Newtopia Reports Second Quarter 2024 Financial Results

Newtopia is well-positioned to grow and create value in key market opportunities at the forefront of global healthcare:

• Growth of GLP-1s: Our engagement expertise provides unique ability to facilitate sustainable health outcomes and demonstrable ROI to GLP-1 sponsors
• Rise of Health AI: Our unique data sets and capabilities will enrich and accelerate progress of next-gen clinical discovery platforms
• Commercial and Community Care-Delivery: We see continued expansion with our market-leading employer, provider and provincial innovation partners

TORONTO, Aug. 8, 2024 /PRNewswire/ - Newtopia Inc. ("Newtopia" or the "Company") (TSXV: NEWU) (OTCQB: NEWUF), a tech-enabled whole health platform creating sustainable habits that prevent, slow and reverse chronic disease, today announced its second quarter 2024 financial results, operational highlights and filing of its financial statements. These results pertain to the three months ended June 30, 2024. All amounts are expressed in Canadian dollars, unless otherwise noted.

Second Quarter 2024 Financial Highlights (vs. Q2 2023):

• Revenue of $1.6 million, as compared to $2.4 million
• Gross Profit margin of 48%, as compared to 50%
• Opex reduction of 18% year over year

"Over the last eleven years Newtopia's habit change solution has repeatedly proven our unique ability to produce industry leading patient engagement and to cultivate in our users the healthy habits that can prevent, slow and even reverse chronic metabolic disease. We've positioned ourselves at the forefront of healthcare developments, strengthened underlying operations, and evolved with value-based industry needs. As the economy strengthens Newtopia will be best positioned to support the innovative payers looking to drive proven health outcomes."

"Beginning with our industry-first randomized, controlled clinical trial between 2013-2016 and extending to the Fortune 500 employers that have adopted our solution, Newtopia has consistently delivered weight loss and reductions in A1C in participants that are not only clinically significant, but also sustainable over time. This has translated into meaningful cost-savings for our employer-partners and program sponsors and improved the health and well-being for the more than 100,000 individuals whom we have served, irrespective of their setting, geography, healthy equity or socio-economic status. Most recently, Newtopia reported six-month outcomes from its trial with Heartland Whole Health Institute in which we delivered our best-ever engagement rates and weight loss outcomes in both provider and employer environments."

"On the strength of this foundation,  we are pursuing three distinct and significant opportunities to accelerate Newtopia's growth including: (1) expanding our key innovation partnerships with providers, employers and provincial payers; (2) combining Newtopia's proven habit change platform with GLP-1 drugs for obesity and type 2 diabetes; and (3) partnering with health AI and clinical discovery innovators to improve our collective ability to deliver best in breed outcomes that prevent, reverse and slow chronic disease", said Jeff Ruby, Founder and CEO of Newtopia.

Second Quarter 2024 Financial Results

Revenue for the three months ended June 30, 2024 was $1.6 million, compared to $2.4 million in the prior-year period. This decline was driven by a change made by a client with a long-standing incentive program, which the Company is actively working to offset.

Gross profit for the second quarter 2024 totaled $0.8 million, as compared to $1.2 million in the prior-year period. Gross profit is comprised of Newtopia's revenue less the cost of Welcome Kits sold to new participants, labor costs associated with the Company's coaching team of Inspirators, and amortization on the Company's capitalized technology investments.

Operating expenses for the three months ended June 30, 2024 totaled $1.5 million, compared to $1.8 million in the prior-year period. For the second quarter, the Company posted an operating loss of $727 thousand, compared to a loss of $436 thousand in the prior year period.

The Company ended the second quarter 2024 with $0.52 million in cash, with additional access to their revolving line of credit with a Canadian Schedule 1 bank.

2024 Outlook

Despite a challenging macro environment, the Company remains bullish regarding its strategic fit within the broader healthcare industry. Newtopia will continue to execute on its pipeline to return to EBITDA positive.

Conference Call

The Company will host a conference call on August 8^th at 5 p.m. Eastern Time to discuss the second quarter 2024 results in further detail. To access the conference call, please dial (800) 717-1738 (U.S.) or (646) 307-1865 (International) 10 minutes prior to the start time and reference Conference ID number 04296. The call will also be available via live webcast on the investor relations portion of the Company's website located at investor.newtopia.com.

A replay of the conference call will be available through August 29, 2024, which can be accessed by dialing (844) 512-2921 (U.S.) or (412) 317-6671 (International) and entering the passcode 11156555. The webcast will also be archived on the Company's website.

About Newtopia

Newtopia is a personalized whole health platform helping people create positive lifelong habits that prevent, slow, or reverse chronic disease while reducing healthcare costs. The platform leverages genetic, social and behavioral insights to create individualized prevention programs with a focus on metabolic disease, diabetes, mental health challenges, hypertension, weight management and musculoskeletal disorders. With a person-centered approach that combines virtual care, digital tools, connected devices and actionable data science, Newtopia delivers sustainable clinical and financial outcomes. Newtopia serves some of the largest nationwide employers and health plans and is currently listed in Canada on the TSX Venture Exchange (TSXV: NEWU) and is quoted in the US on the OTCQB^® Venture Market (OTCQB: NEWUF). To  learn more, visit newtopia.com, LinkedIn or X.

Forward Looking Statements

This news release contains forward-looking information and forward-looking statements, within the meaning of applicable Canadian securities legislation, and forward looking statements, within the meaning of applicable United States securities legislation (collectively, "forward-looking statements"), which reflects management's expectations regarding Newtopia's future growth, results from operations (including, without limitation, future production and capital expenditures), performance (both operational and financial) and business prospects and opportunities. Wherever possible, words such as "predicts", "projects", "targets", "plans", "expects", "does not expect", "budget", "scheduled", "estimates", "forecasts", "anticipate" or "does not anticipate", "believe", "intend" and similar expressions or statements that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved, or the negative or grammatical variation thereof or other variations thereof, or comparable terminology have been used to identify forward-looking statements. All statements other than statements of historical fact may be forward- looking information. Such statements reflect Newtopia's current views and intentions with respect to future events, based on information available to Newtopia, and are subject to certain risks, uncertainties, and assumptions. Material factors or assumptions were applied in providing forward-looking information. While forward-looking statements are based on data, assumptions and analyses that Newtopia believes are reasonable under the circumstances, whether actual results, performance or developments will meet Newtopia's expectations and predictions depends on a number of risks and uncertainties that could cause the actual results, performance and financial condition of Newtopia to differ materially from its expectations. Forward-looking statements are not a guarantee and are based on a number of estimates and assumptions management believes to be relevant and reasonable, whether actual results, performance or developments will meet Newtopia's expectations and predictions depends on a number of risks and uncertainties that could cause the actual results, performance and financial condition of Newtopia to differ materially from its expectations. Certain of the "risk factors" that could cause actual results to differ materially from Newtopia's forward-looking statements in this press release include, without limitation: the termination of contracts by clients, risks related to COVID-19 including various recommendations, orders and measures of governmental authorities to try to limit the pandemic, including travel restrictions, border closures, non-essential business closures, quarantines, self-isolations, shelters- in-place and social distancing, disruptions to markets, economic activity, financing, supply chains and sales channels, and a deterioration of general economic conditions including a possible national or global recession; and other general economic, market and business conditions and factors, including the risk factors discussed or referred to in Newtopia's disclosure documents, filed with the securities regulatory authorities in certain provinces of Canada and available at www.sedarplus.ca including Newtopia's final long form prospectus dated March 30, 2020.

For more information on these risks please see the "Risk Factors" in Newtopia's final long-form prospectus dated March 30, 2020. Should any factor affect Newtopia in an unexpected manner, or should assumptions underlying the forward-looking information prove incorrect, the actual results or events may differ materially from the results or events predicted. Any such forward-looking information is expressly qualified in its entirety by this cautionary statement. Moreover, Newtopia does not assume responsibility for the accuracy or completeness of such forward-looking information. The forward-looking information included in this news release is made as of the date of this news release, and Newtopia undertakes no obligation to publicly update or revise any forward-looking information, other than as required by applicable law.

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

Key Financial Measures and Schedule of Non-GAAP Reconciliations
Unaudited Gross Profit Information- including
amortization

Reconciliation of Total Operating Expenses to Adjusted Operating Expenses

Unaudited Adjusted Operating Loss

Newtopia Inc.
Condensed Interim Consolidated Statements of Financial Position  (Unaudited)
As at June 30, 2024 and December 31, 2023
(Expressed in Canadian Dollars)

Newtopia Inc.
Condensed Interim Consolidated Statements of Loss and Comprehensive Loss (Unaudited)
Six Months Ended June 30, 2024
(Expressed in Canadian Dollars)

Newtopia Inc.
Condensed Interim Statements of Cash Flows (Unaudited)
Six Months Ended June 30, 2024 
(Expressed in Canadian Dollars)

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SOURCE Newtopia Inc.