Tenet Fintech Group (PKK) Q2 2024 earnings summary

Executive summary

• Networking and advertising modules for the platform are set for a soft launch to existing members by end of September 2024, with a full launch following a brief test period; ie-Pulse data products are expected to be ready for sale during the fourth quarter of 2024.

• Transitioning from a China-focused transaction fee model to a global data-driven subscription model, leveraging proprietary SME data through the Cubeler Business Hub.

• Launching ie-Pulse for market professionals and Equity Insider for self-directed investors, both powered by real-time SME data and analytics.

• Revenue for Q2 2024 was $713,943, with a net loss of $13,451,547 and EBITDA of ($10,685,055); six-month revenue was $1,479,578, down sharply from $26,270,518 in the same period last year.

• China remains a key part of future plans, leveraging partnerships and accumulated data to connect Canadian and US small businesses to the Chinese market.

Financial highlights

• Revenue in FY 2023 was $42.08M CAD, expected to rise to $117.92M in FY 2024, then stabilize around $32.74M by FY 2026 as the business model shifts.

• Net loss of $78.33M in FY 2023, with a forecasted return to positive net income by Q4 2025 as gross margins improve.

• EBITDA was -$68.05M in FY 2023, projected to improve to $7.38M in FY 2025 and $75.04M in FY 2026.

• Q2 2024 revenue: $713,943, compared to $16,776,714 in Q2 2023; net loss for Q2 2024: $13,451,547, compared to $6,453,557 in Q2 2023.

• Adjusted EBITDA for FY 2023 was -$24.6M, reflecting significant impairments and non-recurring items.

Outlook and guidance

• Expansion of the business hub to the US is still possible by year-end, pending regulatory compliance for the financing module.

• Aiming to relist on the OTCQB soon, with NASDAQ relisting targeted for the first quarter of 2025, subject to regulatory processes.

• Expects China to account for less than 12% of revenue in 2025 and under 5% by 2026, with most revenue shifting to subscription-based products.

• Launch of Business Hub's Networking and Advertising modules in Canada rescheduled to end of Q3 2024 to ensure positive user experience and strategic marketing alignment.

• Forecasts positive net income and significant EBITDA growth as the subscription model scales.