Wishpond Technologies Ltd.

Hello, everyone. Thank you, everyone, for joining us today, and welcome to Wishpond's 2022 Fiscal Fourth Quarter and Fall Year 2022 Financial Resource Conference Call. My name is Angelica, and joining me on the call today are Alitash Kander, Chairman, Founder, and CEO of Wishpond, and David Pais, the company's CFO. The call has been recorded. We'll be having question and answer session at the end of the call, which will be limited to analysts only. 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 statements and management discussion and analysis from CEDAR.com. Okay, please note portions of today's calls, other than historical performance, include statements of forward-looking information within the meaning of applicable security laws. These statements are made under the State Harbor provisions of those laws. Forward-looking statements involve known and unknown risks, uncertainties, assumptions, and other factors, many of which are outside of wishbone's control, that may cause the actual results, performance, or achievements to differ materially from anticipated results. Performance or achievements imply but 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 in 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 events, conditions, assumptions, or circumstances in which any such statement is based, except if it's required by law. We use terms such as gross profit, gross margin, adjusted EBITDA, analyzed revenue run rate, and monthly recurring revenue on this conference call, which are non-IRS and non-GAAP measures. For more information on how we define those terms, please refer to the definition set up in our management discussion and analysis. And with that, let me turn the call over to Mr. Ali Tashkander, Chairman and CEO.

Thank you very much, Angelica. Good day, everyone. We hope that you're all keeping safe and healthy. We truly appreciate everyone for joining us today. On today's call, I will first provide some general commentary and an update on the quarter and the full year ended December 31st, 2022, followed by our CFO, David Pace, who will provide a financial summary of our results. I will then come back and provide some commentary on our outlook, And we'll go from there. 2022 was another extraordinary year for Wishbone, as we repeatedly set record financial results. The company had record revenue in the fourth quarter, and we continue to experience increasing demand for our products, even during an environment of uncertain macroeconomic conditions. Wishbone also continues to maintain a strong financial position with a clean balance sheet. Our healthy balance sheet and market position allows us to be in an enviable position to maintain our strong organic growth while investing in R&D to develop and deliver innovative digital marketing products to our customers. We are especially thrilled with our fourth quarter and annual results, which were the strongest in the company's history with record revenue, adjusted EBITDA, and cash flow generation. which one achieved record revenues of $5.9 million in Q4 2022, representing approximately over 23 million annualized revenue run rate, driven by the company's focus on organic growth and successful market positioning. We are also pleased to report another quarter of record positive cash flows from operations of roughly $800,000. We believe that as part of the cost reduction initiatives we launched earlier in the year, we were able to drive profitable growth by scrutinizing all new expenditures with the intent of optimizing operations and achieving cost savings synergies. As a result of these cost optimization efforts, WishBond was able to achieve both record positive cash flows from operations and record positive adjusted EBITDA in Q4 2022. We've now achieve positive operating cash flows for three quarters in a row, which allows the company to invest in organic and inorganic growth initiatives without the need to raise additional capital. Our applicant is strong and positive for 2023 with increasing sales, improving margins, and positive cash flows. We expect to continue to grow rapidly as our sales pipeline remains robust with the launch of Propel IQ, our new next-generation marketing platform, and the introduction of artificial intelligence-powered marketing tools. I will provide additional details on our outlook later on the call, but first I would like to turn it over to our CFO, David, who will review the financial results for the quarter. David? David, you're on mute.

Oh, I apologize for that. Okay. Thank you, Ali. And thanks, everybody, for joining us on the call this morning. I'm pleased to report that we had very strong annual and fourth quarter results for the year and three months ended December 31, 2022. The financial highlights for fiscal 2022 are as follows. Wishpond achieved record annual revenue of $20.5 million during fiscal 2022, compared to revenue of $14.8 million in fiscal 2021, an increase of 39%. The increase in revenue was primarily driven by organic growth resulting from strong product demand, an increase in sales and marketing activities, and new product introductions. The company also completed its acquisition of viral loops in Q2 2022, which contributed to revenue growth over the past year. The United States remains our largest market, generating approximately 70% of our total revenue in 2022, with approximately 14% and 16% of revenue generated from Canada and the rest of the world, respectively. Wishpond achieved gross profit of $13.6 million in fiscal 2022 compared to $10 million last year, representing an increase of 36% driven by an increase in overall revenue. Wishpond's gross margin percentage was 66% during fiscal 2022 compared to 68% in fiscal 2021. The gross margins were within the company's historical range of 65 to 70%. Wishpond achieved record positive adjusted EBITDA of $648,000 in fiscal 2022, compared to an adjusted EBITDA of $56,000 in fiscal 21. The improvement is primarily driven by higher revenue and continued cost management initiatives and operational efficiencies initiated in 2022. In fiscal 2022, WishBond generated net positive cash provided by operating activities of $1 million, compared to cash burn from operating activities of $1.5 million in fiscal 2021. In the second quarter of 2022, the company implemented several cost reduction and operational efficiencies designed to conserve cash. These changes have resulted in the company realizing more than $1 million in annual cost savings. Our commitment to realizing cost efficiencies while still achieving growth is what permitted us to generate record cash flow and EBITDA in 2022. Our fourth quarter financial 2022 results are as follows. Wishpond achieved record revenue of $5.9 million in Q4 2022, compared to revenue of 4.7 million generated during Q4 2021, an increase of 27%. Revenue growth was positively impacted by seasonality in Wishpond's acquired businesses, the expansion of the company's sales team, and integration of our acquisitions. Wishpond achieved gross profit of $4 million compared to 3.2 million during Q4 2021, representing an increase of 27% driven by an increase in overall revenue. Wishpond's gross margin percentage at Q4 2022 was 68%, which is similar to the gross margin percentage in Q4 2021. During Q4 2022, Wishpond achieved record positive adjusted EBITDA of $687,000 compared to an adjusted EBITDA of $491,000 in Q4 2021, an increase of 40%. Adjusted EBITDA margin was 11% for Q4 2022 compared to 10% in Q4 2021. The improvement is primarily driven by higher revenue and continued cost management initiatives and operational efficiencies initiated earlier in the year. During Q4 2022, Wishpond achieved record positive cash flow from operations of $803,000 compared to $406,000 in Q4 2021. We continue to have a clean and healthy balance sheet. As at December 31, 2022, Richemont had $3 million in cash and short-term investments and no debt. In the prior quarter and at September 30, 2022, the company had cash and short-term investments of $2.7 million. Wishpond has a $6 million secure operating credit facility with National Bank of Canada's Technology and Innovation Banking Group, which remains ungrown as of today. In summary, Wishpond remains in a very strong financial position with a healthy balance sheet, solid monthly recurring revenue, and very good visibility of revenue and cash flow. Wishpond is able to continue growing comfortably from its cashflow from operations without the need for any additional equity or debt capital raise. I will now provide an update on a normal course issue a bid or shared buyback program. On June 15, 2022, the company announced that the renewal of its normal course issue a bid or NCIB was approved by the exchange. During the full year 2022, the company purchased 152,600 common shares under the NCIB for aggregate consideration of $166,570. The board of directors of Wishbond believes that the recent market prices of the company's common shares do not properly reflect the underlying value of such shares, and that using some of the company's surplus cash under the NCIB would be in the best interest of the company and its shareholders. The company intends to judiciously purchase shares under the NCIB program based on available cash. As of the end of the fourth quarter of December 31, 2022, the company had 53,705,324 common shares issued and outstanding. This concludes my financial update and I will turn the call back over to Ali.