Achieves a 32% increase in Revenue, a 29%
increase in Annual Recurring Revenue, and a 6% reduction in
Operating Expenses
VANCOUVER, May 14, 2018 /CNW/ - MediaValet Inc. (TSX-V:MVP)
(the Company), a leading provider of cloud‐based digital asset
management ("DAM") software, is pleased to report its results for
the three months ended March 31,
2018.
Summary of Quarterly Results
|
|
|
|
3 months ended
March 31, 2018
|
3 months ended
March 31, 2017(1)
|
|
Revenue
|
$
615,043
|
$ 465,958
|
|
% Increase from
prior year period
|
32%
|
84%
|
|
Gross
Margin
|
$ 491,
473
|
$ 383,098
|
|
Gross Margin
%
|
80%
|
82%
|
|
Cost of Revenue +
Operating Expenses(2)
|
$
1,491,377
|
$
1,587,293
|
|
% Increase from
prior year period
|
(
6%)
|
4%
|
|
EBITDA
Loss(3)
|
$
(876,334)
|
(1,121,335)
|
|
% Decrease from
prior year period
|
(22%)
|
(12%)
|
|
Net
loss
|
$ (1,114,546
)
|
$
(1,377,199)
|
|
Loss per
share
|
$ (
0.01)
|
$ ( 0.02)
|
|
As at
March
31,
2018
|
As at December
31, 2017
|
|
Annual Recurring
Revenue ("ARR")(4)
|
$
2,631,817
|
$
2,488,494
|
|
% Increase from
prior year period
|
29%
|
38%
|
|
Working Capital
(Net of debt and deferred revenue)
|
$
2,088,653
|
$ (
1,703,442)
|
|
Deferred
Revenue
|
$
1,509,376
|
$
1,478,285
|
|
Total
assets
|
$
3,591,905
|
$ 591,990
|
|
Total
Debt
|
$
3,000,000
|
$
6,180,250
|
|
Shareholder
(Deficiency)
|
$ (
2,053,299)
|
$ (
9,321,028)
|
"Fiscal 2018 is off to a great start for MediaValet," said
David MacLaren, CEO of MediaValet.
"We significantly strengthened our balance sheet with a successful
financing round, grew our revenue base, resumed our go-to-market
spend on sales and marketing, and delivered on some major product
milestones. We believe this has given us a fantastic opportunity to
capitalize on the positive developments and growth trends in the
DAM market."
"Subsequent to quarter end, we announced a number of key new
features and solutions that have set us apart from the competition
and reinforced our reputation as an innovator. We have already seen
increasing interest from both new and existing customers as a
result. The speed at which MediaValet V4 can now deliver cloud DAM
is not only unparalleled by other cloud vendors, but rivals that of
expensive and complex on premise solutions. Add to this the
exciting new search capabilities leveraging artificial
intelligence, the solving of long-standing creative workflow
challenges with Creative Spaces, and an ability to innovate faster
than ever before; and I believe we are poised to significantly
increase our rate of new customer acquisition."
"At the same time, to have also solved for our funding
requirements and to have resumed investing in our go-to-market
strategy, will enable us to monetize these exciting product
launches and to accelerate our revenue growth. Our team is truly
expert in the DAM space. I am looking forward to what we can
accomplish with proper funding and a differentiated
offering."
Results of Operations
Key Financial Metrics:
- Grew first quarter revenue to $0.62
million, up 32% from $0.47
million in Q1 2017, and up 4% sequentially from Q4 2017.
Over 90% of revenue is recurring from annual Software-as-a-Service
(SaaS) agreements. The increases reflect the growth in the ARR base
as the Company continues to win and retain customers.
- Achieved Q1 2018 Gross Margin of 80%, down from 82% last year.
The high Gross Margin is consistent with the SaaS business model.
The decline is due to additional data center costs during
implementation of MediaValet V4.
- Incurred Operating Expenses of $1.37
million for Q1 2018, reducing 9% (restated 5%) from
$1.50 million last year, and
increasing 6% (restated 2%) from Q4-2017. The year-on-year
reduction reflects efforts to optimize spending levels and to
manage expenses with funding availability. The sequential increase
is due to increased sales and marketing spend following close of
the equity financing in February
2018. The restated percentages are used in this document to
provide the change from prior periods had IFRS 15 been applied with
retroactive restatement.
- Reported a Q1 2018 EBITDA loss of $0.877
million, a 22% (restated 17%) reduction from an EBITDA loss
of $1.12 million in Q1 2017 and a 6%
(restated 1%) sequential increase from Q4 2017. The reduction from
last year reflects continued revenue growth as a result of the
Company's growing ARR base and efforts to balance operating costs
with funding levels. The sequential increase is primarily due to
increased sales and marketing expenses following the equity
financing.
- Increased ARR to $2.63 million,
an increase of 29% compared to $2.03
million at March 31, 2017, and
a 6% sequential increase from Q4 2017. The increase is a result of
efforts to maintain and grow the customer base through continuing
to invest in go-to-market strategies and developing innovative
solutions to customers' DAM challenges.
- Ended the quarter with $2.53
million of cash on hand (December 31,
2017 - $0.04 million), working
capital of $2.09 million
(December 31, 2017 – negative
$1.70 million) and debt of
$3.00 million (December 31, 2017 - $6.18
million). On February 22,
2018, the Company completed an $8.6
million equity financing, which was sufficient to retire
$3.18 million of debt, pay trade
accounts payable, and to fund the Company's current operating
capital requirements.
Technology and Product:
- In May 2018, launched
MediaValet V4 including new features for advanced search,
multi-library and interactive user success guides. MediaValet
is focused on improving the DAM experience for customers, and in
turn expects this will enable MediaValet to attract, win and retain
more customers. This product launch included:
-
- MediaValet V4 – the result of 18 months of development
efforts, and leveraging Microsoft's next generation cloud
application platform, Azure Service Fabric, V4 sets new benchmarks
for application speed and platform scalability. A complete backend
code rewrite, V4 removes legacy system technical debt,
significantly reduces support requirements, dramatically increases
the performance, functionality and broad user appeal of MediaValet,
and increases the velocity at which we can innovate.
- Advanced Search – designed to provide a fast and
efficient experience for discovering assets, it is MediaValet's
first feature to leverage artificial intelligence. Customers are
now able to search using advanced filters, including colour, file
type and size, rating, number of people, status, activity, to name
a few, as well as create and "pin" Saved Searches for yourself, for
groups, and for global system use.
- Multi-Libraries – is an essential capability for
organizations needing to support multiple self-controlled user
groups (eg. divisions) that require separate taxonomies and
administration. Organizations such as ad agencies, hospital groups,
universities, global companies and conglomerates face significant
challenges maintaining master administration and governance while
providing local and departmental flexibility. Multi-Libraries
enables these organizations to create separate self-managed
libraries for each of these user groups, while still maintaining
global access and master control at the head office level.
- Interactive User Success Guides – developed to increase
organizational adoption of DAM through reducing impediments such as
training and ease-of-use challenges. Delivered as in-app,
role-based, interactive process, productivity and activity user
guides that can be fully customized to support each of an
organization's unique use cases.
- Announced Creative Spaces in May 2018, an innovative new solution for
large creative teams that combines all the benefits of working
locally with those of MediaValet's Cloud DAMS. Developed with deep
customer collaboration, this first version of Creative Spaces
provides customers' creative teams with a safe space to create
while supporting linking between their assets and Adobe's Creative
Cloud. Creative Spaces delivers the speed of working locally with
all the productivity and security benefits of their corporate DAM.
Directly from their desktop, creatives can now access their entire
corporate asset library, utilize advanced search and full screen
viewing features, synchronize their local and cloud-based assets,
as well as track, manage and archive work-in-progress assets – all
in real time.
- In Q1 2018, MediaValet continued to evolve its product
integration strategy to further increase the value delivered by
MediaValet within customer environments. These integrations have
proven valuable in customer acquisition and retention. In
May 2018, MediaValet announced
integration with Workfront, a leading provider of
cloud-based enterprise work management solutions, enterprise
project management and workflow software.
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 research and create 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.
- In February 2018, Rob Chase expanded his role with the Company,
joining the senior management team as Executive Chairman and Chief
Financial Officer. Rob brings over 20 years of technology,
software-as-a-service, start-up and M&A experience, including
14 years with Absolute Software as CFO and COO where he helped lead
the company from $4 million to
$100 million in profitable sales, and
2 years as Director with PNI Digital Media which concluded with the
successful sale of the company to Staples. 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. The
Company paid cash commissions of $460,709 and issued 7,678,487 broker warrants to
the agents. The warrants are exercisable over 24 months at a price
of $0.06 per share for the first year
and $0.09 per share thereafter. The
use of proceeds includes retiring $3.18
million of debt and funding the Company's 2018 growth
initiatives.
|
1 March 31, 2017
figures have not been restated for adoption of IFRS 9 and IFRS 15
as the changes were applied in Q1 2018 on a cumulative effect
basis. The percent change for March 31, 2018 compared to restated
2017 amounts, is a 2% decline for Cost of Revenue and Operating
Expenses, and a 17% 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 that is used as a 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 such as financing costs. Refer to the
Operating Results section for further information on the
calculation and definition of EBITDA.
|
|
4 Annual Recurring Revenue
(ARR) is a non-IFRS measure that provides an indication 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, and as such 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 on a monthly basis 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 on 50 Microsoft data centers 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, 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.
"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 MediaValet Inc.