- Software Revenue Grows by 71% Year over Year -Toronto, ON – April 25, 2017 – 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, 2016. “With the sale of our POS Merchant Services business in January, this is the first time we are reporting our results as a pure cloud-based software company in the fintech space,” said Craig O’Neill, CEO of VersaPay. “We are pleased with the healthy level of growth in ARC™ revenues, up 71% year over year with 90 suppliers signed on to the platform and 73 live at the close of the quarter. We are also pleased to report the channel partnerships that we launched in Q4 have built good pipelines and we expect them to contribute to our revenue growth in 2017.” Mr. O’Neill continued, “As we indicated at the time of the sale transaction, while the divestiture of our POS Merchant Services business meant selling off much of our existing revenue base, the sale provided the capital to allow the Company to focus on its core software business, which has higher growth potential. Our Q4 results have been adjusted to show the effect of the sale, and the higher revenue growth rate and gross margin are indicators of the trajectory the software business is on to start the 2017 year. With increased focus and capital, and with our channel partners now operational, we expect this trajectory to increase in the coming quarters.” Financial Highlights: The following highlights treat the Company’s POS Merchant Services business as a discontinued operation.
- Revenue for Q4 2016 increased by 56.4% to $0.47 million compared to $0.30 million in Q4 2015.
- Revenue for the twelve months ended December 31, 2016 increased by 70.5% to $1.51 million compared to $0.89 million for the twelve months ended December 31, 2015.
- Gross margin percentage for Q4 2016 was 54.5%, compared to 46.6% in Q4 2015.
- Gross margin percentage for the twelve months ended December 31, 2016 was 54.3%, compared to 37.2% for the twelve months ended December 31, 2015.
- Adjusted EBITDA(1) was ($1.59) million in Q4 2016, compared to ($1.14) million in Q4 2015.
- Adjusted EBITDA was ($5.01) million for the twelve months ended December 31, 2016, compared to ($4.54) million for the twelve months ended December 31, 2015, in accordance with the Company’s plans to invest in its software business.
- Net earnings from discontinued operations was $0.15 million in Q4 2016, compared to $0.46 million in Q4 2015.
- Net earnings from discontinued operations was $1.43 million for the twelve months ended December 31, 2016, compared to $1.81 million for the twelve months ended December 31, 2015.
- Total comprehensive loss for Q4 2016 was ($1.82) million compared to a loss of ($1.23) million for Q4 2015.
- Total comprehensive loss for the twelve-months ended December 31, 2016 was ($5.93) million compared to a loss of ($5.34) million for the twelve months ended December 31, 2015, in keeping with the Company’s plans to invest in its software business.
- Cash operating expense for the twelve-months ended December 31, 2016 decreased by 3.7% to $6.00 million compared to $6.23 million for the twelve-months ended December 31, 2015.
- As at December 31, 2016, the Company had cash on hand of $2.75 million compared to $3.34 million as at December 31, 2015. This does not include cash proceeds of $10 million from the sale of the Company’s POS Merchant Services business which was completed in January 2017. (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, 2016 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 26, 2017 Time: 9:00 AM Eastern TimeParticipant Dial-in Numbers: Local – Toronto (+1) 416 764 8609 Toll Free – North America (+1) 888 390 0605 Conference ID: 13170349 Recording Playback Numbers: Toronto (+1) 416 764 8677 Toll Free – North America (+1) 888 390 0541 Passcode: 170349 # Expiry Date: Wednesday, May 3, 2017 11:59 PM A live audio webcast and archive of the conference call will be available by visiting the Company’s website at https://www.versapay.com/company/investor-relations/. 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.
About VersaPayVersaPay 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. More information about VersaPay can be found on the Company's website at www.versapay.com or under the Company's profile on SEDAR at www.sedar.com For additional information, please contact:
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