Gorilla Technology Group Inc.

Good day, ladies and gentlemen. Thank you for standing by. And welcome to the Gorilla Technology Group nine months ended September 30th, 2023 earnings conference call. Currently, all participants are in listen-only mode. As a reminder, we are recording today's call. If you have any objections, you may disconnect at this time. Now, I'll turn the call over to Mr. Cody Fletcher of the Blue Shirt Group. Mr. Fletcher, please go ahead.

Good morning, everyone. Thank you for joining us on today's call to discuss financial results for the first nine months of 2023. We released results pre-market yesterday, and the release is available on our website, as well as from Newswire Services. With me on the call are Jay Shandon, our Chief Executive Officer, and Daphne Wang, our Chief Financial Officer. Jay and Daphne will make prepared remarks, and then any questions you have you may reach out to us at guerrillair at blueshirtgroup.com, and we will respond to your questions as soon as we have received them. Before we get started, I would like to note that certain statements made during this conference call that are not historical facts, including those regarding our plans, objectives, growth, and expected performance, including our outlook for the fiscal year 2023 and 2024, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are our outlook only as of the date of this call. While we believe any forward-looking statements we make are reasonable, actual results could differ materially because the statements are based on current expectations and are subject to risks and uncertainties. We do not undertake and expressly disclaim any obligation to update or alter our forward-looking statements, whether because of added information, future events, or otherwise. Further information on these and other factors that could affect the company's financial results is included in filings we make with the SEC from time to time, including the section titled Risk Factors in the company's Form 20F, previously filed with the SEC. Additionally, unless otherwise stated, all financial measures excluding revenue discussed on this call will be non-IFRS. The financial statements have not been audited or reviewed by our auditors. With that, let me now turn the call over to Jay Shaman. Jay?

Thank you very much, Cody. Good morning, everybody. As always, and with even greater enthusiasm than before, I'm delighted to be addressing you today. In the world of business, innovation isn't just an advantage. It is the lifeline that keeps us ahead of the curve, driving us beyond the competition. Since our listing in 2022, we have embraced this ethos as we've embarked on a transformative journey, navigating challenges, seizing opportunities, and steering towards unparalleled success. Over the last nine months of 2023, Gorilla did not just sustain, but it accelerated its momentum, evolving our technology platform known for its broad applicability into an even more potent force. Now, we continue to leverage this robust foundation, aiming to amplify Gorilla's international presence and enrich its ecosystem further. Our global footprint has expanded significantly with our teams across the globe synergizing to elevate our customers' capabilities and experience. Let me highlight some of our successes so far this year. First and foremost, we're expeditiously and efficiently working with various governments on smart city, safe city, responsible solutions driven by artificial intelligence, computer vision, IoT, and cloud computing. We're providing a full suite of services to support our customers while also discussing even greater future collaboration. Second, we are creating a whole new suite of products covering industry 4.0, agap networks, lawful interception, SOX, and business intelligence. We have built budding partnerships, strategic partnerships with Red Hat, MCS, Infosec for future endeavors, including maximizing our smart city platform across multiple different complex pain points for a myriad of customers. And I could go on, but you get the point. The key takeaway here is that we will never stop innovating and create fully customized solutions for our clients' needs. Now, rewind to mid-2022, Gorilla was a budding regional tech player with a keen eye on video analytics. Fast forward today, our ambition for Gorilla has materialized into reality. The post-IPO era saw us sculpting a world-class leadership team, relocating our headquarters to the UK, enhancing our sales networks globally, and refining our customer profile. Our product suite has grown exponentially, now encompassing cutting-edge solutions in cybersecurity and smart city infrastructure. Through the journey had its challenges, the thrill of progress made every hurdle worthwhile. The results we are witnessing are nothing short of spectacular, and it is with immense pride that we anticipate delivering continuous success to you, our esteemed shareholders. Now, admittedly, the road to excellence is paved with challenges. We charted significant process, progress, and more importantly, we also recognize the strides we still need to make to solidify our operations, R&D, and customer success. Turning our attention to the financial landscape, it is with immense pride that I report our performance for the first nine months of 2023. Our efforts have not just met our expectations, but believe they will have exceeded them, as it has been reflected in our financial milestones. Our revenue for the first nine-month period was an impressive $37.9 million, surging over 2x compared to the same period last year. This growth was driven by the tangible value of our IP-focused, high-value technical services business model. you can see the value as well as in our gross margin, which has more than doubled to 76.5% this year. Margins like this are not just a number. They are a testament to our relentless pursuit of excellence, innovation, and customer satisfaction. I'm also very proud to announce that our total sales signed in the first nine months have reached a staggering $300 million, which is about 441% about internal targets. This isn't merely a triumph of numbers. It's a narrative of unwavering dedication and tenacity of our leadership team and our sales teams. Our third quarter discounted revenue run rate is about $88 million, which sets us on a very confident path to meet or even exceed our full year revenue guidance for 2024. On top of these financial fees, our comprehensive income and adjusted EBITDA have witnessed astronomical growth, showcasing our commitment to driving profitability and delivering value to our shareholders. The leap from a comprehensive income of $7.2 million from negative figures last year to positive figures this year and with a 447% year-upon-year growth in adjusted EBITDA, are not just milestones. They're markers of our unwavering dedication to financial excellence and operational efficiency. Now, looking ahead, our vision is clear and our roadmap steadfast. We remain committed to sustainable growth, innovation, and customer centricity. With a sales pipeline exceeding $1 billion, our sites are not just set upon meeting targets, but to redefine them. The full year 2023 is poised to be a record-breaking year for Gorilla as we step into 2024. Our target of achieving at least $90 million in revenue stands as a testament to our relentless ambition and our collective prowess. In conclusion, our journey marked by innovation, strategic growth, and unwavering commitment to excellence continues to set new industry benchmarks. I extend my deepest gratitude to our shareholders for their continued trust, our employees for their unparalleled dedication, and our customers for their unwavering support. Together, we're not just charting a path, we're defining the future. Now, I'll hand over to Daphne, who will delve deeper into our year-to-date results. Thank you all. Daphne.

Thanks, Jay. And hello, everyone. I'm delighted to share our first nine-month results, especially highlighting some exciting milestones we achieved. First, let me draw your attention to our outstanding revenue growth. We're thrilled to report a 105% year-over-year increase from $18.5 million to close to $38 million. This remarkable achievement is due to the robust momentum generated by our capacity to deliver project progress on time. The dedication and hard work of our team have truly paid off. Our focus on operational efficiency and delivering high-value services was reflected in our gross profit, which grew nearly five times to over $29 million. This represents a gross margin of 76.5%, which is 43% higher than last year. To stay close to our clients and deliver the best and fastest response, we have established our global center for R&D and customer success in India, facilitating more cost-effective labor planning. We're all pleased that our EBITDA turned positive this year. Our adjusted EBITDA margin of 35% far surpassed our initial expectations. This achievement reflects our outstanding gross margin combined with disciplined operational efficiency. It is a significant milestone, marking our first earnings release with positive EBITDA since listing. Going forward, we're confident that we can sustain positive adjusted EBITDA as revenue continues to ramp and we remain disciplined in our cost controls. Regarding our financial position, I am pleased that we maintain a robust cash position with nearly $19 million in cash and around $40 million restricted cash on our balance sheet. This substantial liquidity not only grants us financial flexibility, but also positions us favorably to pursue new business opportunities and act boldly on strategic initiatives. A strong cash position equips us with increased negotiation power with vendors and clients to secure the most favorable terms possible. It also creates greater resilience to weather any unforeseen challenges. Looking ahead, our future looks promising. We have a robust new business pipeline. We have strategically positioned ourselves to capitalize on emerging opportunities setting the stage for sustained growth in the coming quarters. With contracts in place offering high visibility, we are reiterating revenue guidance for full year 2024 of 90 million. We also expect positive adjusted EBITDA for the year. That concludes our update. We'll now turn the call over back to Cody for closing. Cody?

Thank you, Daphne, and thank you, Jay, and thank you for all that are attending. If you have any questions, again, please contact us via the investor relations email, and we will get back to you right away. We hope you all have a great day. You may all now disconnect.