Kontrol Energy Reports 36% Quarterly Revenue Growth and Provides Operational Update

Toronto, August 28, 2017 - Kontrol Energy Corp. (CSE:KNR) (the "Company") announces quarterly revenue growth of 36% for Q2 2017. Revenues for Q2 were $1.56 Million compared to $1.15 Million in Q1. Year to date Q2 revenues were $2.7 Million.  The increase in revenue follows the acquisition of ORTECH Consulting Inc. (“ORTECH”) in February 2017, but does not reflect the acquisition of Efficiency Engineering Inc.  (“EE”) which was completed in August 2017. “We are very pleased with the acceleration of revenues and EBITDA,” says Paul Ghezzi, CEO Kontrol Energy. “As we look forward from Q3 2017 and 12 months out we anticipate a continuation of increased revenue generation and EBITDA growth with the current acquisitions completed and the multiple potential acquisitions in various stages of due diligence.”

EBITDA before non-cash expenses for Q2 was break-even, which is in line with the Company’s performance expectations and business plan. Factoring in non-cash amortization expense of $104K, stock based compensation of $200K and finance expenses of $169K the Company reports a net loss of $467,185 for the three months ended June 30, 2017.

Operational Update 

ORTECH

For more than 30 years, ORTECH has been a leader in Greenhouse Gas Measurement, Air Quality testing and Renewable Energy power consulting in Ontario. The anticipated operating revenue for the next 12 months is approximately in the range of $5.5 Million with net earnings of approximately $1 Million. The macro-economics of Greenhouse Gas emission and stack testing remain strong which benefits ORTECH’s ongoing revenues.

Efficiency Engineering

Since 1990, Efficiency Engineering Inc. (EE) has been providing technical assessment, financial assessment, detailed design, and management for building upgrade projects. EE work with customers to provide thorough and cost-effective energy auditing, monitoring & verification (M&V), energy project assessment, mechanical, electrical and renewable design, and LEED facilitation. EE will design and manage facility systems solutions, with emphasis on economic feasibility and energy savings.  The anticipated operating revenues for the next 12 months is in the range of $2.75 Million with $500,000 in net earnings. 

Kontrol Technologies

The Kontrol Technologies operating division delivers turn-key retrofit and technology solutions to various commercial real estate owners and stakeholders. Included in the Kontrol Technologies division is the Kontrol EMS (smart energy thermostat). The anticipated operating revenues for the next 12 months is in the range of $2.25 Million with $450,000 in net earnings.

The Kontrol EMS is moving through an upgrade of hardware and software to be an Internet of Things (IOT) device. To date approximately $100,000 has been invested in the upgrade and over the next 6 months an additional $100,000 will be required. The majority of this eligible for SRED credits and various Federal grants for efficiency which Kontrol continues to explore.

Consolidated

The consolidated revenues are anticipated to be in the range of $10.5 Million over the next 12 months. The net EBITDA, after corporate overhead, is anticipated to be in the range of $1.3 Million. This is consistent with prior guidance but reflects a 12-month run rate as opposed to a calendar year. According to the International Energy Association 2016 Report, energy efficiency is the first fuel of the global economy and continues to be the invisible powerhouse to improve energy security, lower energy bills and move us closer to reaching climate change goals. Each $1 invested in energy efficiency can displace up to $3 in transmission and distribution costs.

“The consolidated group of Kontrol operating subsidiaries has delivered over $100 million in electricity savings over their past combined operating history with a corresponding reduction in Greenhouse Gas emissions,” continues Paul Ghezzi.” With 4 acquisitions now completed we are well on our way to growing our consolidated operating footprint to take advantage of the significant opportunities in the global energy efficiency sector.”

About Kontrol Energy Corp.

Kontrol Energy Corp. (CSE:KNR) is a leader in energy efficiency solutions and technology. Through a disciplined mergers and acquisition strategy, combined with organic growth, Kontrol Energy Corp. provides market-based energy solutions to our customers designed to reduce their overall cost of energy while providing a corresponding reduction in Greenhouse Gas (GHG) emissions.

Additional information about Kontrol Energy Corp. can be found on its website at www.kontrolenergy.com and by reviewing its profile on SEDAR at www.sedar.com

For further information: Paul Ghezzi, CEO paul@kontrolenergy.com;

Kontrol Energy Corp. 5045 Orbitor Drive Bldg. 9, Suite 401 Mississauga, ON L4W 4Y4

Tel: 905.766.0400 Toll free: 1.844.866.8123

Neither IIROC nor any stock exchange or other securities regulatory authority accepts responsibility for the adequacy or accuracy of this release. 

Caution Regarding Forward Looking Statements:

Certain information included in this press release, including information relating to future payments of holdback amounts, possible future acquisitions, anticipated consolidated revenue and anticipated annual EBITDA; the provision of solutions to customers to reduce overall energy costs and greenhouse gas emissions reductions, carbon reduction and monetization programs, growth strategy, the replacement of the secured bridge loan with long-term senior secured debt financing and other statements that express the expectations of management or estimates of future performance constitute "forward-looking statements". The forward-looking statements in this press release are presented for providing information about management's current expectations and plans and such information may not be appropriate for other purposes. The forward-looking statements. Where the Company expresses or implies an expectation or belief as to future events or results, such expectation or belief are based on assumptions made in good faith and believed to have a reasonable basis. Such assumptions include, without limitation, that acquired companies will be successfully integrated into the Company and that its revenues will be consistent with the Company's expectations, that suitable businesses and technologies for acquisition and/or investment will be available, that such acquisitions and or investment transactions will be concluded, that sufficient capital will be available to the Company, that technology will be as effective as anticipated, that organic growth will occur, that the Company will succeed in obtaining long-term senior secured debt financing, and others. However, forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed, projected or implied by such forward-looking statements. Such risks include, but are not limited to, lack of acquisition and investment opportunities or that such opportunities may not be concluded on reasonable terms, or at all, that sufficient capital and financing cannot be obtained on reasonable terms, or at all, that technologies will not prove as effective as expected that customers and potential customers will not be as accepting of the Company's product and service offering as expected, and government and regulatory factors impacting the energy conservation industry. Accordingly, undue reliance should not be placed on forward-looking statements and the forward-looking statements contained in this press release are expressly qualified in their entirety by this cautionary statement. The forward-looking statements contained herein are made as at the date hereof and the Company does not undertake any obligation to update publicly or revise any such forward-looking statements or any forward-looking statements contained in any other documents whether as a result of new information, future events or otherwise, except as required under applicable securities law.