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Cortex Business Solutions Announces Q1 and Fiscal 2019 Financial Results

December 5, 2018

CALGARY, Alberta, Dec. 04, 2018 (GLOBE NEWSWIRE) -- Cortex Business Solutions Inc. (“Cortex”) (TSXV: CBX), a North American network-as-a-service complete document management & e-invoicing solutions provider, today announces its three months ended October 31, 2018 (“Q1 F2019”) Management’s Discussion and Analysis (“MD&A”) and Condensed Consolidated Interim Financial Statements (“F/S”). The MD&A and F/S are available at www.sedar.com.

“With our first months now behind us after the Powervision acquisition, we are already starting to see the synergies that we had expected from combining the two companies. We have made two new sales of the complete Cortex platform since the acquisition and our pipeline for the combined solution is growing rapidly,” said Joel Leetzow, President and CEO.

“As the Company’s key performance indicators including revenue and Adjusted EBITDA benefit from the Powervision acquisition and our new Intelligent Invoice Approval product release, we also had approximately $0.3 million of non-recurring expenses associated with the acquisition in this quarter. The second quarter F2019 will include full quarter consolidated results of Powervision and we look forward to Adjusted EBITDA growth as we complete new sales and new economies of scale,” said Jason Baird, VP, Finance & CFO.

Q1 F2019 Financial Highlights

Three months ended October 31, 2018 compared to October 31, 2017

-- Adjusted EBITDA(1) increased 29% or by $0.2 million from $0.5 million to $0.7 million -- Adjusted EBITDA % Margin(2) increased by 3% from 16% to 19% -- Cash flow from operating activities increased 52% from $0.3 million to $0.5 million -- Overall revenue increased 3% or by $0.1 million from $3.2 million to $3.3 million -- Access and usage fees increased 16% or by $0.5 million from $2.8 million to $3.3 million -- Gross profit remained flat at $2.4 million

Cash Position

The overall cash position of Cortex reduced 51% or $4.2 million from $8.2 million at July 31, 2018, to $4.0 million at October 31, 2018. Net cash provided by operating activities of $0.5 million, in conjunction with the cash position at F2018 provided the flexibility to prudently use $4.8 million for the acquisition of Powervision in September 2018.

1. Adjusted EBITDA is defined as earnings before interest, taxes, depreciation and amortization, non-recurring charges and share based payments. Adjusted EBITDA is a non-IFRS financial measure that does not have any standardized meanings prescribed by IFRS and therefore may not be comparable to similar measures presented by other reporting issuers. This measure assists the Company in evaluating the Company’s operating performance against its expectations and against other entities. Please refer to the Company’s MD&A for the quarter and year ended July 31, 2018 for further information on the Company’s use of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to Net Income. 2. Adjusted EBITDA % Margin is the Adjusted EBITDA divided by Total revenue.

Cortex’s Management will host a conference call, followed by a question and answer period.

The details of the conference call are as follows:

Date: Thursday, December 6th, 2018 Time: 11:00 a.m. Eastern time (9:00 a.m. Mountain time) Toll-free dial-in number: 1-800-273-9672 International dial-in number: 1-416-340-2216

Please call the conference telephone number ten minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Cortex at 403-219-2838.

A replay of the conference call will be available after the call through December 13, 2018.

Toll-free replay number: 1-800-408-3053 Toll replay number: 1-905-694-9451 Replay ID: 1503476#

About Cortex

Cortex is a service-centric, digital transformation solutions provider focused on revolutionizing B2B document exchange. We help businesses save time and money by replacing traditional paper-based manual systems with AP and AR invoice automation. Companies on the Cortex Network are positioned for success with solutions that offer the scalability and flexibility needed to evolve with their unique business needs. Cortex specializes in the development and delivery of integrated electronic document intake and management solutions using flexible connection methods that leverage existing technologies and processes.

Cortex is currently enabling digital transformation in over 11,000 companies in the Oil & Gas, Mining, Manufacturing and Sports & Entertainment industries. For more information, please visit www.cortex.net.

Investor Relations Contacts:

Joel Leetzow Jason Baird President and CEO VP, Finance & CFO jleetzow@cortex.net jbaird@cortex.net 403-219-2838 403-219-2838

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

Cortex Business Solutions Inc. Consolidated Statement of Financial Position (Prepared in Canadian Dollars) (Unaudited)

October 31 July 31 2018 2018 Assets Current Assets Cash and cash equivalents $ 4,026,861 $ 8,197,785 Cash held in escrow for acquisitions 500,000 - Short-term investments 60,773 60,000 Accounts receivable 1,178,127 907,108 Prepaid expenses 180,148 167,822 - ----------- - - ----------- - 5,945,909 9,332,715 Long-term receivable 109,822 131,785 Deposits 32,379 32,379 Contracts assets 66,179 - Property and equipment 163,898 148,479 Deferred tax assets 2,661,919 2,758,000 Intangible assets 3,252,888 21,012 Goodwill 4,481,329 - - ----------- - - ----------- - $ 16,814,323 $ 12,424,370 - ----------- - - ----------- - Liabilities Current Liabilities Accounts payable and accrued liabilities $ 1,916,813 $ 1,197,295 Deferred revenue 470,535 309,967 Current income tax payable 23,458 20,858 Current portion of obligations under finance lease 22,923 22,923 Current portion of promissory note 1,528,290 - - ----------- - - ----------- - 3,962,019 1,551,043 Deferred rent 131,624 141,035 Obligations under finance lease 8,079 13,801 Promissory note 745,479 - - ----------- - - ----------- - 4,847,201 1,705,879 - ----------- - - ----------- - Shareholders’ Equity Share capital 60,771,418 60,771,418 Accumulated other comprehensive income 632,675 620,433 Contributed surplus 9,933,317 9,881,276 Deficit (59,370,288 ) (60,554,636 ) 11,967,122 10,718,491 - ----------- - - ----------- - $ 16,814,323 $ 12,424,370 - ----------- - - ----------- -

Cortex Business Solutions Inc. Consolidated Statement of Income and Comprehensive IncomeFor the three months ended October 31, 2018 and 2017(Prepared in Canadian Dollars) (Unaudited)

Three months ended October 31 2018 2017 Revenue Access and usage fees $ 3,261,753 $ 2,809,912 Integration fees 30,111 86,561 Project management and other revenue 43,668 338,200 3,335,532 3,234,673 Cost of Sales 925,357 832,300 Gross Profit 2,410,175 2,402,373 - --------- - - --------- Expenses Sales and marketing 663,631 689,969 Research and development 529,640 477,587 General and administrative 940,807 797,419 Severance and termination - 155,922 2,134,078 2,120,897 Income before finance income 276,097 281,476 Finance income 21,873 7,096 Income tax expense - current 2,379 2,108 Income tax (recovery) - deferred (814,629 ) - Net income $ 1,110,220 $ 286,464 - --------- - - --------- Other comprehensive earnings Items that may be reclassified subsequently to net income: Foreign exchange gain on foreign operations 12,242 13,936 Comprehensive income $ 1,122,462 $ 300,400 - --------- - - --------- Net income per share – basic and diluted $ 0.12 $ 0.03 - --------- - - ---------

Cortex Business Solutions Inc. Consolidated Statement of Changes in Shareholders’ Equity (Prepared in Canadian Dollars) (Unaudited)

Number of Accumulate Total Share d Other Contributed Shareholders’ Common Capital ComprehensSurplus Deficit Shares ive Equity Income Balance – July 31, 2017 9,069,983 $ 60,562,286 $ 591,752 $ 9,526,341 $ (64,896,501 ) $ 5,783,878 Net income - - - - 286,464 286,464 Translation of foreign operations - - 13,936 - - 13,936 Compensation units & stock options 21,158 70,290 - (24,040 ) - 46,250 exercised Stock based compensation - - - 65,947 - 65,947 --------- - ---------- - ------- - --------- - - ----------- - - ---------- Balance – October 31, 2017 9,091,141 60,632,576 605,688 9,568,248 (64,610,037 ) 6,196,475 --------- - ---------- - ------- - --------- - - ----------- - - ---------- Balance - July 31, 2018 9,137,700 60,771,418 620,433 9,881,276 (60,554,636 ) 10,718,491 IFRS 15 net opening adjustment - - - - 74,128 74,128 Balance - August 1, 2018 9,137,700 60,771,418 620,433 9,881,276 (60,480,508 ) 10,792,619 --------- - ---------- - ------- - --------- - - ----------- - - ---------- Net income - - - - 1,110,220 1,110,220 Translation of foreign operations - - 12,242 - - 12,242 Stock based compensation - - - 52,041 - 52,041 --------- - ---------- - ------- - --------- - - ----------- - - ---------- Balance – October 31, 2018 9,137,700 60,771,418 632,675 9,933,317 (59,370,288 ) 11,967,122 --------- - ---------- - ------- - --------- - - ----------- - - ----------

Cortex Business Solutions Inc. Consolidated Statement of Cash FlowsFor the three months ended October 31, 2018 and 2017(Prepared in Canadian Dollars) (Unaudited)

Three months ended October 31 2018 2017 Cash provided by (used in) Operating activities Net income $ 1,110,220 $ 286,464 Items not affecting cash Recovery for deferred taxes (814,629 ) - Stock-based compensation 52,041 65,947 Amortization 55,812 150,294 Deferred Rent (9,411 ) 79,923 Contract Assets 7,949 - Long term receivables 21,963 (25,974 ) Changes in non-cash working capital 53,631 (242,791 ) - ---------- - - --------- - Net cash provided by operating activities 477,576 313,863 - ---------- - - --------- - Financing activities Proceeds on exercise of compensation units & stock options - 46,250 Finance lease payments (5,722 ) (12,993 ) - ---------- - - --------- - Net cash provided by (used in) financing activities (5,722 ) 33,257 - ---------- - - --------- - Investing Activities Cash paid on Powervision acquisition, net of cash assumed (4,124,141 ) - Additions to cash held in escrow (500,000 ) - Additions to short-term investments (773 ) - Acquisition of property and equipment (30,106 ) (16,231 ) - ---------- - - --------- - Net cash used in investing activities (4,655,020 ) (16,231 ) - ---------- - - --------- - Effect of exchange rate changes on cash and cash equivalents held in foreign currency 12,242 13,933 - ---------- - - --------- - Cash (outflow) inflow (4,170,924 ) 344,822 Cash, beginning of year 8,197,785 6,248,176 - ---------- - - --------- - Cash, end of year $ 4,026,861 $ 6,592,998 - ---------- - - --------- - Supplemental cash flow information Interest received during the year $ 22,610 $ 14,442 - ---------- - - --------- -

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