Quorum Information Technologies Inc. (TSX-V: QIS) (OTC Pink: QIFTF)
(“Quorum”), a North American SaaS Software and Services company
providing essential enterprise solutions that automotive
dealerships and Original Equipment Manufacturers (“OEMs”) rely on
for their operations, released its results today for the first
quarter of 2023, ended March 31, 2023. Financial references are
expressed in Canadian dollars unless otherwise indicated. Please
refer to the MD&A and Financial Statements posted onto SEDAR
related to non-IFRS measures and risk factors.
“We continued our disciplined approach to
profitable growth in Q1, with Adjusted EBITDA2 up 51% to $1.3
million and Adjusted Cash Income (“ACI”) up 277% to $0.6 million.
The ACI results includes $0.3 million of spend associated with the
once a year North American Dealers Association (“NADA”) tradeshow,
and when factoring this in, our ACI momentum continued sequentially
as well,” stated Maury Marks, President and CEO. “This increase in
profitability, combined with solid growth in a dynamic macro
environment, is due to the successful execution of several
initiatives, including a more efficient sales strategy prioritizing
cross selling and a $2.0 million annual cost reduction plan to
drive Free Cash Flow3 (“FCF”).
“Through a combination of purposeful product
investment and four strategic acquisitions in the last five
years Quorum now has a uniquely integrated product suite
of 12 essential software solutions and services that we can
sell to dealers to drive their business,” continued Mr. Marks. “We
will remain focussed on executing our profitable growth strategy in
2023, despite the macro-economic environment. I would also like to
sincerely thank our employees who are the driving force behind our
positive Q1 2023 results; their continued innovation ensures Quorum
has a product suite prepared for the future of automotive.”
Consolidated Results for Q1
2023
|
|
Q1
2023 |
%
Change |
Q1
2022 |
|
Total Revenue |
$ |
9,906,478 |
|
7 |
% |
$ |
9,286,058 |
|
|
SaaS Revenue |
$ |
7,025,780 |
|
6 |
% |
$ |
6,620,704 |
|
|
BDC Revenue |
$ |
2,764,735 |
|
11 |
% |
$ |
2,496,257 |
|
|
Recurring
Revenue |
$ |
9,790,515 |
|
7 |
% |
$ |
9,116,961 |
|
|
Gross
Margin |
$ |
4,638,269 |
|
5 |
% |
$ |
4,400,199 |
|
|
Gross Margin % |
|
47 |
% |
|
|
47 |
% |
|
EPS
(Loss) |
-$ |
0.008 |
|
|
-$ |
0.008 |
|
|
Net
Loss |
-$ |
559,909 |
|
6 |
% |
-$ |
597,617 |
|
|
Adjusted EBITDA |
$ |
1,332,077 |
|
51 |
% |
$ |
882,000 |
|
|
Adjusted EBITDA Margin |
|
13 |
% |
|
|
9 |
% |
|
Adjusted Cash Income |
$ |
577,231 |
|
277 |
% |
$ |
153,182 |
|
|
|
|
|
|
First Quarter Results
-
Adjusted EBITDA margin was 13% for Q1 2023 as compared to 9% for Q1
2022.
-
Adjusted Cash Income increased by $0.4 million to $0.6 million as
compared to $0.2 million Q1 2022.
-
Total revenue increased by 7% to $9.9 million in Q1 2023 compared
to $9.3 million in Q1 2022.
-
Recurring SaaS revenue increased by 6% to $7.0 million in Q1 2023
compared to $6.6 million in Q1 2022.
-
Recurring BDC services revenue increased by 11% to $2.8 million in
Q1 2023 compared to $2.5 million in Q1 2022.
-
Gross margin increased to $4.6 million and 47% of total revenue in
Q1 2023 compared to $4.4 million and 47% of total revenue for Q1
2022. Gross margin increased by 5% as compared to Q1 2022.
SaaS-based operational Key Performance
Indicators (“KPIs”) are as follows:
|
Q1 2022 |
Q2 2022 |
Q3 2022 |
Q4 2022 |
Q1 2023 |
Dealer Rooftop Count - Canada |
923 |
1,343 |
1,350 |
1,322 |
1,315 |
Dealer Rooftop Count - US |
116 |
116 |
114 |
118 |
118 |
Dealer Rooftop Count - Total |
1,039 |
1,459 |
1,464 |
1,440 |
1,433 |
MRRPU |
$2,124 |
$1,600 |
$1,597 |
$1,626 |
$1,634 |
Monthly recurring revenue per unit (“MRRPU”)
implies that, as of the end of Q1 2023, each dealership (“Dealer
Rooftop”) represents approximately $19.6K of SaaS annual recurring
revenue (“ARR”).
Q1 2023 MRRPU decreased as compared to Q1 2022
due to the addition of rooftops as a result of the Accessible
Accessories acquisition. The reduction in rooftops, as compared to
Q4 2022, was primarily due to a reduction in Accessible Accessories
brand’s rooftops. Growth in the number of Accessible Accessories
rooftops is anticipated as Accessible Accessories and Autovance
integration is introduced.
Q1 2023 Business Highlights
- In January
2023, Quorum released its 2022 inaugural Sustainability Statement
to address environmental and social topics that are, or may be,
financially material to its long-term sustainability.
- In January
2023, Quorum released its new mobile Sales Customer Relationship
(“CRM”) application. The mobile Sales CRM application allows
dealership sales staff to have the full power of the DealerMine
branded Sales CRM solution in their hand.
- In January
2023, Quorum completed the integration between General Motors
(“GM”) USA’s Service Advisor Vehicle Interface System (“SAVI”) and
the Quorum DMS and the PowerLane software solution. The new GM
integration allows onboard vehicle diagnostics data to be delivered
to Quorum’s DMS and PowerLane solutions when a customer’s vehicle
is in for service.
- In January
2023, Quorum completed the rollout of Version 4.6 of the Nissan and
Infiniti North America DMS integration. Version 4.6 provides all
parties with a more reliable and complete dataset in all areas of
dealership operations.
- In January
2023, Quorum announced that its DealerMine branded Online Service
Scheduling (“OSS”) has a new user interface and an improved user
experience. Additionally, DealerMine’s OSS was enhanced to allow
for direct integration with select OEM maintenance menus and
vehicle recall information.
Quorum Q1 2023 Annual Results Conference
Call Details and Investor Presentation
Maury Marks, President and Chief Executive
Officer and Marilyn Bown, Chief Financial Officer will present the
Q1 2023 Results at a conference call with concurrent audio webcast,
scheduled for:
Date: |
|
Thursday, May
25th, 2023 |
Time: |
|
11:00 am MT (1:00 pm ET) |
Dial-In #: |
|
Toll-Free North America: 1 (888)
660-6411 |
Conference ID: |
|
2512218 |
Webcast Link: |
|
Quorum Q1 2023 Results Conference Call (Webcast) |
|
|
|
An updated Investor Presentation, replay of the
results conference call, and transcripts of the conference call,
will also be available at www.QuorumInformationSystems.com.
About Quorum Information Technologies
Inc.
Quorum is a North American SaaS Software and
Services company providing essential enterprise solutions that
automotive dealerships and Original Equipment Manufacturers
(“OEMs”) rely on for their operations, including:
- Quorum’s
Dealership Management System (DMS), which automates,
integrates, and streamlines key processes across departments in a
dealership, and emphasizes revenue generation and customer
satisfaction.
-
DealerMine CRM, a sales and service Customer
Relationship Management (“CRM”) system and set of Business
Development Centre services that drives revenue into the critical
sales and service departments in a dealership.
-
Autovance, a modern retailing platform that helps
dealerships attract more business through Digital Retailing,
improve in-store profits and closing rates through its desking tool
and maximize their efficiency and CSI through Autovance’s F&I
menu solution.
-
Accessible Accessories, a digital retailing
platform that allows franchised dealerships to efficiently increase
their vehicle accessories revenue.
Quorum Information Technologies Inc. is traded
on the TSX Venture Exchange (“TSX-V”) under the symbol QIS. For
additional investor information, please visit
www.QuorumInformationSystems.com.
Contacts:
Maury MarksPresident and Chief Executive
Officer403-777-0036Maury.Marks@QuorumInfoTech.com
Marilyn BownChief Financial
Officer403-777-0036Marilyn.Bown@QuorumInfoTech.com
Daniela TrnkaInvestor
Relations403-777-0036Daniela.Trnka@QuorumInfoTech.com
Forward-Looking Information
This press release may contain certain
forward-looking statements and forward-looking information
(“forward-looking information”) within the meaning of applicable
Canadian securities laws. Forward-looking information is often, but
not always, identified by the use of words such as “anticipate”,
“believe”, “plan”, “intend”, “objective”, “continuous”, “ongoing”,
“estimate”, “expect”, “may”, “will”, “project”, “should” or similar
words suggesting future outcomes. Quorum believes the expectations
reflected in such forward-looking information are reasonable but no
assurance can be given that these expectations will prove to be
correct and such forward-looking information should not be unduly
relied upon.
Forward-looking information is not a guarantee
of future performance and involves a number of risks and
uncertainties some of which are described herein. Such
forward-looking information necessarily involves known and unknown
risks and uncertainties, which may cause Quorum’s actual
performance and financial results in future periods to differ
materially from any projections of future performance or results
expressed or implied by such forward-looking information.
Quorum has filed its Q1 2023 unaudited
consolidated financial statements and notes thereto as at and for
the three months ended March 31, 2023, and accompanying management
and discussion and analysis in accordance with National Instrument
51-102 – Continuous Disclosure Obligations adopted by the
Canadian securities regulatory authorities.
Quorum Information Technologies Inc. is traded
on the Toronto Venture Exchange (TSX-V) under the symbol QIS. For
additional information please go
to www.QuorumInformationSystems.com.
Neither the TSX Venture Exchange nor its regulation services
provider (as that term is defined in the policies of the TSX
Venture Exchange) has reviewed this release and neither accepts
responsibility for the adequacy or accuracy of this release.
1 Adjusted Cash Income (“ACI”) (non-GAAP) – Adjusted EBITDA less
capitalized salaries and overhead.2 Adjusted EBITDA – Net income
(loss) before interest and financing costs, taxes, depreciation,
amortization, stock-based compensation, foreign exchange gains and
losses, one-time acquisition related expenses and restructuring
expenses.3 Free Cash Flow – Adjusted Cash Income less interest on
long term debt and bank charges and IFRS 16 lease cash expense not
included in Adjusted EBITDA.
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