0001213900-23-065032.txt : 20230809 0001213900-23-065032.hdr.sgml : 20230809 20230809161759 ACCESSION NUMBER: 0001213900-23-065032 CONFORMED SUBMISSION TYPE: 6-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20230809 FILED AS OF DATE: 20230809 DATE AS OF CHANGE: 20230809 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Gorilla Technology Group Inc. CENTRAL INDEX KEY: 0001903145 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 000000000 STATE OF INCORPORATION: E9 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 6-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-41448 FILM NUMBER: 231155434 BUSINESS ADDRESS: STREET 1: GRAND PAVILION, HIBISCUS WAY STREET 2: 802 WEST BAY ROAD CITY: GRAND CAYMAN STATE: E9 ZIP: KY1-1205 BUSINESS PHONE: 886-2-2627-7996 MAIL ADDRESS: STREET 1: GRAND PAVILION, HIBISCUS WAY STREET 2: 802 WEST BAY ROAD CITY: GRAND CAYMAN STATE: E9 ZIP: KY1-1205 6-K 1 ea183156-6k_gorillatech.htm REPORT OF FOREIGN PRIVATE ISSUER

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION 

Washington, D.C. 20549 

 

FORM 6-K

  

REPORT OF FOREIGN PRIVATE ISSUER 

PURSUANT TO RULE 13a-16 OR 15d-16 

UNDER THE SECURITIES EXCHANGE ACT OF 1934 

 

For the month of August 2023 

 

Commission File Number: 001-41448 

 

Gorilla Technology Group Inc.

(Translation of registrant’s name into English)

 

Meridien House

42 Upper Berkeley Street

Marble Arch

London, United Kingdom W1H 5QJ

(Address of principal executive offices)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

 

Form 20-F       Form 40-F

 

 

 

 

 

 

Explanatory Note

 

On August 9, 2023, Gorilla Technology Group Inc., a Cayman Islands exempted company (the “Company”), issued a press release announcing first half 2023 earnings and providing certain guidance for the remainder of fiscal year 2023. The press release is furnished as Exhibit 99.1 to this report on Form 6-K.

 

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SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this amended report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

  Gorilla Technology Group Inc.
     
Date: August 9, 2023 By: /s/ Jayesh Chandan
  Name:  Jayesh Chandan
  Title:

Chief Executive Officer

(Principal Executive Officer)

 

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Exhibit Index

 

Exhibit   Description
99.1   Press release dated August 9, 2023

 

 

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EX-99.1 2 ea183156ex99-1_gorillatech.htm PRESS RELEASE DATED AUGUST 9, 2023

Exhibit 99.1

 

Gorilla Technology Group Reports First Half 2023 Financial Results

 

– Year-on-year growth in fiscal 2023 will be nearly 300% in constant currency –

 

– Booked sales exceeded internal target of $41 million, standing at $272 million (a 563% increase) –

 

– Revenue guidance of $65 million for 2023 and $90 million for 2024 –

 

– Improved Visibility with Revenue Contracted Through 2026 –

 

– 49.4% Gross Margin Affirms Success in Improving Quality of Customer Base –

 

LONDON, August 9, 2023 -- Gorilla Technology Group Inc. (“Gorilla” or the “Company”) (NASDAQ: GRRR), a global provider of AI-based edge video analytics, IoT technologies, and cybersecurity, today reported its unaudited financial results for the six months ended June 30, 2023.

 

Highlights

 

Booked sales exceeded internal target of $41 million, standing at $272 million, a 563% increase
Evolved from a Project centric business to a Product & Services Business, as demonstrated by multi-hundred-million-dollar contract for Government of Egypt
Implemented financial and operational discipline by transitioning out of marginal or unprofitable projects
Will implement Smart Government Security Convergence solution for the Government of Egypt
Largest contract in company history, with total revenues of $270 million over three years
Aggressive actions to safeguard shareholders from illegal stock manipulation
Recorded gross margin of 49.4%, a significant increase from the previous year’s margin of 33.1%, standing as compelling evidence of a successful transformation to position the company for sustainable and profitable growth at scale
  Operating expense decreased by $1.9 million compared with the prior year

2023 and 2024 revenue guidance at $65 million and $90 million, respectively

 

Gorilla Chief Executive Officer Jay Chandan commented, “Just after quarter-end we announced a transformational contract with the Government of Egypt, in which we will implement a Smart Government Security Convergence solution. This contract affirms our standing as a reliable global solutions provider, which is important because MENA-region governments are actively seeking innovative partners to support their transformation from conventional systems to digital technologies. Egypt is a notable milestone in our globalization strategy and puts us on a path to profitability by the end of 2024. This contract and other wins give us outstanding visibility in revenue and profitability for the next three years. The contract is worth more than $270 million over three years and represents the largest customer win in Gorilla’s history. Together with other recent wins in Taiwan and UK, we have now secured $300 million worth of projects. We have successfully transformed from being a Project Centric business to a Product & Services Solutions business and have greatly expanded on our Platform as a Service. Our service offerings now include Smart City, Network, Video, Cybersecurity and IoT across select verticals including Government & Public Services, Manufacturing, Telecom, Retail, Transportation & Logistics, Healthcare and Education. We have made significant progress within the last 10 months and this, I believe, will be a turning point in Gorilla’s history.”

 

 

 

 

Chandan continued, “Yesterday, we issued a statement addressing the illegal and unethical manipulation of our stock dating back to late 2022. We do not make this accusation lightly and have gathered persuasive evidence that supports our view. We hired an economic analysis firm with expertise in suspicious trading activity, and after detailed work they uncovered compelling evidence suggesting manipulation of our share price. Meanwhile, we uncovered evidence of illegal attempts to extort below-market sales of our shares and colluding efforts to deceive shareholders and take activist actions. We have many tools to pursue the perpetrators, including legal action and warning our honest shareholders. We will fight to make Gorilla a thriving success, and we will stop at nothing to end the unjustified attacks being perpetrated upon us.”

 

Commenting on results, Gorilla Chief Financial Officer Daphne Huang noted, “We are on track to achieve revenues of approximately $65 million for the full year, driven by progress in our performance and strong demand. We are aiming to be cashflow positive by the end of 2024. We have also instilled sound operating and financial discipline into our business via the massive transformation we started last autumn. We see evidence of success in the decision to avoid unfocused and unprofitable business. Solid growth in security convergence demonstrates the wisdom of our product portfolio and the Egypt project win shows that this segment can drive explosive growth in the years ahead. Despite an uncertain macroeconomic environment today, we see vast opportunities ahead of us and are confident in our capacity to continue improving our performance through 2023 and 2024. You can also see the better quality of customers and projects in our gross margin, which expanded to nearly 50%. Based on the current Egypt project plan and revenue recognition practices, as well as other projects, we anticipate second half 2023 revenue of approximately $58 million.”

 

First Half 2023 Results

 

Unless noted otherwise, all figures are for the six months ended June 30, 2023, and all comparisons are with the corresponding period of 2022.

 

The following table summarizes financial results:

 

   Six months ended 
   June 30 
Items  2023   2022 
   (Unaudited) 
Revenue  $6,429,335   $13,800,930 
Cost of revenue   (3,250,584)   (9,226,561)
Gross Profit   3,178,751    4,574,369 
Gross Margin   49.4%   33.1%
Operating expense   (10,470,307)   (12,402,188)
Operating loss   (7,291,556)   (7,827,819)
Net loss  $(7,269,758)  $(8,636,040)

 

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The following table shows our EBIT, EBITDA, and adjusted EBITDA, together reconciled to the loss for the six months period ended June 30, 2023, and 2022.

 

(Unaudited)  Six months
ended
June 30,
2023
   Six months
ended
June 30,
2022
 
Loss for the period  $(7,269,758)  $(8,636,040)
Income tax expense   2,172    356,130 
Interest and Finance costs   (23,970)   452,091 
EBIT  $(7,291,556)   (7,827,819)
Depreciation expense   321,902    3,420,393 
Amortization expense   406,573    1,030,193 
EBITDA  $(6,563,081)  $(3,377,233)
Transaction costs (one time)(1)   3,097,764    2,151,856 
Adjusted EBITDA   (3,465,317)   (1,225,377)

 

(1)Transaction costs are one-off expenses for one-time employee expenses and professional services related to asset acquisition, professional services for one-time project which are considered as one-off corporate development events and added back for calculation of adjusted EBITDA.

 

Despite the lower revenue base, gross margin increased from 33.1% to 49.4%. Operating expense decreased by $1.9 million compared to the same period in 2022. Adjusted EBITDA was negative $3.5 million compared to negative $1.2 million a year ago.

 

Outlook

 

The Company updated guidance to reflect the Egypt contract. Based on the current project plan and revenue recognition practices, Gorilla reaffirms 2023 full year revenue guidance of $65 million, as such anticipates second half 2023 revenue of approximately $58 million. With won business to date of $300 million, the Company is comfortable offering initial guidance for 2024 revenue of $90 million.

 

About Gorilla Technology Group Inc.

 

“Empowering Your Tomorrow”

 

Gorilla, headquartered in London U.K., is a global solution provider in Security Intelligence, Network Intelligence, Business Intelligence and IoT technology. Gorilla provides a wide range of solutions, including, Smart City, Network, Video, Cybersecurity and IoT across select verticals of Government & Public Services, Manufacturing, Telecom, Retail, Transportation & Logistics, Healthcare and Education.

 

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The Company’s vision is to empower a connected tomorrow through innovative and transformative technologies. Gorilla envisions a world where seamless connectivity transcends boundaries, enriching lives, industries, and societies.

 

Gorilla’s commitment is to lead the way in pioneering cutting-edge solutions that bridge gaps, foster collaboration and inspire progress. By relentlessly pushing the boundaries of technology, the Company aims to create an ecosystem where individuals, businesses and communities thrive in an era of digital empowerment.

 

Through continuous innovation, ethical practices and a steadfast dedication to quality, Gorilla strives to shape a future where every interaction, transaction, and experience is enhanced by the power of technology.

 

For more information go to Gorilla-Technology.com.

 

Forward-Looking Statements

 

This press release contains “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Gorilla’s actual results may differ from its expectations, estimates and projections and consequently, you should not rely on these forward-looking statements as predictions of future events. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believes,” “predicts,” “potential,” “might” and “continues,” and similar expressions are intended to identify such forward-looking statements. These forward-looking statements include, without limitation, statements regarding our beliefs about future revenues, our ability to attract the attention of customers and investors alike, our ability to fund operations as we execute a strategic shift to pursue the larger and higher margin opportunities in Security Convergence, our expectations to swing to profit in the quarters ahead, our immediate priorities, Gorilla’s strategic shift to enable it to pursue larger projects with better revenue visibility, Gorilla’s contract with the Government of Egypt, Gorilla’s ability to win additional projects and execute definitive contracts related thereto, along with those other risks described under the heading “Risk Factors” in the Form 20-F Gorilla filed with the Securities and Exchange Commission (the “SEC”) on April 28, 2023, and those that are included in any of Gorilla’s future filings with the SEC. These forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from expected results. Most of these factors are outside of the control of Gorilla and are difficult to predict. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated or anticipated by such forward-looking statements. Readers are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made. Gorilla undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date they were made except as required by law or applicable regulation.

 

Non-IFRS Measures

 

Certain of the measures included in this press release are non-IFRS financial measures, including adjusted EBITDA. Non-IFRS financial measures should not be considered in isolation from, or as a substitute for, financial information presented in compliance with IFRS, and non-IFRS financial measures as used by Gorilla are not reported by all their competitors and may not be comparable to similarly titled amounts used by other companies.

 

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We believe that the non-IFRS measures such as adjusted EBITDA provide useful information about our core operating results, enhance the overall understanding of our past performance and prospects and allow for greater visibility with respect to key metrics used by our management in its financial and operational decision-making. We present adjusted EBITDA to provide more information and greater transparency to investors about our operating results.

 

Adjusted EBITDA represents EBITDA excluding transaction costs and share listing expenses which are one-off expenses for professional services related to our Business Combination, asset acquisition and SOX 404 implementation project, which are considered as non-recurring corporate development events and added back for calculation of adjusted EBITDA.

 

The final table which shows our EBIT, EBITDA, and adjusted EBITDA, together reconciled to the loss for the period ended June 30, 2023, and 2022 in this results announcement has more details on the non-IFRS financial measures and the related reconciliations between these financial measures.

 

For More Information:

 

Investors

 

Gary Dvorchak

 

The Blueshirt Group

 

gary@blueshirtgroup.com

 

Media

 

Jeff Fox

 

The Blueshirt Group

 

jeff@blueshirtgroup.com

 

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Gorilla Technology Group Inc. and Subsidiaries
Consolidated Statements of Comprehensive Loss
(Unaudited)
(Expressed in United States dollars)
 
   Six months ended June 30 
Items  2023   2022 
Revenue  $6,429,335   $13,800,930 
Cost of revenue   (3,250,584)   (9,226,561)
Gross profit   3,178,751    4,574,369 
Operating expenses          
Selling and marketing expenses   (901,355)   (1,980,709)
General and administrative expenses   (7,641,876)   (3,295,612)
Research and development expenses   (2,772,621)   (7,766,833)
Other income   79,089    11,037 
Other gains – net   766,456    629,929 
Total operating expenses   (10,470,307)   (12,402,188)
Operating loss   (7,291,556)   (7,827,819)
Non-operating income and expenses          
Interest income   400,516    11,957 
Finance costs   (376,546)   (464,048)
Total non-operating income and expenses   23,970    (452,091)
Loss before income tax   (7,267,586)   (8,279,910)
Income tax expense   (2,172)   (356,130)
Loss for the period  $(7,269,758)  $(8,636,040)
Other comprehensive loss          
Components of other comprehensive loss that may be reclassified to profit or loss          
Exchange differences on translation of foreign operations  $(185,082)  $(874,697)
Other comprehensive loss for the period, net of tax  $(185,082)  $(874,697)
Total comprehensive loss for the period  $(7,454,840)  $(9,510,737)
           
Loss per share          
Basic loss per share  $(0.11)  $(0.29)
           
Diluted loss per share  $(0.11)  $(0.29)

 

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Gorilla Technology Group Inc. and Subsidiaries
Consolidated Balance Sheets
(Unaudited)
(Expressed in United States dollars)

 
Items  June 30,
2023
   December 31,
2022
 
Assets        
Current assets        
Cash and cash equivalents  $10,268,581   $22,996,377 
Financial assets at fair value through profit or loss - current   1,053,621    1,073,229 
Financial assets at amortized cost   8,859,457    6,871,187 
Contract assets   4,551,822    725,441 
Accounts receivable   12,507,386    14,041,611 
Inventories   56,544    68,629 
Prepayments - current   244,039    1,266,442 
Other receivables   732,054    648,617 
Other current assets   38,421    61,803 
Total current assets   38,311,925    47,753,336 
Non-current assets          
Property, plant and equipment   15,731,102    16,132,567 
Right-of-use assets   8,269    16,675 
Intangible assets   9,060,563    56,342 
Deferred income tax assets   29,464    29,905 
Prepayments - non-current   482,230    612,982 
Other non-current assets   939,513    659,071 
Total non-current assets   26,251,141    17,507,542 
Total assets  $64,563,066   $65,260,878 

 

Items  June 30,
2023
   December 31,
2022
 
Liabilities and Equity        
Liabilities        
Current liabilities        
Short-term borrowings  $15,189,220   $13,492,935 
Contract liabilities   113,221    58,475 
Notes payable   593    602 
Accounts payable   3,765,166    6,674,528 
Other payables   5,400,184    3,620,998 
Provisions - current   70,758    88,469 
Lease liabilities   8,387    16,981 
Warrant liabilities   1,328,165    2,042,410 
Long-term borrowings, current portion   2,781,744    2,108,896 
Other current liabilities, others   143,909    152,373 
Total current liabilities   28,801,347    28,256,667 
Non-current liabilities          
Long-term borrowings   6,491,613    8,251,788 
Provisions - non-current   46,887    61,057 
Deferred income tax liabilities   145,997    148,183 
Total non-current liabilities   6,684,497    8,461,028 
Total liabilities   35,485,844    36,717,695 
Equity          
Equity attributable to owners of parent          
Share capital          
Ordinary share   7,174    7,136 
Capital surplus          
Capital surplus   162,719,230    154,730,389 
Retained earnings          
Accumulated deficit   (104,254,138)   (96,984,380)
Other equity interest          
Financial statements translation differences of foreign operations   185,096    370,178 
Treasury shares   (29,580,140)   (29,580,140)
Equity attributable to owners of the parent   29,077,222    28,543,183 
Total equity   29,077,222    28,543,183 
Significant contingent liabilities and unrecognized contract commitments          
Total liabilities and equity  $64,563,066   $65,260,878 

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Gorilla Technology Group Inc. and Subsidiaries

Consolidated Statements of Cash Flows
(Unaudited)
(Expressed in United States dollars)

 

   Six months ended June 30 
   2023   2022 
CASH FLOWS FROM OPERATING ACTIVITIES        
Loss before tax  $(7,267,586)  $(8,279,910)
Adjustments          
Adjustments to reconcile profit (loss)          
Depreciation expenses   321,902    3,420,393 
Amortization expenses   406,573    1,030,193 
Share-based payment expenses   500,000    0 
Share option expenses   38,053    184,943 
Loss on disposal of property, plant and equipment   257    0 
Gains on reversal of accounts and other payables   (68,165)   0 
Gains on financial assets and liabilities at fair value through profit or loss   (616,686)   0 
Interest expense   376,546    464,048 
Interest income   (400,516)   (11,957)
Changes in operating assets and liabilities          
Changes in operating assets          
Contract assets   (3,826,381)   402,155 
Accounts receivable   1,534,225    (1,175,393)
Inventories   12,085    77,038 
Prepayments   1,163,915    (939,900)
Other receivables   (15,757)   (4,010)
Other current assets   (30,319)   2,626 
Other non-current assets   (15,315)   33,359 
Changes in operating liabilities          
Contract liabilities   54,746    (1,386)
Notes payable   (9)   (45)
Accounts payable   (2,846,303)   927,603 
Other payables   (1,288,629)   542,481 
Provisions   (30,203)   (59,016)
Other current liabilities   (8,464)   (34,871)
Cash outflow generated from operations   (12,006,031)   (3,421,649)
Interest received   386,537    11,957 
Interest paid   (388,045)   (313,902)
Tax paid   (12,491)   (360)
Net cash flows used in operating activities   (12,020,030)   (3,723,954)
           
CASH FLOWS FROM INVESTING ACTIVITIES          
Acquisition of property, plant and equipment   (216,672)   (2,815,381)
Acquisition of intangible assets   (3,257,771)   (14,252)
Disposal in financial assets at amortized cost   0    2,225,422 
Investment in financial assets at amortized cost   (1,988,270)   0 
(Increase) decrease in guarantee deposits   (265,127)   34,033 
Net cash flows used in investing activities   (5,727,840)   (570,178)
           
CASH FLOWS FROM FINANCING ACTIVITIES          
Proceeds from short-term borrowings   11,037,443    867,694 
Repayments of short-term borrowings   (9,238,450)   0 
Proceeds from long-term borrowings   0    1,574,876 
Repayments of long-term borrowings   (872,431)   (1,793,622)
Principal repayment of lease liabilities   (8,665)   (26,503)
Loan to Global SPAC Partner Co.   0    (1,165,339)
Payment of transaction cost   0    (87,419)
Exercise of warrants   4,372,875    0 
Net cash flows generated from (used in) financing activities   5,290,772    (630,313)
Effect of foreign exchange rate changes   (270,698)   529,800 
Net decrease in cash and cash equivalents   (12,727,796)   (4,394,645)
Cash and cash equivalents at beginning of period   22,996,377    9,944,748 
Cash and cash equivalents at end of period  $10,268,581   $5,550,103 

 

The following table shows our adjusted EBITDA, together reconciled to the loss for the period ended June 30, 2023, and 2022.

 

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Gorilla Technology Group Inc. and Subsidiaries
Reconciliation of Non-IFRS Financial Measures – Adjusted EBITDA Calculation
(Unaudited)

(Expressed in United States dollars)

 

Items  Six months
ended
June 30,
2023
   Six months
ended
June 30,
2022
 
         
Loss for the period  $(7,269,758)  $(8,636,040)
Depreciation Expense   321,902    3,420,393 
Amortization Expense   406,573    1,030,193 
Income Tax Expense   2,172    356,130 
Interest and Finance Costs   (23,970)   452,091 
Transaction Costs (one time)   3,097,764    2,151,856 
Adjusted EBITDA  $(3,465,317)  $(1,225,377)

 

 

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