EQ Inc. Announces Fourth Quarter and 2015 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 fourth quarter and fiscal year ended December 31, 2015. Total revenue from operations for the quarter ended December 31, 2015 was approximately $0.9 million, an improvement of 10% compared with the $0.8 million recorded in the previous year of 2014. Total revenue for the year was $3.7 million, a decrease from the $4.9 million recorded in the previous year and the adjusted EBITDA loss for the year was approximately $1.9 million, an improvement of 27% from the previous year.
A continued focus on sales for the first quarter of 2016 is beginning to show results as the Company is forecasting first quarter sequential revenue growth of approximately 10% to 11%.
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 (g) loss on derivative liability. 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 year ended December 31, 2015 and 2014 |
||
|
(In thousands of Canadian dollars) |
2015 |
2014 |
|
Net loss |
(2,296) |
(4,286) |
|
Add: |
||
|
Finance costs, net |
55 |
112 |
|
Depreciation of property and equipment |
119 |
186 |
|
Amortization of domain properties and other intangible assets |
112 |
1,093 |
|
Share-based payments |
59 |
55 |
|
Impairment of domain properties and other intangible assets |
- |
265 |
|
Loss (gain) on sale of domain properties and other intangible assets |
1 |
(79) |
|
Loss on derivative liability - warrants |
24 |
- |
|
Income tax recovery |
(18) |
(22) |
|
Adjusted EBITDA |
(1,944) |
(2,676) |
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.
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 |
|||
|
(In thousands of Canadian dollars) |
|||
|
December 31, 2015 |
December 31, 2014 |
||
|
Assets |
|||
|
Current assets: |
|||
|
Cash |
$ 115 |
$ 311 |
|
|
Accounts receivable |
677 |
722 |
|
|
Other current assets |
202 |
196 |
|
|
994 |
1,229 |
||
|
Non-current assets: |
|||
|
Investment |
251 |
50 |
|
|
Property and equipment |
16 |
124 |
|
|
Domain properties and other intangible assets |
242 |
324 |
|
|
509 |
498 |
||
|
Total assets |
$ 1,503 |
$ 1,727 |
|
|
Liabilities and Shareholders' Deficiency |
|||
|
Current liabilities: |
|||
|
Accounts payable and accrued liabilities |
$ 2,050 |
$ 1,480 |
|
|
Deferred lease inducement |
20 |
22 |
|
|
Loans and borrowings |
1,323 |
- |
|
|
Derivative liability - warrants |
259 |
- |
|
|
Finance lease |
- |
64 |
|
|
Deferred revenue |
22 |
90 |
|
|
3,674 |
1,656 |
||
|
Non-current liabilities: |
|||
|
Deferred lease inducement |
63 |
73 |
|
|
63 |
73 |
||
|
Shareholders' deficiency |
(2,234) |
(2) |
|
|
Total liabilities and Shareholders' deficiency |
$ 1,503 |
$ 1,727 |
|
|
EQ Inc. |
||||
|
Unaudited Consolidated Statements of Loss and Comprehensive Loss |
||||
|
(In thousands of Canadian dollars, except per share amounts) |
||||
|
Years ended December 31, 2015 and 2014 |
||||
|
2015 |
2014 |
|||
|
Revenue |
$ 3,684 |
$ 4,877 |
||
|
Expenses: |
||||
|
Publishing cost |
1,977 |
2,322 |
||
|
Employee compensation and benefits |
1,978 |
2,990 |
||
|
Other operating expenses |
1,733 |
2,217 |
||
|
Depreciation of property and equipment |
119 |
186 |
||
|
Amortization of domain properties and other intangible assets |
112 |
1,093 |
||
|
Impairment of domain properties and other intangible assets |
- |
265 |
||
|
5,919 |
9,073 |
|||
|
Loss from operations |
(2,235) |
(4,196) |
||
|
Finance income |
92 |
13 |
||
|
Loss on derivative liability - warrants |
(24) |
- |
||
|
Finance costs |
(147) |
(125) |
||
|
Loss before income taxes |
(2,314) |
(4,308) |
||
|
Income tax recovery |
18 |
22 |
||
|
Net Loss |
(2,296) |
(4,286) |
||
|
Other comprehensive income (net of tax): |
||||
|
Items that maybe reclassified to net income (loss) |
||||
|
Net change in fair value of available-for-sale financial assets |
201 |
- |
||
|
Foreign currency translation |
||||
|
adjustments to equity |
(196) |
156 |
||
|
Other comprehensive income, net of tax |
5 |
156 |
||
|
Comprehensive loss |
(2,291) |
(4,130) |
||
|
Loss per share: |
||||
|
Basic and diluted |
(0.14) |
(0.27) |
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|
EQ Inc. |
||||
|
Unaudited Consolidated Statements of Cash Flows |
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|
(In thousands of Canadian dollars) |
||||
|
Years ended December 31, 2015 and 2014 |
||||
|
2015 |
2014 |
|||
|
Cash flows from operating activities: |
||||
|
Net loss |
(2,296) |
(4,286) |
||
|
Adjustments to reconcile net loss to net cash flows |
||||
|
from operating activities: |
||||
|
Depreciation of property and equipment |
119 |
186 |
||
|
Amortization of domain properties and other intangible assets |
112 |
1,093 |
||
|
Amortization of deferred lease inducement |
(12) |
(28) |
||
|
Loss on derivative liability - warrants |
24 |
- |
||
|
Share-based payments |
59 |
55 |
||
|
Unrealized foreign exchange loss |
44 |
123 |
||
|
Finance income, net |
55 |
2 |
||
|
Current income tax recovery |
(18) |
(22) |
||
|
Impairment of domain properties and other intangible assets |
- |
265 |
||
|
Loss (gain) on sale of domain properties and other intangible assets |
1 |
(79) |
||
|
Change in non-cash operating working capital |
389 |
346 |
||
|
Cash used in operating activities |
(1,523) |
(2,345) |
||
|
Income taxes received |
18 |
22 |
||
|
Net cash used in operating activities |
(1,505) |
(2,323) |
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|
Cash flows from financing activities: |
||||
|
Repayment of finance lease |
(64) |
(123) |
||
|
Term loan |
175 |
- |
||
|
Repayment of term loan |
(73) |
- |
||
|
Promissory notes |
1,335 |
- |
||
|
Interest paid |
(25) |
(15) |
||
|
Net cash from (used) in financing activities |
1,348 |
(138) |
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|
Cash flows from investing activities: |
||||
|
Interest income received |
5 |
13 |
||
|
Net proceeds from disposal of domain properties |
- |
96 |
||
|
Addition to property and equipment |
- |
(11) |
||
|
Net cash from investing activities |
5 |
98 |
||
|
Decrease in cash |
(152) |
(2,363) |
||
|
Foreign exchange loss on cash held in foreign currency |
(44) |
(123) |
||
|
Cash, beginning of year |
311 |
2,797 |
||
|
Cash, end of the year |
$ 115 |
$ 311 |
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To view this press release as a PDF file, click onto the following link:
public://news_release_pdf/EQInc04292016_1.pdf
Source: EQ Inc. (TSX Venture:EQ) http://www.eqworks.com/
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