Achieves a 31% increase in Revenue and 25%
increase in Annual Recurring Revenue
VANCOUVER, Aug. 28, 2018 /CNW/ - MediaValet Inc. (TSX-V:MVP)
(the Company), a leading provider of enterprise cloud‐based digital
asset management ("DAM") software, is pleased to report its results
for the three and six months ended June 30,
2018.
Summary of Quarterly Results
|
|
3 months
ended June
30, 2018
|
3 months
ended June
30, 2017
|
6 months
ended June
30, 2018
|
6 months
ended June
30, 2017(1)
|
Revenue
|
$
|
696,420
|
$
|
533,275
|
$
|
1,311,463
|
$
|
999,233
|
|
% Increase from
prior year period
|
31%
|
57%
|
31%
|
68%
|
Gross
Margin
|
529,154
|
443,995
|
1,020,627
|
827,093
|
|
Gross Margin
%
|
76%
|
83%
|
78%
|
83%
|
Cost of Revenue +
Operating Expenses(2)
|
1,742,328
|
1,644,105
|
3,233,705
|
3,231,398
|
|
% Increase from
prior year period
|
6%
|
8%
|
(0%)
|
6%
|
EBITDA
Loss(3)
|
(1,045,908)
|
(1,110,830)
|
(1,922,242)
|
(2,232,165)
|
|
% Decrease from
prior year period
|
(6%)
|
(7%)
|
(14%)
|
(10%)
|
Net
loss
|
(1,176,631)
|
(1,423,712)
|
(2,291,177)
|
(2,800,911)
|
Loss per
share
|
(0.01)
|
(0.02)
|
(0.01)
|
(0.03)
|
|
|
|
As at
June
30,
2018
|
As at
December 31,
2017
|
Annual Recurring
Revenue ("ARR")(4)
|
|
|
$
|
2,867,630
|
$
|
2,488,494
|
|
% Increase from
prior year period
|
|
|
25%
|
38%
|
Working Capital
(Net of debt and deferred revenue)
|
|
|
870,496
|
$
|
(
1,703,442)
|
Deferred
Revenue
|
|
|
1,501,396
|
$
|
1,478,285
|
Total
assets
|
|
|
2,287,898
|
$
|
591,990
|
Total
Debt
|
|
|
3,000,000
|
$
|
6,180,250
|
Shareholder
(Deficiency)
|
|
|
$
|
(3,209,515)
|
$
|
(
9,321,028)
|
"Q2 was another solid quarter for MediaValet," commented
David MacLaren, CEO of MediaValet.
"We grew revenue by 31%, improved EBITDA by 6% over Q2 last year,
and were able to begin investing in our sales and marketing
campaigns. Combined with the success of our channel program, our
increased sales and marketing activities have us entering our third
quarter with the largest and strongest pipeline of qualified
opportunities to date."
Mr. MacLaren continued, "Our infrastructure and product
achievements this quarter have increased our competitive advantage
and directly improved our win rate. Our mission, as always, is to
build an industry leading solution to the challenges marketing
teams face as they execute their go-to-market strategies. This
mission was expanded with the launch of Creative Spaces in
May 2018, which adds creative teams
and operations to our target market opportunity. We believe this is
a one-two punch to win more market share. We're confident our
Advanced Core DAM (V4) + Creative Spaces + Unlimited Support,
Training and Users are a winning combination – a belief that is
supported by the robustness of our sales pipeline."
Results of Operations
Key Financial Metrics:
- Grew second quarter revenue to $0.70
million, up 31% from $0.53
million in Q2 2017, and up 13% sequentially from Q1 2018.
For the year-to-date ("YTD") period, revenue of $1.31 million was up 31% from $1.0 million in 1H 2017. Over 90% of revenue is
recurring from annual Software-as-a-Service (SaaS) agreements. The
increases in revenue reflect the growth in the annual recurring
revenue base as the Company continues to win new customers, expand
its markets, and retain existing customers.
- Achieved 1H 2018 Gross Margin of 78%, down from 83% last YTD.
The high Gross Margin levels is consistent with the SaaS business
model and reflects increasing sales volume, improving operating
efficiencies, and adoption of new paid feature add-ons. The decline
in 1H 2018 compared to the prior year is mostly due to duplicative
data center costs being incurred during migration from the
Company's V3 to V4 platform. In addition, the release of V4 and
several new high powered features, has increased customer usage of
the system. Management believes this to be a positive development
for long term customer retention and expansion.
- Incurred Operating Expenses of $1.55
million for Q2 2018, a 1% (restated 5%) increase from
$1.55 million in Q2 last year, and a
15% sequential increase from Q1 2018. YTD Operating Expenses were
$2.94 million, a decrease of 4% from
1H 2017 (restated 0%). The Q2 increases are due to increased sales
and marketing spend following the equity financing completed in
February 2018. Note that restated
percentages are provided throughout this document where applicable
to provide the change from prior periods had IFRS 15 been applied
with retroactive restatement.
- Reported a Q2 2018 EBITDA loss of $1.05
million, a 6% (restated 0%) reduction from a EBITDA loss of
$1.11 million in Q2 2017 and a 19%
sequential increase from Q1 2018. For the YTD period, the EBITDA
loss was $1.92 million, down 14%
(restated 9%) from $2.23 million last
YTD. The reduced losses compared to last year reflect continued
revenue growth as a result of the Company's growing recurring
revenue base and efforts to balance operating costs and funding
levels. The sequential increase in Q2 is primarily due to increased
sales and marketing expenses following the equity financing in
February 2018.
- Increased Annual Recurring Revenue ("ARR") to $2.87 million, an increase of 25% compared to
$2.30 million at June 30, 2017, and a 9% sequential increase from
Q1 2018. The increase in ARR is a result of efforts to maintain and
grow our customer base through continuing to deliver on our
go-to-market strategy.
- Ended the quarter with $0.84
million of cash on hand (December 31,
2017 - $0.04 million), working
capital of $0.87 million
(December 31, 2017 – negative
$1.70 million) and debt of
$3.00 million (December 31, 2017 - $6.18
million).
Technology and Product:
- In June 2018, announced
that Gartner, Inc. (NYSE:IT) (Gartner) named MediaValet in its 2018
Market Guide for Digital Asset Management, as one of nineteen
Representative Vendors covering on-premises, cloud, hybrid and SaaS
deployments. MediaValet was positioned as one of the most
enterprise-grade, globally available DAM systems on the
market.
- In May 2018, launched a
number of technology and product milestones which management
believes will materially increase the value delivered to customers,
enable us to attract more new customers and increase existing
customer retention and expansion. These developments increase the
enterprise class capability of the system – including providing
unparalleled speed and search features – and provide unique
integrations and features that solve critical customer issues and
provide differentiation to MediaValet. The milestones include:
-
- Launch of MediaValet V4 which included new features such
as Advanced Search, Multi-Libraries, and Interactive User Success
Guides. V4 in particular was an 18 month project and is a major
platform upgrade that removes all legacy technical debt and
dramatically increases system performance. Advanced Search
leverages artificial intelligence to enable customers to search for
assets based on system discovered asset characteristics.
Multi-Library supports the enterprise need for parent-child
structures for independent multi-divisional organizations.
- Introduction of Creative Spaces, an innovative new
solution for creative teams that combines all the benefits of
working locally on a server with those of MediaValet's Cloud DAMS.
Developed with deep customer collaboration, Creative Spaces
launched with support for linking work-in-process creative assets
in the MediaValet DAM with Adobe's Creative Cloud – an essential
and previously un-solved challenge for users of any DAM
system.
- Announced integration of MediaValet with Workfront, a
leading provider of cloud-based enterprise work management
solutions, enterprise project management and workflow software.
Integrations are essential for helping customers to maximize
adoption of the DAM within their environment.
Operations and Corporate:
- Announced the DAM industry's first supply chain consortium in
May 2018, focused on leveraging
Blockchain technology to transform the DAM industry and the
future of enterprise content distribution. As a founding member,
MediaValet will help develop interoperability standards across
service providers for the adoption of new supply chain technologies
for DAM.
- Launched a new reseller channel partnership with IO
Integration ("IOI") in February
2018, a global digital asset management, marketing, and
creative operations technology solutions consultancy with a select
portfolio of marketing and creative operations technology
solutions. Building a synergistic and effective reseller channel
partner program is one of MediaValet's key growth strategies.
- In February 2018, Rob Chase expanded his role with the Company,
joining the senior management team as Executive Chairman and Chief
Financial Officer. Rob also increased his ownership position in
MediaValet to 10% as part of the February
2018 financing round.
- On February 22, 2018, announced
closing of an $8.6 million brokered
and non-brokered private placement, issuing 143,341,864 common
shares at $0.06 per share.
1 Fiscal 2017 figures have not
been restated for adoption of IFRS 9 and IFRS 15 as the changes
were applied starting in Q1 2018 on a cumulative effect basis. The
percent change for YTD to June 30, 2018 compared to restated 2017
amounts, is a 4% increase for Cost of Revenue and Operating
Expenses, and a 9% decline for EBITDA Loss. See the "Adoption of
New Account Standards" section
below.
|
|
2
Operating Expenses include Sales & Marketing, Research &
Development and General & Administrative
expenses.
|
|
3
EBITDA is a non-IFRS measure of profit and loss. Management
believes EBITDA provides a meaningful measure for assessment of
Company performance as it removes non-cash and non-operating
expenses.
|
|
4
Annual Recurring Revenue (ARR) is a non-IFRS measure of future
revenue and billings from customers as of the reporting date. ARR
represents the sum of the annual recurring revenue from existing
customer contracts or commitments as of the reporting period end
date. Management believes ARR to be a meaningful measure for
assessment of Company performance. ARR is recorded as deferred
revenue when it is invoiced and is recognized in revenue evenly
over the contract term.
|
MediaValet's full financial statements and related MD&A are
now available on SEDAR.
About MediaValet, Inc.
MediaValet stands at the forefront of the enterprise cloud-based
digital asset management industry. Built exclusively on Microsoft
Azure and available in 140 countries, 54 Microsoft data center
regions, around the world, MediaValet delivers unparalleled
enterprise class security, reliability, redundancy and scalability
while offering the largest global footprint of any DAM solution. In
addition to providing all core DAM capabilities and local
desktop-to-cloud support for creative teams, MediaValet offers
industry leading integrations into Slack, Adobe Creative Suite,
Microsoft Office 365, Oracle Marketing Cloud (Eloqua), Drupal 8,
WordPress, Hootsuite and many other best-in-class 3rd
party applications.
Follow MediaValet: Blog, Twitter and LinkedIn
Surf: www.mediavalet.com
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accuracy of this release."
SOURCE MediaValet Inc.