- Revenues grow 88% year over year to $2.18 million in quarter -Toronto, ON – August 7, 2019 – VersaPay Corporation (TSXV: VPY) (“VersaPay” or the “Company”), a leading provider of cloud-based invoice-to-cash solutions including electronic invoice presentment and payment, automated collections and cash application, today announced its financial results for the three and six-month periods ended June 30, 2019. “I’m pleased to announce that VersaPay continued its strong growth for a third consecutive quarter, with total revenues increasing 88% year-over-year to $2.18 million,” said Craig O’Neill, CEO of VersaPay. “ARCTM continues to be our primary growth driver with growth of 156% year-over-year to $1.66 million. Our recurring business (ARR) is approximately $7.50 million at the end of the quarter with ARCTM representing approximately 73% of this figure. As a result, our gross margins were positively impacted, growing to 81% this quarter, up from 75% in Q2 2018.” Mr. O’Neill continued, “Our new ARCTM sales of $0.92 million and professional services sales of $0.42 million in the quarter resulted in an increase to the subscription and professional services backlog to $1.18 million and $0.83 million, respectively. We expect the bulk of this backlog will translate to revenue in the coming one to two quarters.”
Operational Highlights for Q2:
- Partnership with MasterCard: During the quarter, VersaPay successfully completed a deal with MasterCard, a leading global payments leader, to partner together to introduce a Virtual Card Receivables Service. This Virtual Card Receivables Service will aggregate information from MasterCard Issuers related to Virtual Card payments by their corporate customers and compile it into one comprehensive file, available in a digital format that is preferred by suppliers. The solution eliminates the manual process of reconciling incoming payment information. This joint initiative will improve the experience of accepting virtual credit cards for businesses across the US, Canada, and around the globe.
- Strong quarter for ARC™ sales: 15 new ARCTM wins during the quarter that represented over $0.92 million in new ARCTM ARR, with about 34% of sales coming through channel partners. From a geographic standpoint, 85% of sales came from the U.S. Moreover, the Company signed professional services contracts worth approximately $0.42 million in the quarter representing the highest quarter of such sales to-date.
- High conversion of backlog to ARC™ Revenue: The Company converted approximately 69% of its ARCTM subscription backlog (which are contractually signed but unbilled clients) as of March 31, 2019 to revenue in the quarter, while growing its backlog of clients from $1.10 million at the end of Q1, 2019 to $1.18 million at the end of Q2 2019. This signals a healthy growth in the business, and continued revenue growth in the near term.
- Continued growth in ARC™ usage metrics: The usage of ARCTM is an important indicator of the value clients are receiving from the platform and a good predictor of continued sales and revenue growth. As at the end of the quarter, 182,435 end-customers were using ARCTM compared to 117,578 at the end of Q2 2018, and approximately 679,000 invoices were delivered to end-customers during the quarter compared to 451,000 invoices in Q2 2018. 279,000 invoices worth $266 million were paid on ARCTM in Q2 2019, compared to 203,000 invoices worth $149 million in Q2 2018.
- Total Revenue for Q2 2019 increased by 88% to $2.18 million compared to $1.18 million in Q2 2018.
- Gross margin percentage for the three-month period ended June 30, 2019 was 81%, compared to 75% in Q2 2018.
- ARCTM ARR increased to $5.50 million compared to $2.30 million in Q2 2018 and $4.57 million in Q1 2019. This represents an increase of 139% year-over-year, and an increase of 20% quarter-over-quarter.
- PayPortTM ARR grew to $1.99 million, bringing our total recurring revenue to a run rate of approximately $7.50 million at the end of Q2 2019, compared to $4.22 million in the prior year, an increase of 78%.
- Operating expenses increased by $0.53 million to $5.03 million (Q2 2018: $4.50 million), an increase of 12% year over year. The increase is comprised of various research & development costs, and marketing and promotion activities which are required to support the growing revenue trend of the business.
- Adjusted EBITDA was a loss of $2.62 million in Q2 2019, compared to a loss of $2.81 million in Q2 2018.
|John McLeod Vice President, Marketing VersaPay Corporation 647-258-9406 firstname.lastname@example.org||Babak Pedram Investor Relations Virtus Advisory Group Inc. 416-644-5081 email@example.com|
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