Wishpond Technologies Ltd.

Thank you everyone for joining us today and welcome to Wishbond's 2021 fiscal fourth quarter and full year 2021 financial results conference call. Joining me on the call today are Ali Tadshkender, chairman, founder, and CEO of Wishbond, and David Pace, the company's CFO. This call is being recorded. We will have a question and answer session at the end of the call. You can submit your questions through the Q&A button at the bottom of the screen. I trust that everyone has received a copy of our financial results press release that was issued earlier today. Listeners are also encouraged to download a copy of our quarterly financial statement and management discussion analysis from cdar.com. Please note, portions of today's call, other than historical performance, include statements of forward-looking information within the meaning of applicable securities laws. These statements are made under the safe harbor provisions of these laws. Forward-looking statements involve known and unknown risks, uncertainties, assumptions, and other factors, many of which are outside of response control, that may cause actual results, performance, or achievements to differ materially from the anticipated results, performance, or achievements implied by such forward-looking statements. These factors are further outlined in today's press release and in our management discussion analysis. We provide forward-looking statements solely for the purpose of providing information about management's current expectations and plans relating to the future. We don't undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in our expectations or any change in advanced conditions, assumptions, or circumstances on which any such statement is based, except if it's required by law. We use gross profit, gross margin, and adjusted EBITDA on this conference hall, which are non-IFRS and non-GAAP measures. For more information on how we define gross profit, gross margin, and adjusted EBITDA, please refer to the definition set out in our imagined discussion analysis. And with that, let me turn the call over to Mr. Ali Tashkander, Chairman and CEO of Wishpond.

Good day, everyone. I'm very excited to be here, and thanks for making the time. We hope that you're all keeping safe and healthy. We truly appreciate you for joining today. Before we begin, I'd like to recognize that this is our first conference call with David Pace as the company's CFO. David joined Wishpond in January of this year and brings with him previous M&A and public company experience. We welcome David to Wishpond team and to this call today. On today's call, I will first provide some general commentary and an update on the quarter, followed by our CFO, David Pace, who will provide the financial summary of the results. I will then come back and provide some commentary on our outlook. Turning to our financial results, 2021 was a monumental year for WishBond as we accomplished record financial results in our first year as a public company on the TSX Venture Exchange. We set an aggressive pace in the first quarter of 2021 that we maintained throughout the year. with organic and inorganic growth culminating in record revenue for the year and a record fourth quarter. We achieved 87% revenue growth in 2021, approximately half of which came from organic growth and half of it from acquisitions. Fourth quarter 2021 was another outstanding quarter for WishBond as we once again achieved record quarterly revenue with 107% year over year growth. Wishbone's revenue growth was driven by the success of our experienced sales team, new product introductions, and our acquisitions. We are very pleased to report record adjusted EBITDA in the fourth quarter of $491,000. We believe that the investments made earlier in 2021 in our product development and sales teams paid off for the company in our Q4 revenue and adjusted EBITDA growth. Last year, we completed four acquisitions, namely Invigo Media, PersistIQ, Brax, and the last one, Winback, was completed on December 31st, 2021. We announced our fifth acquisition and first acquisition of 2022 Viral Loops on April 1st. We are very pleased with the progress we've made with all of our acquisitions. Our acquisition strategy has been to do token acquisitions of marketing technology companies that offer complimentary product solutions to small, medium-sized businesses. All our acquisitions have been cash flow generating companies that can benefit from our sales and marketing expertise. And their products and solutions offer great cross-selling opportunities to our core WishBond customers. We are spending a lot of thought and effort on integrating these products with our platform and developing pricing plans that bring the most value for our customers. We believe that both our existing customers as well as the acquired customers will benefit from the range of online marketing options that they can avail of under one roof. Our acquisition strategy has worked to date and has complemented the company's organic growth very nicely. I will go into our outlook later in this call today. But first, I would like to turn the call over to our CFO, David, who will review the financials for the quarter and the full year. David.

Thank you, Ali. I'm pleased to report that we had very strong annual and full quarter results for the year and three months ended December 31, 2021. Here are some financial highlights for fiscal 2021. Wishpond achieved record annual revenue of $14.8 million during fiscal 2021, compared to $7.9 million in fiscal 2020, an increase of 87%. Revenue growth was primarily driven by an increase in sales and marketing activities, new product introductions, and acquisitions completed in 2021. Wishpond achieved gross profit of $10 million in fiscal 2021, compared to 5.3 million last year, representing a 91% increase from fiscal 2020, driven by an increase in overall revenue and good execution. The gross margin percentage was 68% during fiscal 2021, compared to 66% in fiscal 2020. Wishpond achieved adjusted EBITDA of $56,000 in fiscal 2021 compared to $495,000 in 2020. The decline in annual adjusted EBITDA was primarily due to public company costs, which we didn't have in 2020, and increased investments in our sales and marketing and R&D teams in order to accelerate growth. The United States remains the largest and fastest-growing market, generating 78% of total revenue in the year, and we achieved an 87% year-over-year revenue growth in the U.S. market. Our fourth quarter financial results are as follows. Wishpond achieved record quarterly revenue of $4.7 million during Q4 2021, compared to revenue of $2.3 million generated during Q4 2020, an increase of 107%. Revenue growth in Q4 2021 was positively impacted by seasonality in Wishpond's acquired businesses. In addition, an increase in the size of the company's sales and business development team during the year resulted in higher sales in the fourth quarter. Wishpond achieved gross profit of $3.2 million compared to $1.5 million during Q4 2020, representing an increase of 119%, driven by an increase in overall revenue. Wishpond's gross margin percentage in Q4 2021 was 68% compared to 65% in Q4 2020. The 68% gross margin in Q4 2021 was on the higher end of historical ranges between 65% and 70%. During Q4 2020, Wishpond had an operating loss of $399,000 compared to an operating loss of $4,000 in Q4 2020. During Q4 2021, Wishpond achieved positive cash flow from operation with $599,000 compared to $2.1 million in Q4 2020. During Q4 2021, Wishpond achieved record adjusted EBITDA of $491,000 compared to an adjusted EBITDA of $121,000 in Q4 2020. Adjusted EBITDA margin was 11% for Q4 2021 compared to 5% in Q4 2020. The increase in adjusted EBITDA is attributable to positive EBITDA contribution from Wishpond's acquired subsidiaries and the higher gross profit in the quarter. Just to comment on headcount, at the end of 2021, we had 327, sorry, 237 full-time employees and consultants compared to 124 full-time employees and consultants on December 31st, 2020. The increase in headcount is attributable to the addition of Envigo, PersistIQ, and BRAX employees, as well as an increase in the size of our sales, customer support, and R&D teams. We continue to have a clean and healthy balance sheet. As of December 31, 2021, Wishpond had $6.2 million in cash and cash equivalents, and the company has no debt as of December 31, 2021. On September 29, 2021, the company entered into a new credit facility with the National Bank of Canada for a $6 million secured revolving operating line. The credit facility remains unrun as of this date. In summary, Wishpond is in a very strong financial position with a healthy balance sheet, strong monthly recurring revenue, and a very good visibility on revenue and cash flow for the current year. Wishpond is able to continue to grow comfortably with its cash flow from operations. I will now provide an update on a normal course issue event. On June 7th, 2021, the TSX Venture Exchange accepted a notice of the company's intention to commence a normal course issuer bid, or NCIB, for its common shares. Since the approval of the NCIB on June 7th to December 31st, 2021, the company purchased a total of $248,800. common shares for cancellation at an average price of 1.28 per share. The board of directors of the company believes that the recent market prices of the company's common shares do not properly reflect the underlying value of such shares, and that the purchase of the shares would be a desirable use of corporate funds in the best interest of the company and its shareholders. As such, the company plans to renew the NCIB on its anniversary date. As of the end of the fourth quarter on December 31st, 2021, the company had 55,954,115 fully-diluted securities issued and outstanding. This concludes my financial update, and I will turn the call back to Ali.