Mr. Rich Wheeless reports

PARCELPAL LOGISTICS INC. REPORTS ALL-TIME RECORD RESULTS SINCE INCEPTION AND THIRD QUARTER 2023 RESULTS HIGHLIGHTED BY A COMPANY-WIDE NEAR BREAKEVEN BOTTOM LINE, RECORD MARGINS AND RECORD REVENUE

Parcelpal Logistics Inc. has released its record Q3 2023 financial results, highlighted by revenue growth of 39 per cent (to approximately $3.7-million), continued record gross margins of 39.6 per cent and a 91-per-cent decrease in net loss (from $1.2-million in Q3 2022 to $103,000 in Q3 2023). It is important to note that this was the company's largest Q3 of gross revenue (and an all-time record since inception for the company, with the previous high being Q4 2022, which was $3.4-million). It is very possible that, with the additional operational efficiencies Parcelpal has been implementing that the fourth quarter of 2023 will be fully profitable. Simply, this is substantial and very positive operational progress and the best quarter all around in the history of Parcelpal. Additionally, Parcelpal reported that October was profitable for the company and Parcelpal will be providing an update on its November financial results soon.

Overview

In Q3 2023, the company achieved its largest quarter of revenue ever, which was driven by revenue growth of 40 per cent to approximately $3.7-million (up from $2.6-million in Q3 2022). Parcelpal's gross margins for Q3 were a record 39.6 per cent (compared with 12.0 per cent in Q3 2022). Additionally, the company had a net loss of only $103,685, compared with Q3 2022, which was $1,192,589 (a 91-per-cent decrease in net loss). It is important to note that approximately $332,000 of non-cash related items, such as amortization and foreign exchange expense drove the small net loss in Q3 2023.

Parcelpal is very pleased with the positive trends in its business operations, which are now primarily in the United States. As previously reported, Parcelpal's U.S. operations became profitable beginning in June, 2023, and continue to be profitable.

Parcelpal's revenue growth and continued record margins are, in large measure, driven by the company's expansion into the United States, which is the world's largest consumer market, combined with improved operating efficiencies.

Parcelpal's chief executive officer, Rich Wheeless, stated: "We just had an all-time record quarter all around, which I could not be prouder of. The business side of the company has never been in a better position than it has been under my tenure, despite what has been a volatile economy and market conditions. We hit another major milestone with the United States side being fully net profitable for back-to-back quarters across all divisions for the first time in the history of the company, which we believe will continue moving forward. I also note that we, as a publicly traded company, have been operating in an extremely challenging stock market for small and microcap stocks. These broader market conditions have negatively affected our stock price, and the intrinsic market value of our company has not been recognized. We fully intend to bring this positive growth and expansion story more fully to the market to attain greater shareholder value. Despite these headwinds, we have expanded geographically and achieved record growth and I am extremely excited about the additional opportunities that are in front of us, which I believe will allow us to continually expand the business on a profitable basis. Additionally, I am going to focus resources on additional business opportunities that will allow us to scale faster into new markets and with a lower capital cost as well."

Q3 2023 financial highlights

Sept. 30, 2023, compared with Sept. 30, 2022 -- financial highlights:

• Record revenue in Q3 2023 and growth of 39.1 per cent to $3,644,712 (up from $2,620,506 in Q3 2022); this represents the company's largest revenue quarter since inception (Q4 2022 of $3.4-million was the previous largest revenue quarter ever);
• Record gross margins in Q3 2023 of 39.6 per cent (up from 12.0 per cent in Q3 2022);
• Professional fees decreased to $94,162 (Q3 2022: $195,130) due to lower legal and accounting fees in Q3 2023;
• Marketing and promotion increased to $149,107 in Q2 2023 (Q3 2022: $49,705) as the company is working to tell the story and get it in front of new eyes;
• Office and miscellaneous expenses increased to $921,822 (Q3 2022: $334,485) related to the increased growth and consolidated operations of trucking and Parcelpal USA;
• Cash of $282,234 at Sept. 30, 2023, compared with $76,661 at Dec. 31, 2022, and vehicles and right-of-use assets of $408,662, compared with $507,669 at Dec. 31, 2022;
• During the quarter ended Sept. 30, 2023, the company's U.S. operations continued to be net positive, and the company's overall (including now-closed Canadian operations), net loss was only $103,685 (compared with $1,192,589 in Q3 2022);
• Net cash flows provided by operating activities was $277,000 for the nine months ended Sept. 30, 2023, versus net cash flows used in operating activities of $1.2-million for the nine months ended Sept. 30, 2022.

Subsequent to the period ended Sept. 30, 2023, a few notable events occurred, including:

• On Oct. 17, 2023, the company announced it will be shifting a significant amount of its focus and resources on its growing U.S. operations, with the focus to enter into new profitable contracts primarily/solely in the United States and shedding any money losing business units and/or contracts immediately. To this end, Parcelpal has terminated its largest Canadian contract on a mutually agreeable basis with its customer.
• On Nov. 7, 2023, the company announced that it had another month of operating profitability (approximately $50,000 (U.S.) in its U.S. business, led by a record 28-per-cent gross margin, for the month of October, 2023. This was driven by more profitable business with Parcelpal's second-largest customer.
• On Nov. 14, 2023, the company announced that it has extended its contract with its second-largest customer for at least another year. This customer accounts for approximately 20 per cent of the company's top-line revenue and is growing with Parcelpal. Additionally, the terms of the renewed contract are more favourable for Parcelpal with increasing rates on deliveries and higher package counts.

Outlook

The company's strategic priorities for the remainder of fiscal 2023 include:

• Continued improvement in operating performance and continued development and reintroduction of Parcelpal's new and improved technology platform;
• Building an exceptional and world-class brand with a focus on signing additional quality partners;
• Using data, technology and inbound selling to ramp up sales and revenue generation;
• Seeking synergistic and/or other business opportunities that diversify the company's revenue sources both for top-line revenue growth and on a profitable basis.
• Continued expansion into large markets in the United States and further expanding throughout the global markets, including with new higher margin customer contracts and/or additional regions.

The company's complete quarterly financial results are available in its unaudited financial statements and management discussion and analysis for the quarter ended Sept. 30, 2023, each of which has been filed with Canadian and U.S. securities regulatory agencies and can be found respectively at on SEDAR+ and the U.S. Securities and Exchange Commission's website.

The company looks forward to providing additional material updates in the coming weeks.

About Parcelpal Logistics Inc.

Parcelpal is a Vancouver, B.C., company that specializes in last-mile delivery service and logistics solutions. Parcelpal is a customer-driven courier and logistics company connecting people and businesses through its network of couriers. Some of Parcelpal's verticals include pharmacy and health, meal kit deliveries, retail, groceries, and more.

We seek Safe Harbor.