WeCommerce Holdings Ltd. (“WeCommerce” or the
“Company”) (TSXV:WE), a leading provider of ecommerce
enablement software and tools for merchants, today announced its
financial results for the three- and twelve-month periods ended
December 31, 2021 (“Q4 2021” and “Fiscal 2021” respectively).
Currency amounts are expressed in Canadian dollars unless otherwise
noted.
Q4 2021 and Fiscal 2021 Financial
Results:
For the three-months ended
December 31,
For the year ended ended
December 31,
2021
2020
2021
2020
Revenue
Recurring subscription revenue
7,346,415
2,232,030
22,383,829
6,887,246
Digital goods revenue
3,953,600
2,304,446
10,977,020
8,973,746
Agency service revenue
949,041
1,608,792
5,220,528
5,420,507
12,249,056
6,145,268
38,581,377
21,281,499
Operating loss
(753,899)
(3,410,817)
(1,905,841)
(1,386,370)
Net income/(loss)
4,126,028
(5,469,103)
(842,922)
(4,416,476)
EBITDA(1)
8,240,074
(4,200,197)
12,594,526
17,902
EBITDA %(1)
67%
(68%)
33%
0.1%
Adjusted EBITDA(1)
3,490,740
1,706,264
11,586,037
6,340,058
Adjusted EBITDA %(1)
28%
28%
30%
30%
Cash provided by operating
activities
3,652,074
869,071
8,001,967
5,662,895
Notes:
1. See “Non-IFRS financial measures” for
further information.
Q4 2021 Highlights
- Revenue in Q4 2021 was $12,249,056, an increase of $6,103,788
or 99% (106% on a constant currency basis(1)) compared to Q4
2020.
- Apps segment revenue in Q4 2021 was $7,346,415, an increase of
$5,114,385 or 229% (240% on a constant currency basis) compared to
Q4 2020. Apps segment revenue includes the results of Stamped,
which contributed revenues of $5,010,982 in Q4 2021. Foursixty
contributed revenues of $1,236,586, an increase of $181,378 or 17%
(21% on a constant currency basis) compared to Q4 2020.
- Themes segment revenue in Q4 2021 was $3,953,600, an increase
of $1,649,154 or 72% (77% on a constant currency basis) compared to
Q4 2020. Archetype contributed revenues of $2,328,653 in Q4
2021.
- Agency segment revenue in Q4 2021 was $949,041, a decrease of
$659,751 or 41% (40% on a constant currency basis) compared to Q4
2020.
- Net income was $4,126,028 in Q4 2021 compared to net loss of
$5,469,103 in Q4 2020. The net income for Q4 2021 includes fair
value adjustments amounting to $5,302,617 which relate to the
revaluation of contingent consideration payable as part of the
acquisition of Stamped, Foursixty and Archetype. The net loss for
Q4 2020 includes a listing expense of $1,634,081, relating to the
reverse takeover completed during the quarter.
- Unrestricted cash on hand at December 31, 2021 was $26,122,247
compared to $61,193,367 on December 31, 2020. Total debt
outstanding at December 31, 2021 was $60,203,418 compared to
$10,572,500 on December 31, 2020.
- Adjusted EBITDA for Q4 2021 amounted to $3,490,740 or 28% of
revenue, compared to $1,706,264 or 28% of revenue in Q4 2020.
Fiscal 2021 Highlights
- Revenue in Fiscal 2021 was $38,581,377, an increase of
$17,299,878 or 81% (92% on a constant currency basis(1)) compared
to Fiscal 2020.
- Apps segment revenue in Fiscal 2021 was $22,383,829, an
increase of $15,496,583 or 225% (247% on a constant currency basis)
compared to Fiscal 2020. Apps segment revenue includes the results
of Stamped, which contributed revenues of $13,320,214 in Fiscal
2021. The remaining increase can be attributed to the attrition of
the acquisition of Foursixty in 2020, with the inclusion of a full
year’s worth of revenue in 2021 compared to six months in
2020.
- Themes segment revenue in Fiscal 2021 was $10,977,020 an
increase of $2,003,274 or 22% (29% on a constant currency basis)
compared to Q4 2020. The increase is attributable to the
acquisition of Archetype Themes, which contributed $3,493,222 of
revenue in Fiscal 2021. Excluding Archetype, revenue from the
themes segment decreased by $1,489,948 or 17% (11% on a constant
currency basis).
- Agency segment revenue in Fiscal 2021 was $5,220,528, a
decrease of $199,979 or 4% (1% on a constant currency basis) from
$5,420,507 in Fiscal 2020.
- Net loss in Fiscal 2021 was $842,922 compared to net loss of
$4,416,476 in Fiscal 2020.
- Adjusted EBITDA in Fiscal 2021 amounted to $11,586,037 or 30%
of revenue, compared to $6,340,058 or 30% of revenue in Fiscal
2020.
Management Commentary
“2021 was a transformational year for our business. Beginning
with a successful entry to the public markets at the end of 2020,
this year was highlighted by several major acquisitions, key
leadership appointments, and strong financial results that
collectively have us well positioned for the future,” said
WeCommerce CEO Alex Persson. “Through our performance in the fourth
quarter, we are entering 2022 with significant operating momentum.
Our Apps business, recently expanded through our acquisition of
leading zero-party data provider KnoCommerce, continues to generate
robust double-digit organic revenue growth. In Themes, we are also
seeing sustained growth and durable cash generation. Additionally,
while we continue to invest in our portfolio companies, we are also
actively canvassing the Shopify partner ecosystem for attractive
opportunities in an improved acquirer’s market categorized by
reasonable valuations. We have the team, capital and resources
necessary to build the leading acquirer and operator of ecommerce
enablement technology companies.”
Conference Call
Management will host a conference call and webcast today, March
29, 2022, at 5:00 pm ET (2:00 pm PT) to discuss its financial
results. Company CEO Alex Persson and CFO David Charron will host
the call, followed by a question-and-answer period.
Live Call:
https://conferencingportals.com/event/DWkvUNLo
Live Webcast:
https://event.on24.com/wcc/r/3577892/17D1BEB805F5DFECE6A725E40099BC5D
An archived webcast of the conference call will be accessible on
WeCommerce’s Investor Relations page at
http://investors.wecommerce.co.
Financial Statements
WeCommerce’s consolidated financial statements and Management’s
Discussion and Analysis (“MD&A”) for Q4 and Fiscal 2021 are
available on the Company’s website at https://www.wecommerce.co or
on SEDAR at www.sedar.com.
About WeCommerce Holdings Ltd
WeCommerce provides merchants with a suite of ecommerce software
tools to start and grow their online stores. Our family of
companies and brands includes Pixel Union, Out of the Sandbox,
KnoCommerce, Archetype, Yopify, SuppleApps, Rehash, Foursixty and
Stamped. As one of Shopify’s first partners since 2010, WeCommerce
is focused on building, acquiring, and investing in leading
technology businesses operating in the Shopify partner
ecosystem.
For more about WeCommerce, please visit www.wecommerce.co or
refer to the public disclosure documents available under
WeCommerce’s SEDAR profile on SEDAR at www.sedar.com.
Non-IFRS Financial Measures
This news release makes to reference to certain non-IFRS
measures and ratios, hereafter, referred to as “non-IFRS measures”.
These measures are not recognised measures under IFRS, and do not
have a standardized meaning prescribed by IFRS and are therefore
unlikely to be comparable to similar measures presented by other
companies. Rather, these measures are provided as additional
information to complement those IFRS measures by providing further
understanding of the results of operations from management’s
perspective. Accordingly, these measures should not be considered
in isolation nor as a substitute for analysis of the financial
information reported under IFRS. The Company uses non-IFRS measures
including “EBITDA”, “EBITDA %”, “Adjusted EBITDA”, “Adjusted EBITDA
%”, and “Constant Currency”. Management uses these non-IFRS
measures to facilitate operating performance comparisons from
period to period, to prepare annual operating budgets and forecasts
and to determine components of management compensation. As required
by Canadian securities laws, the Company defines and reconciles
these non-IFRS measures below:
EBITDA and EBITDA %
EBITDA is defined as earnings (net income or loss) before
finance costs, income taxes, depreciation and amortization. EBITDA
is reconciled to net income (loss) from the financial
statements.
EBITDA % ratio is determined by dividing EBITDA by total revenue
for the year.
EBITDA and EBITDA % is frequently used by securities analysts
and investors when comparing the Company’s results to other
companies. EBITDA and EBITDA % are measures commonly reported and
widely used as a valuation metric.
Adjusted EBITDA and Adjusted EBITDA %
Adjusted EBITDA removes unusual, non-cash or non-operating items
from EBITDA such as listing expenses, acquisition costs,
restructuring charges, asset impairments, non-cash stock-based
compensation, fair value adjustments to contingent consideration
payable and foreign exchange gains and losses. The Company believes
adjusted EBITDA provides improved continuity with respect to the
comparison of its operating performance over a period of time.
Adjusted EBITDA is reconciled to net income (loss) from the
financial statements. The definition of Adjusted EBITDA has been
updated in the current year to reflect certain specific adjustments
that had not been present in the 2020 adjustments, as these items
were unique to 2021.
Adjusted EBITDA % is determined by dividing Adjusted EBITDA by
total revenue for the year.
Adjusted EBITDA and Adjusted EBITDA % is frequently used by
securities analysts and investors when comparing the Company’s
results to those of other companies. It provides a consistent basis
to evaluate profitability and performance trends by excluding items
that the Company does not consider to be controllable activities
for this purpose. Adjusted EBITDA and EBITDA % are measures
commonly reported and widely used as a valuation metric.
Constant Currency
Constant currency is determined by applying the same foreign
currency exchange rates to the financial results of the current and
equivalent prior-year period. The Company’s reporting currency is
the Canadian dollar but we conduct business in Canadian, U.S. and
Singapore dollars. The Company measures its performance before the
impact of foreign currency. Constant currency is reconciled to
revenue from the financial statements.
The Company believes Constant Currency allows for current
financial performance to be understood against comparative periods
without the impact of fluctuations in foreign exchange rates
against the Canadian dollar.
Non-IFRS Measures Reconciliations
EBITDA and Adjusted EBITDA
For the three-months ended
December 31,
2021
2020
Net income/(loss)
4,126,028
(5,469,103)
Income tax expense
183,071
99,991
Depreciation and amortization
3,295,125
953,935
Finance costs
635,850
214,980
EBITDA
8,240,074
(4,200,197)
EBITDA %
67%
(68%)
EBITDA adjustments
Stock-based compensation
917,702
4,035,091
Foreign exchange (gain)/loss
(396,232)
109,234
Acquisition costs
30,616
70,366
Listing expense
-
1,634,081
Fair value adjustments of contingent
consideration
(5,302,617)
-
Non-recurring professional fees
-
20,189
Severance costs
-
37,500
Loss on disposal of assets
1,197
-
Adjusted EBITDA
3,490,740
1,706,264
Adjusted EBITDA %
28%
28%
For the years ended December
31,
2021
2020
Net loss
(842,922)
(4,416,476)
Income tax expense
298,022
423,854
Depreciation and amortization
10,087,571
3,184,607
Finance costs
3,051,855
825,917
EBITDA
12,594,526
17,902
EBITDA %
33%
0.1%
EBITDA adjustments
Stock-based compensation
1,890,466
4,169,265
Foreign exchange (gain)/loss
1,010,460
146,254
Acquisition costs
1,461,844
170,659
Listing expense
-
1,634,081
Fair value adjustments of contingent
consideration
(5,302,617)
-
Non-recurring professional fees
91,560
73,588
Severance costs
26,767
128,309
(Gain) on sale of themes
(355,513)
-
Loss on disposal of assets
168,544
-
Adjusted EBITDA
11,586,037
6,340,058
Adjusted EBITDA %
30%
30%
EBITDA % and Adjusted EBITDA %
For the three-months ended
December 31,
2021
2020
EBITDA
8,240,074
(4,200,197)
Revenue
12,249,056
6,145,268
EBITDA %
67%
(68%)
Adjusted EBITDA
3,490,740
1,706,264
Revenue
12,249,056
6,145,268
Adjusted EBITDA %
28%
28%
For the years ended December
31,
2021
2020
EBITDA
12,594,526
17,902
Revenue
38,581,377
21,281,499
EBITDA %
33%
0.1%
Adjusted EBITDA
11,586,037
6,340,058
Revenue
38,581,377
21,281,499
Adjusted EBITDA %
30%
30%
Constant Currency
For the three-months ended
December 31,
% Change
2021
2020
As reported
Foreign exchange impact
Constant currency
Revenue
Recurring subscription revenue
7,346,415
2,232,030
229%
11%
240%
Digital goods revenue
3,953,600
2,304,446
72%
5%
77%
Agency service revenue
949,041
1,608,792
(41%)
1%
(40%)
12,249,056
6,145,268
99%
7%
106%
For the years ended December
31,
% Change
2021
2020
As reported
Foreign exchange impact
Constant currency
Revenue
Recurring subscription revenue
22,383,829
6,887,246
225%
22%
247%
Digital goods revenue
10,977,020
8,973,746
22%
7%
29%
Agency service revenue
5,220,528
5,420,507
(4%)
3%
(1%)
38,581,377
21,281,499
81%
11%
92%
Forward-Looking Information
This news release contains certain forward-looking statements
and forward-looking information within the meaning of applicable
securities law. Such forward-looking statements and information
include, but are not limited to, statements or information with
respect to: the Company’s future business and strategies;
requirements for additional capital and future financing; estimated
future working capital, funds available, uses of funds, future
capital expenditures and other expenses for specific operations and
intellectual property protection; industry demand; ability to
attract and retain employees, consultants or advisors with
specialized skills and knowledge; anticipated joint development
programs; incurrence of costs; competitive conditions; general
economic conditions; and scalability of developed technology.
Forward-looking statements and information are frequently
characterized by words such as “plan”, “project”, “intend”,
“believe”, “anticipate”, “estimate” and other similar words, or
statements that certain events or conditions “may” or “will” occur.
Although the Company’s management believes that the assumptions
made and the expectations represented by such statement or
information are reasonable, there can be no assurance that a
forward-looking statement or information referenced herein will
prove to be accurate. Forward-looking statements are based on the
opinions and estimates of management at the date the statements are
made and are subject to a variety of risks and uncertainties and
other factors that could cause actual events or results to differ
materially from those anticipated in the forward-looking
statements. Factors that could cause actual results to differ
materially from those in forward-looking statements include risks
relating to reliance on the Shopify platform; the Company’s limited
operating history; reliance on management and key employees;
conflicts of interest in relation to the Company’s officers,
directors, and consultants; additional financing requirements;
resale of Common Shares in the publicly-traded market; market price
fluctuations for the Common Shares; global financial conditions;
management of growth; risks associated with the Company’s strategy
of growth through acquisitions; tax risks; currency fluctuations;
competitive markets; uncertainty and adverse changes in the
economy; unsustainability of the Company’s rapid growth and
inability to attract new customers, retain revenue from existing
merchants, and increase sales to both new and existing customers;
adverse effects on the Company’s revenue growth and profitability
due to the inability to attract new customers or sell additional
products to existing customers; future results of operations being
harmed due to declines in recurring revenue or contracts not being
renewed; security and privacy breaches; changes in client demand;
challenges to the protection of intellectual property; infringement
of intellectual property; ineffective operations through mobile
devices, which are increasingly being used to conduct commerce; and
risks associated with internal controls over financial reporting.
The Company undertakes no obligation to update forward-looking
statements and information if circumstances or management’s
estimates should change except as required by law. The reader is
cautioned not to place undue reliance on forward-looking statements
and information. More detailed information about potential factors
that could affect results is included in the documents that may be
filed from time to time with the Canadian securities regulatory
authorities by the Company.
For a more detailed discussion of certain of these risk factors,
see the Company's most recent MD&A described in the “Risk
Factors” as well as the list of risk factors in the Company’s
Annual Information Form available on SEDAR at www.sedar.com
under the Company’s profile.
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES
PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX
VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR
ACCURACY OF THIS RELEASE.
SOURCE: WECOMMERCE HOLDINGS LTD.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220329005962/en/
Company Contact: David Charron Chief Financial Officer
Phone: 416-418-3881 Email: david@wecommerce.co Investor
Relations: Tom Colton Gateway Investor Relations Phone:
949-574-3860 Email: WE@gatewayir.com
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