D-BOX Technologies Inc. (TSX: DBO), a world leader in haptic
and immersive entertainment experiences, announced today its
financial results for the second quarter ended September 30, 2020.
All amounts in this press release are in Canadian dollars.
FINANCIAL HIGHLIGHTS
Highlights for the Second Quarter Ended
September 30, 2020
- Cash and cash equivalents was $5.0 million as at September 30,
2020 compared to $4.1 million as at March 31, 2020, while during
the same period, cash flow provided by working capital has
generated $2.6 million, the line of credit balance decreased by
$1.0 million and long-term debt increased by $2.0 million.
- Total revenues decreased to $2.9 million from $6.3 million for
the same period last year as a result of the adverse impact of the
COVID-19 pandemic.
- Net loss remained flat at $0.9 million compared to the same
period last year.
- Adjusted EBITDA* decreased to ($0.6) million from $0.1 million
for the same period last year.
Highlights for the six-month period
ended September 30, 2020
- Total revenues decreased to $5.1 million from $13.9 million for
the same period last year as a result of the adverse impact of the
COVID-19 pandemic.
- Net loss increased to $1.9 million from $1.5 million for the
same period last year.
- Adjusted EBITDA* decreased to ($0.7) million from $0.3 million
for the same period last year.
This quarter’s results continued to be impacted
by the COVID-19 global pandemic, but the Corporation made progress
on generating royalties as some movie theatres have resumed its
activities. While we do not know the future impact COVID-19 will
have on our business, or when our business will fully return to
normal operations, the Corporation expects to see a continued
impact from COVID-19 on its results in the upcoming quarters,
especially in the commercial entertainment business where some
commercial entertainment venues are forced to close
temporarily.
Second quarter and Six-month period ended
September 30 (in thousands of dollars, except per share
amounts) |
|
Second Quarter |
Six-month Period |
2020 |
|
2019 |
|
2020 |
|
2019 |
|
Revenues |
2,917 |
|
6,329 |
|
5,146 |
|
13,862 |
|
Net loss |
(954 |
) |
(933 |
) |
(1,920 |
) |
(1,539 |
) |
Adjusted EBITDA* |
(571 |
) |
114 |
|
(667 |
) |
329 |
|
Basic and diluted net loss per share |
(0.005 |
) |
(0.005 |
) |
(0.010 |
) |
(0.008 |
) |
Information from the consolidated balance
sheet |
|
As at September 30, 2020 |
As at March 31, 2020 |
Cash and cash equivalents |
4,979 |
4,116 |
* See the “Non-IFRS” measures” section in the Management’s
Discussion and Analysis dated November 11, 2020.
"We are pleased with the progress that D-BOX has
accomplished on multiple fronts in the past few months. Ensuring a
healthy balance sheet has always been a top priority and we are
proud that we have been able to manage our spending and get some
additional financing to maintain a cash position that is greater
than at the beginning of the COVID-19 pandemic. With the
expectation of a progressive recovery of our recurring revenue from
the theatrical market in the next months and the future
contribution of home entertainment revenue, we are cautiously
optimistic that the brunt of the situation is at a tail end,”
mentioned Mr. Sébastien Mailhot, President and CEO of D-BOX.
“This quarter, recovery on our business has been
encouraging with total revenues growing at 31% sequentially between
Q2 over Q1. The simulation and training segments grew 44%
sequentially and 17% compared to the same period last year in large
part due to the increasing penetration of simracing at home and
great value proposition of our simulation and training offering.
With the recent endorsement of the FIA, we do expect to see
continued sequential growth,” stated Mr. Mailhot.
“Our long-awaited immersive and haptic
home entertainment system is now ready! We are proud to launch a
home entertainment recliner, in partnership with Jaymar, that will
integrate D-BOX’s haptic technology. It is an important milestone
given the size of the market opportunity; U.S. consumers spent over
$25 billion in 2019, up 8.4% from the year before, in home
entertainment streaming services, video-on-demand and electronic
title purchases. By leveraging D-BOX’s strong brand and market
leadership in haptics, D-BOX has a unique opportunity to enhance
the experience of consumers by providing a true-to-life experience
from their home. Consumers will be able to enjoy over 2,000 pieces
of content and growing, including movies, TV series, music, video
games, and a relaxation mode. Over time, D-BOX will add new content
types of all sorts and will constantly update the existing content.
The movements, vibrations and textures will make entertainment
lovers feel their favorite theme park ride, the beats of a live
concert or experience floating on the moon. The possibilities
are endless!” added Mr. Mailhot.
In other news, the Corporation is pleased to
announce the appointment this day of Eve Laurier to the
Corporation’s Board of Directors. Mrs. Laurier brings more than 20
years of experience in communication and marketing strategy.
Currently, she is General Manager of Edelman Montreal's
communications firm and is also a member of Edelman Canada’s
management team, a global public relations firm. Prior to joining
Edelman, Mrs. Laurier worked for Richter, an accounting and
financial consulting firm, where she held the position of
Vice-President, Strategic Relations. In 2020, she earned the
‘Revelation’ of the Quebec Association of Women in Finance, as well
as a finalist at the Mercuriades for the Women of Exception Award.
Mrs. Laurier holds an Executive MBA from McGill University and HEC
Montréal. As well, she sits on the board of the Marie-Vincent
Foundation (2017) and the Metropolitan Orchestra (2017). “We
welcome Mrs. Laurier to D-BOX’s board. Her appointment comes with
perfect timing, just as we are about to launch our home
entertainment strategy. Her strong credentials in communications
and marketing and her vast business network will be a great asset
as we maximize D-BOX awareness”, stated Mr. Denis Chamberland.
OPERATIONAL HIGHLIGHTS
- D-BOX and Jaymar, a leading manufacturer of upholstered
furniture in Canada, partnered to offer consumers a recliner which
integrates D-BOX haptic technology, providing fans of series,
movies and video games with immersive and haptic experiences.
- Part of its gaming strategy, D-BOX has been locking a lineup of
video game franchises such as Ubisoft latest Assassin’s Creed
Valhalla, Microsoft’s Flight Simulator, and Slightly Mad Studios’
Project CARS 3.
- The Fédération Internationale de l'Automobile (FIA), the
governing body of motor sport and mobility, announced
the exclusive endorsement of D-BOX products.
The D-BOX haptic system enables drivers to feel an incredibly
powerful and reliable simulator that responds precisely to any
in-game situation. The experience features subtle cues based on
pavement variations, vehicle physics, acceleration, deceleration,
braking, cornering, suspension feedback, traction, weather
conditions and speed.
ADDITIONAL INFORMATION
The financial information relating to the second
quarter ended September 30, 2020 should be read in conjunction
with the Corporation’s unaudited condensed consolidated financial
statements and the Management’s Discussion and Analysis dated
November 11, 2020. These documents are available at
www.sedar.com.
RECONCILIATION OF ADJUSTED EBITDA TO NET INCOME
(LOSS)*
Adjusted EBITDA provides useful and
complementary information, which can be used, in particular, to
assess profitability and cash flows from operations. It consists of
net income (loss) excluding amortization, financial expenses net of
income, income taxes, impairment charges, share-based payments,
foreign exchange loss (gain) and non-recurring expenses related to
restructuring costs. The following table reconciles adjusted EBITDA
to net loss:
All amounts are in thousands of Canadian
dollars
|
Second quarterended September 30 |
Six-month Period endedSeptember 30 |
2020 |
|
2019 |
|
2020 |
|
2019 |
|
Net loss |
(954 |
) |
(933 |
) |
(1,920 |
) |
(1,539 |
) |
Amortization of property and
equipment |
401 |
|
439 |
|
876 |
|
856 |
|
Amortization of intangible
assets |
189 |
|
204 |
|
380 |
|
462 |
|
Amortization of other assets |
— |
|
1 |
|
— |
|
2 |
|
Loss on disposal of property and
equipment |
— |
|
2 |
|
— |
|
2 |
|
Financial expenses (income) |
98 |
|
280 |
|
191 |
|
373 |
|
Income taxes (recovery) |
(1 |
) |
6 |
|
(1 |
) |
(1 |
) |
Share-based payments |
31 |
|
16 |
|
77 |
|
61 |
|
Foreign exchange loss(gain) |
(335 |
) |
99 |
|
(270 |
) |
113 |
|
Adjusted EBITDA |
(571 |
) |
114 |
|
(667 |
) |
329 |
|
* See the “Non-IFRS measures” section in the Management’s
Discussion and Analysis dated November 11, 2020.
ABOUT D-BOX
D-BOX redefines and creates realistic, haptic
and immersive entertainment experiences by providing feedback to
the whole body and sparking the imagination through motion. Haptic
essentially allows to feel sensations that would be felt if the
body was interacting directly with physical objects. D-BOX has
collaborated with some of the best companies in the world to
deliver new ways to enhance great stories. Whether it’s movies,
video games, virtual reality applications, themed entertainment or
professional simulation, D-BOX creates a feeling of presence that
makes life resonate like never before.
D-BOX Technologies Inc. (TSX: DBO) is
headquartered in Montreal with offices in Los Angeles, USA and
Beijing, China. Visit d-box.com
DISCLAIMER REGARDING FORWARD-LOOKING
STATEMENTS
This news release contains statements that may
constitute “forward-looking information” within the meaning of
applicable Canadian securities legislation. Forward-looking
information may include, among others, statements regarding the
future plans, activities, objectives, operations, strategy,
financial performance and condition of the Corporation, or the
assumptions underlying any of the foregoing. In this news release,
words such as “may”, “would”, “could”, “will”, “likely”, “believe”,
“expect”, “anticipate”, “intend”, “plan”, “estimate” and similar
words and the negative form thereof are used to identify
forward-looking statements. Forward-looking statements should not
be read as guarantees of future performance or results, and will
not necessarily be accurate indications of whether, or the times at
or by which, such future performance will be achieved. No assurance
can be given that any events anticipated by the forward-looking
information will transpire or occur. Forward-looking information is
based on information available at the time and/or management's
good-faith belief with respect to future events and are subject to
known or unknown risks, uncertainties, assumptions and other
unpredictable factors, many of which are beyond the Corporation’s
control.
These risks, uncertainties and assumptions
include, but are not limited to, those described under “Risk
Factors” in the Corporation’s Annual Information Form for the
fiscal year ended March 31, 2020, a copy of which is available on
SEDAR at www.sedar.com, and could cause actual events or results to
differ materially from those projected in any forward-looking
statements. The Corporation does not intend, nor does the
Corporation undertake any obligation, to update or revise any
forward-looking information contained in this news release to
reflect subsequent information, events or circumstances or
otherwise, except if required by applicable laws.
FOR FURTHER INFORMATION, PLEASE
CONTACT:
David Montpetit Chief Financial Officer D-BOX Technologies Inc. 450
442-3003, ext. 296dmontpetit@d-box.com |
Steve Li Vice President Investor Relations and Corporate
StrategyD-BOX Technologies Inc. 450 442-3003, ext.
403sli@d-box.com |
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