Wishpond Technologies Ltd.

Thank you everyone for joining us today and welcome to Wishpond's 2024 Fiscal First Quarter Financial Results Conference Call. My name is Adrian Lim, Group Controller, and joining me on the call today are Ali Tashkandar, Chairman, Founder, and CEO of Wishpond, and David Pace, the company's CFO. This call is being recorded. We will be having a 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 cedarplus.ca. 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 provision of those laws. Please refer to today's press release and in our management discussion and analysis for disclosure of risks and uncertainties. We provide forward looking statements solely for the purpose of providing information about management's current expectations and plans relating to the future. we do not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements and to reflect any change in our expectations or any change in events conditions assumptions or circumstances on which any such statement is based except if it is required by law We use terms such as adjusted EBITDA, annualized revenue run rate, and monthly recurring revenue on this conference call, which are non-IFRS and non-GAAP measures. For information on how we define these terms, please refer to the definition set out in our management discussion and analysis. And with that, let me turn the call over to Mr. Ali Tavskandar, Chairman and CEO.

Thank you very much, Adrian. Good day, everyone. We truly appreciate everyone for joining us today. On today's call, I will first provide some general commentary and an update on the first quarter ended March 31st, 2024, followed by our CFO, David Pace, who will provide a financial summary of our quarterly results. I will then come back and provide some commentary on our outlook. First quarter of 2024 marked another historic chapter in the company's history as we successfully completed the development of our flagship and much anticipated Sales Closer AI product, which subsequently launched in April 2024. Sales Closer AI has generated immense interest within the industry as we pioneered the future of sales calls and product demos through the use of an artificial intelligence agent. With the combination of Propel IQ and Sales Closer AI, Wishbone is poised for its next phase of growth. Propel IQ establishes us as a front runner among a select group of digital marketing companies, offering an all-in-one bundled sales and marketing platform. We are also confident that our Sales Closer AI product will lead the charge in reshaping how companies engage with their stakeholders, heralding a new era of efficiency and effectiveness in sales processes. Turning to our financial results, I'm very pleased with our record first quarter. Wishbone achieved revenues of $6.1 million in Q1 2024, representing approximately over $24 million of annualized revenue run rate. This growth has been driven by the company's focus on organic growth and successful market positioning. We're thrilled to report an 8% year-over-year revenue growth in Q1 2024 with stable performance quarter-over-quarter, a particularly exciting achievement considering the typical seasonal downturn expected of this quarter compared to Q4. In the first quarter, we maintained our streak of achieving positive adjusted EBITDA for the seventh consecutive quarter and we achieved a 39% improvement in adjusted EBITDA compared to Q1 of last year. This improvement stems from the sustained momentum of our cost optimization initiatives initiated last year, coupled with the ongoing growth of our various product lines. The company's outlook for the remainder of 2024 is incredibly promising as the transition of our sales team to focus on Propel IQ in Q4 2023 will start bearing fruit. Our cash position should improve in 2024 as a result of higher revenues and because the company has completely paid out all of its earn outs related to prior acquisitions, which David will discuss in further detail. We are confident in our ability to fuel the company's future growth through operational cash flow and our $6 million credit facility, with future financings earmarked primarily for seizing acquisition opportunities. I will provide additional details on our output 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 year.

Thank you, Ali, and thanks, everyone, for joining us on the call this morning. I'm pleased to report that we have achieved strong results in revenue, gross profit, and adjusted EBITDA for the quarter ended March 31, 2024. Wishpond achieved quarterly revenue of $6.1 million during Q1 2024 compared to $5.6 million in Q1 2023, an increase of 8%. Revenue growth was primarily driven by stronger product demand, an increase in sales and marketing activities, and new product introductions. The revenue from a legacy customer reduced from $525,000 in Q1 2023 to $268,000 in Q1 2024. Without this decrease in revenue from email delivery services, Revenue from the rest of the business would have increased by 13%. Wishbone achieved record gross profit of $4.1 million in Q1 2024 compared to $3.7 million in Q1 2023, representing a 12% increase, which was driven by an increase in overall revenue. Wishpond achieved a gross margin percentage of 68% during Q1 2024 compared to 66% in Q1 2023 and in line with the company's historical performance. During Q1 2024, Wishpond achieved adjusted EBITDA of $290,000 compared to $209,000 in Q1 2023, an increase of 39%. As at March 31, 2024, Wishpond had $2.1 million of cash and debt of $2 million from its bank credit facility. This compares to $1.4 million in cash and debt of $995,000 at December 31, 2023. The reduction in cash net of credit facility balances was caused in part by earn out payments for previously acquired businesses, investment in the business, and changes in working capital. I'm pleased to report that in Q1 2024, we made a final earn out payment related to an acquisition that we completed in 2022. In Q1 2024, we made an earn out payment of $99,000, which compares to cash earn out payments of $371,000 in Q1 2023 and $815,000 in Q1 of 2022. We now have no more earn out commitments and expect our cash position to be favorably impacted in the remainder of the year. Furthermore, in the first half of the year, Wishpond incurs several costs such as compliance costs and some cash and tax payments that do not recur in the second half. This will also have a positive impact on cash in the second half of the year. Wishpond has a $6 million secured revolving operating credit facility with National Bank of Canada's Technology and Innovation Banking Group. While we had an overall net positive cash position at the end of this quarter, we drew from our credit facility for working capital purposes as the company's cash is held in several accounts. Although we are expecting our cash balance to improve in the second half of 2024, we also have undrawn capacity on our credit facility if needed in the future. Last year, the company underwent a cost-cutting program, which included headcount productions and the implementation of AI technologies to improve internal processes. Wishpond has strong monthly recurring revenue and very good visibility of revenue and cashflow. Wishpond is able to continue growing comfortably from its cashflow from operations without the need for any additional equity or debt capital raises. At the end of the first quarter on March 31, 2024, the company had 54,033,620 fully diluted securities issued and outstanding. This concludes my financial update, and I will turn the call back over to Ali.