Mr. Paul Ghezzi reports

KONTROL ENERGY ANNOUNCES SECOND QUARTER 2018 RESULTS WITH 59 per cent REVENUE GROWTH

Kontrol Energy Corp. has released its Q2 2018 financial results for the six months ended June 30, 2018. Kontrol Energy continues to execute on its growth plans, with a focus on being cash flow positive through its operations.

Q2 2018 highlights:

• Six-month revenues of $4.3-million, up 59 per cent over the first six months of 2017;
• Q2 2018 revenues of $2.1-million, up 35 per cent over Q1 2017;
• Gross profit margin for Q2 2018 of 74 per cent;
• Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) of $47,159;
• On track for completion of purchase and sale agreement to acquire an emission equipment and integration company with approximately $6-million of annual revenues and $1-million of normalized annual earnings, based on the most recent acquiree's unaudited financial statements for its fiscal year ended July 31, 2018. Approximately 30 per cent of revenues are annual recurring and greater than 40 per cent of revenues are generated from U.S. customers. The anticipated closing of the acquisition is on or before Sept. 30, 2018, and the acquisition will be financed primarily through a non-convertible debt issuance;
• Growing backlog of power generation projects in development to add to 2018 revenues;
• Target anticipated 2018 revenues of approximately $11-million;
• Following the acquisition Kontrol anticipates approximately $16 Million in annual revenues on a 12-month run rate basis.

Positive adjusted EBITDA and acceleration to cash flow positive

"We had a strong second quarter, with revenues in line with expectations and much lower operating expenses were incurred, as compared with Q1 2018," commented Paul Ghezzi, chief executive officer of Kontrol Energy. "As we accelerate revenue growth into Q3 and Q4, and we close our next acquisition, Kontrol will be on course to be cash flow positive on a 12-month run rate basis. We remain focused on growing our top-line revenues in excess of 50 per cent per annum, while being profitable and improving cash flow generation. Kontrol is very pleased that we continue to expand operations while maintaining less than 27 million shares outstanding and less than 30 million shares fully diluted."

   
                                           FINANCIAL SUMMARY
  
                                   Three months ended June 30,            Six months ended June 30,
                                       2018              2017               2018              2017

Revenue                          $2,106,254        $1,558,830         $4,302,818        $2,708,510
Gross profit                      1,567,901         1,108,060          2,850,336         1,838,447
Net (loss)                         (329,995)         (467,185)        (1,330,930)         (724,828)
Add for adjusted EBITDA 
reconciliation                                           
Amortization and depreciation       237,589           103,691            504,277           155,964
Finance expense                     120,620           169,302            241,348           274,739 
Share-based compensation             18,945           200,000            189,345           200,000 
Adjusted EBITDA                      47,159             5,808           (395,960)          (94,125)

A complete set of financial statements and management's discussion and analysis have been filed on SEDAR.

About Kontrol Energy Corp.

Kontrol Energy is a leader in energy efficiency through Internet of things, cloud and blockchain technology. With a disciplined mergers and acquisition strategy, combined with organic growth, Kontrol Energy provides market-based energy solutions to its customers designed to reduce their overall cost of energy while providing a corresponding reduction in greenhouse gas (GHG) emissions.

We seek Safe Harbor.