Revenues grew by 10% compared to Q3 2022 with solid margins contributing to increased cash flow and cash balance
TORONTO, ON / ACCESSWIRE / November 9, 2023 / Adcore Inc. (the “Company” or “Adcore”) (TSX:ADCO)(OTCQX:ADCOF)(FSE:ADQ), a leading e-commerce advertising management and automation platform to leverage digital marketing in an effortless and accessible way (“Effortless Marketing”), today announced its financial results for the three months ending September 30, 2023.
Adcore CEO, Omri Brill, commented, “I am delighted to report to shareholders another strong operating quarter and continued positive business momentum in both sales, cash flow, margins, new products and new business wins. The $8.2 million in revenues generated this past quarter was 10% higher than the $7.5 million in revenues from the third quarter in 2022, and significantly higher sequentially from our 2023 second quarter results of $6.9 million in sales. During the quarter, we also added multiple notable new clients including, Toys R Us, Runway The Label, while expanding prior relationships with important existing customers. Another major win and further evidence of our continued execution in our growth strategy was securing a new digital advertising contract with a budget of up to CAD $10 million dollars with a leading Australian health and wellness company just after quarter end. Other major milestones achieved this quarter included the launch of our new marketing cloud app, Media Blast, to help support our small business customers with their digital advertising needs.
We are also happy to report that our margins remained strong for the quarter and in line with our prior guidance of 40%-45% and thus, contributed to continued increases in both positive cash flow and our total cash position. We concluded the quarter with CAD$7.5 million in cash compared to CAD$6.2 million in the previous quarter and a total working capital of CAD$7.7 million.
Having virtually no debt and a very healthy cash position allows us cash flexibility which we will continue to use wisely to build long term shareholder value, including given the current undervalued share price, using some excess cash to buy back shares through our NCIB. As Adcore continues to grow its business and secure its place atop the digital advertising landscape, I want to thank all our staff that make this all possible. Whether it’s signing new clients, expanding existing client relationships, or releasing new products, I am excited for what the future holds and look forward to sharing our continued successes in the next quarter,” concluded Mr. Brill.
Third Quarter Highlights:
Revenue for the three months ended September 30, 2023, was CAD$8.2 million compared to CAD$7.5 million for the three months ended September 30, 2022, a 10% increase.
Gross profit for the three months ended September 30, 2023, was CAD$3.3 million compared to CAD$3.4 million for the three months ended September 30, 2022, a 5% decrease.
Gross margin for the three months ended September 30, 2023, was 40% compared to 46% for the three months ended September 30, 2022.
Adjusted EBITDA for the three months ended September 30, 2023, was CAD$240,000 compared to CAD$734,000 for the three months ended September 30, 2022, a 67% decrease.
North America revenue for the three months ended September 30, 2023, was CAD$1.65 million compared to CAD$2 million for the three months ended September 30, 2022, an 18% decrease.
EMEA revenue for the three months ended September 30, 2023, was CAD$3.91 million compared to CAD$3.24 million for the three months ended September 30, 2022, a 20% increase.
APAC revenue for the three months ended September 30, 2023, was CAD$2.66 million compared to CAD$2.24 million for the three months ended September 30, 2022, a 19% increase.
An increase of 192% in cash flow used for operating activities compared to the three months ended September 30, 2022.
Total accumulated NCIB purchases the company made until 31/10/2023 was 1,782,000 shares.
Working Capital for the nine months ended September 30, 2023, was CAD$7.7 million compared to CAD$9.2 million as of December 31, 2022.
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
Conference Call and Webcast Information
The Company will host a conference call and webcast to discuss these results on November 9th at 10AM ET.
To register for the conference call/webcast click here: https://us02web.zoom.us/webinar/register/WN_SnO_MzwYSZmLxz5-KDbXdg
Use of Non-IFRS Measures
Management uses Adjusted earnings before interest, income taxes, depreciation, and amortization (“Adjusted EBITDA”) as a key financial metric to evaluate Adcore’s operating performance and for planning and forecasting future business operations. Adjusted EBITDA excludes significant items that are non-operating in nature in order to evaluate Adcore’s core operating performance against prior periods. Adjusted EBITDA is not a measure of financial performance under GAAP and should be considered in addition to, and not as a substitute for net earnings, overall change in cash or liquidity of the business as a whole. Management believes the use of Adjusted EBITDA allows investors and analysts to understand the results of the continuing operations of the Company and its subsidiary, by excluding certain items that have a disproportionate impact on Adcore’s results for a particular period. Management’s method of determining non-GAAP financial measures is evaluated periodically and may differ from other companies’ methods and therefore may not be comparable to those used by other companies.
The following table reconciles the non-IFRS measure to the most comparable IFRS measure for the three months ended September 30, 2023. This measure does not have any standardized meaning under IFRS and is not a measure of financial performance under IFRS, and therefore, may not be comparable to similar measures presented by other companies.
Adcore is a leading AI-powered marketing and online learning technology company.
By combining extensive industry knowledge and experience with its proprietary artificial intelligence (AI) powered technology, Adcore offers a unique digital marketing solution that empowers entrepreneurs and advertisers by managing and automating their e-commerce store advertising and monitoring and analyzing the performance of their advertising budget to ensure maximum Return on Investment. Adcore is a certified Google Premier Partner, Elite Tier Microsoft Partner, Facebook Partner and TikTok Partner.
Adcore also runs Amphy, the world’s most diverse 24/7 live online learning marketplace. Learners can choose from thousands of classes across hundreds of categories to grow their passions, skills and expand their children’s learning opportunities. Instructors on the Amphy platform join a vibrant virtual teacher community that promotes and supports their success through enrichment seminars, marketing and advertising, and a suite of tools that allow them to run their classes hassle-free and focus on their students. Amphy students gain access to high-quality, personalized classes that are accessible 24/7, while joining a growing community of lifelong learners.
Established in 2006, the Company employs over fifty people in its headquarters in Tel Aviv, Israel and satellite offices in Toronto, Canada, Melbourne, Australia, Hong Kong and Shanghai, China.
For more information about Adcore, please visit https://www.adcore.com/investors/, https://www.adcore.com/blog or follow us on LinkedIn. For more information about Amphy please visit https://www.amphy.com/ and https://blog.amphy.com/ or follow us on LinkedIn, Facebook, Instagram and YouTube.
This press release contains or may contain certain forward-looking statements, including statements about the Company. Wherever possible, words such as “may”, “will”, “should”, “could”, “expect”, “plan”, “intend”, “anticipate”, “believe”, “estimate”, “predict” or “potential” or the negative or other variations of these words, or similar words or phrases, have been used to identify these forward-looking statements. These statements reflect management’s current beliefs and are based on information currently available to management as at the date hereof.
Forward-looking statements involve significant risk, uncertainties and assumptions. Many factors could cause actual results, performance or achievements to differ materially from the results discussed or implied in the forward-looking statements. These factors should be considered carefully and readers should not place undue reliance on the forward-looking statements. Although the forward-looking statements contained in this press release are based upon what management believes to be reasonable assumptions, the Company cannot assure readers that actual results will be consistent with these forward-looking statements. These forward-looking statements are made as of the date of this press release, and the Company assumes no obligation to update or revise them to reflect new events or circumstances, except as required by law.
FUTURE ORIENTED FINANCIAL INFORMATION
Any financial outlook or future oriented financial information contained in this press release, as such term is defined by applicable securities laws, has been approved by management of Adcore as of the date hereof and is provided for the purpose of providing information about management’s current expectations and plans relating to the new digital advertising contract with a health and wellness company based in Australia. Readers are cautioned that any such future oriented financial information contained herein should not be used for purposes other than those for which it is disclosed herein. The Company and its management believe that the prospective financial information has been prepared on a reasonable basis, reflecting management’s best estimates and judgments. However, because this information is highly subjective, it should not be relied on as necessarily indicative of future results.
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