Conference call will be held on November 30, 2023, at 11AM
ET.
VANCOUVER, British Columbia,
Nov. 30,
2023 /CNW/ -- Zoomd Technologies Ltd. (TSXV:
ZOMD) (OTC: ZMDTF) and its wholly owned subsidiary Zoomd Ltd.
(collectively, "Zoomd" or the "Company"), the
marketing technology (MarTech) user-acquisition and engagement
platform, today reported its financial results for the three and
nine month periods ended September 30,
2023. The Company's financial statements and management
discussion and analysis ("MD&A") are available on SEDAR
under the Company's profile. All currency references in this press
release are in USD.
Third Quarter Financial Highlights
- Revenues were $7.1M, a 27%
decline versus 3Q22, primarily due to lower revenues from
the cryptocurrency sector and Zoomd's decision to
discontinue unprofitable activities.
- Gross Margins increased roughly 900 basis points to 40%, versus
3Q22, reflecting lower revenues from
the cryptocurrency sector, and
discontinuation of unprofitable activities which carries lower
margins.
- Total operating expenses decreased 36% versus 3Q22 as the
Company implements its cost saving initiatives and costs saving
measures.
- Adjusted EBITDA(1)
increased to $575,000 or 8% of
sales, versus $15,000 in
3Q22.
- Positive cash flow generated from operating activities for the
first time in 5 consecutive quarters.
(1) Adjusted EBITDA is a Non-GAAP performance measure.
Refer to "CAUTION REGARDING NON-IFRS FINANCIAL MEASURES" for
further details.
Management Commentary
Amit Bohensky, Chairman of Zoomd
Technologies, stated, "During the third quarter we made tremendous
strides in improving our margins and bottom line, growing our
Adjusted EBITDA to $575,000 versus
$15,000 in last year's period and
achieved positive cash flow from operating activities for the first
time in 5 consecutive quarters. The acceleration in probability is
the direct result of the implementation of our restructuring
initiatives and cost saving measures, which we initially disclosed
in June. These initiatives were designed to optimize our operations
and financial performance. As part of this process, we discontinued
various unprofitable areas of our business, resulting in operating
expenses decreasing by 36% in the third quarter. We will channel
our resources towards activities and solutions that have
demonstrated profitability, enabling us to better position
ourselves competitively in the current market.
We expanded our gross margins by approximately 900 basis points
during the third quarter, largely as the result of our business
transitioning away from cryptocurrency customers which
carried lower margins. In addition, we discontinued some
non-profitable areas of our business. While these items contributed
to our revenue decline of 27% in the quarter, gross profit dollars
only declined by 8%.
We remain cautious yet optimistic regarding the advertising
technology space. Historically, companies tend to cut their
advertising budgets during periods of economic uncertainty as a
cost-saving measure. However, when the business environment becomes
more stable and secure, companies often increase their advertising
investment to regain market share."
Third Quarter 2023 Highlights
- Revenues for the three months ended September 30, 2023, were $7.1 million, a 27% decline relative to 3Q22.
Revenues continued to be negatively affected by the global
slowdown, in particular the areas
of cryptocurrencies. We continue to diversify our
business by increasing our exposure to sectors such as E-commerce,
iGaming, transportation, and consumer product goods as well as
offering a wider range of performance based products and services.
Furthermore, our decision to discontinue unprofitable areas,
including our publishers' monetization business, led to a decline
in revenue. Excluding both Cryptocurrency clients and
non profitable operations clients that have been discontinued
revenue in 3Q23 have risen in comparison to the corresponding
period last year.
- Gross profit margin was 40% for the three months ended
September 30, 2023, versus 31% for
the same period last year. The 900 basis point increase was due to
lower revenues from the cryptocurrency
customers, which carry lower margins. In addition, the
company exited certain non profitable areas of its
business.
- Research and Development expenses for the three months ended
September 30, 2023, were $0.7M, a 49% decrease relative to Q3 2022.
Selling, General and Administrative expenses for the three months
ended September 30, 2023, were
$2.2M, a 30% decrease relative to Q3
2022. This decline in expenses was mainly the result of our cost
savings restructuring initiatives, mainly reflect the impact of 40%
reduction in headcount.
- Adjusted EBITDA for the three months ended September 30, 2023, was $575,000 as compared with Adjusted EBITDA of
$15,000 for the three months ended
September 30, 2022, reflecting cost
savings initiatives.
- Operating loss was $0.08M for Q3
2023, compared to an operating loss of $1.5M in Q3 2022, reflecting the cost savings
initiatives.
- Net cash of $0.2M was generated
from operating activities in 3Q23, reflecting positive cash
generation from operating activities for the first time in 5
consecutive quarters. As of September 30,
2023, the Company's cash and cash equivalents amounted to
$1.5 million, and no long-term
debt.
CONFERENCE CALL
Amit Bohensky, Founder and
Chairman, will hold a conference call to discuss the quarter's
financial results at 11AM ET on
November 30, 2023.
Interested parties can listen via a live webcast, from the link
available in the Investors section of Zoomd's website
at https://zoomd.com/investors/ or at
https://app.webinar.net/xyJNoQ9o8l7
A replay will be available after the call, in the Investors
section of the Company's website at
https://zoomd.com/investors/ or via
https://app.webinar.net/xyJNoQ9o8l7.
ABOUT ZOOMD:
Zoomd (TSXV: ZOMD) (OTC: ZMDTF), founded in 2012 and began
trading on the TSX Venture Exchange in September 2019, offers
a mobile app user-acquisition platform, integrated with many global
digital media outlets, to advertisers. The platform unifies more
than 600 media sources into one unified dashboard. Offering
advertisers a user acquisition control center for managing all new
customer acquisition campaigns using a single platform. By unifying
all these media sources onto a single platform, Zoomd saves
advertisers significant resources that would otherwise be spent
consolidating data sources, thereby maximizing data collection and
data insights while minimizing the resources spent on the exercise.
Further, Zoomd is a performance-based platform that allows
advertisers to advertise to relevant target audiences using a key
performance indicator-algorithm that is focused on achieving the
advertisers' goals and targets.
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the Exchange)
accepts responsibility for the adequacy or accuracy of this
release.
CAUTION REGARDING NON-IFRS FINANCIAL MEASURES
This press release refers to "Adjusted EBITDA" which is a
non-IFRS financial measure that does not have a standardized
meaning prescribed by IFRS. The Company's presentation of this
preliminary financial measure may not be comparable to similarly
titled measures used by other companies. This preliminary financial
measure is intended to provide additional information to investors
concerning the Company's estimated results. Adjusted EBITDA is
defined as earnings before interest, tax, depreciation and
amortization, as adjusted for share-based payments and one-time
non-operating expenses and is a measure of a company's operating
performance. Essentially, it's a way to evaluate a company's
performance without having to factor in financing decisions,
accounting decisions or tax environments.
Management uses this non-IFRS measure as a key metric in the
evaluation of the Company's performance and the consolidated
financial results. The Company believes Adjusted EBITDA is useful
to investors in their assessment of the operating performance and
the valuation of the Company. However, non-IFRS financial measures
are not prepared in accordance with IFRS, and the information is
not necessarily comparable to other companies and should be
considered as a supplement to, not a substitute for, or superior
to, the corresponding measures calculated in accordance with IFRS.
A reconciliation of Adjusted EBITDA and operating profit is
available in Zoomd's MD&A located on the Company's profile at
www.sedar.com which is incorporated by reference into this press
release.
DISCLAIMER IN REGARD TO FORWARD-LOOKING STATEMENTS
This news release includes certain "forward-looking statements"
under applicable Canadian securities legislation. Forward-looking
statements include, but are not limited to Zoomd's future outlook,
including as a result of the impact of general economic trends, its
future ability to successfully continue its growth, its ability to
improve profitability, as well as its ability to continue expanding
into new geographies and industries. Forward-looking statements are
based on our current assumptions, estimates, expectations and
projections that, while considered reasonable, are subject to known
and unknown risks, uncertainties, and other factors that may cause
the actual results and future events to differ materially from
those expressed or implied by such forward-looking statements. Such
factors include but are not limited to general business, economic,
competitive, technological, legal, privacy matters, political and
social uncertainties, the extent and duration of which are
uncertain at this time on Zoomd's business and general economic and
business conditions and markets. There can be no assurance that any
of the forward-looking 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, whether because of new information,
future events or otherwise, except as required by law.
The reader should not place undue importance on forward-looking
information and should not rely upon this information as of any
other date. All forward-looking information contained in this press
release is expressly qualified in its entirety by this cautionary
statement.
FOR FURTHER INFORMATION PLEASE CONTACT:
Company Media Contacts:
Amit Bohensky
Chairman
Zoomd
ir@zoomd.com
Website: www.zoomd.com
Investor relations:
Lytham Partners, LLC
Ben Shamsian
New York | Phoenix
ZOMD@lythampartners.com
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SOURCE Zoomd Technologies Ltd.