Wishpond Reports Continued Revenue and Adjusted EBITDA Growth in Q3-2023

• Wishpond achieved Adjusted EBITDA of $0.3 million, representing the fifth quarter in a row of positive Adjusted EBITDA.
• Wishpond achieved revenue of $5.8 million in Q3-2023 and expects continued growth and improved cash flows in the last quarter of 2023.

VANCOUVER, BC, Nov. 16, 2023 /CNW/ - Wishpond Technologies Ltd. (TSXV: WISH) (OTCQX: WPNDF) (the "Company" or "Wishpond"), a provider of marketing-focused online business solutions, announces it has filed its interim consolidated financial statements (the "Interim Financial Statements'') and management's discussion and analysis (the "MD&A") for Q3-2023, representing the three and nine months ended September 30, 2023. Copies of the Interim Financial Statements and MD&A are available on the Company's profile on SEDAR at www.sedar.com.

Ali Tajskandar, Wishpond's Founder and CEO commented, "The first nine months have been a period of transition in which we launched Propel IQ, the Company's next generation marketing platform, and then re-trained and re-structured our sales team to sell this new bundled product offering. This has resulted in slower growth in 2023; however, we are now experiencing an acceleration of Propel IQ sales and have thus resumed the expansion of our sales team. Over the past two months we averaged over 3% month-over-month growth in MRR driven by increased sales of Propel IQ, which is also having an impact on increasing gross margins and lowering customer churn."

Ali Tajskandar further adds, "In the third quarter we continued our streak of achieving positive Adjusted EBITDA for the fifth quarter in a row. Wishpond's cost optimization efforts over the past year have contributed to the Company's continued positive Adjusted EBITDA profile. We maintain a positive outlook for the remainder of 2023 and look forward to next year with renewed optimism based on continued sales growth and improving cash flows. In addition, Wishpond is leading the innovation and development of AI powered marketing tools. We are garnering significant interest for our AI products including AI Website Builder, Braxy AI Ad Manager, Sales Email AI and the soon to be launched SalesCloser AI."

Third Quarter 2023 Financial Highlights:

• Wishpond achieved quarterly revenue of $5,763,847 during Q3-2023, compared to $5,483,256 generated in the same period of 2022 (Q3-2022). Revenue growth was primarily driven by organic growth resulting from stronger product demand, an increase in sales and marketing activities, and new product introductions.
• Wishpond achieved Gross Profit of $3,825,821 in Q3-2023 (Q3-2022: $3,629,111), driven by an increase in overall revenue.
• Wishpond achieved a Gross Margin percentage of 66% during Q3-2023 (Q3-2022: 66%).
• During Q3-2023, Wishpond achieved positive Adjusted EBITDA⁽¹⁾ of $319,001 (Q3-2022: $593,047).
• Wishpond generated positive cash flow from operations of $225,367 in Q3-2023 (Q3-2022: ($208,054))
• As at September 30, 2023, Wishpond had $909,796 in cash and no debt (December 31, 2022: cash of $2,692,644 and no debt). The reduction in cash balances was caused in part by earnout payments for businesses acquired in 2022, investment in the business and changes in working capital.

Third Quarter 2023 Business Highlights:

• On July 27, 2023, the Company announced the launch of a new partnership program introducing a transformative approach to collaboration for affiliates, marketing agencies, and other technology companies to collaborate closely with Wishpond's marketing platform.
• On August 11, 2023, the Company successfully renewed its credit facility with a major Canadian bank that was originally entered into on September 21, 2021. The renewed credit facility maintains the secured revolving operating line with a borrowing capacity of up to $6,000,000 based on recurring revenue, an interest rate equal to the Canadian Prime Rate plus 2.0% per annum and is secured against the Company's assets.
• On August 16, 2023, the Company announced the upcoming launch of SalesCloser AI, an AI-powered sales rep that can deliver personalized, round-the-clock sales calls and product demos without the need for human intervention. The AI-powered platform is poised to transform industries across the board, particularly benefiting virtual sales professionals, SaaS companies, consultants, and various B2B enterprises that rely on online sales interactions.
• On September 5, 2023, the Company announced a partnership with Fiverr International Ltd. ("Fiverr") to be part of its Fiverr Certified program and create a unique and certified freelance marketplace for the Propel IQ platform. The Fiverr Certified team will selectively scout skilled professionals and agencies, both internally and from Wishpond's existing partner network. Fiverr will then onboard qualified professionals onto the co-branded marketplace, primed to provide exceptional services to Wishpond's small and medium-sized business "SMB" customers. Wishpond plans to leverage this marketplace to better service its SMB customers and broaden its market presence in regions where the Company does not service users.
• On September 26, 2023, the Company announced the launch of Sales Email AI. Engineered to deliver tailored responses to emails from potential clients, Wishpond anticipates that Sales Email AI will provide its users a level of personalization that sets it apart from traditional automated responses. Designed to elevate and streamline sales communications, Sales Email AI will be a new feature of PersistIQ, Wishpond's outbound sales solution.

Business Highlights Subsequent to September 30, 2023:

• On October 3, 2023, the Company announced the integration of Brax with Facebook, a strategic enhancement in the way that businesses manage their advertising campaigns on the world's largest social media platform. This new integration paves the way for advertisers to harness the power of Brax's advanced ad creation tools and robust rules engine, enhancing their return on investment while streamlining their ad management processes.

Outlook:

Wishpond expects to achieve record revenue and Adjusted EBITDA in 2023, driven by organic growth from increasing sales of the Company's new Propel IQ bundled product, in addition to ramping up the size of its sales team and launching new AI-powered products. The Company continues to have an active pipeline of sales opportunities and robust demand for its products. Management is pleased to re-iterate the Company's key goals for 2023:

• Increase Monthly Recurring Revenue through both organic and inorganic means.
• Scale the size of the sales team to help achieve the Company's organic growth profile.
• Remain Adjusted EBITDA positive by balancing growth with increased positive cash flow from operations.
• Invest in Research and Development so that the Company can continue to launch new AI powered products and services to increase long-term value for its clients.
• Leverage the Propel IQ platform to further accelerate the Company's growth, improve margins, and increase customer retention and long-term customer value.

Wishpond has demonstrated a disciplined capital allocation strategy, having successfully completed and integrated six acquisitions since the Company's public listing in December of 2020. Given management's successful acquisition track record, the Company may choose to accelerate its growth in the form of future acquisitions. Management may also choose to reinvest cash flows generated by the Company to accelerate organic growth or in the form of share repurchases.

David Pais, Wishpond's Chief Financial Officer commented, "Our cash balance at the end of Q3-2023 experienced a small decline compared to the prior quarter Q2-2023, partly due to a cash earn-out of approximately $100K in the quarter. I am pleased to report that the Company's last cash earn-out payment will be in Q4-2023 and we expect our cash balance to improve in 2024. We feel confident in our ability to fund the Company's future growth through cash flow from operations. We look forward to reporting higher revenue growth and profitability in 2024."

Webinar Conference Call Details:

As previously announced, Wishpond will be hosting a webinar conference call to discuss its Q3-2023 financial results today at 10:00 AM (PT) / 1:00 PM (ET).

To register for the webinar, please visit the following URL: https://bit.ly/Results_Q3_2023

Date:	November 16, 2023
Time:	10:00 AM PT (1:00 PM ET)
Dial-in:	[phone] (Vancouver local)
	[phone] (Toronto local)
Meeting ID #:	851 3340 7536

 

Please connect 5 minutes prior to the conference call to ensure time for any software download that may be required.

Selected Financial Highlights: 

The tables below set out selected financial information relating to Wishpond and should be read in conjunction with Wishpond's Interim Financial Statements and MD&A.

		Three months ended	Three months ended	Nine months ended	Nine months ended
		September 30, 2023	September 30, 2022	September 30, 2023	September 30, 2022
		$	$	$	$
Revenue		5,763,847	5,483,256	17,027,081	14,568,916
Gross profit		3,825,821	3,629,111	11,195,550	9,526,021
Gross margin		66 %	66 %	66 %	65 %
Adjusted EBITDA(1)		319,001	593,047	744,000	(39,668)
Cash - end of the period		909,796	2,257,127	909,796	2,257,127

 

Reconciliation to Adjusted EBITDA

		Three months ended	Three months ended	Nine months ended	Nine months ended
		September 30, 2023	September 30, 2022	September 30, 2023	September 30,  2022
		$	$	$	$
Income (loss) before income taxes		329,154	(145,127)	(1,106,096)	(2,148,921)
Depreciation and amortization		390,353	341,681	1,139,504	937,651
Interest income		-	(234)	(2,728)	(3,690)
Interest expense		8,990	-	8,990	-
Remeasurement of contingent consideration liability		-	(49,127)	(22,232)	(40,612)
Other expenses		111,764	178,127	376,009	453,889
Stock based compensation expense		(521,260)	267,727	350,553	762,015
Adjusted EBITDA		319,001	593,047	744,000	(39,668)

 

Footnotes:
(1)	EBITDA and Adjusted EBITDA are not financial measures recognized by International Financial Reporting Standards ("IFRS"), do not have any standardized meaning prescribed by IFRS and therefore may not be comparable to similar measures presented by other entities. See "Cautionary Statements – Non-GAAP Financial Measures".

 

On Behalf of the Board of Wishpond
"Ali Tajskandar"
Chairman and Chief Executive Officer

About Wishpond Technologies Ltd.

Based out of Vancouver, British Columbia, Wishpond is a provider of marketing-focused online business solutions. Wishpond is a leading provider of digital marketing solutions that empower entrepreneurs to achieve success online. The Company's Propel IQ platform offers an "all-in-one" marketing suite that provides companies with marketing, promotion, lead generation, ad management, referral marketing, sales conversion and outbound sales automation capabilities on one integrated platform. Wishpond replaces disparate marketing solutions with an easy-to-use product, for a fraction of the cost. Wishpond serves over 4,000 customers who are primarily small and medium-sized businesses (SMBs) in a wide variety of industries. The Company has developed cutting-edge marketing technology solutions including an artificial intelligence (AI) powered website builder and continues to add new features and applications. The Company employs a Software-as-a-Service (SaaS) business model where most of the Company's revenue is subscription-based recurring revenue which provides excellent revenue predictability and cash flow visibility. Wishpond is listed on the TSX Venture Exchange under the ticker "WISH", and on the OTCQX Best Market under the ticker "WPNDF". For further information, visit: www.wishpond.com.

Cautionary Statements, Summary Information

Information presented in this press release may be only a summary of all available information and does not purport to be a full representation of all figures, notes and discussions provided for in the Interim Financial Statements and MD&A. Readers are cautioned to read the entirety of the Interim Financial Statements and MD&A, and to not rely only on the information presented in this press release. In the event of conflict between the provisions of this press release on the one hand, and the Interim Financial Statements and MD&A on the other hand, the information in the Interim Financial Statements and MD&A shall govern.

Non-GAAP Financial Measures

In this press release, Wishpond has used the following terms ("Non-GAAP Financial Measures") that are not defined by IFRS, but are used by management to evaluate the performance of Wishpond and its business: adjusted earnings before interest, taxes, depreciation and amortization ("Adjusted EBITDA"), monthly recurring revenue. These measures may also be used by investors, financial institutions and credit rating agencies to assess Wishpond's performance and ability to service debt. Non-GAAP Financial Measures do not have standardized meanings prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Securities regulations require that Non-GAAP Financial Measures are clearly defined, qualified and reconciled to their most comparable IFRS financial measures. Except as otherwise indicated, these Non-GAAP Financial Measures are calculated and disclosed on a consistent basis from period to period. Specific items may only be relevant in certain periods. See the disclosure under the heading "Additional GAAP and Non-GAAP Measures" in Wishpond's MD&A for a discussion of Non-GAAP Financial Measures and certain reconciliations to GAAP financial measures. The intent of Non-GAAP Financial Measures is to provide additional useful information to investors and analysts, and the measures do not have any standardized meaning under IFRS. The measures should not, therefore, be considered in isolation or used as a substitute for measures of performance prepared in accordance with IFRS. Other issuers may calculate Non-GAAP Financial Measures differently. Non-GAAP Financial Measures are identified and defined as follows:

• Adjusted EBITDA: Adjusted EBITDA should not be construed as an alternative to net earnings, cash flow from operating activities or other measures of financial results determined in accordance with GAAP as an indicator of the Company's performance. The Company defines "Adjusted EBITDA" as Loss before income taxes less interest, depreciation and amortization, remeasurement of contingent consideration liability, filing fees, credit facility setup fees, earn-out remuneration, foreign currency losses (gains), acquisition related expenses, net other expenditures (income), reverse takeover listing expense, and stock-based compensation. The Company believes that Adjusted EBITDA is a meaningful financial metric as it measures cash generated from operations which the Company can use to fund working capital requirements, service future interest and principal debt repayments and fund future growth initiatives.
• Monthly recurring revenue: The Company uses monthly recurring revenue, or MRR, as a directional indicator of subscription revenue going forward assuming customers maintain their subscription plan the following month. MRR is the total of all monthly subscription plan fees paid by customers in effect on the last day of that period. If customers pay for more than one month upfront, the amount is divided by the number of months in the subscription period. Discounts are deducted prior to the calculation and one-time payments and metered based charges are excluded.

Forward-Looking Statements

Statements that are not reported financial results or other historical information are forward-looking statements or forward-looking information within the meaning of applicable securities laws (collectively, "forward-looking statements"). This press release includes forward-looking statements regarding the Company, its subsidiaries and the industries in which they operate, including statements about, among other things, all information contained under the heading "Outlook" herein, references to expected results from future operations, references to the growth of the Company's product portfolio, including whether additional AI powered products or features may be developed in the future, and the functionality and timing of such products, financial results or operational activities that may be undertaken by the Company, the results of the Company's cost-savings, research and development and other initiatives, any future acquisitions, share purchases or other activities done to grow the Company both organically or inorganically, expectations, beliefs, plans, future operations, origination of additional targets in which the Company may hold an interest and acquisition opportunities for the Company, the impact of broader economic factors including inflation and other general economic risks on the Company, business and acquisition strategies, opportunities, objectives, prospects, assumptions, including those related to trends and prospects, and future events and performance. Sentences and phrases containing or modified by words such as "expect", "anticipate", "plan", "continue", "estimate", "intend", "expect", "may", "will", "project", "predict", "potential", "targets", "projects", "is designed to", "strategy", "should", "believe", "contemplate" and similar expressions, and the negative of such expressions, are not historical facts and are intended to identify forward-looking statements. Readers are cautioned to not place undue reliance on forward-looking statements. Actual results and developments may differ materially from those contemplated by forward-looking statements. Although the Company believes that the expectations reflected in forward-looking statements in this press release are reasonable and are based on, among other things, the expectations and analysis of current market trends and opportunities of management of the Company, such forward-looking statements has been based on expectations, factors and assumptions concerning future events which may prove to be inaccurate and are subject to numerous risks and uncertainties, certain of which are beyond the Company's control, including, but not limited to, economic uncertainty and instability as a result of the ongoing inflation and supply chain issues, higher interest rate climate, tightening of credit availability and recessionary risks, pandemic related risks, wars, instability in global commodity and securities markets, shifts in consumer and institutional spending and marketing strategies, risks related to data breaches and privacy, the changing global market and competition for the products and services supplied by the Company, and the additional risk factors discussed in the continuous disclosure materials of the Company which are available under the Company's profile on SEDAR at www.sedar.com. The forward-looking statements contained in this press release are expressly qualified by this cautionary statement and are made as of the date hereof. The Company disclaims any intention and has no obligation or responsibility, except as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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SOURCE Wishpond Technologies Ltd.

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