Quorum Information Technologies Inc. (“Quorum”), a leading provider
of innovative and robust technology solutions and services to
traditional and electric vehicle dealerships and Original Equipment
Manufacturers (“OEM”) across North America, released its results
for Q3 2020 today.
Q3 2020 total revenue of $8.1 million was a 36%
increase over Q2 2020 as one-time $1.8 million SaaS and BDC
COVID-19 discounts Quorum provided to its dealerships were
discontinued. Normalized SaaS revenue and BDC revenue without the
Q2 COVID-19 discounts would have shown an increase of 2.4% and 4.3%
respectively in Q3 over Q2 and puts Quorum back to 9.6% SaaS and
17.2% BDC annual revenue growth rates respectively. Quorum’s SaaS
and BDC recurring revenue streams represented 96% of its total Q3
revenue.
“We’d like to acknowledge all our employees and
customers who rose to the challenge of COVID-19 and were the
driving force behind the recovery of our business,” stated Maury
Marks, President and CEO. “In spite of these challenges, we were
able to drive SaaS and BDC revenue growth in the quarter and
tightly managed our cost structure to produce a record Adjusted
EBITDA of $1.5 million, or 18% of total revenue. Quorum’s new Chief
Operating Officer, Mike Herenberg, is focusing on our One Quorum
strategy and optimizing operations to drive stronger organic growth
and allow for more seamless acquisition integration.”
“Our development team continues to provide
innovative solutions including Autovance MyDeal and PowerLane for
our customers which will help increase our ‘share of wallet’ in the
future,” continued Marks. “Both MyDeal, a Digital Retailing
solution that helps dealership customers purchase a vehicle on-line
and PowerLane, a service lane inspection tool that also provides
videos and pictures to dealership customers of possible repairs to
their vehicles, have had strong initial sales to date. Our BDC
revenue will also see additional long-term growth as we deploy a
comprehensive electronic message handling solution for
AutoCanada.”
Third Quarter Results
- SaaS revenue was $5.9 million, an increase of 5% compared to Q3
2019.
- September SaaS revenue was $2.0 million, or a quarterly run
rate of $6.0 million.
- BDC revenue was $1.9 million, a decrease of 1%.
- Total revenue was $8.1 million, a decrease of 6%.
- Gross margin was $3.7 million, a decrease of 12%.
- Adjusted EBTIDA was $1.5 million, an increase of 3%.
Financial Summary
Three months
ended($000’s) |
September 30, 2020 |
September 30, 2019 |
SaaS revenue |
$5,914 |
|
$5,643 |
|
BDC revenue |
|
1,865 |
|
|
1,884 |
|
Services and one-time revenue |
|
306 |
|
|
1,047 |
|
Total revenue |
|
8,085 |
|
|
8,574 |
|
|
|
|
Cost of revenue |
|
4,425 |
|
|
4,392 |
|
|
|
|
Gross margin |
|
3,660 |
|
|
4,182 |
|
Gross margin percentage |
|
45% |
|
|
49% |
|
|
|
|
Adjusted EBITDA |
|
1,465 |
|
|
1,422 |
|
|
|
|
Adjusted cash income |
|
962 |
|
|
656 |
|
|
|
|
Net income (loss) |
$(358) |
|
$620 |
|
Recent Business Highlights
- In September 2020, DealerMine expanded its
BDC to a second location in St. John’s, NL to support accelerated
growth and improved customer satisfaction.
- In Q3 2020, Quorum launched remote installation and training
services for most of the Corporation’s products.
Outlook
“Quorum has seen recovery of new vehicle sales
at its customer dealerships and in September 2020 new light vehicle
sales were up 2.4% over September 2019 in Canada1. We have
experienced good sales momentum working through the headwinds
dealerships struggle with in obtaining new vehicle inventory from
OEMs and managing COVID-19 economics,” said Maury Marks.
“Quorum is extremely well capitalized to support our strategy of
growing organically and through acquisitions to ensure our product
suite is highly relevant for dealerships as they navigate these
difficult times.”
Quorum Q3 2020 Results Webcast, Conference Call Details
and Investor Presentation
Webcast Link: |
Quorum Q3 2020 Results Webcast |
|
https://quoruminformationsystems.com/#presentations-events |
|
|
|
Date: |
Thursday, November 19, 2020 |
Time: |
11:00 am MST (please dial-in by 10:55 am) |
Dial-In #: |
Local: |
1 (403) 451-9838 |
|
Toll-Free North America: |
1 (888) 231-8191 |
|
|
|
A replay of the conference call will be
available: |
|
|
|
Date: |
Thursday November 19, 2020, after 2:00 pm MST |
Replay Dial-In #: |
Local: |
1 (403) 451-9481 |
|
Toll-Free North America: |
1 (855) 859-2056 |
|
Password#: |
1675468 |
The Q3 2020 Quarterly Results Investor Presentation and a replay
of the conference call will also be available at
www.QuorumInformationSystems.com.
Forward Looking Information
This report contains certain forward-looking
information and statements within the meaning of applicable
securities laws. All statements in this report, other than
statements of historical fact, which address events or developments
concerning Quorum Information Technologies Inc. ("Quorum" or the
“Corporation”) that Quorum expects to occur are "forward-looking
information and statements". The use of any of the words "expect",
"anticipate", "continue", "estimate", "objective", "ongoing",
"may", "will", "project", "should", "potential", "could",
"scheduled", "believe", "plans", "intends", "might" and similar
expressions are intended to identify forward-looking information or
statements.
In particular, but without limiting the
foregoing, this document may contain forward-looking information
and statements pertaining to the following: business plan of Quorum
including its plans for targeting new Original Equipment
Manufacturer (“OEM”) Integration, new dealership rooftop sales, and
increasing Automotive Group Partnerships; the timing for completion
and cost of OEM integration; estimates of return on assets and
EBITDA; potential merger and acquisition (“M&A”) opportunities;
the timing of adoption of new accounting standards and the
potential impact of new accounting standards on the Corporation’s
financial statement; the effect of acquisitions on the Corporation
including the effect of the Autovance, DealerMine and Oasis
acquisitions; the effect of the BDC Capital facility; the effect of
the Corporation’s private placement financing; the effect of
COVID-19 on industry activity and economic activity in North
America as a whole; various industry activity forecasts; growth
opportunities including those in the United States; anticipated
requirements by OEM manufacturers relating to integrations and
certifications; and other expectations, beliefs, plans, goals,
objectives, assumptions, information and statements about possible
future events, conditions, results of operations or performance.
Various assumptions were used in drawing the conclusions or making
the forecasts and projections contained in the forward-looking
statements throughout this report. The forward-looking information
and statements contained in this report reflect several material
factors, expectations and assumptions including, without
limitation: (i) capital expenditures by dealers; (ii) market
availability of current and future dealership rooftops; (iii)
schedules and timing of certain projects and Quorum's strategy for
growth; (iv) Quorum's future operating and financial results; and
(v) treatment under governmental regulatory regimes and tax and
other laws. The forward-looking information and statements included
in this report are not guarantees of future performance and should
not be unduly relied upon.
Forward-looking statements are based on current
expectations, estimates and projections that involve a number of
risks and uncertainties, which could cause actual results to differ
materially from those anticipated and described in the
forward-looking information and statements. Such information and
statements involve known and unknown risks, uncertainties and other
factors that may cause actual results or events to differ
materially from those anticipated in such forward-looking
information or statements including, without limitation: (i)
volatility in exchange rates for the Canadian dollar relative to
the US dollar; (ii) liabilities and risks inherent in the software
services industry; (iii) competition for, among other things,
capital and skilled personnel; (iv) changes in general economic,
market and business conditions in Canada and the United States; and
(v) actions by governmental or regulatory authorities including
changes in income tax laws or changes in tax laws. Quorum cautions
that the foregoing list of assumptions, risks and uncertainties is
not exhaustive. The forward-looking information and statements
contained in this document speak only as of the date of this
document, and Quorum assumes no obligation to update or revise them
to reflect news events or circumstances, except as may be required
pursuant to applicable laws. Any financial outlook or future
oriented financial information in this document, as defined by
applicable securities legislation, has been approved by management
of Quorum. Such financial outlook or future oriented financial
information is provided for the purpose of providing information
about management's current expectations and plans relating to the
future. Readers are cautioned that reliance on such information may
not be appropriate for other purposes.
About Quorum Information Technologies
Inc.
Quorum is a North American company focused on
developing, marketing, implementing and supporting its portfolio of
software and services for automotive dealerships that includes:
- XSellerator, a Dealership Management System (DMS) that
automates, integrates and streamlines key processes across
departments in a dealership, and emphasizes revenue generation and
customer satisfaction.
- DealerMine CRM, a sales and service Customer Relationship
Management (CRM) system and set of Business Development Centre
services that drives revenue into the critical sales and service
departments in a dealership.
- Autovance, a modern retailing platform that helps dealerships
attract more business through Digital Retailing (DR), improve
in-store profits and closing rates through its desking tool and
maximize their efficiency and CSI through Autovance’s F&I menu
solutions fee.
- Advantage, a full showroom system for both franchised and
independent dealerships and a comprehensive management system that
includes accounting for the independent market.
Quorum has filed its Q3 2020 unaudited condensed
consolidated financial statements and notes thereto for the period
ended September 30, 2020, and accompanying management and
discussion and analysis in accordance with National Instrument
51-102 - Continuous Disclosure Obligations adopted by the Canadian
securities regulatory authorities.
Quorum Information Technologies Inc. is traded
on the Toronto Venture Exchange (TSX-V) under the symbol QIS. For
additional information please go to
www.QuorumInformationSystems.com.
Neither the TSX Venture Exchange nor its
regulation services provider (as that term is defined in the
policies of the TSX Venture Exchange) has reviewed this release and
neither accepts responsibility for the adequacy or accuracy of this
release.
Contact: Maury
Marks403-777-0036Investors@QuorumDMS.com
1 As per Desrosiers automotive consultants Provincial Sales
report.
PDF
available: http://ml.globenewswire.com/Resource/Download/fc97fce8-9e38-4c36-85ea-0b2bb1e7d6a1
Quorum Information Techn... (TSXV:QIS)
Historical Stock Chart
From Jun 2024 to Jul 2024
Quorum Information Techn... (TSXV:QIS)
Historical Stock Chart
From Jul 2023 to Jul 2024