– Order Backlog Strengthening as Company Signs
Multiple Large Contracts
During and Post-Quarter –
TORONTO, May 9, 2016 /CNW/ - Redknee Solutions
Inc. (TSX: RKN) a leading provider of real-time
monetization and subscriber management software, reported results
for its fiscal second quarter ended March
31, 2016. (All figures are in U.S. dollars unless otherwise
stated.)
Fiscal Q2 2016 Financial Highlights
(Comparisons made between fiscal Q2FY2016 and fiscal Q2FY2015
results, unless otherwise noted)
- Revenue totalled $39.8 million ($40.6 million, on a constant currency basis),
compared to $53.7 million;
- Gross profit was $21.4 million (54% of total revenue)
compared to $32.7 million (61% of total revenue);
- Adjusted EBITDA loss of $2.4
million versus Adjusted EBITDA of $10.5 million (20% of total revenue);
- Recurring revenue was 63% of revenue, compared to 46%;
- Planned restructuring costs totalled $26-28 million will result in annual expense
savings of up to $25 million by
Fiscal 2017;
- Net loss was $35.6 million, or $0.33 loss
per share (including the $24.5
million, or $0.23 per share,
in restructuring costs) versus a net loss of $2.0
million or $0.02 loss per share;
- Adjusted cash from operations was $2.7
million;
- Available liquidity as at March 31,
2016 was $64.3 million,
including $44.3 million of cash,
and,
- Order backlog was $175.5
million.
Fiscal Q2 2016 Operational Highlights
- Won a contract valued at $15
million with a Tier 1 communications services provider (CSP)
in the Asia Pacific region to
deliver the latest version of Redknee Unified and to replace a
competitor's legacy postpaid billing system;
- Won a multi-year renewal of its software and services contract
with TIM Brazil under which Redknee will provide an end-to-end
solution that includes new software capabilities, managed services,
and support services;
- Launched the latest release of Redknee Unified, Redknee Unified
2016, at Mobile World Congress, the world's largest gathering for
the mobile industry;
- Released a report with Ovum to investigate the Digital
Transformation and the evolution of Communications Service
Providers into Digital Service Providers;
- Signed a multi-year license, support and consulting services
contract with Turk Telekom;
- Established a new partnership with Wipro to offer comprehensive
transformation services; and,
- Continued to expand the patent portfolio with a total of 153
patents granted and 27 patents filed at quarter end, with
additional patents still undergoing transfer following the
acquisition of Orga Systems.
Operational Highlights Subsequent to Fiscal Q2 2016
- Secured a three-year contract for software licenses and
services valued at more than $20
million with a leading Tier 1 communication service provider
in APAC to expand the Redknee Unified solution to deliver flexible
rating and charging services and support the customer's
transformation to a digital services model;
- Won an $8 million contract with a
leading Tier 1 CSP in the Americas to deploy the Redknee Unified
solution to deliver its multi-brand growth strategy across multiple
countries. Redknee's converged monetization and subscriber
management solution allows the CSP to leverage a virtualized and
cloud-based solution to support new brands in retail telecom and
M2M markets across the Americas;
- Named as one of the top Canadian ICT companies in the Branham
Group's annual listing; and,
- Successfully reached an agreement with the Workers' Council at
the Company's site in Berlin,
Germany, allowing the Company with respect to its planned
restructuring. As part of the agreement, Redknee will open a
Global Centre of Technical Excellence and a Global Operations
Leadership Centre, both of which will be based in Berlin.
Management Commentary
"We are seeing our business returning to a strong orders
momentum," said Lucas Skoczkowski, President and CEO, Redknee
Solutions Inc. "As per our expectation subsequent to the quarter
end, we have closed over $35 million
of orders, including our most recent three-year $20-plus million software and services expansion
contract, further strengthening our order backlog, while supporting
growth in revenues in the coming quarters."
"Although our first half fiscal 2016 results have been impacted
by the purchasing decision delays of communication service
providers, Redknee continues to provide one of the most
agile and competitive solutions on the market which
is essential to our customers' ability to execute their
transition from traditional to real time digital business
models. We have proven our ability to replace large
competitors in the market and successfully delivered Redknee's
managed services offering for a mission critical system with over
100 million subscribers. Our sales pipeline continues to be robust,
customer and partner discussions are active, and we are confident
that we will add more significant contract wins over the coming
quarters."
"In our operations, we continue to make progress on our
near-term priorities of expanding gross margin, growing recurring
revenue and driving cash flow generation alongside our ongoing
focus on optimizing our cost structure to maximize long-term
profitability. We have reached agreement on restructuring in
the key locations and we now expect annual costs savings of up to
$25 million on total restructuring
costs of up to $28 million."
Fiscal Q2 2016 Financial Results
Revenue was $39.8 million ($40.6
million on a constant currency basis) compared
to $53.7 million in the same year-ago quarter. The change
in revenue compared to the prior year period resulted mainly from
the impact of lower license revenue due to delays in customer
purchasing decisions and foreign exchange variation, compared to
the same year-ago quarter.
Order backlog increased 12% to $175.5
million ($174.5 million on a
constant currency basis) from $157.2
million in the same year-ago quarter, and sequentially order
backlog increased 5% from $166.8
million reported last quarter.
Recurring revenue was 63% of total revenue, compared to 46% in
the same year-ago quarter.
Gross margin was 21.4 million or 54% compared to $32.7 million or 61% in the same year-ago
quarter.
Adjusted EBITDA loss was $2.4 million, compared
to Adjusted EBITDA of $10.5
million, or 20% of revenue, in the same year-ago
quarter (see discussion about the presentation of Adjusted
EBITDA, a non-IFRS measure, below).
Net loss totalled $35.6 million, or $0.33
loss per basic and diluted share compared to a net loss
of $2.0 million, or $0.02
loss per basic and diluted share, in the same year-ago
quarter. Net loss included $24.5
million of restructuring costs, with the final restructuring
costs expected to be $26 to 28
million. The Company expects the restructuring will
reduce annual overall expenses by up to $25
million by Fiscal 2017, with partial savings occurring
through the last quarter of fiscal 2016.
At March 31, 2016, total cash
ended at $44.3 million. Adjusted cash
flow from operations was positive at $2.7
million (see discussion about the presentation of Adjusted
cash flow from operations, a non-IFRS measure, below).
During Q2 2016, the Company purchased 747,990 shares under its
Normal Course Issuer Bid (NCIB) for a total cost of approximately
CAD$2.0 million. Since the
NCIB's commencement on December 7,
2015, the Company has purchased an aggregate of 1,265,690
shares for a total cost of approximately CAD$3.5 million.
Please refer to the section regarding forward-looking statements
which form an integral part of this release. These results, along
with the annual audited consolidated financial statements and the
Company's MD&A, are available on the Company's website at
www.redknee.com and on SEDAR at www.sedar.com.
Conference Call
The company will host a conference call tomorrow (May 10, 2016) to discuss these results.
CEO Lucas Skoczkowski and CFO David
Charron will host the presentation starting at 8:30 a.m.
Eastern time. A question and answer session will follow
management's presentation.
Date: Tuesday May 10, 2016
Time: 8:30 a.m. Eastern time (5:30
a.m. Pacific time)
Dial-In Number: 1 (888) 231-8192
International: 1 (647) 427-7451
Conference ID#: 86923806
The presentation will be webcast live and available for replay
via either the Investors section of Redknee's website
(www.redknee.com) or https://goo.gl/Le28Fd.
Please call the conference telephone number 5-10 minutes prior
to the start time. An operator will register your name and
organization.
If you have any difficulty connecting with the conference call,
please contact NATIONAL | Equicom at 1 (416) 586-1955.
A replay of the call will be available until 12:00 midnight
(EST) Tuesday, May 17, 2016.
Toll-Free Replay Number: 1 (855) 859-2056
International Replay Number: 1 (416) 849-0833
Replay PIN: 86923806
About Redknee Solutions Inc.
Redknee monetizes today's digital world. We provide a complete
portfolio of mission-critical monetization and subscriber
management solutions and services that allow communications service
providers, utility companies, auto makers and enterprise businesses
of all types to charge for things in new and innovative ways.
Redknee's real-time billing, charging, policy and customer care
offerings provide the agility and scalability to drive a unique
user experience, increase profitability and support any new product
or business model. Available on premise, cloud-based, or as a
Software-as-a-Service, Redknee's low-risk, flexible solutions power
more than 250 businesses across the globe. Established in 1999,
Redknee Solutions Inc. (TSX: RKN) is the parent of the wholly-owned
operating subsidiary Redknee Inc. and its various subsidiaries.
References to Redknee refer to the combined operations of those
entities. For more information about Redknee and its solutions,
please go to www.redknee.com.
Non-IFRS Measures
The Company reports "Adjusted EBITDA", which is not a financial
measure calculated and presented in accordance with International
Financial Reporting Standards (IFRS), and should not be considered
in isolation or as a substitute to net income (loss), operating
income or any other financial measures of performance calculated
and presented in accordance with IFRS, or as an alternative to cash
flow from operating activities as a measure of liquidity. The
Company defines Adjusted EBITDA as net income (loss) excluding
amounts for depreciation and amortization, other income, finance
costs, finance income, income tax expense (recovery), foreign
exchange gain (loss), share-based compensation, restructuring costs
and acquisition and related costs. "Recurring revenue," is not a
financial measure calculated and presented in accordance with IFRS
and should not be considered in isolation or as a substitute to
revenue. Recurring revenue includes revenue from support and
maintenance agreements, long term service agreements, and
term-based product licenses and software subscription.
"Adjusted cash flow from operations", which is non-IFRS measure,
is defined as cash flow from operations excluding amounts for
restructuring payments made in the period.
"Order backlog" relates to contractual commitments as at period
end, pending to be delivered and will be recognized as revenue in
future periods. Order backlog is not a financial measure calculated
and presented in accordance with IFRS and should not be considered
in isolation or as a substitute to revenue.
The "constant currency" presentation, which is a non-IFRS
measure, excludes the impact of fluctuations in foreign currency
exchange rates. The Company calculates constant currency by
converting the current period local currency financial results
using the comparative period exchange rates.
Other companies (including competitors) may define Adjusted
EBITDA, Adjusted cash flow from operations, recurring revenue, and
order backlog differently. The company presents Adjusted EBITDA,
Adjusted cash flow from operations, recurring revenue, and order
backlog because management believes these to be important
supplemental measures of performance that are commonly used by
securities analysts, investors and other interested parties in the
evaluation of companies in Redknee's industry. Management uses this
information internally for forecasting and budgeting. It may not be
indicative of the historical operating results of Redknee nor is it
intended to be predictive of potential future results.
See "Reconciliation of Net Income (Loss) to Adjusted
EBITDA" below for further information on this
non-IFRS measure.
Forward-Looking Statements
Certain statements in this document may constitute
"forward-looking" statements which involve known and unknown risks,
uncertainties and other factors which may cause our actual results,
performance or achievements, or industry results, to be materially
different from any future results, performance or achievements
expressed or implied by such forward-looking statements. When used
in this document, such statements use such words as "may," "will,"
"expect," "continue," "believe," "plan," "intend," "would,"
"could," "should," "anticipate" and other similar terminology.
Forward-looking statements are provided for the purpose of
providing information about management's current expectations and
plans relating to the future. Persons reading this news release are
cautioned that such information may not be appropriate for other
purposes.
Such forward-looking statements include statements respecting
anticipated reduction in annual expenses in fiscal 2016 and 2017
and no direct impact on customer service or the Company's product
development, expansion of Adjusted EBITDA, future opportunities in
the company's core communication and non-telecom monetization
businesses, improvement in margin with an increase in revenue from
higher-margin software license deals as well as statements
regarding Redknee's future plans, objectives or performance for the
current period and subsequent periods and regarding the markets for
our products. These statements reflect current assumptions and
expectations regarding future events and operating performance and
speak only as of the date of this document. Forward-looking
statements involve significant risks and uncertainties, should not
be read as guarantees of future performance or results, and will
not necessarily be accurate indications of whether or not such
results will be achieved. A number of factors could cause actual
results to vary significantly from the results discussed in the
forward-looking statements, including, but not limited to, the
failure of demand for Redknee's products to develop as anticipated,
the failure to obtain customer orders or meet customer
requirements, the inability of Redknee's products to perform as
expected, the inability of Redknee to achieve anticipated cost
savings in the time frames and to the extent anticipated,
unanticipated negative impacts on customer service or product
development as a result of costs savings implemented, a material
adverse change in the affairs of Redknee, and the factors discussed
under the "Risk Factors" section of Redknee's most recently filed
AIF which is available on SEDAR at www.sedar.com and on
Redknee's web-site at www.redknee.com. Other unknown or
unpredictable factors or underlying assumptions subsequently
proving to be incorrect could cause actual results to differ
materially from those in the forward-looking statements. Redknee
does not undertake or accept any obligation or undertaking to
release publicly any updates or revisions to any forward-looking
statements to reflect any change in its expectations or any change
in events, conditions or circumstances on which any such statement
is based, except as required by law.
REDKNEE SOLUTIONS
INC.
|
Condensed
Consolidated Interim Statements of Financial Position
|
(Expressed in U.S.
dollars)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
September
30,
|
|
|
|
2016
|
|
2015
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
39,108,848
|
$
|
55,047,577
|
|
Trade accounts and
other receivables
|
|
|
61,264,075
|
|
67,439,885
|
|
Unbilled
revenue
|
|
|
34,858,603
|
|
38,427,866
|
|
Prepaid
expenses
|
|
|
3,439,656
|
|
2,535,936
|
|
Income taxes
receivable
|
|
|
2,357,155
|
|
1,399,564
|
|
Other
assets
|
|
|
401,131
|
|
392,195
|
|
Inventories
|
|
|
1,929,926
|
|
812,987
|
|
Total current
assets
|
|
|
143,359,394
|
|
166,056,010
|
|
|
|
|
|
|
Restricted
cash
|
|
|
5,194,065
|
|
5,972,087
|
Property and
equipment
|
|
|
7,591,286
|
|
8,435,008
|
Deferred income
taxes
|
|
|
1,574,869
|
|
2,086,025
|
Investment tax
credits
|
|
|
359,392
|
|
351,385
|
Other
assets
|
|
|
1,819,558
|
|
1,816,640
|
Intangible
assets
|
|
|
39,511,041
|
|
44,821,478
|
Goodwill
|
|
|
33,666,159
|
|
33,666,159
|
|
|
|
|
|
|
Total
assets
|
|
$
|
233,075,764
|
$
|
263,204,792
|
|
|
|
|
|
|
Liabilities and
Shareholders' Equity
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Trade
payables
|
|
$
|
10,792,094
|
$
|
9,128,710
|
|
Accrued
liabilities
|
|
|
23,740,141
|
|
32,305,136
|
|
Provisions
|
|
|
23,404,229
|
|
8,772,519
|
|
Income taxes
payable
|
|
|
3,224,851
|
|
2,364,983
|
|
Settlement accrual
and contingent consideration
|
|
|
2,531,829
|
|
10,244,224
|
|
Deferred
revenue
|
|
|
18,450,440
|
|
13,363,696
|
|
Loans and
borrowings
|
|
|
2,400,000
|
|
1,800,000
|
|
Total current
liabilities
|
|
|
84,543,584
|
|
77,979,268
|
|
|
|
|
|
|
Deferred
revenue
|
|
|
549,775
|
|
870,937
|
Other
liabilities
|
|
|
2,760,351
|
|
2,615,163
|
Pension and other
long-term employment benefit plans
|
|
|
12,872,382
|
|
11,417,481
|
Loans and
borrowings
|
|
|
53,658,078
|
|
54,961,066
|
Provisions
|
|
|
8,491,256
|
|
4,006,354
|
Total
liabilities
|
|
|
162,875,426
|
|
151,850,269
|
|
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
|
|
Share
capital
|
|
|
172,424,677
|
|
174,082,815
|
|
Treasury
stock
|
|
|
(141,917)
|
|
(141,917)
|
|
Contributed
surplus
|
|
|
8,410,148
|
|
7,899,360
|
|
Deficit
|
|
|
(107,015,855)
|
|
(67,086,722)
|
|
Accumulated other
comprehensive loss
|
|
|
(3,476,715)
|
|
(3,399,013)
|
|
Total shareholders'
equity
|
|
|
70,200,338
|
|
111,354,523
|
|
|
|
|
|
|
Total liabilities and
shareholders' equity
|
|
$
|
233,075,764
|
$
|
263,204,792
|
REDKNEE SOLUTIONS
INC.
|
Condensed
Consolidated Interim Statements of Comprehensive Loss
|
(Expressed in U.S.
dollars)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Six months
ended
|
|
|
|
March 31,
|
|
March 31,
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
|
|
|
|
|
|
|
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
Software, services
and other
|
|
$
|
17,105,453
|
$
|
31,220,323
|
$
|
42,223,687
|
$
|
69,175,923
|
|
Support and
subscription
|
|
|
22,687,039
|
|
22,522,584
|
|
47,684,616
|
|
47,143,913
|
|
|
|
39,792,492
|
|
53,742,907
|
|
89,908,303
|
|
116,319,836
|
|
|
|
|
|
|
|
|
|
|
Cost of
revenue
|
|
|
18,353,594
|
|
21,000,581
|
|
38,751,510
|
|
46,989,071
|
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
|
21,438,898
|
|
32,742,326
|
|
51,156,793
|
|
69,330,765
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
Sales and
marketing
|
|
|
7,816,722
|
|
7,700,464
|
|
16,217,996
|
|
17,162,703
|
|
General and
administrative
|
|
|
8,629,408
|
|
7,511,581
|
|
15,917,679
|
|
14,573,965
|
|
Research and
development
|
|
|
12,553,717
|
|
11,397,028
|
|
25,308,788
|
|
23,726,810
|
|
Restructuring
costs
|
|
|
24,541,909
|
|
251,635
|
|
24,820,455
|
|
588,349
|
|
Acquisition and
related costs
|
|
|
116,774
|
|
279,432
|
|
950,478
|
|
694,483
|
|
|
|
53,658,530
|
|
27,140,140
|
|
83,215,396
|
|
56,746,310
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from
operations
|
|
|
(32,219,632)
|
|
5,602,186
|
|
(32,058,603)
|
|
12,584,455
|
|
|
|
|
|
|
|
|
|
|
Foreign exchange gain
(loss)
|
|
|
28,232
|
|
(5,178,499)
|
|
(464,776)
|
|
(7,847,412)
|
Finance
income
|
|
|
17,730
|
|
7,192
|
|
23,104
|
|
11,674
|
Finance
costs
|
|
|
(1,759,403)
|
|
(1,116,244)
|
|
(2,807,934)
|
|
(2,014,461)
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before
income taxes
|
|
|
(33,933,073)
|
|
(685,365)
|
|
(35,308,209)
|
|
2,734,256
|
Income taxes
(recovery):
|
|
|
|
|
|
|
|
|
|
|
Current
|
|
|
1,618,062
|
|
1,370,784
|
|
3,999,351
|
|
2,770,579
|
|
Deferred
|
|
|
73,005
|
|
(16,454)
|
|
621,573
|
|
(7,589)
|
|
|
|
1,691,067
|
|
1,354,330
|
|
4,620,924
|
|
2,762,990
|
|
|
|
|
|
|
|
|
|
|
Loss for the
period
|
|
$
|
(35,624,140)
|
$
|
(2,039,695)
|
$
|
(39,929,133)
|
$
|
(28,734)
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive
loss:
|
|
|
|
|
|
|
|
|
|
|
Pension actuarial
adjustment
|
|
|
–
|
|
–
|
|
(77,702)
|
|
–
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive
loss
|
|
$
|
(35,624,140)
|
$
|
(2,039,695)
|
$
|
(40,006,835)
|
$
|
(28,734)
|
|
|
|
|
|
|
|
|
|
|
Loss per common
share:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
(0.33)
|
|
(0.02)
|
|
(0.37)
|
|
(0.00)
|
|
Diluted
|
|
|
(0.33)
|
|
(0.02)
|
|
(0.37)
|
|
(0.00)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of
|
|
|
|
|
|
|
|
|
|
common
shares:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
108,304,632
|
|
109,089,428
|
|
108,715,589
|
|
109,017,472
|
|
Diluted
|
|
|
108,304,632
|
|
109,089,428
|
|
108,715,589
|
|
109,017,472
|
REDKNEE SOLUTIONS
INC.
|
Condensed
Consolidated Interim Statements of Cash Flows
|
(Expressed in U.S.
dollars)
|
(Unaudited)
|
|
|
|
|
|
|
|
Three months
ended
|
|
Six months
ended
|
|
|
March 31,
|
|
March 31,
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
|
|
|
|
|
|
|
|
Cash provided by
(used in):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
activities:
|
|
|
|
|
|
|
|
|
|
Loss for the
period
|
$
|
(35,624,140)
|
$
|
(2,039,695)
|
$
|
(39,929,133)
|
$
|
(28,734)
|
|
Adjustments
for:
|
|
|
|
|
|
|
|
|
|
|
Depreciation of
property and equipment
|
|
1,185,400
|
|
1,135,416
|
|
2,188,427
|
|
2,077,652
|
|
|
Amortization of
intangible assets
|
|
2,447,730
|
|
1,527,207
|
|
4,735,596
|
|
3,339,589
|
|
|
Finance
income
|
|
(17,730)
|
|
(7,192)
|
|
(23,104)
|
|
(11,674)
|
|
|
Finance
costs
|
|
1,759,403
|
|
1,116,244
|
|
2,807,934
|
|
2,014,461
|
|
|
Pensions
|
|
1,180,647
|
|
(404,938)
|
|
1,377,199
|
|
(235,147)
|
|
|
Income tax
expense
|
|
1,691,067
|
|
1,354,330
|
|
4,620,924
|
|
2,762,990
|
|
|
Unrealized foreign
exchange loss (gain)
|
|
(26,456)
|
|
3,895,407
|
|
1,076,691
|
|
5,761,053
|
|
|
Share-based
compensation
|
|
1,507,036
|
|
1,733,015
|
|
1,756,645
|
|
2,198,181
|
|
|
Revaluation of
contingent consideration
|
|
–
|
|
(1,566,810)
|
|
–
|
|
(2,143,053)
|
|
|
Change in
provisions
|
|
21,948,779
|
|
(5,145,161)
|
|
19,116,612
|
|
(8,583,245)
|
|
|
Change in non-cash
operating working capital
|
|
5,548,409
|
|
10,143,262
|
|
4,828,780
|
|
1,047,258
|
|
|
1,600,145
|
|
11,741,085
|
|
2,556,571
|
|
8,199,331
|
|
|
Interest
paid
|
|
(113,449)
|
|
(39,082)
|
|
(434,217)
|
|
(88,836)
|
|
|
Interest
received
|
|
11,766
|
|
(37,830)
|
|
23,451
|
|
11,674
|
|
|
Income taxes
paid
|
|
(1,748,954)
|
|
(2,038,430)
|
|
(4,205,611)
|
|
(2,909,631)
|
|
|
(250,492)
|
|
9,625,743
|
|
(2,059,806)
|
|
5,212,538
|
Financing
activities:
|
|
|
|
|
|
|
|
|
|
|
Proceeds from
exercise of stock options
|
|
200,560
|
|
15,095
|
|
238,060
|
|
79,225
|
|
|
Purchase of treasury
stock
|
|
(1,450,484)
|
|
(536,507)
|
|
(2,556,966)
|
|
(536,507)
|
|
|
Interest paid on
loans and borrowings
|
|
(958,953)
|
|
–
|
|
(1,788,593)
|
|
(931,655)
|
|
|
Repayment of loans
and borrowings
|
|
(450,000)
|
|
(375,000)
|
|
(900,000)
|
|
(750,000)
|
|
|
Transaction costs of
loans and borrowings
|
|
–
|
|
–
|
|
(90,496)
|
|
–
|
|
|
(2,658,877)
|
|
(896,412)
|
|
(5,097,995)
|
|
(2,138,937)
|
|
|
|
|
|
|
|
|
|
Investing
activities:
|
|
|
|
|
|
|
|
|
|
|
Purchase of property
and equipment
|
|
(1,114,500)
|
|
(465,104)
|
|
(1,621,920)
|
|
(796,972)
|
|
|
Purchase of
intangible assets
|
|
(13,776)
|
|
(626,761)
|
|
(25,035)
|
|
(763,057)
|
|
|
Increase (decrease)
in restricted cash
|
|
616,114
|
|
–
|
|
778,022
|
|
(558,539)
|
|
|
Settlement accrual
and Contingent
|
|
|
|
|
|
|
|
|
|
|
|
consideration
paid
|
|
(1,072,596)
|
|
(412,321)
|
|
(7,712,395)
|
|
–
|
|
|
(1,584,758)
|
|
(1,504,186)
|
|
(8,581,328)
|
|
(2,118,568)
|
|
|
|
|
|
|
|
|
|
Effect of foreign
exchange rate changes on
|
|
|
|
|
|
|
|
|
|
cash and cash
equivalents
|
|
377,357
|
|
(3,374,480)
|
|
(199,600)
|
|
(5,240,126)
|
|
|
|
|
|
|
|
|
|
Increase (decrease)
in cash and cash
|
|
|
|
|
|
|
|
|
|
equivalents
|
|
(4,116,770)
|
|
3,850,665
|
|
(15,938,729)
|
|
(4,285,093)
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents,
|
|
|
|
|
|
|
|
|
|
beginning of
period
|
|
43,225,618
|
|
100,501,039
|
|
55,047,577
|
|
108,636,797
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents, end of period
|
$
|
39,108,848
|
$
|
104,351,704
|
|
39,108,848
|
$
|
104,351,704
|
REDKNEE SOLUTIONS
INC.
|
Reconciliation of Net
Income (Loss) to Adjusted EBITDA
|
(Expressed in U.S.
dollars)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Six months
ended
|
|
|
|
March 31,
|
|
March 31,
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
|
|
|
|
|
|
|
|
|
Net loss for the
period
|
|
|
(35,624,140)
|
|
(2,039,695)
|
|
(39,929,133)
|
|
(28,734)
|
|
|
|
|
|
|
|
|
|
|
Add back /
(subtract):
|
|
|
|
|
|
|
|
|
|
|
Depreciation of
property and
|
|
|
|
|
|
|
|
|
|
|
|
equipment
|
|
|
1,185,400
|
|
1,135,416
|
|
2,188,427
|
|
2,077,652
|
|
Amortization of
intangible assets
|
|
|
2,447,730
|
|
1,527,207
|
|
4,735,596
|
|
3,339,589
|
|
Finance
income
|
|
|
(17,730)
|
|
(7,192)
|
|
(23,104)
|
|
(11,674)
|
|
Finance
costs
|
|
|
1,759,403
|
|
1,116,244
|
|
2,807,934
|
|
2,014,461
|
|
Income tax
expense
|
|
|
1,691,067
|
|
1,354,330
|
|
4,620,924
|
|
2,762,990
|
|
Share-based
compensation
|
|
|
1,507,036
|
|
1,733,015
|
|
1,756,645
|
|
2,198,181
|
|
Foreign exchange loss
(gain)
|
|
|
(28,232)
|
|
5,178,499
|
|
464,776
|
|
7,847,412
|
|
Restructuring
costs
|
|
|
24,541,909
|
|
251,635
|
|
24,820,455
|
|
588,349
|
|
Acquisition and
related costs
|
|
|
116,774
|
|
279,432
|
|
950,478
|
|
694,483
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
$
|
(2,420,783)
|
$
|
10,528,891
|
|
2,392,998
|
$
|
21,482,709
|
SOURCE Redknee Solutions Inc.