Toronto, ON – April 26, 2016 – Versapay Corporation (TSXV: VPY) (“Versapay” or the “Company”), a leading provider of cloud-based invoicing, accounts receivable management and payment solutions, today announced fourth quarter (Q4) financial results for the three and twelve-month periods ended December 31, 2015.
“We are very pleased with how 2015 wrapped up for the Company," said Craig O'Neill, CEO of Versapay. "After a slower than expected start to the year in our POS Merchant Services business, we have been able to regain ground in the second half of the year, and particularly in Q4. What's more, for the first time in the Company's history the Solutions business accounted for more than 20% of our overall revenues in Q4, growing to 16% of overall revenues for the year. As we continued to see steady growth in customer adoption, invoices presented and payments made, it is evident that the ARCTM solution is gaining acceptance in the market as a viable alternative to the traditional accounts receivable process. Looking forward, we expect to see these important metrics grow at an increasing rate as we move further into the mainstream market in the U.S."
• Versapay Solutions' revenue for the year ended December 31, 2015 increased by 76% to $0.89 million compared to $0.50 million for the year ended December 31, 2014. Solutions revenue for Q4 grew by $0.15 million or 99% compared to Q4 of 2014.
• POS Merchant Services revenue for the year ended December 31, 2015 was $4.54 million compared to $4.66 million for the year ended December 31, 2014. Excluding the impact of the one-time voluntary reimbursement provided by the Company to Chase Paymentech ("Chase") for certain rebates provided by Chase to certain point-of-sale merchants (the "Chase Rebate"), POS Merchant Services revenues would have been $4.67 million for the year ended December 31, 2015 (0.2% increase).
• Total revenue for Q4 2015 increased by 18.2% to $1.40 million compared to $1.18 million in Q4 2014. Total revenue for the year ended December 31, 2015 increased by 5.1% to $5.43 million compared to $5.17 million for the year ended December 31, 2014. Excluding the impact of the one-time Chase Rebate, total revenues would have been $5.56 million for the year ended December 31, 2015 (7.6% increase).
• Gross margin percentage for the Q4 2015 was 59%, compared to 62% in Q4 2014. Gross margin percentage for the year ended December 31, 2015 was 57%, compared to 62% for the year ended December 31, 2014. Decreasing margins in the POS Merchant Services business were offset somewhat by the increasing mix of Solutions revenues.
• Cash operating expense for the year ended December 31, 2015 increased 71% to $4.41 million compared to $2.58 million for the year ended December 31, 2014. This increase reflects the Company's growth strategy of investing in Sales & Marketing and R&D to build the Solutions business.
• Adjusted EBITDA(1) was ($1.13) million in Q4 2015, compared to ($0.85) million in Q4 2014 and Adjusted EBITDA for the year ended December 31, 2015 was ($4.54) million, compared to ($2.71) million for the same period in 2014, in accordance with the Company’s growth strategy of investing in the Solutions business.
• Total comprehensive loss for Q4 2015 was ($1.22) million compared to a loss of $(0.95) million for Q4 2014, and total comprehensive loss for the year ended December 31, 2015 was ($5.34) million compared to a loss of ($3.50) million for the same period in 2014, in keeping with the Company’s growth strategy of investing in the Solutions business.
• As at December 31, 2015, the Company had cash on hand of $3.34 million compared to $4.25 million as at September 30, 2015. (1) Adjusted EBITDA is defined as earnings before interest, taxes, depreciation, amortization, share-based payments, other income and expense, and other comprehensive income. Adjusted EBITDA is a non-IFRS financial measure which does not have any standardized meaning prescribed by IFRS and is therefore unlikely to be comparable to similar measures presented by other issuers. It should not be considered in isolation as a substitute for measures of performance prepared in accordance with IFRS.
Please refer to the Company’s management’s discussion and analysis for the quarter ended December 31, 2015 for further information on the Company’s use of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to net earnings.
Conference Call Details:
- Date: Wednesday, April 27, 2016
- Time: 9:00 AM Eastern Time
Participant Dial-in Numbers:
- Local – Toronto (+1) 416 764 8609
- Toll Free – North America (+1) 888 390 0605
- Conference ID: 83710417
Recording Playback Numbers:
- Toronto (+1) 416 764 8677
- Toll Free – North America (+1) 888 390 0541
- Passcode: 710417 #
- Expiry Date: Wednesday, May 4, 2016 9:00 AM
Please connect at least 15 minutes prior to the conference call to ensure time for any software download that may be needed to hear the webcast.
Versapay is a leading cloud-based invoice presentment and payment provider for businesses of all sizes. Versapay’s ARC software-as-a-service offering allows businesses to easily deliver customized electronic invoices to their customers, to accept credit card and EFT payments and automatically reconcile payments to their ERP and accounting software. Versapay is headquartered in Toronto, Canada and also has operations in Montreal.
Forward-looking and other cautionary statements
This news release contains “forward-looking information” which may include, but is not limited to, statements with respect to the activities, events or developments that the Company expects or anticipates will or may occur in the future. Such forward-looking information is often, but not always, identified by the use of words and phrases such as “plans,” “expects,” “is expected,” “budget,” “scheduled,” “estimates,” “forecasts,” “intends,” “anticipates,” or “believes” or variations (including negative variations) of such words and phrases, or state that certain actions, events or results “may,” “could,” “would,” “might” or “will” be taken, occur or be achieved.
These forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business. Management believes that these assumptions are reasonable. Forward-looking information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. Such factors include, among others, risks related to the speculative nature of the Company’s business, the Company’s formative stage of development and the Company’s financial position.Forward-looking statements contained herein are made as of the date of this news release and the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or results, except as may be required by applicable securities laws. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information.
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.
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