TSX: MDF
www.mediagrif.com
Highlights:
- Acquisition of kCentric Technologies inc. completed on
December 3 rd, 2019; - 5-year strategic plan now completed and launched;
- Total revenues, excluding those from B2C marketplaces amount to
$17.1 million , a rise of 1.5%; - Adjusted EBITDA1 of
$ 1.6 million or 9% of revenue before non-recurring expenses of 1.4 M $; - Net loss of
$1.9 million , i.e.,$ (0.13) per share.
"We're pleased to announce that our third quarter results are in line with our forecast." said
5-YEAR STRATEGIC PLAN
Following a thorough strategic review process, conducted by the management team under the leadership of
This plan aims to transform Mediagrif in line with its new vision of becoming a fast growing, cloud-based commerce technology company with a SaaS business model.
Mediagrif's 5-year strategy is built around three main pillars of growth:
- E-Commerce
- Strategic Sourcing
- Supply Chain Collaboration
________________________ |
1 See the Reconciliation of adjusted EBITDA and profit as well as the "About |
2 Unless otherwise indicated, all amounts are in Canadian dollars. |
As for Mediagrif's e-marketplaces, they continue to perform well and generate appreciable profitability although with less growth opportunity.
These three growth pillars operate in markets having respective compounded annual growth rates of 15, 12 and 11 %. Mediagrif has conducted detailed market studies in each of these sectors. The results show that there is considerable growth to be captured in each of these markets and Mediagrif has a solid foundation to seize these opportunities and successfully compete in this competitive landscape.
Mediagrif is a commerce enabler that develops and operates various SaaS platforms supporting billions of dollars of transactional revenue between approximately 5,000 buyers and 150,000 suppliers.
Our networks are centered around ecosystems of large buyers around which thousands of suppliers connect into for their daily business. Most of our revenue is supplier based and is of a recurring nature, providing better visibility and predictability, and lower dependency and concentration.
We conduct business in numerous verticals such as:
- Food
- General Merchandise & Apparel
- Retail
- Manufacturing
- Infrastructure and construction
The majority of our growth will come from:
- Our strategic M&A plan, laser-focused on increasing our customer count and expanding our geographic coverage in areas in which we are not present. We will also be seeking technology components that bolster our existing product and service offerings. We plan on strengthening our corporate development efforts to build our pipeline of opportunities and accelerate the execution of our M&A strategy.
- Our sustained organic growth plan, compounded by the effect of strategic M&A, where the focus is directed on developing and implementing a sales-driven culture throughout the company.
- A product development strategy built on innovation and monetization of data through high value, AI-based services.
The implementation of this strategy will require the allocation of additional capital and investments, which is expected to create compression on our EBITDA margins. We nevertheless anticipate to generate EBITDA margins of approximately 8 to 12% in the short term while aiming to reach, once the strategic plan is in full execution, a healthy combination of growth and profitability margins.
Funding of the execution of our strategic plan is expected to come from cash flow from operations as well as other sources of financing that may be available to the company, including debt, equity and quasi-equity financing.
SUMMARY OF CONSOLIDATED RESULTS | ||||
Three months ended | Nine months ended | |||
In thousands of Canadian dollars, except per share amounts | 2019 $ | 2018 $ | 2019 $ | 2018 $ |
Revenues | 18,072 | 20,884 | 56,511 | 62,273 |
B2B platforms revenues | 17,074 | 16,819 | 50,800 | 49,185 |
B2C marketplaces revenues | 998 | 4,065 | 5,711 | 13,088 |
Adjusted EBITDA 1 | 159 | 5,291 | 8,043 | 17,163 |
Operating profit (loss) | (1,753) | 3,426 | 2,769 | 11,481 |
Profit (loss) | (1,879) | 2,891 | 1,006 | 8,501 |
Adjusted profit (loss) for the period 3 | (1,879) | 2,891 | 1,089 | 8,501 |
Adjusted earnings (loss) per share 3 (basic and diluted) | (0.13) | 0.19 | 0.07 | 0.57 |
Earnings (loss) per share (basic and diluted) | (0.13) | 0.19 | 0.07 | 0.57 |
Weighted average number of shares outstanding (basic and diluted) | 14,913 | 14,849 | 14,870 | 14,849 |
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3 See the Reconciliation of adjusted profit and profit as well as the "About |
THIRD QUARTER OF FISCAL 2020
For the third quarter of fiscal 2020, revenues totaled
B2B platforms MERX and BidNet revenues increased by a total of
These increases in revenues from B2B have been partially offset by the decrease in revenues from Orckestra of
Revenues from B2C marketplaces totaled
Adjusted EBITDA was negatively impacted during the third quarter of fiscal 2020 by non-recurring costs totaling
Excluding these non-recurring costs, the adjusted EBITDA for the third quarter of fiscal 2020 totaled
The adjusted EBITDA for the quarter also takes into consideration a decrease in tax credits and capitalized internally developed software and web site for an amount of
NET LOSS
Net loss for the third quarter of fiscal 2020 totaled
FINANCIAL POSITION AND FINANCING
As at
During the third quarter of fiscal 2020, the Corporation invested
RECONCILIATION OF ADJUSTED EBITDA AND PROFIT (LOSS)
Adjusted EBITDA represents earnings before interest, taxes, depreciation, amortization, foreign exchange gain (loss) and other revenues (expenses) as historically calculated by the Corporation.
Three months ended | Nine months ended | |||
In thousands of Canadian dollars Unaudited and not reviewed by independent auditors | 2019 $ | 2018 $ | 2019 $ | 2018 $ |
Profit (loss) | (1,879) | 2,891 | 1,006 | 8,501 |
Income tax expense (recovery) | (502) | 1,039 | 375 | 2,980 |
Depreciation of property, plant and equipment and amortization of intangible assets | 797 | 987 | 2,210 | 2,730 |
Amortization of acquired intangible assets | 680 | 910 | 1,882 | 3,057 |
Amortization of right-of-use assets | 435 | - | 1,182 | - |
Amortization of deferred financing costs | 10 | 10 | 29 | 30 |
Amortization of deferred lease inducement | - | (32) | - | (99) |
Foreign exchange loss (gain) | 316 | (825) | 400 | (885) |
Loss (gain) on disposal of a subsidiary | - | - | 83 | - |
Interest on lease liability | 91 | - | 275 | - |
Interest on long-term debt | 210 | 311 | 600 | 849 |
Adjusted EBITDA | 159 | 5,291 | 8,043 | 17,163 |
The adoption of IFRS 16 had a favourable impact of
RECONCILIATION OF PROFIT (LOSS) AND ADJUSTED PROFIT (LOSS) | ||||
Three months ended | Nine months ended | |||
In thousands of Canadian dollars Unaudited and not reviewed by independent auditors | 2019 $ | 2018 $ | 2019 $ | 2018 $ |
Profit (loss) | (1,879) | 2,891 | 1,006 | 8,501 |
Gain (loss) on disposal of a subsidiary – see Note 5 to the financial statements | - | - | (83) | - |
Adjusted profit (loss) for the period | (1,879) | 2,891 | 1,089 | 8 501 |
Profit (loss) per share | (0.13) | 0.19 | 0.07 | 0.57 |
Adjusted profit (loss) per share | (0.13) | 0.19 | 0.07 | 0.57 |
ABOUT
In addition to providing profit measures in accordance with IFRS, the Corporation shows operating profit and earnings before interest, taxes, depreciation, amortization, foreign exchange gain (loss) and other revenues (expenses) ("Adjusted EBITDA") as well as supplementary earnings measures. Operating profit and adjusted EBITDA are not intended to be measures that should be regarded as an alternative to other financial operating performance measures prepared in accordance with IFRS. Those measures do not have a standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other companies. Operating expenses, adjusted EBITDA and net profit are provided to assist investors in determining the Corporation's ability to generate profitability from its operations and to evaluate its financial performance.
This press release contains certain forward-looking statements with respect to the Corporation. These forward-looking statements, by their nature, necessarily involve risks and uncertainties that could cause actual results to differ materially from those expected by these forward-looking statements. We consider the assumptions on which these forward-looking statements are based to be reasonable but caution the reader that these assumptions regarding future events, many of which are beyond our control, may ultimately prove to be incorrect since they are subject to the risks and uncertainties that affect us. We disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable securities legislation. Unless otherwise indicated, all amounts are in Canadian dollars.
Audited consolidated financial statements, accompanying notes and MD&A are available on www.mediagrif.com and have been filed with SEDAR at www.sedar.com.
SOURCE
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