TrackX Reports a 324% Year-Over-Year Revenue Increase in Nine-Month Period, CEO Provides Update on Operations
DENVER — August 30, 2017— TrackX Holdings Inc. (TSX.V:TKX) (“TrackX” or the “Company”), an enterprise IIoT software platform provider for the management of physical assets, announces the financial and operational highlights from its third quarter ended June 30, 2017, and provides an update on its ongoing operations. All results are reported in Canadian dollars unless otherwise specified. A complete set of the June 30, 2017 Consolidated Financial Statements and Management’s Discussion & Analysis have been filed on SEDAR (www.sedar.com).
Financial Highlights
- Revenues for the nine months ended June 30, 2017 were $3,839,024, a 324% increase over the $904,816 reported for the nine months ended June 30,016.
- Revenues for the three months ended June 30, 2017 were $878,331, a 167% increase over the $328,438 reported for the three months ended June 30, 2016.
- Gross profit for the three months ended June 30, 2017 was $286,150, representing 32.6% of revenues versus ($55,436) for the comparable three-month period ending June 30, 2016.
- Adjusted EBITDA loss for the three months ended June 30, 2017 was ($1,070,487) compared to a loss of ($980,533) for the prior year’s comparable period.
- Recurring software revenue increased 118% in 2017 over the same nine-month period ended June 30, 2016.
- Cash at the end of the period was $2.3 million.
“The key achievement in the quarter was closing our oversubscribed $5.2 million bought deal financing in May and using some of those proceeds to close our acquisition of broTECH Solutions in June,” said President and CEO Tim Harvie. “Since then, we’ve commenced consolidating resources, establishing cost controls, creating strategies to leverage our enhanced partnerships, expanding our engineering and development capacity, and evolving our product and implementation support. We can now shift more focus to the growth of our sales organization and the continued expansion of our partner network to support our combined pipeline.”
Selected Financial Information
| (Canadian dollars – in thousands except per share) | Nine-month Period Ended June 30, | Three-month Period Ended June 30 | ||
| 2017 | 2016 | 2017 | 2016 | |
| $ | $ | $ | $ | |
| Revenue | 3,839 | 905 | 878 | 328 |
| Gross Margin | 1,190 | (247) | 286 | (55) |
| Loss for the period | (2,685) | (3,380) | (1,090) | (2,485) |
| Loss per share | (0.05) | (0.26) | (0.02) | (0.10) |
| Adjusted EBITDA (Loss)* | (2,378) | (1,762) | (1,070) | (981) |
| * Adjusted EBITDA is a non-IFRS (international financial reporting standards) measure and excludes stock based compensation | ||||
Q2 2017 and Subsequent Period Operational Highlights:
- Completed Phase I deployment of Global Asset Management for Enterprises (GAME) at all current 26 locations for a large online used automobile retail customer.
- Closed a $5.2 million bought deal financing led by Haywood Securities Inc. and included Canaccord Genuity Corp. and Paradigm Capital Inc.
- Completed the accretive acquisition of broTECH Solutions.
- The merged company has combined resources to gain efficiencies, eliminating several redundant or overlapping responsibilities. The net result is an annual reduction of approximately $1,000,000 in operating costs of the combined companies.
- The combined TrackX now has approximately 50 individuals in engineering, implementation, support and services. These individuals are located in India and Riverside, California. Other employees and key executives in sales, administration, accounting, and leadership are located at TrackX’s Denver, CO head office and in Vancouver, BC.
- New broTECH-developed technology platform extensions and features, including Android and iOS mobile apps, are now integrated into TrackX’s GAME platform.
- Immediate sales pipeline opportunities include additional distribution yard and dock deployments, returnable transport item management, inventory management and high value asset management for both new and existing customers. The beverage, brewery, horticultural, retail and cannabis verticals are also presenting new revenue opportunities.
Integration of broTECH Team
- During the quarter, broTECH’s Chris Brumett and Kiruba Raja, were appointed TrackX’s Chief Technology Officer and Senior VP of Industrial Internet of Things, respectively, and have assumed all engineering leadership.
- TrackX continues to transition accounts from broTECH and is also in discussions with key broTECH integration partners and customers to expand the capabilities and deliverables around current and future installations.
The Enhanced TrackX GAME Platform
With the integration of the broTECH iOS and Android mobility extensions and enhancements to TrackX’s GAME platform, TrackX expands its product offering and strengthens its competitive differentiation in current and future customer deployments.
For example:
- Mobility Enhancements: Newly integrated smart phone solutions can significantly reduce hardware costs and increase carrier and dedicated fleet monitoring in a yard environment. These enhancements further increase the customer’s return on investment (ROI) via hardware cost reductions, more capability, and impacting more business processes within the customer’s operational footprint.
- Yard Management: Strong enhancements in dock management, a core strength of broTECH, will result in additional revenue opportunities within existing customers. This further establishes TrackX’s leadership position in the delivery of supply chain solutions to large retail, consumer packaged goods (CPG), manufacturing, beverage, and transportation customers.
- Brewery Supply Chain: New mobile apps used across the brewer, distributor and retailer give brewers visibility across the entire supply chain to track beer kegs and other products from the point of sale to the distributors, and to the end retailer and back.
About TrackX
TrackX, based in Denver, Colorado, is an enterprise Industrial Internet of Things (IIoT) software platform provider leveraging multiple auto-ID technologies for the comprehensive management of physical assets. TrackX’s Global Asset Management for the Enterprise (GAME) enables the IIoT by providing unique item level tracking, workflow processing, event management, alerts and powerful analytics to deliver solutions across a growing number of industries. This platform creates unprecedented visibility and business intelligence of man-to-machine and machine-to-machine interaction. TrackX delivers significant value to a growing list of Fortune 500 companies and for customers in industries such as transportation, beverage, brewery, healthcare, hi-tech, hospitality, mining, agriculture, horticulture, manufacturing and government.
For more information, please contact:
Knox Henderson, TrackX Holdings Inc.
778-373-2003
Sean Peasgood, Sophic Capital
416-565-2805
Neither TSX Venture Exchange nor its Regulations 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.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION: This news release includes certain “forward-looking statements” under applicable Canadian securities legislation. Forward looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. All statements that address future plans, activities, events or developments that the Company believes, expects or anticipates will or may occur including the Company’s anticipated pipeline and value of current and customer deployments and future opportunities are the managements best estimates and cannot be guaranteed or relied upon and is forward-looking information. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. The Company disclaims any intention or obligation to update or revise any forward-looking statements in this news release, whether as a result of new information, future events or otherwise, except as required by law.