GNS Genius Group Limited

Genius Group Limited (“Genius Group” or the “Company”) (NYSE American: GNS), a leading entrepreneur Edtech and education group, today announced its financial results for the first half of 2022.

Financial Highlights From the First Half of 2022

• H1 2022 revenue growth to $7.44 million, 17.18% growth over H1 2021 and revenue of $16.57 million on a pro forma basis in H1 2022
• H1 2022 gross margin of 29.97%, compared to 25.85% in H1 2021 and gross margin of 48.49% on a pro forma basis in H1 2022
• H1 2022 net loss of ($3.50) million and net loss on a pro forma basis of ($2.61) million in H1 2022
• H1 2022 EBITDA net loss of ($1.96) million compared to EBITDA net loss of ($0.62) million in H1 2021 and EBITDA net loss on a pro forma basis of ($0.95) million in H1 2022
• Cash and equivalent as of June 30, 2022 of $7.58 million compared to $1.78 million as of December 31, 2021

Roger Hamilton, CEO of Genius Group, commented: “Through the first half of the year, Genius Group has continued to see strong demand, resulting in pro forma margin expansion and significant growth in the number of students visiting our platform. Individuals are increasingly turning to online learning to complement their education and acquire the digital skills required in today’s economy, and this is reflected in our results.”

Operational Highlights

• The number of students grew to 2.8 million, which represents a 13% growth on an annualized basis. On a pro forma basis, Genius Group had a group user base of 4.2 million (students and users) at the end of H1 2022.
• The number of paying students grew to 39,124 since December 2021, a 9.44% annualized growth rate. On a pro forma basis, the company had 164,673 paying students and users.
• The number of partners grew to 10,622 since December 2021, a 7.9% annualized growth rate. On a pro forma basis, partners grew to 12,391 since December 2021.

Other Recent Highlights

• Appointment of Richard Berman as Audit Committee Chair after he joined the Company’s Board of Directors in January 2022
• Appointment of Tim Murphy as Director and Head of Compliance Committee on the Board in September 2022
• Appointment of Erez Simha as Chief Financial Officer to scale the company through both organic and inorganic growth
• Appointment of Rav Karwal as Chief Revenue Officer to lead revenue, sales, and other go-to-market strategies and ensure exceptional client experiences
• Acquisition of New Zealand-based Education Angels, a provider of in-home child care services, for US$1.9m
• Acquisition of South African-based E-Squared Education Enterprises, a full campus with primary, secondary and college education for students in entrepreneurship, for $2.6m
• Acquisition of U.S.-based University of Antelope Valley, accredited university in California, for $13m
• Acquisition of U.K.-based Property Investors Network, a provider of property investment education, for $19.1m
• Acquisition of U.S.-based Revealed Films Inc., media production company that specializes in multi-part documentaries, for US$10m
• Sold a senior secured convertible note with a principal amount of $18.1m for a purchase price of $17 million

Financial Guidance

We are maintaining our 2022 pro forma adjusted EBITDA guidance at a lower pro forma revenue range.

• Pro forma annual revenue of $35.0m-$38.0m
• Pro forma adjusted EBITDA of $0.5m - $1.5m
• Weighted average share count of 22,458,386
• Number of students (and users) 4.2m-4.4m

Webcast and Conference Call

Genis Group will host a live webcast to discuss the results today at 8:00 a.m. ET / 8:00 p.m. SGT. The webcast and supplemental information can be accessed on the investor relations section of the Genius Group website at ir.geniusgroup.net. An archive will be available after the conclusion of the live event and will remain available via the same link for 6 months.

Time: Wednesday, October 19, 2022, at 8:00 a.m. ET / 8:00 p.m. SGT

Webcast: Go to the Investor Relations section of the Genius Group website to listen and view the slides.

Dial-in: 877-407-0712 (U.S. Toll Free); +1 201-493-6716 (International)

About Genius Group

Genius Group is a world leading entrepreneur Edtech and education group, with a mission to disrupt the current education model with a student-centered, life-long learning curriculum that prepares students with the leadership, entrepreneurial and life skills to succeed in today’s market. The group has a group user base of 4.2 million in 200 countries, ranging from ages 0 to 100.

Forward-Looking Statements

This press release contains certain forward-looking statements within the meaning of the U.S. federal securities laws, including (without limitation) statements regarding our or our management’s expectations, hopes, beliefs, intentions or strategies regarding the future and other statements that are other than statements of historical fact. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. Forward-looking statements are generally identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result” and similar expressions, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties.

Many factors could cause actual future events to differ materially from the forward-looking statements in this press release, including but not limited to: the Company’s goals and strategies; the Company’s future business development; changes in demand for online learning; changes in technology; fluctuations in economic conditions; the growth of the online learning industry the United States and the other markets the Company serves or plans to serve; reputation and brand; the impact of competition and pricing; government regulations; and assumptions underlying or related to any of the foregoing and other risks contained in reports filed by the Company with the Securities and Exchange Commission (the “SEC”). For these reasons, among others, investors are cautioned not to place undue reliance upon any forward-looking statements in this press release. Additional factors are discussed in the Company’s filings with the SEC, which are available for review at www.sec.gov. The Company undertakes no obligation to publicly update these forward-looking statements to reflect events or circumstances that arise after the date hereof.

Key Business Metrics

We monitor the key business metrics and Non-IFRS financial measures to help us evaluate our business and growth trends, set growth targets and budgets, and measure the effectiveness of our sales and marketing efforts. These key business metrics and Non-IFRS financial measures are presented for supplemental informational purposes only, are not a substitute for IFRS financial measures, and may differ from similarly titled metrics or measures presented by other companies. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Key Business Metrics and Non-IFRS Financial Measures” for detailed descriptions of the measures and metrics.

Non-IFRS Financial Measure

We have included Adjusted EBITDA because it is a key measure used by our management and board of directors to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget and to develop short- and long-term operational plans. In particular, the exclusion of certain expenses in calculating Adjusted EBITDA can provide a useful measure for period-to-period comparisons of our core business.

We calculate Adjusted EBITDA as net profit / loss for the period plus income taxes and social contribution plus / minus finance revenue /expense result plus depreciation and amortization plus share-based compensation expenses plus bad debt provision.

 GENIUS GROUP LIMITED AND SUBSIDIARIES CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION (In US Dollars)

 

 

 

As of June 30,

 

 

As of December 31,

 

 

 

2022

 

 

2021

 

 

 

(Unaudited)

 

 

(Audited)

 

Assets

 

 

 

 

 

 

 

 

Current Assets

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

7,576,587

 

 

$

1,784,938

 

Accounts receivable, net

 

 

2,137,771

 

 

 

1,018,003

 

Other receivables

 

 

4,226,476

 

 

 

66,000

 

Due from related parties

 

 

2,025,440

 

 

 

44,245

 

Inventories

 

 

96,181

 

 

 

92,530

 

Prepaid expenses and other current assets

 

 

2,866,462

 

 

 

3,490,446

 

Total Current Assets

 

 

18,928,917

 

 

 

6,496,162

 

Property and equipment, net

 

 

6,753,497

 

 

 

6,776,116

 

Operating lease right-of-use asset

 

 

808,376

 

 

 

1,077,241

 

Investments at fair value

 

 

109,583

 

 

 

29,069

 

Goodwill

 

 

17,156,708

 

 

 

1,320,100

 

Intangible assets, net

 

 

3,509,138

 

 

 

1,394,969

 

Other non-current assets

 

 

13,296,318

 

 

 

501,750

 

Total Assets

 

 

60,562,537

 

 

 

17,595,407

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

 

 

Current Liabilities

 

 

 

 

 

 

 

 

Accounts payable

 

 

1,608,171

 

 

 

1,078,381

 

Accrued expenses and other current liabilities

 

 

3,620,576

 

 

 

2,064,302

 

Deferred revenue

 

 

2,494,753

 

 

 

2,561,912

 

Operating lease liabilities – current portion

 

 

210,809

 

 

 

436,271

 

Income tax payable

 

 

377,190

 

 

 

-

 

Loans payable – current portion

 

 

28,923

 

 

 

65,415

 

Loans payable – related parties – current portion

 

 

532,265

 

 

 

425,551

 

Convertible debt obligations, current portion

 

 

900,974

 

 

 

507,765

 

Total Current Liabilities

 

 

9,773,661

 

 

 

7,139,597

 

Due to related parties

 

 

-

 

 

 

-

 

Operating lease liabilities – non-current portion

 

 

842,056

 

 

 

894,589

 

Loans payable – non-current portion

 

 

1,281,786

 

 

 

85,858

 

Convertible debt obligations, non-current portion

 

 

-

 

 

 

766,245

 

Deferred tax liability

 

 

1,070,157

 

 

 

723,122

 

Total Liabilities

 

 

12,967,660

 

 

 

9,609,411

 

Commitments and Contingencies Stockholders’ Equity:

 

 

 

 

 

 

 

 

Contributed capital

 

 

94,026,740

 

 

 

50,924,276

 

Subscriptions receivable

 

 

(1,954,415

)

 

 

(1,900,857

)

Reserves

 

 

(34,809,105

)

 

 

(31,888,638

)

Accumulated deficit

 

 

(16,523,809

)

 

 

(13,493,684

)

Capital and reserves attributable to owners of Genius Group Ltd

 

 

40,739,411

 

 

 

3,641,097

 

Non controlling interest

 

 

6,855,466

 

 

 

4,344,899

 

Total Stockholders’ Equity

 

 

47,594,877

 

 

 

7,985,996

 

Total Liabilities and Stockholders’ Equity

 

 

60,562,537

 

 

 

17,595,407

 

 

GENIUS GROUP LIMITED AND SUBSIDIARIES CONSOLIDATED INTERIM STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (In US Dollars) 

 

 

June 30,

 

 

June 30,

 

 

 

2022

 

 

2021

 

 

 

(Unaudited)

 

 

(Unaudited)

 

Revenue

 

$

7,443,230

 

 

$

6,351,751

 

Cost of revenue

 

 

(5,212,637

)

 

 

(4,708,872

)

Gross profit

 

 

2,230,593

 

 

 

1,642,859

 

Operating (Expenses) Income

 

 

 

 

 

 

 

 

General and administrative

 

 

(5,249,054

)

 

 

(3,055,332

)

Depreciation and amortization

 

 

(178,807

)

 

 

(81,993

)

Other operating income

 

 

166,001

 

 

 

67,230

 

Loss from foreign currency transactions

 

 

58,759

 

 

 

(66,187

)

Total operating expenses

 

 

(5,203,101

)

 

 

(3,136,282

)

Loss from Operations

 

 

(2,972,508

)

 

 

(1,493,423

)

(Expense) Income

 

 

 

 

 

 

 

 

Interest expense, net

 

 

(99,298

)

 

 

(182,783

)

Impairment loss

 

 

(480,372

)

 

 

—

 

Other income

 

 

30,713

 

 

 

—

 

Total Other Expense

 

 

(548,957

)

 

 

(182,783

)

Loss Before Income Tax

 

 

(3,521,465

)

 

 

(1,676,206

)

Income Tax Benefit (Expense)

 

 

24,238

 

 

 

47,039

 

Net Loss

 

 

(3,497,227

)

 

 

(1,629,167

)

Other comprehensive income:

 

 

 

 

 

 

 

 

Foreign currency translation

 

 

(69,375

)

 

 

70,711

 

Total Comprehensive Loss

 

 

(3,566,602

)

 

 

(1,558,456

)

Total Comprehensive Loss is attributable to:

 

 

 

 

 

 

 

 

Owners of Genius Group Ltd

 

 

(3,420,929

)

 

 

(1,530,682

)

Non controlling interest

 

 

(145,673

)

 

 

(27,774

)

Total Comprehensive Loss

 

 

(3,566,602

)

 

 

(1,558,456

)

Weighted-average number of shares outstanding, basic and diluted

 

 

17,794,634

 

 

 

16,155,812

 

Basic and diluted earnings (loss) per share from continuing operations

 

 

(0.20

)

 

 

(0.10

)

 

GENIUS GROUP LIMITED AND SUBSIDIARIES INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS (In US Dollars) 

 

 

For the Period Ended

 

 

 

June 30, 2022

 

 

December 31, 2021

 

 

 

(Unaudited)

 

 

(Audited)

 

Cash Flows From Operating Activities

 

 

 

 

 

 

 

 

Net loss

 

$

(3,497,227

)

 

$

(4,489,198

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

 

 

Stock-based compensation

 

 

150,317

 

 

 

293,837

 

Depreciation and amortization

 

 

835,757

 

 

 

1,574,913

 

Deferred tax liability

 

 

—

 

 

 

105,650

 

Amortization of debt discount

 

 

—

 

 

 

140,837

 

Provision for doubtful debts

 

 

—

 

 

 

(39,108

)

Amortization of tax liability

 

 

(29,679

)

 

 

—

 

Impairment loss

 

 

480,372

 

 

 

—

 

Loss on foreign exchange transactions

 

 

(58,759

)

 

 

153,692

 

Interest expense on lease liabilities

 

 

58,026

 

 

 

131,291

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

(480,438

)

 

 

(30,554

)

Other receivable

 

 

—

 

 

 

(66,000

)

Prepaid expenses and other current assets

 

 

(1,840,348

)

 

 

(1,927,176

)

Inventory

 

 

(3,651

)

 

 

20,013

 

Accounts payable

 

 

430,633

 

 

 

256,562

 

Accrued expenses and other current liabilities

 

 

(609,406

)

 

 

254,080

 

Deferred revenue

 

 

82,841

 

 

 

1,015,200

 

Deferred tax liability

 

 

—

 

 

 

(257,953

)

Other non-current liabilities

 

 

—

 

 

 

(217,291

)

Total adjustments

 

 

(984,335

)

 

 

1,407,993

 

Net Cash Used In Operating Activities

 

 

(4,481,562

)

 

 

(3,081,205

)

Cash Flows From Investing Activities

 

 

 

 

 

 

 

 

Purchase of intangible assets

 

 

(313,876

)

 

 

(804,314

)

Purchase of equipment

 

 

(79,455

)

 

 

(77,797

)

Acquisition of PIN, EA and ESQ

 

 

(2,116,456

)

 

 

—

 

Deposit on investment in UAV

 

 

(6,604,194

)

 

 

—

 

Investment at fair value

 

 

(80,514

)

 

 

 

 

Net Cash Used In Investing Activities

 

 

(9,194,496

)

 

 

(882,111

)

Cash Flows From Financing Activities

 

 

 

 

 

 

 

 

Amount due to/from related party

 

 

(338,280

)

 

 

(154,345

)

Proceeds from sale of future shares

 

 

—

 

 

 

953,087

 

Proceeds from equity issuances, net of issuance costs

 

 

2,605,215

 

 

 

3,127,442

 

Proceeds from IPO, net

 

 

18,060,447

 

 

 

—

 

Issuance from convertible debt

 

 

(147,582

)

 

 

—

 

Operating lease liability payments

 

 

(306,811

)

 

 

(758,522

)

Proceeds/ (Repayments) of loans payable

 

 

(192,465

)

 

 

(71,967

)

Net Cash Provided By Financing Activities

 

 

19,680,524

 

 

 

3,095,695

 

Effect of Exchange Rate Changes on Cash

 

 

(212,817

)

 

 

379,408

 

Net Increase (Decrease) In Cash

 

 

5,791,649

 

 

 

(488,213

)

Cash – Beginning of year

 

 

1,784,938

 

 

 

2,273,151

 

Cash – End of period

 

 

7,576,587

 

 

 

1,784,938

 

Pro Forma Financials

Pro forma financials for Genius Group (The full Group including the Group and the all Acquisitions YTD): Unaudited pro forma financials provided for the period ended June 30, 2022, for the full Group, including all acquired companies YTD as if they were operating as one during these periods. The acquisitions included in the table below are Property Investors Network (acquired April 30, 2020), Education Angels (acquired April 30, 2022), E-Square (acquired May 31, 2022), University of Antelope Valley (acquired July 07, 2022) and Revealed Films (acquired October 04, 2022).

 

 

Genius Group Pro forma Six Months Ended (USD 000’s)

Summary Income Statement

 

June 30, 2022

 

Sales

 

 

16,573

 

Cost of goods sold

 

 

(8,536

)

Gross profit (Loss)

 

 

8,037

 

Other Operating Income

 

 

225

 

Operating Expenses

 

 

(11,086

)

Operating profit (Loss)

 

 

(2,824

)

Other income

 

 

783

 

Other Expense

 

 

(588

)

Net Income (Loss) Before Tax

 

 

(2,630

)

Tax Expense

 

 

24

 

Net Income (Loss) After Tax

 

 

(2,605

)

Other Comprehensive Income

 

 

(70

)

Total Income (Loss)

 

 

(2,675

)

Net income per share, basic and diluted

 

 

(0.15

)

Weighted-average number of shares outstanding, basic and diluted

 

 

17,794,634

 

 

 

Genius Group Pro forma Six Months Ended (USD 000’s)

Adjusted EBITDA

 

June 30, 2022

Net Income (Loss)

 

 

(2,605)

Tax Expense

 

 

(24)

Interest Expense, net

 

 

108

Depreciation and Amortization

 

 

938

Goodwill Impairments

 

 

480

Stock Based Compensation

 

 

150

Adjusted EBITDA

 

 

(953)

 

 

Genius Group Pro forma Six Months Ended (USD 000’s)

 

 

 

June 30, 2022

 

Summary Balance Sheet Data:

 

 

 

 

Total current assets

 

 

21,751

 

Total non-current assets

 

 

56,781

 

Total Assets

 

 

78,532

 

Total current liabilities

 

 

12,033

 

Total non-current liabilities

 

 

11,904

 

Total Liabilities

 

 

23,937

 

Total Shareholders’ Equity

 

 

54,595

 

Total Liabilities and Shareholders’ Equity

 

 

78,532

 

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20221019005474/en/

Investors: Flora Hewitt, Vice President of Investor Relations and Mergers and Acquisitions Email: investor@geniusgroup.net

Media: Ruth Shearman, Senior Account Manager, Adia PR Email: gns@adiapr.co.uk