Q3/2022 HIGHLIGHTS
- Total contracted revenue (backlog) increases 105% to
$33.9 million during the nine months
ended September 30, 2022.
- Revenue growth of 133% during Q3/2022 over the comparable
quarter.
- Revenue growth of 59% during YTD Q3/2022 over the comparable
period.
TORONTO, Nov. 24,
2022 /CNW/ - Eddy Smart Home Solutions Ltd. (formerly
Aumento Capital VIII Corp.) ("Eddy" or the "Company") (TSXV: EDY)
released its unaudited financial statements for the three and nine
months ended September 30, 2022.
GROWTH IN CONTRACTED REVENUE
Contracted revenue is the primarily measure of traction we are
gaining in the market for our leak protection services. As a
result of the new construction development cycle, in most cases,
business garnered during the quarter will translate into revenue
generation once building construction commences (ranging from a few
quarters to approximately two years). As a result, a key
operating metric of our success and the value of the business can
be measured by both the existing contracted revenue and the growth
of this figure. With a mission to protect property and empower
people with data and control, the Company's contracted sales
backlog continues to grow, which during the nine months ended
September 30, 2022, increased by
$17.4 million and stands at
$33.9 million, and represents the
future contracted revenue. The Company earns revenue over the term
of its contracts on a straight-line basis which commences upon
installation. The term of the contracts are typically 84
months.
The Company's future contracted water monitoring revenue as at
September 30, 2022 was $33.9 million (December
31, 2021 – $16.5 million),
which an increase of approximately 105% and demonstrates
significant sales momentum.
SENIOR MANAGEMENT CHANGES
On August 21, 2022, Mark Silver (Executive Chairman and Director),
took on the role of Chief Executive Officer, as a result of the
resignation by Travis Allan (former
CEO and Director). Mr. Silver has over 36 years of experience
in business, real estate and building services. As a focused
and successful entrepreneur, he previously co-founded Direct Energy
and grew revenues to more than $1.3
billion before selling in 2000. He subsequently launched
Universal Energy (purchased by Just Energy for $425 million) and National Home Services
(purchased by Reliance Comfort for $505
million). Mr. Silver launched Eddy in 2014 with a goal to
extend smart home service offerings to water protection and expand
into other markets – such as building and commercial
verticals.
On August 21, 2022, Sajid Khan was appointed as President &
Chief Operating Officer. Mr. Khan has served in the role of Chief
Operating Officer of Eddy since inception. His experience includes
more than 20 years of leadership and operational experience in the
home services sector. Mr. Khan has held various roles
including Chief Operating Officer of Eco Energy Service, Vice
President of Operations at both National Home Services and
Universal Energy, as well as management positions in Direct Energy.
He has extensive experience building and leading installation
networks and teams and other operational departments such as call
centres, billing, processing, and change management.
The change in roles strengthens the overall senior management
team and positions the Company for continued growth and maximize
value creation from its rapidly expanding backlog of contracted
revenue.
REVENUE
Revenue for the three months ended September 30, 2022, increased by $373,230 to $653,545 as compared with $280,315 reported for the comparable quarter in
2021.
Revenue for the nine months ended September 30, 2022, increased by $573,751 to $1,542,396 as compared with to $968,645 reported for the comparable period in
2021.
NET LOSS
Net loss for the three months ended September 30, 2022, was ($2,585,849), as compared to ($3,215,622) reported for the comparable quarter
in 2021.
Net loss for the nine months ended September 30, 2022, was ($8,342,088), excluding the non-recurring,
non-cash reverse takeover listing expense which amounted to
$858,118, the adjusted net loss for
the nine months ended September 30,
2022, was ($7,483,970), as
compared to ($6,150,031) reported for
the comparable period.
BASIC AND DILUTED LOSS PER
SHARE
Basic and diluted loss per share for the three months ended
September 30, 2022 was ($0.03), as compared to ($0.05) reported for the comparable quarter in
2021.
Basic and diluted loss per share for the nine months ended
September 30, 2022 was ($0.12), as compared to ($0.10) reported in the comparable
period.
UPDATE ON THE RESTATEMENT OF THE
FINANCIAL STATEMENTS
On August 19, 2022, the Company
announced the intentions to restate its financial statements and
MD&A, related to the interpretation and application of certain
technical accounting standards related to non-cash consideration
provided to a developer and customer (the "Developer") through an
amended exclusive supplier agreement dated December 15, 2021 (the "Addendum"), which upon
further analysis the estimate amount has been revised.
For the year ended December 31,
2021, the impact was isolated to the consolidated statement
of financial position, increasing prepaid expenses and contributed
surplus by approximately $944K
(initially estimated at $1.6
million). For the three months ended March 31, 2022, the impact to prepaid expenses
was slightly less than the December 31,
2021 impact, with a further impact of a reduction to general
and administrative expenses and deficit of approximately
$1.55 million, along with immaterial
adjustments to contributed surplus and revenue.
This restatement had no impact on cash flows and business
operations.
On September 30, 2022, the Company
filed its restated financial statements and the corresponding
management discussion and analysis on SEDAR.
STOCK OPTION
PLAN
The Company's amended and restated stock option plan (the
"Plan") was approved by shareholders of the Company at its annual
and special shareholders' meeting held on July 26, 2022 (the "Meeting"). Amendments made to
the Plan are outlined in the information circular in respect of the
Meeting, dated June 24, 2022, which
is available under the Company's SEDAR profile at
www.sedar.com.
SUBSEQUENT EVENT
On October 17, 2022, the Company
entered into a loan agreement with an arm's length private lender
(the "Lender") for a $1,500,000
million revolving credit facility (the "Facility").
This Facility bears interest at a rate of 8% (increasing to 14%
upon any default) per annum and will mature in two years. The
Company has also agreed to enter into security agreements (which
are subject to TSX Venture Exchange approval) providing for a first
charge security against its assets for the Facility. There were no
fees paid in connection with the Facility. The Company intends to
use the net proceeds from the Financing largely for working capital
purposes, to deploy its contracted revenue backlog and general
corporate expenses. The company made a draw in the amount of
$750,000 on this credit facility.
ABOUT EDDY
Eddy is a North American provider and developer of residential
and commercial smart water metering products and monitoring
services, helping property owners protect, control, and conserve
water usage by combining water sensing devices with behavioural
learning software. For more detail on the Company's products or
corporate information please visit www.eddysolutions.com.
For further information on the financial results of the Company,
please review the Company's unaudited condensed consolidated
interim financial statements and management's discussion and
analysis of the financial condition and results of operations for
the three and nine months ended September
30, 2022, available on Eddy's SEDAR website at
www.sedar.com. In addition, supplemental information is
available on the Eddy's website at
www.eddysolutions.com/investors.
FORWARD-LOOKING INFORMATION AND STATEMENTS
This news release contains forward-looking statements within the
meaning of applicable securities laws including, among others,
statements concerning our objectives, our strategies to achieve
those objectives, our performance, as well as statements with
respect to management's beliefs, estimates, and intentions, and
similar statements concerning anticipated future events, results,
circumstances, performance, or expectations that are not historical
facts. Forward-looking statements generally can be identified by
the use of forward-looking terminology such as "outlook",
"objective", "may", "will", "expect", "intent", "estimate",
"anticipate", "believe", "should", "plans", or "continue", or
similar expressions suggesting future outcomes or events. Such
forward-looking statements reflect management's current beliefs and
are based on information currently available to management. Forward
looking information in this news release includes information
regarding additional future contracted revenue, the Company's
leadership position in intelligent water management and leak
protection and the expectation of future sales momentum. These
statements are not guarantees of future performance and are based
on our estimates and assumptions that are subject to risks and
uncertainties, including those described under the heading "Risk
Factors" in the Company's filing statement dated January 6, 2022 "(a copy of which can be obtained
at www.sedar.com), which could cause our actual results and
performance to differ materially from the forward-looking
statements contained in this news release.
All forward-looking statements in this news release are
qualified by these cautionary statements. Except as required by
applicable law, the Company undertakes no obligation to publicly
update or revise any forward-looking statement, whether as a result
of new information, future events, or otherwise.
Neither 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.
SOURCE Eddy Smart Home Solutions Ltd.