Converge Technology Solutions Releases Preliminary Q4 and Fiscal Year 2024 Financial Outcomes
Converge Technology Solutions Corp. has recently provided key insights into its preliminary financial outcomes for the fourth quarter (Q4-2024) and the entire fiscal year that ended on December 31, 2024. The Calgary-based company, which operates on the Toronto Stock Exchange under the ticker CTS, noted several aspects of its financial performance that are worth analyzing in detail.
As per the latest report, Converge anticipates approximately $1.1 billion in gross sales for Q4-2024, marking a modest 2.5% increase compared to the same quarter from the previous year. When we delve deeper into the revenue figures, Converge expects revenue around $680.8 million, highlighting a 4.6% year-over-year growth.
Conversely, the company faces challenges regarding profitability, with an expected gross profit of about $178.6 million, which represents a slight decrease of 1.6% from the previous year. Importantly, their adjusted EBITDA is projected to be around $47.9 million, reflecting a marginal 3.0% increase, while cash generated from operating activities is expected to be approximately $57.0 million, equating to an impressive 119% of the adjusted EBITDA.
Notably, the company reports a loss before income taxes of $21.2 million, a substantial rise of $16.8 million year-over-year. This loss largely stems from significant impairments tied to investments in Portage CyberTech Inc., coming in at about $24.0 million.
Turning to the overall fiscal year, Converge forecasts $4.1 billion in gross sales, up 2.1% year-over-year. However, the revenue for the entire year is expected to decline, projected at $2.6 billion, representing a 4.2% decrease compared to fiscal year 2023.
Their gross profit is anticipated to be around $691.4 million, also experiencing a 1.6% regression annually. The adjusted EBITDA figures reflect a more considerable drop to approximately $167.3 million, down by 1.7% from the previous fiscal year. Cash generated from operations is expected to be around $269.4 million, highlighting a robust 161% of adjusted EBITDA.
However, it’s important to note that the company expects a loss before income taxes of approximately $200.5 million, representing a tremendous increase of $182.0 million year-over-year. This decrease is primarily attributed to an impairment loss in their German segment of $176.1 million along with a loss from Portage amounting to about $25.9 million.
To delve deeper into these financial performances, Converge's leadership team plans to host a conference call scheduled for March 6, 2025, at 8:00 AM EST. The management will provide comprehensive insights into the financial results and also address any questions posed during the call. This proactive approach aims to ensure transparency and provide clarity to stakeholders regarding the company's financial health and future strategies.
As investors and analysts alike await the finalized figures, it is crucial to contextualize these preliminary results within the broader scope of Converge’s strategic objectives and the actual financial landscape facing the technology sector. Factors such as market conditions, operational efficiency, and expected future growth opportunities will play pivotal roles in influencing Converge’s trajectory moving forward. Converge Technology Solutions remains steadfast in its mission to redefine IT solutions, focusing on customer-driven outcomes despite the seemingly challenging fiscal landscape they currently navigate.
For those interested in participating in the upcoming conference call, registration links and details for dial-in numbers will be available through Converge's investor relations portal. Stakeholders are encouraged to connect at least 15 minutes prior to the scheduled start time to ensure a smooth experience.
In summary, while Converge Technology Solutions has flagged some concerning figures related to impairments and revenue declines, its growth in gross sales paired with a proactive approach in addressing financial challenges sheds light on its potential to navigate through these uncertainties effectively.
Q4 2024 Preliminary Outcomes
As per the latest report, Converge anticipates approximately $1.1 billion in gross sales for Q4-2024, marking a modest 2.5% increase compared to the same quarter from the previous year. When we delve deeper into the revenue figures, Converge expects revenue around $680.8 million, highlighting a 4.6% year-over-year growth.
Conversely, the company faces challenges regarding profitability, with an expected gross profit of about $178.6 million, which represents a slight decrease of 1.6% from the previous year. Importantly, their adjusted EBITDA is projected to be around $47.9 million, reflecting a marginal 3.0% increase, while cash generated from operating activities is expected to be approximately $57.0 million, equating to an impressive 119% of the adjusted EBITDA.
Notably, the company reports a loss before income taxes of $21.2 million, a substantial rise of $16.8 million year-over-year. This loss largely stems from significant impairments tied to investments in Portage CyberTech Inc., coming in at about $24.0 million.
Fiscal Year 2024 Preliminary Results
Turning to the overall fiscal year, Converge forecasts $4.1 billion in gross sales, up 2.1% year-over-year. However, the revenue for the entire year is expected to decline, projected at $2.6 billion, representing a 4.2% decrease compared to fiscal year 2023.
Their gross profit is anticipated to be around $691.4 million, also experiencing a 1.6% regression annually. The adjusted EBITDA figures reflect a more considerable drop to approximately $167.3 million, down by 1.7% from the previous fiscal year. Cash generated from operations is expected to be around $269.4 million, highlighting a robust 161% of adjusted EBITDA.
However, it’s important to note that the company expects a loss before income taxes of approximately $200.5 million, representing a tremendous increase of $182.0 million year-over-year. This decrease is primarily attributed to an impairment loss in their German segment of $176.1 million along with a loss from Portage amounting to about $25.9 million.
Conference Call Information
To delve deeper into these financial performances, Converge's leadership team plans to host a conference call scheduled for March 6, 2025, at 8:00 AM EST. The management will provide comprehensive insights into the financial results and also address any questions posed during the call. This proactive approach aims to ensure transparency and provide clarity to stakeholders regarding the company's financial health and future strategies.
As investors and analysts alike await the finalized figures, it is crucial to contextualize these preliminary results within the broader scope of Converge’s strategic objectives and the actual financial landscape facing the technology sector. Factors such as market conditions, operational efficiency, and expected future growth opportunities will play pivotal roles in influencing Converge’s trajectory moving forward. Converge Technology Solutions remains steadfast in its mission to redefine IT solutions, focusing on customer-driven outcomes despite the seemingly challenging fiscal landscape they currently navigate.
For those interested in participating in the upcoming conference call, registration links and details for dial-in numbers will be available through Converge's investor relations portal. Stakeholders are encouraged to connect at least 15 minutes prior to the scheduled start time to ensure a smooth experience.
In summary, while Converge Technology Solutions has flagged some concerning figures related to impairments and revenue declines, its growth in gross sales paired with a proactive approach in addressing financial challenges sheds light on its potential to navigate through these uncertainties effectively.
Topics Business Technology）
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