Route1 Reports Record Results in Third Quarter of 2018
07 November 2018 - 10:36AM
Route1 Inc. (OTCQB: ROIUF and TSXV: ROI) (the “Company” or
“Route1”), North America's most advanced provider of
industrial-grade data intelligence, user authentication and
ultra-secure mobile workforce solutions, today announced its
third quarter (Q3) financial results for the three and nine months
ended September 30, 2018.
Statement
of operationsIn 000s of CAD dollars |
Q3 2018 |
Q2 2018 |
Q1 2018 |
Q42017 |
Q3 2017 |
Q2 2017 |
Revenue |
|
|
|
|
|
|
Subscription revenue and services |
1,684 |
1,633 |
1,264 |
1,263 |
1,177 |
1,347 |
Devices
and appliances |
13,207 |
3,936 |
388 |
109 |
159 |
24 |
Other |
4 |
7 |
32 |
48 |
2 |
- |
Total revenue |
14,895 |
5,577 |
1,684 |
1,420 |
1,338 |
1,371 |
Cost of revenue |
12,311 |
3,620 |
585 |
331 |
362 |
298 |
Gross profit |
2,584 |
1,957 |
1,100 |
1,089 |
976 |
1,073 |
Operating expenses |
2,150 |
1,891 |
1,136 |
1,164 |
1,131 |
1,151 |
Operating profit (loss) 1 |
434 |
65 |
(36) |
(75) |
(155) |
(78) |
Total other expenses 2 |
192 |
(144) |
114 |
170 |
183 |
157 |
Net income gain (loss) |
242 |
209 |
(150) |
(245) |
(338) |
(235) |
1 Before stock based compensation and patent
litigation2 Includes stock based compensation, AirWatch litigation,
gain on acquisition and foreign exchange
Subscription revenue and servicesin 000s of CAD
dollars |
Q3 2018 |
Q2 2018 |
Q1 2018 |
Q4 2017 |
Q32017 |
Q2 2017 |
Application software |
1,193 |
1,181 |
1,260 |
1,263 |
1,177 |
1,347 |
Technology as a service (TaaS) |
288 |
266 |
- |
- |
- |
- |
Other services |
203 |
186 |
4 |
- |
- |
- |
Total |
1,684 |
1,633 |
1,264 |
1,263 |
1,177 |
1,347 |
Adjusted
EBITDAin 000s of CAD dollars |
Q32018 |
Q22018 |
Q12018 |
Q42017 |
Q32017 |
Q22017 |
Gross Profit |
2,584 |
1,957 |
1,100 |
1,089 |
976 |
1,073 |
Adjusted EBITDA 3 |
627 |
272 |
46 |
24 |
(46) |
16 |
Amortization |
193 |
207 |
82 |
99 |
109 |
94 |
Operating profit (loss) |
434 |
65 |
(36) |
(75) |
(155) |
(78) |
3 Adjusted EBITDA is defined as earnings before
interest, income taxes, depreciation and amortization, stock-based
compensation, patent litigation, restructuring and other costs.
Adjusted EBITDA does not have any standardized meaning prescribed
under IFRS and is therefore unlikely to be comparable to similar
measures presented by other companies. Adjusted EBITDA allows
Route1 to compare its operating performance over time on a
consistent basis.
Route1 generated cash from operating activities
of approximately $0.5 million during Q3 2018 compared with cash
used in operating activities of $0.2 million in Q3 2017.
Non-cash working capital of $1.0 million was generated in Q3 2018
compared to $0.5 million of cash used in the same period a year
earlier. Net cash generated from the day–to-day operations
for the three months ended September 30, 2018 was $1.5 million
compared to cash used of $0.6 million in Q3 2017.
Balance sheet
extractsIn 000s of CAD dollars |
Sep
302018 |
Jun 302018 |
Mar 312018 |
Dec 312017 |
Sep 302017 |
Jun 302017 |
Cash |
2,289 |
1,084 |
600 |
1,037 |
1,408 |
2,080 |
Total current assets |
5,998 |
4,989 |
6,292 |
2,035 |
2,856 |
2,924 |
Total current liabilities |
5,559 |
4,863 |
6,292 |
1,829 |
2,534 |
2,396 |
Net working capital |
439 |
126 |
- |
206 |
322 |
528 |
Total assets |
8,198 |
7,356 |
8,646 |
3,171 |
4,081 |
4,213 |
Bank debt |
- |
- |
- |
- |
- |
- |
Total shareholders’ equity |
2,402 |
2,322 |
2,256 |
1,236 |
1,432 |
1,720 |
“I am pleased with the operating and financial
performance the GroupMobile team delivered during our recently
completed third quarter. The strong quarterly financial
results reflect the high quality execution of our Group Mobile
Int’l integration plan, closure on the July 2018 US $5.9 million
purchase order for Getac rugged devices from a US based integrated
energy company engaged primarily in electric power production and
retail distribution operations, delivering to the market cutting
edge software applications for data analytics and data security,
and the start of realizing on the inherent business value that
falls out of acquisition of Group Mobile Int’l earlier this year,”
said Tony Busseri CEO of Route1. “Of note is the positive
impact the addition of the rugged device resale business that we
purchased earlier this year. Results will vary from quarter
to quarter, as device sales can be influenced by one-time large
orders similar to the impact the US $5.9 million had on this third
quarter.
“We started our business pivot towards being an
advanced provider of solutions for the ultra-secure mobile
workforce, user authentication and data intelligence in mid-2017
and the plan is now producing better than expected results at this
point in the business model’s maturity. We expect GroupMobile
to grow organically and through acquisition over the next year and
continue to aggressively move forward on realizing on the embedded
value in our intellectual property.”
Investor Conference Call and
Webcast
Route1 will hold a conference call and web cast
to discuss the Company’s financial results and provide a business
update on Wednesday, November 7, 2018 at 9 a.m. eastern.
Participants should dial Toll-Free: 1-866-548-4713 or
Toll/International: 1-323-794-2093 at least 10 minutes prior
to the conference, pass code 1767112 . For those unable to
attend the call, a replay will be available on November 7,
2018 after 12:00 p.m. at Toll-Free 1-844-512-2921 or
Toll/International 1-412-317-6671, pass code 1767112 until 11:59 pm
on November 21, 2018.
The webcast will be presented live at
http://public.viavid.com/index.php?id=131797.
About Route1 Inc.Route1,
operating under the trade name GroupMobile, is North America's most
advanced provider of industrial-grade data intelligence, user
authentication, and ultra-secure mobile workforce solutions.
The Company helps all manner of organizations, from government and
military to private sector, to make intelligent use of devices and
data for immediate process improvements while maintaining the
highest level of cyber security. Route1 is listed on the
OTCQB in the United States under the symbol ROIUF and in Canada on
the TSX Venture Exchange under the symbol ROI. For more
information, visit: www.route1.com.
For More Information, Contact:
Tony BusseriCEO, Route1 Inc.+1 416
814-2635tony.busseri@groupmobile.com
This news release, required by applicable
Canadian laws, does not constitute an offer to sell or a
solicitation of an offer to buy any of the securities in the United
States. The securities have not been and will not be registered
under the United States Securities Act of 1933, as amended (the
"U.S. Securities Act") or any state securities laws and may not be
offered or sold within the United States or to U.S. Persons unless
registered under the U.S. Securities Act and applicable state
securities laws or an exemption from such registration is
available.
Neither the 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.
© 2018 Route1 Inc. All rights reserved. No part
of this document may be reproduced, transmitted or otherwise used
in whole or in part or by any means without prior written consent
of Route1 Inc. See
https://www.route1.com/terms-of-use/ for notice of Route1’s
intellectual property.
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