CIBC Part 1 August 6, 2020 Flash Research
DOCEBO, INC.
Q2/20 First Look: Beat With Stronger-than-expected Margins
Our Conclusion: Positive - Docebo reported both subscription revenue
growth and adjusted EBITDA margins above consensus and our
expectations. Subscription revenue of $13.4 million was up 55% and above
our $12.8 million expectation. The company recorded $0.2 million in cash
from operations and an EBITDA loss of $0.9 million, well ahead of consensus
expectations of a $2.1 million loss. ACV rose 25% in the quarter and Annual
Recurring Revenues (ARR) were up 55% to $57 million.
Key Highlights
FQ2/20 Results: Docebo reported revenue of $14.5 million (consensus
$13.6 million) and EBITDA of -$0.9 million (consensus -$-2.1 million).
Adjusted EBITDA margins of -6.2% were ~920 bps above consensus.
ARR Growth Continues: Docebo reported updated Annual Recurring
Revenues of $57 million, up 55% Y/Y and up from $52.1 million at the end of
Q1/20.
Revenue Growth: Revenue of $14.5 million represented 46% Y/Y growth.
Revenue growth was due to new customer additions and average contract
value expansion. Total customer count increased from 1,651 to 2,046 Y/Y.
The Y/Y change in Average Contract Value was 24.7%, growing from
$22,350 to $27,859.
Cash Flow: Cash flow generated from operations was $0.2 million in the
quarter, down from $0.8 million in the prior year. The decrease in cash flow
Y/Y was primarily due to working capital changes, as receivables balances
increased. Docebo ended the quarter with $43 million in cash, flat
sequentially and down slightly from $46 million at the end of Q4.
EBITDA Margins: EBITDA margins were -6.2% in the quarter, above
consensus and us (-15.4% and -16.0%). Stronger margins were a result of
higher revenue and improvements to gross margin and G&A spending.
Profitability: Gross margins in the quarter were 80.4%, slightly ahead of our
estimate (80.0%) and below consensus (84.6%). Gross margins were up
slightly Y/Y (79.2% in Q2/19).