TORONTO, Nov. 8, 2024 /PRNewswire/ – Quarterhill Inc. (“Quarterhill” or the “Company”) (TSX: QTRH) (OTCQX: QTRHF), a prominent supplier of tolling and enforcement answers within the Clever Transportation Device (“ITS”) trade, publicizes its monetary effects for the 3 and 9 months ended September 30, 2024. All monetary knowledge on this press let go is reported in United States (“US”) bucks, until another way indicated.

Quarterhill has modified the presentation foreign money of its monetary statements to US bucks, its useful foreign money. An important percentage of the Corporate’s gross sales, bills, property, and liabilities are denominated in US bucks. This modification in presentation foreign money targets to strengthen exterior stakeholders’ talent to evaluate Quarterhill’s monetary efficiency and to loose the have an effect on of foreign currencies volatility.

Q3 2024 Highlights

• Earnings used to be $38.0 million in comparison to $34.1 million in Q3 2023.
• Adjusted EBITDA¹ used to be ($2.8) million in comparison to $1.4 million in Q3 2023.
• Earnings backlog³ used to be $475 million at September 30, 2024.
• Introduced fresh enforcement unit agreements in Thailand, South Korea, South Dakota, Minnesota and North Carolina.
• Gained a $3.8 million dividend on account of possession stake in Wi-LAN Inc.
• Established Technical Advisory Committee with Bobby Parikh and Vineet Khosla, two AI and device studying innovators skilled in transportation-related applied sciences.
• Next to quarter-end, signed a share-purchase oath to promote its 50% hobby within the Chinese language three way partnership, Xuzhou-PAT Regulate Applied sciences Restricted (“XPCT”) for rude proceeds of roughly $4.9 million.

“Our enforcement unit had another strong quarter with multiple new contracts, top-line growth and solid margins, while in our tolling unit, we increased our bid activity and expanded mandates with several existing customers,” mentioned Chuck Myers, CEO at Quarterhill. “In Q3, we received our first dividend from our ownership position in Wi-LAN, and after quarter-end, we signed a share purchase agreement to sell our position in the Chinese joint venture, XPCT. Combined, these two developments will generate approximately $8 million in cash, thus strengthening our balance sheet as we head towards 2025.”

“Over the past twelve months, we have worked hard to turn around the Company by integrating our ITS businesses, selling non-core assets, optimizing our cost base, adding new leadership, enhancing our technical capabilities and addressing select legacy contract challenges. We believe we are near the end of this process and are well positioned to capitalize on the benefits from these changes in 2025 and beyond.”

“We have two tolling contracts for which we took reserves in Q3, impacting margins by approximately $4 million. We believe these reserves will be sufficient for both projects to reach operations phase acceptance and become steady and profitable long-term contracts for the business. For the business as a whole, we expect to return to positive Adjusted EBITDA in Q4 2024 and to then grow our top-line and margins into 2025.”

“The future of the ITS industry will be shaped by advanced technology solutions, with AI and machine learning playing pivotal roles in delivering enhanced outcomes for customers. We are committed to being at the forefront of this shift as we invest in our software solutions and next generation architecture. We have recently added new leadership to our technical team, and at quarter-end, we established a Technical Advisory Board, bringing on two renowned experts in AI and modern software architecture to guide the development of our technology roadmap to meet our customers’ desires. With our team, assets, and strategic direction, we are well-positioned to capitalize on the opportunities ahead, emerge as an industry leader and deliver improved financial results.”

Q3 2024 Monetary Overview

Quarterhill’s Control’s Dialogue and Research and monetary statements for the 3 and 9 months ended September 30, 2024 are to be had on the Company’s website and at its profile at SEDAR+.

Monetary statements for the 3 and 9 months ended September 30, 2023, had been ready to mirror proceeding operations, and subsequently, exclude effects all the way through that length from Wi-LAN Inc. (“WiLAN”), which used to be bought via Quarterhill on June 15, 2023.

Revenues for the 3 and 9 months ended September 30, 2024, had been $38.0 million and $114.4 million, up 12% and 13%, respectively, in comparison to $34.1 million and $101.0 million within the 3 and 9 months ended September 30, 2023. The rise in revenues used to be essentially because of persisted sturdy efficiency from the enforcement operations, which used to be offset partially via reserves taken relative to price overruns on two tolling tasks that had a $3 million have an effect on on earnings.

Rude benefit² as a price and as a proportion of revenues is also topic to vital variance in every reporting length because of the character and form of commitment and repair paintings carried out. Rude benefit for the 3 and 9 months ended September 30, 2024, used to be $5.1 million and $20.0 million, or 13% and 17%, as in comparison to $7.9 million and $21.6 million, or 23% and 21%, within the 3 and 9 months ended September 30, 2023. The year-over-year decreases in comparison to the prior 12 months classes had been essentially because of the $4 million of reserves taken in Q3 2024 connected to price overruns at the two tolling tasks as in the past famous. The year-over-year decreases in rude benefit margin had been partly offset via persisted sturdy margin efficiency from the enforcement operations.

Overall running bills are constructed from promoting, basic and administrative prices (“SG&A”), analysis and building (“R&D”) prices, depreciation, amortization of intangible property and alternative fees. Overall running bills for the 3 and 9 months ended September 30, 2024, had been $11.3 million and $32.5  million in comparison to $9.9 million and $32.1 million within the 3 and 9 months ended September 30, 2023. The year-over-year will increase had been essentially because of upper SG&A, offset partially via decrease R&D bills. SG&A higher year-over-year, pushed via the Corporate’s investments in management and sources for its mission, bid, and building groups. For the year-to-date length, this building up used to be partly offset via a discount in pressure in alternative industry subjects.

Adjusted EBITDA¹ for the 3 and 9 months ended September 30, 2024, used to be ($2.8) million and ($0.9) million in comparison to $1.4 million and $0.5 million for the 3 and 9 months ended September 30, 2023. The snip in Adjusted EBITDA for the 3 and 9 months ended September 30, 2024, in comparison to the prior 12 months classes, used to be because of the $4 million have an effect on of the fee overruns on earnings and rude benefit as in the past defined, and offset, partially, via upper general earnings.

Web loss from proceeding operations for the 3 and 9 months ended September 30, 2024, used to be ($4.1) million and ($11.3) million, or ($0.04) and ($0.10) according to diluted proportion, in comparison to a web loss from proceeding operations of ($1.7) million and ($20.9) million, or ($0.01) and ($0.18) according to diluted proportion, for the 3 and 9 months ended September 30, 2023.

Money old in proceeding operations for the 3 and 9 months ended September 30, 2024, used to be ($1.7) million and ($11.0) million in comparison to coins old in proceeding operations of ($0.7) million and ($14.1) million for the 3 and 9 months ended September 30, 2023.

Money and coins equivalents had been $23.1 million at September 30, 2024, in comparison to $42.7 million at December 31, 2023. Because of the character of the Corporate’s industry actions, running coins flows might range considerably between classes because of adjustments and timing in running capital balances. Adjusted Operating Capital⁴ used to be $64.9 million at September 30, 2024, in comparison to $78.9 million at December 31, 2023.

Convention Name and Webcast
Quarterhill will host a convention name to speak about its monetary effects on Friday, November 8, 2024, at 10:00 AM Jap Day.

Webcast Data
Are living audio webcast might be to be had at: https://app.webinar.net/P03G1qda8o9         

Conventional Dial-in Data

• To get right of entry to the decision from the U.S. and Canada, dial 1.888.699.1199 (Toll Sovereign)
• To get right of entry to the decision from alternative places, dial 1.416.945.7677 (World)

Rapidconnect
To right away attach the convention name via telephone, please utility refer to URL to simply sign up and be hooked up into the convention name robotically: https://emportal.ink/4eGHMhl    

Phone Replay
Phone replay might be to be had from November 8, 2024, till November 15, 2024, at: 1.888.660.6345 (Toll Sovereign North The us) or 1.289.819.1450.

Convention ID: 17855 and Replay Passcode: 17855#

Non-IFRS Monetary Measures and Non-IFRS Ratios
Quarterhill makes use of each IFRS and likely non-IFRS monetary measures to evaluate efficiency. Non-IFRS monetary measures are monetary measures disclosed via an organization that (a) depict ancient or anticipated day monetary efficiency, monetary place or coins wave of an organization, (b) with appreciate to their composition, exclude quantities which are incorporated in, or come with quantities which are excluded from the composition of essentially the most at once related monetary measure disclosed in the principle monetary statements of the corporate, (c) don’t seem to be disclosed within the monetary statements of the corporate and (d) don’t seem to be a ratio, fraction, proportion or matching illustration. Non-IFRS ratios are monetary measures disclosed via an organization which are within the method of a ratio, fraction, proportion or matching illustration that has a non-IFRS monetary measure as a number of of its parts, and that don’t seem to be disclosed within the monetary statements of the corporate.

Those non-IFRS monetary measures and non-IFRS ratios don’t seem to be standardized monetary measures underneath IFRS, and, subsequently, are not going to be related to matching monetary measures offered via alternative firms. Control believes those non-IFRS monetary measures and non-IFRS ratios grant clear and helpful supplemental knowledge to assistance traders evaluation our monetary efficiency, monetary status, and liquidity the use of the similar measures as control. Those non-IFRS monetary measures and non-IFRS ratios will have to now not be thought to be as an alternative to, or great to, measures of monetary efficiency ready in line with IFRS.

Adjusted EBITDA – Non-IFRS Monetary Measures

We utility the non-IFRS monetary measure “Adjusted EBITDA” to ruthless web (loss) source of revenue adjusted for (i) source of revenue taxes, (ii) finance expense or source of revenue; (iii) amortization and impairment of intangibles; (iv) alternative fees and alternative one-time pieces; (v) depreciation of right-of-use property and quality, plant and gear; (vi) stock- founded repayment; (vii) foreign currencies (acquire) loss; and (viii) alternative source of revenue which contains fairness in profits from joint ventures; (ix) dividends won from joint ventures; and * adjustments in truthful price of by-product legal responsibility. Adjusted EBITDA is old via our control to evaluate our normalized coins generated on a consolidated foundation. Adjusted EBITDA could also be a efficiency measure that can be old via traders to research the money generated via Quarterhill. Adjusted EBITDA will have to now not be interpreted as an supplementary to web (loss) source of revenue and coins flows from operations as progressive in line with IFRS or as measure of liquidity. Probably the most at once related IFRS monetary measure is Web (loss) source of revenue.

Adjusted EBITDA according to proportion – Non-IFRS Ratio

Adjusted EBITDA according to proportion is calculated as Adjusted EBITDA divided via the modest weighted reasonable of habitual stocks. Adjusted EBITDA according to proportion is old via our control and traders to research coins generated via Quarterhill on a according to proportion foundation. Probably the most related IFRS measure is profits according to proportion.

Adjusted Operating Capital – Non-IFRS Monetary Measure

Adjusted Operating Capital is calculated as modern property minus modern liabilities, adjusted for convertible debentures and by-product legal responsibility. Adjusted Operating Capital displays our web running capital anticipated to be settled in coins inside one year.

Backlog – Non-IFRS Monetary Measure

We utility the non-IFRS measure “backlog” to ruthless the overall price of labor that has now not but been finished however that during control’s revel in of matching statuses has: (a) a prime sure bet of being carried out pursuant to present agreements or paintings orders specifying activity scope, price and timing; (b) an expectation of growth of present agreements because of anticipated extensions; and/or (c) been awarded to a number of of our ITS running subsidiaries as evidenced via a binding commitment or the place the finalization of a binding commitment is relatively confident. Actions underneath such agreements might secure a length of as much as 15 years. We don’t come with in “backlog”, the price of any anticipated however unsigned exchange orders that control considers might practice to such agreements.

Additional Monetary Measures
Additional monetary measures are monetary measures disclosed via an organization that (a) are, or are supposed to be, disclosed on a periodic foundation to depict the ancient or anticipated day monetary efficiency, monetary place or coins wave of an organization (b) don’t seem to be disclosed within the monetary remark of the corporate, (c) don’t seem to be non-IFRS monetary measures, and (d) don’t seem to be non-IFRS ratios.

Key backup measures disclosed are as follows:

Rude margin %
Calculated as rude benefit as a proportion of earnings.

About Quarterhill
Quarterhill is a prominent supplier of tolling and enforcement answers within the Clever Transportation Device (ITS) trade. Our function is technology-driven international management in ITS, by means of natural enlargement of our tolling and enforcement companies, and via proceeding an acquisition-oriented funding technique that capitalizes on sexy enlargement alternatives inside ITS and its adjoining markets. Quarterhill is indexed at the TSX underneath the emblem QTRH and at the OTCQX Very best Marketplace underneath the emblem QTRHF. For more info: www.quarterhill.com.

Ahead-looking Data
This information let go accommodates forward-looking knowledge and forward-looking statements inside the which means of appropriate Canadian securities regulations (jointly, “forward-looking statements”) referring to Quarterhill, its running subsidiaries and their respective companies. Such forward-looking statements relate to day occasions, statuses or day monetary efficiency of ‎Quarterhill according to day financial statuses and classes of motion. All statements alternative ‎than statements of ancient truth is also forward-looking statements. Such forward-looking statements ‎are frequently, however now not all the time, known via the utility of any phrases reminiscent of “seek”, “anticipate”, “budget”, ‎‎”plan”, “goal”, and matching expressions. Those statements contain identified and unknown dangers, suppositions, ‎uncertainties and alternative components that can reason unedited effects or occasions to range materially from the ones expected in such forward-looking statements. The Corporate believes the expectancies mirrored in ‎the ones forward-looking statements are cheap, however incorrect word of honour can also be for the reason that those expectancies ‎will end up to be proper and such forward-looking statements incorporated on this information let go will have to now not be ‎unduly relied upon.‎ Specifically, this information let go accommodates forward-looking statements concerning, however now not restricted to, the ‎following: operational and monetary expectancies for the 2024 monetary 12 months, together with earnings, rude margin and Adjusted EBITDA expectancies; and the Corporate’s marketing strategy.

‎ Even if the forward-looking statements contained on this information let go are founded upon suppositions ‎which control of the Corporate believes to be cheap, the Corporate can not safeguard traders ‎that unedited effects might be in step with those forward-looking statements. With appreciate to forward-‎shopping statements contained on this information let go, the Corporate has made suppositions referring to, however ‎now not restricted to: the Corporate’s talent to shoot on its marketing strategy; a hit integration of Crimson Fox; the power to effectively entire the transaction in terms of the disposition of its hobby in XPCT; basic financial and trade traits; running suppositions in terms of the ‎Corporate’s operations; call for for the Corporate’s services and products; price estimates for mounted value agreements; and the alternative suppositions i’m ready forth within the ‎Corporate’s most up-to-date annual knowledge method to be had underneath the Corporate’s profile on SEDAR+ at www.sedarplus.ca.‎

The Corporate’s unedited effects may just range materially from the ones expected within the forward-looking statements, because of various identified and unknown dangers and uncertainties and alternative components together with, however now not restricted to: adjustments in call for for the Corporate’s services and products; basic financial, political, marketplace and industry statuses, together with fluctuations in rates of interest, foreign currencies charges, inventory marketplace volatility; reliance on key control body of workers; dangers connected to festival inside the Corporate’s trade and in terms of technological advances; litigation dangers; cyber-security dangers; mounted value agreements might lead to surprising prices to the Corporate; dangers of fitness epidemics, pandemics and matching outbreaks; and the alternative dangers i’m ready forth within the Corporate’s most up-to-date annual knowledge method and control’s dialogue and research for the 3 and one year ended December 31, 2023 to be had underneath the Corporate’s profile on SEDAR+ at www.sedarplus.ca.‎

The Corporate’s unedited effects, efficiency or success may just range materially from the ones ‎expressed in, or implied via, those forward-looking statements and, accordingly, incorrect word of honour can also be ‎for the reason that any of the occasions expected via the forward-looking statements will transpire or happen, or if ‎any of them accomplish that, what advantages the Corporate will derive therefrom. Readers are subsequently cautioned ‎that the foregoing lists of remarkable components don’t seem to be exhaustive, they usually will have to now not unduly depend at the ‎forward-looking statements incorporated on this information let go. All forward-looking statements contained on this information let go are expressly ‎certified via this cautionary remark. Quarterhill has incorrect purpose, and undertakes incorrect legal responsibility, to replace or revise any forward-looking statements, whether or not because of fresh knowledge, day occasions or another way, aside from as required via legislation.

This information let go accommodates “future-oriented financial information” and “financial outlooks” inside the which means of appropriate Canadian securities regulations (jointly, “FOFI”), together with concerning the monetary effects, earnings, rude margin and Adjusted EBITDA of Quarterhill for the 12 months ended December 31, 2024. FOFI, as with forward-looking ‎statements ‎usually, are, with out limitation, according to the suppositions and {qualifications}, and are topic to the dangers, put forth ‎above in appreciate of forward-looking statements. Quarterhill’s unedited monetary place and result of operations might range materially from ‎control’s ‎modern expectancies and, consequently, the Corporate’s monetary effects might range ‎materially from ‎the FOFI equipped on this information let go. The Corporate and its control imagine that the FOFI has been ready on a cheap foundation, reflecting control’s absolute best estimates and judgments and the FOFI contained on this information let go used to be authorized via control as of the generation hereof, for functions of offering additional details about the Corporate’s day industry operations and effects. On the other hand, as a result of this knowledge is subjective and topic to various dangers and suppositions, it will have to now not be trusted as essentially indicative of day effects. Apart from as required via appropriate securities regulations, the Corporate undertakes incorrect legal responsibility to replace such FOFI. Readers are cautioned that the FOFI contained on this information let go will have to now not be old for functions alternative than for which it’s disclosed herein, and such knowledge is ‎offered for ‎illustrative functions most effective and is probably not a sign of the Corporate’s unedited ‎monetary place or ‎result of operations.‎

Intervening time Condensed Consolidated Statements of Loss and Complete Loss
(in hundreds and in United States bucks, aside from proportion and according to proportion quantities)

Intervening time Condensed Consolidated Statements of Monetary Place
(in hundreds and in United States bucks)

Intervening time Condensed Consolidated Statements of Money Flows
(in hundreds and in United States bucks)

Intervening time Condensed Consolidated Statements of Shareholders’ Fairness
(in hundreds and in United States bucks)

Reconciliation of Web Loss to Adjusted EBITDA
(in hundreds and in United States bucks, aside from proportion and according to proportion quantities)

SOURCE Quarterhill Inc.

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