NEW BRUNSWICK, N.J. and TORONTO, Nov. 25, 2021 /CNW/ -- Engagement Labs Inc. (TSXV: EL) released results for its third quarter ended September 30, 2021. Condensed interim consolidated Financial Statements and Management Report are available on SEDAR's website at www.sedar.com.
Third Quarter Financial Highlights
- Total revenue increased by 20% to $611,615 in Q3 2021 from $509,940 in Q3 2020;
- Gross profit was $272,268 in Q3 2021, an increase of 46% compared to $186,148 in Q3 2020. As a percentage of revenue, the gross margin increased to 45% for Q3 2021 from 37% for Q3 2020;
- EBITDA(1) improved by 141% or $1,348,723, to $389,342 in Q3 2021 from -$959,381 in Q3 2020;
- Non-GAAP Adjusted EBITDA(1) improved by 32% or $125,043, to -$263,659 in Q3 2021 from -$388,702 in Q3 2020;
- Operating expenses before gain on settlement of trade payables and other long-term payables and impairment loss on goodwill decreased by 19% or $166,356, to $708,544 in Q3 2021 from $874,900 in Q3 2020;
- Net profit in Q3 2021 was $258,044, compared to a net loss of -$1,129,113 in Q3 2020, for an improvement of 123% or $1,387,157;
- Basic and diluted profit per share was $0.001 in Q3 2021, compared to a basic and diluted loss per share of ($0.005) in Q3 2020;
- As at September 30, 2021, the Company was holding cash of $920,437 compared to $868,053 as at December 31, 2020.
Nine-month Period Financial Highlights
- Total revenue increased by 1% to $2,120,867 for the nine-month period ended September 30, 2021 from $2,106,372 for the nine-month period ended September 30, 2020;
- Gross profit increased by 21% to $1,005,015 for the nine-month period ended September 30, 2021 compared to $831,740 for the nine-month period ended September 30, 2020. As a percentage of revenue, the gross margin increased to 47% for the nine-month period ended September 30, 2021 from 39% for the nine-month period ended September 30, 2020;
- EBITDA(1) improved by 99% or $2,161,596, to -$14,048 for the nine-month period ended September 30, 2021 from -$2,175,644 for the nine-month period ended September 30, 2020;
- Non-GAAP Adjusted EBITDA(1) improved by 49% or $442,568, to -$462,298 for the nine-month period ended September 30, 2021 from -$904,866 for the nine-month period ended September 30, 2020;
- Operating expenses before gain on settlement of trade payables and other long-term payables and impairment loss on goodwill decreased by 24% or $694,305, to $2,144,909 for the nine-month period ended September 30, 2021 from $2,839,214 for the nine-month period ended September 30, 2020;
- Net loss for the nine-month period ended September 30, 2021 decreased to -$441,804, down 84% or $2,316,610 from -$2,758,414 for the nine-month period ended September 30, 2020;
- Basic and diluted loss per share was ($0.002) for the nine-month period ended September 30, 2021, compared to ($0.012) for the nine-month period ended September 30, 2020.
(1) 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.
Corporate Update
The Company announced on November 1, 2021 that the completion of its previously announced merger proposal with DGTL Holdings Inc., if approved by shareholders, might not be completed before year-end due to a delay in DGTL's year-end financial filing which delayed its ability to raise financing for the transaction.
Since that time DGTL has issued its year end Audit and its Q1 2022 results and has reaffirmed its desire to close the transaction with the Company. Toward this end, DGTL has lowered the financing condition for closing the acquisition to $1m CAD and indicated it expects to close the financing in early December. Based on its expectations that all necessary conditions will be met to allow the Plan of Arrangement to be approved, the Company is preparing to set a meeting date for shareholders to vote on the proposed merger in early February. The merger is expected to close in Q1 2022.
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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