Genius Group Announces 119% Revenue Growth for Full Year 2022, Expansion of Pro Forma Gross Margin to 53%

SINGAPORE, June 06, 2023 (GLOBE NEWSWIRE) -- Genius Group Limited (NYSE American: GNS) (“Genius Group” or the “Company”), a leading entrepreneur edtech and education group, today announced its financial results for the full year 2022.

Full Year 2022 Financial Highlights

  • Revenue growth of 119% to $18.2 million in 2022 from 2021 revenues of $ 8.3 million
  • Revenues on pro-forma basis of $28.1 million in 2022
  • Gross margin of 47% in 2022, compared to a gross margin of 33% in 2021
  • Pro forma gross margin of 53% in 2022
  • Net loss of ($55.3 million) in 2022 compared to net loss of ($4.5 million) in 2021 and pro forma net loss of ($54.9 million) in 2022, partially due to the Company’s annual valuation testing of its goodwill and intangible asset fair market values,
  • Adjusted EBITDA net loss of ($7.8 million) in 2022 compared to an adjusted EBITDA net loss of ($2.3 million) in 2021 and pro forma adjusted EBITDA net loss of ($7.3 million) in 2022
  • Cash and equivalent as of December 31, 2022, of $5.7 million compared to $1.8 million as of December 31, 2021
  • Total assets of $91.3 million as of December 31, 2022 compared to $17.6 million as of December 31, 2021
  • Intangible assets of $16.1 million as of December 31, 2022 compared to $1.4 million as of December 31, 2021 as a result of the acquisitions completed this year
  • Goodwill of $31.7 million as of December 31, 2022 compared to $1.3 million as of December 31, 2021 as a result of the acquisitions completed this year
  • $36.5 million in derivative liabilities as of December 31, 2022 due to $12.5 million in contingent consideration and $24.0 million in options

2022 Student and Partner Growth Highlights

The Company exceeded its growth targets for students and partners:

  • Students and users growth of 58%, from 2.8 million students at the end of 2021 to 4.5 million students and users at the end of 2022, representing an average daily growth of 4,452 new students and users per day
  • Paying students and users growth of 137%, from 72,422 students and users at the end of 2021 to 171,919 paying students and users at the end of 2022, representing an average daily growth of 272 new paying students and users per day
  • Partner growth of 29% from 11,414 at the end of 2021 to 14,760 at the end of 2022

Roger Hamilton, CEO of Genius Group, commented: “Genius Group has had a transformative year since its IPO in April 2022. We completed the acquisitions of 5 companies, grew at a significantly faster rate than the Edtech industry1, signed strategic partnerships and established an experienced leadership team to drive the growth of Genius Group and its subsidiaries. We plan to continue on this growth trajectory in 2023 as we attract new free and paying students, sign new partnerships, further integrate our past acquisitions and pursue our acquisition strategy.”

2022 Strategic and Operational Highlights

  • IPO of Genius Group on the NYSE American in April 2022
  • Appointment of experienced leadership team and Board members including Erez Simha, Rav Karwal, Tim Murphy and Richard Berman
  • Entered into a Securities Purchase Agreement for the sale of $18.1 million principal amount of Senior Secured Convertible Notes in a private placement with an institutional investor for a purchase price of $17 million
  • Completed the acquisitions of Education Angels, Property Investors Network Ltd, E-Square Education Enterprises (Pty) Ltd, the University of Antelope Valley Inc and Revealed Films Inc
  • Continued growth of GeniusU edtech platform with students in 200 countries
  • Expanded entrepreneur education offering from entrepreneurs and investors to a lifelong learning pathway from early age to 100 years old
  • Launched Entrepreneur Campus and Investor Campus, with Global Summits featuring New York Times Bestselling Authors and Social Media Thought Leaders.

Recent Strategic and Operational Highlights

  • Share repurchase and share consolidation resolutions approved during the Extraordinary General Meeting held in February 2023
  • Issued a $10 per share digital discount coupon to Genius Group shareholders in partnership with Upstream Exchange
  • Genius Group dual listing on Upstream in April 2023
  • Board and shareholder approval, pending NYSE approval for a $37 million spin-off of Entrepreneur Resorts Ltd (based on its current share price), scheduled for Q3 2023
  • Launch of 2023 Prospectus featuring personalized, lifelong learning pathway in entrepreneur education
  • Launch of California Business School at UAV and partnership with Swiss School of Business and Management, delivering MBA and DBA courses with access to Genius Group’s Global Entrepreneur Program, featuring New York Times Bestselling Authors in leadership, marketing, technology and entrepreneurship
  • Continued student and partner growth on GeniusU platform, with launch of AI-based Partner Portal and Genie AI, powered by GPT4
  • Increased management focus on larger strategic acquisitions as a key growth strategy

Financial Guidance

Genius Group maintains its 2023 financial guidance as we will accelerate the integration of our acquired companies and expect growing operating leverage driven by top line synergies from our EdTech platform and the digitization of our portfolio of products. We believe this will allow Genius Group to accelerate organic growth and provide a clear path to positive EBITDA in 2023. 

Webcast and Conference Call

Genius Group will host a live webcast to discuss the results Tuesday June 6 at 5:00 p.m. ET / 5:00 a.m. SGT. The webcast and supplemental information can be accessed on the investor relations section of the Genius Group website. An archive will be available after the conclusion of the live event and will remain available via the same link for 6 months.

Time: Tuesday, June 6, 2023, at 5:00 p.m. ET / 5:00 a.m. SGT

Webcast: Click on this link or go to the Investor Relations section of the Genius Group website to listen and view the slides. 

Dial-in: 877-407-0712 / +1 201-493-6716

About Genius Group

Genius Group is a leading entrepreneur Edtech and education group, with a mission to disrupt the current education model with a student-centered, life-long learning curriculum that prepares students with the leadership, entrepreneurial and life skills to succeed in today’s market. The group has a group user base of 4.5 million students and users in 200 countries, ranging from early age to 100.

For more information, please visit https://www.geniusgroup.net/.

Investor Notice

Investing in our securities involves a high degree of risk. Before making an investment decision, you should carefully consider the risks, uncertainties and forward-looking statements described in our most recent Annual Report on Form 20-F for the fiscal year ended December 31, 2022, filed with the SEC on June 6, 2023. If any of these risks were to occur, our business, financial condition or results of operations would likely suffer. In that event, the value of our securities could decline, and you could lose part or all of your investment. The risks and uncertainties we describe are not the only ones facing us. Additional risks not presently known to us or that we currently deem immaterial may also impair our business operations. In addition, our past financial performance may not be a reliable indicator of future performance, and historical trends should not be used to anticipate results in the future. See "Forward-Looking Statements" below. 

Forward-Looking Statements 

Statements made in this press release include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements can be identified by the use of words such as “may,” “will,” “plan,” “should,” “expect,” “anticipate,” “estimate,” “continue,” or comparable terminology. Such forward-looking statements are inherently subject to certain risks, trends and uncertainties, many of which the Company cannot predict with accuracy and some of which the Company might not even anticipate and involve factors that may cause actual results to differ materially from those projected or suggested. Readers are cautioned not to place undue reliance on these forward-looking statements and are advised to consider the factors listed above together with the additional factors under the heading “Risk Factors” in the Company's Annual Reports on Form 20-F, as may be supplemented or amended by the Company's Reports of a Foreign Private Issuer on Form 6-K. The Company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events, new information or otherwise. 

GENIUS GROUP LIMITED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

(Expressed in US Dollars)

        For the year ended December 31,  
    Note   2022     2021  
ASSETS                    
Current Assets                    
Cash and cash equivalents       $ 5,720,569     $ 1,784,938  
Restricted cash   2     11,108,816        
Accounts receivable, net   2     4,856,637       1,018,003  
Other Receivables   5     120,304       66,000  
Due from related parties   6     351,357       44,245  
Inventories   7     1,001,977       92,530  
Prepaid expenses and other current assets   8     1,090,787       3,490,446  
Total Current Assets         24,250,447       6,496,162  
Property and equipment, net   9     563,131       6,776,116  
Operating lease right-of-use asset   10     12,573,710       1,077,241  
Investments at fair value   11     29,071       29,069  
Goodwill   12     31,688,887       1,320,100  
Intangible assets, net   13     16,107,293       1,394,969  
Other receivables   5     732,716        
Due from related parties   6     5,288,264        
Other non-current assets   15     26,108       501,750  
Total Assets       $ 91,259,627     $ 17,595,407  
                     
LIABILITIES AND STOCKHOLDERS’ EQUITY                    
Current Liabilities                    
Accounts payable       $ 1,672,306     $ 1,078,381  
Accrued expenses and other current liabilities   16     3,809,540       2,064,302  
Deferred revenue   17     6,391,993       2,561,912  
Income tax payable   2     355,023        
Due to related parties   19     2,932,090       425,551  
Operating lease liabilities - current portion   10     1,590,538       436,271  
Loans payable - current portion   18     334,391       65,415  
Convertible debt obligations - current portion   20     5,752,328       507,765  
Short term debt   20     539,245        
Total Current Liabilities         23,377,454       7,139,597  
Due to related parties   19     1,729        
Operating lease liabilities – non-current portion   10     11,394,337       894,589  
Loans payable – non-current portion   18     428,025       85,858  
Convertible debt obligations - non-current portion   20     2,223,523       766,245  
Deferred tax liability   14     3,391,129       723,122  
Derivative liabilities   21     36,488,594        
Total Liabilities         77,304,791     $ 9,609,411  
Stockholders’ Equity                    
Contributed capital   22     110,534,000       50,924,276  
Subscriptions receivable   22     (1,900,857 )     (1,900,857 )
Reserves         (32,933,714 )     (31,888,638 )
Accumulated deficit         (68,539,210 )     (13,493,684 )
Capital and reserves attributable to owners of Genius Group Ltd         7,160,219       3,641,097  
Non-controlling interest         6,794,617       4,344,899  
Total Stockholders’ Equity         13,954,836       7,985,996  
Total Liabilities and Stockholders’ Equity       $ 91,259,627     $ 17,595,407  

The accompanying notes are an integral part of these consolidated financial statements and are disclosed in the 20F filing.


GENIUS GROUP LIMITED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Expressed in US Dollars)

        For the year ended December 31,  
    Note   2022     2021
As restated (1)
 
Revenue   23   $ 18,193,616     $ 8,294,804  
Cost of revenue   2     (9,554,327 )     (5,537,346 )
Gross profit         8,639,289       2,757,458  
                     
Operating (Expenses) Income                    
General and administrative   25     (21,073,794 )     (7,211,204 )
Depreciation and amortization   9     (1,182,413 )     (38,864 )
Other operating income   24     144,396       490,300  
Impairment loss   9,12,13     (28,246,010 )      
(Loss) gains from foreign currency transactions   2     135,625       (166,174 )
Total operating expenses         (50,222,196 )     (6,925,942 )
Loss from Operations         (41,582,907 )     (4,168,484 )
Other Expense                    
Other Income   24     418,437        
Revaluation adjustment of contingent liabilities   21     (13,838,197 )      
Interest expense, net   26     (1,312,476 )     (449,566 )
Total Other Expense         (14,732,236 )     (449,566 )
Loss Before Income Tax         (56,315,143 )     (4,618,050 )
Income Tax Benefit   27     1,063,596       128,852  
Net Loss         (55,251,547 )     (4,489,198 )
Other comprehensive income:                    
Foreign currency translation   2     (1,045,076 )     230,081  
Total Comprehensive Loss       $ (56,296,623 )   $ (4,259,117 )
                     
Net Loss is attributed to:   28                
Owners of Genius Group Ltd         (55,045,526 )     (4,315,239 )
Non-controlling interest         (206,021 )     (173,959 )
Net Loss         (55,251,547 )     (4,489,198 )
                     
Total Comprehensive Loss is attributable to:                    
Owners of Genius Group Ltd         (56,090,602 )     (4,085,158 )
Non-controlling interest         (206,021 )     (173,959 )
Total Comprehensive Loss       $ (56,296,623 )   $ (4,259,117 )
                     
Net loss per share attributed to common stockholders, basic and diluted       $ (2.44 )   $ (0.28 )
Weighted-average number of shares outstanding, basic, and diluted         22,634,366       16,155,812  
Number of shares outstanding, basic, and diluted         27,705,227       16,155,812  

1) Restatement details in 20F filing.

The accompanying notes are an integral part of these consolidated financial statements and are disclosed in the 20F filing.


GENIUS GROUP LIMITED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS

(Expressed in US Dollars)

    For the year Ended December 31,  
    2022     2021  
CASH FLOWS FROM OPERATING ACTIVITIES:                
Net Loss   $ (55,251,547 )   $ (4,489,198 )
Adjustments to reconcile net loss to net cash used in operating activities:                
Stock-based compensation     1,308,784       293,837  
Depreciation and amortization     2,350,640       1,574,913  
Amortization of tax liability     (1,284,166     105,650  
(Gain) loss on foreign exchange transactions     (135,625 )     166,174  
Provision for doubtful accounts     (1,509,486 )     (39,108 )
Impairment loss     28,246,010        
Revaluation adjustment on contingent liabilities     13,838,197        
Amortization of debt discount           140,837  
Interest expense on lease liabilities     491,336       131,291  
Changes in operating assets and liabilities                
Accounts receivable     1,161,349       (30,554 )
Other receivable     (19,138 )     (66,000 )
Prepaid expenses and other current assets     1,489,459       (1,927,176 )
Inventory     (545,449 )     20,013  
Accounts payable     (107,372 )     256,562  
Accrued expenses and other current liabilities     751,442       254,080  
Deferred revenue     996,324       1,015,200  
Deferred tax liability     220,570       (257,953 )
Income tax payable     (237,759 )      
Other non-current liabilities           (217,291 )
Total Adjustments     47,015,116       1,420,475  
Net cash used in operations     (8,236,431 )     (3,068,723 )
CASH FLOWS FROM INVESTING ACTIVITIES:                
Internally developed software     (743,995 )     (804,314 )
Acquisitions     (8,843,458 )      
Purchase of equipment     (222,680 )     (77,797 )
Acquisition of intangible     (279,356 )      
Net cash used in investing activities:     (10,089,489 )     (882,111 )
CASH FLOWS FROM FINANCING ACTIVITIES:                
Amount due to/from related party, net     (221,842 )     (154,345 )
Proceeds from derivative liability, net     (250,000 )      
Advance received for share issuances             953,087  
Proceeds from IPO, net     17,308,453        
Proceeds from convertible debt, net of issuance costs     4,184,964        
Proceeds from equity issuances     2,701,215       3,127,442  
Issuance from convertible debt     (509,311 )      
Lease liabilities     (957,430 )     (758,522 )
Proceeds from Loan     972,593        
Repayment of Loan     (1,285,181 )     (71,967 )
Net cash provided by financing activities     21,943,461       3,095,695  
Increase (decrease) in cash and cash equivalents during the year     3,617,541       (855,139 )
Foreign exchange impact on cash     318,090       366,926  
Cash and cash equivalents, beginning of year     1,784,938       2,273,151  
CASH AND CASH EQUIVALENTS, END OF THE YEAR   $ 5,720,569     $ 1,784,938  
Supplemental Disclosures of Cash Flow Information:                
Cash paid during the period for interest   $ 847,520     $ 202,176  
Non-Cash Investing and Financing Activities                
Fair value of shares issued in satisfaction of a liability   $ 350,000     $  
Fair value of shares issued for the acquisition of entities   $ 35,098,001     $  
Fair value of shares issued for conversion of convertible notes   $ 7,829,607     $ 293,837  

The accompanying notes are an integral part of these consolidated financial statements and are disclosed in the 20F filing.

Pro Forma Financials

The following tables set forth summary combined pro forma financial data and audited summary consolidated financial data for the periods and as of the dates indicated. The summary combined unaudited pro forma financial data below includes the consolidated financials of all companies in the Genius Group, including the Pre-IPO Group and the Acquisitions as if they were operating as one group in the periods indicated. The pro forma financials for 2022 include the audited financial data of the Pre-IPO Group and Acquisitions from the audited financials and the unaudited financial data of the Acquisitions.

The summary income data for the years ended December 31, 2022 and 2021 and the summary balance sheet data as of December 31, 2022 and 2021 for the Group are derived from the audited consolidated financial statements included in this Annual Report. Our audited consolidated financial statements have been prepared in U.S. dollars and in accordance with IFRS, as issued by the IASB.

Genius Group is made up of nine companies (taking into account the Acquisitions) that have varying financial performance. For this reason, you should read the summary combined pro forma financial data in conjunction with our audited consolidated financial statements and related notes beginning on page F-1 of this Annual Report, and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included elsewhere in this Annual Report. Our historical results do not necessarily indicate our expected results for any future periods.

    Genius Group     Group  
    Pro forma     Audited Financials  
    Year Ended     Year Ended  
    December 31,     December 31,  
    2022     2022     2021  
    (USD 000’s)     (USD 000’s)     (USD 000’s)  
Sales     28,129       18,194       8,295  
Cost of goods sold     (13,328 )     (9,555 )     (5,537 )
Gross profit     14,801       8,639       2,757  
Other Operating Income     280       280       324  
Operating Expenses     (57,013 )     (50,502 )     (7,250 )
Operating Loss     (41,932 )     (41,583 )     (4,168 )
Other income     1,172       419       0  
Other Expense     (15,207 )     (15,151 )     (450 )
Net Loss Before Tax     (55,967 )     (56,315 )     (4,618 )
Tax Benefits     1,064       1,064       129  
Net Loss After Tax     (54,903 )     (55,252 )     (4,489 )
Other Comprehensive Loss     (1,045 )     (1,045 )     230  
Total Loss     (55,948 )     (56,297 )     (4,259 )
Net income per share, basic and diluted     (2.43 )     (2.44 )     (0.28 )
Weighted-average number of shares outstanding, basic and diluted     22,634,366       22,634,366       16,155,812  


    Genius Group     Group  
    Pro forma     Audited Financials  
    Year Ended     Year Ended  
    December 31,     December 31,  
    2022     2022     2021  
    (USD 000’s)     (USD 000’s)     (USD 000’s)  
Summary Balance Sheet Data:                        
Total current assets     24,251       24,251       6,496  
Total non-current assets     67,009       67,009       11,099  
Total Assets     91,260       91,260       17,595  
Total current liabilities     23,378       23,378       7,140  
Total non-current liabilities     53,927       53,927       2,469  
Total Liabilities     77,305       77,305       9,609  
Total Stockholders’ Equity     13,955       13,955       7,986  
Total Liabilities and Shareholders’ Equity     91,260       91,260       17,595  


Non-IFRS Financial Measure

We have included Adjusted EBITDA in this Annual Report because it is a key measure used by our management and board of directors to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget and to develop short- and long-term operational plans. In particular, the exclusion of certain expenses in calculating Adjusted EBITDA can provide a useful measure for period-to-period comparisons of our core business. Non-IFRS financial measures are not a substitute for IFRS financial measures.

We calculate Adjusted EBITDA as Net loss for the period plus income taxes plus/ minus net finance result plus depreciation and amortization plus/minus share-based compensation expenses plus bad debt provision. Share-based compensation expenses and bad debt provision are included in General and administrative expenses in the Consolidated Statements of Operations.

    Genius Group     Group  
    Pro forma     Audited Financials  
    Year Ended     Year Ended  
    December 31,     December 31,  
    2022     2022     2021  
    (USD 000’s)     (USD 000’s)     (USD 000’s)  
Net Loss     (54,903 )     (55,252 )     (4,489 )
Tax Benefits     (1,064 )     (1,064 )     (129 )
Interest Expense, net     1,325       1,312       450  
Depreciation and Amortization     2,453       2,351       1,575  
Impairment     28,246       28,246        
Revaluation Adjustment of Contingent Liabilities     13,838       13,838       —   
Stock Based Compensation     1,309       1,309       294  
Bad Debt Provision     1,529       1,509       (39 )
Adjusted EBITDA     (7,267 )     (7,750 )     (2,338 )


Key Business Metrics

We monitor the key business metrics and Non-IFRS financial measures to help us evaluate our business and growth trends, set growth targets and budgets, and measure the effectiveness of our sales and marketing efforts. These key business metrics and Non-IFRS financial measures are presented for supplemental informational purposes only, are not a substitute for IFRS financial measures, and may differ from similarly titled metrics or measures presented by other companies. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Key Business Metrics and Non-IFRS Financial Measures” for detailed descriptions of the measures and metrics.

Education segment – Genius Group (including Acquisitions)

    Key Business Metrics –
Education Segment
Pro Forma Year Ended December 31,
 
    2022     2021  
Number of students and users     4,450,852       2,825,628  
Number of Free Students and users     4,278,933       2,768,530  
Number of Paying Students and users     171,919       72,422  
Number of Partners     14,760       11,414  
Number of countries of operation     191       191  
Marketing Spend     1,994,331       1,139,928  
Education Revenue     23,469,609       25,468,253  
Revenue from New Paying Students     10,164,848       7,377,236  
New Students     1,640,698       890,328  
New Paying Students     19,681       10,425  
Conversion rate     1.20 %     1.17 %
Average Acquisition Cost per New Paying Student     101       109  
Average Annual Revenue per New Paying Student     516       707  
Net Income (Loss) margin     (172.07 )%     (4.56 )%
Adjusted EBITDA margin     (11.76 )%     4.10 %

Campus segment – Entrepreneur Resorts

    Key Business Metrics –
Campus Segment
Pro Forma Year Ended December 31,
 
    2022     2021  
Revenue     4,638,122       3,100,750  
No of Locations     6       6  
No of Seats/Rooms     367       367  
Utilization     33 %     28 %
Total Orders     136,204       96,390  
Revenue Per Order     34       32  


Contacts

Investors:
Flora Hewitt, Vice President of Investor Relations and Mergers and Acquisitions
Email: investor@geniusgroup.net

Media Contacts: Adia PR
Email: gns@adiapr.co.uk

US Investors: 
Dave Gentry
RedChip Companies Inc
1-800-RED-CHIP
GNS@redchip.com

1 Holon IQ Edtech growth estimated of 16.3% CAGR from 2019 to 2025


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Source: Genius Group Limited