Ms. Miriam Tuerk reports

CLEAR BLUE TECHNOLOGIES PROVIDES Q4 2023 CORPORATE UPDATE

Clear Blue Technologies International Inc. has provided a Q4 2023 corporate update, including preliminary fourth quarter financial results.

Q4 2023 update -- telecom segment strength drove Q4 outperformance:

• Revenue is expected to be $2.1-million (up $1,922,000 from $178,000 in Q4 2022 and almost equal to Q3 2023, which was $2.2-million), exceeding the previously announced Q4 guidance range of $1.8-million to $2-million. Q4 continued to exhibit very strong gross margins in line with previous periods (37 per cent in Q3 2023).
• Revenue was distributed across all business units:
  • Nano-Grid systems are expected to be approximately 25 per cent of revenue for 2023. Global investments in satellite technology to bring satellite as a viable alternative to ground-based microwave and cellular systems are driving community Internet services and rural deployments. Solar green energy funds are also moving into the sector to fund solar deployments for telecom, bringing fresh funding to drive projects;
  • Illumient systems are expected to contribute approximately 29 per cent of for 2023. Solar lighting growth in North America is expected to be driven by recent legislation in the United States and Canada. Customers' increasing requirements for resiliency against extreme weather are also helping drive growth in this segment. Illumient provides the benefit of having the lights on when the grid goes down while eliminating pole-to-pole cabling risks;
  • Esite-Micro systems are expected to represent approximately 46 per cent for 2023. Esite services existing installations of traditional larger cell towers. The majority of these have historically been grid- or grid- and diesel-powered. The cost of diesel is up 300 per cent or more since 2021, and the grid is becoming less reliable. Not only is the cost of diesel driving adoption, but also the greening of telecom sites is a major focus across the industry. These sites are being converted to hybrid-powered systems, including solar. As a result, Clear Blue is seeing significant customer interest in investments and programs in upgrading existing telecom sites. These investments will convert grid and diesel dependence toward solar energy.
• In the quarter the company shipped 616 power control devices across 14 orders.
• Clear Blue converted a previously announced Parallel Wireless project to a full Esite-Micro solution, which shipped in Q4. The impact on Q4 revenue is expected to be $1.1-million. Revenue in 2024 is expected to be significantly greater than 2023 and 2022 revenue, which were $5.4-million and $2.6-million, respectively. With typical business seasonality, strong sales orders in the first half of the year lead to stronger revenue in the second half of the year. Clear Blue's business growth has accelerated following a challenging 2022 and 2023. This is expected to lead to increased order intake in 2024, followed by revenue growth.
• Clear Blue's funnel indicates significant growth going into 2024. All product lines and verticals are expected to exhibit strong growth in both sales and revenue. Each of Nano, Micro and Illumient will deliver approximately one-third of the revenue with Pico-Grid beginning to deliver as the sales go to market for this product ramps up. In addition to its base plan, the company is tracking a few very large seven-figure orders which could close by midyear. While there can be no assurance on timing or any specific order closing, they are indicative of the large investments being made by industry and the opportunity going forward for Clear Blue.
• The cash position at the end of the quarter was $500,000, approximately $2-million of accounts receivables and $2-million in non-dilutive capital from across government programs all expected in early 2024.

"The fourth quarter of 2023 saw the company's quarterly performance continue on its pre-COVID trajectory even as significant costs have been removed from the business," said Miriam Tuerk, chief executive officer of Clear Blue. "Two thousand twenty-three saw a return to growth, and we expect to see continued demand for our Illumient, Nano-Grid and Esite products throughout 2024. We believe our robust and growing pipeline is providing us increased visibility into order intake for 2024, driven by recent customer signals of market scale for our technology. These opportunities cumulatively represent an order pipeline in the low hundreds of millions of dollars, providing Clear Blue room for years of strong revenue growth."

Outlook

Clear Blue has a strong 2024 sales funnel for each product. All products are expected to achieve meaningful growth with revenue split fairly evenly across each unit.

Potential Illumient order flow includes another interstate highway interchange project, multiple indigenous first nations projects and follow-on roadway projects with an existing city in the U.S. Northeast.

Nano-Grid was materially impacted by financing delays on rural telecom orders in 2021 and 2022. Clear Blue now has multiple customers in late stages of financings and expects to see growth to return to that business throughout 2024. The company also expects to see a ramp-up in satellite/Wi-Fi projects.

With the launch of Clear Blue's smart off-grid software service for Esite-Micro, the company looks forward to providing continued reliable power for large telecom systems in 2024 and beyond. In addition to the previously announced Watt Renewable order, several additional projects are expected in the first half of 2024.

Lastly, 2024 is the first full year of sales of the Pico-Grid product. As sales ramp up, it is expected to be a major revenue driver going into 2025.

About Clear Blue Technologies International Inc.

Clear Blue Technologies International, the Smart Off-Grid company, was founded on a vision of delivering clean, managed, wireless power to meet the global need for reliable, low-cost, solar and hybrid power for lighting, telecom, security, Internet of Things devices and other mission-critical systems. Today, Clear Blue has thousands of systems under management across 37 countries, including the U.S. and Canada.

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