Revenue of $22.4 million,
with year-over-year revenue growth of
51%
Reiterates full year 2021 revenue guidance
in the range of $90 - $98 million
BuildDirect reports in
US dollars and in accordance with IFRS
VANCOUVER, BC, Nov. 18, 2021 /CNW/ - BuildDirect.com
Technologies Inc. (TSXV: BILD) ("BuildDirect" or the "Company"), an
innovative platform for purchasing and selling building materials
online, today announced its financial results for the three and
nine months ended September 30,
2021.
"BuildDirect continues to benefit from ongoing investment in the
home," said Dan Park, CEO of
BuildDirect. "We remain committed to delivering on our strategy,
which focuses on our differentiated omnichannel offering and
infrastructure, as well as executing select accretive acquisitions
to broaden our reach and accelerate our growth. Our solid third
quarter performance combined with increasing investments in the
home indicate that we are on pace to deliver on the full year
revenue guidance of $90 -
$98 million."
Ethan Rudin, CFO of BuildDirect
added, "Our recently announced acquisition of U.S.-based Superb
Flooring & Design aligns directly with our strategy to acquire
B2B-focused targets, increasing our Pro customer base, driving
larger basket sizes, and expanding our North American presence. We
remain keenly positioned to realize BuildDirect's mission to
accelerate the home renovation industry into the digital era with
our distinct DiPhy (digital + physical) strategy, leveraging our
robust technology and heavy weight delivery platform, which when
combined with the local presence, trust and service of the best
independent retailers, provides an unmatched end-to-end experience
for the underserved Pro customer."
Third
Quarter 2021 Financial Highlights
|
USD$ (unless otherwise noted)
|
Third Quarter 2021
|
Third Quarter 2020
|
% Change
|
YTD
2021
|
|
Revenue
|
$22.4
million
|
$14.8
million
|
51%
|
$66.6
million
|
|
Gross Profit
|
$8.1
million
|
$5.5
million
|
48%
|
$24.3
million
|
|
Gross Margin
|
36.4%
|
37.0%
|
(0.6%)
|
36.4%
|
|
Adjusted EBITDA1
|
($0.6
million)
|
($0.1
million)
|
(400%)
|
($0.8
million)
|
|
1
|
Adjusted EBITDA is a
non-IFRS measure. See "Non-IFRS Measures" in the MD&A and
the reconciliation to the most directly comparable
IFRS measure below.
|
Third Quarter 2021 Financial and Operational Highlights
- Revenue of $22.4 million
increased 51% compared to the third quarter of 2020, primarily
driven by the December 31, 2020
acquisition of FloorSource, and an increase in customer demand for
building supplies.
- Pro revenue increased by 216% compared to the third quarter of
2020 and represents 66% of total revenue in the third quarter of
2021.
- Gross profit increased 48% to $8.1
million compared to $5.5
million in the third quarter of 2020.
- Gross margin decreased by 60bps to 36.4% compared to the third
quarter of 2020 due to slightly lower gross margin percentages from
the FloorSource business and higher supply chain costs in 2021
compared to 2020.
- Adjusted EBITDA of ($0.60
million), a decrease as compared to the third quarter of
2020 due to investments in sales and marketing to accelerate sales
growth, as well as lower government tax credits received to offset
our research and development expenses.
Post Quarter Highlights
- On November 17, 2021, BuildDirect
announced its agreement to acquire Superb Flooring & Design LLC
for USD $10 million, expanding our
Pro market segment share.
- The Company has kicked off the search to appoint a new CEO and
is finalizing the transition plan to ensure a smooth handover.
- Appointed experienced home improvement executives, Peg Hunter and Henry
Lees-Buckley, to the Board of Directors.
2021 Outlook
BuildDirect's business performance
accelerated over the past year, as a result of significant growth
in the home improvement products industry driven by a shift towards
investment in the home, which has driven record breaking online
growth in building material purchases. Over the long-term,
BuildDirect intends to drive gross margin improvements through
further alignment of unit economics and profitability in addition
to enhancing revenue through its omnichannel platform and accretive
acquisition pipeline. In 2021, BuildDirect anticipates revenue in
the range of $90 - $98 million, representing significant
year-over-year growth.
In line with the industry, BuildDirect experienced near-term
challenges with our supply chain and products due to short-term
headwinds. However, due to the hard work of our team and support of
our partners, we were able minimize the impact and continue to
provide great value and service as well as remain in-stock for our
customers.
BuildDirect remains bullish as the Company continues to leverage
its DiPhy (digital + physical) growth strategy and expands its
reach into bricks and mortar independent retailers and captures the
B2B professionals. The above guidance does not include the
Superb acquisition or additional acquisitions, however BuildDirect
maintains a strong funnel of actionable acquisition targets that
fit within its well-defined investment criteria.
Actual results may differ materially from BuildDirect's
financial outlook as a result of, among other things, the factors
described under "Forward-Looking Statements" below.
BuildDirect's unaudited condensed interim consolidated financial
statements and accompanying notes, and Management's Discussion and
Analysis for the three and nine months ended September 30, 2021 are available on the Company's
website at www.BuildDirect.com and on the Company's SEDAR profile
available at www.sedar.com.
Third Quarter 2021 Financial Results Conference Call
BuildDirect will host a conference call and webcast to discuss the
Company's financial results at 9:30 am EST
on Thursday, November 18, 2021. To access the
telephonic version of the conference call, participants can dial
(888) 664-6392 (North America Toll-Free) or (416) 764-8659. Upon
entering the confirmation ID: 56632983, participants will be
entered directly into the conference.
Alternatively, the webcast will be available live on the
Investor Relations section of BuildDirect's website
at https://ir.builddirect.com/events-and-presentation
Among other things, BuildDirect will discuss long-term financial
outlook on the conference call and webcast, and related materials
will be made available on the Company's website at
https://ir.builddirect.com/events-and-presentation. Investors
should carefully review the factors, assumptions, risks and
uncertainties included in such related materials concerning such
long-term financial outlook.
An audio replay of the call will be available approximately two
hours after the completion of the live call until 8:59 pm EST on November
25th, 2021. The audio replay will be accessed by dialing
(888) 390-0541 (North America Toll-Free) or (416) 764-8677
(Toronto) with entry code: 632983.
In addition, an archived webcast will be available on the Investor
Relations section of the Company's website at
https://ir.builddirect.com/events-and-presentation.
About BuildDirect
BuildDirect (TSXV: BILD) is an innovative technology platform for
purchasing and selling building materials online. The BuildDirect
platform connects homeowners and home improvement professionals in
North America with suppliers and
sellers of quality building materials from around the world,
including flooring, tile, decking and more. BuildDirect's growth,
proprietary heavyweight delivery network, and digital reach have
served to solidify its role as a ground-breaking player in the home
improvement industry. For more information, visit
http://www.builddirect.com./.
Forward-Looking Information:
This press release contains statements which constitute
"forward-looking statements" and "forward-looking information"
within the meaning of applicable securities laws (collectively,
"forward-looking statements"), including statements regarding the
plans, intentions, beliefs and current expectations of the Company
with respect to future business activities and operating
performance. Forward-looking statements are often identified by the
words "may", "would", "could", "should", "will", "intend", "plan",
"anticipate", "believe", "estimate", "expect" or similar
expressions. These statements reflect management's current beliefs
and expectations and are based on information currently available
to management as at the date hereof.
Forward-looking statements in this press release may include,
without limitation, statements relating to BuildDirect's innovative
technology and heavyweight platform and end to end experience for
the Pro customer segment, BuildDirect's DiPhy strategy and
acceleration of the home renovation industry into the digital era,
BuildDirect increasing its Pro customer base, driving larger basket
sizes, and expanding its North American presence, BuildDirect's
accretive acquisition pipeline, potential growth, potential value
for all stakeholders, expected growth margins, and expected
revenues for 2021.
Forward-looking statements involve significant risk,
uncertainties and assumptions. Many factors could cause actual
results, performance or achievements to differ materially from the
results discussed or implied in the forward-looking statements.
Among those factors are changes in consumer spending, availability
of mortgage financing and consumer credit, changes in the housing
market, changes in trade policies, tariffs or other applicable laws
and regulations both locally and in foreign jurisdictions,
availability and cost of goods from suppliers, fuel prices and
other energy costs, interest rate and currency fluctuations,
retention of key personnel and changes in general economic,
business and political conditions. These forward-looking statements
may be affected by risks and uncertainties in the business of the
Company and general market conditions, including COVID-19.
These factors should be considered carefully and readers should
not place undue reliance on the forward-looking statements.
Although the forward-looking statements contained in this press
release reflect the Company's expectations, estimates or
projections concerning future results or events based on the
opinions, assumptions and estimates of management considered
reasonable at the date the statements are made, the Company cannot
assure readers that actual results will be consistent with these
forward-looking statements. These forward-looking statements are
made as of the date of this press release, and BuildDirect assumes
no obligation to update or revise them to reflect new events or
circumstances, except as required by law.
|
For the three
months
ended September
30
|
For the nine
months
ended September
30
|
|
2021
|
2020
|
2021
|
2020
|
|
Adjusted
EBITDA
|
|
|
|
|
|
Gain (Loss) for the
period
|
$ 673,240
|
$
(196,386)
|
$
(12,927,217)
|
$
(2,427,433)
|
|
Income tax
expense
|
474,031
|
-
|
1,283,537
|
-
|
|
Depreciation and
amortization
|
794,995
|
168,970
|
2,746,238
|
614,420
|
|
Interest
|
503,572
|
147,819
|
1,765,159
|
498,600
|
|
EBITDA
|
2,445,839
|
120,403
|
(7,132,283)
|
(1,314,413)
|
|
|
|
|
|
|
EBITDA
adjustments
|
|
|
|
|
|
Stock-based
compensation
|
$ 196,284
|
$ 57,520
|
$
1,250,114
|
$ 172,561
|
|
Foreign exchange
(gain)/loss
|
(98,063)
|
(301,735)
|
(9,899)
|
(382,595)
|
|
Fair value adjustment
of
convertible debt and warrants
|
(4,964,539)
|
-
|
1,455,090
|
-
|
|
Impact of fair value
adjustment of Inventory in
FloorSource acquisition1
|
-
|
-
|
528,552
|
-
|
|
Significant bad debt
expense2
|
|
|
257,891
|
-
|
|
Finance
costs3
|
374,652
|
-
|
1,444,745
|
-
|
|
Listing
expenses4
|
1,017,659
|
-
|
1,017,659
|
-
|
|
Other expenses
related to TSXV listing5
|
409,211
|
-
|
409,211
|
-
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
(618,958)
|
(123,812)
|
(778,920)
|
(1,524,447)
|
|
Adjusted EBITDA
%
|
(3%)
|
(1%)
|
(1%)
|
(4%)
|
|
1
|
The adjustment for
the impact of the fair value of FloorSource inventory relates to
the impact on normal selling
profit from the fact that IFRS requires that the inventory be
recorded at fair value on acquisition and not at
FloorSource's historical cost. Earnings are impacted as this
inventory was sold in the
period.
|
|
2
|
The adjustment is
a non-recurring activity, relating to a provision for an advance
made to a former employee,
which was deemed uncollectible in 2021.
|
|
3
|
The adjustment
relates to agents' commission and certain expenses of the private
placement offering totalling
CDN $1,796,748.
|
|
4
|
The adjustment
relates to the consideration transferred in excess of the net
assets acquired and certain
expenses related to the reverse acquisition.
|
|
5
|
The adjustment
relates to the non-recurring legal and accounting expenses required
to bring the company to
public company standards.
|
Condensed Consolidated Interim Statement of Financial
Position
(Unaudited)
(Expressed in United States
dollars)
|
|
September
30,
|
|
December
31,
|
|
|
2021
|
|
2020
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
17,874,738
|
$
|
5,416,511
|
|
Restricted cash
|
|
74,921
|
|
-
|
|
Short-term
investments
|
|
118,000
|
|
118,000
|
|
Trade and other
receivables
|
|
3,059,098
|
|
2,727,955
|
|
Advances to
vendors
|
|
2,870,902
|
|
391,641
|
|
Inventories
|
|
6,204,115
|
|
5,446,940
|
|
Prepaid materials,
expenses and deposits
|
|
815,114
|
|
994,597
|
|
Total current
assets
|
|
31,016,888
|
|
15,095,644
|
|
Non-current
assets:
|
|
|
|
|
|
Property and
equipment
|
|
544,667
|
|
835,921
|
|
Intangible
assets
|
|
9,621,692
|
|
11,326,135
|
|
Right-of-use assets
(note 8)
|
|
3,376,327
|
|
900,834
|
|
Non-current advances to
vendors
|
|
567,279
|
|
567,284
|
|
|
|
|
|
|
Total
Assets
|
$
|
45,126,853
|
$
|
28,725,818
|
|
|
|
|
|
|
Liabilities and
Shareholders' Equity (Deficiency)
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Accounts payable and
accrued
liabilities
|
$
|
10,388,872
|
$
|
6,834,980
|
|
Income taxes
payable
|
|
1,283,537
|
|
-
|
|
Current portion of
lease
liabilities
|
|
990,640
|
|
458,841
|
|
Deferred
revenue
|
|
2,689,351
|
|
1,531,960
|
|
Loan
payable
|
|
3,810,038
|
|
3,927,113
|
|
Current portion of
promissory
note
|
|
1,715,004
|
|
1,145,986
|
|
Current portion of
deferred consideration payable
|
|
523,240
|
|
602,681
|
|
|
21,400,682
|
|
14,501,561
|
|
Non-current
liabilities
|
|
|
|
|
|
Deferred consideration
payable
|
|
1,242,379
|
|
1,018,555
|
|
Lease
liabilities
|
|
3,370,647
|
|
1,476,044
|
|
Convertible
notes
|
|
-
|
|
12,120,679
|
|
Warrants
|
|
1,517,051
|
|
480,321
|
|
Promissory
note
|
|
4,197,089
|
|
4,552,670
|
|
|
10,327,166
|
|
19,648,269
|
|
Shareholders' equity
(deficiency):
|
|
|
|
|
|
Share
capital
|
|
122,959,732
|
|
92,459,612
|
|
Share based payment
reserve
|
|
11,645,851
|
|
10,395,737
|
|
Deficit
|
|
(121,206,578)
|
|
(108,279,361)
|
|
|
13,399,005
|
|
(5,424,012)
|
|
Total Liabilities and
Equity
|
$
|
45,126,853
|
$
|
28,725,818
|
Condensed Consolidated Interim Statement of Operations and
Comprehensive Loss
(Unaudited)
(Expressed in United States
dollars)
|
For the three
months
ended September 30
|
For the nine
months
ended September 30
|
|
2021
|
2020
|
2021
|
2020
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
$
|
22,355,658
|
$
|
14,819,622
|
$
|
66,649,723
|
$
|
37,059,011
|
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold
|
|
14,216,903
|
|
9,337,086
|
|
42,372,402
|
|
22,840,645
|
|
|
|
|
|
|
|
|
|
|
Gross
Profit
|
|
8,138,755
|
|
5,482,536
|
|
24,277,321
|
|
14,218,366
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
Fulfillment costs
|
|
2,374,704
|
|
2,395,634
|
|
6,855,014
|
|
6,382,115
|
|
Selling and
marketing
|
|
2,968,055
|
|
1,971,881
|
|
8,359,299
|
|
5,444,591
|
|
Administration
|
|
3,609,064
|
|
1,566,850
|
|
11,151,304
|
|
4,884,990
|
|
Research and
development
|
|
472,539
|
|
(222,797)
|
|
1,298,102
|
|
(310,015)
|
|
Depreciation and
amortization
|
|
794,995
|
|
168,970
|
|
2,746,238
|
|
614,420
|
|
|
10,219,357
|
|
5,880,538
|
|
30,409,957
|
|
17,016,101
|
|
|
|
|
|
|
|
|
|
|
Loss from
operations
|
|
(2,080,602)
|
|
(398,002)
|
|
(6,132,636)
|
|
(2,797,735)
|
|
|
|
|
|
|
|
|
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
23,836
|
|
36,004
|
|
64,106
|
|
92,592
|
|
Interest expense
|
|
(527,408)
|
|
(183,823)
|
|
(1,829,265)
|
|
(591,192)
|
|
Finance costs)
|
|
(374,652)
|
|
-
|
|
(1,444,745)
|
|
-
|
|
Rental income
|
|
61,154
|
|
47,700
|
|
161,710
|
|
357,159
|
|
Fair value adjustment of
convertible
debt and
warrants
|
|
4,964,539
|
|
-
|
|
(1,455,090)
|
|
-
|
|
Foreign exchange
gain
|
|
98,063
|
|
301,735
|
|
9,899
|
|
382,595
|
|
Gain on sublease
|
|
-
|
|
-
|
|
-
|
|
129,148
|
|
Listing expenses
|
|
(1,017,659)
|
|
-
|
|
(1,017,659)
|
|
-
|
|
|
3,227,873
|
|
201,616
|
|
(5,511,044)
|
|
370,302
|
|
|
|
|
|
|
|
|
|
|
Income/(loss) before
income taxes
|
|
1,147,271
|
|
(196,386)
|
|
(11,643,680)
|
|
(2,427,433)
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
(474,031)
|
|
-
|
|
(1,283,537)
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Net income/(loss) and
comprehensive income/(loss) for the period
|
$
|
673,240
|
$
|
(196,386)
|
$
|
(12,927,217)
|
$
|
(2,427,433)
|
|
|
|
|
|
|
|
|
|
|
Deficit, beginning of
period
|
$
|
(121,879,818)
|
$
|
(105,951,172)
|
$
|
(108,279,361)
|
$
|
(103,720,125)
|
|
|
|
|
|
|
|
|
|
|
Deficit, end of
period
|
$
|
(121,206,578)
|
$
|
(106,147,558)
|
$
|
(121,206,578)
|
$
|
(106,147,558)
|
|
|
|
|
|
|
|
|
|
|
Loss per
share (expressed in $ per share):
|
|
|
|
|
|
|
|
|
|
Basic loss per
share
|
|
0.02
|
|
(0.01)
|
|
(0.44)
|
|
(0.11)
|
|
Diluted loss per
share
|
|
0.02
|
|
(0.01)
|
|
(0.44)
|
|
(0.11)
|
|
|
|
|
|
|
|
|
|
Condensed Consolidated Interim Statement of Cash Flows
(Unaudited)
(Expressed in United States
dollars)
|
For the three months
ended
September 30
|
For the nine months
ended
September 30
|
|
2021
|
2020
|
2021
|
2020
|
|
|
|
|
|
|
Cash provided by
(used in):
|
|
|
|
|
|
Operating
activities:
|
|
|
|
|
|
Net
income (loss) for the period
|
$
|
673,240
|
$
|
(196,386)
|
$
|
(12,927,217)
|
$
|
(2,427,433)
|
|
Add
(deduct) adjustments and items not affecting cash:
|
|
|
|
|
|
Depreciation
|
794,995
|
168,970
|
2,746,238
|
614,420
|
|
Income tax
expense
|
474,031
|
-
|
1,283,537
|
-
|
|
Stock-based
compensation expense
|
196,284
|
57,520
|
1,250,114
|
172,561
|
|
Other interest
and finance cost
|
428,276
|
113,271
|
1,516,191
|
331,980
|
|
Interest on
leases
|
99,132
|
70,552
|
313,075
|
259,212
|
|
Interest earned
on lease receivables and other
|
(23,836)
|
(36,005)
|
(64,106)
|
(92,592)
|
|
Fair value
adjustment on convertible debt and
warrants
|
(4,964,539)
|
-
|
1,455,090
|
-
|
|
Finance
costs
|
374,652
|
-
|
1,444,745
|
-
|
|
Listing
expenses
|
1,017,659
|
-
|
1,017,659
|
-
|
|
Unrealized
foreign exchange (gain) loss
|
(106,672)
|
86,201
|
(2,693)
|
(101,301)
|
|
Gain on lease
modification
|
-
|
-
|
-
|
(129,148)
|
|
(1,036,778)
|
264,123
|
(1,967,367)
|
(1,372,301)
|
|
Changes in non-cash
operating working capital:
|
|
|
|
|
|
Short-term
investments
|
-
|
-
|
-
|
(83,000)
|
|
Trade and other
receivables
|
(248,624)
|
64,327
|
(496,573)
|
62,519
|
|
Inventories
|
(362,857)
|
355,623
|
(757,175)
|
(137,978)
|
|
Prepaid
materials, expenses and deposits
|
29,693
|
(108,352)
|
179,483
|
1,235,941
|
|
Advances to
vendors
|
(1,519,636)
|
(56,407)
|
(2,479,256)
|
347,061
|
|
Accounts payable
and accrued liabilities
|
2,193,898
|
1,394,718
|
4,081,745
|
2,158,478
|
|
Deferred
revenue
|
(433,406)
|
(1,945,101)
|
1,157,391
|
(678,864)
|
|
Total operating
activities
|
(1,377,710)
|
(31,069)
|
(281,752)
|
1,531,856
|
|
|
|
|
|
|
Investing
activities:
|
|
|
|
|
|
Purchase
of property and equipment
|
(26,081)
|
(98,672)
|
(54,730)
|
(105,508)
|
|
Principal received on lease receivables
|
56,384
|
51,548
|
165,430
|
151,241
|
|
Interest
received
|
23,836
|
36,005
|
64,106
|
92,592
|
|
Cash
acquired from reverse acquisition
|
220,920
|
-
|
220,920
|
-
|
|
Total investing
activities
|
275,059
|
(11,119)
|
395,726
|
138,325
|
|
|
|
|
|
|
Financing
activities:
|
|
|
|
|
|
Subscription receipts proceeds
|
-
|
-
|
16,177,383
|
-
|
|
Restricted cash related to subscription receipts
|
15,032,370
|
-
|
(74,921)
|
-
|
|
Subscription receipts issuance costs
|
(374,652)
|
-
|
(1,444,745)
|
-
|
|
Proceeds
from exercise of stock options
|
7,097
|
-
|
17,265
|
-
|
|
Principal lease payments
|
(234,520)
|
(153,198)
|
(744,902)
|
(517,046)
|
|
Interest
paid
|
(431,864)
|
(183,823)
|
(1,471,445)
|
(591,192)
|
|
Loan
repayment
|
-
|
-
|
(114,382)
|
-
|
|
Total financing
activities
|
13,998,431
|
(337,021)
|
12,344,253
|
(1,108,238)
|
|
|
|
|
|
|
Increase/(Decrease)
in cash and cash equivalents
|
12,895,780
|
(379,209)
|
12,458,227
|
561,943
|
|
|
|
|
|
|
Cash and cash
equivalents, beginning of period
|
4,978,958
|
4,398,665
|
5,416,511
|
3,457,513
|
|
|
|
|
|
|
Cash and cash
equivalents, end of period
|
$
|
17,874,738
|
$
|
4,019,456
|
$
|
17,874,738
|
$
|
4,019,456
|
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SOURCE BuildDirect.com Technologies Inc.