MONTREAL, June 19, 2020 /CNW/ -- Engagement Labs Inc. (TSXV: EL) released results for its first quarter ended March 31, 2020. Condensed interim consolidated Financial Statements and Management Report are available on SEDAR's website at www.sedar.com.
First Quarter Financial Highlights
- TotalSocial® revenue increased by 11% to $972,419 in Q1 2020 from $878,302 in Q1 2019.
- Total revenue increased by 7% to $972,419 in Q1 2020 from $911,368 in Q1 2019.
- Gross profit was $457,368 for Q1 2020, an increase of 17% compared to $389,963 for Q1 2019. As a percentage of revenue, the gross margin increased to 47% for Q1 2020 from 43% for Q1 2019.
- EBITDA(1) loss improved by 19% or $168,628, to -$700,732 for Q1 2020 from -$869,360 for Q1 2019.
- Non-GAAP Adjusted EBITDA(1) loss improved by 64% or $359,371, to -$203,494 for Q1 2020 from -$562,865 for Q1 2019.
- Operating expenses (including an impairment loss on goodwill of $361,134) decreased by 3% or $48,504, to $1,345,853 for Q1 2020 from $1,394,357 for Q1 2019.
- Net loss for Q1 2020 decreased to -$894,111, down 30% or $375,025 from -$1,269,136 for Q1 2019.
- Basic and diluted loss per share was ($0.00) for Q1 2020, compared to ($0.01) for Q1 2019.
- As at March 31, 2020, the Company was holding cash of $591,764 compared to $844,107 as at December 31, 2019.
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(1)
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EBITDA is defined as earnings before interest, income taxes, depreciation and amortization. Number for comparative periods were revised to exclude SRED credit tax, variation on exchange, and bank charges in EBITDA. Adjusted EBITDA is a non-GAAP financial measure defined as EBITDA to which the Company adds stock-based compensation including the grant of stock options, restricted shares units, and restricted share awards as these expenses do not result in any use of operating cash flows by the Company, severance payments, impairment loss on goodwill, write-off of intangible assets, change in fair value of investment in shares, expenses related to acquisition or disposal of business, and loss on extinction of debt and equity components of convertible debentures, which are extraordinary and non-recurrent expenses, and Board remuneration, which is paid in shares units. EBITDA and non-GAAP adjusted EBITDA are provided as a supplementary earning measure to assist readers in determining the ability of ENGAGEMENT LABS INC. to generate cash from operations and to cover financial charges. They are also widely used for business valuation purposes. These measures do not have a standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other companies.
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"I am pleased with TotalSocial revenue growth of 11% in Q1 '20 vs the same period a year ago, and also that our cost containment activities have led to a four point improvement in gross margin and a 64% reduction in our Non-GAAP Adjusted EBITDA loss – which is the lowest since the launch of TotalSocial -- both of which have been priorities for us," said Ed Keller, CEO. "We understand that COVID-19 and the economic recession in the US and around the world will lead to a challenging business environment, so operating as efficiently as possible is a major priority for us as it is for so many companies in this environment. While we are encouraged by these Q1 2020 results, on top of our performance improvement in 2019, COVID-19 has led to a significant reduction in marketing spend by major brands of the type who are our customers and with it a pull back in spending on services of the type we provide and this will have a revenue impact on our Q2 results. We are encouraged by recent reports in the press about ad and marketing spending picking back up in Q3 and Q4, but it is impossible to determine the extent or length of financial implications of these events for the moment." Keller continued, "Subsequent to Q1 the company has received financial relief from the Canadian and US governments in the amount of approximately $710,000, as noted in our Financial Statement."
About Engagement Labs
Engagement Labs (TSXV: EL) is an industry-leading data and analytics firm that provides social intelligence for Fortune 500 brands and companies.
To learn more visit www.engagementlabs.com
Disclaimer in regard to Forward-looking Statements
Certain statements included herein constitute "forward-looking statements" within the meaning of applicable securities laws. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management at this time, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Investors are cautioned not to put undue reliance on forward-looking statements. Except as required by law, Engagement Labs does not intend, and undertakes no obligation, to update any forward-looking statements to reflect, in particular, new information or future events.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
For media inquiries please contact:
Vanessa Lontoc / Ed Keller, CEO
Engagement Labs
vanessa.lontoc@engagementlabs.com / ed.keller@engagementlabs.com
SOURCE Engagement Labs
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