Spotlio AS (SPOT) Earnings Call Transcript & Summary

Hello, and welcome to Canopy Holdings 2022, '23 quarter 1 presentation. I'm Christian Erlandson, your new CEO, Canopy Holdings. I joined the company only a couple of months ago and previously have been running profitable, purpose-driven businesses in the Software-as-a-Service sector for more than 20 years. And also joining me today is Ivar, our CFO. He will be taking through our financials and our KPIs. So stay tuned. We will start with our usual agenda with the Q1 highlights and then leading on to the financials and KPIs. And after that, we will take your questions. So those of you that are new to Canopy Holdings, what we have created is really a platform of services to help resorts, attractions, to increase revenue, reduce costs and improve the customer journeys through digitization of key processes. We're early on in this journey. This is a big market. So we have a lot of runway to go. In our Q1 highlights, I'd like to first start off by talking about our continued growth. We have delivered over NOK 13.4 million in revenue. That is a 59% year-over-year growth rate, very impressive. A lot of this growth has been generated by taking essentially existing products from the ski markets and moving that and selling that into the parks and attractions business, and we're beginning to see the revenue opportunity come through from deals that were closed earlier. Also, strong customer acquisition, right? We have over 141 customers, actually 242 if you add August. And what I've seen in my short time, which is encouraging is some cross-selling activity. So essentially, customers that were taking a product from one business, looking to expand the portfolio and look at all the product suite that Canopy offerings has to offer. We also in -- as I've only been with the company for a couple of months, I've had the opportunity to further my knowledge of the business begin to really understand the team, what makes Canopy holding successful. And I have to say we have a great team. We've got to create tech stack, a great SaaS product offering that when you look underneath the bonnet, there's a lot there, but it's -- I think we can do better. And so early on, I have decided to take a strategic review of this business because I think we can find ways to unlock additional growth, additional profits and build a more sustainable business going forward. The other highlight that I'd like to talk to you about today is a recent development that is Evan Reece, our CEO and Founder of Liftopia has decided to move on, and I wish Evan all the best in his future endeavors. I have appointed Matt Cohen, our interim CEO of the Catalate business. Now Matt has been with Evan almost from the beginning with Liftopia. So I have all the confidence in the world that Matt will be successful in continuing to drive the Catalate business. So with that, I'd now like to hand over to Ivar who will take you through the financials. Ivar?

Thank you, Christian. I will start with the P&L. And as was highlighted by Christian, we had a very strong revenue growth in this quarter compared to same quarter last year and are very happy about that. And that was also, as alluded by Christian, driven by the B2B transactional revenues, which you can see in the pie chart here was NOK 8.5 million in the quarter. That translates into a growth of 60% from last -- from the quarter last year. The underlying real growth is, however, impacted by weakening NOK this year compared to last year. So the U.S. dollar growth in this revenue was 41%. We also recognized the deferred revenues from past years gift card sales also this quarter of some NOK 2 million. So that but also made the other revenues in the pie chart grow compared to last year. And the B2B SaaS revenue was quite flat year-over-year. The weakening of NOK also impacts growth in our costs, as I explained some had growth. We also had a noncash cost related to the option program, which quarter was what was quite much higher than last year. And we also spent coming out of pandemic, we spent more on travel and also spent quite much more on R&D. So in -- together with weakening of NOK, that explains most of the increase to the other OpEx you see here. We have lower depreciation than last year, and that's a result of an impairment charge due to goodwill in Q4. And all in all, we had a net loss of some NOK 25 million, which is NOK 3 million lower than same quarter last year. And then I will go over to the balance sheet. I will not go into any details here, but you see the cash position here of NOK 51 million, which is some NOK 26 million lower than Q4. And I want to go into a cash flow statement in the next slide. But here, I just want to point out the reduction to total current liabilities, which, of course, impacts were a negative cash flow with increased working capital. So here, you can see that the increased working capital was approximately NOK 7 million. And in addition to EBITDA, also NOK 16 million negative adjusted for share-based compensation costs resulted in a negative rational cash flow also NOK 24 million. We capitalized a little bit less in R&D this quarter when comparables for last year. And all in all, this translates into a negative cash flow of NOK 26 million for the quarter. And then I will just do a quick update on the KPIs with the August numbers, which we have added after we released the July KPIs some month ago. And in August, we added one more resort in the transactional segment and we increased the total ARR by some EUR 60,000. And all in all, from August last year, we have grown a number of total research by 9% and total ARR by 13%. And here, I will show you the breakout of the ARR into the vertical segments, ski resorts and products and attractions. And we have been showing this for some quarters now, and we have shown growth in the parks and attractions segments throughout last autumn and earlier last winter. And now we can see that translate into actual revenue growth. So the transaction of business is seasonal. So a growth in ARR numbers might be delayed before we see the actual growth translating into revenues. So that's kind of how the business is. So this was a very quick run through, and we can move over to Q&A.

So the first question is, do we plan to raise money when looking at the losses in the business and the current cash flow? Quick answer to that is, yes. We will plan on raising money, but not without me undergoing the strategic review. And this is something I'll come back to you in December and report on. But looking at some of the assets and how they're performing, we already have one of the businesses that is forecasting by this time next year will be cash flow EBITDA positive. So there is some encouragement there. So I do see the opportunity to kind of optimize the business and find a way to come -- deliver profitability sooner, but it will take capital to do that, and we will need to raise money in the future.

Okay. There's another question here.

Yes. how about the pipeline, how the pipeline looks towards the winter. I'd say the pipeline when coming with the ski resorts, all that activity is actually driven now, trying to convert deals and go live before the season starts. Catalate has developed a very healthy pipeline, and we're looking to close as many opportunities and convert them to close as soon as possible.