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MultiSensor AI Announces Fourth Quarter and Full Year 2023 Results

Completed business combination with SportsMap Tech Acquisition Corp. and began trading on December 20, 2023

Demonstrated strong momentum in sales pipeline saturated with global blue-chip companies

BEAUMONT, TX / ACCESSWIRE / April 1, 2024 / MultiSensor AI Holdings, Inc. (NASDAQ:MSAI), a pioneer in AI-powered industrial predictive maintenance and process control solutions, today announced results for the fourth quarter and full year ended December 31, 2023.

Strategic Business Highlights:

  • Completed business combination agreement with SportsMap Tech Acquisition Corp
  • Executed a corporate rebrand changing the Company's name to MultiSensor AI which aligns with the Company's goals to provide AI-driven multi-sensor software solutions in the predictive maintenance market
  • Unveiled new SmartIR 2.0 software platform which added new sensor modalities and AI-powered analytic capabilities to its existing platform
  • Subsequent to quarter end, the Company announced the waiver of earnout share issuances and release of lock-up restrictions

David Gow, Multisensor AI's chairman, commented, "I am pleased to report the results of Multisensor AI's first quarter as a public company. Within the quarter, our primary focus was executing the business combination agreement. As a result of this, the process included a number of one-time expenses, which adversely affected the quarter's results. Despite these costs, we experienced strong sales momentum in the latter half of the quarter, as we increased our presence among blue-chip customers and supplemented our pipeline. Additionally, we remain focused on further establishing our ARR base, which, as it expands, will significantly contribute to margin enhancement and bottom-line growth.

David Gow continued, "Looking forward, we are both opportunistic and enthusiastic about the direction of this Company in 2024 and beyond. Primarily, we will continue expanding our customer base, optimizing sales operations, refining and improving our product offerings, and identifying new growth opportunities. While there is much still to be done, we have confidence we can broaden our strong presence in this high-growth market and deliver sustainable, profitable growth for our stakeholders."

About MultiSensor AI

MultiSensor AI provides turnkey predictive maintenance and process control solutions, which combine cutting edge imaging and sensing technologies with AI-powered enterprise software. Powered by AWS, MSAI's software leverages a continuous stream of data from thermal imaging, visible imaging, acoustic imaging, vibration sensing, and laser sensing devices to provide comprehensive, real-time condition monitoring for a customer's critical assets, processes, and manufactured outputs. This full-stack solution measures heat, vision, vibration, and gas in the surrounding environment, helping companies gain predictive insights to efficiently and proactively manage their asset reliability and manufacturing processes. MSAI's cloud and edge solutions are deployed by organizations to protect critical assets across a wide range of industries including distribution & logistics, manufacturing, utilities, and oil & gas.

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Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. In some cases, forward-looking statements can be identified by words such as "will," "believe," "anticipate," "expect," "estimate," "intend," "plan," or their negatives or variations of these words, or similar expressions. All statements contained in this press release that do not strictly relate to matters of historical fact should be considered forward-looking statements, including, without limitation, statements regarding the combined company management's expectations regarding its financial outlook, strategic priorities and objectives, future plans, business prospects and financial performance, ability to satisfy the initial listing criteria of Nasdaq, ability to deliver value to its stakeholders and grow as a public company. These forward-looking statements are subject to risks, uncertainties and assumptions, some of which are beyond our control. In addition, these forward-looking statements reflect our current views with respect to future events and are not a guarantee of future performance. Actual outcomes may differ materially from the information contained in the forward-looking statements as a result of a number of factors, including, our ability to recognize the anticipated benefits of the business combination, which may be affected by, among other things, competition and the ability of the combined company to grow and manage growth profitably following the business combination; costs related to the business combination; changes in applicable laws or regulations; our ability to implement business plans, forecasts, and other expectations after the completion of the business combination, and identify and realize additional opportunities; the risk of downturns and the possibility of rapid change in the highly competitive industry in which we operate; the risk that we and our current and future collaborators are unable to successfully develop and commercialize our products or services, or experience significant delays in doing so; the risk that we may never achieve or sustain profitability; the risk that we will need to raise additional capital to execute our business plan, which may not be available on acceptable terms or at all; the risk that we experience difficulties in managing our expected growth and expanding operations; the risk that third party suppliers and manufacturers are not able to fully and timely meet their obligations; the risk that we are unable to secure or protect our intellectual property; the possibility that we may be adversely affected by other economic, business, and/or competitive factors; and other risks and uncertainties discussed under the "Risk Factors" section of SportsMap Tech Acquisition Corp.'s prospectus in the registration statement on Form S-1/A filed with the Securities and Exchange Commission on December 18, 2023, and the combined company's other periodic filings with the SEC. Because forward-looking statements are inherently subject to risks and uncertainties, you should not rely on these forward-looking statements as predictions of future events. Any forward-looking statement made in this press release is based only on information currently available and speaks only as of the date on which it is made. Except as required by applicable law, the combined company expressly disclaims any obligations to publicly update any forward-looking statements, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

Media Contact:
MultiSensor AI
Andrew Klobucar
Director of Marketing

Investor Contact:
Alpha IR Group
Mike Cummings or Griffin Morris

MultiSensor AI Holdings, Inc.
Condensed Consolidated Statements of Operations

(Amounts in thousands of U.S. dollars, except share and per share data)

Year Ended December 31,
2023 2022
Revenue, net
$ 5,430 $ 7,268
Cost of goods sold (exclusive of depreciation)
3,986 4,964
Operating expenses:
Selling, general and administrative
22,105 13,606
872 561
Casualty losses, net of recoveries
- 155
Total operating expenses
22,977 14,322
Operating loss
(21,533 ) (12,018 )
Interest expense
64 32
Interest expense, related parties
30 83
Change in fair value of convertible notes
(970 ) -
Tariff refund
(2,401 ) -
Change in fair value of warrants liabilities
(195 ) -
Loss on financing transaction
4,043 -
Other (income) expenses, net
(44 ) (48 )
Loss before income taxes
(22,060 ) (12,085 )
Income tax expense
208 1,205
Net loss
$ (22,268 ) $ (13,290 )
Weighted-average shares outstanding, basic and diluted
6,257,476 5,292,384
6,257,476 5,292,384
Net loss per share, basic and diluted
(3.56 ) (2.51 )
(3.56 ) (2.51 )

MultiSensor AI Holdings, Inc.
Condensed Consolidated Statements of Changes in Shareholders' Equity

(Amounts in thousands of U.S. dollars, except share and per share data)

Additional Retained Shareholders'
Class A Common Stock Paid- In Earnings Equity
Shares Amount Capital (Deficit) (Deficit)
January 1, 2022, as previously reported
514,946 $ - $ 2,010 $ 2,427 $ 4,437
Elimination of historical equity
(514,946 ) - - - -
Retroactive application of recapitalization
5,292,384 - - - -
Adjusted Balance at January 1, 2022
5,292,384 $ - $ 2,010 $ 2,427 $ 4,437
Net loss
- - - (13,290 ) (13,290 )
Share-based compensation
- - 644 - 644
Balance at December 31, 2022
5,292,384 $ - $ 2,654 $ (10,863 ) $ (8,209 )
Net loss
- - - (22,268 ) (22,268 )
Conversion of shareholder promissory note
1,459,700 - 18,501 - 18,501
Conversion of convertible notes
550,486 - 2,054 - 2,054
Financing transaction shares
680,500 - 4,641 - 4,641
Issuance of common stock
282,074 - - - -
Merger recapitalization (Note 3)
3,691,679 1 (1,454 ) - (1,453 )
Deferred transaction costs
- - (7,595 ) - (7,595 )
Share-based compensation
- - 14,061 - 14,061
Balance at December 31, 2023
11,956,823 $ 1 $ 32,862 $ (33,131 ) $ (268 )

MultiSensor AI Holdings, Inc.
Consolidated Statements of Cash Flows

(Amounts in thousands of U.S. dollars)

Year Ended December 31,
2023 2022
Operating Activities
Net loss
$ (22,268 ) $ (13,290 )
Adjustments to reconcile net loss to net cash: (used in) provided by operating activities
872 561
Allowance for doubtful accounts
194 158
Inventories impairment
1,689 -
Non-cash lease expense
(26 ) 102
Inventory casualty losses
- 1,376
Deferred income tax expense
(72 ) 1,200
Share-based compensation
14,061 644
Non-cash PIK interest
30 83
(Gain) on sale of equipment
(18 ) -
Loss on financing transaction
4,043 -
Change in fair value of warrants liabilities
(195 ) -
Change in fair value of convertible notes
(970 ) -
Increase (decrease) in cash resulting from changes in:
Trade accounts receivable
(928 ) (211 )
Deferred transaction costs
(1,098 ) -
372 284
Other current assets
1,144 1,306
Other noncurrent assets
- (1 )
Trade accounts payable
(14 ) 461
Income taxes payable
480 511
Income taxes receivable
1 1,645
Contract liability
1,657 212
Other current liabilities
(110 ) (14 )
Right of use liabilities
(163 ) (105 )
Accrued expenses
(3,343 ) 1,897
Other liabilities
111 11
Net cash used in operating activities
(4,551 ) (3,170 )
Investing Activities
Capital expenditures
(1,542 ) (1,600 )
Proceeds from sale of equipment
30 -
Net cash used in investing activities
(1,512 ) (1,600 )
Financing Activities
Proceeds of First Insurance Funding line of credit
647 -
Repayments of First Insurance Funding line of credit
(25 ) -
Proceeds of Wells Fargo line of credit
- 1,400
Repayments of Wells Fargo line of credit
- (1,400 )
Proceeds of B1 Bank line of credit
900 -
Repayments of B1 Bank line of credit
(900 ) -
Proceeds from SMAP related party promissory note
1,524 -
Proceeds from related party promissory notes
575 1,000
Proceeds from shareholder promissory notes
- 200
Repayments on shareholder promissory notes
(100 ) (100 )
Proceeds from convertible notes
1,806 950
Proceeds from financing transaction
4,481 -
Merger recapitalization
(2,344 ) -
Net cash provided by financing activities
6,564 2,050
Net increase/(decrease) in cash and cash equivalents
501 (2,720 )
Cash and cash equivalents, beginning of year
654 3,374
Cash and cash equivalents, end of the year
$ 1,155 $ 654

Supplemental cash flow information
Interest paid
$ 52 $ 29
Income taxes paid
6 33

Non-cash investing and financing transactions
Conversion of shareholder promissory note and accrued interests into common stock
$ 18,501 $ -
Conversion of convertible notes and accrued interest into common stock
$ 2,054 $ -
Conversion of related party promissory note into convertible note
$ 1,000 $ -
Conversion of Legacy SMAP related party promissory notes into convertible notes
$ 1,324 $ -
Transfer of inducement shares in financing transaction
$ 4,641 $ -

SOURCE: MultiSensor AI Holdings, Inc.

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