- ARC Annual Recurring Revenue Grows by 146% Year over Year -
TORONTO, May 29, 2018 /CNW/ - VersaPay Corporation (TSXV: VPY) ("VersaPay" or the "Company"), a leading provider of cloud-based invoice-to-cash solutions including electronic invoice presentment and payment, automated accounts receivable, cash application and collections management, today announced first quarter ("Q1") financial results for the three-month period ended March 31, 2018.
"We are very pleased with our start to the 2018 fiscal year as we are seeing a rapid increase in our ARC Annual Recurring Revenue (ARR)," said Craig O'Neill, CEO of VersaPay. "We continue to see more and more businesses across our target industries actively seeking to improve their accounts receivable and our pipeline and new signings are gaining momentum as a result."
Mr. O'Neill continued, "ARC ARR at the end of the quarter was two and a half times that of the first quarter of last year, and for the first time ever has exceeded the ARR of our payments solution PayPort. This growth is thanks to our direct marketing and sales teams which were expanded in Q4 to increase our reach in the US. As our new team members get further up the learning curve and build their pipelines we expect this growth to accelerate. Our progress in channel sales will further add to our growth in the second half of the year."
Operational Highlights:
- Strong new sales for ARC™. 11 new clients were signed in the quarter, excluding sales of ARC Small Business Edition. This represent the Company's strongest sales quarter ever and was made up of seven sales in the US, and four sales in Canada. Two of these sales came from channel partners and the remainder were from VersaPay's direct sales efforts. These results are a direct outcome of the US expansion plan the Company embarked on in Q4 of 2017. The plan included expanding the sales team in the US and increasing VersaPay's digital marketing investment, both of which had an immediate impact in Q1."
- Strong increases in ARC™ usage metrics: At the end of Q1 2018, 106,749 end-customers were using ARC™ compared to 42,291 at the end of March 31, 2017, and approximately 392,000 invoices were delivered to end-customers during the quarter compared to 254, 000 invoices in Q1 2017. Total payments in Q1 2018 were $155.8 million, compared to $51 million in Q1 2017 and $101.0 million in Q4 2017.
- Expanded Channel program: The first Value-Added Reseller (VAR) that specializes in the sale and implementation of the Sage Intacct ERP system was signed in Q1. This marks the first of many VARs the Company plans to sign as part of its channel strategy. VARs are well-positioned to sell and implement ARC with as a natural extension of the current business they do with their clients. VersaPay is marketing to VARs that specialize in Sage Intacct, Oracle JDE and Accumatica – a community of more than 5,000 companies.
Financial Highlights:
- Total Annual Recurring Revenue ("ARR") as of Q1 2018 was $3.72 million, compared to $1.93 million as of Q1 2017, an increase of 93%.
- Annual Recurring Revenue from ARC as of Q1 2018 was $1.92 million compared to $0.78 million in Q1 2017, an increase of 146%.
- Total Revenue for Q1 2018 increased by 108.1% to $1.01 million compared to $0.49 million in Q1 2017.
- Gross margin percentage for Q1 2017 was 66.7%, compared to 56.4% in Q1 2017.
- Adjusted EBITDA(1) was ($2.51) million in Q1 2018, compared to ($1.80) million in Q1 2017.
- Total comprehensive loss for Q1 2018 was ($2.68) million, compared to a gain of 7.01 million for Q1 2017, which included earnings from the now discontinued POfS Merchant Services segment of the business.
- Total operating expense for the first quarter March 31, 2018 increased by 60.3% to $3.44 million, compared to $2.17 million for the three-months ended March 31, 2017.
- As at March 31, 2018, the Company had cash on hand of $13.40 million compared to $15.83 million as at December 31, 2017.