple as a key player in the Canadian mortgage industry. 

Strategic Expansion in Metro Vancouver:
Since the end of our fiscal first quarter, Pineapple Financial expanded its geographical reach by opening an office in Metro Vancouver, British Columbia. This strategic move is anticipated to yield a 10% increase in gross revenue, driven by an ambitious projection of $225 million in new mortgage origination over the next twelve months. 

Innovative Online Application System:
On December 1, 2023, Pineapple Financial introduced a cutting-edge online application system, revolutionizing the mortgage application process. This innovation empowers borrowers to swiftly determine their affordable mortgage amount and receive pre-qualification within minutes. 

Strategic Presence in Ottawa:
Expanding our footprint further, Pineapple Financial opened an office in Ottawa, Canada's capital, on December 21, 2023. This strategic move positions us to leverage the vibrant market in Ottawa, contributing significantly to our overall growth strategy and bottom line. 

Participation in Multiple Small and Micro-Cap Investor Conferences:
Since the end of our first fiscal quarter, PIneapple has presented at several notable industry and investment conferences: 

Harvard Investor Club:

• December 1, 2023
• January 11, 2024

Noble Con19:

• December 4-5, 2023

Sidoti Conference:

• December 6-7, 2023

Moneyball Event:

• December 11, 2023

Visit our website to see upcoming conference participation.  

These achievements collectively highlight Pineapple Financial's commitment to innovation, strategic expansion, and creating long-term value for our shareholders. We look forward to continued success and growth in the evolving landscape of the Canadian mortgage industry.

Pineapple Financial Inc. 
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Pineapple Financial Inc. 
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Pineapple Financial Inc.
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Reconciliation of Adjusted Revenue to Total Revenue, net 

Reconciliation of Adjusted Net (Loss) Income to Net Income Attributable to Pineapple Financial Inc.

About Pineapple Financial Inc.

Pineapple Financial Inc. is an award-winning fintech and leading Canadian mortgage brokerage network,  focusing on both the long-term success of agents and brokerages, as well as the overall experience of homeowners. With approximately 700 brokers within the network, Pineapple creates cutting-edge cloud-based tools and AI-driven systems to enable its brokers to help Canadians realize their 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.

Forward-Looking Statements

Certain statements in this announcement are forward-looking statements, including, but not limited to, the Company's proposed Offering. 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, including the expectation that the Offering will be successfully completed. 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:

https://gopineapple.com 

http://empoweredbypineapple.com 

SOURCE Pineapple Financial Inc.