~Record annual revenue and asset growth top previous years' results~
VANCOUVER, March 5, 2020 /CNW/ - TIMIA Capital Corporation ("TIMIA" or the "Company") (TSX-V:TCA) today announced financial results for the fourth quarter and year ended November 30, 2019.
2019 Annual Highlights include:
- Record revenue of $3,288,263, up 89% over prior year
- Interest income from investments, included in total revenue, doubled to $3,046,608 compared to last year
- Total assets grew over 90% to $27.1 million compared with the prior year. Cash balance, as part of assets, was $4,662,156 versus $3,749,949 as at November 30, 2018
- TIMIA's loan investment portfolio (Loans receivable) increased 123% to $21,596,037 compared to $9,680,390 in the prior year period
- Adjusted EBITDA* of $247,431 compared with an Adjusted EBITDA of $1,342,749 for the prior year. The change in Adjusted EBITDA reflects the $1,582,906 intermittent gains from loan buyouts in the prior year
- The Company posted a net loss of $1,087,567 compared with a small gain of $18,838 in the prior year. The year over year change reflects the $1,582,906 intermittent gains from loan buyouts in the prior year
- Net loss per share was $0.03 compared with breaking even in the prior year
- A total of $15,895,000 in combined financing has been raised including $545,000 in debentures with warrants by way of a private placement of the Company and $15,350,000 in capital raised in TIMIA Capital 1 Limited Partnership funds
Fourth Quarter 2018 Highlights Include:
- Record quarterly revenue of $998,431, up 99% compared to the same period last year
- TIMIA dispersed US$2,300,000 to two US companies
- TIMIA provided San Francisco-based Resilio, Inc. with a $3,000,000 facility with an initial advance of $900,00
- TIMIA provided a Connecticut-based software company with a $3,000,000 facility with an initial disbursement of $1,400,000
- TIMIA provided follow on investments of US$1,500,000 to three US companies
- Adjusted EBITDA loss of $50,196 compared with an Adjusted EBITDA of $100,347 for the prior year period
"We've achieved record growth in revenue and assets under management for the third year in a row by leveraging our fintech platform and successful business model," said Mike Walkinshaw, CEO of TIMIA. "Our reputation, target markets and related deal flow is growing in the SaaS industry, along with our non-dilutive growth capital for early stage technology companies. We have seen a jump in referred business from our existing network of clients as we continue to broaden our marketing presence to attract new business. Our portfolio of SaaS companies has never been stronger as our fintech platform improves with each potential client."
Detailed Financial Review
During the year ended November 30, 2019, the Company continued to grow its revenue-financing ("RF") business by completing 9 RF investments as well as successfully exiting 1 investment from its loan portfolio. The Company's revenue is primarily interest income generated under the Company's RF model. Interest income in the year ended November 30, 2019 was a record $3,046,608 compared to $1,521,999 in the prior fiscal year.
The 100% increase in interest income is driven from two sources:
- As the Company makes new investments, the number of monthly payments derived from the portfolio grows.
- Under the RF structure, as the revenue of the underlying portfolio grows, the investees make larger blended interest and principal payments to the Company.
Income from transaction and other fees was $241,655 in the year ended November 30, 2019 compared to $216,240 in the prior fiscal year, resulting in a record total revenue of $3,288,263.
TIMIA continues to build the value and size of its portfolio by making new investments and follow-on investments in existing portfolio companies, and actively assisting in their growth plans. Furthermore, management expects the payment amounts to increase over time as both new and follow-on investments are made and as payments increase from the underlying portfolio. During the year ended November 30, 2019, TIMIA benefited from increased payments (combined principal and interest) as a result of the strong revenue growth of its underlying portfolio. At the same time, the Company increased its investments in infrastructure, including key staff and brand awareness.
Total expenses for the year ended November 30, 2019 were $3,461,837 compared with $2,873,167 for the prior year. The increase in expenses reflect TIMIA's investment in infrastructure, increase in interest expense resulting from the issuance of debentures with warrants, marketing and related deal origination expenses and brand awareness.
During the year ended November 30, 2019, the Company posted net loss of $1,087,567 compared with net income of $18,838 for the last fiscal year. The year over year change is primarily due to the Company recognizing intermittent investment gains from loan buyouts of $1,582,906 in 2018 but no material gains in 2019.
As at November 30, 2019, the Company's cash balance was $4,662,156 and working capital was $4,571,341 compared to $3,749,949 and $3,614,268 respectively as at November 30, 2018.
The Company wishes to announce the planned departure of Greg Smith, Chief Investment Officer, for personal reasons in the current quarter. "Greg has been a driving force in the North American SaaS industry," said Mike Walkinshaw, CEO of TIMIA Capital. "I can't thank Greg enough for his passion, his commitment and his presence within TIMIA." Greg will continue to advise TIMIA on an as needed basis.
"I am very proud of TIMIA's success and my role in financing some of North America's most exciting software companies," said Greg Smith. "I am taking on a much larger challenge with ALS, aka Lou Gehrig's disease, and need to focus all my energy on my health and my family."
*Non-GAAP Measures and Other Financial Measures
In managing our business and assessing our financial performance, we supplement the information provided by the financial statements presented in accordance with GAAP with metrics and non-GAAP financial measures which are utilized by our management to evaluate our performance. Although we believe these measures are widely used in the specialty finance industry, some may not be defined by us in precisely the same way as by other companies in the specialty finance industry, so there may not be reliable ways to compare us to other companies. Adjusted EBITDA represents net loss and comprehensive loss from continuing operations (the most directly comparable GAAP measure) excluding amounts for: income tax expense; interest expense; depreciation and amortization; equity-based compensation; and all other non-cash expenses. We believe Adjusted EBITDA is a helpful measure because it allows us to evaluate our performance by removing from our operating results items that do not relate to our core operating performance. Adjusted EBITDA is not a measure of financial performance under GAAP and should not be considered in isolation or as a substitute for net loss and comprehensive loss from continuing operations, the most directly comparable GAAP financial measure. Adjusted EBITDA and is not defined in the same manner by all companies and may not be comparable to other similarly titled measures of other companies unless the definition is the same.
About TIMIA Capital Corporation
TIMIA Capital Corporation is a specialty finance company that provides growth capital to technology companies in exchange for payments based on monthly revenue. This alternative financing option complements both debt and equity financing, while allowing entrepreneurs and existing stakeholders to retain ownership and control of their business. TIMIA's focus is the fast growing, global, business-to-business Software-as-a-Service (or SaaS) segment. We align ourselves with entrepreneurial management teams growing their sales from $1 Million to $10 Million in Annual Recurring Revenue. For more information about TIMIA Capital Corporation, please visit www.timiacapital.com
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.
Certain information and statements in this news release contain and constitute forward-looking information or forward-looking statements as defined under applicable securities laws (collectively, "forward-looking statements"). Forward-looking statements normally contain words like 'believe', 'expect', 'anticipate', 'plan', 'intend', 'continue', 'estimate', 'may', 'will', 'should', 'ongoing' and similar expressions, and within this news release include any statements (express or implied) respecting the growing deal flow in the Saas industry, TIMIA continuing to build the value and size of its portfolio and expectations as to payment amounts increasing over time as both new and follow-on investments are made and as payments increase from the underlying portfolio. Forward-looking statements are not guarantees of future performance, actions, or developments and are based on expectations, assumptions and other factors that management currently believes are relevant, reasonable and appropriate in the circumstances, including, without limitation, the following assumptions: that the Company and its investee companies are able to meet their respective future objectives and priorities, assumptions concerning general economic growth and the absence of unforeseen changes in the legislative and regulatory framework for the Company. Although management believes that the forward-looking statements are reasonable, actual results could be substantially different due to the risks and uncertainties associated with and inherent to Timia's business. Material risks and uncertainties applicable to the forward-looking statements set out herein include, but are not limited to, the Company having insufficient financial resources to achieve its objectives; availability of further investments that are appropriate for the Company on terms that it finds acceptable or at all; successful completion of exits from investments on terms that constitute a gain when no such exits are currently anticipated; intense competition in all aspects of business; reliance on limited management resources; general economic risks; new laws and regulations and risk of litigation. Although Timia has attempted to identify factors that may cause actual actions, events or results to differ materially from those disclosed in the forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, predicted, estimated or intended. Also, many of the factors are beyond the control of Timia. Accordingly, readers should not place undue reliance on forward-looking statements. Timia undertakes no obligation to reissue or update any forward-looking statements as a result of new information or events after the date hereof except as may be required by law. All forward-looking statements contained in this news release are qualified by this cautionary statement.
SOURCE TIMIA Capital Corp.
For further information: Darren Seed, Vice President, Capital Markets & Communications; Mike Walkinshaw, CEO, TIMIA Capital Corporation, (604) 398-8839, [email protected]