VANCOUVER, B.C. (May 30, 2019) – Datable Technology Corp. (TSXV: DAC) (OTCQB: TTMZF) (the “Company” or “DTC”), a technology company whose core product PLATFORM³ is an integrated suite of digital marketing applications sold as Software-as-a-Service (SaaS), announces its financial results for the quarter ended March 31, 2019 (“Q1 2019”).
For the three months ended March 31, 2019, the Company achieved the following milestones:
• DTC signed 7 new license agreements to provide PLATFORM³ to leading Consumer Packaged Goods (CPG) brands.
• The average dollar value of license agreements has increased by approximately 23% to $85,000 compared to 2018, including short-term targeted shopper marketing promotions and annual/multi-year SaaS licenses.
• Many of these agreements represent a growing trend of repeat business from leading U.S based consumer brands.
• Revenue for Q1 2019 decreased by 21% to $307,318 compared to revenue for the quarter ended March 31, 2018, partly due to the timing of revenue recognition for license agreements signed in prior periods and during Q1 2019.
The Company is also pleased to provide the following 2019 updates:
• In 2019 year to date, DTC has license agreements which account for approximately $1.3 million in total contract value, of which 80% is expected to be recognized as revenue in 2019. About 61% of the new license agreements are with returning customers.
• DTC has several annual agreements where PLATFORM³ hosts an ongoing digital loyalty and rewards program. DTC is generally paid an annual license fee plus transactions fees based on the number of times consumers validate purchases using PLATFORM³. The $1.3 million in contracted revenues noted above only accounts for license and service fees and does not include any transaction fees.
• Subsequent to Q1 2019, DTC signed two master service agreements (“MSAs”) The first MSA was signed with a U.S. marketing and promotions agency with clients such as Proctor & Gamble, Johnson & Johnson, Kraft Heinz, and Unilever. The second MSA was signed with a leading manufacturer of infant and children’s nutrition products and their Canadian infant care division, owned by a large British multinational consumer goods company.
• Subsequent to Q1 2019, DTC signed a Letter of Intent (LOI) with uBuck Technologies SEZC (“uBuck”), a wholly owned subsidiary of LiteLink Technologies Inc. (CSE:LLT) (OTC:LLNKF) (“LiteLink”), to enter into a strategic commercial relationship. Under the terms of the LOI, uBUCK will integrate PLATFORM³, Datable’s loyalty and rewards program into uBUCK’s digital payments platform. This would allow account holders of uBUCK Pay — who can now make online payments and send worldwide payment transfers within seconds without paying for transfer fees — to also earn rewards for purchases and payments made within the uBUCK Pay digital wallet or on their uBUCK Mastercard. uBUCK and Datable will share transaction fee revenue from the convenience fees charged for uBUCK pin vouchers and debit card transactions.
“Our core SaaS business is getting stronger each quarter. The first three months of this year ending March 31 we saw a significant increase in deal size (by approximately 23%), about 68% of which were returning customers. Development work on the Company’s Consumer Loyalty and Rewards Portals – the flexxi Rewards Network – continued and we are now in discussions with potential launch partners.” said Robert Craig, DTC’s CEO. “The flexxi Rewards Network will be an important step towards Datable owning its’ own 1st Party Data which we anticipate being a big driver of revenue in the coming years. The flexxi Rewards Network is built on top of Datable’s proprietary PLATFORM³ technology which dramatically reduces costs and time to market.”
Results of Operations:
Revenue for Q1 2019 decreased by 21% to $307,318 compared with the same period in 2018 due to the timing of revenue recognition for license agreements signed in prior periods and in Q1 2019.The Company’s PLATFORM³ product is an integrated suite of digital marketing applications sold as SaaS for short-term promotions or on an annual subscription basis with recurring revenues. Revenue in the year reflected recognition of revenue from previous year contracts and new sales of the PLATFORM³ product offering.
Gross margin as a percentage of revenue for Q1 2019 was 72%, compared to 72% in Q1 2018. Gross margin as a percentage of revenue depends on the product mix for the reporting period. Revenues are comprised of a combination of higher margin sales of PLATFORM³, the Company’s proprietary SaaS product, combined with some lower margin third party services.
DTC launched an API connection to third party digital rewards platforms in prior years. This service enables DTC clients to offer digital rewards such as gift cards, movie tickets and virtual visas to incentivize purchase and purchase frequency. DTC purchases these rewards on behalf of the Company’s clients and charge a transaction fee for the total amount of rewards purchased. Cost of sales also includes the cost of servers to host PLATFORM³, and project management and customer support staff.
General and administrative expenses for the three months ended March 31, 2019 decreased by 4% to $249,954 compared to the same period in 2018. General and administrative expenses include salaries and benefits, accounting, legal, corporate finance services, travel, rent, office, other administrative costs.
Research and development expenditures for the three months ended March 31, 2019 increased by 23% to $171,853 compared to the same period in 2018. The increase in research and development expenses was related to improving PLATFORM³ and developing flexxi. Research and development expenses may continue to increase in the future as the Company seeks to evolve and improve PLATFORM³ and flexxi, as well as to invest in creating new technology and products that will enhance the Company’s value proposition to customers and provide additional revenues. Research and development expenses include wages and salaries and consulting fees.
Net and comprehensive loss for the three months ended March 31, 2019 was $389,650 compared to $712,380 for the same period in 2018. This decrease in net loss was mainly due to the decrease of share-based compensation, sales and marketing expenses and gross profit, net of the increase of research and development spending.
For further information, please contact:
Datable Technology Corp.
Chief Executive Officer
About Datable Technology Corp.
DTC has developed a proprietary, mobile-based consumer marketing platform – PLATFORM³ – that is sold to global Consumer Packaged Goods (CPG) companies and consumer brands. PLATFORM³ is delivered as a subscription service (Software as a Service model) and used by CPG companies to engage consumers, reward purchases and collect valuable consumer data. PLATFORM³ incorporates Artificial Intelligence and Machine Learning to monetize the consumer data, including demographics and purchasing behaviour, by sending consumers targeted offers by email and text messages. For more information, visit datablecorp.com.
For additional information about the company please visit www.sedar.com. The TSX Venture Exchange Inc. has in no way passed upon the merits of the transaction and has neither approved nor disapproved the contents of this press release. Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. This news release contains forward-looking information, which involves known and unknown risks, uncertainties and other factors that may cause actual events to differ materially from current expectation. Important factors – including the availability of funds and the results of financing efforts, – that could cause actual results to differ materially from the Company’s expectations are disclosed in the Company’s documents filed from time to time on SEDAR (see www.sedar.com). Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company disclaims any intention or obligation, except to the extent required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.