Trakopolis Announces Second Quarter Results

Trakopolis IoT Corp. ("

Trakopolis

" or the "

Company

") (TSXV: TRAK) is pleased to report its financial and operating results for the second quarter ended June 30, 2019.

"During Q2 2019 operational adjustments resulted in an 88% improvement to EBITDA compared with Q1 2018. We have been very pleased with the success and speed of the operating adjustments and the improvements made to EBITDA and net loss.  Recalibrating our overall strategy on opportunities where our competitive advantage is illustrated by existing customers positions the company to achieve our target of both operating profitability and continued growth of our customer base,” stated Brent Moore, CEO of Trakopolis. 

“Our ability to work with market leaders in different segments, combined with our customizable, hardware agnostic platform has allowed us to differentiate our services offering in the industrial internet of things market. Since the beginning of 2019 we have concentrated our efforts on utilizing our product/solution positioning, established customers and sales channels to drive improvements in top and bottom-line operating results.  We look forward to working with clients to deliver, comprehensive, end-to-end industrial internet of things solutions."

Second quarter financial highlights include:

• EBITDA of negative $0.1 million for the quarter which is an 88% improvement from Q2 in the prior year and a 76% improvement from the prior quarter.  
• An improvement in net loss of 72% for Q2 2019 compared to the prior year and a 59% improvement from the prior quarter.   
• Enterprise customer segment represents 57% of monthly subscription revenue up from 43% in Q2 2018.  
• Operating expenses declined by $0.8 million from $1.8 million in Q2 2018 to $1.0 million in Q2 2019.  
• Subscription sales of $1.21 million for the quarter ended June 30, 2019, representing a 4% increase from the same quarter in the prior year.

Extract from Management’s Discussion and Analysis (“MD&A”) for the three and six months ended June 30, 2019 – Quarterly Performance, page 16

	Q2 19	Q1 19	Q4 18	Q3 18	Q2 18	Q1 18	Q4 17	Q3 17
(in thousands)
Revenue
Subscription	1,209	1,179	1,141	1,174	1,168	1,213	1,158	988
Hardware and other	251	320	419	373	432	378	6663	3,6423
Total revenue	1,460	1,499	1,560	1,547	1,600	1,591	1,824	4,630
Gross profit	912	864	855	921	860	943	910	765
Gross margin	62%	58%	55%	60%	54%	59%	50%	17%
EBITDA1	(116)	(481)	(719)	(759)	(937)	(756)	(717)	(1,013)
Adjusted EBITDA1	(98)	(463)	(668)	(676)	(850)	(662)	(798)	(846)
Net Loss	(311)	(754)	(1,058)4	(810)	(1,100)	(1,275)	(916)2	(1,192)

Trakopolis’ second quarter financial statements and MD&A have been posted to the Company’s website and can be accessed at http://trakopoliscorp.com/investors/. The MD&A and Financial Statements have also been filed with SEDAR and will be accessible at www.sedar.com.

About Trakopolis Trakopolis is a Software as a Service (SaaS) company with proprietary, cloud-based solutions for real-time tracking, data analysis and management of corporate assets such as equipment, devices, vehicles and workers. The Company's asset management platform works across a variety of networks and devices. Trakopolis has a diversified revenue stream from many verticals including oil and gas, forestry, transportation, construction, rentals, urban services, mining, government and others.

For further information, please contact:

Brent Moore, President and Chief Executive OfficerTrakopolis IoT Corp.Telephone: [phone] Email: [e-mail]

Forward-Looking Information

This news release includes certain "forward-looking statements" under applicable Canadian securities legislation that are not historical facts. Forward-looking statements involve risks, uncertainties, and other factors that could cause actual results, performance, prospects, and opportunities to differ materially from those expressed or implied by such forward-looking statements. Forward-looking statements in this news release include, but are not limited to, statements regarding: the ability of the Company to achieve material sales growth. Forward-looking statements are necessarily based on a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties and other factors which may cause actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: the ability of the Company to retain or attract qualified personnel to successfully implement products and services following the sales process; those additional risks set out in the Company's public documents filed on SEDAR at www.sedar.com; and other matters discussed in this news release. Although the Company believes that the assumptions and factors used in preparing the forward-looking statements are reasonable, undue reliance should not be placed on these statements, which only apply as of the date of this news release, and no assurance can be given that such events will occur in the disclosed time frames or at all.  Except where required by law, the Company disclaims any intention or obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.

Non-GAAP Measures

This news release contains references to certain financial measures that do not have any standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other entities. These non-GAAP financial performance measures should be viewed as a supplement to, and not a substitute for, the Company’s results of operations reported under IFRS. These financial measures are identified and defined below:

A “Subscriber” is defined as a customer's individual asset which is monitored by a telematics device. A Subscriber is an important metric for our investors because it provides an indication of our ability to generate Recurring Revenue from providing recurring service to our customers. 

EBITDA refers to earnings before interest, tax, depreciation and amortization (“EBITDA”),

Please refer to the Company’s June 30, 2019 MD&A dated August 22, 2019 for additional information regarding these non-GAAP measures.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.