Katipult Releases Q2 2020 Results

CALGARY, AB, Aug. 12, 2020 /CNW/ - Katipult Technology Corp. (TSXV: FUND) ("Katipult" or the "Corporation"), provider of an industry leading and award-winning cloud-based software infrastructure for powering the exchange of capital in equity and debt markets, is pleased to announce its financial results for the three and six months ended June 30, 2020.

Q2 Summary

	2020	2019				2018
($ Cdn thousands)	Q2	Q1	Q4	Q3	Q2	Q1	Q4	Q3
Subscription revenue	329	329	329	365	307	303	251	188
Integration revenue	-	31	53	22	77	160	24	122
Total revenue	329	360	382	387	384	463	275	310
Gross profit	253	295	312	311	306	377	201	229
Gross profit - percentage	76.9%	81.9%	81.7%	80.4%	79.7%	81.4%	73.1%	73.9%
Selling, general, and administrative	495	517	509	438	447	494	569	463
Research and development	219	182	161	190	212	254	257	222
Adjusted EBITDA	(325)	(267)	(219)	(242)	(224)	(238)	(511)	(471)
Net income (loss) and   comprehensive income (loss)	(620)	(728)	709	(353)	(343)	(707)	(520)	(596)

• Subscription revenue remained flat quarter over quarter but increased by 7.2% when compared to the same quarter last year.
• Integration revenue was zero during the quarter as the Corporation continues to move away from one-time revenue pricing models to higher on-going recurring revenue models with enterprise customers
• One of the Corporation's key metrics is Monthly Recurring Revenue (MRR). The focus of the management of the Corporation is to grow the MRR through targeting more established customers. Management expects this strategy to generate higher per customer recurring revenue and reduce the current number of smaller customers. The MRR as at June 30, 2020 is $110K. The Corporation had no additional MRR or loss in MRR during the quarter.
• Gross profit as a percentage of sales ("Gross Margin") was lower due to lower integration revenue partially offset by lower expenses related to cost of revenue. Gross Margin has remained above 70% for the last 10 quarters.
• EBITDA was lower quarter over quarter and year over year largely due to lower integration revenue and margins and higher personnel costs on a year over year basis.
• Cash, cash equivalents and marketable securities balance as at June 30, 2020 was $1.3 million compared to $1.9 million as at December 31, 2019.

"We continue to successfully execute on our plan to move up market as enterprise customers recognize the value of our product offering." said Gord Breese, President and CEO.

About Katipult 
Katipult (www.katipult.com) is a provider of industry leading and award-winning software infrastructure for powering the exchange of capital in equity and debt markets. Our cloud-based platform and solutions digitize investment workflow by eliminating transaction redundancy, strengthening compliance, delighting investors, and accelerating deal flow. Katipult provides unparalleled adaptability for regulatory compliance, asset structure, business model, and localization requirements.

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. 

Forward-Looking Statement
Cautionary Note Regarding Forward Looking Statements: Certain disclosure in this release, including statements regarding the increased or continued industry interest in the Corporation's product, converting existing sales interest and installations into revenue, generating new sales opportunities, effectively and efficiently utilizing the Corporation's resource and the ability to deal with business disruptions or opportunities as a result of the Covid-19 pandemic constitute forward-looking statements. In making the forward-looking statements in this release, the Corporation has applied certain factors and assumptions that are based on the Corporation's current beliefs as well as assumptions made by and information currently available to the Corporation, including, but not limited to, the Corporation's anticipated cash needs, that the cash available to the Corporation is as expected, the Corporation's product will continue to operate as expected, the industry will continue to see value in the Corporation's product, the Corporation will be able to recruit talented and experienced sales, support and other individuals required to execute the Corporation's plans, and that the Corporation's employees, consultants, customers, suppliers and other stakeholders will be able to manage successfully throughout the Covid-19 pandemic. Although the Corporation considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect, and the forward-looking statements in this release are subject to numerous risks, uncertainties and other factors that may cause future results to differ materially from those expressed or implied in such forward-looking statements. Such risk factors may include, among others, the risk that cash available to the Corporation is not as expected, failure to manage growth successfully, lengthier than anticipated sales and implementation cycle, cyber risks, risks related to cloud based solutions, failure to continue to adapt to technological change and new product development, dependence on key personnel, competition, intellectual property risks, economic conditions, the financial and economic fallout due to the Covid-19 pandemic, privacy concerns and legislation, regulatory environment, risk associated with a change in the Corporation's pricing model, risk of defects in the Corporation's solution, dependence on market growth, operational service risk, dependence on partners and delay or failure to realize anticipated benefits of key account installations. Readers are cautioned, especially in these uncertain times, not to place undue reliance on forward-looking statements. The Corporation does not intend to, and expressly disclaims any intention or obligation to, update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by law.

SOURCE Katipult Technology Corp.

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