Gorilla Technology Group Reports Results Through Third Quarter 2023

– Q3 revenues far exceeded total revenue of 2022 –
– High value Product driven & Services business model reflected in 76.5% gross margin –
– Won sales exceeded internal target of $68 million, standing at $300 million (a 441% increase) –
– Achieved discounted run rate revenues of $88 million in Q3 –
– Solid visibility with sales pipeline over $1 billion –

LONDON, Feb. 05, 2024 (GLOBE NEWSWIRE) — Gorilla Technology Group Inc. (“Gorilla”) (NASDAQ: GRRR), a global provider of AI-based edge video analytics, IoT technologies, and security convergence, today reported financial results for the nine months ending September 30, 2023.

YTD Highlights

  • Surging Revenue: Nine-month revenue of $37.9 million surged by over 2x versus the same period, last year.
  • High and Expanding Margin Reflects Value of Business Model: The robust 76.5% gross margin underscores Gorilla’s dynamic product-driven and services-oriented business model, a significant leap from the approximately 33% gross margin recorded in the previous year.
  • Bottom Line Focus: Achieved an impressive turnaround, with total comprehensive income soaring to $7.2 million, a remarkable improvement from last year’s comprehensive loss of ($86 million). This result underscores Gorilla’s unwavering commitment to boosting profitability at the bottom line. The adjusted EBITDA experienced an extraordinary surge, reaching $13.4 million, marking an outstanding 431% YoY increase compared to an EBITDA loss of ($4 million) for the same period last year.
  • Exceptional Visibility: With discounted run rate revenue over $88 million today, Gorilla affirms its target to achieve at least $90 million of revenue in 2024 and is on course to becoming cash flow positive. 

Gorilla Chief Executive Officer Jay Chandan commented, “I am absolutely thrilled to announce stellar earnings for the first nine months of 2023! We’ve not just met our numbers for Q3, but exceeded expectations, showcasing the incredible dedication and hard work of every member of our team. It’s not just about the numbers; it’s a testament to our shared commitment to excellence.

“Our revenue soared to new heights, and in fact our revenue this quarter far exceeded analyst expectations of $21.8 million. This is due to the success of our innovative strategies and unwavering customer focus. We’re not just navigating the market, we’re shaping it. Gross margin more than doubled versus last year due to our relentless pursuit of quality, creativity, and customer satisfaction. Furthermore, comprehensive net income and adjusted EBITDA soared, showcasing our commitment to benefiting shareholders by driving profitability to the bottom line.”

Chandan continued, “We’re not just achieving financial milestones—we’re forging a path of sustained growth and industry leadership. A heartfelt thank you to our dedicated team, loyal customers, and supportive stakeholders. With our momentum building, we are confident that the full year 2023 results are expected to meet prior guidance and that we are primed to achieve our target 2024 revenue of $90 million. We entered 2024 with a $1 billion sales pipeline. This sales pipeline is not just a numerical milestone, it is a testament to our dedication to pushing boundaries, exploring new opportunities, and providing unparalleled value to our clients. There is still plenty of work to be done to convert those leads into contracts and revenue, but my confidence in our team has never been greater.”

Chandan concluded, “Our dedication to judicious cost management has produced remarkable outcomes. We have streamlined our expenses without compromising the quality and efficiency of our operations, making a substantial contribution to our positive financial results. Our cash flow continues to be resilient, affording us the financial flexibility to explore additional project opportunities, invest in innovation, and navigate potential economic uncertainties. Looking forward, we hold an optimistic view of the future and persist in upholding the highest standards of financial stewardship. Our unwavering focus on innovation, operational excellence and customer satisfaction will remain the driving forces behind our ongoing success.”

Earnings Call

Earnings Call The Company will host a pre-recorded conference call on Tuesday, February 6, 2024 at 8:00 a.m. EST to discuss the Company’s financial results.

Webcast: https://edge.media-server.com/mmc/p/95an8tgp

Telephone: Click here to register and join the event. Upon registering, you will be emailed a dial-in number and unique PIN.

Third Quarter 2023 Results

Unless noted otherwise, all figures are for the nine months ended September 30, 2023, and all comparisons are with the corresponding period of 2022.

The following table summarizes financial results (unaudited and unreviewed):

    Nine months ended
September 30
Items   2023   2022
Revenue   $ 37,963,456     $ 18,481,617  
Cost of Revenue     (8,940,687 )     (12,354,340 )
Gross Profit     29,022,769       6,127,277  
Gross Margin     76.5 %     33.2 %
Operating Expense     (19,813,528 )     (90,189,301 )
Operating Income (Loss)     9,209,241       (84,062,024 )
Net Profit (Loss)   $ 6,901,573     $ (85,024,550 )

The following table shows our EBIT, EBITDA, and adjusted EBITDA, together reconciled to the net profit (loss) for the nine-month period ended September 30, 2023, and 2022.

  Nine months ended
September 30, 2023

    Nine months ended
September 30, 2022

Net Profit (Loss) $ 6,901,573     $ (85,024,550 )
Income tax expense   2,240,873       334,333  
Interest and Finance costs   66,795       628,193  
EBIT $ 9,209,241       (84,062,024 )
Depreciation expense   421,429       6,147,749  
Amortization expense   680,871       1,604,988  
EBITDA $ 10,311,541     $ (76,309,287 )
Transaction costs (one time)(1)   3,097,764       72,256,845  
Adjusted EBITDA   13,409,305       (4,052,442 )

(1) Transaction costs are one-off expenses for one-time employee expenses and professional services related to asset acquisition, professional services for one-time project which are considered as one-off corporate development events and added back for calculation of adjusted EBITDA. Transaction cost in nine months ended September 30, 2022 includes $70.1 million non-cash de-SPAC share listing expense.

Revenue for the nine months ended September 30, 2023, grew significantly as engagement with the country of Egypt has begun and is progressing on schedule. Adjusted EBITDA growth of 431% reflects technology service driven gross margin, aggressive expense control, and the absence of one-time transaction expenses related to the Nasdaq listing, which were the primary operating expenses of 2022.

The interim period financial statements for the first nine months of 2023 included herein have not been audited or reviewed by the Company’s independent registered accounting firm.

About Gorilla Technology Group Inc.

“Empowering Your Tomorrow”

Gorilla, headquartered in London U.K., is a global solution provider in Security Intelligence, Network Intelligence, Business Intelligence and IoT technology. Gorilla provides a wide range of solutions, including, Smart City, Network, Video, Security Convergence and IoT across select verticals of Government & Public Services, Manufacturing, Telecom, Retail, Transportation & Logistics, Healthcare and Education.

The Company’s vision is to empower a connected tomorrow through innovative and transformative technologies. Gorilla envisions a world where seamless connectivity transcends boundaries, enriching lives, industries, and societies.

Gorilla’s commitment is to lead the way in pioneering innovative solutions that bridge gaps, foster collaboration, and inspire progress. By relentlessly pushing the boundaries of technology, the Company aims to create an ecosystem where individuals, businesses and communities thrive in an era of digital empowerment.

Through continuous innovation, ethical practices and a steadfast dedication to quality, Gorilla strives to shape a future where every interaction, transaction, and experience is enhanced by the power of technology.

For more information go to Gorilla-Technology.com.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Gorilla’s actual results may differ from its expectations, estimates and projections and consequently, you should not rely on these forward-looking statements as predictions of future events. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believes,” “predicts,” “potential,” “might” and “continues,” and similar expressions are intended to identify such forward-looking statements. These forward-looking statements include, without limitation, statements regarding our beliefs about future revenues, our ability to attract the attention of customers and investors alike, our ability to fund operations as we execute a strategic shift to pursue the larger and higher margin opportunities in Security Convergence, our expectations to swing to profit in the quarters ahead, our immediate priorities, Gorilla’s strategic shift to enable it to pursue larger projects with better revenue visibility, Gorilla’s contract with the Government of Egypt, Gorilla’s ability to win additional projects and execute definitive contracts related thereto, along with those other risks described under the heading “Risk Factors” in the Form 20-F Gorilla filed with the Securities and Exchange Commission (the “SEC”) on April 28, 2023, those described under the heading “Risk Factors” in Exhibit 99.5 to the Form 6-K Gorilla filed with the SEC on August 17, 2023 and those that are included in any of Gorilla’s future filings with the SEC. These forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from expected results. Most of these factors are outside of the control of Gorilla and are difficult to predict. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated or anticipated by such forward-looking statements. Readers are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made. Gorilla undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date they were made except as required by law or applicable regulation.

Non-IFRS Measures

Certain of the measures included in this press release are non-IFRS financial measures, including adjusted EBITDA. Non-IFRS financial measures should not be considered in isolation from, or as a substitute for, financial information presented in compliance with IFRS, and non-IFRS financial measures as used by Gorilla are not reported by all their competitors and may not be comparable to similarly titled amounts used by other companies.

We believe that the non-IFRS measures such as adjusted EBITDA provide useful information about our core operating results, enhance the overall understanding of our past performance and prospects and allow for greater visibility with respect to key metrics used by our management in its financial and operational decision-making. We present adjusted EBITDA to provide more information and greater transparency to investors about our operating results.

Adjusted EBITDA represents EBITDA excluding transaction costs and share listing expenses which are one-off expenses for professional services related to our Business Combination, asset acquisition and SOX 404 implementation project, which are considered as non-recurring corporate development events and added back for calculation of adjusted EBITDA.

The final table which shows our EBIT, EBITDA, and adjusted EBITDA, together reconciled to the net profit (loss) for the periods ended September 30, 2023, and 2022 in this results announcement has more details on the non-IFRS financial measures and the related reconciliations between these financial measures.

Investor Relations Contact: 

Cody Fletcher 
The Blueshirt Group for Gorilla 
+1 (434) 251-7165 

Media Contact:
James McCusker
Canaan Parish Group Inc.
+1 (203) 585-4750

Gorilla Technology Group
Consolidated Balance Sheet
September 30, 2023 and 2022
(Expressed in USD)
Items   September 30, 2023
(Unaudited and Unreviewed)
  December 31, 2022
Current assets            
Cash and cash equivalents   $ 18,757,494     $ 22,996,377  
Financial assets at fair value through profit or loss – current     1,014,613       1,073,229  
Financial assets at amortized cost – current (restricted cash)     39,774,961       6,871,187  
Contract assets     9,578,119       725,441  
Accounts receivable     18,840,146       14,041,611  
Inventories     46,322       68,629  
Prepayments – current     1,048,575       1,266,442  
Other receivables     669,217       648,617  
Other current assets     31,030       61,803  
Total current assets     89,760,477       47,753,336  
Non-current assets            
Property, plant and equipment     15,138,075       16,132,567  
Right-of-use assets     6,396       16,675  
Intangible assets     8,907,133       56,342  
Deferred income tax assets     32,365       29,905  
Prepayments – non-current     353,612       612,982  
Other non-current assets     996,543       659,071  
Total non-current assets     25,434,124       17,507,542  
Total assets   $ 115,194,601     $ 65,260,878  
Items   September 30, 2023
(Unaudited and Unreviewed)
  December 31, 2022
Liabilities and Equity            
Current liabilities            
Short-term borrowings   $ 16,835,012     $ 13,492,935  
Contract liabilities     265,736       58,475  
Notes payable     574       602  
Accounts payable     7,210,756       6,674,528  
Other payables     9,108,295       3,620,998  
Provisions – current     76,432       88,469  
Lease liabilities – current     6,501       16,981  
Warrant liabilities     11,540,506       2,042,410  
Convertible Preference Shares Liabilities     13,384,346       0  
Long-term borrowings, current portion     1,601,806       2,108,896  
Other current liabilities, others     88,990       152,373  
Total current liabilities     60,118,954       28,256,667  
Non-current liabilities            
Long-term borrowings     6,993,180       8,251,788  
Provisions – non-current     72,496       61,057  
Deferred income tax liabilities     145,502       148,183  
Total non-current liabilities     7,211,178       8,461,028  
Total liabilities     67,330,132       36,717,695  
Equity attributable to owners of parent            
Share capital            
Ordinary share     7,646       7,136  
Capital surplus     167,450,030       154,730,389  
Retained earnings            
Accumulated deficit     (90,082,807 )     (96,984,380 )
Other equity interest            
Financial statements translation differences of foreign operations     69,740       370,178  
Treasury shares     (29,580,140 )     (29,580,140 )
Equity attributable to owners of the parent     47,864,469       28,543,183  
Total equity     47,864,469       28,543,183  
Significant contingent liabilities and unrecognized contract commitments            
Total liabilities and equity   $ 115,194,601     $ 65,260,878  

Gorilla Technology Group
Consolidated Income Statement
For the Period Ended September 30, 2023 and 2022
(Unaudited and Unreviewed)
(Expressed in USD)
    Nine months ended September 30
Items   2023     2022  
Revenue   $ 37,963,456     $ 18,481,617  
Cost of revenue     (8,940,687 )     (12,354,340 )
Gross profit     29,022,769       6,127,277  
Operating expenses            
Selling and marketing expenses     (1,224,888 )     (2,915,374 )
General and administrative expenses     (11,633,842 )     (5,319,841 )
Research and development expenses     (3,358,489 )     (11,261,954 )
Share listing expenses     0       (70,104,989 )
Other income     83,292       968,389  
Other gains (losses) – net     (3,679,601 )     (1,555,532 )
Total operating expenses     (19,813,528 )     (90,189,301 )
Operating income (loss)     9,209,241       (84,062,024 )
Non-operating income and expenses            
Interest income     524,738       33,199  
Finance costs     (591,533 )     (661,392 )
Total non-operating income and expenses   (66,795 )   (628,193 )
Profit (Loss) before income tax     9,142,446       (84,690,217 )
Income tax expense     (2,240,873 )     (334,333 )
Profit (Loss) for the period   $ 6,901,573     $ (85,024,550 )
Other comprehensive (loss) income            
Components of other comprehensive (loss) income that may be reclassified to profit or loss            
Exchange differences on translation of foreign operations   $ 300,438     $ (1,085,141 )
Other comprehensive income (loss) for the period, net of tax   $ 300,438     $ (1,085,141 )
Total comprehensive income (loss) for the period   $ 7,202,011     $ (86,109,691 )

Gorilla Technology Group Inc. and Subsidiaries
Reconciliation of Non-IFRS Financial Measures – Adjusted EBITDA Calculation
(Unaudited and Unreviewed)
(Expressed in USD)
Items   Nine months ended
September 30, 2023
  Nine months ended
September 30, 2022
Profit (Loss) for the period $ 6,901,573 $ (85,024,550 )
Depreciation Expense   421,429   6,147,749  
Amortization Expense   680,871   1,604,988  
Income Tax Expense (Benefit)   2,240,873   334,333  
Interest and Finance Costs   66,795   628,193  
Transaction Costs (one time)   3,097,764   72,256,845  
Adjusted EBITDA $ 13,409,305 $ (4,052,442 )

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