Technology Holding Company Tiny Reports Full Year 2023 Results, Full Year Revenue Up 21% YoY to $185.5 Million
- Total revenue for Q4 2023 of $51.2 million
- Cash from operations in Q4 2023 of $9.9 million
- Recurring revenue (1) in 2023 was $29.5 million. Recurring revenue does not include the Q1 2023 recurring revenue from WeCommerce of $8.4 million
- Q4 2023 was the first quarter of consolidated results of Clean Canvas, which was acquired by Tiny's subsidiary, WeCommerce at the end of Q3 2023.
Vancouver, BC, April 18, 2024--(T-Net)--Tiny Ltd. (TSXV: TINY) (formerly, WeCommerce Holdings Ltd.), a technology holding company with a strategy of acquiring majority stakes in businesses, has announced the financial results for Tiny Ltd. for the year ended December 31, 2023.
Currency amounts are expressed in Canadian dollars unless otherwise noted.
"This was a landmark year for Tiny. In 2023, we completed the merger with WeCommerce, made substantial efficiency improvements across the organization reducing cost, and ended the year with strong fourth quarter results." said company management in a release.
"With an established foundation of operating businesses and leaders at Tiny, we are excited to continue building and growing this coming year, and more importantly, for the decades to come."
2023 Annual Financial Results
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For the years ended December 31, |
|
|
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2023 |
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2022 |
|
|
|
|
|
|
|
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Revenue |
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185,502,613 |
|
|
153,663,188 |
|
Operating (loss)/income |
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(19,173,692 |
) |
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22,247,031 |
|
Net income |
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14,754,930 |
|
|
5,405,789 |
|
EBITDA (1) |
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46,406,427 |
|
|
20,169,761 |
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EBITDA % (1) |
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25 % |
|
|
13 % |
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Recurring revenue (1) |
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29,514,301 |
|
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8,864,540 |
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Recurring revenue % (1) |
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16 % |
|
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6 % |
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Cash provided by operating activities |
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3,385,040 |
|
|
21,578,854 |
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Basic earnings per share |
|
0.08 |
|
|
0.04 |
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Diluted earnings per share |
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0.08 |
|
|
0.04 |
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(1) Refer to Non-IFRS Measures for further information |
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- Revenue for the year ended December 31, 2023 was $185.5 million, an increase of $31.8 million or 21% compared to prior year. Had the acquisitions of Wecommerce and Clean Canvas occurred on January 1, 2023, management estimates that the acquisitions would have contributed $21.1 million of revenue. On a consolidated basis, revenue would have totaled $206.6 million.
- Recurring revenue(1) in 2023 was $29.5 million and made up 16% of total revenue, an increase from 6% of total revenue in 2022. This was due to the merger with WeCommerce in the Software and Apps segment of which 66% of its revenue is recurring.
- Net income in 2023 was $14.8 million compared to net income of $5.4 million in 2022. The change to net income is due to higher expenses incurred from the merger and slightly offset from higher revenue contributed from the 2023 acquisitions. Had the acquisitions of WeCommerce and Clean Canvas occurred on January 1, 2023, management estimates that the acquisitions would have contributed net loss of $3.0 million. On a consolidated basis, net income would have totaled $11.8 million.
- The Company incurred $11.8 million of one-time costs relating to the merger and subsequent restructuring.
- Unrestricted cash on hand on December 31, 2023 was $26.9 million compared to $31.2 million on December 31, 2022. Total debt outstanding on December 31, 2023 was $131.2 million compared to $69.8 million on December 31, 2022. The increase in debt of $61.4 million is mainly due to the merger with WeCommerce.
- Total assets on December 31, 2023 were $392.6 million compared to $168.7 million on December 31, 2022. Total intangibles and goodwill increased by $89.2 million and $126.4 million, respectively, for the year, as a result of the acquisition of WeCommerce in Q2 and subsequently in Q3, WeCommerce's acquisitions of Clean Canvas and Jagged Pixel. This was offset by impairments and disposals in the year.
- EBITDA in 2023 was $46.4 million compared to $20.2 million in 2022. The increase was a result of the acquisitions made during the year. EBITDA does not include the Q1 2023 EBITDA results from WeCommerce of $0.5 million.
Financial Statements
Tiny Ltd's consolidated financial statements and Management's Discussion and Analysis ("MD&A") for the 2023 year are available on SEDAR+ at https://www.sedarplus.ca/.
About Tiny
Tiny is a Canadian-based investment company focused primarily on acquiring majority stakes in businesses that it expects to hold over the long-term. The Company is structured to give maximum flexibility to operating management teams by maintaining a focus at the parent company level on only three areas: capital allocation, management, and incentives. This structure enables each company to run independently and focus on what they do best, within an incentive structure that is designed to drive results for both the operating business and ultimately for Tiny and its shareholders.
Tiny currently has three principle reporting segments: Digital Services, which provides design, engineering, brand positioning and marketing services to help companies of all sizes deliver premium web and mobile products; Software and Apps, which is home to a complementary portfolio of recurring revenue software businesses that support merchants, as well as digital themes businesses that sell templates to Shopify merchants; and Creative Platform, which is comprised primarily of Dribbble, the social network for designers and digital creatives, as well as a premier online marketplace for digital assets such as fonts and templates.
For more about Tiny, please visit www.tiny.com or refer to the public disclosure documents available under Tiny's SEDAR profile on SEDAR at www.sedar.com.
Additional Details
on Earnings Report
Non-IFRS Financial Measures
This news release makes to reference to certain non-IFRS measures and ratios, hereafter, referred to as "non-IFRS measures". These measures are not recognised measures under IFRS, and do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of the results of operations from management's perspective. Accordingly, these measures should not be considered in isolation nor as a substitute for analysis of the financial information reported under IFRS. The Company uses non-IFRS measures including "EBITDA", "EBITDA %", and "recurring revenue". Management uses these non-IFRS measures to facilitate operating performance comparisons from period to period, to prepare annual operating budgets and forecasts and to determine components of management compensation. As required by Canadian securities laws, the Company defines and reconciles these non-IFRS measures below: [ MORE ]
Non-IFRS Financial Measures
This news release makes to reference to certain non-IFRS measures and ratios, hereafter, referred to as "non-IFRS measures". These measures are not recognised measures under IFRS, and do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of the results of operations from management's perspective. Accordingly, these measures should not be considered in isolation nor as a substitute for analysis of the financial information reported under IFRS. The Company uses non-IFRS measures including "EBITDA", "EBITDA %", and "recurring revenue". Management uses these non-IFRS measures to facilitate operating performance comparisons from period to period, to prepare annual operating budgets and forecasts and to determine components of management compensation. As required by Canadian securities laws, the Company defines and reconciles these non-IFRS measures below:
EBITDA and EBITDA %
EBITDA is defined as earnings (net income or loss) before finance costs, income taxes, depreciation and amortization. EBITDA is reconciled to net income (loss) from the financial statements.
EBITDA % ratio is determined by dividing EBITDA by total revenue for the year.
EBITDA and EBITDA % is frequently used to assess profitability before the impact of finance costs, income taxes, depreciation and amortization. Management uses non-IFRS measures in order to facilitate operating performance comparisons from period to period and to prepare annual operating budgets. EBITDA and EBITDA % are measures commonly reported and widely used as a valuation metric.
Recurring Revenue
Recurring Revenue consists of revenues generated through subscriptions that grant access to products and services with recurring billing cycles. The subscriptions are recognized on an overtime basis in accordance with IFRS 15.
Recurring Revenue is a part of total revenue disclosed in the financial statements, as determined in accordance with IFRS 15.
Recurring Revenue represents revenues that are stable and the Company expects to earn continuously. Recurring Revenue % is determined by dividing Recurring Revenue by total revenue for the year. Recurring Revenue is frequently used to determine any indicators of future revenue growth and revenue trends. Recurring Revenue and Recurring Revenue % are measures commonly reported and widely used as a valuation metric.
NON-IFRS MEASURES RECONCILIATIONS
EBITDA and EBITDA %
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For the years ended December 31, |
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2023 (1) |
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2022 |
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Net income |
$ |
14,754,930 |
|
$ |
5,405,789 |
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Income tax (expense)/recover |
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(4,439,637 |
) |
|
7,578,714 |
|
Depreciation and amortization |
|
27,119,931 |
|
|
4,881,837 |
|
Interest expense |
|
8,971,203 |
|
|
2,303,421 |
|
EBITDA |
|
46,406,427 |
|
|
20,169,761 |
|
Revenue |
|
185,502,613 |
|
|
153,663,188 |
|
EBITDA % |
|
25 % |
|
|
13 % |
|
(1) EBITDA does not include the Q1 2023 EBITDA results from WeCommerce of $0.5 million. |
|
Recurring Revenue
|
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For the years ended December 31, |
|
|
|
2023 |
|
|
2022 |
|
Recurring revenues |
$ |
29,514,301 |
|
$ |
8,864,540 |
|
Non-recurring revenues |
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155,988,312 |
|
|
144,798,648 |
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Total revenue |
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185,502,613 |
|
|
153,663,188 |
|
|
|
|
|
|
|
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Recurring revenue % of total revenue |
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16 % |
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6 % |
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Cautionary Note Regarding Forward-Looking Information
This press release contains statements which constitute "forward-looking statements" and "forward-looking information" within the meaning of applicable securities laws (collectively, "forward-looking statements"), including statements regarding the plans, intentions, beliefs and current expectations of the Company with respect to future business activities and operating performance.
Forward-looking statements are often identified by the words "may", "would", "could", "should", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect" or similar expressions and forward-looking statements in this press release includes, but is not limited to information and statements regarding the business objectives and plans of the combined entity.
Investors are cautioned that forward-looking statements are not based on historical facts, but instead reflect the Company's expectations, estimates or projections concerning future results or events based on the opinions, assumptions and estimates of management considered reasonable at the date the statements are made. [ MORE ]
Cautionary Note Regarding Forward-Looking Information
This press release contains statements which constitute "forward-looking statements" and "forward-looking information" within the meaning of applicable securities laws (collectively, "forward-looking statements"), including statements regarding the plans, intentions, beliefs and current expectations of the Company with respect to future business activities and operating performance.
Forward-looking statements are often identified by the words "may", "would", "could", "should", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect" or similar expressions and forward-looking statements in this press release includes, but is not limited to information and statements regarding the business objectives and plans of the combined entity.
Investors are cautioned that forward-looking statements are not based on historical facts, but instead reflect the Company's expectations, estimates or projections concerning future results or events based on the opinions, assumptions and estimates of management considered reasonable at the date the statements are made.
Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, such statements involve risks and uncertainties, and undue reliance should not be placed thereon, as unknown or unpredictable factors could have material adverse effects on future results, performance or achievements of the Company.
Among the key factors that could cause actual results to differ materially from those projected in the forward-looking statements are the following: credit, liquidity and additional financing risks for the Company and its investees; stock market volatility; changes in e-commerce industry growth and trends; changes in the business activities, focus and plans of the Company and its investees and the timing associated therewith; the Company's actual financial results and ability to manage its cash resources; changes in general economic, business and political conditions, including challenging global financial conditions, as a result of the COVID-19 pandemic or otherwise; competition risks; potential conflicts of interest; changes in applicable laws and regulations both locally and in foreign jurisdictions; compliance with extensive government regulation; the risks and uncertainties associated with foreign markets; and the other risk factors more fully described under the heading "Risks Related to the Operations of Tiny and the Resulting Issuer" in the Circular and under the heading "Risk Factors" in each of Company's most recent annual information form and management's discussion and analysis, each of which is available on the Company's SEDAR profile at www.sedar.com.
Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although the Company has attempted to identify important risks, uncertainties and factors which could cause actual results to differ materially, there may be others that cause results not to be as anticipated, estimated or intended and such changes could be material. The Company does not intend, and does not assume any obligation, to update the forward-looking statements except as otherwise required by applicable law.
Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.
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