Mr. Charles Salameh reports

SANGOMA ANNOUNCES SECOND QUARTER FISCAL 2024 RESULTS

Sangoma Technologies Corp. has released its second quarter financial results and unaudited condensed consolidated interim financial statements for the fiscal second quarter ended Dec. 31, 2023.

Sangoma's service revenue rose to $50.70-million, representing 81 per cent of total revenue in the second quarter of fiscal 2024. Products revenue was down, resulting in total revenue for the second quarter of $62.28-million, slightly higher from the same period in the prior year and a 1-per-cent decrease from the immediately preceding quarter.

The company continues to maintain a healthy balance sheet, finishing the quarter with net cash provided by operating activities of $9.19-million and a cash balance of $10.56-million on Dec. 31, 2023, reflecting a strong quarterly progression of cash flow. Cash conversion of cash flow from operations to adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) (2) during the second quarter reached 88 per cent, almost two times the rate compared with 47 per cent a year ago and 79 per cent from the immediately preceding quarter. Sangoma continues to remain comfortably within its debt covenants.

"We are currently immersed in the transformative journey outlined in the 100-day plan, a strategic initiative I initiated upon assuming the role of Sangoma's CEO. The entire Sangoma team has rallied together, aligning our efforts in unison across all facets of the business. Whether supporting our new enterprise architecture (EA) plan, including ERP, driving cost-saving measures, executing go-to-market strategies or optimizing day-to-day operations, I am exceptionally pleased and proud of the collective dedication within the Sangoma family," stated Charles Salameh, chief executive officer.

"In the realm of building organizations or skyscrapers, a solid foundation is paramount for sustained growth and stability. Our robust, transparent and well-maintained balance sheet serves as a crucial pillar in this foundation. Our unwavering focus on maintaining this financial bedrock is critical as we construct our new organizational structure atop it. We recognize the importance of financial strength in fostering investor confidence and ensuring the success of Sangoma's ventures."

Operating expenses (1) were $44.54-million for the quarter, slightly up from $44.26-million for the same period last year by about 1 per cent but have decreased by about 1 per cent compared with the immediately preceding quarter.

Net loss for the second quarter was $3.24-million, while adjusted EBITDA remained strong at $10.45-million, reflecting a 6-per-cent increase compared with Q1 of fiscal year 2024.

Conference call

Sangoma will host a conference call on Wednesday, Feb. 8, 2024, at 5:30 p.m. ET, to discuss these results. The dial-in number for the call is 1-800-319-4610 (international at 1-604-638-5340). Participants are requested to dial in five minutes before the scheduled start time and ask to join the Sangoma call.

(1) Operating expenses consist of sales and marketing, research and development, general and administration, and amortization of intangible assets.

(2) Adjusted EBITDA is a non-IFRS (international financial reporting standards) financial measure used by the company to monitor its performance and definitions of these terms along with reconciliation to the closest IFRS measure may be found in the company's MD&A (management's discussion and analysis), on page 17, posted today on SEDAR+ and on EDGAR.

About Sangoma Technologies Corp.

Sangoma is a leading provider of managed cloud-based communications and technology solutions for businesses worldwide. With a deep commitment to simplifying and enhancing communications, Sangoma offers a comprehensive suite of cloud-native communication solutions, including software, end points and connectivity services. With a focus on value-based offerings, Sangoma empowers businesses of all sizes to streamline their processes, reduce operational complexity and increase efficiency. Whether it be cloud software solutions, reliable end points or seamless connectivity, Sangoma's expert team is dedicated to delivering trusted and innovative services.

Sangoma is your one-stop solution for managed cloud communications services, making vendor management more straightforward and saving you valuable time.

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