- EMERGE reported record quarterly revenue of $7.1 million, up 223% compared to $2.2 million in Q1 2020
- Positive Adjusted EBITDA(1) of $0.27 million, compared $0.23 million in Q1 2020
- Cash on hand was $21.4 million as at March 31, 2021, following $12.1 million equity financing
TORONTO, May 27, 2021 /CNW/ - EMERGE Commerce Ltd. (TSXV: ECOM) ("EMERGE" or the "Company"), a diversified, rapidly growing acquirer and operator of direct-to-consumer ("D2C") e-commerce brands, today announced results for the first quarter ended March 31, 2021.
"Q1 was another record quarter for EMERGE, and the first quarter that includes the impact of truLOCAL, our most recent acquisition which closed December 31, 2020. truLOCAL exhibited strong organic growth and profitability in Q1, exceeding management's expectations. Overall, revenue more than tripled, and we achieved another quarter of positive Adjusted EBITDA," commented Ghassan Halazon, Founder and CEO, EMERGE.
Q1 2021 Financial Highlights
- Gross Merchandise Sales ("GMS")(1) increased to $11.4 million for the three months ended March 31, 2021, an increase of 81% from $6.3 million in Q1 2020
- Q1 2021 revenue increased to $7.1 million, up 223% from $2.2 million in Q1 2020, driven by the acquisition of truLOCAL
- EMERGE reported positive Adjusted EBITDA(1) of $0.27 million for Q1 2021 compared to $0.23 million in Q1 2020
- EMERGE ended Q1 with a strong balance sheet including $21.4 million in cash. During the quarter, EMERGE raised gross proceeds of $12.1 million in equity financing
"We saw robust organic growth in premium meat subscriptions, driven by truLOCAL, and enormous early promise in our fast-growing golf products business, JustGolfStuff.ca, a Shopify-powered site, which saw explosive growth throughout the quarter. Despite the challenging climate that persisted for our experience-based offerings during the pandemic, our diversified e-commerce portfolio demonstrated its strength and agility," continued Halazon.
Q1 2021 Highlights
- In January 2021, EMERGE hired George Marouchos to the leadership team, as Vice President, M&A and Corporate Development. Mr. Marouchos was most recently a member of the senior leadership team at Dye and Durham (TSX: DND).
- In February 2021, EMERGE announced truLOCAL, the Canadian leader in premium meat subscriptions, expanded into Quebec, Canada's second largest province by population, and truLOCAL's fifth market overall.
- In March 2021, the Company raised an aggregate of $12.1 million through a private placement offering of 8,647,570 special warrants of the Company. Each Special warrant is exercisable for one common share in the capital of the Company at no additional cost.
- In March 2021, Canaccord Genuity and Raymond James both initiated research coverage on the Company. Clients of Canaccord Genuity and Raymond James can access the research reports directly at their respective brokers.
Outlook
With $21.4 million of cash on hand, EMERGE is advancing its growing acquisition pipeline. EMERGE aims to acquire D2C e-commerce businesses for approximately 5-6x EBITDA, typically with up to 50% of the purchase price in upfront cash. Potential targets currently combine for approximately $68 million EBITDA, including signed LOIs.
"We continue to ramp up our team, making key hires to support both existing and future potential acquisitions. We are carefully exploring and advancing various opportunities in our growing acquisition pipeline. Consolidating profitable D2C e-commerce brands is a tremendous opportunity, and our strong balance sheet puts us in a prime position to capitalize on it," said Halazon.
The Company's main goals are to: (i) acquire additional niche D2C e-commerce brands with a track record of growth and profitability; (ii) achieve organic growth for the existing portfolio of brands; and (iii) invest in the team and infrastructure to support further acquisitions and scaling.
Conference Call
Management will host a conference call on Thursday, May 27, 2021 at 8:30 am ET to discuss first quarter results. To access the conference call, please dial (416) 764-8650 or (888) 664-6383 and provide conference ID 73207889.
Alternatively, the conference call can be accessed online at:
https://produceredition.webcasts.com/starthere.jsp?ei=1466587&tp_key=210118266b
Selected Unaudited Financial Highlights
Please see SEDAR for complete copies of the Company's unaudited condensed consolidated interim financial statements and MD&A for the three months ended March 31, 2021.
| | | Three months ended March 31, | Three months ended March 31, |
| | | 2021 $ | 2020 $ |
| Gross Merchandise Sales1 | | 11,350,883 | 6,262,265 |
| Total revenue | | 7,080,314 | 2,194,802 |
| Adjusted EBITDA1 | | 269,540 | 231,417 |
| Net (loss) income | | (2,008,468) | (1,038,491) |
| Basic and diluted (loss) per share | | (0.02) | (0.02) |
| |
| (1) Non-GAAP Financial Measure. Refer to section "Non-GAAP Financial Measures" below for additional information. |
About EMERGE
EMERGE (TSXV: ECOM) is a disciplined, diversified, rapidly growing acquirer and operator of direct-to-consumer ("D2C") e-commerce brands. Our network of e-commerce sites provides our members with access to premium meat subscriptions, groceries, golf, family offers and nearby escapes. Our portfolio houses some of North America's most coveted online destinations including trulocal.ca, UnderPar.com, JustGolfStuff.ca, WagJag.com, and BeRightBack.ca. EMERGE was named one of the fastest growing companies in Canada by the Startup 50, and the Globe and Mail's 2020 Canada's Top Growing Companies.
To learn more visit https://www.emerge-commerce.com/
Cautionary notice
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Non-GAAP Measures