MVP MediaValet Inc

Achieves a 29% Increase in Revenue and 25% Increase in ARR

VANCOUVER, Nov. 22, 2018 /CNW/ - MediaValet Inc. (TSX-V:MVP) ("MediaValet" or the "Company"), a leading provider of enterprise cloud‐based digital asset management ("DAM") software, is pleased to report its results for the three and nine month periods ended September 30, 2018.

Summary of Quarterly Results

"We're extremely pleased with our year-to-date and 3^rd quarter performance," commented David MacLaren, founder and CEO of MediaValet. "We've achieved a lot over the past three quarters: we released V4, the industry's fastest 100% cloud-based DAM platform; we launched the first hybrid (desktop-to-sever-to-cloud) file-management solution for creative teams, Creative Spaces; and, we raised $8.6M in February, enabling us to significantly increase our go-to-market partner and direct sales and marketing programs. In our second quarter, we saw these efforts generate increased sales pipeline activity, and in Q3 we are now beginning to see the impact of these efforts in our top-line ARR and revenue numbers. In particular, our ARR is up 25% from last year to $3.15 million on third quarter net additions of $282,602, increasing 32% over Q3 last year and 20% sequentially. This represents nearly half of our net new business for the year, signalling the growth momentum we've been building toward."

Mr. MacLaren continued, "I'm also pleased to announce that we reached a major milestone in Q3; our Billings⁽⁵⁾ topped $1 million for the first time at a record $1.11 million - up 100% over Q3 last year and up 61% sequentially.  This is an important achievement for us, as it results in a significant reduction in our operating cash requirements and indicates a notable advance toward self-funding operations.  The increased Billings are a result of strong existing customer retention, particularly following the release of V4, and accelerated new customer acquisition with total new customer Billings increasing 23% over last year and 38% sequentially. As a result, we believe that our technology and operational milestones delivered this year are on the mark and have us well positioned to continue building a solid and sustained growth momentum in the quarters ahead."   

Results of Operations

Key Financial Metrics:

• Grew third quarter revenue to $0.77 million, up 29% from $0.59 million in Q3 2017, and up 11% sequentially. For the year-to-date ("YTD") period, revenue of $2.08 million was up 30% from $1.60 million last year-to-date. As over 90% of revenue is from annual subscriptions, the growth reflects the increasing ARR from by solid customer acquisition and retention. 
• Achieved a Gross Margin of 78% YTD, down from 83% last YTD. The decline is primarily due to duplicative data center costs being incurred during migration from the Company's V3 to V4 platform.  
• Incurred Operating Expenses of $1.45 million for Q3 2018, a 6% increase (restated 9%) from $1.37 million in Q3 last year, and an 8% sequential decrease. YTD Operating Expenses were $4.40 million, a 1% decrease over $4.43 million last YTD (restated +1%). The change from the prior year is due to increased spend on direct and partner sales and marketing programs following the equity financing completed in February 2018. This is offset by reductions in R&D following the completion of V4 development. Note that restated percentages are provided where applicable to provide the change from prior periods had IFRS 15 been applied with retroactive restatement. 
• Reported a Q3 2018 EBITDA loss of $0.86 million, a 1% decrease (restated +4%) from a EBITDA loss of $0.87 million in Q3 2017 and an 18% sequential decrease. For the YTD period, the EBITDA loss was $2.78 million, down 10% (restated 7%) from $3.10 million last YTD. The reduced losses reflect continued revenue growth as a result of the Company's growing recurring revenue base and efforts to manage operating cost levels. 
• Increased Annual Recurring Revenue ("ARR") to $3.15 million, an increase of 25% compared to $2.52 million at September 30, 2017, and a 10% sequential increase. The increased ARR is a result of efforts to maintain and grow the customer base through delivering must-have innovations (eg. V4, Advanced Search and Creative Spaces), and executing on our go-to-market strategy.   
• Ended the quarter with $68,001 of cash on hand (December 31, 2017 - $44,359), working capital of $0.19 million (December 31, 2017 – negative $1.70 million) and long term debt of $3.00 million (December 31, 2017 - $6.18 million).

Technology and Product:

• In September 2018, announced successful rollout of V4 to all existing customers, increasing customer value and user experience, while enabling a reduction in operating costs. V4 delivers industry leading platform and application speed and advanced search capabilities, resulting in increased user adoption metrics and opportunity win rate, and a doubling in MediaValet's developer community.   
• In June 2018, announced that Gartner, Inc. (NYSE:IT) (Gartner) named MediaValet in its 2018 Market Guide for Digital Asset Management, as one of nineteen Representative Vendors covering on-premises, cloud, hybrid and SaaS deployments. MediaValet was positioned as one of the most enterprise-grade, globally available DAM systems on the market.
• In May 2018, delivered a number of technology and product milestones including the launch of V4 for new customers and Creative Spaces for large, high volume creative teams, which management believes will materially increase the value delivered to customers, enable us to attract more new customers, and increase existing customer retention and expansion. These developments increased the enterprise class capability of the system – including providing unparalleled speed and search features – and provide unique integrations and features that solve critical customer issues and provide differentiation to MediaValet.

Operations and Corporate:

• Subsequent to quarter end (October 25, 2018), announced modification of the $3 million of secured senior debentures, reducing the interest rate to 7% (from 10%) and extending the maturity dates to November 7, 2021. 
• Provided an update on Creative Spaces (October 18, 2018), announcing that the new solution has received rave reviews from customers, Creative Directors and creatives, and is proving to be a major differentiator for MediaValet. Customers have indicated that it is successfully addressing the unique and long standing file management problems experienced by creative teams during the ideation and work-in-progress (WIP) stages of media production. Since its launch in May 2018, Creative Spaces has driven 17% (updated) of new subscription revenue year-to-date and the deal size has been 50% to 100% higher than average.
• Launched a new channel partnership (October 3, 2018) with Wrike, Inc., a leading collaborative work management platform for high performance teams, to deliver an all-in-one solution for marketing departments. Wrike has since created a full integration using MediaValet's industry leading API, and as of November 15^th, 2018 is offering it as a value-added solution to their 17,000 plus customer base as announced by Wrike here. This follows announcements on September 19th of MediaValet's channel program progress with a 2.25x increase in channel-generated sales and on September 20th of MediaValet winning Top Enterprise Solution at the 2018 Canadian Channel Innovation Awards.   
• Announced go-to-market progress in the Asia-Pacific region (August 16th) and with high-security conscious organizations (September 13th). As the only Cloud-DAM provider who can offer a data residency guarantee in Australia and New Zealand, and following the launch of targeted marketing programs, the region has grown to >5% of recurring revenue in the last year. In addition, positioned as one of the highest enterprise-grade Cloud-DAMS on the market, MediaValet is seeing strong adoption from security-focused and tightly regulated customer segments such as financial, government, healthcare and legal, which have accounted for 35% of new customer wins YTD in 2018.

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 in 140 countries, 54 Microsoft data center regions, 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 and local desktop-to-cloud support for creative teams, 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 3^rd party applications.

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SOURCE MediaValet Inc.