EDMONTON, AB / ACCESSWIRE / May 5, 2021 / OneSoft Solutions Inc. (the "Company" or "OneSoft") (TSXV:OSS)(OTCQB:OSSIF), a North American developer of cloud-based business solutions, announces its financial results for the three months ended March 31, 2021 ("Q1 2021").
Please refer to the Unaudited Condensed Consolidated Interim Financial Statements and Management's Discussion and Analysis ("MD&A") for the three months ended March 31, 2021 filed on SEDAR at www.sedar.com for more information. All dollar amounts are denominated in Canadian dollars.
FINANCIAL RESULTS
|
(in C$,000, per share in C$) |
Three months ended |
|||
|
March 31, |
March 31, |
Change |
||
|
$ |
$ |
$ |
% |
|
|
Revenue |
954 |
1,675 |
(721) |
(42.9) |
|
Gross profit |
708 |
1,334 |
(626) |
(47.0) |
|
Net (loss) income |
(994) |
27 |
(1,021) |
(3,783.1) |
|
Exchange loss on translation of foreign operations |
(8) |
(16) |
8 |
46.9 |
|
Comprehensive (loss) income |
(1,003) |
11 |
(1,014) |
(9,217.5) |
|
Weighted average common shares |
115,885 |
113,111 |
||
|
Net loss per share |
(0.01) |
- |
- |
|
|
March 31, |
December 31, |
|||
|
Cash and cash equivalents |
7,435 |
7,223 |
||
|
Working capital |
5,933 |
6,226 |
||
Highlights of QUARTER ENDED MARCH 31, 2021
- Revenue for the quarter was $953,916, a decrease of $721,570 from Q1 2020 revenue. While revenue of the Company's Cognitive Integrity ManagementTM ("CIM") software-as-a-service ("SaaS") solution and pipeline miles under CIM subscription increased because new customers were added year over year, the overall decrease in revenue this quarter was due to initial ingestion of data logs into CIM in February 2020 during a new Client's initial software implementation. A decrease in the average U.S. foreign exchange rate from 1.3449 last year to 1.2660 this year negatively affected revenue by approximately $59,000.
- Some of the Company's clients elect to estimate their CIM consumption and pay for it in advance of future use. During Q1 2021, the Company received approximately $2.8 million in such advance payments from customers, which was recorded as deferred revenue. These payments, less CIM consumed during the quarter and recognized as revenue, caused the Company's deferred revenue to increase by $2,146,929 during the quarter to $2,560,475 at quarter-end.
- Generation of new sales leads, sales activities and CIM Production Trials involving prospective customers in the U.S.A., South America, Australia and Middle East countries continued in Q1 2021, conducted by the Company's sales team and in collaboration with reseller partners based in Australia and United Arab Emirates. We anticipate that these collective sales efforts may result in future new commercial contracts for CIM use.
- The Company experienced higher operating expenses than in Q1 2020 due to having added more personnel to accelerate research and development of new software functionality to increase the Company's competitive moat and to pursue new markets for its solutions.
- At March 31, 2021, cash and cash equivalents totaled $7.4 million ($7.2 million at December 31, 2020). Working capital (current assets less current liabilities) was $5.9 million ($6.2 million at December 31, 2020), and the Company has no debt. Assuming customers renew and pay their 2021 contracts for CIM usage similar to fiscal 2020 and there are no significant changes in its current business strategies and cash consumption, the Company believes it has sufficient cash on hand to fund its business and growth strategies as envisioned.
- The Company focused on advancing Cathodic Protection (for which prototype SaaS versions were first made available to private preview users in the Fall of 2020) and Risk functionality during the quarter. On March 9, 2021 the Company announced the acquisition of intellectual property that is being integrated into the CIM platform as a component of its Risk functionality. The acquired IP includes algorithms and processes that leverage machine learning to perform data analytics associated with measuring the probability that anomalies found in pipeline inspections might cause the safe operating pressure of the pipeline to be exceeded. This analysis, often referred to as probability of exceedance ("POE"), supports the prioritization of on-going inspections and mitigations and aligns with regulatory requirements mandated by PHMSA 192 & 195 safety statutes for U.S. pipeline operations.
ACTIVITIES SUBSEQUENT TO MARCH 31, 2021
On April 7, 2021 the Company announced that one of the largest refined products pipeline companies in the U.S.A., with pipelines spanning Texas to the North Eastern U.S seaboard, entered into a multi-year agreement to use CIM for integrity management of its pipeline operations.
On April 20, 2021 Phillips 66 Pipeline LLC ("P66"), the Company's first CIM client, was awarded the Distinguished Pipeline Safety Award by the American Petroleum Institute, which has 600 members representing all segments of the U.S.A.'s natural gas and oil industry. This award recognizes operators who have distinguished themselves as champions of industry innovation and operational excellence. P66 was selected as the winner in the large operator category after recording an outstanding year in employee safety and for its use of comprehensive risk modelling and a health, safety and environment management system that resulted in zero pipeline system release events. Additionally, P66 was noted for its commitment to cutting-edge research and development that has potential to improve pipeline safety for the entire industry. P66 uses CIM as the key component of its pipeline integrity management system.
On April 27, 2021 the Company announced a joint initiative to deploy C-FER's risk models on the CIM platform, which Management believes will deliver the most advanced integrity and quantitative risk management solutions available for oil and gas pipeline operators today.
BUSINESS OUTLOOK
Management is pleased with the Company's activity during Q1 2021 to advance our technology, solutions, market presence and opportunities, which are proceeding in accordance with expectations. We remain confident that our first mover advantage in leveraging machine learning, data science and cloud computing continues to provide a strong competitive moat and that knowledge of the high value that CIM contributes to clients is becoming better known globally through technical publications, presentations and word of mouth referrals, which we believe will assist the Company to continue to gain market traction.
Interest in our CIM solution has grown due to sales activities currently underway in the U.S.A., Canada, Australia, United Arab Emirates, Brazil, and Argentina with numerous CIM Production Trials planned or in various stages of completion, which we anticipate will result in completed sales in future periods. Various business development initiatives are also underway, with objectives to recruit additional CIM resellers and pursue new potential markets and revenue sources based on our CIM technology and platform.
Given the Company's strong balance sheet with $7.4 million of cash and equivalents at quarter end, no debt, current cash burn rate, and anticipated revenue going forward, Management believes the Company is well-funded to execute current business plans as envisioned without requirement to raise additional capital.
GRANT OF STOCK OPTIONS
On May 4, 2021, following the Company's Annual General and Special Meeting of the shareholders, 800,000 stock options were granted to the Directors, Officers, and senior executives of the Company as part of their compensation plans. All options granted have a strike price of $0.63 per share, vest 50% on each of the grant and anniversary dates and will expire in five years if not exercised.
ON BEHALF OF THE BOARD OF DIRECTORS
ONESOFT SOLUTIONS INC.
Douglas Thomson
Chair
For more information, please contact
|
Dwayne Kushniruk, CEO |
Sean Peasgood, Investor Relations |
Forward-looking Statements
This news release contains forward-looking statements relating to the future operations and profitability of the Company and other statements that are not historical facts. Forward-looking statements are often identified by terms such as "may", "should", "anticipate", "expects", "believe", "will", "intends", "plans" and similar expressions. Any statements that are contained in this news release that are not statements of historical fact may be deemed to be forward-looking statements. Such forward-looking information is provided to deliver information about management's current expectations and plans relating to the future. Investors are cautioned that reliance on such information may not be appropriate for other purposes, such as making investment decisions.
In respect of the forward-looking information and statements the Company has placed reliance on certain assumptions that it believes are reasonable at this time, including expectations and assumptions concerning, among other things: the impact of Covid-19 on the business operations of the Company and its current and prospective customers, the availability and cost of labor and services; the efficacy of its software; our interpretation based on various industry information sources regarding the total miles of pipeline in the USA and globally, which segments are piggable; our understanding of metrics, activities and costs regarding evaluation, inspection and maintenance is in alignment with various industry information sources and is reasonably accurate; that counterparties to material agreements will continue to perform in a timely manner; that there are no unforeseen events preventing the performance of contracts; that there are no unforeseen material development or other costs related to current growth projects or current operations; the success of growth projects; future operating costs; interest and foreign exchange rates; planned synergies, capital efficiencies and cost-savings; the sufficiency of budgeted capital expenditures in carrying out planned activities; and no changes in applicable tax laws. Accordingly, readers should not place undue reliance on the forward-looking information contained in this press release. Since forward-looking information addresses future events and conditions, such information by its very nature involves inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to many factors and risks. These include but are not limited to the risks associated with the industries in which the Company operates in general such as: costs and expenses; interest rate and exchange rate fluctuations; competition; ability to access sufficient capital from internal and external sources; and changes in legislation, including but not limited to tax laws.
Readers are cautioned that the foregoing list of factors is not exhaustive. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement. The forward-looking statements contained in this news release are made as of the date of this news release, and the Company undertakes no obligation to update publicly or to revise any of the included forward-looking statements, whether because of new information, future events or otherwise, except as expressly required by Canadian securities law.
This news release does not constitute an offer to sell or the solicitation of an offer to buy any securities within the United States. The securities to be offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended, or any state securities laws, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of such Act or other laws.
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.
SOURCE: OneSoft Solutions Inc.
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https://www.accesswire.com/644640/OneSoft-Solutions-Inc-Reports-Financial-Results-for-the-Quarter-ended-March-31-2021
