All amounts are stated in United States dollars unless otherwise
indicated
- Revenue increased on a sequential basis to $16.7 million
- Focus on growth continues to push year-to-date New
Bookings(1) to $24.1
million versus $7.7 million
during the same period last year
- Gross margin at record levels of 79%
- Net income of $3.8 million
compared to a net loss of $29.2
million in Q3'20
- Adjusted EBITDA(1) of $5.9
million or 35%, versus $6.8
million in Q3'20, representing the fifth consecutive quarter
of Adjusted EBITDA margin above 25%
- Balance sheet remains robust with $32.8
million(2) in cash to support growth
- Adjusted EPS(1) of $0.35
TORONTO, Nov. 10, 2021 /CNW/ - Optiva Inc. ("Optiva" or
"the Company") (TSX:OPT), a leading provider of mission-critical,
cloud-native revenue management software for the telecommunications
industry, today released its third quarter financial results for
the three-month period ended September 30,
2021.
"I am pleased with our continued success in executing our
strategic objectives during Q3 with customer wins, increased
bookings and strong cost management. We are in line with our fiscal
year 2021 plan and, in some instances, ahead of expectations," said
John Giere, President and Chief
Executive Officer of Optiva. "We remain committed to being a very
customer-centric organization, which combined with our industry
expertise and first-mover advantage in the private and public cloud
telco market, positions us extremely well to capture meaningful
growth on the back of having established solid footing across all
aspects of our business."
"Our customers continue to be very engaged with our team in
exploring the most appropriate pathway to realize their long-term
business goals balanced against their nearer-term immediate needs,
bridging the gap to implement a full-cloud migration plan in
strategic partnership with Optiva," added Giere.
Business Highlights
- Optiva continues to invest in strengthening and building its
global sales team to drive increased bookings, customer retention,
contract renewals, service enhancement and delivery growth. As a
result of our initiatives, New Bookings increased to $11.3 million in Q3 '21, and $24.1 million on a year-to-date basis.
- The Company continues to add to its R&D talent and is on
track for our new product launch by Q1'22. A critical element
of our strategy is to establish, where appropriate, R&D Centers
of Excellence. The Company has established our first R&D Centre
of Excellence in Belfast, Northern
Ireland. The Centre will focus on the development and
delivery of Optiva's cloud-native software solutions, accelerating
the innovation investment within our roadmap.
- During Q3'21, the Company completed the insourcing of its key
finance department functions.
- A leading Saudi-based telecom operator selected Optiva BSS
Platform for its new MVNO business line to rapidly bring to market
innovative digital services to the fast-growing consumer market
segment. The partnership enables the operator to deploy Optiva
cloud-native BSS technology on its state-of-the-art, private cloud
infrastructure. The solution will provide a differentiated,
superior customer experience and digital service offerings that
build upon the operator's strong enterprise customer base and
accelerate the velocity of its product introduction cycle to more
quickly deliver profitable growth.
- Optiva has been selected as an approved vendor for next
generation charging solution by a large multinational
telecommunications group, operating in countries in Africa and the Middle East. The Company's services include
cellular network access and business solutions.
- The Company announced the launch of its new MVNx Fast Track
program - (https://optiva.com/mvnx/), which provides MVNOs and
MVNEs an all-in-one, cloud-native BSS MVNx solution. The program
allows them to deploy in 90 days, realize more than 40% of total
cost of ownership and operations cost savings, leverage embedded
testing and customer service automation and rollout new
propositions within three hours with out-of-the-box templates and
guided configuration flows.
Third Quarter 2021 Financial Results Highlights:
|
|
|
|
Q3 Fiscal 2021
Highlights
|
Three Months
Ended
|
|
Nine Months
Ended
|
($ US Thousands,
except per share information)
|
September
30,
|
|
September
30,
|
(Unaudited)
|
2021
|
2020
|
|
2021
|
2020
|
Revenue
|
16,666
|
18,804
|
|
49,068
|
57,774
|
Net Income
(Loss)
|
3,783
|
(29,221)
|
|
21,813
|
(43,190)
|
Earnings (Loss) Per
Share
|
$ 0.62
|
$(5.50)
|
|
$ 3.73
|
$(8.12)
|
Adjusted
EBITDA
|
5,901
|
6,819
|
|
14,975
|
(2,906)
|
Cash provided by
(used in) operating activities
|
5,217
|
(1,398)
|
|
5,948
|
(5,279)
|
Total cash, including
restricted cash
|
32,823
|
21,306
|
|
32,823
|
21,306
|
- Revenue for Q3'21 decreased by $2.1
million to $16.7 million,
driven by known attritions while showing early indication of
stabilizing at current levels. The year-over-year decrease in
revenue was primarily due to the discontinuation of software,
support and subscription sales to customers who had previously
notified Optiva of their exit.
- Gross margin reached a new record level at 79% in Q3'21,
increasing 4% over the 75% gross margin achieved during the
corresponding period in 2020. This increase was mainly attributable
to continued strict cost management and operational
efficiencies.
- General and administrative expenses decreased to $3.0 million when compared to $8.3 million during the same period in 2020. The
decrease is mainly due to lower legal and advisory costs related to
activities of the special committee of the board of directors
incurred last year, lower amortization costs, lower stock-based
compensation, and bad debt recovery, slightly offset by higher
compensation costs.
- Earnings before interest, taxes, depreciation and amortization
("EBITDA")(1) for Q3'21 of 2021 was $5.9 million compared to $5.6 million during the same period in 2020.
Adjusted EBITDA(1) ("Adjusted EBITDA") for Q3'21
amounted to $5.9 million as compared
to $6.8 million during the same
period in 2020. The Adjusted EBITDA for Q3'21 includes a reversal
of bad-debt provision of $0.8
million.
- Net income for Q3'21 was $3.8
million compared to a loss of $29.2
million during the corresponding period in 2020. The
increase in net income is mainly attributable to the Company's
ongoing focus on cost management and overall operating expenses and
higher finance costs last year related to accretion of preferred
shares on redemption.
(1)
|
EBITDA,Adjusted
EBITDA, new bookings and adjusted EPS are non-IFRS measures. These
measures are defined in the "Non-IFRS Financial Measures" section
of this news release
|
(2)
|
Includes restricted
cash
|
Conference Call
Optiva Inc. will hold an analyst call on November 11, 2021, to discuss its Q3 '21
financial results for the three-month period ended September 30, 2021. John
Giere, CEO, and Ashish Joshi,
CFO, will host the call starting at 8:00
a.m. Eastern time. A question and answer session will follow
management's discussion.
Date: Thursday, November 11,
2021
Time: 8:00 a.m. Eastern Time
Toll-free (Canada/US):
1-866-248-8441
International: 1-720-452-9102
Reference number: 7088116
Please call the conference telephone number 5-10 minutes prior
to the start time. An operator will register your name and
organization.
Non-IFRS Measures
"EBITDA" and "Adjusted EBITDA" are not financial measures
calculated and presented in accordance with International Financial
Reporting Standards (IFRS) and should not be considered in
isolation or as a substitute to net income (loss), operating income
or any other financial measures of performance calculated and
presented in accordance with IFRS, or as an alternative to cash
flow from operating activities as a measure of liquidity. The
Company defines EBITDA as net income (loss) excluding amounts for
depreciation and amortization, other income, finance costs, finance
income, income tax expense (recovery), foreign exchange gain (loss)
and share-based compensation. The Company defines "Adjusted EBITDA"
as EBITDA (as defined above), excluding restructuring costs,
one-time provision amounts, and any one-time transaction costs
associated with shareholder conflict. The Company believes that
Adjusted EBITDA is a metric that investors may find useful in
understanding the Company's financial position. The following table
provides a reconciliation of Net Income to EBITDA and Adjusted
EBITDA.
New Bookings are total bookings minus SLA renewals. New
Bookings Indicates the contractually committed revenue, excluding
renewal of maintenance/support contracts from existing customers,
that we expect to recognize over the forthcoming quarters. New
Bookings is thus a subset of our Total Bookings in a particular
period. New Booking indicates our success in contracting new
business whereas Total Bookings reflects our success in both,
contracting new business as well as renewing existing maintenance
and support SLAs.
Adjusted EPS is reported diluted EPS excluding the impact of
change in the fair value of warrants.
|
|
|
|
|
|
Three months ended,
September 30
|
Nine months ended,
September 30
|
|
2021
|
2020
|
2021
|
2020
|
|
|
|
|
|
Net income (loss) for
the period
|
$
|
3,783,002
|
$
|
(29,220,983)
|
$
|
21,812,912
|
$
|
(43,189,879)
|
|
|
|
|
|
Add back /
(substract):
|
|
|
|
|
Depreciation of
property and equipment
|
65,161
|
-
|
83,601
|
-
|
Amortization of
intangible assets
|
362,763
|
2,188,032
|
1,088,289
|
7,140,553
|
Finance
(income)
|
(328,765)
|
(173,251)
|
(471,360)
|
(250,074)
|
Finance costs
(recovery)
|
804,557
|
29,660,877
|
(9,500,031)
|
28,282,767
|
Income tax
expense
|
833,422
|
1,987,199
|
2,438,396
|
2,675,506
|
Foreign exchange loss
(gain)
|
(109,584)
|
(282,702)
|
(635,219)
|
1,899,005
|
Share-based
compensation
|
490,144
|
1,421,022
|
1,905,976
|
535,890
|
EBITDA
|
5,900,700
|
5,580,194
|
16,722,564
|
(2,906,232)
|
|
|
|
|
|
Restructuring
costs
|
-
|
59,440
|
-
|
202,162
|
Change in other
provisions
|
-
|
-
|
(1,313,725)
|
3,072,717
|
One-time costs
(recovery) related to shareholder conflict
|
|
|
|
|
and debenture
financing
|
-
|
1,179,264
|
(433,610)
|
2,101,129
|
|
|
|
|
|
Adjusted
EBITDA
|
$
|
5,900,700
|
$
|
6,818,898
|
$
|
14,975,229
|
$
|
2,469,776
|
|
|
|
|
|
About Optiva
Optiva Inc. is a leading provider of mission-critical,
cloud-native revenue management software for the telecommunications
industry. Its products are delivered globally on the private and
public cloud. The Company's solutions help service providers
maximize digital, 5G, IoT and emerging market opportunities to
achieve business success. Established in 1999, Optiva Inc. is on
the Toronto Stock Exchange (TSX: OPT). For more information, visit
www.optiva.com.
Caution Concerning Forward-Looking Statement
Certain statements in this document may constitute
"forward-looking" statements that involve known and unknown risks,
uncertainties and other factors that may cause our actual results,
performance or achievements or industry results to be materially
different from any future results, performance or achievements
expressed or implied by such forward looking statements. When used
in this document, such statements use such words as "may," "will,"
"expect," "continue," "believe," "plan," "intend," "would,"
"could," "should," "anticipate" and other similar terminology.
These statements are forward-looking as they are based on our
current expectations, as at November 10,
2021, about our business and the markets we operate in and
on various estimates and assumptions. Our actual results could
materially differ from our expectations if known or unknown risks
affect our business or if our estimates or assumptions turn out to
be inaccurate. As a result, there is no assurance that any
forward-looking statements will materialize. Risks that could cause
our results to differ materially from our current expectations are
discussed in the Company's most recent Annual Information Form,
which is available on SEDAR at www.sedar.com and on Optiva's
website at www.optiva.com/investors/. Other unknown or
unpredictable factors or underlying assumptions subsequently
proving to be incorrect could cause actual results to differ
materially from those in the forward-looking statements. Optiva
does not undertake or accept any obligation or undertaking to
release publicly any updates or revisions to any forward-looking
statements to reflect any change in its expectations or any change
in events, conditions or circumstances on which any such statement
is based, except as required by law.
OPTIVA
Inc.
|
|
|
Condensed
Consolidated Interim Statements of Financial Position
|
|
(Expressed in U.S.
dollars)
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
September
30,
|
December
31,
|
|
2021
|
2020
|
|
|
|
Assets
|
|
|
|
|
|
Current
assets:
|
|
|
Cash and cash
equivalents
|
$
|
32,031,896
|
$
|
17,663,998
|
Trade accounts and
other receivables
|
9,241,414
|
7,868,501
|
Unbilled
revenue
|
6,310,487
|
4,086,395
|
Prepaid
expenses
|
3,053,180
|
2,752,304
|
Income taxes
receivable
|
4,316,147
|
4,281,673
|
Other
assets
|
747,621
|
222,101
|
Total current
assets
|
55,700,745
|
36,874,972
|
|
|
|
Restricted
cash
|
791,372
|
625,692
|
Property and
equipment
|
847,517
|
-
|
Long-term unbilled
revenue
|
2,940,041
|
3,520,177
|
Deferred income
taxes
|
351,336
|
208,237
|
Other
assets
|
107,353
|
624,134
|
Intangible
assets
|
2,539,464
|
3,255,482
|
Goodwill
|
32,271,078
|
32,271,078
|
|
|
|
Total
assets
|
$
|
95,548,906
|
$
|
77,379,772
|
|
|
|
Liabilities and
Shareholders' Deficit
|
|
|
|
|
|
Current
liabilities:
|
|
|
Trade
payables
|
$
|
4,296,734
|
$
|
8,811,407
|
Accrued
liabilities
|
9,719,033
|
9,677,245
|
Provisions
|
4,200,000
|
5,555,373
|
Income taxes
payable
|
5,661,702
|
4,932,157
|
Deferred
revenue
|
4,301,164
|
4,894,195
|
Total current
liabilities
|
28,178,633
|
33,870,377
|
|
|
|
Deferred
revenue
|
487,312
|
661,837
|
Other
liabilities
|
1,822,907
|
2,797,836
|
Pension and other
long-term employment benefit plans
|
10,918,925
|
15,582,459
|
Debentures
|
86,818,996
|
86,338,367
|
Series A
Warrant
|
768,340
|
16,662,808
|
Standby
Warrant
|
92,550
|
-
|
Deferred income
taxes
|
769,379
|
898,146
|
Total
liabilities
|
129,857,042
|
156,811,830
|
|
|
|
Shareholders'
deficit:
|
|
|
Share
capital
|
269,992,761
|
250,904,013
|
Standby
Warrant
|
-
|
997,500
|
Contributed
surplus
|
13,389,540
|
11,406,814
|
Deficit
|
(314,029,337)
|
(335,842,249)
|
Accumulated other
comprehensive loss
|
(3,661,100)
|
(6,898,136)
|
Total shareholders'
deficit
|
(34,308,136)
|
(79,432,058)
|
|
|
|
Total liabilities and
shareholders' deficit
|
$
|
95,548,906
|
$
|
77,379,772
|
OPTIVA
Inc.
|
Condensed
Consolidated Interim Statements of Comprehensive Income
(Loss)
|
(Expressed in U.S.
dollars, except per share and share amounts)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended,
September 30
|
Nine months ended,
September 30
|
|
2021
|
2020
|
2021
|
2020
|
|
|
|
|
|
Revenue:
|
|
|
|
|
Support and
subscription
|
$
|
11,411,812
|
$
|
14,077,343
|
$
|
35,681,432
|
$
|
44,030,708
|
Software licenses,
services and other
|
5,253,879
|
4,726,877
|
13,386,078
|
13,742,981
|
|
16,665,691
|
18,804,220
|
49,067,510
|
57,773,689
|
|
|
|
|
|
Cost of
revenue
|
3,491,639
|
4,649,294
|
10,765,379
|
15,124,936
|
|
|
|
|
|
Gross
profit
|
13,174,052
|
14,154,926
|
38,302,131
|
42,648,753
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
Sales and
marketing
|
1,788,771
|
1,581,100
|
5,502,413
|
6,272,788
|
General and
administrative
|
2,990,055
|
8,288,092
|
11,983,848
|
23,893,409
|
Research and
development
|
3,412,594
|
2,255,154
|
7,171,172
|
22,863,069
|
Restructuring
costs
|
-
|
59,440
|
-
|
202,162
|
|
8,191,420
|
12,183,786
|
24,657,433
|
52,231,428
|
|
|
|
|
|
Income (loss) from
operations
|
4,982,632
|
1,971,140
|
13,644,698
|
(10,582,675)
|
|
|
|
|
|
Foreign exchange gain
/ (loss)
|
109,584
|
282,702
|
635,219
|
(1,899,005)
|
Finance
income
|
328,765
|
173,251
|
471,360
|
250,074
|
Finance (cost)
recovery
|
(804,557)
|
(29,660,877)
|
9,500,031
|
(28,282,767)
|
|
|
|
|
|
Income (loss) before
income taxes
|
4,616,424
|
(27,233,784)
|
24,251,308
|
(40,514,373)
|
|
|
|
|
|
Income taxes
(recovery):
|
|
|
|
|
Current
|
922,153
|
2,100,108
|
2,691,270
|
2,795,866
|
Deferred
|
(88,730)
|
(112,909)
|
(252,874)
|
(120,360)
|
|
833,422
|
1,987,199
|
2,438,396
|
2,675,506
|
|
|
|
|
|
Net income
(loss)
|
$
|
3,783,002
|
$
|
(29,220,983)
|
$
|
21,812,912
|
$
|
(43,189,879)
|
|
|
|
|
|
Other comprehensive
income:
|
|
|
|
|
Items that will not
be reclassified
|
|
|
|
|
to net
income:
|
|
|
|
|
Actuarial gain (loss)
on pension and non-pension
|
|
|
|
|
post-employment benefit plans, net of
income
|
|
|
|
|
tax
expense of nil:
|
$
|
3,237,036
|
$
|
(3,560,350)
|
$
|
3,237,036
|
$
|
(3,560,350)
|
|
|
|
|
|
Total comprehensive
income (loss)
|
$
|
7,020,038
|
$
|
(32,781,333)
|
$
|
25,049,948
|
$
|
(46,750,229)
|
|
|
|
|
|
|
|
|
|
|
Income (loss) per
common share:
|
|
|
|
|
Basic
|
$
|
0.62
|
$
|
(5.50)
|
$
|
3.73
|
$
|
(8.12)
|
Diluted
|
0.61
|
(5.50)
|
3.68
|
(8.12)
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of common shares:
|
|
|
|
|
Basic
|
6,150,557
|
5,315,757
|
5,850,993
|
5,315,903
|
Diluted
|
6,159,307
|
5,315,757
|
5,926,567
|
5,315,903
|
|
|
|
|
|
OPTIVA
Inc.
|
|
|
|
|
Condensed
Consolidated Interim Statements of Cash Flows
|
|
(Expressed in U.S.
dollars)
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended,
September 30
|
Nine months ended,
September 30
|
|
2021
|
2020
|
2021
|
2020
|
|
|
|
|
|
Cash provided by
(used in):
|
|
|
|
|
|
|
|
|
|
Operating
activities:
|
|
|
|
|
Income (loss) for the
period
|
$
|
3,783,002
|
$
|
(29,220,983)
|
$
|
21,812,912
|
$
|
(43,189,879)
|
Adjustments
for:
|
|
|
|
|
Depreciation of
property and equipment
|
65,161
|
-
|
83,601
|
-
|
Amortization of
intangible assets
|
362,763
|
2,188,032
|
1,088,289
|
7,140,553
|
Finance
(income)
|
(328,765)
|
(173,251)
|
(471,360)
|
(250,074)
|
Finance costs
(recovery)
|
804,557
|
29,660,877
|
(9,500,031)
|
28,282,767
|
Pension
|
9,015
|
100,932
|
(709,033)
|
109,323
|
Income tax
expense
|
833,422
|
1,987,199
|
2,438,396
|
2,675,506
|
Unrealized foreign
exchange loss (gain)
|
40,961
|
(11,484)
|
(409,081)
|
(1,055,526)
|
Share-based
compensation
|
490,144
|
1,421,022
|
1,905,976
|
535,890
|
Change in
provisions
|
-
|
(258,968)
|
(1,355,373)
|
2,098,172
|
Change in non-cash
operating working capital
|
(1,018,447)
|
(5,505,549)
|
(7,004,459)
|
1,561,903
|
|
5,041,813
|
187,827
|
7,879,837
|
(2,091,365)
|
Interest
paid
|
(40,297)
|
(7,656)
|
(93,054)
|
(34,070)
|
Interest
received
|
8,656
|
6,020
|
18,625
|
75,934
|
Income taxes received
(paid)
|
206,465
|
(1,584,095)
|
(1,857,734)
|
(3,229,262)
|
|
5,216,637
|
(1,397,904)
|
5,947,674
|
(5,278,763)
|
|
|
|
|
|
Financing
activities:
|
|
|
|
|
Payment of
dividends
|
-
|
(11,378,719)
|
-
|
(13,588,145)
|
Issue of share
capital
|
-
|
-
|
19,088,748
|
-
|
Payment of interest
on loans and borrowings
|
(4,351,439)
|
-
|
(8,764,162)
|
-
|
Redemption of
preferred shares
|
-
|
(80,000,000)
|
-
|
(80,000,000)
|
Transaction costs on
debentures
|
-
|
(3,315,583)
|
-
|
(3,315,583)
|
Issuance of
debentures
|
-
|
90,000,000
|
-
|
90,000,000
|
|
(4,351,439)
|
(4,694,302)
|
10,324,586
|
(6,903,728)
|
|
|
|
|
|
Investing
activities:
|
|
|
|
|
Purchase of property
and equipment
|
(665,636)
|
-
|
(931,118)
|
-
|
Purchase of
software
|
(372,271)
|
-
|
(372,271)
|
-
|
(Increase) / Decrease
in restricted cash
|
(253,885)
|
57,647
|
(165,680)
|
261,165
|
|
(1,291,792)
|
57,647
|
(1,469,069)
|
261,165
|
|
|
|
|
|
Effect of foreign
exchange rate changes
|
|
|
|
|
on cash and cash
equivalents
|
(476,654)
|
223,160
|
(435,293)
|
788,793
|
|
|
|
|
|
Increase (decrease)
in cash and cash equivalents
|
(903,248)
|
(5,811,399)
|
14,367,898
|
(11,132,533)
|
|
|
|
|
|
Cash and cash
equivalents, beginning of period
|
32,935,144
|
26,426,859
|
17,663,998
|
31,747,993
|
|
|
|
|
|
Cash and cash
equivalents, end of period
|
$
|
32,031,896
|
$
|
20,615,460
|
$
|
32,031,896
|
$
|
20,615,460
|
SOURCE Optiva Inc.