Quotemedia Inc

Good day, everyone, and welcome to today's Quote Media Year-End Results Conference Call. It is now my pleasure to turn the conference over to Dave Schroen. Please go ahead.

Welcome, everyone, and thank you for joining us today. I have a brief safe harbor, and we'll get started. Except for historical information contained herein, the statements in this conference call include forward-looking statements that are made pursuant to the safe harbor provisions in the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties that may cause our actual results in future periods to differ materially from forecasted results. And now we're happy to go through our 2024 year-end results. As we closed out 2024, I'd like to reflect on the year and share where we stand as we head into 2025. 2024 was a challenging year in some respects. and we ended the year with a modest decline, about 1% from the previous year. While that's not the growth we've historically delivered, we view this as a short-term pause, not a long-term trend. We finished the year with revenue just under $19 million. That slight dip was primarily due to client-side challenges, where a few of our clients scaled back or ceased operations, and others downgraded to lower-cost data alternatives. Importantly, this was not because of our services. It was more about their own internal shifts or challenges in their own businesses. That said, we responded quickly. We closed quite a number of new deals and expanded existing client contracts late in the year. And because of those Q4 signings, along with several new contracts already closed in Q1 of 2025, we've entered the year with real momentum. We are very pleased that we anticipate our Q1 2025 revenue to be our highest quarter in the company's history. Our current revenue run rate is approaching $5 million per quarter, which is $20 million annually, and we expect that revenue growth will continue improving as the year progresses. Our sales pipeline is very strong, and we have many more large deals in the works, so 2025 is looking to be quite exciting. In addition, our deferred revenue is $2.4 million, which is a very encouraging sign. As a reminder, deferred revenue represents contracted work that we've already performed and collected payment for but has to be recognized in the future. We've also made excellent progress on the product front in 2024. New data solutions as well as many new product and feature enhancements were launched and are on track to launch in the coming months and throughout the year. And we're confident these will create new revenue opportunities both for us and for our clients. So while 2024 was flat from a growth perspective, it was also foundational. We've strengthened our client relationships, built up our future revenue pipeline, and set the stage for what we believe will be a very strong rebound in 2025. I'll now pass the mic over to Keith Randall to walk us through the financial details for the year. and then we'll be happy to take your questions.

Thank you, Dave, and welcome, everyone. I'll start with the income statement. Note that all comparisons are on a year-over-year basis unless otherwise noted. We had a 1% decrease in total revenue for the year as all our revenue categories decreased by 1%. One of our larger customers reduced their spending with Pope Media, and another large customer was forced to discontinue services due to financial difficulties. offsetting the revenue from new clients added during the year. Our cost of revenue increased 7% for the year. Our cost of revenue consists of fixed and variable stock exchange fees and other data costs and amortization of capitalized development costs. The increase is mainly due to increased amortization expense associated with the capitalized costs related to improving infrastructure, new product development, data collection, and the expansion of our global market coverage. Our gross margin percentage decreased from 51% to 47% as our cost of revenue increased while our revenue remained flat. Our total operating expenses increased 10% for the year. Sales and marketing expenses increased 7% due to additional sales personnel hired to support our product growth initiatives and salary increases for existing personnel. The increase was offset by the 2% depreciation of the Canadian dollar from the comparative period, as most of our sales personnel are located in Canada. G&A expenses increased 9%, primarily due to the $360,000 increase in bad debt expense. This was mainly due to a significant client discontinuing our services due to their financial struggles, which led to a loss of recurring revenue as well as a large bad debt write-off. Software development expenses increased by 15%, primarily due to new personnel hired since the comparative period to improve our infrastructure, security, and business continuity management. The increase in software development expenses was also due to a decrease in the percentage of total development costs capitalized in 2024 compared to the prior period. The increase in development personnel cost was offset by the 2% depreciation of the Canadian dollar from the comparative period. Like our sales staff, our development personnel are mainly located in Canada. Our net loss for the year was $1.3 billion compared to net income of $360,000 in the comparative year. Our net loss was due to our cost of sales increasing $600,000 during the year, while our revenue remained relatively flat. Increased personnel costs and the increase in bad debt expense also contributed to our net loss. Our adjusted EBITDA was $1.8 million compared to $3 million in the comparative year, a decrease of $1.2 million. Please refer to the reconciliation included in our press release for the calculation of adjusted EBITDA. Turning now to our balance sheet and cash flow statement, our cash totaled $585,000 at year end, which was a $243,000 increase from our year-end cash balance of $342,000. Our deferred revenue totaled $2.4 million at year-end. The future costs associated with realizing that revenue is minimal, as most of our deferred revenue relates to setup and development work already completed. Those setup and development fees have been deferred and will be recognized in future years over the service contract to which they relate. Our year-to-date net cash flow from operations was $3.7 million, while net cash used in investing activities was $3.4 million, primarily due to spending on infrastructure and product development. Going forward, we're expecting to return to positive revenue growth in fiscal 2025. And as Dave mentioned earlier, based on sales that have already closed, we anticipate that revenue in Q1 2025 will be the highest in our company's history. We also reduced our development spending in late 2024 as some of our major development products are near completion. With improved revenue growth combined with cost control measures already implemented, we expect our bottom line to improve in 2025. Thank you, and I'll now pass it back to Dave.