- Revenues of US$5.6 million in
Q1-2022 compared to US$2.6 million in
Q1-2021, led by a 294% jump in CTV sales and a 64% increase in
mobile sales.
- Increase in credit line with Avidbank and cash on hand
anticipated to provide ample working capital.
- Outlook for 2022 remains strong, despite the current
macro-economic environment, as the current sales pipeline is the
strongest in the Company's history.
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CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY
ANY SECURITIES IN THE UNITED
STATES. ANY SECURITIES REFERRED TO HEREIN 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.
TORONTO, May 30, 2022
/CNW/ -- Sabio Holdings Inc. (TSXV: SBIO) (the "Company" or
"Sabio"), a leading provider of CTV/OTT advertising
platforms validated by performance, is pleased to announce its
unaudited financial results for the first quarter ended
March 31, 2022. Unless
otherwise indicated, all amounts are expressed in U.S.
dollars.
"We are pleased with our results for the first quarter of 2022.
Sabio continues to execute and take advantage of the significant
industry shift towards ad-supported CTV/Streaming," stated
Aziz Rahimtoola, CEO and founder of
the Company. "Despite the seasonal nature of our industry along
with supply shortages and other macro environment issues, we
continued our streak of double-digit organic growth, putting us in
the strongest financial position in the Company's
history."
Sajid Premji, Sabio's Chief
Financial Officer, added "on the heels of record 2021 results, the
first quarter of 2022 was the strongest first quarter in the
Company's history, and we ended the quarter with ample cash
reserves. We have further strengthened our cash
position subsequent to the quarter-end with a potential
US$3 million increase to our credit
line with Avidbank. Our sales pipeline for the rest of the
2022 is the strongest in the Company's history and we expect to
continue to deliver strong revenue growth, improve our cash flows
in the remaining quarters, and deliver positive Adjusted
EBITDA1 for the full year. We believe the Company
is well-funded to navigate through any potential foreseeable
short-term challenges that the current macro environment may
present."
1 See "Use of Non-IFRS Measures" below
First Quarter 2022 Financial Highlights
- Sabio delivered record revenues of US$5.6 million in Q1/2022, an increase of 116%
compared to Q1/2021 revenues of US$2.6
million. The Company's investments in expanding its sales
team and leadership in key regions, especially in the highly
competitive New York market, along
with investments in salesforce and data analytics targeting
political campaigns, accounted for close to 50% of the growth in
the quarter.
- CTV generated revenues of US$2.3
million in Q1/2022, compared to US$0.6 million in Q1/2021, led by Sabio's unique
"CTV powered by App Science" solutions. The Company is well
positioned to continue to take advantage of the fast growing CTV
opportunity.
- Mobile, inclusive of over-the-top (OTT) streaming, generated
revenues of US$3.3 million in
Q1/2022, up 64% from US$2.0 million
in Q1/2021. The increase in revenue was primarily driven by a
multi-year expansion of an existing client partnership, and an
increase in CTV & Mobile bundled campaigns.
- Gross Profit of US$3.4 million in
Q1/2022, compared to US$1.5 million
in Q1/2021. The 120% increase was led by higher revenues and
an improvement in gross margin to 61%, compared to 60% in
Q1/2021. The improvement in gross margin was driven by higher
contributions from CTV.
- Adjusted EBITDA1 loss of US$0.9 million in Q1/2022, compared to a loss of
US$0.5 million in Q1/2021. The higher
loss was primarily driven by investments in growth initiatives
subsequent to Q1/2021, and costs associated with employees
returning back to the office.
- Average deal size increased 59% to US$64K in Q1/2022 from US$40K in Q1/2021, led by the larger CTV
campaigns.
- As of March 31, 2022, the Company
had cash of US$4.0 million, of which
US$1.25 million was used subsequent
to quarter-end to fund our asset purchase acquisition of Vidllion,
Inc.
- As of March 31, 2022, the Company
had US$3.95 million outstanding under
its credity facility with Avidbank.
1 See "Use of Non-IFRS Measures" below
First Quarter 2022 Business Highlights:
- During the first quarter of 2022, Sabio signed the largest
contract in the Company's history (the "Contract"). The
Contract represents the 3-year expansion of Sabio's existing
partnership with an existing customer. The Contract is expected to
drive over US$10 million in revenues
to Sabio over a three-year period. The Company has already started
providing its platforms and services for use pursuant to the
Contract.
- Wholly owned subsidiary Sabio, Inc. was awarded with a Great
Place to Work® certification, which recognizes high levels of
employee satisfaction.
- The Company continued to attract top executive talent,
including the appointment of Jon
Stimmel as Chief Growth Officer and Jennifer Cabalquinto to its Board of
Directors.
Events Subsequent to March 31,
2022:
- On April 1, 2022, the Company,
through its newly formed wholly owned subsidiary, Vidillion Corp.
(formerly, Sabio Acquisition Inc.), completed the acquisition of
substantially all of the assets of Vidillion Inc.
("Vidillion"), a U.S. based Streaming TV supply-side
platform ("SSP") and technology provider for content
creators (the "Acquisition"). The Acquisition was completed
pursuant to the previously announced asset purchase agreement dated
February 18, 2022, entered between
the Company, Vidillion Corp. and Vidillion, and was partially
funded through a US$1.25 million draw
on the Company's existing line of credit with Avidbank that
occurred during the first quarter and was disbursed on April 1, 2022 .
- The Company renegotiated its existing line of credit with
Avidbank. The amended terms took effect on May 26, 2022 and includes an increase in credit
available under the line to $7
million from $4 million, with
a $5 million maximum balance
outstanding until such time certain debtholder consents are
secured. The amended terms also included certain other
accommodations, including the removal of a $250,000 cap placed on Vidillion Corp.'s eligible
accounts receivable under the line's borrowing base
guidelines. The increase in available credit is expected to
be used by the Company to fund working capital requirements in the
ordinary course.
The financial results set forth above have not been audited and
are based on a review conducted by the Company's independent
auditor, MNP LLP. The Company's auditor has not audited the
accompanying interim financial results, accordingly, does not
express an opinion with respect thereto. Furthermore, the unaudited
financial results have been reviewed by the audit committee of the
Company and approved by its board of directors. These unaudited
financial results however should not be viewed as a substitute for
audited financial statements prepared in accordance with
International Financial Reporting Standards (IFRS) and are not
necessarily indicative of the Company's results for any future
period. In addition, the results highlighted in this release are
not a comprehensive statement of the Company's financial results. A
more complete description of the Company's financial position is
provided in the Sabio's unaudited consolidated financial
statements, including the notes thereto, and management's
discussion and analysis (MD&A) for the three months
ended March 31, 2022, and March 31, 2021, which can
be found under Sabio's profile on SEDAR at www.sedar.com.
Please Note: Investors are
urged to consider closely the
disclosures in Company's annual and
quarterly reports and other public filings
available under Sabio's profile on SEDAR
at www.sedar.com
Outlook
Sabio delivered strong results in 2021, growing revenues by 84%
compared to 2020, and generating positive Adjusted
EBITDA1, as the Company's early investments in
technology positioned the Company well to take advantage of the
rapidly expanding CTV market. Management believes the market
opportunity being created by the shift from traditional TV to CTV
is in the early stages, and is poised for expansion over the coming
years. Management believes the outlook for the Company remains
positive for the year, and expects Sabio to continue to deliver
robust organic revenue growth in 2022. The investments in the
Company's sales force made late last year, coupled with the
integration of the recent Acquisition, is believed to have further
strengthened the Company's position in the burgeoning CTV/OTT
streaming advertising market. Moreover, the upcoming mid-term
elections in the U.S. is anticipated to present a substantial
revenue opportunity in the second half of 2022.
The Company's current sales pipeline is at the highest
level in the Company's history, with the vast majority of mid term
election-related opportunities yet to come to market.
Overall, despite the current challenging macroeconomic
environment, Sabio believes it is well positioned to continue to
deliver strong revenue growth and improving cash flows throughout
the remainder of the year. Sabio continues to prioritize
delivering positive Adjusted EBITDA1 for the full year
and is therefore closely monitoring all discretionary
expenditures.
The financial disclosures in this news release are subject to a
number of cautionary statements, assumptions, contingencies and
risks as set forth in this news release. The foregoing outlook and
expectations constitute forward-looking statements and financial
outlook and are qualified in their entirety by the "Forward-Looking
Statements" cautionary statement below. Readers are cautioned that
this release if for information purposes only and may not be
appropriate for other purposes.
1 See "Use of Non-IFRS Measures"
below
Conference Call:
The Company will host an investor conference call for the three
months-ending March 31, 2022, at
9:00 a.m. ET on Monday, May 30,
2022. The webinar details are below:
Date: May 30,
2022
|
|
Time: 9:00 a.m. ET
(6:00 a.m. PT)
|
|
Webinar Registration:
https://bit.ly/SBIO_FY22_Q1Results
|
|
Or dial:
|
For higher quality,
dial a number based on your current location.
|
|
Canada:
|
|
+1 778 907 2071
(Vancouver local)
|
|
+1 647 374 4685
(Toronto local)
|
|
|
Webinar ID:
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844 8586
1628
|
Please connect 5 minutes prior to the conference call to ensure
time for any software download that may be required.
About Sabio
Sabio Holdings Inc. is a technology provider in the high-growth
advertising areas of connected TV ("CTV") and over-the-top
("OTT") streaming, where viewership in 2022 is expected to
rise to over 221 million users in the
United States CTV market alone[1]. Sabio's full CTV/OTT
technology stack and services enable global distribution and
monetizes and provides analytics for content creator CTV/OTT apps
and the brands and agencies that want to partner with them. Sabio's
wholly owned subsidiary, Vidillion Corp. ("Vidillion"), is a
CTV/OTT technology pioneer (whose business was acquired subsequent
to year-end 2021) that creates and distributes ad-supported CTV/OTT
apps on platforms such as Roku, Vizio, Amazon Fire, Disney + and
others. In addition, the Company's wholly owned Sabio, Inc.
subsidiary works with major brands and agencies, through its
propriety Demand Side Platform (DSP) and ad server, to provide
targeted campaign solutions to top agencies and the brands they
represent by filling the ad slots in Vidillion and other
non-Vidillion CTV/OTT apps. Lastly, its wholly owned AppScience,
Inc. ("App Science") subsidiary, powered by its App Science™
Data Management Platform ("DMP"), has pioneered a privacy
compliant, non-cookie cross screen household graph of 55 million
validated homes that connects insights between mobile apps, CTV/OTT
apps and podcast data, along with other data points designed to
better understand consumer behaviors at scale.
For more information, visit: sabioholding.com
Use of Non-IFRS Measures
This press release makes reference to certain non-IFRS
(International Financial Reporting Standards) measures including,
but not limited to, Adjusted EBITDA. These measures do not
have a standardized meaning prescribed by IFRS and therefore they
may not be comparable to similarly titled measures presented by
other companies and should not be construed as an alternative to
other financial measures determined in accordance with IFRS.
Rather, these non-IFRS measures are provided as additional
information to complement IFRS measures by providing a further
understanding of operations from management's perspective.
Accordingly, non-IFRS measures should not be considered in
isolation nor as a substitute for analysis of financial information
reported under IFRS. Management believes that these non-IFRS
measures provide useful information to investors in measuring the
financial performance of Sabio for the reasons outlined below.
Management uses adjusted earnings before interest, income taxes,
depreciation, and amortization ("Adjusted EBITDA") as a key
financial metric to evaluate Sabio's operating performance as a
complement to results provided in accordance with IFRS. The term
"Adjusted EBITDA", as defined by management, refers to net income
(loss) before adjusting earnings for finance costs, income taxes,
stock-based compensation, amortization, non-recurring items, and
severance costs.
Management believes that the items excluded from Adjusted EBITDA
are not connected to and do not represent the operating performance
of Sabio. Management believes that Adjusted EBITDA is useful
supplemental information as it provides an indication of the
results generated by Sabio's main business activities prior to
taking into consideration how those activities are financed and
taxed as well as expenses related to stock-based compensation,
depreciation, amortization, restructuring costs, other expense
(income), and foreign exchange (gain) loss. Accordingly, management
believes that this measure may also be useful to investors in
enhancing their understanding of Sabio's operating performance. It
is a key measure used by Sabio's management and board of directors
to understand and evaluate Sabio's operating performance, to
prepare annual budgets and to help develop operating plans.
Forward-Looking
Statements
This press release may contain certain forward-looking
information and statements ("forward-looking information")
within the meaning of applicable Canadian securities legislation,
including but not limited to the Company's operations, growth and
sales expectations and business plans, the impact of the Contract
on the Company's business, the Company's outlook for 2022 and its
expectations with respect to revenue growth in 2022 and cash flow
management, that are not based on historical fact, including
without limitation statements containing the words "believes",
"anticipates", "plans", "intends", "will", "should", "expects",
"continue", "estimate", "forecasts" and other similar
expressions. Readers are cautioned to not place undue reliance on
forward-looking information. Actual results and developments may
differ materially from those contemplated by these statements. The
Company undertakes no obligation to comment on analyses,
expectations or statements made by third-parties in respect of the
Company, its securities, or financial or operating results (as
applicable). Although the Company believes that the expectations
reflected in forward-looking information in this press release are
reasonable, such forward-looking information has been based
on expectations, factors and assumptions concerning future events
that may prove to be inaccurate and are subject to numerous risks
and uncertainties, certain of which are beyond the Company's
control, including the Contract not yielding the revenue
anticipated, the effect of the macro-economic environment adversely
impacting the Company's business more than anticipated, unexpected
funding and cash flow management difficulties, and the other risk
factors disclosed in the Company's filing statement and
management's discussion and analysis (MD&A), which are
publicly available on SEDAR
at www.sedar.com. Actual financial results may
differ materially from the financial outlook provided in this press
release and the financial outlook has not been audited or reviewed.
The Company has assumed that the material factors referred to
herein will not cause such forward-looking statements and
information to differ materially from actual results or events.
However, there can be no assurance that such assumptions will
reflect the actual outcome of such items or factors. The
forward-looking information contained in this press release is
expressly qualified by this cautionary statement and is 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 information, whether as a result of
new information, future events or otherwise.
This news release shall not constitute an offer to sell or
the solicitation of an offer to buy any securities in any
jurisdiction.
Neither the TSX Venture Exchange nor its Regulation
Service Provider (as that term is defined in the policies of the
TSX Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
App Science is a trademark or registered trademark of Sabio Inc.
in the United States, Canada, and other countries.
SOURCE Sabio Holdings Inc.