Double digit quarter over quarter growth from
measurement and data products
supplemented with improving traction from core Killi
application
TORONTO, Nov. 6, 2019 /CNW/ - Freckle Ltd.
(TSXV: FRKL) (the "Company"), a leader in privacy-compliant data
and offline media measurement, announces its financial results for
the three and nine months ended September
30, 2019 ("Q3 2019"). Please refer to the interim unaudited
condensed Consolidated Financial Statements and Management's
Discussion and Analysis ("MD&A") for the three and nine months
ended September 30, 2019 filed on
SEDAR at www.sedar.com for more information. Unless otherwise
stated, all dollar amounts are expressed in Canadian dollars.
HIGHLIGHTS FROM Q3 2019
- Revenue of $0.9 million – a 14%
increase over Q2 2019 and 3% over the same quarter in the prior
year;
- Strong performance in quarter over quarter key financial
drivers for the Killi application when compared to the second
quarter of 2019. The Company is focused on initiatives to
continue to drive these metrics going forward. A summary is listed
below;
-
- Increase of 18% in Average Revenue Per User ("ARPU") Q2 2019 to
Q3 2019
- Improvement of Cost Per Acquisition ("CPA") by 30% Q2 2019 to
Q3 2019
- Cost reduction of 6% of internal surveys for Killi Q2 2019 to
Q3 2019
- Implementation of a leading global research survey provider
into core Killi application, introducing a new recurring,
international revenue line.
- Recurring revenue increased to 72% compared to 68% in Q2 2019
and 30% in 2018;
- Data sales expanded over 500% in Q3 2019 vs Q2 2018
- Entered into partnerships with Quan Media, Giant Media and
Neustar in order to expand the distribution of Freckle data and
measurement products to new customers in a growing US market;
and,
- Exited the quarter with $4.2
million in cash, no debt, and $4.3
million in working capital.
MANAGEMENT COMMENTARY
"The third quarter of 2019 was a strong period of development
for the Freckle product suite and the Killi app," said Neil Sweeney, CEO of Freckle. "We saw our core
revenues in Freckle increase overall while at the same time
improving the sales mix by moving towards better margin and
stronger recurring revenue streams. In addition, we continued
to advance our partnership agreements with a number of
announcements with firms in the data, research, outdoor advertising
and video spaces over Q3 with additional Q4 announcements already
in market. Most importantly, we continued with the development of
our identity product, Killi, a mobile application that is available
in the USA and Canada for both iOS and Android. We made
significant strides in implementing external surveys within the
Killi application, allowing us to improve our core revenue metrics
for Killi users and establishing a new revenue model that we are
focused on growing in the coming quarters.
We believe the market is moving very quickly towards a position
that will require consumer opt-in for data use. As a company
that has been working in this space for over a year we are focused
on growing this product suite in order to serve a market with an
insatiable appetite for this data. We plan to expand Killi to
incorporate additional revenue and data control modules for
consumers while looking to expand outside of the application to
other areas where consumer data is currently collected. Our
balance sheet is solid; our team is growing and enthusiastic; and I
look forward to providing further updates as we continue to build
the only data privacy compliant solution that is focused on
addressing privacy and compliance across all 50 U.S. states and
internationally ."
BUSINESS OUTLOOK
The Company's overall objective is to
continue to grow Freckle's business with stable recurring revenue
while also building Killi into the leading global
direct-to-consumer (DTC) platform for data privacy. We will
continue to improve the key Killi metrics to drive the cost of
acquisition down while increasing the average revenue per user per
month to reduce the disparity between the lifetime value of a Killi
user and their acquisition cost. Once at a neutral position
with Lifetime Value ("LTV") and CPA the Company will then apply
more traditional methods of scaling users as doing so should be
cash neutral.
Key Goals for the Fourth Quarter of 2019
- Expand the Killi application outside of the North American
market;
- Introduce an additional third-party research engine into the
Killi application, increasing ARPU for Killi;
- Add incentivized video module to the Killi application in order
to increase ARPU for Killi;
- Improve the user interface (UI) of the Killi application to
improve engagement and user retention;
- Secure and announce an international data distribution deal to
expand the global presence of Freckle;
- Secure and announce another significant partnership in Q4;
and
- Demonstrate quarter over quarter revenue growth in Q4 at
similar rates realized in Q3, while sustaining the current
recurring revenue.
CONFERENCE CALL TO DISCUSS Q3 2019 FINANCIAL RESULTS
President and CEO Neil Sweeney
and CFO Andrew Elinesky will host a
conference call to discuss the results at 8:00am EST on
Thursday, November 7, 2019. All
interested parties are invited to participate in this conference
call and should dial the numbers below 10 minutes before the
starting time.
Date &
Time:
|
Thursday, November 7,
2019 - 8:00 AM EST
|
Dial-in
number:
|
Toll Free:
Toll/International:
|
(877)
830-2591
(785)
424-1738
|
Conference
ID:
|
95847
|
Replay:
|
A link to a recording
of the conference call will be available on Freckle's
website.
|
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 news release.
DISCLAIMER FOR FORWARD-LOOKING INFORMATION
Certain
statements in this press release are forward-looking statements and
are prospective in nature. Forward-looking statements are not based
on historical facts, but rather on current expectations and
projections about future events, and are therefore subject to risks
and uncertainties which could cause actual results to differ
materially from the future results expressed or implied by the
forward-looking statements, including: the receipt of all necessary
regulatory approvals, capital expenditures and other costs,
financing and additional capital requirements, ability to secure
additional sales, ability to negotiate partnerships on favorable
terms, and user acceptance of the improved UI. These
statements generally can be identified by the use of
forward-looking words such as "may", "should", "will", "could",
"intend", "estimate", "plan", "anticipate", "expect", "believe'' or
"continue", or the negative thereof or similar variations.
Forward-looking statements in this news release include statements
regarding: expansion of the Killi application outside of
North America; introduction of an
additional third-party research engine in the Killi application;
increasing ARPU for Killi; addition of incentivized video modules
to the Killi application; improvement of the Killi UI; improvement
of the engagement and user retention; securing an international
data distribution deal; expansion of Freckle's global presence;
securing additional partnerships in Q4; quarter over quarter
revenue growth in Q4; sustaining current recurring revenue;
building Killi into a legal global DTC application for Data
Privacy; and, improving key data metrics. Although management of
the Corporation has attempted to identify important factors that
could cause actual results to differ materially from those
contained in forward-looking statements or forward-looking
information, there may be other factors that cause results not to
be as anticipated, estimated or intended. There can be no assurance
that such statements will prove to be accurate, as actual results
and future events could differ materially from those anticipated in
such statements. Accordingly, readers should not place undue
reliance on forward-looking statements and forward-looking
information. The Corporation assumed no obligation to update any
forward-looking statements or forward-looking information that are
incorporated by reference herein, except as required by applicable
securities laws.
The securities of the Corporation have not been and will not be
registered under the United States Securities Act of 1933, as
amended and may not be offered or sold in the United States absent registration or an
applicable exemption from registration requirement. This press
release shall not constitute an offer to sell or the solicitation
of an offer to buy nor shall there be any sale of the securities in
any jurisdiction in which such offer, solicitation or sale would be
unlawful.
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SOURCE Freckle Ltd.