TORONTO, ON / ACCESSWIRE / August 24, 2022 / Route1 Inc . (TSXV:ROI) (the "Company" or "Route1"), an advanced North American provider of turn-key engineering and professional services, today reported its financial results for the three and six-month period ended June 30, 2022.
The Company's operating results for Q2 2022 with comparatives are as follows:
Statement of operations In 000s of CAD dollars | Q2 2022 | Q1 2022 | Q4 2021 | Q3 2021 | Q2 2021 | Q1 2021 | ||||||||||||||||||
Revenue | ||||||||||||||||||||||||
Subscription and services | 1,854 | 1,911 | 1,977 | 2,297 | 2,671 | 2,758 | ||||||||||||||||||
Devices and appliances | 5,251 | 2,781 | 5,022 | 4,960 | 3,663 | 3,786 | ||||||||||||||||||
Other | 9 | 3 | 36 | 31 | 4 | 67 | ||||||||||||||||||
Total revenue | 7,114 | 4,695 | 7,035 | 7,288 | 6,338 | 6,611 | ||||||||||||||||||
Cost of revenue | 5,015 | 2,572 | 4,660 | 4,696 | 3,443 | 3,647 | ||||||||||||||||||
Gross profit | 2,099 | 2,123 | 2,375 | 2,592 | 2,895 | 2,964 | ||||||||||||||||||
Operating expenses | 1,972 | 2,012 | 2,382 | 2,437 | 2,451 | 2,542 | ||||||||||||||||||
Operating profit 1 | 127 | 111 | (7 | ) | 155 | 444 | 422 | |||||||||||||||||
Total other expenses 2 | 183 | 110 | 308 | 216 | (17 | ) | 284 | |||||||||||||||||
Net income (loss) | (56 | ) | 1 | (315 | ) | (61 | ) | 461 | 138 |
1 Before stock-based compensation
2 Includes gain on litigation, gain or loss on asset disposal, stock-based compensation expense, interest expense, income tax recovery, foreign exchange loss or gain, other expenses and acquisition expense.
Subscription and services revenue in 000s of CAD dollars | Q2 2022 | Q1 2022 | Q4 2021 | Q3 2021 | Q2 2021 | Q1 2021 | ||||||||||||||||||
Application software | 1,402 | 1,483 | 1,504 | 1,628 | 1,724 | 1,977 | ||||||||||||||||||
Technology as a service (TaaS) | - | - | 50 | 150 | 435 | 293 | ||||||||||||||||||
Other services | 452 | 428 | 423 | 519 | 512 | 488 | ||||||||||||||||||
Total | 1,854 | 1,911 | 1,977 | 2,297 | 2,671 | 2,758 |
Other services revenue in 000s of CAD dollars | Q2 2022 | Q1 2022 | Q4 2021 | Q3 2021 | Q2 2021 | Q1 2021 | ||||||||||||||||||
Technology life-cycle maintenance and support | 231 | 209 | 175 | 177 | 200 | 195 | ||||||||||||||||||
Professional services | 221 | 219 | 248 | 342 | 312 | 293 | ||||||||||||||||||
Total | 452 | 428 | 423 | 519 | 512 | 488 |
Adjusted EBITDA in 000s of CAD dollars | Q2 2022 | Q1 2022 | Q4 2021 | Q3 2021 | Q2 2021 | Q1 2021 | ||||||||||||||||||
Adjusted EBITDA 3 | 459 | 446 | 341 | 465 | 760 | 764 | ||||||||||||||||||
Amortization | 332 | 335 | 348 | 310 | 316 | 342 | ||||||||||||||||||
Operating profit | 127 | 111 | (7 | ) | 155 | 444 | 422 |
3 Adjusted EBITDA is defined as earnings before interest, income taxes, depreciation and amortization, stock-based compensation, patent litigation, restructuring and other costs. Adjusted EBITDA does not have any standardized meaning prescribed under IFRS and is therefore unlikely to be comparable to similar measures presented by other companies. Adjusted EBITDA allows Route1 to compare its operating performance over time on a consistent basis.
Balance sheet extracts In 000s of CAD dollars | Jun 30 2022 | Mar 31 2022 | Dec 31 2021 | Sep 30 2021 | Jun 30 2021 | Mar 31 2021 | ||||||||||||||||||
Cash | 299 | 481 | 63 | 727 | 166 | 513 | ||||||||||||||||||
Total current assets | 4,593 | 3,618 | 5,726 | 7,543 | 5,008 | 5,357 | ||||||||||||||||||
Total current liabilities | 9,012 | 8,147 | 10,563 | 11,542 | 9,095 | 9,887 | ||||||||||||||||||
Net working capital | (4,419 | ) | (4,529 | ) | (4,837 | ) | (3,999 | ) | (4,087 | ) | (4,530 | ) | ||||||||||||
Total assets | 13,909 | 12,574 | 15,097 | 16,833 | 13,739 | 14,386 | ||||||||||||||||||
Net bank debt and seller notes | 2,515 | 2,297 | 2,926 | 2,194 | 1,673 | 1,215 | ||||||||||||||||||
Total shareholders' equity | 2,883 | 2,774 | 2,728 | 2,982 | 2,906 | 2,443 |
As of August 22, 2022, there are a total of 2,925,000 options currently outstanding under the stock option plan.
Business and Operations Update
in 000s US Dollars | Q1-22 A | Q2-22 A | Q3-22 F | |||||||||
Technology life-cycle maintenance and support | 165 | 182 | 198 |
Since the closing of the Spyrus Solutions acquisition, the Company has monetized the inventory acquired and realized good short-term success in selling the PocketVault P-3X technology. Route1's contributory gross margin decrease in Q2-22 was a direct result of not pre buying components required to manufacture new inventory until sales orders are in hand. It is also worth noting that the Company spent approximately US $580,000 to acquire Spyrus Solutions.
in 000s US Dollars | Q4-21 A | Q1-22 A | Q2-22 A | |||||||||
Spyrus Solutions Contributory Gross Margin | 382 | 302 | 122 |
in 000s US Dollars | Q3-21 A | Q4-21 A | Q1-22 A | Q2-22 A | ||||||||||||
Total Indirect Costs not including Amortization | 2,216 | 2,034 | 1,677 | 1,640 |
Moving Forward
Route1 will continue to pivot the sales model towards its core services and engineering competencies. The Company is emphasizing its turn-key engineering services for clients using video and sensor capture technology to deliver real-time, secure actionable intelligence. Route1 enhances its customers' return on investment by driving outcomes through the application of advanced technological solutions and by leveraging our expertise in video intelligence data.
Further, the Company will continue to invest in data security, user authentication technologies, and develop new technologies that will allow Route1 end-users to integrate disparate data sets and use ALPR technology for new outcomes. For certainty, included in our investment is the Company's flagship software application MobiKEY and service delivery platform DEFIMNET, which separates us from other turn-key engineering services competitors
Route1 currently excels as an engineering and professional services provider for ALPR clients and is seeing growth in the number of accounts, increased investment in the technology once deployed by an account, and strong demand for post-sales support from these accounts. The Company's turn-key engineering and professional services to support Route1 clients are as follows: (a) advisory and analysis including operations assessment, (b) design and engineering, (c) hardware and software procurement, (d) project management, (e) installation and configuration, (f) end user and administrator training, (g) technology life-cycle maintenance and support, (h) operations optimization which is centered around data integration and intelligence.
Route1's focus is on situations in which video and sensor intelligence, and related environmental data can augment an organization's capabilities - whether in the private or public sector. Building on the Company's expertise in the video space, combined with its deep-rooted background in software development, system infrastructure operations and cybersecurity, Route1 has a competitive advantage and is in position to differentiate itself in the engineering and professional services arena.
The subscription-based revenue model for Route1's MobiKEY product was one of the first in the industry. Now, Route1 augments that recurring revenue stream having adopted the model throughout the Company. Unlike traditional turn-key engineering and professional-services organizations, the emphasis is on engaging our customers in a way that creates an on-going interaction and drives long term recurring revenue.
Our investment continues to be in people and relationships with independent software vendors ("ISV") and OEMs to leverage their intellectual property to gain actionable intelligence that generates exceptional outcomes for our clients.
Route1 Inc. is an advanced North American engineering and professional services company using data capture technologies. We bring security and operations together with real-time actionable intelligence to enhance safety and security, drive greater profitability and improve operational efficiencies. With a deep-rooted background in software development, network operations, and cybersecurity, Route1 brings a unique and valuable approach to the turn-key engineering and professional services arena. Route1's services follow a complete life-cycle model, ensuring the evolution of your technology to meet your desired outcomes. Route1 is listed in Canada on the TSX Venture Exchange under the symbol ROI. For more information, visit: www.route1.com .
For More Information, Contact:
Tony Busseri
President and Chief Executive Officer
+1 480 500-7030
[email protected]
This news release, required by applicable Canadian laws, does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.
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 release.
© 2022 Route1 Inc. All rights reserved. No part of this document may be reproduced, transmitted or otherwise used in whole or in part or by any means without prior written consent of Route1 Inc. See https://www.route1.com/terms-of-use/ for notice of Route1's intellectual property.
This news release may contain statements that are not current or historical factual statements that may constitute forward-looking statements or future oriented financial information. These statements are based on certain factors and assumptions, including, expectations regarding the expected growth in the value of support contracts for the LPR business, price and liquidity of the common shares, expected financial performance and subscription-based revenue, business prospects, technological developments, development activities and like matters. While Route1 considers these factors and assumptions to be reasonable, based on information currently available, they may prove to be incorrect. These statements involve risks and uncertainties, including but not limited to the market demand for the Company's products and services and risk factors described in reporting documents filed by the Company. Actual results could differ materially from those projected as a result of these and other risks and should not be relied upon as a prediction of future events. The Company undertakes no obligation to update any forward-looking statement or future oriented financial information to reflect events or circumstances after the date on which such statement is made, or to reflect the occurrence of unanticipated events, except as required by law. Estimates used in this presentation are from Company sources. Past or forecasted performance is not a guarantee of future performance and readers should not rely on historical results or forward-looking statements or future oriented financial information as an assurance of future results.
SOURCE: Route1 Inc.