EMERGE Commerce (ECOM) Investor Update summary

Financial performance and growth

• Q2 revenue reached CAD 8.3 million, a 79% year-over-year increase, driven by the Tee 2 Green acquisition and organic growth.

• Adjusted EBITDA for Q2 is expected between CAD 900,000 and CAD 1 million, marking a significant positive swing year-over-year from a loss of CAD 132,000 in Q2 2024.

• Cash position at June 30th was CAD 3.5 million, up from CAD 2.7 million at the end of Q1 and CAD 2.2 million at June 30, 2024, despite a CAD 1.1 million outlay for Tee 2 Green.

• Debt has been reduced by over 80%, with current debt at CAD 7.2 million, positioning for potential refinancing at lower rates.

• Both grocery and golf verticals are experiencing double-digit organic growth, with strong cash flow generation.

Brand and portfolio highlights

• truLOCAL remains the flagship brand, leading the Canadian D2C meat and seafood subscription market with a CLTV approaching CAD 2,000 and CAC at CAD 124.

• The golf segment, including Tee 2 Green, Just Golf Stuff, and UnderPar, now represents 40-45% of the business.

• Tee 2 Green delivered CAD 3.3 million in Q2 revenue, up 34% year-over-year, and net income of CAD 800,000, up 41%.

• Early synergies from the Tee 2 Green acquisition include digital marketing success and cross-brand opportunities.

• Just Golf Stuff has grown 10x in five years, and UnderPar is seeing double-digit organic growth.

Strategic direction and acquisition criteria

• EMERGE 3.0 focuses on disciplined, strategic growth, centralization, and cash flow generation.

• Acquisition targets must have stable cash flow, recurring customer relationships, and EBITDA of CAD 1-2 million.

• Preference for buyer-friendly deals at 2-3x EBITDA, with immediate synergy potential and hands-on management.

• Interest in expanding truLOCAL through regional competitors, pet food, logistics, and corporate gifting verticals.

• Golf vertical aims to leverage existing brands and data for further tuck-in acquisitions and cross-selling.