- Mr. Vineet Khosla, AI and Machine Learning Pioneer, joins the Board of Directors
TORONTO, Aug. 9, 2024 /PRNewswire/ - Quarterhill Inc. ("Quarterhill" or the "Company") (TSX: QTRH) (OTCQX: QTRHF), a leading provider of tolling and enforcement solutions in the Intelligent Transportation System ("ITS") industry, announces its financial results for the three and six months ended June 30, 2024. All financial information in this press release is reported in United States ("US") dollars, unless otherwise indicated.
Quarterhill has changed the presentation currency of its financial statements to US dollars, its functional currency. A significant proportion of the Company's sales, expenses, assets, and liabilities are denominated in US dollars. This change in presentation currency aims to enhance external stakeholders' ability to assess Quarterhill's financial performance and to reduce the impact of foreign exchange volatility.
Q2 2024 Highlights
- Revenue was $41.5 million, up 7.5% compared to $38.6 million in Q2 2023.
- Adjusted EBITDA1 was $1.7 million compared to $2.9 million in Q2 2023.
- Cash from operations was $0.8 million compared to cash used in operations of ($10.3) million in Q2 2023.
- Revenue backlog3 was $500 million at June 30, 2024.
- Completed acquisition of Red Fox I.D. Limited ("Red Fox"), expanding the Company's software offerings.
- Red Fox won two prestigious King's Awards: one for innovation and one for excellence in international trade.
"Q2 saw continued execution on our goals to drive top-line growth, expand Adjusted EBITDA margin and improve cash flow," said Chuck Myers, CEO at Quarterhill. "Adjusted EBITDA margin grew sequentially from Q1, and we anticipate continued progress in growing our margin throughout the year. Additionally, we generated positive cash flow from operations for the first time in two years and expect our cash balance to grow through the end of the year."
"Our two business units - tolling and enforcement - made progress in Q2 on their ongoing projects as well as closing new business, resulting in a contracted revenue backlog of $500 million at quarter end. We remain focused on leveraging the improvements we've made in the past year to our project management and contract bidding processes to grow these leading businesses. At the same time, we continue to work to increase our market reach through operational integration, exploring new opportunities in Europe, penetrating the logistics sector and building-out our suite of software solutions, in particular with artificial intelligence (AI) applications."
Board of Directors Update
Quarterhill announces that Vineet Khosla, Chief Technology Officer at the Washington Post, has joined the Board of Directors, effective immediately. Mr. Khosla has an extensive track record as an innovator and executive at some of the world's largest technology companies. A pioneering researcher and leading voice in AI, machine learning, and cloud computing, he has driven significant advancements in these fields.
Since joining the Washington Post in 2023, Mr. Khosla has led the engineering team, executing the next phase of the company's innovation strategy. Prior to the Post, Vineet served as Senior Engineering Manager at Uber, where he was responsible for the development of their map routing engine, which optimizes routes and timing. Before his tenure at Uber, he was the first engineering hire for Siri's natural language engine at Apple, where he spent over eight years in senior engineering roles, developing and managing Siri's AI engine. Mr. Khosla holds a Master's in AI from the University of Georgia, earned in 2005.
"We are very pleased to welcome Vineet to the Board," said Rusty Lewis, Chair of the Board at Quarterhill. "His deep expertise in AI and machine learning, combined with his experience at the intersection of transportation and technology, will play a key role in the development of our product roadmap and our push to expand the software side of our business."
Q2 2024 Financial Review
Quarterhill's Management's Discussion and Analysis and financial statements for the three and six months ended June 30, 2024 are available at the Company's website and at its profile at SEDAR+.
Financial statements for the three and six months ended June 30, 2023, have been prepared to reflect continuing operations, and therefore, exclude results during that period from Wi-LAN Inc. ("WiLAN"), which was sold by Quarterhill on June 15, 2023.
Revenues for the three and six months ended June 30, 2024, were $41.5 million and $76.4 million, up 7.5% and 14%, respectively, compared to $38.6 million and $67.0 million in the three and six months ended June 30, 2023. The increase in revenues was due to increased activity and improved performance with North American project revenue.
Gross profit2 as a value and as a percentage of revenues may be subject to significant variance in each reporting period due to the nature and type of contract and service work performed. Gross profit for the three and six months ended June 30, 2024, was $8.5 million and $14.9 million, or 21% and 19%, as compared to $10.0 million and $13.8 million, or 26% and 21%, in the three and six months ended June 30, 2023. While gross profit margin percentage has increased on a sequential quarterly basis, the year-over-year decreases compared to the prior year periods were primarily due to one tolling project that is in the maintenance phase but experiencing a transitory period of lower-than-expected margin. The year-over-year decreases in gross profit margin were partially offset by continued strong performance in the Company's enforcement operations.
Total operating expenses are comprised of selling, general and administrative costs ("SG&A"), research and development ("R&D") costs, depreciation, amortization of intangible assets and other charges. Total operating expenses for the three and six months ended June 30, 2024, were $10.8 million and $21.2 million compared to $10.6 million and $22.2 million in the three and six months ended June 30, 2023. The year-over-year changes were primarily due to lower R&D expenses and other charges offset by higher SG&A.
Adjusted EBITDA1 for the three and six months ended June 30, 2024, was $1.7 million and $1.8 million compared to $2.9 million and ($0.9) million for the three and six months ended June 30, 2023. The decrease in Adjusted EBITDA for the three months ended June 30, 2024, compared to the prior year period, was due to lower gross profit as previously explained, and offset, in part, by increased revenue and lower operating expenses. This increase in Adjusted EBITDA for the six months ended June 30, 2024, compared to the prior year period, was due to higher revenue and lower operating expenses.
Net loss from continuing operations for the three and six months ended June 30, 2024, was ($3.0) million and ($7.2) million, or ($0.03) and ($0.06) per diluted share, compared to a net loss from continuing operations of ($10.2) million and ($19.3) million, or ($0.09) and ($0.17) per diluted share, for the three and six months ended June 30, 2023.
Cash generated (used) in continuing operations for the three and six months ended June 30, 2024, was $0.8 million and ($9.3) million compared to cash used in continuing operations of ($6.9) million and ($13.5) million for the three and six months ended June 30, 2023.
Cash and cash equivalents were $24.0 million at June 30, 2024, compared to $42.7 million at December 31, 2023. The uses of cash in the three months ended June 30, 2024, included a net amount of $4.9 million spent on the acquisition of Red Fox.
Adjusted Working Capital4 was $68.4 million at June 30, 2024, compared to $78.9 million at December 31, 2023. Due to the nature of the Company's business activities, operating cash flows may vary significantly between periods due to changes and timing in working capital balances.
1. | Please refer to the Adjusted EBITDA Non-IFRS Financial Measures section for further information. |
2. | Please refer to Gross Margin % in the Supplementary Financial Measures section for further information. |
3. | Please refer to the Backlog - Non-IFRS Financial Measures section for further information. |
4. | Please refer to the Adjusted Working Capital - Non-IFRS Financial Measures section for further information. |
Conference Call and Webcast
Quarterhill will host a conference call to discuss its financial results on Friday, August 9, 2024, at 10:00 AM Eastern Time.
Webcast Information
- Live audio webcast will be available at: https://app.webinar.net/E0GnDAr2wRQ
- Webcast replay will be available at: https://app.webinar.net/E0GnDAr2wRQ
Traditional Dial-in Information
- To access the call from the U.S. and Canada, dial 1.800.836.8184 (Toll Free)
- To access the call from other locations, dial 1.289.819.1350 (International)
Rapidconnect
To instantly join the conference call by phone, please use the following URL to easily register and be connected into the conference call automatically: https://emportal.ink/4cZxWpC
Telephone Replay
Telephone replay will be available from August 9, 2024, until August 16, 2024, at: 1.888.660.6345 (Toll Free North America) or 1.289.819.1450.
Conference ID: 52352 and Replay Passcode: 52352#
Non-IFRS Financial Measures and Non-IFRS Ratios
Quarterhill uses both IFRS and certain non-IFRS financial measures to assess performance. Non-IFRS financial measures are financial measures disclosed by a company that (a) depict historical or expected future financial performance, financial position or cash flow of a company, (b) with respect to their composition, exclude amounts that are included in, or include amounts that are excluded from the composition of the most directly comparable financial measure disclosed in the primary financial statements of the company, (c) are not disclosed in the financial statements of the company and (d) are not a ratio, fraction, percentage or similar representation. Non-IFRS ratios are financial measures disclosed by a company that are in the form of a ratio, fraction, percentage or similar representation that has a non-IFRS financial measure as one or more of its components, and that are not disclosed in the financial statements of the company.
These non-IFRS financial measures and non-IFRS ratios are not standardized financial measures under IFRS, and, therefore, are unlikely to be comparable to similar financial measures presented by other companies. Management believes these non-IFRS financial measures and non-IFRS ratios provide transparent and useful supplemental information to help investors evaluate our financial performance, financial condition, and liquidity using the same measures as management. These non-IFRS financial measures and non-IFRS ratios should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with IFRS.
Adjusted EBITDA - Non-IFRS Financial Measures
We use the non-IFRS financial measure "Adjusted EBITDA" to mean net (loss) income adjusted for (i) income taxes, (ii) finance expense or income; (iii) amortization and impairment of intangibles; (iv) other charges and other one-time items; (v) depreciation of right-of-use assets and property, plant and equipment; (vi) stock- based compensation; (vii) foreign exchange (gain) loss; and (viii) other income which includes equity in earnings from joint ventures; (ix) dividends received from joint ventures; and * changes in fair value of derivative liability. Adjusted EBITDA is used by our management to assess our normalized cash generated on a consolidated basis. Adjusted EBITDA is also a performance measure that may be used by investors to analyze the cash generated by Quarterhill. Adjusted EBITDA should not be interpreted as an alternative to net (loss) income and cash flows from operations as determined in accordance with IFRS or as measure of liquidity. The most directly comparable IFRS financial measure is Net (loss) income.
Adjusted EBITDA per share - Non-IFRS ratio
Adjusted EBITDA per share is calculated as Adjusted EBITDA divided by the basic weighted average of common shares. Adjusted EBITDA per share is used by our management and investors to analyze cash generated by Quarterhill on a per share basis. The most comparable IFRS measure is earnings per share.
Adjusted Working Capital
Adjusted Working Capital is calculated as current assets minus current liabilities, adjusted for convertible debentures and derivative liability. Adjusted Working Capital reflects our net working capital expected to be settled in cash within twelve months.
Backlog - Non-IFRS Financial Measures
We use the non-IFRS measure "backlog" to mean the total value of work that has not yet been completed but that in management's experience of similar situations has: (a) a high certainty of being performed pursuant to existing contracts or work orders specifying job scope, value and timing; (b) an expectation of expansion of existing contracts due to expected extensions; and/or (c) been awarded to one or more of our ITS operating subsidiaries as evidenced by a binding contract or where the finalization of a binding contract is reasonably assured. Activities under such contracts may cover a period of up to 15 years. We do not include in "backlog", the value of any expected but unsigned change orders that management considers may apply to such contracts.
Supplementary Financial Measures
Supplementary financial measures are financial measures disclosed by a company that (a) are, or are intended to be, disclosed on a periodic basis to depict the historical or expected future financial performance, financial position or cash flow of a company (b) are not disclosed in the financial statement of the company, (c) are not non-IFRS financial measures, and (d) are not non-IFRS ratios.
Key supplementary measures disclosed are as follows:
Gross margin %
Calculated as gross profit as a percentage of revenue.
About Quarterhill
Quarterhill is a leading provider of tolling and enforcement solutions in the Intelligent Transportation System (ITS) industry. Our goal is technology-driven global leadership in ITS, via organic growth of our tolling and enforcement businesses, and by continuing an acquisition-oriented investment strategy that capitalizes on attractive growth opportunities within ITS and its adjacent markets. Quarterhill is listed on the TSX under the symbol QTRH and on the OTCQX Best Market under the symbol QTRHF. For more information: www.quarterhill.com.
Forward-looking Information
This news release contains forward-looking information and forward-looking statements within the meaning of applicable Canadian securities laws (collectively, "forward-looking statements") regarding Quarterhill, its operating subsidiaries and their respective businesses. Such forward-looking statements relate to future events, conditions or future financial performance of ?Quarterhill based on future economic conditions and courses of action. All statements other ?than statements of historical fact may be forward-looking statements. Such forward-looking statements ?are often, but not always, identified by the use of any words such as "seek", "anticipate", "budget", ??"plan", "goal", and similar expressions. These statements involve known and unknown risks, assumptions, ?uncertainties and other factors that may cause actual results or events to differ materially from those ?anticipated in such forward-looking statements. The Company believes the expectations reflected in ?those forward-looking statements are reasonable, but no assurance can be given that these expectations ?will prove to be correct and such forward-looking statements included in this news release should not be ?unduly relied upon.? In particular, this news release contains forward-looking statements pertaining to, but not limited to, the ?following: operational and financial expectations for the 2024 financial year, including revenue, gross margin and Adjusted EBITDA expectations; and the Company's business plan.
?Although the forward-looking statements contained in this news release are based upon assumptions ?which management of the Company believes to be reasonable, the Company cannot assure investors ?that actual results will be consistent with these forward-looking statements. With respect to forward-?looking statements contained in this news release, the Company has made assumptions regarding, but ?not limited to: the Company's ability to execute on its business plan; successful integration of Red Fox; general economic and industry trends; operating assumptions relating to the ?Company's operations; demand for the Company's products and services; cost estimates for fixed price contracts; and the other assumptions set forth in the ?Company's most recent annual information form available under the Company's profile on SEDAR+ ?at www.sedarplus.ca.?
The Company's actual results could differ materially from those anticipated in the forward-looking ?statements, as a result of numerous known and unknown risks and uncertainties and other factors ?including, but not limited to: changes in demand for the Company's products and services; general economic, ?political, market and business conditions, including fluctuations in interest rates, foreign exchange rates, ?stock market volatility; reliance on key management personnel; risks related to competition within the Company's industry and relating to technological advances; litigation risks; cyber-security risks; fixed price contracts may result in unexpected costs to the Company; risks of health epidemics, pandemics and similar ?outbreaks; and the other risks set forth in the Company's most recent annual information form ?and management's discussion and analysis for the three and twelve months ended December 31, 2023 available under the Company's profile on SEDAR+ at www.sedarplus.ca.?
The Company's actual results, performance or achievement could differ materially from those ?expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be ?given that any of the events anticipated by the forward-looking statements will transpire or occur, or if ?any of them do so, what benefits the Company will derive therefrom. Readers are therefore cautioned ?that the foregoing lists of important factors are not exhaustive, and they should not unduly rely on the ?forward-looking statements included in this news release. All forward-looking statements contained in this news release are expressly ?qualified by this cautionary statement. Quarterhill has no intention, and undertakes no obligation, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
This news release contains "future-oriented financial information" and "financial outlooks" within the meaning of applicable Canadian securities laws (collectively, "FOFI"), including about the financial results, revenue, gross margin and Adjusted EBITDA of Quarterhill for the year ended December 31, 2024. FOFI, as with forward-looking ?statements ?generally, are, without limitation, based on the assumptions and qualifications, and are subject to the risks, set out ?above in respect of forward-looking statements. Quarterhill's actual financial position and results of operations may differ materially from ?management's ?current expectations and, as a result, the Company's financial results may differ ?materially from ?the FOFI provided in this news release. The Company and its management believe that the FOFI has been prepared on a reasonable basis, reflecting management's best estimates and judgments and the FOFI contained in this news release was approved by management as of the date hereof, for purposes of providing further information about the Company's future business operations and results. However, because this information is subjective and subject to numerous risks and assumptions, it should not be relied on as necessarily indicative of future results. Except as required by applicable securities laws, the Company undertakes no obligation to update such FOFI. Readers are cautioned that the FOFI contained in this news release should not be used for purposes other than for which it is disclosed herein, and such information is ?presented for ?illustrative purposes only and may not be an indication of the Company's actual ?financial position or ?results of operations.?
Interim Condensed Consolidated Statements of Loss and Comprehensive Loss
(in thousands and in United States dollars, except share and per share amounts)
Three months ended June 30, | Six months ended June 30, | |||
2024 | 2023 | 2024 | 2023 | |
(restated) | (restated) | |||
Revenues | $41,513 | $38,623 | $76,410 | $66,969 |
Direct cost of revenues | 32,997 | 28,616 | 61,537 | 53,205 |
Gross profit | 8,516 | 10,007 | 14,873 | 13,764 |
Operating expenses | ||||
Selling, general and administrative expenses | 7,073 | 6,132 | 13,448 | 13,090 |
Research and development expenses | 479 | 1,008 | 796 | 1,877 |
Depreciation of right-of-use assets | 364 | 384 | 708 | 721 |
Depreciation of property, plant and equipment | 383 | 407 | 760 | 818 |
Amortization of intangible assets | 2,140 | 2,088 | 4,377 | 4,175 |
Other charges | 321 | 555 | 1,155 | 1,519 |
10,760 | 10,574 | 21,244 | 22,200 | |
Results from operations | (2,244) | (567) | (6,371) | (8,436) |
Finance income | (97) | (27) | (365) | (60) |
Finance expense | 1,651 | 1,731 | 3,356 | 3,368 |
Foreign exchange (gain) loss | (387) | 769 | (1,497) | 1,104 |
Other income | (267) | (227) | (134) | (458) |
Change in fair value of derivative liability | (432) | (11) | (927) | (215) |
Loss before taxes | (2,712) | (2,802) | (6,804) | (12,175) |
Current income tax expense (recovery) | 272 | (2,688) | 345 | (2,570) |
Deferred income tax (recovery) expense | (17) | 10,073 | 36 | 9,665 |
Income tax expense | 255 | 7,385 | 381 | 7,095 |
Net loss from continuing operations | (2,967) | (10,187) | (7,185) | (19,270) |
Net loss from discontinued operations | - | (11,594) | - | (14,061) |
Net loss | (2,967) | (21,781) | (7,185) | (33,331) |
Other comprehensive loss that may be reclassified | ||||
Foreign currency translation adjustment | (247) | (2,905) | (932) | (2,590) |
Comprehensive loss | ($3,214) | ($24,686) | ($8,117) | ($35,921) |
Loss per share - Basic | ||||
From continuing operations | ($0.03) | ($0.09) | ($0.06) | ($0.17) |
From discontinued operations | - | (0.10) | - | (0.12) |
Loss per share - Basic | ($0.03) | ($0.19) | ($0.06) | ($0.29) |
Loss per share - Diluted | ||||
From continuing operations | ($0.03) | ($0.09) | ($0.06) | ($0.17) |
From discontinued operations | - | (0.10) | - | (0.12) |
Loss per share - Diluted | ($0.03) | ($0.19) | ($0.06) | ($0.29) |
Interim Condensed Consolidated Statements of Financial Position
(in thousands and in United States dollars)
As at | June 30, 2024 | December 31, 2023 | January 1, 2023 |
(restated) | (restated) | ||
Current assets | |||
Cash and cash equivalents | $24,041 | $42,733 | $48,905 |
Short-term investments | - | - | 1,142 |
Restricted short-term investments | - | - | 4,812 |
Accounts receivable, net | 29,396 | 27,291 | 17,155 |
Unbilled revenue | 39,465 | 34,247 | 30,529 |
Income taxes receivable | 130 | - | 251 |
Inventories (net of obsolescence) | 11,453 | 10,760 | 10,076 |
Prepaid expenses and deposits | 4,067 | 4,795 | 5,050 |
108,552 | 119,826 | 117,920 | |
Non-current assets | |||
Accounts and other long-term receivables | 4,516 | 4,364 | 397 |
Long-term prepaid expenses and deposits | - | - | 1,257 |
Right-of-use assets, net | 5,452 | 5,288 | 7,600 |
Property, plant and equipment, net | 3,786 | 4,136 | 5,104 |
Intangible assets, net | 79,799 | 79,092 | 104,164 |
Investment in joint venture | 4,782 | 5,054 | 5,712 |
Investment in other entity | 2,898 | 2,898 | - |
Deferred compensation asset | 1,048 | 952 | 991 |
Deferred income tax assets | - | - | 18,903 |
Goodwill | 31,046 | 29,019 | 41,556 |
133,327 | 130,803 | 185,684 | |
TOTAL ASSETS | $241,879 | $250,629 | $303,604 |
Liabilities | |||
Current liabilities | |||
Accounts payable and accrued liabilities | $28,350 | $30,330 | $34,685 |
Income taxes payable | 734 | 662 | 724 |
Current portion of lease liabilities | 2,056 | 1,954 | 1,924 |
Current portion of deferred revenue | 6,869 | 5,806 | 6,295 |
Current portion of long-term debt | 2,125 | 2,125 | 21,588 |
Convertible debentures | 37,840 | 38,196 | 35,655 |
Derivative liability | 1,296 | 2,290 | 1,316 |
79,270 | 81,363 | 102,187 | |
Non-current liabilities | |||
Deferred revenue | 1,252 | 621 | 2,022 |
Long-term lease liabilities | 5,529 | 5,727 | 7,116 |
Long-term debt | 16,293 | 17,312 | - |
Deferred compensation liabilities | 1,065 | 945 | 862 |
Deferred income tax liabilities | 2,032 | 1,221 | 1,519 |
26,171 | 25,826 | 11,519 | |
TOTAL LIABILITIES | 105,441 | 107,189 | 113,706 |
Shareholders' equity | |||
Capital stock | 314,119 | 313,738 | 401,248 |
Contributed surplus | 126,863 | 126,129 | 37,545 |
Accumulated other comprehensive income | 14,720 | 15,652 | 15,928 |
Deficit | (319,264) | (312,079) | (264,823) |
136,438 | 143,440 | 189,898 | |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $241,879 | $250,629 | $303,604 |
Interim Condensed Consolidated Statements of Cash Flows
(in thousands and in United States dollars)
Three months ended June 30, | Six months ended June 30, | ||||
2024 | 2023 | 2024 | 2023 | ||
(restated) | |||||
Operating activities: | |||||
Net loss from continuing operations | ($2,967) | ($10,187) | ($7,185) | ($19,270) | |
Add (deduct) non-cash items: | |||||
Stock-based compensation expense | 708 | 39 | 1,212 | 270 | |
Depreciation and amortization | 2,887 | 2,879 | 5,845 | 5,714 | |
Foreign exchange (gain) loss | (387) | 769 | (1,497) | 1,104 | |
Other income | (315) | (227) | (134) | (458) | |
Deferred and non-cash income tax (recovery) expense | (17) | 10,073 | 36 | 9,665 | |
Embedded derivatives | (33) | - | 6 | 93 | |
Change in fair value of derivative liability | (432) | (11) | (927) | (215) | |
Non-cash interest expense | 552 | 873 | 1,092 | 1,351 | |
Net change in non-cash working capital balances | 806 | (11,083) | (7,760) | (11,704) | |
Cash generated from (used in) continuing operations | 802 | (6,875) | (9,312) | (13,450) | |
Net operating cash flows attributable to discontinued operations | - | (3,378) | - | (4,685) | |
Net cash generated from (used in) operating activities | 802 | (10,253) | (9,312) | (18,135) | |
Financing activities: | |||||
Dividends paid | - | (1,067) | - | (2,127) | |
Payment of lease liabilities | (561) | (436) | (1,138) | (828) | |
Repayment of long-term debt | (531) | (625) | (1,062) | (1,250) | |
Cash used in financing activities | (1,092) | (2,128) | (2,200) | (4,205) | |
Net financing cash flows attributable to discontinued operations | - | (51) | - | (100) | |
Net cash used in financing activities | (1,092) | (2,179) | (2,200) | (4,305) | |
Investing activities: | |||||
Net proceeds from disposition of a subsidiary | - | 32,021 | - | 32,021 | |
Cash sold on disposition of a subsidiary | - | (8,000) | - | (8,000) | |
Acquisition of business, Red Fox | (7,181) | - | (7,181) | - | |
Cash acquired on acquisition of business, Red Fox | 2,296 | - | 2,296 | - | |
Proceeds from sale of property, plant and equipment | 10 | - | 10 | - | |
Purchase of property, plant and equipment | (344) | (305) | (545) | (638) | |
Capitalized software costs | (650) | (932) | (1,373) | (2,316) | |
Cash (used in) generated from investing activities | (5,869) | 22,784 | (6,793) | 21,067 | |
Net investing cash flows attributable to discontinued operations | - | 1,194 | - | 1,194 | |
Net cash used in investing activities | (5,869) | 23,978 | (6,793) | 22,261 | |
Foreign exchange on cash held in foreign currencies | (223) | (2,514) | (386) | (2,692) | |
Net (decrease) increase in cash and cash equivalents | (6,382) | 9,032 | (18,692) | (2,871) | |
Cash and cash equivalents, beginning of period | 30,423 | 37,002 | 42,733 | 48,905 | |
Cash and cash equivalents, end of period | $24,041 | $46,034 | $24,041 | $46,034 | |
Interim Condensed Consolidated Statements of Shareholders' Equity
(in thousands and in United States dollars)
Capital | Contributed | Accumulated | Deficit | Total | |
Balance, January 1, 2023 (restated) | $401,248 | $37,545 | $15,928 | ($264,823) | $189,898 |
Net loss | - | - | - | (33,331) | (33,331) |
Other comprehensive loss | - | - | (2,590) | - | (2,590) |
Stock-based compensation expense | - | 288 | - | - | 288 |
Common shares issued from restricted stock units | 60 | (63) | - | - | (3) |
Reduction of stated capital | (87,948) | 87,948 | - | - | - |
Dividends declared | - | - | - | (1,060) | (1,060) |
Balance, June 30, 2023 | $313,360 | $125,718 | $13,338 | ($299,214) | $153,202 |
Balance, January 1, 2024 | $313,738 | $126,129 | $15,652 | ($312,079) | $143,440 |
Net loss | - | - | - | (7,185) | (7,185) |
Other comprehensive loss | - | - | (932) | - | (932) |
Stock-based compensation expense | - | 1,212 | - | - | 1,212 |
Common shares issued from restricted stock units | 326 | (423) | - | - | (97) |
Common shares issued from deferred stock units | 55 | (55) | - | - | - |
Balance, June 30, 2024 | $314,119 | $126,863 | $14,720 | ($319,264) | $136,438 |
Reconciliation of Net Loss to Adjusted EBITDA
(in thousands and in United States dollars, except share and per share amounts)
Three months ended June 30, | ||||
2024 | 2023 | |||
$ | Per Share [2] | $ | Per Share | |
(restated) | ||||
Net loss from continuing operations | ($2,967) | ($0.03) | ($10,187) | ($0.09) |
Adjusted for: | ||||
Income tax expense | 255 | 0.00 | 7,385 | 0.06 |
Foreign exchange (gain) loss | (387) | (0.00) | 769 | 0.01 |
Finance expense, net | 1,554 | 0.01 | 1,704 | 0.02 |
Other charges | 321 | 0.00 | 555 | 0.01 |
Depreciation and amortization | 2,887 | 0.03 | 2,879 | 0.03 |
Stock based compensation expense | 708 | 0.01 | 39 | 0.00 |
Change in fair value of derivative liability | (432) | (0.00) | (11) | (0.00) |
Other income | (267) | (0.00) | (227) | (0.00) |
Adjusted EBITDA [1] | $1,672 | $0.01 | $2,906 | $0.03 |
________________ | ________________ | ________________ | ________________ | |
Weighted average number of Common Shares | ||||
Basic | 115,274,980 | 114,649,772 | ||
Six months ended June 30, | ||||
2024 | 2023 | |||
$ | Per Share [2] | $ | Per Share | |
(restated) | ||||
Net loss from continuing operations | ($7,185) | ($0.06) | ($19,270) | ($0.17) |
Adjusted for: | ||||
Income tax expense | 381 | - | 7,095 | 0.06 |
Foreign exchange gain | (1,497) | (0.01) | 1,104 | 0.01 |
Finance expense, net | 2,991 | 0.03 | 3,308 | 0.03 |
Other charges | 1,155 | 0.01 | 1,519 | 0.01 |
Depreciation and amortization | 5,845 | 0.05 | 5,714 | 0.05 |
Stock based compensation expense | 1,212 | 0.01 | 270 | 0.00 |
Change in fair value of derivative liability | (927) | (0.01) | (215) | (0.00) |
Other income | (134) | - | (458) | (0.00) |
Adjusted EBITDA [1] | $1,841 | $0.02 | ($933) | ($0.01) |
________________ | ________________ | ________________ | ________________ | |
Weighted average number of Common Shares | ||||
Basic | 115,186,092 | 114,644,764 | ||
1. | Please refer to the Adjusted EBITDA Non- IFRS Financial Measures section for further information. |
2. | Please refer to the Supplementary Financial Measures for further information. |
SOURCE Quarterhill Inc.
