Points International Ltd. (TSX: PTS) (Nasdaq: PCOM) (Points or the
Company), the global leader in powering loyalty commerce, is
reporting financial results for the fourth quarter and full year
ended December 31, 2019.
Unless otherwise noted, all comparisons are on a year-over-year
basis and all amounts are in USD. The complete 2019 Audited
Consolidated Financial Statements and fourth quarter and full year
Management Discussion & Analysis, including segmented results,
are available at www.sedar.com and www.sec.gov.
Fourth Quarter 2019 Financial Highlights (vs. Q4
2018)
- Total revenue increased 13% to $107.0 million compared to $94.9
million.
- Gross profit1 increased 25% to $17.6 million compared to $14.1
million.
- Net income increased 23% to $2.8 million or $0.20 per diluted
share, compared to $2.2 million or $0.16 per diluted share.
- Adjusted EBITDA2 increased 43% to $7.2 million compared to $5.0
million.
Full Year 2019 Financial Highlights (vs.
2018)
- Total revenue increased 7% to $401.2 million compared to $376.2
million.
- Gross profit increased 21% to an annual record $65.5 million
compared to $53.9 million. Excluding the benefit of an approximate
$6.0 million tax rebate that was confirmed in the second quarter
for claims related to prior periods, gross profit was up 10% to
$59.4 million, which was still an annual record.
- Net income increased 53% to $11.9 million or $0.86 per diluted
share, compared to $7.8 million or $0.54 per diluted share.
- Adjusted EBITDA increased 15% to an annual record $21.5 million
compared to $18.6 million.
Management Commentary
“2019 was a record year for Points, highlighted by an
exceptional fourth quarter where we generated more than 40% growth
in adjusted EBITDA to $7.2 million, our highest quarterly mark in
company history,” said Points CEO Rob MacLean. “The fourth quarter
benefitted from the investments made over the last year to enhance
our data-led marketing capabilities, which continued to drive
improved performance of in-market engagements. In fact, we
continued to see strong gross profit growth with our top partners
in 2019, as we deepen our relationships throughout the
industry.
“In addition to delivering on our growth expectations in 2019,
we executed on our plans for international expansion, industry
diversification, and corporate development. In 2019, we opened new
offices in Singapore and Dubai, and generated gross profit growth
in Europe, the Middle East, and the Asia Pacific, as these regions
continue to become a larger portion of our overall economics for
the third year in a row. In addition, we launched programs in newer
verticals with companies like Lyft and HSBC/Airmiles Middle East,
Home Chef, and made progress in growing our strategic partnership
with Amadeus.
“Looking ahead, we remain on track for our long-term growth
expectations of generating gross profit in the high-$90 million
range and adjusted EBITDA in the mid-$40 million range as we exit
2022. Our ability to deliver on these financial goals is backed by
our growth strategy and consistent execution over the last several
years, as we have increased adjusted EBITDA by more than 80% since
2016. Our team is extremely proud of what we accomplished last
year, but we are even more excited about what's in store for the
years ahead.”
Fourth Quarter 2019 Financial Results
Total revenue in the fourth quarter of 2019 increased 13% to
$107.0 million compared to $94.9 million in the prior year quarter.
Principal revenue increased 11% to $98.2 million compared to $88.3
million, and other partner revenue increased 35% to $8.9 million
compared to $6.6 million.
Gross profit in the fourth quarter increased 25% to a quarterly
record of $17.6 million compared to $14.1 million in the prior year
quarter. The increase was primarily driven by record performances
in the Loyalty Currency Retailing and Points Travel segments.
Adjusted operating expenses3 in the fourth quarter of 2019 were
$10.6 million compared to $9.3 million in the prior year quarter.
The increase was primarily a result of higher personnel-related
costs associated with the resources added in 2019 to support the
Company’s growth initiatives.
Net income increased 23% to $2.8 million or $0.20 per diluted
share, compared to $2.2 million or $0.16 per diluted share in the
prior year quarter.
Adjusted EBITDA in the fourth quarter increased 43% to a
quarterly record of $7.2 million compared to $5.0 million in the
prior year quarter. Effective margin, which is defined as adjusted
EBITDA as a percentage of gross profit, increased to 40.9% compared
to 35.7% from the prior year period.
At December 31, 2019, total funds available, comprised of cash
and cash equivalents, funds receivable from payment processors, and
cash held in trust and restricted cash, increased 4% to $86.8
million compared to $83.1 million at December 31, 2018. The Company
remains debt free.
During the fourth quarter, Points repurchased for cancellation
approximately 200,000 common shares at an average price of $11.90
per share through its Automatic Share Purchase Plan in conjunction
with its Normal Course Issuer Bid.
Full Year 2019 Financial Results
Total revenue in 2019 increased 7% to $401.2 million compared to
$376.2 million in the prior year. Principal revenue increased 6% to
$374.5 million compared to $351.7 million, and other partner
revenue increased 9% to $26.7 million compared to $24.5
million.
Gross profit in 2019 increased 21% to an annual record of $65.5
million compared to $53.9 million in the prior year. Excluding the
benefit of a $6.0 million tax rebate that was confirmed in the
second quarter for claims related to prior periods, gross profit
was still a record $59.4 million, an increase of 10% over the prior
year.
Total adjusted operating expenses in 2019 were $38.9 million
compared to $36.0 million in 2018.
Net income increased 53% to $11.9 million or $0.86 per diluted
share, compared to $7.8 million or $0.54 per diluted share in
2018.
Adjusted EBITDA in 2019 increased 15% to an annual record $21.5
million compared to $18.6 million in the prior year. Effective
margin improved 160 basis points to 36.1% compared to 34.5% from
the prior year.
2020 Outlook
Points expects 2020 gross profit to range between $67.0 million
and $73.0 million, reflecting approximately 13% to 23% growth from
20194. The Company also expects adjusted EBITDA to range between
$23.0 million and $27.0 million, reflecting approximately 7% to 26%
growth from 2019. At this time, the Company has not seen any
material impact to the performance of its existing business
resulting from the recent COVID-19 virus outbreak. Accordingly, the
Company has not included any impact from the outbreak into its 2020
outlook, and will update investors as appropriate when the longer
term impact becomes more clear.
1 Gross profit is defined as total revenue less the direct cost
of revenue. Gross profit is considered by management to be an
integral measure of financial performance and represents the amount
of revenues retained by the Company after incurring direct
costs. However, gross profit is not a recognized measure of
profitability under IFRS.
2 Adjusted EBITDA (Earnings before income tax expense,
depreciation and amortization, foreign exchange, finance costs and
equity-settled share-based compensation and other one-time costs or
benefits such as a tax rebate related to prior periods) is
considered by management to be a useful supplemental measure when
assessing financial performance. Management also believes
that adjusted EBITDA is an important indicator of the Company’s
ability to generate liquidity through operating cash flow to fund
future capital expenditures and working capital needs.
However, adjusted EBITDA is not a measure of financial performance
under IFRS and should not be considered a substitute for Net
Income, which we believe to be the most directly comparable IFRS
measure.
3 Adjusted operating expenses consist of employment expenses
excluding equity-settled share-based compensation, marketing and
communications, technology services and other operating
expenses. Adjusted operating expense is not a measure of
financial performance under IFRS and should not be considered a
substitute for total operating expenses, which we believe to be the
most directly comparable IFRS measure.
4 Growth rates for gross profit based on full year gross profit
in 2019 of $59.4 million, which excludes the benefit of a $6.0
million tax rebate that was confirmed in the second quarter of 2019
for claims related to prior periods
Conference Call
Points will hold a conference call today at 4:30 p.m. Eastern
time to discuss its fourth quarter and full year 2019 results,
followed by a question-and-answer session.
Date: Wednesday, March 4, 2020Time: 4:30 p.m. Eastern time (1:30
p.m. Pacific time)Toll-free dial-in number:
1-877-407-0784International dial-in number:
1-201-689-8560Conference ID: 13698845
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 Gateway Investor Relations at
1-949-574-3860.
A replay of the conference call will be available after 7:30
p.m. Eastern time on the same day through March 18, 2020.
Toll-free replay number: 1-844-512-2921International replay
number: 1-412-317-6671Replay ID: 13698845
About Points International Ltd.
Points, (TSX: PTS) (NASDAQ: PCOM), provides loyalty e-commerce
and technology solutions to the world's top brands to power
innovative services that drive increased loyalty program revenue
and member engagement. Currently, the Company has a growing network
of nearly 60 global loyalty programs integrated into its unique
Loyalty Commerce Platform. Points offers three core private or
co-branded services: its Loyalty Currency Retailing service sells
loyalty points and miles directly to consumers; its Platform
Partners service, which offers earn and redemption opportunities
via third-party or loyalty channels; and its Points Travel service
helps loyalty programs increase revenue from hotel and car rental
bookings while offering members more opportunities to earn and
redeem loyalty rewards more broadly. Points is headquartered in
Toronto, with offices in San Francisco, London, Singapore, and
Dubai.
For more information, visit company.points.com.
Caution Regarding Forward-Looking
Statements
This press release contains or incorporates forward-looking
statements within the meaning of United States securities
legislation, and forward-looking information within the meaning of
Canadian securities legislation (collectively, "forward-looking
statements"). These forward-looking statements include, among other
things, our ability to deliver on our long-term goals for 2022, our
core growth strategies, and our guidance for 2020 with respect to
gross profit and adjusted EBITDA. These statements are not
historical facts but instead represent only Points' expectations,
estimates and projections regarding future events.
Although Points believes the expectations reflected in such
forward-looking statements are reasonable, such statements are not
guarantees of future performance and are subject to important risks
and uncertainties that are difficult to predict. Certain material
assumptions or estimates are applied in making forward-looking
statements, and actual results may differ materially from those
expressed or implied in such statements. Undue reliance should not
be placed on such statements. In particular, the financial outlooks
herein assume Points will be able to maintain its existing
contractual relationships and products, that such products continue
to perform in a manner consistent with Points' past experience,
that Points will be able to generate new business from our pipeline
at expected margins, our in-market and newly launched products and
services will perform in a manner consistent with the Company's
past experience and we will be able to contain costs. Our ability
to convert our pipeline of prospective partners and products and
cross-sell existing partners is subject to significant risk and
there can be no assurance that we will launch new partners or new
products with existing partners as expected or planned nor can
there be any assurance that Points will be successful in
maintaining its existing contractual relationships or maintaining
existing products with existing partners. Other important risk
factors that could cause actual results to differ materially
include the risk factors discussed in Points' annual information
form, Form 40-F, annual and interim management's discussion and
analysis, and annual and interim financial statements and the notes
thereto. These documents are available at www.sedar.com and
www.sec.gov.
The forward-looking statements contained in this press release
are made as at the date of this release and, accordingly, are
subject to change after such date. Except as required by law,
Points does not undertake any obligation to update or revise any
forward-looking statements made or incorporated in this press
release, whether as a result of new information, future events or
otherwise.
Non-GAAP Financial Measures
The Company’s financial statements are prepared in accordance
with International Financial Reporting Standards ("IFRS").
Management uses certain non-GAAP measures, which are defined in the
appropriate sections of this press release, to better assess the
Company’s underlying performance. These measures are reviewed
regularly by management and the Company's Board of Directors in
assessing the Company’s performance and in making decisions about
ongoing operations. In addition, we use certain non-GAAP measures
to determine the components of management compensation. We believe
that these measures are also used by investors as an indicator of
the Company’s operating performance. Readers are cautioned that
these terms are not recognized GAAP measures and do not have a
standardized GAAP meaning under IFRS and should not be construed as
alternatives to IFRS terms, such as net income.
Investor Relations Contact
Sean Mansouri, CFA or Cody SlachGateway Investor Relations
1-949-574-3860IR@points.com
Points International Ltd. |
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Key Financial
Measures and Schedule of Non-GAAP Reconciliations |
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Gross Profit Information[1] |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expressed in thousands of United States dollars |
|
|
|
|
|
|
|
|
|
|
For the three months
ended |
|
For the year
ended |
|
|
|
|
|
|
Dec 31,
2019 |
Dec 31, 2018 |
|
Dec 31,
2019 |
Dec 31, 2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Revenue |
|
$ |
107,007 |
|
$ |
94,918 |
|
|
$ |
401,177 |
|
$ |
376,245 |
|
|
|
|
Direct cost of revenue |
|
|
89,418 |
|
|
80,813 |
|
|
|
335,722 |
|
|
322,341 |
|
|
|
|
Gross Profit |
|
$ |
17,589 |
|
$ |
14,105 |
|
|
$ |
65,455 |
|
$ |
53,904 |
|
|
|
|
Gross Margin |
|
|
16 |
% |
|
15 |
% |
|
|
16 |
% |
|
14 |
% |
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[1] Gross profit is
defined as total revenue less direct cost of revenue. Gross profit
is considered by Management to be an integral measure of financial
performance and represents the amount of revenues retained by the
Company after incurring direct costs. However, gross profit is not
a recognized measure of profitability under IFRS. |
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Reconciliation of Gross Profit to Contribution
[2] |
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|
|
|
|
|
Expressed in thousands of United States dollars |
|
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|
|
|
|
|
|
For the three months
ended |
|
For the year
ended |
|
|
|
|
Dec 31,
2019 |
Dec 31, 2018 |
|
Dec 31,
2019 |
Dec 31, 2018 |
|
|
|
|
|
|
|
|
|
|
Gross Profit |
|
$ |
17,589 |
$ |
14,105 |
|
$ |
65,455 |
$ |
53,904 |
|
Less: |
|
|
|
|
|
|
|
|
Direct adjusted operating expenses [3] |
|
6,503 |
|
5,702 |
|
|
24,539 |
|
22,247 |
|
Contribution |
|
$ |
11,086 |
$ |
8,403 |
|
$ |
40,916 |
$ |
31,657 |
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|
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|
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|
|
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|
[2] Contribution is
defined as gross profit less direct adjusted operating expenses.
Contribution is considered by Management to be a useful
supplemental measure when assessing financial performance.
Management believes that Contribution is an important indicator of
the Company’s segment profitability. However, Contribution is not a
recognized measure of profitability under IFRS. |
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|
[3] Direct adjusted
operating expenses is defined as expenses which are directly
attributable to each operating segment. Direct adjusted operating
expenses is not a measure of financial performance under IFRS. |
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Contribution by Line of Business |
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|
Expressed in thousands of United States dollars |
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|
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|
|
For the three months
ended |
|
For the year
ended |
|
|
|
Dec 31,
2019 |
Dec 31, 2018 |
|
Dec 31,
2019 |
Dec 31, 2018 |
|
|
|
|
|
|
|
|
Loyalty Currency Retailing |
|
|
|
|
|
Total revenue |
|
$ |
103,966 |
|
$ |
92,358 |
|
|
$ |
391,045 |
|
$ |
366,421 |
|
Gross profit |
|
|
14,746 |
|
|
11,761 |
|
|
|
56,013 |
|
|
44,806 |
|
Direct adjusted operating expenses |
|
3,714 |
|
|
3,273 |
|
|
|
13,830 |
|
|
12,941 |
|
Contribution |
|
$ |
11,032 |
|
$ |
8,488 |
|
|
$ |
42,183 |
|
$ |
31,865 |
|
|
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|
|
|
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|
Platform Partners |
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|
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Total revenue |
|
$ |
2,003 |
|
$ |
2,096 |
|
|
$ |
7,577 |
|
$ |
7,979 |
|
Gross profit |
|
|
1,826 |
|
|
1,918 |
|
|
|
6,912 |
|
|
7,364 |
|
Direct adjusted operating expenses |
|
979 |
|
|
956 |
|
|
|
3,871 |
|
|
3,784 |
|
Contribution |
|
$ |
847 |
|
$ |
962 |
|
|
$ |
3,041 |
|
$ |
3,580 |
|
|
|
|
|
|
|
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|
Points Travel |
|
|
|
|
|
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Total revenue |
|
$ |
1,038 |
|
$ |
464 |
|
|
$ |
2,555 |
|
$ |
1,845 |
|
Gross profit |
|
|
1,017 |
|
|
426 |
|
|
|
2,530 |
|
|
1,734 |
|
Direct adjusted operating expenses |
|
1,810 |
|
|
1,473 |
|
|
|
6,838 |
|
|
5,522 |
|
Contribution |
|
$ |
(793 |
) |
$ |
(1,047 |
) |
|
$ |
(4,308 |
) |
$ |
(3,788 |
) |
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Reconciliation of Net Income to Adjusted EBITDA
[4] |
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Expressed in thousands of United States dollars |
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For the three months
ended |
|
For the year
ended |
|
|
|
|
|
|
Dec 31,
2019 |
Dec 31, 2018 |
|
Dec 31,
2019 |
Dec 31, 2018 |
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Net Income |
|
$ |
2,758 |
|
$ |
2,246 |
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|
$ |
11,889 |
|
$ |
7,792 |
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|
|
|
Income tax expense |
|
|
1,475 |
|
|
865 |
|
|
|
5,155 |
|
|
3,104 |
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|
Finance costs |
|
|
48 |
|
|
- |
|
|
|
211 |
|
|
- |
|
|
|
|
Depreciation and amortization |
|
1,269 |
|
|
740 |
|
|
|
4,668 |
|
|
3,364 |
|
|
|
|
Foreign exchange (gain) loss |
|
(7 |
) |
|
(3 |
) |
|
|
401 |
|
|
(36 |
) |
|
|
|
Equity-settled share-based payment expense |
|
|
|
1,650 |
|
|
1,184 |
|
|
|
5,172 |
|
|
4,381 |
|
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|
Tax rebate
related to prior years, net of fees |
|
|
|
- |
|
|
- |
|
|
|
(6,027 |
) |
|
- |
|
|
|
|
Adjusted EBITDA |
|
$ |
7,193 |
|
$ |
5,032 |
|
|
$ |
21,469 |
|
$ |
18,605 |
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[4] Adjusted EBITDA
(Earnings before income tax expense, finance costs, depreciation
and amortization, foreign exchange, equity-settled share-based
payment expense and other one-time costs or benefits such as a tax
rebate related to prior periods) is considered by Management to be
a useful supplemental measure when assessing financial performance.
Management believes that adjusted EBITDA is an important indicator
of the Company’s ability to generate liquidity through operating
cash flow to fund future capital expenditures and working capital
needs. However, adjusted EBITDA is not a measure of financial
performance under IFRS and should not be considered a substitute
for Net Income, which we believe to be the most directly comparable
IFRS measure. |
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Reconciliation
of Total Operating Expenses to Adjusted Operating Expenses
[5] |
|
|
|
|
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|
|
|
|
Expressed in thousands of United States dollars |
|
|
|
|
|
|
|
|
For the three months
ended |
|
For the year
ended |
|
|
|
|
Dec 31,
2019 |
Dec 31, 2018 |
|
Dec 31,
2019 |
Dec 31, 2018 |
|
|
|
|
|
|
|
|
|
|
Total Operating Expenses |
$ |
13,489 |
|
$ |
11,214 |
|
|
$ |
49,108 |
$ |
43,674 |
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|
Subtract (add): |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
1,269 |
|
|
740 |
|
|
|
4,668 |
|
3,364 |
|
|
|
Foreign exchange (gain) loss |
|
(7 |
) |
|
(3 |
) |
|
|
401 |
|
(36 |
) |
|
|
Equity-settled share-based payment expense |
|
|
1,650 |
|
|
1,184 |
|
|
|
5,172 |
|
4,381 |
|
|
Adjusted Operating Expenses |
$ |
10,577 |
|
$ |
9,293 |
|
|
$ |
38,867 |
$ |
35,965 |
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|
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[5] Adjusted operating
expenses consists of employment expenses excluding equity-settled
share-based payment expense, marketing & communications,
technology services, and other operating expenses. Adjusted
operating expenses is not a measure of financial performance under
IFRS and should not be considered a substitute for total operating
expenses, which we believe to be the most directly comparable IFRS
measure. |
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|
Points International Ltd. |
|
|
|
Consolidated Statements of Financial Position |
|
|
|
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|
|
Expressed in thousands of United States dollars |
|
|
|
As at December 31 |
|
2019 |
|
2018[6] |
|
|
|
|
|
|
ASSETS |
|
|
|
Current assets |
|
|
|
|
Cash and
cash equivalents |
$ |
69,965 |
|
$ |
69,131 |
|
|
|
Cash held in
trust and restricted cash |
|
2,534 |
|
|
500 |
|
|
|
Funds
receivable from payment processors |
|
14,302 |
|
|
13,512 |
|
|
|
Accounts
receivable |
|
21,864 |
|
|
9,318 |
|
|
|
Prepaid
taxes |
|
194 |
|
|
383 |
|
|
|
Prepaid
expenses and other assets |
|
2,153 |
|
|
3,618 |
|
|
Total current assets |
$ |
111,012 |
|
$ |
96,462 |
|
|
|
|
|
|
|
Non-current assets |
|
|
|
|
Property and
equipment |
|
2,371 |
|
|
2,351 |
|
|
|
Right-of-use
assets |
|
3,060 |
|
|
- |
|
|
|
Intangible
assets |
|
12,806 |
|
|
13,952 |
|
|
|
Goodwill |
|
7,130 |
|
|
7,130 |
|
|
|
Deferred tax
assets |
|
2,105 |
|
|
2,645 |
|
|
|
Other
assets |
|
216 |
|
|
- |
|
|
Total non-current assets |
$ |
27,688 |
|
$ |
26,078 |
|
|
Total assets |
$ |
138,700 |
|
$ |
122,540 |
|
|
|
|
|
|
|
LIABILITIES |
|
|
|
Current liabilities |
|
|
|
|
Accounts
payable and accrued liabilities |
$ |
13,766 |
|
$ |
9,489 |
|
|
|
Income taxes
payable |
|
2,326 |
|
|
117 |
|
|
|
Payable to
loyalty program partners |
|
78,270 |
|
|
69,749 |
|
|
|
Current
portion of lease liabilities |
|
1,323 |
|
|
- |
|
|
|
Current
portion of other liabilities |
|
797 |
|
|
1,680 |
|
|
Total current liabilities |
$ |
96,482 |
|
$ |
81,035 |
|
|
|
|
|
|
|
Non-current liabilities |
|
|
|
|
Lease
liabilities |
|
2,209 |
|
|
- |
|
|
|
Other
liabilities |
|
95 |
|
|
495 |
|
|
|
Deferred tax
liabilities |
|
722 |
|
|
- |
|
|
Total non-current liabilities |
$ |
3,026 |
|
$ |
495 |
|
|
Total liabilities |
$ |
99,508 |
|
$ |
81,530 |
|
|
|
|
|
|
|
SHAREHOLDERS’ EQUITY |
|
|
|
|
Share
capital |
|
45,799 |
|
|
53,886 |
|
|
|
Contributed
surplus |
|
- |
|
|
4,446 |
|
|
|
Accumulated
other comprehensive income (loss) |
|
184 |
|
|
(646 |
) |
|
|
Accumulated
deficit |
|
(6,791 |
) |
|
(16,676 |
) |
|
Total shareholders’ equity |
$ |
39,192 |
|
$ |
41,010 |
|
|
Total liabilities and shareholders’ equity |
$ |
138,700 |
|
$ |
122,540 |
|
|
|
|
|
|
|
|
|
|
|
|
[6] The Company has
initially applied IFRS 16 at January 1, 2019, using the modified
retrospective approach. Under this approach, comparative
information is not restated. |
|
|
|
|
|
|
|
|
Points International Ltd. |
|
|
|
|
|
|
|
|
|
Consolidated Statements of Comprehensive
Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expressed in thousands of United States dollars, except per share
amounts |
|
|
|
|
|
|
|
For the year ended December 31 |
|
2019 |
|
|
|
2018[7] |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
REVENUE |
|
|
|
|
|
|
|
|
|
|
Principal |
|
$ |
374,484 |
|
|
|
$ |
351,743 |
|
|
|
|
Other partner revenue |
|
26,693 |
|
|
|
24,502 |
|
|
|
Total Revenue |
|
$ |
401,177 |
|
|
|
$ |
376,245 |
|
|
|
|
Direct cost of revenue |
|
335,722 |
|
|
|
322,341 |
|
|
|
Gross Profit |
|
$ |
65,455 |
|
|
|
$ |
53,904 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING EXPENSES |
|
|
|
|
|
|
|
|
|
|
Employment costs |
|
31,860 |
|
|
|
27,890 |
|
|
|
|
Marketing and communications |
|
1,608 |
|
|
|
1,460 |
|
|
|
|
Technology services |
|
2,577 |
|
|
|
2,210 |
|
|
|
|
Depreciation and amortization |
|
4,668 |
|
|
|
3,364 |
|
|
|
|
Foreign exchange loss (gain) |
|
401 |
|
|
|
|
(36 |
) |
|
|
|
Other operating expenses |
|
7,994 |
|
|
|
8,786 |
|
|
|
Total Operating Expenses |
|
$ |
49,108 |
|
|
|
$ |
43,674 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance income |
|
|
(908 |
) |
|
|
|
(666 |
) |
|
|
|
Finance costs |
|
211 |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INCOME BEFORE INCOME TAXES |
|
$ |
17,044 |
|
|
|
$ |
10,896 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense |
|
5,155 |
|
|
|
3,104 |
|
|
|
NET INCOME |
|
$ |
11,889 |
|
|
|
$ |
7,792 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER COMPREHENSIVE INCOME (LOSS) |
|
|
|
|
|
|
|
|
|
|
Items that will subsequently be reclassified to profit or
loss: |
|
|
|
|
|
|
|
|
|
Unrealized gain (loss) on foreign exchange derivative designated as
cash flow hedges |
|
556 |
|
|
|
|
(1,394 |
) |
|
|
|
Income tax effect |
|
|
(147 |
) |
|
|
369 |
|
|
|
|
Reclassification to net income of loss on foreign exchange
derivatives designated as cash flow hedges |
|
550 |
|
|
|
7 |
|
|
|
|
Income tax effect |
|
|
(146 |
) |
|
|
|
(2 |
) |
|
|
|
Foreign currency translation adjustment |
|
17 |
|
|
|
- |
|
|
|
Other
comprehensive income (loss) for the period, net of income
tax |
|
|
|
|
|
|
|
|
|
|
$ |
830 |
|
|
$ |
(1,020 |
) |
|
TOTAL COMPREHENSIVE INCOME |
|
$ |
12,719 |
|
|
|
$ |
6,772 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER SHARE |
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share |
|
$ |
0.87 |
|
|
|
$ |
0.54 |
|
|
|
|
|
|
Diluted earnings per share |
|
$ |
0.86 |
|
|
|
$ |
0.54 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
[7] The Company has
initially applied IFRS 16 at January 1, 2019, using the modified
retrospective approach. Under this approach, comparative
information is not restated. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Points International Ltd. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Statements of Changes in Shareholders’
Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Attributable
to equity holders of the Company |
|
Expressed in thousands of United States dollars except number of
shares |
Share Capital |
|
ContributedSurplus |
|
Accumulated other comprehensive income (loss) |
|
Accumulateddeficit |
|
Totalshareholders’equity |
|
|
|
|
|
Number ofShares |
|
Amount |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December 31, 2018 |
14,111,864 |
|
$ |
53,886 |
|
$ |
4,446 |
|
$ |
(646 |
) |
$ |
(16,676 |
) |
$ |
41,010 |
|
|
|
Net income |
- |
|
- |
|
- |
|
- |
|
11,889 |
|
11,889 |
|
|
|
Other comprehensive income, net of tax |
- |
|
- |
|
- |
|
830 |
|
- |
|
830 |
|
|
|
Total comprehensive income |
- |
|
- |
|
- |
|
830 |
|
11,889 |
|
12,719 |
|
|
|
Effect of share option compensation plan |
- |
|
- |
|
782 |
|
- |
|
- |
|
782 |
|
|
|
Effect of RSU compensation plan |
- |
|
- |
|
4,390 |
|
- |
|
- |
|
4,390 |
|
|
|
Share issuances – options exercised |
2,338 |
|
28 |
|
(7 |
) |
- |
|
- |
|
21 |
|
|
|
Settlement of RSUs |
- |
|
1,504 |
|
(4,626 |
) |
- |
|
- |
|
(3,122 |
) |
|
|
Shares purchased and held in trust |
- |
|
(6,350 |
) |
- |
|
- |
|
- |
|
(6,350 |
) |
|
|
Shares repurchased and cancelled |
(872,686 |
) |
(3,269 |
) |
(4,985 |
) |
- |
|
(2,004 |
) |
(10,258 |
) |
|
|
Balance at December 31, 2019 |
13,241,516 |
|
$ |
45,799 |
|
$ |
- |
|
$ |
184 |
|
$ |
(6,791 |
) |
$ |
39,192 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December 31, 2017 |
14,561,450 |
|
$ |
56,394 |
|
$ |
10,647 |
|
$ |
374 |
|
$ |
(24,468 |
) |
$ |
42,947 |
|
|
|
Net income |
- |
|
- |
|
- |
|
- |
|
7,792 |
|
7,792 |
|
|
|
Other comprehensive loss, net of tax |
- |
|
- |
|
- |
|
(1,020 |
) |
- |
|
(1,020 |
) |
|
|
Total comprehensive income |
- |
|
- |
|
- |
|
(1,020 |
) |
7,792 |
|
6,772 |
|
|
|
Effect of share option compensation plan |
- |
|
- |
|
72 |
|
- |
|
- |
|
72 |
|
|
|
Effect of RSU compensation plan |
- |
|
- |
|
4,309 |
|
- |
|
- |
|
4,309 |
|
|
|
Share issuances - options exercised |
119,521 |
|
1,385 |
|
(1,034 |
) |
- |
|
- |
|
351 |
|
|
|
Settlement of RSUs |
- |
|
1,377 |
|
(4,099 |
) |
- |
|
- |
|
(2,722 |
) |
|
|
Shares purchased and held in trust |
- |
|
(3,062 |
) |
- |
|
- |
|
- |
|
(3,062 |
) |
|
|
Shares repurchased and cancelled |
(569,107 |
) |
(2,208 |
) |
(5,449 |
) |
- |
|
- |
|
(7,657 |
) |
|
|
Balance at December 31, 2018 |
14,111,864 |
|
$ |
53,886 |
|
$ |
4,446 |
|
$ |
(646 |
) |
$ |
(16,676 |
) |
$ |
41,010 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Points International Ltd. |
|
|
|
Consolidated Statements of Cash Flows |
|
|
|
Expressed in thousands of United States dollars |
|
|
|
|
|
|
|
|
For the year ended December 31 |
|
2019 |
|
2018[8] |
|
|
|
|
|
|
Cash flows from operating activities |
|
|
|
Net income for the period |
$ |
11,889 |
|
$ |
7,792 |
|
|
Adjustments for: |
|
|
|
Depreciation of property and equipment |
|
1,211 |
|
|
981 |
|
|
Amortization of right-of-use assets |
|
1,164 |
|
|
- |
|
|
Amortization of intangible assets |
|
2,293 |
|
|
2,383 |
|
|
Unrealized foreign exchange loss (gain) |
|
394 |
|
|
(960 |
) |
|
Equity-settled share-based payment
transactions |
|
5,172 |
|
|
4,381 |
|
|
Finance costs |
|
211 |
|
|
- |
|
|
Deferred income tax expense |
|
969 |
|
|
279 |
|
|
Loss (gain) on derivative contracts designated as cash flow
hedges |
|
1,106 |
|
|
(1,387 |
) |
|
Changes in cash held in trust and restricted cash balance |
|
(2,034 |
) |
|
- |
|
|
Changes in
non-cash balances related to operations |
|
|
2,200 |
|
|
6,552 |
|
|
Interest paid |
|
(211 |
) |
|
- |
|
|
Net cash provided by operating activities |
$ |
24,364 |
|
$ |
20,021 |
|
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
Acquisition of property and equipment |
|
(1,231 |
) |
|
(1,204 |
) |
|
Additions to intangible assets |
|
(1,147 |
) |
|
(1,070 |
) |
|
Net cash used in investing activities |
$ |
(2,378 |
) |
$ |
(2,274 |
) |
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
Payment of lease liabilities |
|
(1,229 |
) |
|
- |
|
|
Proceeds from exercise of share options |
|
21 |
|
|
351 |
|
|
Shares repurchased and cancelled |
|
(10,258 |
) |
|
(7,657 |
) |
|
Purchase of share capital held in trust |
|
(6,350 |
) |
|
(3,062 |
) |
|
Taxes paid on net settlement of RSUs |
|
(3,122 |
) |
|
(2,722 |
) |
|
Net cash used in financing activities |
$ |
(20,938 |
) |
$ |
(13,090 |
) |
|
|
|
|
|
|
Effect of exchange rate fluctuations on cash held |
|
(214 |
) |
|
960 |
|
|
|
|
|
|
|
Net increase in cash and cash equivalents |
$ |
834 |
|
$ |
5,617 |
|
|
Cash and cash equivalents at beginning of the period |
$ |
69,131 |
|
$ |
63,514 |
|
|
Cash and cash equivalents at end of the
period |
$ |
69,965 |
|
$ |
69,131 |
|
|
|
|
|
|
|
Interest Received |
$ |
930 |
|
$ |
595 |
|
|
Taxes Received |
$ |
- |
|
$ |
110 |
|
|
Taxes Paid |
$ |
(1,601 |
) |
$ |
(2,838 |
) |
|
|
|
|
|
|
Amounts received and
paid for interest and taxes were reflected as operating cash flows
in the condensed consolidated interim statements of cash
flows. |
|
|
[8] The
Corporation has initially applied IFRS 16 at January 1, 2019, using
the modified retrospective approach. Under this approach
comparative information is not restated. |
|
|
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