- Total revenues grew 383% to C$11.6
million in the first six months of 2020 compared to
C$2.4 million in the same period for
2019
- Q2 2020 total revenues increased 144% to C$5.0 million compared to C$2.05 million in Q2 2019
- 2,675 new connected assets were added to reach a new high of
51,347 in Q2 2020, a year-over-year increase of 52%
- AssetCare™ over time revenues increased 440% to
C$2.7 million in Q2 2020 compared to
C$0.5 million in Q2 2019, boosted by
the higher monthly recurring revenues of oil and gas connected
assets
VANCOUVER, BC, Aug. 13, 2020 /CNW/ - mCloud Technologies
Corp. (TSXV: MCLD) (OTCQB: MCLDF) ("mCloud" or the
"Company"), a leading provider of asset management solutions
combining IoT, cloud computing, and artificial intelligence ("AI"),
today announced its financial results for the second quarter ended
June 30, 2020 ("Q2 2020").
"Our over 51,000 connected assets generated recurring revenue
that buoyed results for the quarter, a clear message that our focus
on adding new connected assets to our AssetCare platform is
paying off," said Russ McMeekin,
mCloud President and CEO. "Despite the challenges presented by
strict lockdowns across the board, we are encouraged by the growing
demand for remotely connecting assets across all of our business
segments, and particularly our higher revenue-per-asset oil and gas
customers."
"Throughout July and early August, we have seen businesses
cautiously return to work while we have incrementally added new
connected assets," McMeekin continued. "As a result, we continue to
have a line of sight to achieving our goal of connecting 70,000
assets by end of year."
"Deferrals in our technical project services business, a result
of limited customer access, and back-end loading of new connections
make it unlikely we will achieve our previously projected
C$70 million in revenue for the full
year," McMeekin added. "Nevertheless, achieving our goal of
connecting 70,000 assets by year-end supports the run rate in
AssetCare revenues we were anticipating heading into 2021."
"Until we are able to onboard and deliver to customers on a
regular basis, it will be difficult to accurately forecast
revenues, though we will be able to provide regular updates on the
addition of new connected assets as our primary measure of growth,"
McMeekin concluded. "The new normal for most of our customers has
revealed opportunities that are well suited to AssetCare and
therefore we continue to be optimistic that our AssetCare platform
will drive recurring revenue growth, achieve robust gross margins,
generate sustainable positive cash flow for the business, and
ultimately create value for all stakeholders."
Comparing 2020 vs 2019 Revenues
(All figures are
in Canadian dollars)
|
|
|
|
|
Three Months Ended
June 30
|
Six Months Ended
June 30
|
|
2020
|
2019
|
2020
|
2019
|
AssetCare
initialization
|
$
|
1,352,021
|
$
|
1,499,656
|
$
|
3,424,874
|
$
|
1,610,630
|
AssetCare over
time
|
2,683,670
|
548,614
|
3,676,215
|
765,297
|
Engineering
services
|
974,391
|
--
|
4,467,197
|
--
|
Total
|
$
|
5,010,082
|
$
|
2,048,270
|
$
|
11,568,286
|
$
|
2,375,927
|
Total revenues for Q2 2020 were C$5.0
million compared to C$2.05
million for the same period in 2019, a 144% increase
year-over-year. On a six-month basis, revenues grew 383% to
C$11.6 million in the first half of
2020 compared to C$2.4 million for
the same period in 2019.
AssetCare over time revenues reached C$2.7 million in Q2 2020, a 170% increase from
C$1.0 million in Q1 2020 and a
440% increase over the same period in 2019. The Company's connected
asset count increased by 2,675 in Q2 2020 to 51,347 total connected
assets.
In Q2 2020, revenues from newly initialized assets in the
quarter were C$1.4 million. The
Company noted fewer new connected assets in Q2 2020 compared to Q1
2020 as a result of the restricted access to workplaces seen at
local, regional, and national levels. Though there were fewer
connected assets, many of the new connected assets in Q2 2020 came
from oil and gas customers commanding higher monthly recurring
revenues per connected asset. Revenues from technical project
services in Western Canada were
C$974,391, impacted by access to
customer sites in the quarter.
Comparing 2020 vs 2019 Adjusted EBITDA
Note: Adjusted EBITDA
is the net income or loss excluding certain expenses incurred for
various M&A, acquisition integration financings, and other
capital markets efforts. See "Non-GAAP Measure"
below.
|
|
|
|
(All figures are
in Canadian dollars)
|
|
|
|
|
|
|
1H
2020
|
1H
2019
|
Revenue
|
11,568,286
|
2,375,927
|
Cost of
sales
|
4,432,415
|
681,098
|
Gross
profit
|
7,135,871
|
1,694,829
|
Operating
Expenses
|
23,429,808
|
7,878,898
|
Net loss for the
period
|
(17,230,663)
|
(5,188,570)
|
Add: Current tax
expense
|
(71,549)
|
34,228
|
Less: Deferred income
recovery
|
(959,044)
|
(1,376,370)
|
Less: Other
income
|
(980,231)
|
-
|
Add: Depreciation and
amortization
|
3,181,154
|
995,597
|
Add: Share-based
compensation
|
689,640
|
545,351
|
Add: Finance
costs
|
2,833,288
|
170,371
|
Less: Finance
income
|
(12,436)
|
(164,523)
|
Add: Foreign exchange
loss
|
(897,598)
|
164,607
|
Add: Business
acquisition costs and other expenses
|
1,024,296
|
176,188
|
Add: Salaries, wages,
and benefits
|
4,449,154
|
1,216,985
|
Add: Professional and
consulting fees
|
3,672,471
|
1,691,831
|
Adjusted
EBITDA
|
(4,301,518)
|
(1,734,305)
|
On July 6, 2020, the Company
announced it had closed a C$11.5
million public offering in part to finance the acquisition
of kanepi Group Pty Ltd ("kanepi"), an oil and gas visualization
and analytics provider based in Australia and Singapore, which is expected to expand
mCloud's footprint in Southeast
Asia, West Africa, and
South America, bringing major oil
and gas, FPSO, LNG, and mining customers to mCloud. mCloud and
kanepi are working closely with counsel and the Australian Foreign
Investment Review Board to finalize this transaction.
On July 16, 2020, the Company
announced it had closed a C$4 million
non-brokered unit offering on amended terms.
As previously announced on May 19,
2020, mCloud partnered with SecureAire LLC to combine air
filtration with mCloud's AI to optimize the health and safety of
indoor air in commercial buildings, employing technologies
implemented in leading healthcare facilities across the United States and independently verified
in published scientific research. The Company introduced new AI
capabilities to AssetCare using air quality sensors and HVAC
connectivity to optimize building ventilation and ensure compliance
with CDC, ASHRAE, and guidance from local health authorities while
improving building energy efficiency under post-pandemic operating
conditions.
Also announced on June 24, 2020,
mCloud partnered with nybl, an oil and gas technology provider in
the Middle East, to deliver asset
optimization solutions for artificial lift assets such as electric
submersible pumps and plunger lifts for oil wells in oil and gas
centers worldwide. Combining nybl's AI technology with AssetCare,
the Company began efforts to connect the first set of 2,000 oil
wells in Kuwait and North America.
Q2 2020 Earnings Conference Call
The Company is hosting a conference call to discuss the
financial results for the second quarter at 5:30 p.m. ET today. The conference call will
include prepared remarks from Russ
McMeekin, Chief Executive Officer, and Chantal Schutz, Chief Financial Officer. After
the prepared remarks, the Company will accept questions.
To access the conference call by telephone, dial 647-427-7450 or
1-888-231-8191. Please connect approximately 10 minutes prior to
the beginning of the call to ensure participation. The conference
call will be archived for replay by telephone until Thursday, August 20, 2020 at midnight (ET). To
access the archived conference call, dial 1-855-859-2056 and enter
the reservation number 1085971.
A live audio webcast of the conference call will be available at
https://bit.ly/2XfeHUg. Please connect at least 15 minutes prior to
the conference call to ensure adequate time for any software
download that may be required to join the webcast. The
webcast will be archived at the above website for one year.
About mCloud Technologies Corp.
mCloud is creating a more efficient future with the use of AI
and analytics, curbing energy waste, maximizing energy production,
and getting the most out of critical energy infrastructure. Through
mCloud's AI-powered AssetCare™ platform, mCloud offers complete
asset management solutions in five distinct segments: commercial
buildings, renewable energy, healthcare, heavy industry, and
connected workers. IoT sensors bring data from connected assets
into the cloud, where AI and analytics are applied to maximize
their performance.
Headquartered in Vancouver,
Canada with offices in twelve locations worldwide, the
mCloud family includes an ecosystem of operating subsidiaries that
deliver high-performance IoT, AI, 3D, and mobile capabilities to
customers, all integrated into AssetCare. With over 100 blue-chip
customers and more than 51,000 assets connected in thousands of
locations worldwide, mCloud is changing the way energy assets are
managed.
mCloud's common shares trade on the TSX Venture Exchange under
the symbol MCLD and on the OTCQB under the symbol MCLDF. mCloud's
convertible debentures trade on the TSX Venture Exchange under the
symbol MCLD.DB. For more information, visit www.mcloudcorp.com.
Non-GAAP Measure
Selected financial information for the three-month period ended
June 30, 2020 set out above includes
reference to "Adjusted EBITDA", which is not recognized under
International Financial Reporting Standards and is a non-generally
accepted accounting principle ("Non-GAAP") measure. This
information should be read in conjunction with the unaudited
interim consolidated financial statements for the three months
ended June 30, 2020 and audited
consolidated financial statements and notes thereto for the year
ended December 31, 2019 along with
mCloud's MD&As for the corresponding periods, which are
available under mCloud's profile on SEDAR at www.sedar.com. Further
information regarding this Non-GAAP measure is contained in
mCloud's annual MD&A for the period ended December 31, 2019.
Forward-Looking Information and Statements
This press release contains certain "forward-looking
information" within the meaning of applicable Canadian securities
legislation and may also contain statements that may constitute
"forward-looking statements" within the meaning of the safe harbor
provisions of the U.S. Private Securities Litigation Reform Act of
1995. Such forward-looking information and forward-looking
statements are not representative of historical facts or
information or current condition, but instead represent only the
Company's beliefs regarding future events, plans or objectives,
many of which, by their nature, are inherently uncertain and
outside of the Company's control. Generally, such forward-looking
information or forward-looking statements can be identified by the
use of forward-looking terminology such as "plans", "expects" or
"does not expect", "is expected", "budget", "scheduled",
"estimates", "forecasts", "intends", "anticipates" or "does not
anticipate", or "believes", or variations of such words and phrases
or may contain statements that certain actions, events or results
"may", "could", "would", "might" or "will be taken", "will
continue", "will occur" or "will be achieved". The forward-looking
information contained herein may include information related to
expected revenues and growth in AssetCare connections, the
partnership with nybl for the connection of oil wells in
Kuwait and North America, and the expected completion of
the Company's acquisition of kanepi.
By identifying such information and statements in this manner,
the Company is alerting the reader that such information and
statements are subject to known and unknown risks, uncertainties
and other factors that may cause the actual results, level of
activity, performance or achievements of the Company to be
materially different from those expressed or implied by such
information and statements.
An investment in securities of the Company is speculative and
subject to several risks as discussed under the heading "Risk
Factors" on pages 29 to 46 of the Company's filing statement dated
October 5, 2017. Although the Company
has attempted to identify important factors that could cause actual
results to differ materially from those contained in the
forward-looking information and forward-looking statements, there
may be other factors that cause results not to be as anticipated,
estimated or intended.
In connection with the forward-looking information and
forward-looking statements contained in this press release, the
Company has made certain assumptions. Although the Company believes
that the assumptions and factors used in preparing, and the
expectations contained in, the forward-looking information and
statements are reasonable, undue reliance should not be placed on
such information and statements, and no assurance or guarantee can
be given that such forward-looking information and statements will
prove to be accurate, as actual results and future events could
differ materially from those anticipated in such information and
statements. The forward-looking information and forward-looking
statements contained in this press release are made as of the date
of this press release, and the Company does not undertake to update
any forward-looking information and/or forward-looking statements
that are contained or referenced herein, except in accordance with
applicable securities laws. All subsequent written and oral
forward- looking information and statements attributable to the
Company or persons acting on its behalf is expressly qualified in
its entirety by this notice.
Neither 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 mCloud Technologies Corp.