Third Quarter Highlighted by Improved Revenue
and Adjusted EBITDA Growth
TORONTO, Nov. 22,
2022 /CNW/ - Pluribus Technologies Corp. (TSXV: PLRB)
("Pluribus" or the "Company"), a growing acquiror of
small, profitable technology companies, today announced its
unaudited financial results for the third quarter ended
September 30, 2022. The Company's
condensed consolidated interim financial statements and
accompanying notes for the quarters ended September 30, 2022 and 2021 (the "Q3
Financials") are available under Pluribus' profile on SEDAR
(www.sedar.com). All dollar amounts are in thousands of Canadian
dollars unless otherwise noted. Certain metrics, including Adjusted
EBITDA, are non-IFRS measures (see "Non-IFRS Measures" below).
"The improvement in both revenue and Adjusted EBITDA for both
the quarter and year-to-date periods reflects progress made in the
integration process of the five acquisitions completed over the
past twelve months," said Richard
Adair, CEO of Pluribus Technologies. "Our focus through the
balance of the year will be on executing our sales and marketing
and business development strategies to drive organic growth from
this growing group of businesses. We continue to maintain a strong
pipeline of acquisition targets, but intend to be selective in how
we deploy capital through the balance of the year to ensure both
our ability to maximize the value associated with any new
transaction, while also preserving capital should challenging
macroeconomic conditions persist well into 2023."
Selected Financial and Business Highlights for the Third
Quarter
- Revenue for the three and nine months ended September 30, 2022 was $10.8 million and $28.1
million, increasing by 66% and 139%, respectively,
reflecting the five acquisitions completed since September 30, 2021.
- Adjusted EBITDA1 for the three months ended
September 30, 2022 was $2.1 million, and $4.0
million for the year-to-date period, up from $1.1 million and $0.7, respectively, in the prior in the
comparative periods a year ago. The increase in Adjusted EBITDA
reflects the contribution from the five acquisitions closed since
the comparable period, net of higher corporate and public company
costs.
- Net loss for the quarter ended September
30, 2022 was $1.9 million,
which decreased from a loss of $3.0
million for the comparable period. For the nine months ended
September 30, 2022, net loss was
$9.4 million compared with
$8.3 million in the same period of
2021. The decrease in net loss for the quarter is primarily driven
by higher operating income and no transaction costs as compared to
the prior period.
- Cash on hand on September 30,
2022 was $5.6 million compared
with $1.7 million on December 31, 2021. As of September 30, 2022 the Company has not drawn upon
it's $3.0M revolving line of
credit.
1 Adjusted
EBITDA is a non-IFRS measure as described in the "Non-IFRS
Measures" section of this news release. These measures are not
recognized measures under IFRS, do not have a standardized meaning
under IFRS and are therefore unlikely to be comparable to similar
measures presented by other companies.
|
Results of Operations
(000's)
|
Three
Months
|
|
Nine
Months
|
For the period ended
September 30,
|
2022
|
2021
|
Var
|
Var
|
|
2022
|
2021
|
Var
|
Var
|
$
|
$
|
$
|
%
|
|
$
|
$
|
$
|
%
|
|
|
|
|
|
|
(Restated)
|
|
|
|
Revenue
|
10,746
|
6,470
|
4,276
|
66 %
|
|
28,057
|
11,720
|
16,337
|
139 %
|
|
|
|
|
|
|
|
|
|
|
Gross Profit
|
6,887
|
4,433
|
2,454
|
55 %
|
|
18,061
|
8,806
|
9,255
|
105 %
|
Operating
Expenses
|
4,816
|
3,305
|
1,511
|
46 %
|
|
13,998
|
8,077
|
5,921
|
73 %
|
Non-Operational
Expenses
|
4,442
|
4,338
|
104
|
2 %
|
|
14,082
|
9,147
|
4,935
|
54 %
|
Net Loss
|
(1,907)
|
(2,994)
|
1,087
|
36 %
|
|
(9,444)
|
(8,346)
|
(1,098)
|
-13 %
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
2,071
|
1,128
|
943
|
84 %
|
|
4,063
|
729
|
3,334
|
457 %
|
Adjusted EBITDA
%
|
19.3 %
|
17.4 %
|
|
1.8 %
|
|
14.5 %
|
|
|
8.3 %
|
Restatement of Results
In the current period, the Company identified that it had over
estimated revenue and receivables from a eCommerce marketplace
provider within the Company's eCommerce operating segment for the
three months ended March 31, 2022 and
the three and six months ended June 30,
2022 period. This was caused by a change in the revenue
share agreement initiated by this provider that was misinterpreted
by the Company, which has since been reconciled in the Q3
Financials.
As a result, the Company restated its previously reported
consolidated statements of loss and comprehensive loss for the
first two quarters of 2022 in the Q3 Financials and related
management's discussions and analysis. No periods other than the
first two quarters of 2022 were affected and there was no impact on
previously reported cash flows from operating, investing, or
financing activities.
Outlook
Pluribus is currently operating in four verticals: eLearning,
eCommerce, Health Tech and Digital Enablement. The Company's
strategy is to acquire technology businesses that are owner
operated, less than $10 million in
revenue and have normalized EBITDA margins of 20-30%.
Operationally, we generally expect to grow these acquisitions
profitably following the completion of the integration of the
business and the subsequent roll out of our sales and business
development plans, which typically takes six to twelve months. As
of the date of this financial report, we have completed four
acquisitions so far in 2022. In the near term, our primary focus is
to further integrate these companies and generate organic growth
primarily through improved sales and marketing execution and, where
possible, cross-selling. While the broader operating environment is
currently more challenging for some of our businesses, management
is focused on continued growth in Adjusted EBITDA and Adjusted
EBITDA margins. The pipeline of acquisition opportunities remains
robust, as owner-operators continue to look for succession options
for their businesses. Pluribus will continue evaluating
EBITDA-accretive acquisitions to scale up our existing vertical
business units, expand into new ones on an opportunistic basis, as
well as grow revenue and further expand our product offering.
Conference Call Details
Pluribus' management team will host a conference call to discuss
its fiscal 2022 third quarter financial results on Wednesday, November 23, 2022.
Date: Wednesday, November 23,
2022
Time: 8:30 am EDT
Dial-In Numbers: (416) 764-8650 or (888) 664-6383
Conference ID: 25292436
Webcast: Available on the Events & Presentations page of
the Company's investor website
Replay: (416) 764-8677 or (888) 390-0541 (playback code:
810434#) – available until midnight (EDT) on November 30, 2022
About Pluribus Technologies Corp.
Pluribus is a
technology company that is a value-based acquirer of small,
profitable business-to-business technology companies in a range of
verticals and industries. Pluribus provides its acquisitions access
to experienced sales and marketing resources, strategic partnership
opportunities, a diverse portfolio of customers in different
geographical markets and enabling technologies to create new
revenue streams and provide the opportunity for these companies to
grow in their respective markets. For more information, please
visit:
https://www.pluribustechnologies.com/.
Non-IFRS Measures
The Company uses non-IFRS measures to assess its operating
performance. Securities regulations require that companies caution
readers that earnings and other measures adjusted to a basis other
than IFRS do not have standardized meanings and are unlikely to be
comparable to similar measures used by other companies.
Accordingly, they should not be considered in isolation. The
Company uses Adjusted EBITDA as a measure of operating performance.
Management uses Adjusted EBITDA to evaluate operating performance
as it excludes amortization of software and intangibles (which is
an accounting allocation of the cost of software and intangible
assets arising on acquisition), any impact of finance and tax
related activities, asset depreciation, foreign exchange gains and
losses, other income, restructuring and transition costs primarily
related to acquisitions and other one-time non-recurring
transactions.
Reconciliation of Non-IFRS Measures
The Company uses the non-IFRS measure Adjusted EBITDA to
evaluate performance. The following table presents the
reconciliation from net income (loss) to Adjusted EBITDA for the
three months ended September 30,
2022.
|
Three
Months
|
|
Nine
Months
|
For the period ended
September 30,
|
2022
|
2021
|
Var
|
Var
|
|
2022
|
2021
|
Var
|
Var
|
|
$
|
$
|
$
|
%
|
|
$
|
$
|
$
|
%
|
|
|
|
|
|
|
(Restated)
|
|
|
|
Total
Revenue
|
10,746
|
6,470
|
4,276
|
66 %
|
|
28,057
|
11,720
|
16,337
|
139 %
|
|
|
|
|
|
|
|
|
|
|
Net loss for the
year
|
(1,907)
|
(2,994)
|
1,087
|
36 %
|
|
(9,444)
|
(8,346)
|
(1,098)
|
-13 %
|
|
|
|
|
|
|
|
|
|
|
Acquisition
costs
|
1,389
|
837
|
552
|
66 %
|
|
3,925
|
1,364
|
2,561
|
188 %
|
Transition
costs
|
—
|
438
|
(438)
|
N/A
|
|
1,665
|
1,356
|
309
|
23 %
|
Amortization and
depreciation
|
1,471
|
943
|
528
|
56 %
|
|
3,992
|
1,594
|
2,398
|
150 %
|
Share-based
compensation
|
437
|
6
|
431
|
N/A
|
|
1,716
|
29
|
1,687
|
N/A
|
Loss from change of
fair value of financial liabilities
|
—
|
1,885
|
(1,885)
|
N/A
|
|
9
|
4,338
|
(4,329)
|
N/A
|
Loss (gain) on
revaluation of contingent consideration
|
—
|
—
|
—
|
N/A
|
|
—
|
(31)
|
31
|
N/A
|
Finance expense,
net
|
624
|
261
|
363
|
139 %
|
|
1,630
|
531
|
1,099
|
207 %
|
Foreign exchange
loss
|
521
|
(32)
|
553
|
N/A
|
|
1,145
|
(34)
|
1,179
|
N/A
|
Income tax
expense
|
(464)
|
(216)
|
(248)
|
115 %
|
|
(575)
|
(72)
|
(503)
|
699 %
|
|
|
|
|
|
|
|
|
|
|
Total
Adjustments
|
3,978
|
4,122
|
(144)
|
-3 %
|
|
13,507
|
9,075
|
4,432
|
49 %
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
2,071
|
1,128
|
943
|
84 %
|
|
4,063
|
729
|
3,334
|
457 %
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
%
|
19.3 %
|
17.4 %
|
|
1.8 %
|
|
14.5 %
|
6.2 %
|
|
8.3 %
|
Forward-Looking Information
Certain information in this press release constitutes
forward-looking statements under applicable securities laws. Any
statements that are contained in this news release that are not
statements of historical fact may be deemed to be forward-looking
statements. Forward-looking information in this press release
includes, but is not limited to, statements with respect to the
business plans of the Company, including the successful completion
and pace of future acquisitions, the Company management's
expectation on the growth, profitability and performance of its
current and future acquisitions, the Company's ability to continue
acquiring business-to-business technology companies at reasonable
prices and the Company's ability to grow its portfolio companies
into significant organizations. Forward-looking statements are
often identified by terms such as "may", "should", "anticipate",
"expect", "potential", "believe", "intend" or negatives of these
terms and similar expressions.
Forward-looking statements are based on certain assumptions,
including the Company's ability to complete acquisitions on
favourable terms; the Company's ability to manage a complex
portfolio of companies effectively; the Company's ability to
scale its management team to support a rapid pace of growth; the
Company's ability to raise sufficient financing to continue the
pace of its acquisition strategy; the Company's ability to maintain
its rapid pace of growth. Other assumptions include industry
trends, the availability of growth opportunities, and general
business, economic, competitive, political, regulatory and social
uncertainties will not prevent the Company from conducting its
business. While the Company considers these assumptions to be
reasonable based on information currently available, they are
inherently subject to significant business, economic and
competitive uncertainties and contingencies and they may prove to
be incorrect. Forward-looking information speaks only to such
assumptions as of the date of this release.
Forward-looking statements also necessarily involve known and
unknown risks, including without limitation, risks associated with
general economic conditions, including the COVID-19 pandemic,
adverse industry events, marketing costs, loss of markets, future
legislative and regulatory developments, the inability to access
sufficient capital on favourable terms, the Company's limited
operating history; ability to complete favourable acquisitions; the
technology industry in Canada and
internationally, income tax and regulatory matters, the ability of
the Company to execute its business strategies, including the
ability manage a complex portfolio of companies effectively,
competition, currency and interest rate fluctuations, and other
risks.
Readers are cautioned that the foregoing is not exhaustive.
Readers are further cautioned not to place undue reliance on
forward-looking statements as there can be no assurance that the
plans, intentions or expectations upon which they are placed will
occur. Such information, although considered reasonable by
management at the time of preparation, may prove to be incorrect
and actual results may differ from those anticipated.
Forward-looking statements are not guarantees of future
performance. The purpose of forward-looking information is to
provide the reader with a description of management's expectations,
and such forward-looking information may not be appropriate for any
other purpose. Except as required by law, the Company disclaims any
obligation to update or revise any forward-looking statements,
whether as a result of new information, events or otherwise.
Forward-looking statements contained in this news release are
expressly qualified by this cautionary statement.
Neither the TSXV nor its Regulation Services Provider (as
that term is defined in the policies of the TSXV) accepts
responsibility for the adequacy or accuracy of this press
release.
SOURCE Pluribus Technologies Corp.