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EIGHTH CONSECUTIVE QUARTERLY POSITIVE NORMALIZED EBITDA
Toronto, Ontario--(Newsfile Corp. - August 28, 2024) - YANGAROO Inc. (TSXV: YOO) (OTC Pink: YOOIF) ("Yangaroo", "Company"), a software leader in media asset workflow and distribution solutions, today announced its financial results for the second quarter ended June 30, 2024. The second quarter financial statements and corresponding management's discussion and analysis (the "Second Quarter Filings") are available at www.yangaroo.com and at www.sedarplus.ca. Please note that all currency in this press release is denominated in United States dollars, unless otherwise noted.
We are pleased to report significant advancements in the second quarter of 2024. Despite a decline in sales volume and revenue, after adjusting for seasonality, our operating income has shown considerable improvement compared to the previous year. Net cash flow from operating activities more than tripled, reaching $525,087 in the first six months of 2024, compared to the operating cash flow of $145,446 during the same period last year. This growth is primarily due to increased operating income as management continues to navigate a challenging environment and improve operational efficiency.
For the three months ended June 30, 2024, operating income increased to $110,704 and normalized EBITDA increased to $337,816, up from $17,371 and $237,583, respectively, in Q1'2024. This improvement is largely attributed to reduced costs in headcount, marketing, and technology, though it was offset by higher general and administrative expenses.
The Advertising Division maintained consistent delivery volumes and sales per customer, with the exception of a decline in advertising delivery from one major direct brand client compared to their prior year's ad delivery volume, offset by new accounts and additional revenue from the Millenia3 acquisition. This major direct brand is a seasonal advertiser, primarily active in the first half of the year, so the impact on the second half of the year is expected to be minimal. The Music Division's revenue remained flat year-over-year, and is continuing to develop the North American market through an increase in social media marketing along with conference exhibition and attendance. The Awards Division saw a slight decline in revenue compared to the same period last year which is primarily due to the timing of each award show only. The Awards Division has also now added an additional Award Show contract in its roster, which is to be completed later this year.
Grant Schuetrumpf, CEO of Yangaroo, commented, "We're excited to mark our eighth consecutive quarter of positive Normalized EBITDA, a clear result of our relentless focus on stabilizing operations while delivering top-tier service to our clients. Strengthening our balance sheet remains a priority, and we're continuing to drive deleveraging through strong operating cash flow. As we head into the second half of 2024, we remain laser-focused on executing our growth strategy by expanding our customer base, and continual investment in our technology platform."
Q2'2024 Financial Highlights
Q2'2024 revenue decreased by $222,804 or 10% versus Q2'2023. The decrease in revenue was primarily due to lower Advertising revenue and Award with a decrease of $188,844 or 12% and $29,752 or 11%, respectively. The decrease in Advertising revenue is due to a decline in advertising delivery from one client compared to the previous year, offset by business growth from Millenia3 acquisition and the decrease in Award revenue is due to project delay to the second half of the year.
Q2'2024 operating expenses decreased by $50,895 or 3% versus Q2'2023. The decrease in operating expenses is primarily attributed to lower marketing and headcount expenses, offset by higher general & administrative and technology expenses.
First Six-Month of 2024 Financial Highlights
Revenue in the first six months of 2024 was $3,872,319 compared to $4,017,658 in the first half of 2023.
Revenue decreased by $145,339 or 4% in the first six months of 2024, compared to the same period of 2023. The decrease in revenue is primarily attributed to lower Advertising revenue of $98,780 or 3% as well as decreased Awards revenue of $59,038 or 14%, offset by higher Music revenue with an increase of $12,479 or 2%.
Operating expenses in the first six months of 2024 were $3,744,244 compared to $3,989,855 in the first half of 2023, respectively.
Operating expenses decreased by $245,611 or 6% in the first six months of 2024, compared to the same period of 2023. The decrease in operating expenses is primarily attributed to headcount expense, offset by increased marketing, general & administrative and technology expenses.
Normalized EBITDA in the first six months of 2024 was $575,399 in comparison to normalized EBITDA of $685,332 in the first half of 2023.
Normalized EBITDA decreased by $82,933 in the first six months of 2024, compared to the same period of 2023. The decrease is primarily attributed to lower revenue from Advertising and Award, offset by lower operating expenses from headcount expenses.
The Company generated positive operating cash flow of $525,087 in the first six months of 2024 versus operating cash flow of $145,446 in the same period of 2023, and reduced term loan principal by $258,065 in the first six months of 2024 versus nil repayment in the same period of 2023.
Financial Highlights
| Q2 2024 | Q1 2024 | Q4 2023 | Q3 2023 | |||||||||
| Cash | $ | 86,118 | $ | 207,998 | $ | 150,928 | $ | 254,720 | ||||
| Working capital (deficiency) | ($1,932,157 | ) | ($1,810,041 | ) | ($1,758,949 | ) | ($1,115,884 | ) | ||||
| Liquidity | $ | 378,358 | $ | 521,092 | $ | 623,506 | $ | 975,794 | ||||
| Revenue | $ | 1,949,689 | $ | 1,922,631 | $ | 2,128,768 | $ | 1,708,931 | ||||
| Operating expenses | $ | 1,836,976 | $ | 1,905,259 | $ | 2,172,208 | $ | 1,696,777 | ||||
| Other expenses (income) | $ | 118,863 | ($144 | ) | $ | 3,756,134 | $ | 20,217 | ||||
| Income (loss) for the period | ($129,031 | ) | $ | 15,565 | ($3,799,574 | ) | ($8,063 | ) | ||||
| Income (loss) per share - basic | ($0.00 | ) | $ | 0.00 | ($0.06 | ) | ($0.00 | ) | ||||
| Income (loss) per share - diluted | ($0.00 | ) | $ | 0.00 | ($0.06 | ) | ($0.00 | ) | ||||
| EBITDA | $ | 307,728 | $ | 356,704 | ($3,407,954 | ) | $ | 322,585 | ||||
| EBITDA Margin % | 15.78% | 18.55% | (160%) | 18.88% | ||||||||
| Normalized EBITDA (loss) * | $ | 337,816 | $ | 237,583 | $ | 211,061 | $ | 266,269 | ||||
| Normalized EBITDA Margin % * | 17.33% | 12.36% | 9.91% | 15.58% |
* A non-IFRS measure. See "Non-IFRS financial measures" for definitions and reconciliation non-IFRS measures to the relevant IFRS measures
| Q2 2023 | Q1 2023 | Q4 2022 | Q3 2022 | |||||||||
| Cash | $ | 284,178 | $ | 204,604 | $ | 296,748 | $ | 346,744 | ||||
| Working capital | ($94,749 | ) | ($224,819 | ) | $ | 217,710 | ($1,701,222 | ) | ||||
| Liquidity | $ | 552,960 | $ | 781,378 | $ | 737,680 | $ | 639,320 | ||||
| Revenue | $ | 2,172,493 | $ | 1,845,165 | $ | 2,097,353 | $ | 1,733,140 | ||||
| Operating expenses | $ | 2,103,819 | $ | 2,099,975 | $ | 1,426,921 | $ | 1,987,591 | ||||
| Other expenses (income) | $ | 229,689 | $ | 110,528 | $ | 148,124 | ($109,995 | ) | ||||
| Income (loss) for the period | $ | 37,174 | ($365,487 | ) | $ | 522,308 | ($144,456 | ) | ||||
| Income (loss) per share - basic | $ | 0.00 | ($0.01 | ) | $ | 0.01 | ($0.00 | ) | ||||
| Income (loss) per share - diluted | $ | 0.00 | ($0.01 | ) | $ | 0.01 | ($0.00 | ) | ||||
| EBITDA | $ | 385,449 | ($14,041 | ) | $ | 816,075 | $ | 108,087 | ||||
| EBITDA Margin % | 17.74% | (0.71%) | 38.91% | 6.24% | ||||||||
| Normalized EBITDA (loss) * | $ | 542,129 | $ | 116,203 | $ | 833,974 | $ | 1,927 | ||||
| Normalized EBITDA Margin % * | 24.95% | 6.30% | 39.76% | 0.11% |
* A non-IFRS measure. See "Non-IFRS financial measures" for definitions and reconciliation non-IFRS measures to the relevant IFRS measures
About YANGAROO
Yangaroo is a technology provider in the media and entertainment industry, offering a cloud-based software platform for the management and distribution of digital media content. Yangaroo's Digital Media Distribution System ("DMDS") platform is a patented cloud-based platform that provides customers with a centralised and fully integrated workflow directly connecting radio and television broadcasters, digital display networks, and video publishers for centralised digital asset management, delivery and promotion. DMDS is used across the advertising, music, and entertainment awards show markets.
YANGAROO Inc. is a publicly listed company incorporated on July 28, 1999 under the laws of Ontario as Musicrypt.com Inc. and changed to its present name on July 17, 2007. YANGAROO trades on the TSX Venture Exchange ("TSX-V") under the symbol YOO and in the U.S. under OTCPK: YOOIF.
The address of the Company's corporate office and principal place of business is 360 Dufferin Street, Suite 203, Toronto, Ontario, M6K 3G1.
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For YANGAROO Investor Inquiries:Grant Schuetrumpf Ph: (416) 534 0607 investors@yangaroo.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 accuracy of this release.
Use of Non-IFRS Financial Measures
The following non-IFRS definitions are used in the press release because management believes that they provide useful information regarding the Company's ongoing operations. Readers are cautioned that the definitions are not recognized measures under IFRS, do not have standardized meanings prescribed by IFRS, and should not be construed to be alternatives to revenues and net earnings determined in accordance with IFRS or as an indicator of performance, liquidity or cash flows. The Company's method of calculating these measures may differ from the methods used by other entities and accordingly, these measures may not be comparable to similarly titled measures used by other entities or in other jurisdictions.
EBITDA as defined by the Company means Earnings Before Interest and financing costs (net of interest income), Income Taxes, Depreciation and Amortization. EBITDA is derived from the statements of comprehensive income (loss) and can be computed as revenues less salaries and consulting expenses and property, technology, marketing, administration expenses and any non-recurring items.
Normalized EBITDA as defined by the Company means EBTIDA adjusted for one-time non-recurring items or non-cash item such as stock-based compensation expenses, foreign-exchange expenses, and gain on revaluation of contingent consideration.
EBITDA Margin and Normalized EBITDA Margin as defined by the Company means EBITDA and Normalized EBITDA, respectively, as a percentage of revenue.
Working capital as defined by the Company means current assets less current liabilities.
Liquidity as defined by the Company means cash plus available capacity in the Company's revolving credit facility.
The Company believes EBITDA, EBITDA margin, liquidity, and working capital, are useful measures because they provide information to both management and investors with respect to the operating and financial performance of the Company.
Cautionary Note Regarding Forward-looking Statements
This news release contains certain forward-looking statements and forward-looking information (collectively referred to herein as "forward-looking statements") within the meaning of applicable Canadian securities laws. All statements other than statements of present or historical fact are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "anticipate", "achieve", "could", "believe", "plan", "intend", "objective", "continuous", "ongoing", "estimate", "outlook", "expect", "may", "will", "project", "should" or similar words, including negatives thereof, suggesting future outcomes.
Forward looking statements are subject to both known and unknown risks, uncertainties and other factors, many of which are beyond the control of YANGAROO, that may cause the actual results, level of activity, performance or achievements of YANGAROO to be materially different from those expressed or implied by such forward looking statements, including but not limited to: management's business strategy for 2024; the revocation of the FFCTO; and the filing of the reinstatement application to the TSXV. Although YANGAROO has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended.
Forward-looking statements are not a guarantee of future performance and involve a number of risks and uncertainties, some of which are described herein. Such forward-looking statements necessarily involve known and unknown risks and uncertainties, which may cause YANGAROO's actual performance and results to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. Any forward-looking statements are made as of the date hereof and, except as required by law, neither YANGAROO assumes no obligation to publicly update or revise such statements to reflect new information, subsequent or otherwise.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/221453
SOURCE Yangaroo Inc.
