SPRX Sparx Technology Inc

VANCOUVER, BC, Oct. 28, 2022 /CNW/ - Sparx Technology Inc. (TSXV: SPRX) (OTCQB:STCXF) ("Sparx" or the "Company") is pleased to announce its results for the year ended June 30, 2022. All amounts are in Canadian dollars unless otherwise indicated.

"The growth achieved in revenues from the previous year was the result of the innovation from our product and sales teams. Achieving these results while only having access to the capital we raised for just over three months of our fiscal year shows the strong potential of the Sparx platform." said President and CEO, Al Thorgeirson.

OPERATING RESULTS

2022 ANNUAL RESULTS

Sparx recognized revenues of $930,777 and $698,188 for the same period in 2021. The increase in revenue in 2022, is primarily attributable to the addition of a Canadian Chartered Bank customer who utilized the Company's Sparx Studio platform during the second quarter of the 2022 fiscal year.  In total, the Company added six new enterprise customers to their portfolio during the 2022 fiscal year. The remaining increase in revenues are predominantly related to increased scope of work provided for recurring customers.

Operating expenses saw an increase due to professional and consulting fees relating to the reverse takeover in Q3 of 2022. Further increases in the fiscal year 2022 are a result of the non-cash listing fee expense and stock-based compensation awarded to Sparx employees, consultants and directors, as part of the reverse takeover, which occurred between March 23, 2022 to June 30, 2022.

The Company recognized $63,291 relating to recovery on a payable as a part of the IRS penalty relief program during the 2022 fiscal year.  In the previous year, the Company recognized $132,969 in other income through government grant income in relation to the Canada Emergency Business Account program. In addition, during the fiscal 2022 year $119,456 was recognized as government grant income as the US government forgave a material portion of the Company's Paycheck Protection Program loan.

Q4 – 2022
Revenues increased to $232,498 for the 3 months ended June 30, 2022, from $196,788 for the same period in 2021 as a result of additional contracts won by Sparx in the sports and media and entertainment space and recognized during the 2022 quarter.

Operating expenses decreased to $873,955 in Q4 of 2022 from $1,325,981 for the same period in 2021. The largest contributor to the decrease in operating expenses was the significant decrease in interest expense incurred, as the Company converted a significant portion of the Company's interest incurring debt on June 30, 2021, into common shares of the Company. Consulting fees saw an increase in Q4 2022 compared to the same period in 2021, as the Company increased the scope of services provided by their external IT consulting group to create a software as a service (SaaS) solution for the Sparx Studio product that the Company will bring to the public market in the 2023 fiscal year

Lastly, salaries and wages and stock-based compensation saw an increase in the fourth quarter of 2022 compared to the same period in the prior year as the Company added new employees while also providing some employees and directors with stock options in the Company.

On behalf of the Board

Al Thorgeirson

CEO and President

ABOUT SPARX:

Sparx is an interactive media technology company whose principal activities are providing media companies and sports teams with technologies to engage audiences. The patented Sparx platform enables broadcasters, streamers, and video producers to engage viewers for longer, generate new revenue opportunities, and create lean-forward experiences for audiences eager to join the action. Millions of users can connect to the Sparx platform and interact simultaneously on their mobile phone, tablet, or computer anywhere in the world, in real time.

For more information about Sparx, visit the Company's website at www.sparxtechnology.com

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.

Statements included in this news release, including statements concerning the Company's plans, intentions, and expectations, which are not historical in nature, are intended to be, and are hereby identified as, "forward‐looking statements". Forward-looking statements include, among other matters, the anticipated use of proceeds from the Financing. Forward‐looking statements may be, but are not always, identified by words including "anticipates", "believes", "intends", "estimates", "expects" and similar expressions. The Company cautions readers that forward‐looking statements, including without limitation those relating to the Company's future operations and business prospects, are subject to certain risks and uncertainties (including risks that the Transaction does not proceed, or proceed on the expected terms, geopolitical risk, regulatory, Covid-19 and exchange rate risk) that could cause actual results to differ materially from those indicated in the forward‐looking statements. There can be no assurance that any forward-looking statement will prove to be accurate or that management's assumptions underlying such statements, including assumptions concerning the Company or future developments, circumstances or results will materialize. The forward-looking statements included in this news release are made as of the date of this news release and the Company does not undertake to update or revise any forward-looking information included herein, except in accordance with applicable securities laws.

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SOURCE Sparx Technology Inc.