Gorilla Technology Group Inc. Reports First Half 2022

TAIPEI, Taiwan and NEW YORK, Oct. 06, 2022 (GLOBE NEWSWIRE) — Gorilla Technology Group Inc. (NASDAQ: “GRRR” for strange shares and “GRRRW” for warrants) (“Gorilla” or the “Company”), a worldwide chief in edge video analytic synthetic intelligence, IoT applied sciences, and cybersecurity, in the present day reported its unaudited monetary outcomes for the half yr ended June 30, 2022.

1H22 Highlights:

• Strategic pivot to Security Convergence gaining traction, with phase income up 63.9% y/y; contributing 49.8% of whole group income, versus 27.8% within the first half of 2021
• Pivot away from Video IoT as anticipated, with phase income decreased 36.5% y/y as tasks are accomplished
• First half of 2022 gross margin improved 106 foundation factors (bps) to 33.1% when in comparison with the primary half of 2021, led primarily by greater gross margin of the Video IoT phase pushed by better service gross sales
• Progress in constructing world-class administration group with appointment of Dr. Rajesh Natarajan as Chief Innovation Officer
• Adjusted EBITDA (non-GAAP monetary measure) loss was lowered to $1.2 million from $1.5 million when in comparison with the identical interval a yr in the past
• Net lack of $8.6 million in comparison with a internet lack of $5.8 million from identical interval a yr in the past

Subsequent Events:

• Closed business mixture with Global SPAC Partners Co., turning into publicly traded and elevating roughly $45 million in gross funding
• Appointed Daphne Huang as Chief Financial Officer
• Announced retirement of founder, Dr. Spincer Koh
• Chairman Jay Chandan appointed as Chief Executive Officer in addition to persevering with as Chairman of the Board of Directors

Jay Chandan, Gorilla’s Chairman and CEO, commented, “We are excited to update our investors in this first earnings report as a public company. As a leader in Edge computing—which sits at the intersection of AI, IoT, and Big Data—with significant exposure to the rapid growth of Smart Cities, we believe our Nasdaq listing improves our ability to attract the attention of customers and investors alike and provide us with capital markets access to execute our global expansion strategy more rapidly.”

Mr. Chandan continued, “We are making rapid progress on many fronts. Most importantly, the business combination with Global SPAC Partners Co. brought us significant capital to fund operations as we execute a strategic shift to pursue the larger and higher margin opportunities in Security Convergence. We are using the funding to build a world-class management team, with our recent additions of new Chief Innovation and Chief Financial officers, a head of global human resources, and more to come.”

Commenting on outcomes, Mr. Chandan famous, “We are pleased to see explosive growth in the Security Convergence segment, which is now approximately half of our total revenue. Although we are de-emphasizing Video IoT, within this segment we were able to drive a mix shift to more software, which boosted gross margin substantially, and offset supply chain-related hardware cost pressure in Security Convergence. Operating expenses are under control, growing only slightly versus last year after removing the effect of one-time transaction costs. The net is a modest drawdown of cash when looking at operating cash flows and adjusted EBITDA. Our new business bookings in 2022 remain healthy with approximately $20 million new project wins as of end of August. With substantial momentum building in the Smart Cities offering, we expect to swing to profit in the quarters ahead.”

Looking ahead, Mr. Chandan concluded, “Looking toward the year ahead, we have four immediate priorities. First, to build a world-class customer-centric team responsible for commercializing Gorilla’s technologies. Second, to globalize the Company by bringing our technologies to the countries that are leading the world in Smart City adoption. Third, to build a robust sales pipeline that will complement our existing products and services, with a special focus on secure surveillance solutions. Finally, to transform our business away from a cost-plus system integrator model and toward a value-based sales model that is rewarded for long-term customer partnership and retention.”

First Half Results Reflect Strategic Shift to Security Convergence

Unless famous in any other case, all figures are for the six months ended June 30, 2022, and all comparisons are with the corresponding interval of 2021.

Revenues declined 8.6% to $13.8 million, in comparison with $15.1 million within the prior yr interval. Revenue from each current and new clients decreased as many tasks neared completion within the second half of 2021, leaving a smaller quantity of income to be acknowledged within the present interval. This income decline is a operate of the Company’s strategic shift towards safety convergence and away from video IoT. The Company expects this strategic shift to allow it to pursue bigger tasks with wholesome gross margins.

Security Convergence phase income grew 63.9% to $6.9 million, whereas a lower in {hardware} and software program gross sales within the Video IoT phase led to a 36.5% lower in phase revenues to $6.9 million.

Gross revenue was $4.6 million, in comparison with $4.8 million a yr in the past. Gross margin expanded by 106 bps to 33.1% versus 32.1% within the year-ago interval, pushed primarily by higher margins within the Video IoT phase as clients demanded extra companies and fewer {hardware} and software program. Video IoT phase gross margin of 36.2% elevated by 398 bps versus final yr. In distinction, the Security Convergence phase gross margin decreased by 163 bps to 30.0% as supply-chain constraints resulted in greater {hardware} prices from distributors.

Operating bills have been up 18.1% to $12.4 million, reflecting a pointy 235.2% enhance generally and administrative bills. G&A expense progress was primarily as a result of $2.2 million {of professional} bills incurred for the general public itemizing.

Net loss expanded by 48.2% to $8.6 million, in contrast with $5.8 million final yr. The better loss was brought about primarily by the $2.2 million of transaction prices. However, internet money utilized in working actions was roughly $3.8 million, in comparison with $4.9 million within the prior interval. The major elements affecting working money flows between these intervals have been negatively impacted by will increase in accounts receivable and prepayments made to distributors, whereas benefited from enhance in accounts payable and different payables.

Adjusted EBITDA loss was lowered to $1.2 million from $1.5 million a yr in the past. Please see “Reconciliation of Non-GAAP Financial Measures – Adjusted EBITDA Calculation (Unaudited)”, because it pertains to adjusted EBITDA.

Balance Sheet and Cash Flow Review

As of June 30, 2022, money and money equivalents have been $5.6 million as of June 30, 2022, down $4.4 million when in comparison with December 31, 2021. Financial belongings (restricted money and time deposits with maturity over three months) as of June 30, 2022, was $6.8 million.

The business mixture with Global SPAC Partners Co. that closed in July 2022 added roughly internet $32 million of money (gross funding much less transaction bills) on the business mixture cut-off date, to the steadiness sheet, which shall be mirrored within the upcoming reporting interval.

Capital expenditures have been $2.8 million in contrast with $2.3 million within the prior-year interval.

About Gorilla Technologies Group Inc.

Gorilla, headquartered in Taipei, Taiwan, is a worldwide chief in safety intelligence, community intelligence, business intelligence and IoT expertise. Gorilla develops a variety of options together with Smart Cities, Smart Retail, Enterprise Security, and Smart Media. In addition, Gorilla offers an entire Security Convergence Platform to authorities establishments, Telecom corporations and personal enterprises with community surveillance and cyber safety.

Gorilla locations an emphasis on providing main expertise, knowledgeable service, and exact supply, and guaranteeing top-of-the-line, clever and robust Edge AI options that allow shoppers to enhance operational efficiency and effectivity. With steady core expertise growth, Gorilla will ship Edge AI options to managed service suppliers, distributors, system integrators, and {hardware} producers.
Gorilla-Technology.com

Forward-Looking Statements

This press launch accommodates “forward-looking statements” inside the which means of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Gorilla’s precise outcomes might differ from its expectations, estimates and projections and consequently, you shouldn’t depend on these forward-looking statements as predictions of future occasions. Words resembling “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believes,” “predicts,” “potential,” “might” and “continues,” and comparable expressions are meant to establish such forward-looking statements. These forward-looking statements embrace, with out limitation, statements concerning our Nasdaq itemizing bettering our capacity to draw the eye of consumers and buyers alike, our capacity to fund operations as we execute a strategic shift to pursue the bigger and better margin alternatives in Security Convergence, our expectations to swing to revenue within the quarters forward, our quick priorities, Gorilla’s strategic shift to allow it to pursue bigger tasks with greater gross margins, together with these different dangers described underneath the heading “Risk Factors” within the prospectus Gorilla filed with the Securities and Exchange Commission (the “SEC”) on July 7, 2022, and people which are included in any of Gorilla’s future filings with the SEC. These forward-looking statements contain important dangers and uncertainties that might trigger precise outcomes to vary materially from anticipated outcomes. Most of those elements are exterior of the management of Gorilla and are tough to foretell. Should a number of of those dangers or uncertainties materialize, or ought to underlying assumptions show incorrect, precise outcomes might differ materially from these indicated or anticipated by such forward-looking statements. Readers are cautioned to not place undue reliance upon any forward-looking statements, which communicate solely as of the date made. Gorilla undertakes no obligation to replace forward-looking statements to replicate occasions or circumstances after the date they have been made besides as required by legislation or relevant regulation.

Non-GAAP Measures

Certain of the measures included on this press launch are non-GAAP monetary measures, together with adjusted EBITDA. Non-GAAP monetary measures shouldn’t be thought of in isolation from, or as an alternative to, monetary data introduced in compliance with GAAP, and non-GAAP monetary measures as utilized by Gorilla will not be reported by all of their rivals and is probably not similar to equally titled quantities utilized by different corporations.

Contacts

Gorilla Technologies Group, Inc.
Peter Wright
+1-617-454-1088
[email protected]

__________________________
¹ This is a non-GAAP monetary measurement.