Saltire Capital Ltd. Reports Q1 2025 Financial Results

TORONTO, May 12, 2025 /CNW/ - Saltire Capital Ltd. (TSX: SLT.U) (TSX: SLT) (TSX: SLT.WT.U) (TSX: SLT.WT) ("Saltire" or the "Company") today reported its unaudited financial results for the three-month period ended March 31, 2025. The Company's unaudited condensed consolidated interim financial statements ("Financial Statements") and management's discussion and analysis ("MD&A") have been filed on the System for Electronic Document Analysis and Retrieval Plus ("SEDAR+") and may be viewed under the Company's profile at www.sedarplus.ca. All references to "$" herein are to United States Dollars.

Q1 2025 Highlights

For the three months ended March 31, 2025, the Company reported revenue of $4.3 million, representing an increase of 24.9% compared to revenue of $3.5 million for the three months ended March 31, 2024. The growth in revenue was primarily driven by a 39% increase in cinema-related sales, reflecting robust order volumes from major clients. Non-cinema and special project revenues also contributed positively, increasing by 16% quarter-over-quarter, supported by immersive content deliveries. Gross profit for the quarter was $1.8 million, compared to $1.4 million in the prior year period, representing a 31.3% increase. The increase was attributable to improved production floor efficiencies, favorable procurement, and a higher proportion of premium-margin products, such as IMAX^® certified screens*. Margin improvement also benefited from better absorption of fixed manufacturing costs as volumes increased.

Operating income for Q1 2025 was $0.6 million, compared to $0.7 million for Q1 2024. The slight decline was primarily due to higher general and administrative expenses, including payroll, legal, and compliance costs, following the Company's transition as an operating public company after the Qualifying Acquisition (as defined below) in 2024. Net income for the quarter was $10.3 million, compared to $0.6 million for the prior year period. The significant increase was mainly driven by a gain of $10.1 million related to the fair value remeasurement of warrant liabilities, which are non-cash in nature.

Earnings before interest, taxes, depreciation and amortization ("EBITDA") for Q1 2025 was $10.8 million, compared to $1.0 million in Q1 2024, with the increase similarly driven by the warrant valuation gain. Adjusted EBITDA, which excludes the fair value remeasurement of warrants and other non-operating items, was $0.7 million, compared to $1.0 million in Q1 2024. The decline in Adjusted EBITDA reflects increased operating expenses as a reporting issuer, partially offset by stronger sales and improved gross margins. "EBITDA" and "Adjusted EBITDA" are non-IFRS measures. See "Non-IFRS Measures" below.

"MDI's performance this quarter reflects the operational strength and market position we envisioned when acquiring the business", said Andrew Clark, CEO of Saltire. "The company continues to benefit from strong demand in premium cinema formats and immersive entertainment, while also improving manufacturing efficiency. With a robust sales pipeline heading into the second quarter, we remain confident in MDI's trajectory and are focused on long-term value creation for Saltire shareholders."

*IMAX^® is a registered trademark of IMAX Corporation.

Non-IFRS Measures

EBITDA and Adjusted EBITDA are not recognized measures under IFRS and do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement the IFRS measures disclosed in the Financial Statements by providing further understanding of Saltire's results of operations from management's perspective. Accordingly, these measures should neither be considered in isolation nor as a substitute for analysis of the Company's financial information reported under IFRS.

EBITDA and Adjusted EBITDA are used to provide shareholders with supplemental measures of the Company's operating performance and thus highlight trends in the Company's business that may not otherwise be apparent when relying solely on IFRS measures.

Securities regulations require non-IFRS measures to be clearly defined and reconciled with their most directly comparable IFRS measure. Management believes that EBITDA and Adjusted EBITDA are useful measures to assess the performance of the Company as they provide more meaningful operating results by excluding the effects of items that are not reflective of underlying business performance and other one-time or non-recurring items.

The following table provides the reconciliation of net income to EBITDA and Adjusted EBITDA for the three-month periods ended March 31, 2025 and 2024:

(in millions)	Q1 2025	Q1 2024
Net Income	$10.26	$0.60
Interest Expense	$0.17	$0.13
Income Tax Expense	$0.25	$0.16
Depreciation & Amortization	$0.12	$0.13
EBITDA	$10.80	$1.03
Fair Value Gain on Warrants	$(10.11)	–
Stock-Based Compensation	$0.05	$0.01
Adjusted EBITDA	$0.74	$1.04

Qualifying Acquisition and Private Placement

As previously announced and reported, Saltire completed the acquisition of Strong/MDI Screen Systems, Inc. ("MDI") on September 25, 2024 (the "MDI Acquisition"). The MDI Acquisition, together with the establishment of Saltire's investment platform, constituted Saltire's qualifying acquisition (the "Qualifying Acquisition"). As consideration for the MDI Acquisition, Saltire issued to Strong Global Entertainment Inc., MDI's parent company, 1,972,723 common shares ("Common Shares") valued at $10.00 per share, 900,000 Series A preferred shares (with an initial redemption value of $9 million), and approximately $0.8 million in cash (collectively, the "Acquisition Consideration"). Concurrent with the acquisition, Saltire completed a private placement offering of 433,559 Common Shares at $10.00 per share, raising gross proceeds of approximately $4.3 million (the "Private Placement").

In accordance with IFRS^® Accounting Standards, the Qualifying Acquisition was accounted for as a reverse takeover ("RTO"), whereby MDI is deemed the accounting acquirer and Saltire the accounting acquiree. As MDI was deemed to be the acquirer for accounting purposes, its assets, liabilities and operations since incorporation are included in the Financial Statements at their historical carrying values. Saltire's standalone results of operations have been included from the acquisition date of September 25, 2024.

About Saltire

Saltire is a long-term capital partner that allocates capital to equity, debt and/or hybrid securities of high-quality private companies. Investments made by Saltire consist of meaningful and influential stakes in carefully selected private companies that the management believes are under-valued businesses with high barriers to entry, predictable revenue streams and cash flows and defensive characteristics, with a view to significantly improve the fundamental value over the long-term. Although Saltire primarily allocates capital to private companies, Saltire may, in certain circumstances if the opportunity arises, also pursue opportunities with orphaned or value-challenged small and micro-cap public companies. Saltire provides investors with access to private and control-level investments typically reserved for larger players, while maintaining liquidity.

Forward Looking Information

Certain statements in this press release are prospective in nature and constitute forward-looking information and/or forward-looking statements within the meaning of applicable securities laws (collectively, "forward-looking statements"). Forward-looking statements include, but are not limited to, statements concerning Saltire's initiatives and the impact of same on shareholder value, as well as other statements with respect to management's beliefs, plans, estimates and intentions, and similar statements concerning anticipated future events, results, outlook, circumstances, performance or expectations that are not historical facts.

Forward-looking statements generally, but not always, can be identified by the use of forward-looking terminology such as "outlook", "objective", "may", "could", "would", "will", "expect", "intend", "estimate", "forecasts", "seek", "anticipate", "believes", "should", "plans" or "continue" or similar expressions suggesting future outcomes or events and the negative of any of these terms.

Forward-looking statements reflect management's current beliefs, expectations and assumptions and are based on information currently available to management. Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the future circumstances, outcomes or results anticipated or implied by such forward-looking statements will occur or that plans, intentions or expectations upon which the forward-looking statements are based will occur. By their nature, forward-looking statements involve known and unknown risks and uncertainties and other factors that could cause actual results to differ materially from those contemplated by such statements. Factors that could cause such differences include but are not limited to those risk factors set out in the Company's annual information form dated March 28, 2025, which is available on the Company's SEDAR+ profile at www.sedarplus.ca.

All forward-looking statements included in and incorporated into this press release are qualified by these cautionary statements. Unless otherwise indicated, the forward-looking statements contained herein are made as of the date of this press release, and except as required by applicable law, the Company does not undertake any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

SOURCE Saltire Capital Ltd.

FOR FURTHER INFORMATION PLEASE CONTACT: Andrew Clark, Director & Chief Executive Officer, Saltire Capital Ltd., [email protected], [phone]