TrackX Reports First Quarter of Fiscal 2020
May 06 2020 - 3:47PM
TrackX Holdings Inc. (TSX.V:TKX | OTC:
TKXHF | FRANKFURT:3TH) (“TrackX” or the “Company”), a
SaaS-based enterprise asset management solution provider, announces
the financial and operational highlights from its first quarter of
fiscal 2020 ended December 31, 2019. All results are reported in
Canadian dollars unless otherwise specified. A complete set of the
December 31, 2019 Consolidated Financial Statements and
Management’s Discussion & Analysis has been filed on SEDAR
(www.sedar.com).
Financial Highlights for the 3-Months
Ended December 31, 2019
- Recurring revenue increased 28% over the previous year period
and 3% over the prior quarter to $731,123;
- Quarterly revenue of $1.18 million versus $2.19 million in the
year-ago quarter (46% decrease); largely resulting from a strategic
reduction in both traditional enterprise software licensing revenue
and hardware revenue;
- Gross margin of 49% compared to 40% in the year-ago quarter,
resulting from the Company’s focus on higher margin recurring SaaS
revenue;
- Adjusted EBITDA loss of $192,000 compared to a $295,165 loss in
Q1 FY19; and
- Net operating loss of $0.75 million versus a $0.82 million loss
in Q1 FY19.
First Quarter FY20 Revenue
Mix
Revenue |
Q1 FY20 |
Q1 FY19 |
Recurring |
62% |
26% |
Perpetual Software License |
0% |
10% |
Hardware |
9% |
23% |
Setup, implementation, and other fees |
29% |
37% |
Services |
0% |
4% |
TOTAL |
100% |
100% |
Operational Highlights for the 3-Months
Ended December 31, 2019
- Completed an additional installation of GAME (Global Asset
Management for Enterprises) for a global household appliance
manufacturer;
- Successfully installed GAME at two additional Carvana vehicle
inspection and processing centers;
- Expanded the GAME solution footprint and automation of
additional business processes for a large national insurance
company;
- Successfully completed the phase 1 implementation of GAME to
manage vehicles for a global powersports leader; and
- Entered into a letter of intent with FourKites, Inc for the
purchase of the TrackX Yard Management line of business; this
strategic transaction was subsequently completed and announced on
March 24, 2020.
Management Commentary
“In Q1, 2020, TrackX further refined its
solution focus on the growth of highly repeatable, high margin
SaaS-based solutions in the supply chain and enterprise asset
management industries. As a result, the company made a strategic
decision to sell the Yard Management line of business. That lead
the Company to sign a letter of intent with FourKites, the
Chicago-based creator of the predictive supply chain visibility
category, for the sale of the TrackX Yard Management business. This
strategic transaction was subsequently closed in Q2 2020 and
announced on March 24, 2020,” said CEO Tim Harvie. “During the
quarter, we continued to execute on our core strategies with new
partners added to our ecosystem, additional expansion within our
current customer base, numerous extensions and functional
enhancements to our GAME platform, and an increase in recurring
revenue, our core metric.”
Selected Financial Information
C$(000s) (except per share) |
Three-month Period Ended December 31 |
|
|
2020 |
|
|
2019 |
|
Revenue |
$1,177 |
|
$2,188 |
|
Gross Margin % |
|
49% |
|
|
40% |
|
Net comprehensive loss for the period |
($1,496) |
|
($698) |
|
Loss per share |
($0.02) |
|
($0.01) |
|
Adjusted EBITDA (Loss)* |
($192) |
|
($295) |
|
* Adjusted EBITDA is a non-IFRS (international financial reporting
standards) measure and excludes stock-based compensation |
Business Outlook
TrackX has remained consistent in its focus to
execute on its core strategies. The Company’s land and expand
strategy resulted in multiple solution implementations during the
quarter. Expansion within our existing client base during the
quarter and additional deployments beyond include:
- Global household appliance manufacturer: Completed an
additional implementation of GAME for Supply Chain Management
(SCM), bringing the total number of implementations for this
customer to 10.
- Carvana: Continued solution expansion and completed the
installation of the GAME platform at two additional vehicle
inspection centers (IC’s), bringing the implementation to a total
of 10 IC’s.
- Global Powersports leader: Completed phase 1 of the GAME
implementation to manage the inventory of recreational vehicles.
Discussions are underway regarding phase 2 functional
requirements.
- National insurance company: Expanded the GAME solution
footprint and automated additional business processes across
multiple administrative buildings.
The Company will narrow its focus in returnable
asset tracking, high value asset tracking (i.e., IT asset tracking)
and supply chain management. COVID-19 has brought with it many
global challenges across every industry and within every community.
Companies need now, more than ever, to gain supply chain visibility
and improve supply chain efficiency. This need to eliminate the
black holes in the supply chain, protect against product tampering,
eliminate theft, maintain a clear chain of custody, ensure product
quality and obtain proof of delivery has resulted in supply chain
initiatives moving closer to the top of the priority list for many
companies. With a proven, enterprise scalable, IOT hardware
agnostic, blockchain-enabled supply chain platform, TrackX expects
to not only see an increase in pipeline activity, but to also see
opportunities close more quickly over the subsequent quarters.
To increase delivery capacity and more
effectively respond to industry opportunities, TrackX will continue
to develop its partner network. Not only will new partners, like
FourKites, continue to be added to the TrackX ecosystem, but
additional improvements to joint sales and marketing collaboration
with partners are expected to fuel additional growth in pipeline
activity, and growth in high margin recurring SaaS revenue.
About TrackX
TrackX Holdings, Inc., based in Denver,
Colorado, is an enterprise asset management company deploying
SaaS-based solutions leveraging multiple auto-ID and sensor
technologies for the comprehensive tracking and management of
physical assets. TrackX's Global Asset Management for Enterprises
(GAME) platform enables the Industrial Internet of Things (IIoT) by
providing unique item level tracking, workflow processing, event
management, alerting and powerful analytics to deliver solutions
across a growing number of industries. TrackX delivers significant
value to a growing list of Fortune 500 companies and for customers
in industries such as transportation, beverage, brewery,
healthcare, hi-tech, hospitality, mining, agriculture,
horticulture, manufacturing and government.
For more information, please
contact:
Gene McConnell, TrackX Holdings
Inc. investor@trackx.com 303-325-7300
Neither TSX Venture Exchange nor its
Regulations Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this
release.
CAUTIONARY STATEMENT REGARDING
FORWARD-LOOKING INFORMATION: This news release includes
certain “forward-looking statements” under applicable Canadian
securities legislation. Forward looking statements are necessarily
based upon a number of estimates and assumptions that,
while considered reasonable, are subject to known and unknown
risks, uncertainties, and other factors which may cause the actual
results and future events to differ materially from those expressed
or implied by such forward-looking statements. All statements that
address future plans, activities, events or developments that the
Company believes, expects or anticipates will or may occur
including the Company’s anticipated pipeline and value of current
and customer deployments and future opportunities are the
managements best estimates and cannot be guaranteed or relied upon
and is forward-looking information. 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. The Company disclaims any
intention or obligation to update or revise any forward-looking
statements in this news release, whether as a result of new
information, future events or otherwise, except as required by
law.
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