Charge Enterprises Announces Fourth Quarter 2021 Financial Results

Q4 Revenue of $119.3 Million, A Sequential Increase from Q3 Revenue of $117.1 Million

Fortifying Foundation for Scale, Geographic Footprint and Capabilities Expansion to Drive Growth in Emerging Sector

NEW YORK, NY / ACCESSWIRE / March 29, 2022 / Charge Enterprises Inc. (OTC PINK:CRGE) ("Charge"), consisting of a portfolio of global businesses with the vision of connecting people everywhere with communications and electric-vehicle charging ("EV") infrastructure, today reported its financial results for the three-month period and twelve-month period ended December 31, 2021.

Fourth Quarter 2021 Results - Selected Financial Information

"Charge made tremendous progress in Q4 toward our goal of becoming the trusted global infrastructure partner for 5G wireless network and intelligent sites as well as EV Charging. We continued to build our 5G wireless network / EV charging infrastructure growth engine through a selective acquisition, drove organic growth through successful customer engagement in the EV charging infrastructure sector, expanded our talented team and further refined our processes for scalability," Charge's Chairman and CEO Andrew Fox stated. "Through the BWES acquisition, we significantly expanded our electrical contracting capabilities and expertise, adding scalability in 5G and network services as well as EV charging infrastructure deployment resources, establishing Charge's position with organized labor workforce and welcoming an impressive and experienced team of qualified master electricians. BWES and ANS are a powerful combination, and we are working to bring additional value to customers as we unify their product offerings and leverage their capabilities across their respective territories for growth. EV Depot, acquired in January, is an early mover in licensing parking facilities to create charging ecosystems, scaling our infrastructure offering and capabilities for ecommerce, commercial and delivery fleets. Last, we markedly advanced our internal processes and corporate governance structures in preparation for an uplist to the Nasdaq Capital Market."

"In all, we capped off a transformational year and fortified our foundation for future expansion of our capabilities and geographic footprint to drive growth in the expansive, emerging addressable market at the intersection of 5G wireless and EV charging electrical infrastructure. Looking ahead, we are very pleased with our ANS and BWES subsidiaries' strong performances. BWES serves many customers within the public sector, which tends to have multi-year projects with revenue being recognized over several calendar years. Our goal remains to be the trusted global infrastructure partner for 5G wireless network and intelligent sites as well as EV Charging."

Reported results include: TransWorld Enterprises, Inc., acquired on May 8, 2020; GetCharged, Inc., acquired on October 12, 2020; PTGI International Carrier Services, Inc. ("PTGI") acquired on October 31, 2020; ANS Advanced Network Services ("ANS") acquired on May 21, 2021; and BW Electrical Services LLC (BWES") acquired on December 27, 2021, and are therefore not comparable to year-ago periods.

Proforma results include: The full three- or twelve-month period for all operations, including acquisitions, for both 2020 and 2021. Management believes that presenting pro forma results is important to understanding the Company's financial performance, providing better analysis of trends in our underlying businesses as it allows for comparability to prior period results.

Fourth quarter proforma revenue was $126.8 million, a decrease of $4.5 million from the same period last year, driven by declines in Telecommunications' wholesale call volume offset by solid growth within Infrastructure's higher-margin 5G and wireless installation and electrical construction.

Fourth quarter proforma net loss of $14.5 million decreased $20.0 million from the same period last year due to impairment charges and stock issuance costs in 2020 offset by higher stock compensation expense in 2021 due to expansion in personnel associated with the Company's growth.

Cash used in operations for the full year 2021 was $2.9 million, including investments in corporate governance and the buildout of Charge's management team to both strengthen its public company structure and support organic growth, as well as acquisition-related expenses.

Charge's CFO Leah Schweller commented, "While inflation did have some impact on fourth quarter results and tight supply chains and labor markets are realities for growing businesses, our margins at the operating subsidiary level are holding to date, and we remain vigilant to combat margin erosion in this challenging geopolitical, inflationary and supply chain environment. As we had hoped, recently acquired businesses are performing solidly and are expected to contribute incrementally as we fully integrate them, leverage their capabilities, and drive higher margin revenue."

As of December 31,2021, Charge held $27.9 million in cash, cash equivalents and marketable securities.

For further details of the financials, please see Charge Enterprises' 2021 Form 10-K filed with the Securities and Exchange Commission. Note the quarterly financial statements for March 31, 2021 and June 30, 2021 were refiled with the OTC Markets on November 12, 2021. The quarterly financial statements for September 30, 2021 were filed with the OTC Markets on November 18, 2021.

Key Recent Highlights

• Continued to build scale and capabilities -
  • Acquired BW Electrical Services - scales Charge's EV charging infrastructure deployment by boosting the number of qualified master electricians and adding greater value, electrical contracting expertise, and warehousing capacity to improve lead times and increase bandwidth to serve the Company's growing client portfolio. BWES also establishes Charge's union workforce and brings proven standardized processes and deep commercial electrical expertise in EV charging infrastructure, complementing Charge's existing offering. Finally, BWES and ANS combined add significant value and revenue opportunity at the cross-over of wireless and electrical infrastructure as they continue to integrate and expand into each other's territories.
  • Entered into strategic alliances with Smart Charge America and National Community Renaissance for EV charging infrastructure.
  • Subsequent to year-end, acquired EV Group Holdings, LLC (EV Depot) - Scales Charge's infrastructure offering to ecommerce, commercial and fleet delivery service providers. With its first-mover advantage, EV Depot leases scarce industrial real estate from third parties and licenses to large fleet operators that require multiple services, including parking, maintenance and other resources, serving as a strong platform to develop emerging business models, including high-capacity charging, the EV "gas station" of the future and logistical energy centers.
• Developed leadership team - Expanded the talented client-facing team within Infrastructure
  • Strengthened Detroit, MI-based team focused on developing EV charging business - President Mark LaNeve and Chief Business Officer Nicole Antakli have added Directors of Engineering, Client Engagement, Administration & Operations and OEM & EV Charging - collectively encompassing 100-plus years of automotive experience with particular depth of expertise in the automotive OEM vertical. This team is dedicated to driving organic growth and is now building an internal capability focused on client engagement, education, design and engineering and project management.
• Strengthened corporate structure - Continued investments in people, processes and systems to support public company organization
• Developed strategic relationships to drive future growth -
  • Subsequent to year-end, was designated as the Preferred Infrastructure Provider for GenZ EV LLC, a distributor of ADS-TEC Energy battery-buffered ultra-fast chargers for the automotive vertical in the Americas, for custom EV charging ecosystems. Charge Infrastructure will offer comprehensive suite of services for EV charging ecosystems, including project management, design and engineering, construction, installation, and maintenance and service. GenZ and Charge will target dealerships, dealer groups, commercial fleet, and automotive OEM's as well as retail, big-box chains, real estate conglomerates and the public sector.
• Bolstered corporate governance -
  • Added three independent members to Board of Directors
  • Named COO Craig Denson Chief Compliance Officer, Secretary
  • Strengthened board governance in anticipation of Exchange uplist

Large Market Opportunity

Charge is uniquely positioned to capitalize on the present market opportunity by developing and deploying infrastructure, making it simple to move and connect people across the globe, installing 5G, in-building wireless networks and EV charging ecosystems and delivering the infrastructure clients require today to grow with them as scale is required to meet future demands. There are a number of strong tailwinds both investment and demand, with investments in Charge's total addressable EV / 5G Infrastructure market being driven from private, enterprise, and public sectors alike, which combined total $224 billion*, including $72.5 billion public funds (Infrastructure bill) earmarked for EV charging, including a national network of 500,000 EV charging stations**, and billions more in the private sector, by 2028.

* The White House | President Biden Announces Support for the Bipartisan Infrastructure Framework

** The White House | Remarks of President Joe Biden - State of the Union Address As Prepared for Delivery

2022-23 Strategy and Priorities

"As we add building blocks to our foundation and gather customer needs and preferences across a range of industry sectors, we have honed our strategy for scalability while optimizing a holistic approach that provides a highly responsive and reliable infrastructure offering that addresses engineering, technology and energy and equipment cost management needs. Our value proposition is differentiated by our hardware- and software-agnostic approach that centers on tailoring bespoke installations to the requirements of each customer, creating customized electric vehicle charging solutions and positioning clients to support organic growth in the future. As we move through the next 18 months, we will continue to be deliberate and thoughtful as we add talent and refine our internal public company processes to drive our success as we simultaneously pioneer a new industry and identify and secure the resources needed to address today's demands at the cross-over of wireless and electrical infrastructure and capture the opportunities and use cases of the future," stated Mr. Fox.

Charge's overarching strategy is to integrate high-quality assets with growing recurring revenue streams across its core competencies of building infrastructure for 5G wireless networks and EV charging ecosystem solutions:

Telecommunications

• Continue to leverage 20-year global customer relationships and a variable cost model for growth, strengthening this division as a foundation underlying Charge's consolidated revenue base
• Selectively add products and services with solid margins, such as SMS text, to this long-established business

Infrastructure

• Scale wireless/electrical infrastructure capabilities - Charge's strategy is to grow ANS' private sector and BWES' public sector capabilities in wireless network and electrical charging infrastructure, uniting their complementary offerings and resources to fuel growth into each other's territories. This combination offers a powerful unique, one-stop value proposition for clients' wireless network and electrical charging ecosystem installation needs, starting in New York and New Jersey.
• EV infrastructure platform - Charge's Michigan team will address tremendous demand in the explosively growing EV space, exemplified by numerous EV launches announced by automotive OEMs, increasing EV capacity and new EV entrants in the US market. Leveraging Charge's long-standing relationships in the automotive OEM vertical, the team's strategy is focused on a 4-pronged approach to: grow organically by building out our internal team; leverage Charge subsidiaries' capabilities; build a network of installers to support organic growth; and add targeted acquisitions and strategic alliances to scale for future growth opportunities in additional sectors such as retail, office complexes and multi-unit housing:
  • Drive organic growth by expanding our internal management team to execute continued education and guidance encompassing the critical elements of uptime and total cost of ownership for EV charging infrastructure solutions, optimal client-engagement and dedicated project management of our services;
  • Leverage the expertise, capability and skill from the ANS, BWES and EV Depot workforces and subcontractor networks to a add greater value integrated into our seamless solution providing a unique and superlative customer experience in bespoke installations, including project management, design and engineering, construction, installation, and maintenance;
  • Build a nationwide network of local contractors, electricians and engineering firms to execute the expansion and scale as Charge's leadership team establishes and grows relationships with key customers in varying industry sectors, including automotive dealerships, auto OEMs, commercial fleet and other industrial and public sectors;
  • Continue to selectively seek acquisition opportunities and strategic partnerships that expand greater scale, enhance services and create additional value vertically and horizontally within the supply chain of adapting infrastructure implementation for EV Charging and 5G wireless networks, DAS, small cell and intelligent sites.

Finally, Charge will continue to invest in talent with world class industry experience at both the divisional and corporate levels to drive growth.

About Charge Enterprises Inc.

Telecommunications

Our Telecommunications business ("Telecommunications") has provided termination of both voice and data to Carriers and Mobile Network Operators ("MNOs") globally for over two decades and we will selectively add profitable products and services to this long-established business.

Infrastructure

Our Infrastructure business ("Infrastructure") has a primary focus on two fast growing sectors: electric vehicle ("EV") charging, and Telecommunications Network 5G, including cell tower, small cell, and in-building applications. Solutions for these two sectors include: Design and Engineering, Equipment specification and sourcing, Installation, Data & software solutions, and Service and Maintenance.

To learn more about Charge, visit Charge Enterprises.

Notice Regarding Forward-Looking Information

This press release contains forward-looking statements, as defined in applicable securities laws. Forward-looking statements reflect current expectations or beliefs regarding future events or Charge's future performance. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "continues", "forecasts", "projects", "predicts", "intends", "anticipates", "targets" or "believes", or variations of, or the negatives of, such words and phrases or state that certain actions, events or results "may", "could", "would", "should", "might" or "will" be taken, occur or be achieved. All forward-looking statements, including those herein are qualified by this cautionary statement.

Although Charge believes that the expectations expressed in such forward looking statements are based on reasonable assumptions, such statements involve risks and uncertainties, and actual results may differ materially from any future results expressed or implied by such forward-looking statements. Such risks and uncertainties include the business plans and strategies of Charge, Charge's future business development, market acceptance of electric vehicles, Charge's ability to generate profits and positive cash flow, and changes in government regulations and government incentives, subsidies, or other favorable government policies. Readers are cautioned that the foregoing list of risks and uncertainties is not exhaustive of the factors that may affect forward-looking statements. Accordingly, readers should not place undue reliance on forward-looking statements. The forward-looking statements in this press release speak only as of the date of this press release or as of the date or dates specified in such statements. For more information on Charge, investors are encouraged to review Charge's public filings on OTC Market at https://www.otcmarkets.com/stock/CRGE/overview. Charge disclaims any intention or obligation to update or revise any forward- looking information, whether as a result of new information, future events or otherwise, other than as required by law.

Media Contacts:

Steve Keyes (248) 952-7022
Steve.keyes@centigrade.com

Investor Relations:

Carolyn Capaccio, CFA (212) 838-3777
Ccapaccio@lhai.com

CHARGE ENTERPRISES, INC.
Reported and Proforma Results of Operations
Years ending December 31, 2021 and 2020

CHARGE ENTERPRISES, INC.
CONSOLIDATED BALANCE SHEETS

CHARGE ENTERPRISES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS

CHARGE ENTERPRISES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS

SOURCE: Charge Enterprises Inc.