Vancouver - Wishpond Technologies Ltd. (TSXV: WISH, OTCQX: WPNDF) (the 'Company' or 'Wishpond'), a provider of marketing-focused online business solutions, announces it has filed its interim consolidated financial statements and management's discussion and analysis for Q3-2022, representing the three and nine months ended September 30, 2022.
Ali Tajskandar, Wishpond's Chairman and CEO commented, 'We are thrilled with our third quarter results which were the strongest in the Company's history with record revenue and Adjusted EBITDA(1). I am especially proud of the cashflow performance in the third quarter with the Company generating $0.7 million of positive cashflows from operations. As part of a cost reduction initiative launched in Q2-2022 to drive profitable growth, Wishpond continued to scrutinize all new expenditures with the intent to optimize operations and achieve cost-saving synergies. As a result, the Company was able to achieve record positive cash flows from operations and record positive Adjusted EBITDA(1) in Q3-2022. Wishpond has now achieved positive cash flows from operations for the second quarter in a row, a tremendous accomplishment allowing the business to further strengthen its balance sheet. Consequently, we expect Wishpond to have the flexibility to continue to invest in organic and inorganic growth initiatives without the need to go to the market to raise additional capital.'
Ali Tajskandar adds, 'We continue to experience increasing demand for our products and have not witnessed any slowing down or negative impacts due to external macroeconomic conditions. Our outlook remains positive as we head into 2023 with increasing sales, positive Adjusted EBITDA(1), and positive cash flows. We expect to continue to grow rapidly as our sales pipeline remains robust and we begin to introduce bundled solutions to our customers.'
Third Quarter 2022 Financial Highlights
Wishpond achieved record quarterly revenue of $5,483,256 during Q3-2022, a 38% increase compared to revenue of $3,976,965 generated in the same period of 2021 (Q3-2021). The increase in revenue is primarily attributable to the Company's expanded sales team and product integrations from its acquisitions.
Wishpond achieved gross profit(1) of $3,629,111 in Q3-2022 compared to $2,760,709 in Q3-2021, representing a 31% increase from Q3-2021, primarily driven by an increase in overall revenue.
Wishpond achieved a gross margin(1) of 66% in Q3-2022 (69% in Q3-2021). The gross margin(1) achieved in Q3-2022 is within the historical range of 65% to 70%.
In Q3-2022, Wishpond had record positive Adjusted EBITDA(1) of $593,047 ($204,322 in Q3-2021), an increase of 190%. The improvement is primarily driven by higher revenue and continued cost management initiatives and operational efficiencies initiated earlier in the year which are expected to result in more than $1.0 million in annual cost savings.
In Q3-2022, Wishpond had record positive cash flows from operating activities of $670,595 (negative $134,219 in Q3-2021).
As at September 30, 2022, Wishpond had $2,701,267 in cash and short-term investments and no debt (June 30, 2022: cash and short-term investments of $2,654,878 and no debt). Cash balances have held steady despite a quarterly cash earnout payment to Viral Loops in Q3-2022 and continued investment in the growth of the business.
Wishpond has a credit facility with a major Canadian bank for $6,000,000, which remains undrawn and fully available to the Company as of September 30, 2022.
Third Quarter 2022 Business Highlights
On July 12, 2022, the Company announced the launch of an all-new Website Builder product that includes lead tracking and segmentation tools, personalization abilities, advanced forms and pop-ups, integration with Wishpond's email marketing tool, referral marketing, calendar functionality, popups, and more. The Website Builder is expected to increase customer retention, reduce churn, and increase customer satisfaction.
On July 20, 2022, the Company announced three new awards from Gartner, one of the world's most reputed platforms for business software reviews and research. Wishpond received the GetApp Category Leaders Award for content marketing, the Software Advice Front Runners award, and was included in the Capterra shortlist for 2022.
Events Subsequent to September 30, 2022
On October 3, 2022, the Company announced that it completed the integration of its recently acquired subsidiary, Viral Loops, resulting in improved growth in the combined businesses due to greater cross selling and bundling opportunities with larger deal sizes. The completed integration of Viral Loops with the Wishpond platform allows contacts and data to be synchronized between Viral Loops and Wishpond, enabling Wishpond customers to grow their business with referrals and Viral Loops customers to use Wishpond's platform for their marketing activities.
On November 2, 2022, the Company announced that Lloyed Lobo had joined its board of directors as an independent director and member of the Audit Committee effective November 1, 2022. Mr. Lobo replaced Arinder Mahal, who resigned from the Board effective November 1, 2022.
Outlook
Management believes Wishpond's outlook for the remainder of the year and heading into 2023 remains strong and resilient. The business has felt no material impacts due to recession, inflation, supply chain, or other macro-economic effects. Instead, the Company's performance is better than ever and extremely positive across all of its acquisitions and for the entire company as a whole. Wishpond expects to achieve record revenue and cash flows in Q4-2022, driven by the growth of its sales team and the introduction of bundled product offerings. Furthermore, the Company expects to maintain its strong organic growth profile into next year as its revenue and earnings growth are projected to continue in 2023 with further integration of its acquisitions, an increase in cross-selling opportunities, new product launches and higher customer retention.
Management expects cash flows generated by the Company to continue to be re-invested in the business and allocated in a disciplined manner, which may come in the form of future acquisitions, share repurchases, or to accelerate organic growth. Wishpond has a clean balance sheet and expects to continue to fund the growth of its sales team and new product launches from cash flows from operations, without having to raise any additional equity or debt capital.
Wishpond's objectives heading into 2023 are to continue growing its business both organically and inorganically and to continue demonstrating a disciplined capital allocation strategy to maintain profitability and increase its cash position while increasing sales. Wishpond has a robust sales pipeline and will look to drive revenue growth in 2023 by investing in the Company's sales and marketing functions, cross-selling the Company's products and services and introducing bundled packages of its product lines to new customers.
David Pais, Wishpond's Chief Financial Officer commented, 'Wishpond remains in an extremely strong financial position with a clean and healthy balance sheet, increasing cash flows and record performance demonstrated through the achievement of record revenue, Adjusted EBITDA(1) and cash flow generation. Our cost optimization efforts have paid off, resulting in increasing profitability and cash flows. We are going to continue building off this momentum by growing our EBITDA(1) and further strengthening our cash position in 2023. Based on the Company's performance thus far, we are expecting very strong results in Q4-2022 and we look forward to sharing those results in the new year.'
About Wishpond Technologies Ltd.
Based out of Vancouver, British Columbia, Wishpond is a provider of marketing-focused online business solutions. Wishpond's vision is to become the leading provider of digital marketing solutions that empower entrepreneurs to achieve success online. The Company offers an 'all-in-one' marketing suite that provides companies with marketing, promotion, lead generation, and sales conversion capabilities on one integrated platform. Wishpond replaces disparate marketing solutions with an easy-to-use product, for a fraction of the cost. Wishpond serves over 4,000 customers who are primarily small and medium-sized businesses (SMBs) in a wide variety of industries. The Company has developed cutting-edge marketing technology solutions and continues to add new features and applications with great velocity. The Company employs a Software-as-a-Service (SaaS) business model where substantially all the Company's revenue is subscription-based recurring revenue which provides excellent revenue predictability and cash flow visibility. Wishpond is listed on the TSX Venture Exchange under the ticker 'WISH', and on the OTCQX Best Market under the ticker 'WPNDF'.
Forward-Looking Statements
Statements that are not reported financial results or other historical information are forward-looking statements or forward-looking information within the meaning of applicable securities laws (collectively, 'forward-looking statements'). This press release includes forward-looking statements regarding the Company, its subsidiaries and the industries in which they operate, including statements about, among other things, all information contained under the heading 'Outlook' herein, references to expected results from future operations, financial results or operational activities that may be undertaken by the Company, the results of the Company's cost-savings initiative, any future acquisitions, share purchases or other activities done to grow the company both organically or inorganically, expectations, beliefs, plans, future operations, origination of additional targets in which the Company may hold an interest and acquisition opportunities for the Company, business and acquisition strategies, opportunities, objectives, prospects, assumptions, including those related to trends and prospects, and future events and performance. Sentences and phrases containing or modified by words such as 'expect', 'anticipate', 'plan', 'continue', 'estimate', 'intend', 'expect', 'may', 'will', 'project', 'predict', 'potential', 'targets', 'projects', 'is designed to', 'strategy', 'should', 'believe', 'contemplate' and similar expressions, and the negative of such expressions, are not historical facts and are intended to identify forward-looking statements. Readers are cautioned to not place undue reliance on forward-looking statements. Actual results and developments may differ materially from those contemplated by forward-looking statements. Although the Company believes that the expectations reflected in forward-looking statements in this press release are reasonable and are based on, among other things, the expectations and analysis of current market trends and opportunities of management of the Company, such forward-looking statements has been based on expectations, factors and assumptions concerning future events which may prove to be inaccurate and are subject to numerous risks and uncertainties, certain of which are beyond the Company's control, including, but not limited to, economic uncertainty and instability as a result of the ongoing inflation and supply chain issues, increasing interest rate climate and recessionary risks, COVID-19 pandemic, Russia-Ukraine war, instability in global commodity and securities markets, shifts in consumer and institutional spending and marketing strategies, the changing global market and competition for the products and services supplied by the Company, and the additional risk factors discussed in the continuous disclosure materials of the Company which are available under the Company's profile on SEDAR at www.sedar.com. The forward-looking statements contained in this press release are expressly qualified by this cautionary statement and are made as of the date hereof. The Company disclaims any intention and has no obligation or responsibility, except as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Contact:
Pardeep S. Sangha
Tel: 604-572-6392
Email: investor@wishpond.com
WISHPOND TECHNOLOGIES LTD. 
