Kontrol CEO Paul Ghezzi. (Courtesy Kontrol Technologies Corp.)

Smart building technology developer Kontrol Technologies Corp. has announced a first-quarter record — revenues of $26.6 million, up 702 per cent year-over-year.

The company also posted adjusted EBITDA of $2.5 million – up 123 per cent year-over-year – and a gross profit of $6.7 million – up 281 per cent from Q1 2021. Its net income was $1.6 million, compared to a net loss of $823,733 in the first quarter of last year.

These milestones were “driven by strategic acquisitions, organic growth and continued financial discipline in our balance sheet,” said CEO Paul Ghezzi during the company’s earnings call with investors and analysts.

Kontrol uses software, hardware and service solutions to help its clients improve energy efficiency, air quality and emission monitoring in their buildings.

Kontrol’s present and future

One such example of Vaughan, Ont.-based Kontrol’s (KNR-NE) offerings is its SmartSuite platform, which SustainableBiz reported on in December. It delivers in-suite energy management and real-time control of any HVAC system through a proprietary Internet of Things (IoT), wireless and cloud-based technology.

Kontrol’s CFO Claudio Del Vasto stated during the call that as the company continues to scale, it will “operate its capital structure with discipline.”

Given that buildings contribute nearly 40 per cent of annual greenhouse gas (GHG) emissions, Ghezzi spoke on the challenges asset managers face in reducing that impact.

“To solve these challenges, asset managers and owners will need to adopt more technology in their buildings,” Ghezzi said, “specifically solutions that can assist in the following: the need for deep energy savings; the ability to meet corporate sustainability targets which may also include regulatory reporting; avoiding punitive carbon taxes; dealing with increased shareholder activism; and taking advantage of government investment in green infrastructure.”

He mentioned higher energy costs and interest rates as having direct impact on the profitability of Kontrol’s operations and the value of the buildings which are employing its technology.

Like most companies around the world, Kontrol is not without its supply chain woes. Ghezzi pointed to materials shipments and technology components, but while the delays have introduced some “lumpiness” to the business proceedings, none have had a serious impact so far.

“Across our customer base, as we continue to expand and grow revenue, we are having meaningful conversations about how to better operate buildings with additional technology, services and solutions,” Ghezzi said.

Currently, Kontrol has awarded contracts and letters of intent totalling $25.7 million for HVAC and automation projects.

Kontrol Carbon

The record first-quarter news came on the heels of multiple product announcements in recent months.

In March, the company launched Kontrol Carbon for commercial and industrial clients offering GHG emission verification, carbon offsets and carbon-capture verification.

At the same time, Kontrol, founded in 2006, was selected by an unnamed U.S. REIT to provide its SmartSuite tech in the common area of two commercial buildings.

“The intent of Kontrol Carbon is to provide a unified solution across our platform,” Ghezzi said. “In the industrial market, we will be selling monitoring technology to the high emitters in the oil and gas, concrete, and fabrication sectors where we have an established customer base.”

He also predicts the team will soon have 10 GHG verifiers as Kontrol Carbon expands.

In April, the company announced the development of Kontrol BioWater, an extension of its Kontrol BioCloud. Operating subsidiary BioCloud is a real-time analyzer designed to detect airborne viruses and pathogens. The BioWater solution is intended to be the first real-time, in-the-cloud detection technology for viruses in wastewater.

“Early viral detection is in its infancy as a new strategy and a new industry for dealing with future pandemics,” Ghezzi said. “We continue to invest in BioCloud development, research and expansion.”

Scaling its operations

According to the initial announcement, Kontrol had invested $300,000 toward research and development of BioWater, which includes modifying the existing BioCloud technology.

“We are working diligently to scale the Kontrol platform while maintaining discipline in the management of our capital structure and remain deeply focused on growing profitability,” Ghezzi said in a statement on the first quarter news.

In May, Kontrol launched an at-the-market (ATM) equity program to offer and sell up to $10 million in common shares in the capital of the company from treasury to the public, from time to time. Net proceeds from the program will be used for capital expenditures, working capital and general corporate purposes.

“We believe this is a more opportunistic, strategic and less dilutive capital tool in our arsenal,” Ghezzi said. The company has not raised any capital with the ATM to date.