OneSoft Solutions Inc. Reports Q2 2023 Results for Fiscal 2023 - Seite 2

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REVIEW OF FISCAL 2023 GUIDANCE

Further to the Company's Fiscal 2023 guidance stated in a news release issued on January 24, 2023, the Company advises its progress for the first six months of Fiscal 2023 is as follows.

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• Revenue was $4.7 million in H1 2023 and Management is not changing its revenue guidance for forecasted 2023 revenue at this time.
• Management reiterates its gross profit guidance of $7.6 million in Fiscal 2023 as forecasted.
• The Company plans to increase its development staff, which will increase previously forecasted expenses in the second half of Fiscal 2023 and may negatively impact the forecasted Net Loss and Adjusted EBITDA figures. Please refer to the Business Update section in the Q2 2023 MD&A filed at SEDAR for details in this regard.
• The following table states forecasted cash and deferred revenue balances as at December 31, 2023 and actual values as at June 30, 2023. Management believes the Fiscal 2023 forecasted figures will be achieved.

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CIM Use and Revenue Generating Data-Miles

The following table estimates the miles of customers' pipelines operated, miles that are subject to multi-year SaaS agreements and miles of pipeline data ingested into CIM for which revenue was earned ("data-miles").

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^{Note 1:} The revenue per mile for revenue generating miles includes CIM revenue only and excludes IM Operations revenue.

BUSINESS UPDATE

Fiscal 2023 Business Plan Pivot

Dialogue with existing customers and sales activities with certain North American and international pipeline companies continues to expose new opportunities for the Company to develop additional functionality and products that can potentially drive new sales and increase future revenues. The Company's Management and Board of Directors met for strategic planning sessions during Q2 2023 to explore alternatives to: (a) identify and assess revenue growth opportunities; (b) ensure the Company continues to retain its technological leadership; and (c) strengthen its competitive moat. Certain decisions made at these sessions will alter part of the business plan that was considered to estimate the January 24, 2023 guidance. Management believes functionality enhancements and additions continue to build and strengthen our competitive moat, encourage customer loyalty and contribute to customer "stickiness". We believe that providing the full complement of SaaS functionality requested by customers will preclude our customers from engaging with potentially competitive software vendors. Accordingly, a decision was made to increase technology and product development resources, which will result in increased expenses in Fiscal 2023 and potentially increased net loss and EBITDA deficit, depending upon the volume of new sales that will be completed in the last half of 2023.