GuestLogix Inc.

TSX : GXI


GuestLogix Inc.

May 12, 2014 16:00 ET

GuestLogix Reports Q1 Results as it Continues Quarter Over Quarter Growth Momentum

Company Delivers 22% Year-over-Year Revenue Growth While Largest Deployment Backlog in Company's History Begins to Rollout

TORONTO, ONTARIO--(Marketwired - May 12, 2014) - GuestLogix Inc. (TSX:GXI), the leading global provider of onboard retail and payment technology to airlines and the passenger travel industry, today announced its financial and operational results for the three-month period ended March 31, 2014. All financial statements are prepared in accordance with International Financial Reporting Standards ("IFRS") and reported in U.S. dollars.

"We are proud to report another record revenue quarter to start off 2014, with a 22% increase in our revenue performance compared to the same quarter in the previous year," said Brett Proud, President & CEO GuestLogix. "When excluding certain restructuring costs in the quarter, the Company delivered an adjusted EBITDA result of $0.4 million and saw significant improvement in our Net Income line quarter over quarter. With the current size of our deployment backlog, I am confident this growth momentum will rapidly accelerate as we go live with more customers over the next two quarters."

Q1 F2014 Financial Summary

  • Revenue of $8.5 million, compared to $7.0 million in Q1 F2013.
  • Operating Expenses of $4.7 million, compared to $4.6 million in Q1 F2013.
  • Adjusted EBITDA(1) of $147 thousand, compared to $267 thousand in Q1 F2013.
  • Net loss of $(0.7) million, compared to a net loss of $(1.6) million in Q1 F2013.
  • Cash of $9.1 million as at March 31, 2014, and with $4 million in available lines of credit, total cash resources of $13.1 million.

Proud continued, "Within the quarter, we had several major customer and partner signings representing our technology being used at both multiple touch points and access points throughout the travel journey. With success in all three geographic regions, as well as with our global rail division, we continue to see high market demand as we expand our reach to powering ancillary revenue at all stages of the travel journey."

Proud added, "In addition, we continue to see our investments in the Asia Pacific region, and especially in Mainland China, paying off in revenue growth."

Subsequent to quarter end, the Company announced the availability of its global payment processing technologies - including the Transaction Processing Engine®, Global Payment Gateway™ and 82 associated Global Certifications - in the cloud. These cloud-based offerings will provide global access and increased speed of implementation of GuestLogix' payment technologies and are in support of Common Use Transaction Processing™ (CUTP™) standards for ancillary revenue transactions. All payment providers should adhere to CUTP™ standards when processing ancillary revenue for the global passenger travel industry.

Q1 F2014 Operational Highlights

Increasing the Number of Transactions that we process

  • Signed multi-year agreement with major European rail operator to deploy mobile ticketing and retail solution
  • Signed renewal agreement with leading North American airline
  • Signed multi-year agreement with Norwegian Air Shuttle in partnership with Northern Europe's leading tax-free and travel retail provider, Inflight Services Europe AB
  • Signed multi-year partnership with leading in-flight connectivity company, Global Eagle, to provide destination content and transaction processing services throughout their global customer base
  • Signed multi-year agreement to deploy onboard retail technology across Europe's largest regional airline, Flybe, in partnership with Skytrac Group
  • Subsequent to quarter end, signed 3-year partnership with world's leading provider of global airport lounge access, Priority Travel Group, for membership verification and retail solution
  • Subsequent to quarter end, signed multi-year agreement with Japanese airline through partnership with Inflight Sales Group
  • Subsequent to quarter end, signed multi-year agreement with Southeast Asian airline through partnership with Inflight Sales Group

Increasing the Average Transaction Value

  • Agreement with European rail operator focuses on core ticket sales which has a higher average transaction value than traditional food and beverage purchases onboard
  • Agreement with Global Eagle focuses on destination-based content which has a higher average transaction value than both food and beverage and duty-free purchases onboard
  • Agreement with Priority Travel Group focuses on lounge guest passes which has a higher average transaction value than traditional food and beverage purchases onboard

Earning More Fees per Transaction

  • Renewal agreement with leading North American airline includes Ancillary Insights™ platform
  • Agreement with Norwegian Air Shuttle includes Ancillary Insights™ platform
  • Agreement with Global Eagle includes Global Payment Gateway™ and Merchant of Record services

Financial Summary

Q1 F2014 Q4 F2013 Q1 F2013
Revenue $ 8.5M $ 8.3M $ 7.0M
Gross Margin $ 4.1M $ 3.6M $ 3.9M
Adjusted EBITDA $ 0.1M $ (0.6M ) $ 0.3M
Net Loss $ (0.7M ) $ (2.0M ) $ (1.6M )
Net Loss Per Share $ (0.01 ) $ (0.03 ) $ (0.02 )

Q1 F2014 Conference Call Details

GuestLogix will host a conference call on Monday, May 12, 2014 at 4:30 p.m. Eastern Time to discuss its fiscal 2014 first quarter financial and operational results as well as the Company's outlook for the remainder of the fiscal year. To access the conference call, please dial 862-255-5351 or 1-888-390-3967. A replay of the call will be available at http://www.guestlogix.com/investors/investor-events/.

A complete set of financial statements and Management's Discussion and Analysis for the three-month period ended March 31, 2014 will be available at www.sedar.com and www.guestlogix.com

(1) Adjusted EBITDA is defined as earnings before interest, taxes, depreciation, amortization, foreign exchange, stock-based compensation and change in fair value of derivative warrant liability.

About GuestLogix

GuestLogix Inc. (TSX:GXI), is a global leader in comprehensive retail solutions delivered to the passenger travel industry, both onboard and off board. Bringing over a decade of expertise as the industry's most trusted onboard transaction processing partner to airlines, rail operators and elsewhere in the passenger travel industry, GuestLogix powers the industry's growing reliance on ancillary revenue generation. Both direct to operators as well as through partnerships with global leaders in catering, duty-free, inflight entertainment and self-service retail experts, the Company provides the payment services touching over 1 billion travelling consumers each year. GuestLogix' global headquarters and centre for product innovation is located in Toronto, with regional head offices located in Dallas, London and Hong Kong. More information is available at www.guestlogix.com.

Forward-Looking Statements

This news release includes certain forward-looking statements that are based upon current expectations, which involve risks and uncertainties associated with GuestLogix' business and the environment in which the business operates. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking, including those identified by the expressions "anticipate", "believe", "plan", "estimate", "expect", "intend", and similar expressions to the extent they relate to the Company or its management. The forward-looking statements are not historical facts, but reflect GuestLogix' current expectations regarding future results or events. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations, including the matters discussed under "Risks and Uncertainties" in the Filing Statement filed on May 12, 2014 with the regulatory authorities. GuestLogix assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward-looking statements.

© 2014 GuestLogix. All Rights Reserved. ®OnTouch is a trademark of GuestLogix Inc. and is registered in the United States and may be pending or registered in other countries. All other trademarks and trade names are the property of their respective owners.

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