Advantex Announces Fiscal 2021 Third Quarter Results

TORONTO, May 28, 2021 /CNW/ - Advantex Marketing International Inc. (CSE: ADX) ("Advantex"), a leader in the merchant cash advance and loyalty marketing products for merchants, announced its results for the three and nine months ended March 31, 2021.

Highlights of financial results for three and nine months ended March 31, 2021 compared to three and nine months ended March 31, 2020:

	Three months				Nine months				Three months		Nine months
	March 2021		March 2020		March 2021		March 2020		Inc./(Dec)		Inc./(Dec)
	$		$		$		$		$		$
Revenues	$	240,651	$	741,963	$	939,349	$	2,431,942	$	(501,312)	$	(1,492,593)
Direct expenses	$	57,262	$	692,893	$	313,854	$	1,100,914	$	(635,631)	$	(787,060)
Gross profit	$	183,389	$	49,070	$	625,495	$	1,331,028	$	134,319	$	(705,533)
Selling and General & Administrative expenses	$	366,287	$	606,461	$	1,006,497	$	1,850,484	$	(240,174)	$	(843,987)
(Loss) from operations before depreciation, amortization and interest	$	(182,898)	$	(557,391)	$	(381,002)	$	(519,456)	$	(374,493)	$	(138,454)
Stated interest expense - Loan payable, and 9% Non convertible debentures payable	$	205,250	$	301,059	$	677,215	$	1,059,413	$	(95,809)	$	(382,198)
(Loss) from operations before depreciation, amortization, non cash interest and non cash items	$	(388,148)	$	(858,450)	$	(1,058,217)	$	(1,578,869)	$	(470,302)	$	(520,652)
Interest expense - Accretion charges,  Restructuring bonus and Amortization of transaction costs related to 9% Non-convertible debentures payable	$	132,141	$	154,595	$	449,793	$	442,753	$	(22,454)	$	7,040
Interest - Lease	$	3,090	$	4,976	$	10,582	$	14,929	$	(1,886)	$	(4,347)
Depreciation of right of use asset	$	11,372	$	16,333	$	34,118	$	49,001	$	(4,961)	$	(14,883)
Depreciation of property, plant and equipment	$	-	$	629	$	-	$	15,210	$	(629)	$	(15,210)
Net (loss) and comprehensive (loss)	$	(534,751)	$	(1,034,983)	$	(1,552,710)	$	(2,100,762)	$	(500,232)	$	(548,052)
Fuller details available in the Consolidated Financial Statements and MD&A available under Advantex's profile on www.sedar.com

The above tabulation is a non-GAAP presentation and is provided to assist readers in understanding Advantex's financial performance. The information is extracted from consolidated financial statements for three and nine months ended March 31, 2021.

About Advantex:

Advantex provides working capital to merchants. Advantex also provides specialized marketing programs that enable members of Aeroplan to earn Aeroplan points at participating merchants.

Advantex shares trade on the Canadian Securities Exchange under the symbol ADX.

For more information go to Advantex's profile on www.sedar.com         

Advantex Marketing International Inc.
Consolidated Statements of Financial Position (unaudited)
(expressed in Canadian dollars)

	Note	At March 31,  2021		At June  30, 2020
		$		$
Assets
Current assets
Cash		$	104,180	$	166,601
Accounts receivable			78,554		118,901
Transaction credits	5		2,092,782		3,923,917
Prepaid expenses and sundry assets			46,371		58,781
		$	2,321,887	$	4,268,200
Non-current assets
Right of use asset	15	$	64,444	$	98,562
		$	64,444	$	98,562
Total assets		$	2,386,331	$	4,366,762
Liabilities
Current liabilities
Loan payable	6	$	2,719,782	$	4,369,006
Lease liability			69,967		64,452
Loan	16		60,000		40,000
Accounts payable and accrued liabilities			2,582,822		2,364,759
9% Non convertible debentures payable	7		-		6,611,576
		$	5,432,571	$	13,449,793
Non-current Liabilities
9% Non convertible debentures payable	7	$	4,609,582	$	-
Lease liability	15		31,493		84,679
		$	4,641,075	$	84,679
Shareholders' deficiency
Share capital	8	$	24,530,555	$	24,530,555
Contributed surplus			7,150,275		4,117,170
Accumulated other comprehensive loss			(47,383)		(47,383)
Deficit			(39,320,762)		(37,768,052)
Total deficiency		$	(7,687,315)	$	(9,167,710)
Total liabilities and deficiency		$	2,386,331	$	4,366,762

Going concern (note 2), Commitments and contingencies (note 11)

The accompanying notes are an integral part of these consolidated financial statements

Approved by the Board

Director: Signed "Marc Lavine"	Director: Signed "Kelly Ambrose"
Marc Lavine	Kelly Ambrose

Advantex Marketing International Inc.
Consolidated Statements of Loss and Comprehensive Loss (unaudited)
(expressed in Canadian dollars)

	Note	Three months ended March 31				Nine months ended March 31
		2021		2020		2021		2020
		$		$		$		$
	18				Amended				Amended
Revenues	14
Marketing activities		$	90,013	$	216,843	$	397,093	$	633,506
Interest income			150,638		525,120		542,256		1,798,436
		$	240,651	$	741,963	$	939,349	$	2,431,942
Direct expenses	13/14		57,262		692,893		313,854		1,100,914
			183,389		49,070		625,495		1,331,028
Operating expenses
Selling and marketing	13/14		166,728		203,848		423,688		582,546
General and administrative	13/14		199,559		402,613		582,809		1,267,938
(Loss) from operations before depreciation, amortization and interest			(182,898)		(557,391)		(381,002)		(519,456)
Stated interest expense - loan payable, and debentures	6/7		205,250		301,059		677,215		1,059,413
Interest - Lease	15		3,090		4,976		10,582		14,929
Non-cash interest expense (accretion charges), restructuring bonus and amortization of transaction costs related to non-convertible debentures payable	7		132,141		154,595		449,793		442,753
Depreciation of right of use asset	15		11,372		16,333		34,118		49,001
Depreciation of property, plant and equipment			-		629		-		15,210
Net (loss) and comprehensive (loss)		$	(534,751)	$	(1,034,983)	$	(1,552,710)	$	(2,100,762)
(Loss) per share
Basic and Diluted	12	$	(0.00)	$	(0.00)	$	(0.00)	$	(0.00)

The accompanying notes are an integral part of these consolidated financial statements

Advantex Marketing International Inc.
Consolidated Statements of Changes in Shareholders' Deficiency (unaudited)
(expressed in Canadian dollars)

	Class A preference shares		Common shares		Contributed surplus		Accumulated other comprehensive loss		Deficit		Total
	$		$		$		$		$		$
Balance - July 1, 2019	$	3,815	$	24,526,740	$	4,090,382	$	(47,383)	$	(34,840,656)	$	(6,267,102)
Reported at December 31, 2019 as adjustment to deficit on account of adoption of IFRS 16 Leases at July 1, 2019		-		-		-		-		(35,218)		(35,218)
Reported Net (loss) and comprehensive (loss)		-		-		-		-		(2,085,639)		(2,085,639)
Reported as balance at March 31, 2020		3,815		24,526,740		4,090,382		(47,383)		(36,961,513)		(8,387,959)
Adjustments on account of amendments made at year end June 30, 2020 to initial computations on adoption of IFRS 16 Leases at July 1, 2019, and initial recording on issuance of $200,000 9% Non convertible debentures payable in October 2019
Reversal of adjustment made to deficit at July 1, 2019 - IFRS 16 Leases		-		-		-		-		35,218		35,218
Recording of contributed surplus - 9% Non convertible debentures payable		-		-		26,788		-		-		26,788
Increase in Reported Net (loss) and comprehensive (loss)		-		-		-		-		(15,122)		(15,122)
Amended Balance - March 31, 2020	$	3,815	$	24,526,740	$	4,117,170	$	(47,383)	$	(36,941,417)	$	(8,341,075)
Balance - July 1, 2020	$	3,815	$	24,526,740	$	4,117,170	$	(47,383)	$	(37,768,052)	$	(9,167,710)
Recording of contributed surplus - 9% Non convertible debentures payable		-		-		3,033,105		-		-		3,033,105
Net (loss) and comprehensive (loss)		-		-		-		-		(1,552,710)		(1,552,710)
Balance - March 31, 2021	$	3,815	$	24,526,740	$	7,150,275	$	(47,383)	$	(39,320,762)	$	(7,687,315)
The accompanying notes are an integral part of these consolidated financial statements

Advantex Marketing International Inc.
Consolidated Statements of Cash Flow (unaudited)
(expressed in Canadian dollars)

	Note	Nine months ended March 31, 2021		Nine months ended March 31, 2020
		$		$
	18				Amended
Operational activities
Net (loss) for the period		$	(1,552,710)	$	(2,100,762)
Adjustments for:
Accrued and unpaid interest - 9% Non convertible debentures payable			394,243		383,891
Interest - Lease	15		10,582		14,929
Depreciation of right of use asset	15		34,118		49,001
Depreciation of property, plant and equipment			-		15,210
Loss on disposal of property, plant & equipment			-		45
Accretion charge - 9% Non convertible debentures payable	7		248,797		242,098
Restructuring bonus - 9 % Non convertible debentures payable	7		187,689		192,827
Amortization of transaction costs - 9% Non convertible debentures payable	7		13,307		7,828
			(663,974)		(1,194,933)
Changes in items of working capital
Accounts receivable			40,347		19,301
Transaction credits			1,831,135		4,715,015
Prepaid expenses and sundry assets			12,410		(8,851)
Accounts payable and accrued liabilities			218,063		89,608
			2,101,955		4,815,073
Net cash provided by operating activities		$	1,437,981	$	3,620,140
Financing activities
Payment for lease	15	$	(58,253)	$	(58,253)
Gross proceeds - 9% Non convertible debentures payable	7		250,000		200,000
Transaction costs - 9% Non convertible debentures payable	7		(62,925)		(40,703)
Proceeds from loan - Canada Emergency Business Account			20,000		-
(Decrease) of Loan payable	6		(1,649,224)		(3,626,308)
Net cash (used in) financing activities		$	(1,500,402)	$	(3,525,264)
(Decrease)/Increase in cash during the period		$	(62,421)	$	94,876
Cash at beginning of period			166,601		119,636
Cash at end of period		$	104,180	$	214,512
Additional information
Interest paid		$	282,972	$	623,091
Cash		$	104,180	$	214,512
The accompanying notes are an integral part of these consolidated financial statements

SOURCE Advantex Marketing International Inc.

Mukesh Sabharwal, Vice-President and Chief Financial Officer, Tel: [phone], Email: [email protected]