via NewMediaWire --
NextPlay Technologies, Inc.
(NASDAQ: NXTP), a digital business ecosystem for
consumers, digital advertisers, video gamers and travelers,
reported results for the second quarter of fiscal 2022 ended August
31, 2021.
Financial Highlights
●
Revenue totaled a record $2.6 million compared to none in the same
year-ago quarter, which was attributed to acquisitions completed
approximately mid-quarter only contributing about 60% of their
revenue on aggregate. The contribution will rise to 100% in the
current fiscal third quarter.
● Gross
profit totaled $1.4 million, with consolidated gross margin at
51.9%.
● Assets
totaled $103.8 million
● Cash
and cash equivalents and restricted cash totaled $8.9 million.
Operational Highlights
●
Completed merger with in-game advertising technology
provider, HotPlay Enterprise, and changed the company name to
NextPlay Technologies.
●
Acquired majority interest in Zappware, an award-winning
connected TV service provider that delivers a personalized
entertainment experience across tens of millions of set-top boxes,
connected TVs, smartphones, tablets and PCs.
●
Acquired International Finance Enterprise Bank (IFEB).
Under the new name of NextBank International, the bank will
offer a full range of global fintech products and solutions, both
direct to consumers and businesses as well as through other
NextPlay divisions.
●
Reorganized the company’s operations and technologies under three
new divisions: Interactive Digital Media (NextMedia); Fintech
(NextFin) products and solutions; and Travel (NextTravel) for
travel technology and services.
●
Partnered with Mediakeys, an international media and
advertising agency, to accelerate the company’s global expansion of
NextPlay’s in-game advertising platform.
●
Strengthened NextPlay’s executive team with the appointments of
in-game tech industry leader and former CEO of
HotPlay, Nithinan (Jessie) Boonyawattanapisut, as co-CEO;
award-winning digital media executive, Andrew Greaves, as
chief operating officer; and industry leader in video game
development, Mark Vange, as chief technology officer.
Subsequent to the quarter, industry fintech leader, Jorge E.
Miró Hernández, was appointed president and chief operating officer
of NextBank International.
●
Entered definitive agreement to acquire two complementary
technology companies: Token IQ, a leading innovator in digital
asset management that provides cryptocurrency owners a solution to
replace lost or inaccessible assets; and Make It Games™, the
AI-powered video game development platform of Fighter Base
Publishing.
Management Commentary
“Our second quarter of fiscal 2022 was a major
inflection point for NextPlay, as we transformed our business
through several highly-synergistic acquisitions, and laid the
foundation for future growth and expansion,” commented NextPlay
co-CEO, Bill Kerby. “This resulted in record revenues of $2.6
million, which we expect to more than double in the current quarter
as all of these acquisitions contribute fully. We also anticipate
gross margin expansion above the record 51.9% in Q2 as we develop
synergies between our divisions.
“This M&A activity included establishing a new
Interactive Digital Media division with the acquisitions of the
HotPlay in-game advertising platform at the beginning of the
quarter and then Zappware’s Connected TV platform about
mid-quarter.
“Zappware’s award-wining entertainment media
platform reaches tens of millions of devices across Europe, with
this expanding into Latin America, Asia and other parts of the
world. HotPlay plugs directly into casual games on set-top boxes,
connected TVs, smartphones, tablets and PCs. It seamlessly
integrates digital ads into video games without disrupting
gameplay, which empowers video game publishers to monetize their IP
without compromising game integrity.
“We are working on the integration of Zappware
with HotPlay, which would enable digital advertisers and brands
using HotPlay to reach a vast global Pay TV consumer base like
never before. We expect the addition of Make It Games to further
enhance the HotPlay platform with AI-powered video game development
technology and thereby provide a further competitive edge.
“We also acquired mid-quarter IFEB bank, which we
now call NextBank International, that allows us to offer asset
banking and management, mobile payments and insurance, as well as
provide consumers and businesses with access to cryptocurrency
exchanges and digital wallets. NextBank International will
additionally support and enhance our other divisions with
integrated fintech services and capabilities.”
NextPlay’s Fintech division is also working on
several initial coin offerings through the Longroot ICO portal.
This includes the previously announced Magnolia “Forestias” real
estate coin offering and a tokenized fund for medical facility
related investments, such as facilities serving medical
tourism.
These ICOs are advancing towards IPO underwritings
by Longroot, NextPlay’s majority owned Longroot Limited, which
controls Thai SEC-authorized Initial Coin Offering portal Longroot
(Thailand) Company Limited. Longroot is authorized and regulated
under global-leading Thai Digital Asset Business Law and licensed
by the Thai Securities & Exchange Commission.
Concurrently, NextPlay’s Fintech division is
building relationships with Crypto Trading Exchanges and selling
groups it believes are necessary for successful initial coin
offerings. To that end, NextPlay’s Fintech team has been in
advanced discussions with several well-established digital asset
listing and trading exchanges in Asia and North America to be in
step and in-place with the proposed ICOs.
“We see the addition of Token IQ technology
becoming core to all our products and services, from our Longroot
asset-based cryptocurrencies and HotPlay in-game tokens, to future
NextBank fintech services and NextTrip medical tourism offerings,”
continued Kerby. “Token IQ also brings valuable technology and
software development talent to support the technology integration
between our platforms and our partners, as well as further our IP
development.
“Altogether, we believe the integration of these
acquisitions will enable us to seamlessly engage consumers across
the physical and digital worlds like no other company in the market
today. They have been key to our vision of building a dynamic
digital ecosystem that reaches consumers, gamers and travelers
worldwide for the benefit of digital advertisers and
brands.
“As we begin the second half of fiscal 2022, we
are now exceptionally well positioned for growth across our three
divisions of interactive digital media, fintech and travel. In
addition to the planned Zappware/HotPlay integration, we see
near-term revenue growth and margin expansion through anticipated
HotPlay deployments and Longroot cryptocurrency offerings, and with
this accelerating us toward strong cashflow and
profitability.”
NextPlay’s co-CEO Nithinan ‘Jessie’
Boonyawattanapisut added, “Each of our new divisions are led by
highly accomplished and capable management who are experts in their
fields, and who have assembled equally capable teams. They are
leading growth plans for each of these divisions, which includes
many opportunities for cross-leveraging and cross-pollinating their
respective technologies, customer bases, and market channels to
generate robust returns and increasing shareholder value over the
long term.”
Q2 Fiscal 2022 Financial
Summary
Due to the reverse merger with HotPlay, the
year-ago results for the second quarter of fiscal 2021 and at
February 28, 2021 incorporate only HotPlay’s financials.
Revenue for the second quarter of fiscal 2022
totaled $2.6 million, as compared to no revenue in the same
year-ago quarter. The improvement was primarily the result of the
acquisitions of HotPlay, Zappware (via acquisition of Reinhart TV),
and IFEB Bank (now NextBank International).
The Digital Interactive Media revenue was
primarily due to the contribution of Zappware product deployments,
services and service license agreements. The fintech revenue was
attributed to interest income and loan fees, as generated by
NextBank. The increase in travel revenue was due to travel
reservations booked by the
company’s NextTrip units.
Consolidated gross profit totaled $1.4 million or
51.9% of revenue, as compared to none in the year-ago
period.
Total operating expenses totaled $6.2 million,
compared to $422,000 in the same year-ago period. The majority
increase was primarily due to one-time acquisition-related
expenses, and the consolidation of expenses from business
combinations of HotPlay, Reinhart/Zappware, and IFEB.
Net loss was $9.7 million or $(0.11) per basic and
fully diluted share, as compared to a net loss of $411,000 or
$(5.06) per basic and fully diluted share in same year-ago
period.
Cash and cash equivalents at August 31, 2021
totaled $8.9 million, compared to $445,000 at February 28,
2021.
The Company’s Q2, 2022 Financial Report, and other
reports the Company files with the SEC, including reports on Forms
10-Q, 10-K and 8-K, can be accessed at sec.gov and on
NextPlay’s website in the IR section.
About NextPlay Technologies
NextPlay Technologies, Inc. (Nasdaq: NXTP) is a
technology solutions company offering games, in-game advertising,
crypto-banking, connected TV and travel booking services to
consumers and corporations within a growing worldwide digital
ecosystem. NextPlay’s engaging products and services utilize
innovative AdTech, Artificial Intelligence and Fintech solutions to
leverage the strengths and channels of its existing and acquired
technologies. To learn more about NextPlay,
visit NextPlayTechnologies.com, and follow us
on Twitter @NextPlayTech and LinkedIn.
Important Cautions Regarding
Forward-Looking Statements and Disclaimers
This press release includes “forward-looking
statements” within the meaning of, and within the safe harbor
provided by the Safe Harbor Provisions of the Private Securities
Litigation Reform Act of 1995, Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended. Forward-looking statements give our current
expectations, opinions, belief or forecasts of future events and
performance. A statement identified by the use of forward-looking
words including “will,” “may,” “expects,” “projects,”
“anticipates,” “plans,” “believes,” “estimate,” “should,” and
certain of the other foregoing statements may be deemed
forward-looking statements. Although the Company believes that the
expectations reflected in such forward-looking statements are
reasonable, these statements involve risks and uncertainties that
may cause actual future activities and results to be materially
different from those suggested or described in this news
release.
Factors that may cause such a difference include
risks and uncertainties related to our need for additional capital
which may not be available on commercially acceptable terms, if at
all, which raises questions about our ability to continue as a
going concern; the fact that the COVID-19 pandemic has had, and is
expected to continue to have, a significant material adverse impact
on the travel industry and our business, operating results and
liquidity; amounts owed to us by third parties which may not be
paid timely, if at all; certain amounts we owe under outstanding
indebtedness which are secured by substantially all of our assets
and penalties we may incur in connection therewith; the fact that
we have significant indebtedness, which could adversely affect our
business and financial condition; uncertainty and illiquidity in
credit and capital markets which may impair our ability to obtain
credit and financing on acceptable terms and may adversely affect
the financial strength of our business partners; the officers and
directors of the Company have the ability to exercise significant
influence over the Company; stockholders may be diluted
significantly through our efforts to obtain financing, satisfy
obligations and complete acquisitions through the issuance of
additional shares of our common or preferred stock; if we are
unable to adapt to changes in technology, our business could be
harmed; if we do not adequately protect our intellectual property,
our ability to compete could be impaired; our long-term travel
business success depends, in part, on our ability to expand our
property owner, manager and traveler bases outside of the United
States and, as a result, our travel business is susceptible to
risks associated with international operations; unfavorable changes
in, or interpretations of, government regulations or taxation of
the evolving ALR, Internet and e-commerce industries which could
harm our operating results; risks associated with the operations
of, the business of, and the regulation of, Longroot and NextBank
(formerly IFEB ); the market in which we participate being highly
competitive, and because of that we may be unable to compete
successfully with our current or future competitors; our potential
inability to adapt to changes in technology, which could harm our
business; the volatility of our stock price; risks associated with
the integration of the operations of HotPlay Enterprise Limited,
which acquisition we recently competed; the fact that we may be
subject to liability for the activities of our property owners and
managers, which could harm our reputation and increase our
operating costs; and that we have incurred significant losses to
date and require additional capital which may not be available on
commercially acceptable terms, if at all. More information about
the risks and uncertainties faced by the Company are detailed from
time to time in the Company’s periodic reports filed with the SEC,
including its most recent Annual Report on Form 10-K and Quarterly
Reports on Form 10-Q, under the headings “Risk Factors”. These
reports are available at www.sec.gov. Other unknown or
unpredictable factors also could have material adverse effects on
the Company’s future results and/or could cause our actual results
and financial condition to differ materially from those indicated
in the forward-looking statements. Investors are cautioned that any
forward-looking statements are not guarantees of future performance
and actual results or developments may differ materially from those
projected. The forward-looking statements in this press release are
made only as of the date hereof. The Company takes no obligation to
update or correct its own forward-looking statements, except as
required by law, or those prepared by third parties that are not
paid for by the Company. If we update one or more forward-looking
statements, no inference should be drawn that we will make
additional updates with respect to those or other forward-looking
statements.
None of the tokens contemplated in this release
(collectively, the “Securities) have been registered under the U.S.
Securities Act of 1933, as amended (the “Securities Act”), in
reliance upon the exemption provided by Regulation S thereunder.
The Securities referenced herein are not for distribution, directly
or indirectly, in or into the United States or to any U.S. person
as defined in Regulation S. This announcement is not an offer of
Securities for sale into the United States. The Securities have not
been registered under the Securities Act and may not be offered or
sold in the United States or to, or for the account or benefit of,
U.S. persons (as such term is defined in Regulation S) unless they
are registered under the Securities Act or they are exempt from
registration under the Securities Act. Hedging transactions
involving these Securities may not be conducted unless in
compliance with the Securities Act.
Source: NextPlay Technologies, Inc.
Company Contact:
NextPlay Technologies, Inc
Richard Marshall
Director of Corporate Development
Tel (954) 888-9779
richard.marshall@nextplaytechnologies.com
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