EQ Inc. Announces 2014 Financial Results
Toronto, Ontario (FSCwire) - EQ Inc. (TSXV: EQ) (“EQ Works”) a leader in audience targeting for mobile, social, video and display advertising today announced its financial results for the fiscal year ended December 31, 2014. Total revenue from operations for the year was $4.9 million, a decrease from the $8.0 million recorded in the previous year. The adjusted EBITDA loss for the year was approximately $2.7 million, compared to a loss of $2.3 million for the previous year.
“Although 2014 was challenging in terms of our financial performance, the advancements in our audience targeting and data analytics platform have positioned us well for 2015. The number of campaigns executed in 2014 increased over the previous year and our focus on targeting resulted in the strong performance, increased satisfaction and higher retention rates with our clients than we’d seen in the past” said Geoffrey Rotstein, President and CEO.
The EQ proprietary platform is robust and can scale to handle exponentially more capacity than it experienced in 2014. By incorporating industry leading analytics on data, viewability and fraud detection and with an enhanced focus on mobile targeting and distribution, the Company believes it can now focus its 2015 efforts on additional sales and marketing channels.
Non-IFRS Financial Measures
We measure the success of our strategies and performance based on Adjusted EBITDA, which is outlined and reconciled with net income (loss) in the section entitled “Reconciliation of Net Loss for the period to Adjusted EBITDA” in the MD&A. The Company defines Adjusted EBITDA as net income (loss) from operations before; (a) depreciation of property and equipment and amortization of domain properties and other intangible assets; (b) share-based payments, (c) restructuring, (d) impairment of goodwill and domain properties and other intangible assets, (e) Income tax expense and recovery, and (f) finance income and costs, net. Management uses Adjusted EBITDA as a measure of the Company's operating performance because it provides information related to the Company's ability to provide operating cash flows for working capital requirements, capital expenditures and potential acquisitions. The Company also believes that analysts and investors use Adjusted EBITDA as a supplemental measure to evaluate the overall operating performance of companies in its industry.
The non-IFRS financial measure is used in addition to and in conjunction with results presented in the Company’s consolidated financial statements prepared in accordance with IFRS and should not be relied upon to the exclusion of IFRS financial measures. Management strongly encourages investors to review the Company's consolidated financial statements in their entirety and to not rely on any single financial measure. Because non-IFRS financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-IFRS financial measures having the same or similar names. In addition, the Company expects to continue to incur expenses similar to the non-IFRS adjustments described above, and exclusion of these items from the Company's non-IFRS measures should not be construed as an inference that these costs are unusual, infrequent or non-recurring.
The table below reconciles net loss from operations and Adjusted EBITDA for the periods presented:
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Adjusted EBITDA for the year ended December 31, 2014 and 2013 |
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|
Year ended December 31, |
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|
(In thousands of Canadian dollars) |
2014 |
2013 |
|
Net loss |
(4,286) |
(4,471) |
|
Add: |
||
|
Income tax recovery |
(22) |
(237) |
|
Finance costs, net |
112 |
223 |
|
Depreciation of property and equipment |
186 |
273 |
|
Amortization of domain properties and other intangible assets |
1,093 |
1,158 |
|
Share-based payments |
55 |
57 |
|
Impairment of goodwill and domain properties and other intangible assets |
265 |
716 |
|
Gain on sale of domain properties and other intangible assets |
(79) |
- |
|
Adjusted EBITDA |
(2,676) |
(2,281) |
About EQ Works
EQ Works (www.eqworks.com) provides a smarter way to target customers. The Company uses its real-time technology and advanced analytics to detect the actionable data that boosts performance for all web, mobile, social and video initiatives. EQ Works balances the many components that comprise the complex advertising ecosystem and establishes equilibrium for reaching the right audience at the right time through any web or mobile device.
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Neither the TSX-V nor its Regulation Services Provider (as that term is defined in policies of the TSX-V) accepts responsibility for the adequacy or accuracy of this release.
Forward-Looking Statements
This news release may contain forward-looking statements that are based on management’s current expectations and are subject to known and unknown uncertainties and risks, which could cause actual results to differ materially from those contemplated or implied by such forward-looking statements. EQ Inc. is under no obligation to update any forward-looking statements contained herein should material facts change due to new information, future events or otherwise.
EQ Inc.
1255 Bay Street, Suite 400| Toronto, Ontario |M5R 2A9
p: 416.597.8889 f: 416.597.2345
www.eqworks.com
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EQ Inc. |
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|
Unaudited Consolidated Statements of Financial Position |
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|
(In thousands of Canadian dollars) |
|||
|
December 31, 2014 |
December 31, 2013 |
||
|
Assets |
|||
|
Current assets: |
|||
|
Cash and cash equivalents |
$ 311 |
$ 2,797 |
|
|
Accounts receivable |
722 |
2,231 |
|
|
Other current assets |
196 |
222 |
|
|
1,229 |
5,250 |
||
|
Non-current assets: |
|||
|
Investment |
50 |
50 |
|
|
Property and equipment |
124 |
281 |
|
|
Domain properties and other intangible assets |
324 |
1,610 |
|
|
498 |
1,941 |
||
|
Total assets |
$ 1,727 |
$ 7,191 |
|
|
Liabilities and Shareholders' Equity |
|||
|
Current liabilities: |
|||
|
Accounts payable and accrued liabilities |
$ 1,480 |
$ 2,316 |
|
|
Deferred lease inducement |
22 |
14 |
|
|
Finance leases |
64 |
122 |
|
|
Deferred revenue |
90 |
602 |
|
|
1,656 |
3,054 |
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|
Non-current liabilities: |
|||
|
Deferred lease inducement |
73 |
- |
|
|
Finance leases |
- |
64 |
|
|
73 |
64 |
||
|
Shareholders' Equity |
(2) |
4,073 |
|
|
Total liabilities and Shareholders' equity |
$ 1,727 |
$ 7,191 |
|
|
EQ Inc. |
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|
Unaudited Consolidated Statements of Comprehensive Income (Loss) |
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|
(In thousands of Canadian dollars, except per share amounts) |
||||
|
Years ended December 31, 2014 and 2013 |
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Years ended December 31, |
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|
2014 |
2013 |
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|
Revenue |
$ 4,877 |
$ 8,044 |
||
|
Expenses: |
||||
|
Publishing and advertising costs |
2,322 |
4,228 |
||
|
Employee compensation and benefits |
2,990 |
3,605 |
||
|
Other operating expenses |
2,217 |
2,549 |
||
|
Depreciation of property and equipment |
186 |
273 |
||
|
Amortization of domain properties and other intangible assets |
1,093 |
1,158 |
||
|
Impairment of goodwill and other intangible assets |
265 |
716 |
||
|
9,073 |
12,529 |
|||
|
Loss from operations |
(4,196) |
(4,485) |
||
|
Finance income |
13 |
34 |
||
|
Finance costs |
(125) |
(257) |
||
|
Loss before income taxes |
(4,308) |
(4,708) |
||
|
Income tax recovery: |
||||
|
Current |
22 |
2 |
||
|
Deferred |
- |
235 |
||
|
Net Loss |
(4,286) |
(4,471) |
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|
Other comprehensive income: |
||||
|
Foreign currency translation |
||||
|
adjustments to equity |
156 |
436 |
||
|
Other comprehensive income, net of tax |
156 |
436 |
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|
Comprehensive loss |
(4,130) |
(4,035) |
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|
Loss per share: |
||||
|
Basic and diluted |
(0.27) |
(0.28) |
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|
EQ Inc. |
||||
|
Unaudited Consolidated Statements of Cash Flows |
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(In thousands of Canadian dollars) |
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|
Years ended December 31, 2014 and 2013 |
||||
|
2014 |
2013 |
|||
|
Cash flows from operating activities: |
||||
|
Net loss |
(4,286) |
(4,471) |
||
|
Adjustments to reconcile net loss to net cash flows |
||||
|
from operating activities: |
||||
|
Depreciation of property and equipment |
186 |
273 |
||
|
Amortization of domain properties and other intangible assets |
1,093 |
1,158 |
||
|
Amortization of deferred lease inducement |
(28) |
(41) |
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|
Share-based payment |
55 |
57 |
||
|
Foreign exchange loss |
123 |
260 |
||
|
Finance income, net |
2 |
(8) |
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|
Current income tax recovery |
(22) |
(2) |
||
|
Deferred income tax recovery |
- |
(235) |
||
|
Impairment of goodwill and other intangible assets |
265 |
716 |
||
|
Loss on sale of property and equipment |
- |
1 |
||
|
Gain on sale of domain properties and other intangible assets |
(79) |
- |
||
|
Change in non-cash operating working capital |
346 |
160 |
||
|
Cash used in operating activities |
(2,345) |
(2,132) |
||
|
Income taxes received |
22 |
44 |
||
|
Net cash used in operating activities |
(2,323) |
(2,088) |
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Cash flows from financing activities: |
||||
|
Repayment of finance leases |
(123) |
(155) |
||
|
Interest paid |
(15) |
(26) |
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|
Net cash used in financing activities |
(138) |
(181) |
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|
Cash flows from investing activities: |
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|
Interest income received |
13 |
34 |
||
|
Net proceeds from disposal of property and equipment |
- |
2 |
||
|
Net proceeds from disposal of domain properties |
96 |
- |
||
|
Addition to property and equipment |
(11) |
(78) |
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|
Additions to domain properties and other intangible assets |
- |
(51) |
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|
Net cash from (used in) investing activities |
98 |
(93) |
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|
Foreign exchange loss on cash held in foreign currency |
(123) |
(260) |
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|
Decrease in cash and cash equivalents |
(2,486) |
(2,622) |
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|
Cash and cash equivalents, beginning of year |
2,797 |
5,419 |
||
|
Cash and cash equivalents, end of the year |
$ 311 |
$ 2,797 |
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To view this press release as a PDF file, click onto the following link:
public://news_release_pdf/eqworks04242015.pdf
Source: EQ Inc. (TSX:EQ) http://www.eqworks.com/
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