Pineapple Financial Anticipates Growth Surge Amid Bank of Canada’s Consecutive Rate Cuts and Rising Housing Completions

Toronto, ON – September 4, 2024 – Pineapple Financial Inc. (NYSE American: PAPL), a leading digital mortgage firm with an integrated network of partner brokerages and agents across Canada is strategically positioned to capture significant market share and drive revenue growth following the Bank of Canada’s recent 25-basis-point rate cut, bringing the benchmark interest rate to 4.25%. As Canada enters a period of potential housing market upswing, Pineapple’s scalable data-driven technology platform and market expertise are set to capitalize on the anticipated increase in mortgage activity while streamlining the home-buying process.

Market Dynamics: A Surge in Housing Completions and Mortgage Renewals

In 2023, Canada saw over 240,000 housing completions, with an additional 260,000 units expected to be completed by the end of 2024 and increasing into 2025. This surge in housing supply is set to drive increased demand for mortgage financing as new homeowners enter the market. Additionally, approximately 1.2 million mortgages, representing 20% of the total Canadian mortgage market, are set to renew within the next 12 months.

These renewals, coupled with the influx of new mortgage originations, present a substantial business opportunity for Pineapple. With the average mortgage size in Canada at approximately $370,000, this renewal wave alone represents over $440 billion in potential mortgage volume.

Pineapple’s advanced platform, PineappleONE, is designed to identify and target these opportunities with precision. By utilizing real-time data analytics, Pineapple can segment and engage customers who are most likely to benefit from refinancing or new mortgage products in this lower-rate environment. This targeted approach not only enhances customer acquisition but also maximizes retention, which is critical for sustaining growth.

Revenue Impact: Translating Market Opportunities into Growth

Given the anticipated volume of mortgage renewals and originations, Pineapple is well-positioned to experience significant revenue growth while driving continuous margin improvement. We project an increase of 18-22% year-over-year revenue growth, driven by our ability to capitalize on the renewal market, cross-selling opportunities, and the enhanced customer acquisition made possible through our data-driven technology platform. This growth is underpinned by our strategic focus on retaining customers and expanding our market share in both renewals and new mortgage originations.

Outlook: Future Rate Cuts and Continued Expansion

The Bank of Canada’s recent rate cuts signal the potential for further easing if economic conditions warrant it. Should additional rate cuts occur, the affordability of mortgages will improve, likely leading to even greater demand for refinancing and new mortgages. Pineapple is prepared to adapt to these market conditions, positioning itself as a key player in the Canadian mortgage market.

Pineapple offers a compelling growth story grounded in market dynamics that is disrupting the traditional mortgage brokerage model by empowering agents and their clients with a scalable data driven technology platform tailored to fit their diverse needs. Our ability to harness data, coupled with a robust pipeline of mortgage renewals and new originations, positions us to drive significant revenue growth in the coming quarters. As the Canadian housing market continues to evolve, Pineapple is poised to deliver strong, sustainable returns.

Footnote and references

1. Mortgage Renewal Volume:
   1. Canadian Mortgage and Housing Corporation (CMHC) reports
   2. Industry reports from mortgage institutions and financial analysts
2. Housing Completions:
   1. CMHC housing starts and completions data
   2. Statistics Canada: Residential construction and housing completions data
3. Interest Rate Cuts and Macroeconomic Trends:
   1. Bank of Canada monetary policy updates and rate
   2. Global News, Bloomberg
4. Canadian Mortgage Market Potential:
   1. CMHC Mortgage Market Review

About Pineapple Financial Inc.

Pineapple Financial Inc. is an award-winning fintech and leading Canadian mortgage brokerage network,focusing on both the long-term success of agents and brokerages, as well as the overall experience of homeowners. With approximately 700 brokers within the network, Pineapple creates cutting-edge cloud-based tools and AI-driven systems to enable its brokers to help Canadians realize their dream of owning a home. Pineapple is active within the community and is proud to sponsor charities across Canada to improve the lives of fellow Canadians.

Forward-Looking Statements

Certain statements in this announcement are forward-looking statements, including, but not limited to, the Company's proposed Offering. These forward-looking statements involve known and unknown risks and uncertainties and are based on the Company's current expectations and projections about future events that the Company believes may affect its financial condition, results of operations, business strategy and financial needs, including the expectation that the Offering will be successfully completed. Investors can identify these forward-looking statements by words or phrases such as "may," "will," "expect," "anticipate," "aim," "estimate," "intend," "plan," "believe," "is/are likely to," "potential," "continue" or other similar expressions. The Company undertakes no obligation to update or revise publicly any forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations that arise after the date hereof, except as may be required by law. These statements are subject to uncertainties and risks including, but not limited to, the uncertainties related to market conditions and the completion of the initial public offering on the anticipated terms or at all, and other factors discussed in the "Risk Factors" section of the registration statement filed with the SEC. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and the Company cautions investors that actual results may differ materially from the anticipated results and encourages investors to review other factors that may affect its future results in the Company's registration statement and other filings with the SEC. Additional factors are discussed in the Company's filings with the SEC, which are available for review at www.sec.gov.

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Related Links:

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Media Contact:

For media inquiries, please contact Alexandria Guo, Marketing Manager at Pineapple

Email: alexandria@gopineapple.com

Investor Relations Contact:

For investor relations inquiries, please contact Shubha Dasgupta, Chief Executive Officer, at Pineapple

Email: shubha@gopineapple.com

Phone: +1 (416) 669-2046