Critical Services leads margin expansion with 144% increase in Gross Margin

• Total revenue of $12.6 million vs. $12.3 million in Q2 2023, with 98% Critical Services growth to $1.45 million in Q2 2024 from $0.73 million in Q2 2023.

• Gross Margin $2.0 million (15.6% of sales in Q2 2024) vs. $1.4 million (11.2%) in Q2 2023, driven by increased Critical Services mix and margin improvements across the Company.

• Adjusted EBITDA improved to a loss of $591,888 in Q2 2024 from a loss of $1,870,054 in Q2 2023 from stronger margins and cost management versus the prior year.

Vancouver, British Columbia--(Newsfile Corp. - August 30, 2024) - Plurilock Security Inc. (TSXV: PLUR) (OTCQB: PLCKF) ("Plurilock" or the "Company"), a global cybersecurity services and solutions provider, announces its financial results for the three (Q2 2024) and six-months ended June 30, 2024. All dollar figures are stated in Canadian dollars, unless otherwise indicated.

Q2 2024 Financial Highlights

• Total revenue for the three and six months ended June 30, 2024, was $12,642,026 and $24,216,956 respectively as compared to $12,251,143 and $28,018,471 for the three and six months ended June 30, 2023, respectively. Revenue for the three and six months ended June 30, 2024, and 2023, included revenue from both the Technology Division and the Solutions Division. Revenue for the six months ended June 30, 2024, is lower than the comparative period as a result of the timing on a few large orders and lower volume from the Integra acquisition ("INC") offset partially by growth in professional services sales.

• Hardware and systems sales revenue for the three and six months ended June 30, 2024, totalled $10,113,915 and $19,029,167, respectively compared to $10,368,483 and $22,812,612, respectively in the prior year for the same periods. Software, license, and maintenance sales revenue for the three and six months ended June 30, 2024, was $1,078,736 and $2,726,489, respectively, compared to $1,150,767 and $3,864,345, respectively, for the same periods in the prior year. Professional services revenue was $1,449,375 and $2,461,300 for the three and six months ended June 30, 2024, respectively, compared to $731,893 and $1,341,514, respectively, for the same periods in the prior year.

• Hardware and systems sales revenues for the three and six months ended June 30, 2024, accounted for 80.0% and 78.6%, respectively, of total revenues compared to 84.6% and 81.4%, respectively, for the three and six months ended June 30, 2023. Software, license and maintenance sales revenues for the three and six months ended June 30, 2024, accounted for 8.5% and 11.3%, respectively, compared to 9.4% and 13.8%, respectively, for the three and six months ended June 30, 2023. Professional services revenue for the three and six months ended June 30, 2024, accounted for 11.5% and 10.2%, respectively, of total revenues, compared to 6.0% and 4.8%, respectively, for the three and six months ended June 30, 2023.

• Gross margin for the three and six months ended June 30, 2024, was 15.6% and 18.6%, respectively, compared to 11.2% and 12.5%, respectively, for the three and six months ended June 30, 2023.

• Adjusted EBITDA for the three and six months ended June 30, 2024, was $(591,888) and $(963,018) , respectively, compared to $(1,870,054) and $(2,842,020), respectively, in the prior year for the same periods.

• Cash and cash equivalents and restricted cash on June 30, 2024, was $2,909,782 compared to $2,058,193 on December 31, 2023.

• During the three and six months ended June 30, 2024, the Company used $1,450,460 and $2,057,639 of cash from operating activities, respectively, compared to $870,734 used and $829,226 generated from operating activities in the prior year during the same periods.

"In the second quarter of 2024, Plurilock continued to expand its Service offerings, a key strategic focus of our growth and margin expansion strategies," said Ian L. Paterson, CEO of Plurilock. "Throughout the quarter and post June 30, 2024, we continued to add new clients and expand our presence within existing clients. Our pipeline of opportunities remains strong; our high-margin Critical Services is scaling nicely; and our business transformation remains on schedule. We will continue to prioritize its high-end cyber consulting business to generate higher gross margins and accelerate our path to profitability."

Q2 2024 Operational Highlights

• April 1, 2024: New Executive Chair and Company begins business transformation plan

• April 29, 2024: Close $5.5 million private placement financings

• May 2, 2024: $900,000 sale to Canadian federal government agency

• May 23, 2024: Amendment to Convertible Debenture terms and warrant inducement program and closing of debt settlement

• June 19, 2024: US$6.16 Million total contract value with U.S. Treasury

• June 21, 2024: Scale critical services sales and support staff

• June 26, 2024: US$814,000 three-year contract with existing customer to deliver cloud security to major laboratory data and advisory firm

Subsequent to Q2 2024 Operational Highlights

• July 9, 2024: Plurilock Critical Services expands existing engagement with S&P 500, NASDAQ 100 semiconductor company

• July 15, 2024: Appoint former White House lawyer/senior CIA officer to Industry Advisory Council

• July 16, 2024: Appoint former CrowdStrike board member / AppDynamics President to Industry Advisors Council

• July 25, 2024: Named 2024 Quadrant Champion by Info-Tech for fifth year

• July 30, 2024: Appoints 35-year veteran of enterprise technology IT and solutions sales to Industry Advisory Council

• August 14, 2024: File nonprovisional patent application for AI-driven cloud access security broker technology for generative AI

• August 19, 2024: Appoint Ron Wilson, President of Best Buy Canada, to Industry Advisory Council

• August 20, 2024: New sales to the United States Department of Transportation

• August 26, 2024: Engages Clear Street review U.S. strategic options

• August 28, 2024: Announces Gross Proceeds of Over $2 Million from Warrant Exercises

Outlook for 2024

The Company continues to see strong growth in the cybersecurity market, with organizations investing heavily to protect their assets. With the expedited pace of digital transformation, cyber threats are on the rise, and businesses need to rethink their approach to cybersecurity to mitigate risks. This rethinking involves integrating security into digital transformation initiatives and embedding cybersecurity into business processes. It also involves re-evaluating the role of cybersecurity within the organizational structure. However, such transformation demands time, resources, and strategic planning. As such, Plurilock is receiving increased demand from customers seeking help with critical services, which is expected to drive further growth in this area, leading to higher gross margins. The Company is also exploring M&A opportunities and will consider strategic, accretive deals over the next 12 to 24 months.

Summary of Key Financial Metrics

Note:

(1) Non-GAAP measure. Earnings before interest, taxes, depreciation, and amortization ("EBITDA") and Adjusted EBITDA should not be construed as alternatives to net income/loss determined in accordance with IFRS. EBITDA and Adjusted EBITDA do not have any standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other issuers. The Company defines EBITDA as earnings before interest, taxes, and amortization. Adjusted EBITDA is defined as EBITDA before stock-based compensation, financing, acquisition related expenses, loss on disposal on assets, impairment on assets and change in fair value of convertible debt. The Company believes that EBITDA and Adjusted EBITDA is a meaningful financial metric for investors as it adjusts income to reflect amounts which the Company can use to fund working capital requirements, service future interest and principal debt repayments and fund future growth initiatives.

Non-IFRS measures

This news release presents information about EBITDA and Adjusted EBITDA, both of which are non-IFRS financial measures, to provide supplementary information about operating performance. Plurilock defines EBITDA as net income or loss before interest, income taxes, depreciation, and amortization. Adjusted EBITDA removes non-cash share-based compensation, financing, and acquisition-related expenses from EBITDA. The Company believes that EBITDA and Adjusted EBITDA is a meaningful financial metric for investors as it adjusts income to reflect amounts which the Company can use to fund working capital requirements, service future interest and principal debt repayments and fund future growth initiatives. EBITDA and Adjusted EBITDA are not intended as a substitute for IFRS measures. A limitation of utilizing these non-IFRS measures is that the IFRS accounting effects of the adjustments do in fact reflect the underlying financial results of Plurilock's business and these effects should not be ignored in evaluating and analyzing Plurilock's financial results. Therefore, management believes that Plurilock's IFRS measures of net loss and the same respective non-IFRS measure should be considered together. Non-IFRS measures do not have any standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Readers should refer to the Company's most recently filed MD&A for a more detailed discussion of these measures and their calculations.

Quarterly Filings

Management's Discussion and Analysis and Interim Condensed Consolidated Financial Statements and the notes thereto for the fiscal period ended June 30, 2024 can be obtained from Plurilock's corporate website at and under Plurilock's SEDAR+ profile at .

About Plurilock

Plurilock sells cybersecurity solutions to the United States and Canadian Federal Governments along with Global 2000 companies. Through these relationships, Plurilock sells its unique brand of Critical Services-aiding clients with our expertise to defend against, detect, and prevent costly data breaches and cyberattacks.

Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the TSX Venture Exchange policies) accepts responsibility for the adequacy or accuracy of this release.

Forward-Looking Statements

This press release may contain certain forward-looking statements and forward-looking information (collectively, "forward-looking statements") related to future events or Plurilock's future business, operations, and financial performance and condition. Forward-looking statements normally contain words like "will", "intend", "anticipate", "could", "should", "may", "might", "expect", "estimate", "forecast", "plan", "potential", "project", "assume", "contemplate", "believe", "shall", "scheduled", and similar terms. Forward-looking statements are not guarantees of future performance, actions, or developments and are based on expectations, assumptions, and other factors that management currently believes are relevant, reasonable, and appropriate in the circumstances. Although management believes that the forward-looking statements herein are reasonable, actual results could be substantially different due to the risks and uncertainties associated with and inherent to Plurilock's business. Additional material risks and uncertainties applicable to the forward-looking statements herein include, without limitation, the impact of general economic conditions, and unforeseen events and developments. This list is not exhaustive of the factors that may affect the Company's forward-looking statements. Many of these factors are beyond the control of Plurilock. All forward-looking statements included in this press release are expressly qualified in their entirety by these cautionary statements. The forward-looking statements contained in this press release are made as at the date hereof, and Plurilock undertakes no obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required by applicable securities laws. Risks and uncertainties about the Company's business are more fully discussed under the heading "Risk Factors" in its most recent Annual Information Form. They are otherwise disclosed in its filings with securities regulatory authorities available on SEDAR+ at .