Unless otherwise stated, all amounts are in U.S. dollars.
Highest Q4 Monthly Active Users (MAUs) on record at 105.8M, an increase of 18% YoY
Q4 revenue grew to a record $21.4M, an increase of $1.2M or 6% YoY
Q4 Digital Advertising Revenue grew to $15.1M, an increase of 35% YoY
FY 2021 revenue grew to $65.8M, an increase of $8.9M or 16% YoY
FY 2021 Adjusted EBITDA was $29.0M, an increase of 9% YoY, or 18% YoY excluding incremental public company costs, foreign exchange, and government subsidies
VerticalScope Holdings Inc. (“VerticalScope” or the “Company”) (TSX: FORA), a technology company that has built and operates a cloud-based digital platform for online enthusiast communities, today announced financial results for the quarter (“Q4”) and full year ended December 31, 2021.
“2021 was an incredibly successful year for VerticalScope as we continued to experience strong momentum in our business,” commented Rob Laidlaw, Founder and CEO of VerticalScope. “Our business is performing very well, evidenced by our 16% revenue growth and our Adjusted EBITDA growth of 9% compared to 2020 (or 18% YoY when excluding incremental public company costs, FX changes, and government subsidies). Underlying our financial performance, we were able to grow our MAUs to a new record-high of 105.8 million, including 4% organic growth. We are ahead of schedule in our deployment of our IPO capital having completed 21 acquisitions in 2021, and they are performing well for us, which will accelerate our growth in 2022 and beyond.”
Financial Highlights for the Three and Twelve Months Ended December 31, 2021. All comparatives, unless otherwise noted are versus the same period in the prior year:
– Q4 and full year revenue were $21.4M, an increase of 6%, and $65.8M, an increase of 16%, respectively
– Revenue from Digital Advertising recorded double digit growth in both the quarter and year with a Q4 contribution of $15.1M, an increase of 35%, and a full year contribution of $44M, an increase of 37%, led by an increase in digital advertising ARPU. These strong results were achieved in spite of ongoing challenges related to global supply chain disruptions and inventory shortages experienced by several customers, particularly in the automotive and powersports categories.
– E-commerce revenue contributed $6.3M in Q4 and $21.8M for the full year, a decrease of 30% and 12%, respectively. E-commerce revenue was negatively impacted in the period by supply chain disruption, and out-of-stock products, while results in the prior period were elevated due to COVID-19 induced increases in online shopping.
– Full year Adjusted EBITDA was $29M, an increase of 9%. Excluding incremental public company costs, foreign exchange and benefits from government subsidies, Adjusted EBITDA increased by $4.7M or 18%.
– As a result of incremental costs of $15.9M relating to the initial public offering, the amendment of the credit agreement, acquisitions and omnibus incentive plan compensation, total comprehensive loss for the year was $12.4M compared to $1.5M in the prior year.
– Full year cash flows from operating activities were $19.6M, an increase of $5.5M, or 39%.
– Free Cash Flow generated in the year was $23.6M, an increase of $1.8M or 8%. Excluding the full year variances with respect to incremental public company costs, FX and benefits from government subsidies noted above, Free Cash Flow generated in the year was $24.9M, an increase of $4.1M or 20%.
– At the end of the year there were 1,203 communities running on the Fora platform which represent 86% of designated forum community MAU. Fluctuations in this percentage are due to MAU growth through acquisition.
– In Q4, we completed 13 asset and business acquisitions bringing the total number of acquisitions in the year to 21 (for a total cash consideration of $82.5M, and total share consideration of $13.2M not including earnouts).
– We ended the quarter with $20.5M of unrestricted cash and cash equivalents on our balance sheet, and $45M available under our existing credit facility to fund our M&A pipeline.
Laidlaw added, “We are very pleased with the performance improvements we continue to see with sites running on our Fora community platform and the capabilities we have added to VerticalScope with acquisitions completed in Q4 including Threadloom, ProBoards, TheStreamable and HomeTalk. We experienced exceptional growth in digital advertising revenue in Q4, up 35% compared to prior year with strength in both direct and programmatic channels. This growth was achieved in spite of continued challenges from supply chain disruptions and inventory shortages. Although our E-commerce revenue was down in Q4 and full-year 2021 compared to 2020 when we saw a surge in Covid-19 related online shopping, we are optimistic about the long term growth prospects for E-commerce across our platform which will be accelerated by our Threadloom acquisition. We are also very pleased with the pace of capital deployment and the quality of the assets that we have acquired to date.
Chris Goodridge, President and COO, commented that, “Our Q4 M&A activity was incredibly strong with 13 acquisitions completed. In addition to previously announced transactions including HomeTalk, Threadloom, ProBoards and TheStreamable, we added several additional communities that will benefit from the performance improvements that Fora can offer, such as ThumperTalk.com, the leading community for ATV and dirt bike enthusiasts, and AdvRider.com, one of the largest motorcycle communities in North America. Backed by a very strong M&A pipeline we will continue to accelerate VerticalScope’s growth through accretive acquisitions.”
Earnings Announcement
Management will host a conference call and webcast to discuss the Company’s fourth quarter and full year 2021 financial results at 7:30am EST on Thursday, March 10, 2022.
Live Call Registration: https://event.on24.com/wcc/r/3577207/A2CA35D8F8EC53D1FDBF9E13E6218725
Joining by telephone:
Canada: 1 833 950 0062
United States: 1 844 200 6205
All other locations: +1 929 526 1599
Participant Access code: 952574
Webcast: https://event.on24.com/wcc/r/3577207/A2CA35D8F8EC53D1FDBF9E13E6218725
If you are unable to join live, an archived recording of the webcast will be available on the investor relations section of the VerticalScope website.
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