TORONTO, ONTARIO — (May 18, 2018) Symbility Solutions Inc. (“Symbility” or the “Company”) (TSX.V: SY), a global software company focused on modernizing the insurance industry, today announced financial results for the first quarter ending March 31, 2018. “I am pleased to report another strong quarter as we continue to grow revenue and show profitability, a trend we expect to continue going forward,” said James Swayze, CEO of Symbility Solutions. “With the sale of Symbility Health, we have realigned our focus around our P&C Insurance platform and are looking to leverage our strengthened balance sheet to drive scale into the business.” Mr. Swayze continued, “The success we are enjoying in the UK through the launch of new products last year is now translating into pipeline growth in multiple markets. Insurtech momentum is compelling top 10 companies to challenge the status quo of their operations and begin testing new claim submission and settlement products which is seen as Symbility’s strength. Over the course of this year, we look forward to expanding the reach of our consumer-facing product LINK, as policyholders continue to demand more transparency from their insurance providers.”
2018 Guidance
In 2018, Symbility estimates that it will generate revenue of $40 million, compared to $35.6 revenue in 2017 from continuing operations. This revenue growth is expected to generate Adjusted EBITDA1 in the range of $4 million to $5 million, compared to $3.9 million Adjusted EBITDA in 2017 from continuing operations. The Company also expects to have positive cash flow.
Symbility Health
As announced on May 8, 2018, Symbility Solutions sold its Symbility Health division for $16.5 million, subject to working capital adjustments. This divestiture allows Symbility to focus on the growth and expansion of its P&C Insurance platform which is now offered in eight countries on four continents. The cash proceeds of this deal give Symbility a strengthened balance sheet in excess of $20 million which will allow the company to contemplate further transformative M&A as it continues to strategically review growth and scale opportunities.
First Quarter Financial Results
- Consolidated revenue from continuing operations for the first quarter of 2018 ended March 31, 2018 was $8.6 million compared to $7.7 million in the same period in 2017 from containing operations, an increase of 11 per cent.
- The Company reported Adjusted EBITDA from continuing operations of $0.8 million in first quarter of 2018 compared to an Adjusted EBITDA loss of ($0.4) million in the first quarter of 2017, an improvement of 325 per cent.
- Net income and comprehensive income from continuing operations for the first quarter of 2018 was $0.1 million compared to a net loss of ($1.1) million for the same period in 2017.
- The Company had income per share2 of $0.00 in the first quarter of 2018 compared to a loss per share of ($0.00) in the first quarter of 2017.
- The Company had a cash balance of $10.9 million as at March 31, 2018 compared to a cash balance of $8.2 million as at December 31, 2017.
Selected Financial Information
| in thousands of dollars | three months ended March 31, | |
| Continuing Operations | 2018 | 2017 |
| Revenue | $8,552 | $7,738 |
| Cost of Sales | $2,121 | $2,322 |
| Expenses | $6,340 | $6,535 |
| Net Income (Loss) | $100 | ($1,130) |
| Adjusted EBITDA1 | $829 | ($369) |
| Income (Loss) per share2 | $0.00 | ($0.00) |
| As at |
March 31, 2018 |
December 31, 2017 |
| Cash and cash equivalents | $10,942 | $8,238 |
| Total Assets | $39,679 | $37,971 |
| Total long-term liabilities | $6 | $389 |
| three months ended March 31, | ||
| Reconciliation of Adjusted EBITDA | 2018 | 2017 |
| IFRS Net Income (Loss) | $175 | ($1,134) |
| Discontinued operations | (75) | 4 |
| Finance income, net | (17) | (4) |
| Depreciation and amortization | 454 | 604 |
| Stock-based compensation | 159 | 146 |
| Transaction Related Expense | 125 | – |
| Income tax expense | 8 | 15 |
| Adjusted EBITDA1 (Continuing Operations) | $829 | ($369) |
1 Adjusted EBITDA is a non-IFRS measure and is calculated as earnings before interest income, taxes, depreciation and amortization, impairment losses, stock-based compensation, and other non-recurring gains or losses including transaction costs related to acquisition and restructuring cost. Management believes Adjusted EBITDA is a useful measure that facilitates period-to-period operating comparisons. Adjusted EBITDA does not have any standardized meaning prescribed by IFRS and is not necessarily comparable to similar measures presented by other companies. Adjusted EBITDA should not be considered in isolation or as a substitute for net earnings (loss) prepared in accordance with IFRS as issued by IASB. All other financial measures referenced herein have been prepared in accordance with International Financial Reporting Standards unless stated otherwise.
2 In Canadian dollars, rounded to the nearest cent.
Investor Conference Call
Symbility will host a live webcast and conference call Friday, May 18, 2018, at 11 a.m. Eastern Time to review highlights of its quarterly results, recent transaction news, discussion on guidance and general business update. All interested parties are welcome to join the live webcast, which can be accessed at https://event.on24.com/wcc/r/1668865/A2E153DB5C827403F60809DBB766ECB8. Participants may also join the conference call by dialing toll free (888) 231-8191 or (647) 427-7450 for international participants. A replay of the webcast will be available on Symbility’s website.
About Symbility
Symbility (TSX.V: SY) believes in creating world-class experiences that simplify business and improve lives. With a history in modernizing insurance claims solutions for the property & casualty industry, Symbility has established itself as a partner that puts security, efficiency and customer experience first. Symbility PROPERTY™ brings smarter thinking to property insurance. Our strategic services team, Symbility INTERSECT™ empowers a variety of businesses with smarter mobile and IoT product development strategy, design thinking and engineering excellence. We push industries forward and prove that change for the better is entirely possible. symbilitysolutions.com
Caution Regarding Forward-looking Information
This press release may contain forward-looking statements with respect to the Company, its products and operations and the contemplated financing. These statements generally can be identified by use of forward looking words such as “may”, “will”, “expect”, “estimate”, “anticipate”, “intends”, “believe” or “continue” or the negative thereof or similar variations. The actual results and performance of the Company discussed herein could differ materially from those expressed or implied by such statements. Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Important factors that could cause actual results to differ materially from expectations include, among other things, general economic and market factors, competition, changes in government regulations, and the factors described under “Risk Factors” in the Management’s Discussion and Analysis and Annual Information Form of the Company which are available at www.sedar.com. The cautionary statements qualify all forward-looking statements attributable to the Company and persons acting on their behalf. Unless otherwise stated, all forward-looking statements speak only as of the date of this press release and the Company has no obligation to update such statements.
This press release should be read in conjunction with Company’s consolidated financial statements and related notes, and management’s discussion and analysis for the quarter ending March 31, 2018, copies of which can be found at www.sedar.com.
Neither 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 release.
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All trade names are the property of their respective owners.
For Further Information, Please Contact:
| James R. Swayze Chairman & Chief Executive Officer (647) 775- 8603 jswayze@nullsymbilitysolutions.com |
Blair R. Baxter Chief Financial Officer (647) 775-8608 bbaxter@nullsymbilitysolutions.com |
| Lucy De Oliveira VP, Global Marketing (647) 775-8607 ldeoliveira@nullsymbilitysolutions.com |
Babak Pedram Investor Relations (416) 644-5081 bpedram@nullvirtusadvisory.com |
Symbility Solutions Inc. Interim Consolidated Statements of Financial Position
(Unaudited – In thousands of Canadian dollars)
| March 31, 2018 | December 31, 2017 | |
| Assets Current assets |
||
| Cash and cash equivalents | 10,942 | 8,238 |
| Accounts receivable | 5,145 | 7,651 |
| Prepaid expenses | 1,517 | 1,614 |
| Tax credits receivables | 447 | 665 |
| 18,051 | 18,168 | |
| Assets held for sale including cash | 2,306 | – |
| 20,357 | 18,168 | |
| Long-term assets | ||
| Prepaid expenses | 44 | 54 |
| Security deposits | 115 | 115 |
| Property and equipment | 455 | 502 |
| Intangible assets | 7,945 | 8,369 |
| Goodwill | 10,763 | 10,763 |
| 39,679 | 37,971 | |
| Liabilities Current Liabilities |
||
| Accounts payable | 696 | 1,786 |
| Accrued liabilities Provisions | 3,643 | 4,079 |
| Provisions | 174 | 220 |
| Deferred revenue | 3,772 | 2,121 |
| 8,285 | 8,206 | |
| Liabilities directly associated with the assets held for sale | 1,659 | – |
| 9,944 | 8,206 | |
| Long-term liabilities | ||
| Accrued liabilities and others | 6 | 7 |
| Customer deposits | – | 382 |
| 9,950 | 8,595 | |
| Shareholders’ equity | 29,729 | 29,376 |
| 39,679 | 37,971 | |
| three-month period ended March 31, | ||
| 2018 | 2017 | |
| Continuing Operations Revenue |
||
| Software and other | 5,699 | 5,652 |
| Professional services | 2,853 | 2,086 |
| Total Revenue | 8,552 | 7,738 |
| Cost of sales | ||
| Software and other | 780 | 956 |
| Professional services | 1,341 | 1,366 |
| Total cost of sales | 2,121 | 2,322 |
| Gross Profit | 6,431 | 5,416 |
| Expenses | ||
| Sales and Marketing | 3,244 | 3,496 |
| General and administration | 2,285 | 2,233 |
| Research and development | 794 | 689 |
| Depreciation, amortization, and foreign exchange | (108) | 117 |
| Transaction | 125 | – |
| 6,340 | 6,535 | |
| Income (loss) before finance income, net and income tax expense | 91 | (1,119) |
| Finance income, net | (17) | (4) |
| Income (Loss) before income tax expense | 108 | (1,115) |
| Income tax expense | 8 | 15 |
| Net income (loss) and comprehensive income (loss) for the period from continuing operations | 100 | (1,130) |
| Discontinued Operations Net income (loss) for the period from discontinued operations | 75 | (4) |
| Net income (loss) and comprehensive income (loss) for the period | 175 | (1,134) |
| Basic and diluted income and comprehensive income per common share | 0.00 | (0.00) |
| Basic and diluted income and comprehensive income per common share from continuing operations | 0.00 | (0.00) |
| Weighted average number of common shares outstanding Basic | 239,473,840 | 238,921,896 |
| Diluted | 247,469,229 | 238,921,896 |