TORONTO, April 29, 2021 /CNW/ - NexJ Systems
Inc. (TSX: NXJ), delivering intelligent customer management
software to the financial services industry, today announced
financial results for its first quarter ended March 31, 2021.
First Quarter Summary
- $3.93M of revenue for the first
quarter as compared to $3.98M in the
first quarter of the previous year
- $96K in Adjusted EBITDA profit
for the first quarter is a $1.43M
improvement over Adjusted EBITDA loss of $1.33M in the previous year
- $283K of net loss for the first
quarter is a $971K improvement over
$1.25M of net loss in the first
quarter of the previous year
- Cash balance increased by $2.5M
to $7.9M at the end of the
quarter
- Established three strategic partnerships:
-
- AdvisorStream to deliver our Inform product that enables
hyper-personalized content to drive improved client acquisition,
engagement and retention resulting in greater share of wallet.
Click here for more information
- Bill Good Marketing as a reseller of NexJ's cloud-based CRM for
wealth management creating opportunities for firms of all sizes to
take advantage of our deep vertical product functionality to
achieve their growth objectives. Click here for more
information
- Sand Hill East LLC, to identify incremental sales opportunities
and leverage their business development capabilities in the
financial services market to drive revenue acceleration. Click here
for more information
"Many of the world's most recognized financial services firms
continue to benefit from our solutions. This underpins our ability
to generate revenue as we commercialize new products," said
Paul O'Donnell, CEO of NexJ
Systems. "We remain committed to expanding our go-to-market
initiatives, as evidenced by our new partnerships, and our
expectation is that these new initiatives will contribute to our
goal of increasing our subscription license revenue this year and
beyond."
NexJ Systems
Inc.
|
First Quarter
Financial Results
|
(Expressed in
thousands of Canadian dollars)
|
(Unaudited)
|
|
|
|
|
Quarter
ended
|
|
Quarter
ended
|
|
March 31,
2021
|
|
March 31,
2020
|
|
|
|
|
Revenue
|
$
|
|
$
|
License and
subscription fees
|
43
|
|
24
|
Professional
services
|
1,800
|
|
1,671
|
Maintenance and
support
|
2,093
|
|
2,286
|
|
3,936
|
|
3,981
|
Cost of
revenue
|
1,063
|
|
1,331
|
Gross
profit
|
2,873
|
|
2,650
|
|
|
|
|
Operating
Expenses
|
|
|
|
Research and
development
|
1,395
|
|
2,002
|
Sales and
marketing
|
565
|
|
787
|
General and
administrative
|
817
|
|
1,194
|
|
2,777
|
|
3,983
|
|
|
|
|
Adjusted
EBITDA
|
96
|
|
(1,333)
|
|
|
|
|
Share-based payment
expense
|
37
|
|
71
|
Depreciation and
amortization
|
218
|
|
211
|
Loss from
operations
|
(159)
|
|
(1,615)
|
|
|
|
|
Foreign exchange loss
(gain)
|
100
|
|
(373)
|
Finance
income
|
(3)
|
|
(24)
|
Finance
expense
|
27
|
|
36
|
Net
Loss
|
(283)
|
|
(1,254)
|
Non-IFRS Measures
This news release includes certain
measures that have not been prepared in accordance with
International Financial Reporting Standards ("IFRS") such as
Adjusted EBITDA and Adjusted EBITDA margin which are used to
evaluate the Company's operating performance as a complement to
results provided in accordance with IFRS. The Company believes that
Adjusted EBITDA and Adjusted EBITDA margin are useful supplemental
information as it provides an indication of the results generated
by the Company's main business activities prior to taking into
consideration how those activities are financed and taxed and also
prior to taking into consideration asset depreciation and the other
items listed below.
The term "Adjusted EBITDA" refers to net income (loss) before
adjusting for share-based payment expense, depreciation and
amortization, deferred share unit expense, restructuring costs,
foreign exchange gain (loss), finance income, finance costs, and
income taxes. "Adjusted EBITDA margin" refers to the percentage
that Adjusted EBITDA for any period represents as a portion of
total revenue for that period.
The term Adjusted EBITDA and Adjusted EBITDA margin are not
measures recognized by IFRS and do not have standardized meanings
prescribed by IFRS. Therefore, Adjusted EBITDA and Adjusted EBITDA
margin may not be comparable to similar measures presented by other
issuers. Investors are cautioned that Adjusted EBITDA and Adjusted
EBITDA margin should not be construed as an alternative to net
income (loss) as determined in accordance with IFRS.
About NexJ Systems Inc.
NexJ Systems provides
Intelligent Customer Management to the financial services industry.
Our award-winning CRM is designed to help Wealth Management,
Private Banking, Corporate and Commercial Banking, and Insurance
firms revolutionize their business. Powered by artificial
intelligence, our products help drive productivity, boost client
engagement, and increase revenue. With users in over 60 countries,
our customers benefit from our deep expertise across financial
services verticals, strategic investment in innovation, and
commitment to their success.
Based in Toronto, NexJ has
clients throughout North America,
Asia Pacific and in Europe. For more information about NexJ
visit www.nexj.com, e-mail info@nexj.com, or call
416-222-5611. Join us on LinkedIn, follow us on Twitter, subscribe
to our YouTube channel, or like us on Facebook.
NexJ Forward-looking Statement
Certain statements in this press release, including statements
about the financial conditions, and results of operations and
earnings, may contain words such as "may", "will", "expect",
"anticipate", "aim", "estimate", "intend", "plan", "seek",
"believe", "potential", "continue", "is/are likely to", "could",
"should", "target", "envision", and other similar language and are
considered forward-looking statements or information under
applicable securities laws. These statements are based on the
Company's current expectations, estimates, forecasts and
projections about the operating environment, economies and markets
in which the Company operates. These statements are subject to
important assumptions, risks and uncertainties that are difficult
to predict, and the actual outcome may be materially different. The
Company's assumptions, although considered reasonable by the
Company at the date of this press release, may provide to be
inaccurate and consequently the Company's actual results could
differ materially from the expectations set out herein.
Actual results or events could differ materially from those
contemplated in forward-looking statements as a result of the
following: (i) the future performance, financial and otherwise, of
NexJ; (ii) the ability of NexJ to protect, maintain and enforce its
intellectual property rights; (iii) the acceptance by the Company's
customers and the marketplace of new technologies and solutions;
(iv) the Company's growth and profitability prospects; (v) the
estimated size and growth prospects of the CRM market; (vi) the
Company's competitive position in the CRM market and its ability to
take advantage of future opportunities in this market; (vii) the
Company's ability to attract new customers and develop and maintain
existing customers; and (viii) the demand for the Company's product
and the extent of deployment of the company's products in the CRM
marketplace. Forward-looking statements may also include, without
limitation, any statement relating to future events, conditions or
circumstances.
The risks and uncertainties that may affect forward-looking
statements include, but are not limited to: (i) our dependence on a
limited number of customers and large project size; (ii)
fluctuation in our quarterly operating results; (iii) our
dependence on key personnel and our compensation structure; (iv)
risks associated with managing large and complex software
implementation projects; (v) uncertainties and assumptions in our
sales forecasts, including the extent to which sales proposals are
converted into sales; (vi) risks associated with our ability to
design, develop, test, market, license and support our software
products on a timely basis; (vii) market acceptance of our products
and services; (viii) commercial success of products resulting from
our investment in research and development; (ix) our success in
expanding sales into new international markets; * competition in
our industry; (xi) failure to protect our intellectual property or
infringement of intellectual property rights of third parties;
(xii) reliance upon a limited number of third-party software
products to develop our products; (xiii) defects or disruptions in
our products and services; (xiv) currency exchange rate
fluctuations; (xv) lengthy sales cycles for our software; (xvi)
general economic conditions; (xvii) failure to manage our growth
successfully; (xviii) failure to successfully manage and integrate
acquisitions; (xix) breach of our security measures and
unauthorized access to data; (xx) employee retention and (xxi)
litigation, including commercial, product liability, employment,
class action and other litigation and claims.
For additional information with respect to risks and other
factors which could occur, see the Company's most recently filed
Annual Information Form for the year ended December 31, 2020 dated February 18, 2021, and other securities filings
with the Canadian securities regulators available on www.sedar.com.
Unless otherwise required by applicable securities laws, the
Company disclaims any intention or obligations to update or revise
any forward-looking statements, whether as a result of new
information, future events or otherwise.
NexJ
Systems Inc.
|
Condensed Interim
Statements of Financial Position
|
(Expressed in
thousands of Canadian dollars)
|
(Unaudited)
|
|
|
|
|
|
March 31,
2021
|
|
December 31,
2020
|
|
|
|
|
Assets
|
|
|
|
|
$
|
|
$
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
7,945
|
|
5,426
|
Accounts
receivable
|
1,088
|
|
3,546
|
Prepaid expenses and
other assets
|
1,370
|
|
1,320
|
Total current
assets
|
10,403
|
|
10,292
|
|
|
|
|
Non-current
assets:
|
|
|
|
Property and
equipment
|
744
|
|
768
|
Right-of-use
assets
|
1,342
|
|
1,280
|
Goodwill
|
1,753
|
|
1,753
|
Investments
|
252
|
|
255
|
Contract
costs
|
43
|
|
51
|
Other
assets
|
368
|
|
403
|
Total non-current
assets
|
4,502
|
|
4,510
|
|
|
|
|
Total
assets
|
14,905
|
|
14,802
|
|
|
|
|
Liabilities and
Shareholders' Equity
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts payable and
accrued liabilities
|
1,813
|
|
1,874
|
Deferred
revenue
|
6,184
|
|
5,374
|
Lease
liabilities
|
1,067
|
|
967
|
Total current
liabilities
|
9,064
|
|
8,215
|
|
|
|
|
Non-current
liabilities:
|
|
|
|
Accrued
liabilities
|
76
|
|
101
|
Deferred
revenue
|
-
|
|
346
|
Lease
liabilities
|
952
|
|
1,078
|
Total non-current
liabilities
|
1,028
|
|
1,525
|
|
|
|
|
Total
liabilities
|
10,092
|
|
9,740
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
Share
capital
|
83,471
|
|
83,471
|
Share purchase
loans
|
(3,598)
|
|
(3,598)
|
Contributed
surplus
|
8,701
|
|
8,664
|
Accumulated other
comprehensive loss
|
(17)
|
|
(14)
|
Deficit
|
(83,744)
|
|
(83,461)
|
Total shareholders'
equity
|
4,813
|
|
5,062
|
|
|
|
|
Total liabilities and
shareholders' equity
|
14,905
|
|
14,802
|
NexJ Systems
Inc.
|
Condensed Interim
Statements of Comprehensive Loss
|
(Expressed in
thousands of Canadian dollars, except per share amounts)
|
(Unaudited)
|
|
|
|
|
|
Quarter
ended
|
|
Quarter
ended
|
|
March 31,
2021
|
|
March 31,
2020
|
|
|
|
|
Revenue
|
$
|
|
$
|
License and
subscription fees
|
43
|
|
24
|
Professional
services
|
1,800
|
|
1,671
|
Maintenance and
support
|
2,093
|
|
2,286
|
|
3,936
|
|
3,981
|
Cost of
revenue
|
1,068
|
|
1,347
|
Gross
profit
|
2,868
|
|
2,634
|
|
|
|
|
Expenses:
|
|
|
|
Research and
development
|
1,403
|
|
2,018
|
Sales and
marketing
|
566
|
|
790
|
General and
administrative
|
1,058
|
|
1,441
|
|
3,027
|
|
4,249
|
|
|
|
|
Loss from
operations
|
(159)
|
|
(1,615)
|
|
|
|
|
Foreign exchange gain
(loss)
|
(100)
|
|
373
|
Finance
income
|
3
|
|
24
|
Finance
expense
|
(27)
|
|
(36)
|
|
(124)
|
|
361
|
|
|
|
|
|
|
|
|
Loss for the
period
|
(283)
|
|
(1,254)
|
|
|
|
|
Other
comprehensive income (loss):
|
|
|
|
Items that will not
be reclassified to profit or loss:
|
|
|
|
Unrealized gain (loss)
on equity securities
|
(3)
|
|
24
|
Loss for the
period
|
|
|
|
and comprehensive
loss
|
(286)
|
|
(1,230)
|
|
|
|
|
Loss per
share
|
|
|
|
Basic and
diluted
|
(0.01)
|
|
(0.06)
|
|
|
|
|
Weighted average
number of common shares
|
|
|
|
outstanding, in
thousands
|
|
|
|
Basic and
diluted
|
21,055
|
|
20,677
|
NexJ Systems
Inc.
|
Condensed Interim
Statements of Cash Flows
|
(Expressed in
thousands of Canadian dollars)
|
(Unaudited)
|
|
|
|
|
|
Quarter
ended
|
|
Quarter
ended
|
|
March 31,
2021
|
|
March 31,
2020
|
|
|
|
|
|
|
|
|
Cash flows from
(used in) operating activities:
|
$
|
|
$
|
Loss for the
period
|
(283)
|
|
(1,254)
|
Adjustments
for:
|
|
|
|
Depreciation and
amortization of property and equipment
|
56
|
|
72
|
Depreciation of
right-of-use assets
|
162
|
|
139
|
Changes in contract
costs
|
8
|
|
31
|
Share-based payment
expense
|
37
|
|
71
|
Finance
income
|
(3)
|
|
(24)
|
Finance
expense
|
27
|
|
36
|
Foreign exchange loss
(gain)
|
54
|
|
(102)
|
Change in non-cash
operating working capital:
|
|
|
|
Accounts
receivable
|
2,458
|
|
4,483
|
Prepaid expenses and
other assets
|
(13)
|
|
(68)
|
Accounts payable and
accrued liabilities
|
(117)
|
|
(26)
|
Deferred
revenue
|
461
|
|
739
|
Net cash flows
from operating activities
|
2,847
|
|
4,097
|
|
|
|
|
Cash flows used in
financing activities:
|
|
|
|
Payment of lease
liabilities
|
(276)
|
|
(60)
|
Interest
paid
|
(1)
|
|
-
|
Net cash flows
used in financing activities
|
(277)
|
|
(60)
|
|
|
|
|
Cash flows from
(used in) investing activities:
|
|
|
|
Purchase of property
and equipment
|
-
|
|
(71)
|
Interest
received
|
3
|
|
24
|
Net cash flows
from (used in) investing activities
|
3
|
|
(47)
|
|
|
|
|
Effects of exchange
rates on cash and cash equivalents
|
(54)
|
|
102
|
|
|
|
|
Increase in cash and
cash equivalents
|
2,519
|
|
4,092
|
|
|
|
|
Cash and cash
equivalents, beginning of period
|
5,426
|
|
5,123
|
|
|
|
|
Cash and cash
equivalents, end of period
|
7,945
|
|
9,215
|
|
|
|
|
Supplemental cash
flow information:
|
|
|
|
Acquisition of
property and equipment not yet paid
|
32
|
|
1
|
SOURCE NexJ Systems Inc.