ProntoForms Corporation

TSX VENTURE : PFM


March 18, 2014 16:05 ET

ProntoForms Corporation Announces Annual and Q4 2013 Results

OTTAWA, ONTARIO--(Marketwired - March 18, 2014) - ProntoForms® Corporation (TSX VENTURE:PFM) -

Highlights:

  • FY13 total revenue of $4,363,027, an increase of 75% over 2012
  • FY13 recurring revenue of $3,418,819, an increase of 78% over 2012
  • Q413 total revenue of $1,365,851, an increase of 94% over comparable fourth quarter in 2012
  • Q413 recurring revenue of $1,005,754, an increase of 67% over comparable fourth quarter in 2012

ProntoForms® Corporation ("ProntoForms" or "the Company"), a mobile data solutions company, today announced results for its fourth quarter and its fiscal year ended 2013. All amounts are stated in Canadian dollars unless otherwise noted.

Alvaro Pombo, Chief Executive Officer, ProntoForms, said, "As expected, we had rapid growth of the company and the subscriber base. The company acquired a growing number of Fortune 100 customers. I am pleased with the ongoing confidence of our partners, who continue to expand their investment into our product and company. Also, for the past two years, we have established a trend of strong revenue growth combined with steadily decreasing operating losses. ProntoForms has been recognized by industry analysts like Frost & Sullivan as the leader in the Mobile Forms product category - a market they measure at 22M subscribers for North America."

Operating Results for the Three Months Ended December 31, 2013

Total revenue for the fourth quarter of 2013 of $1,365,851 represented an increase of approximately 18.9% over the 2013 third quarter and 93.9% growth over the comparable fourth quarter of 2012.
Revenue details are as follows:

Three months ended Increase Increase
December
31, 2013
September
30, 2013
December
31, 2012
Over
Q313
Over
Q412
Recurring revenue
Subscription 986,342 874,990 585,490 12.7% 68.5%
Maintenance 19,412 17,350 17,547 11.9% 10.6%
1,005,754 892,340 603,037 12.7% 66.8%
Professional and other services 360,097 256,771 101,467 40.2% 254.9%
Total revenue $ 1,365,851 $ 1,149,111 $ 704,504 18.9% 93.9%

Recurring revenue of $1,005,754 grew by 12.7% from the third quarter of 2013 and by 66.8% from the comparable fourth quarter of 2012. Within recurring revenue, subscription revenue grew by 12.7% from the third quarter of 2013 and by 68.5% from the comparable fourth quarter of 2012. Subscription revenue from operator channels increased from $542,934 in the third quarter of 2013 to $632,732 in the fourth quarter of 2013, representing growth of 16.5% and 72.2% growth over the 2012 fourth quarter operator subscription revenue of $367,413.

Professional and other services revenue of $360,097 grew by 40.2% from the third quarter of 2013 and by 254.9% from the comparable fourth quarter of 2012. The 2013 fourth quarter professional services revenue included approximately $280,000 from large contracts with major operators and smartphone vendors compared to approximately $201,000 in the 2013 third quarter and $90,000 in the fourth quarter of 2012. Revenue from these larger contracts is recognized as the services are performed and is subject to variability due to the availability of contracts from customers and resources to perform the work.

Loss from operations for the fourth quarter of 2013 was $64,392 compared to $142,667 in the third quarter of 2013, representing an improvement of $78,275 or 55% and an improvement of $311,472 or 83% over the operating loss of $375,864 in the fourth quarter of 2012.

The Company had a Q4 2013 net loss of $303,112 compared to a Q3 2013 net loss of $237,208 and a comparable Q4 2012 net loss of $378,051. In the fourth quarter of 2013, the Company incurred interest and accretion of $38,986 and changes in the fair value of a derivative liability of $236,265 all relating to the BDC loan that was secured in November 2012. The large increase in the fair value of the derivative liability relates primarily to the increase in valuation for the bonus obligation in the event of a sale of the Company.

As at December 31, 2013, the Company had cash and cash equivalents of $896,234 and net working capital of $808,160.

Operating Results for the Year Ended December 31, 2013

Revenue for the year ended December 31, 2013 was $4,363,027 compared to $2,487,898 for the year ended December 31, 2012, representing an increase of 75%. Revenue details are as follows:

Year ended
December
31, 2013
December
31, 2012
Incrase
Over
Previous
Year
Recurring revenue
Subscription 3,347,310 1,856,400 80.3%
Maintenance 71,509 69,842 2.4%
3,418,819 1,926,242 77.5%
Other services revenue 944,208 561,656 68.1%
Total revenue $ 4,363,027 $ 2,487,898 75.4%

Recurring revenue for the year ended December 31, 2013, was $3,418,819 compared to $1,926,242 in 2012, representing an increase of 78%. Within recurring revenue, subscription revenue grew by 80.3% from 2012. Other services revenue was $944,208 in 2013 compared to $561,656 in 2012, representing an increase of 68%.
The Company had a loss from operations of $859,882 compared to a loss from operations in 2012 of $1,944,301. The improvement in loss from operations relates to an increase in revenue of 75% combined with only an 18% increase in operating expenses.

The Company had a net loss of $361,288 compared to a net loss in 2012 of $1,981,107. In 2013, the Company had other income of approximately $875,000 related to the sale of certain patents and a reduction in deferred revenue due to the reversal of the underlying obligation. The other income items are one-time events and will not impact future period. The Company also had interest and accretion of $143,948 and changes in the fair value of a derivative liability of $303,825 all relating to the BDC loan that was secured in November 2012.

Mr. Pombo added: "We're optimistic about 2014; we have a seasoned management team and strong business partnerships with global device brands and tier one carriers. Additionally, we have a proven product and a demonstrated growth strategy. This year is all about building on this solid foundation."

About ProntoForms® and ProntoForms Corporation

ProntoForms is a mobile workflow solution used by over 2,500 business customers to collect, receive and submit data in the field. Available for smartphones and tablets, the ProntoForms solution incorporates a mobile device App, a Web portal to manage teams and data flow, and provides the ability to export or connect data to the back office, popular cloud services or other data destinations. ProntoForms is the Frost & Sullivan winner of the North American Customer Value Leadership Award for Mobile Forms.

ProntoForms Corporation has a powerful and proprietary patent portfolio, from which the ProntoForms mobile App and Web reporting portal have been developed. The company trades on the TSXV under the symbol PFM. ProntoForms is the registered trademark of ProntoForms Inc., a wholly-owned subsidiary of ProntoForms Corporation. www.prontoforms.com

Certain information in this press release may constitute forward-looking information. For example, statements about the Company's future growth or value are forward-looking information. This information is based on current expectations that are subject to significant risks and uncertainties that are difficult to predict. Actual results might differ materially from results suggested in any forward-looking statements. The Company 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 unless and until required by securities laws applicable to the Company. Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.

There are a number of risk factors that could cause future results to differ materially from those described herein, including but not limited to the following: (i) there can be no assurance that the Company will earn any profits in the future or that profitability, if achieved, will be sustained; (ii) if the Company is not able to achieve profitability, it will require additional equity or debt financing, and there can be no assurances that the Company will be able to obtain additional financial resources on favourable commercial terms or at all; (iii) the Company's quarterly revenues and operating results may fluctuate, which may harm its results of operations; (iv) the loss of business from a major customer, operator or other reseller could reduce the Company's sales and harm its business and prospects; (v) a portion of the Company's sales are through operators and other resellers, and an adverse change in the Company's relationship with any of such operators or other resellers may result in decreased sales; (vi) the market for software as a service is at a relatively early stage of development, and if it does not develop or develops more slowly than expected, the Company's business will be harmed; (vii) the Company faces competition from other software solution providers, which may reduce its market share or limit the prices it can charge for its software solutions; (viii) a global economic downturn or market volatility may adversely affect our business and/or our ability to complete new financings; (ix) the business of the Company may be harmed if it does not continue to penetrate markets; (x) the success of the business depends on the Company's ability to develop new products and enhance its existing products; (xi) the Company's growth depends in part on the success of its strategic relationships with third parties;
(xii) the financial condition of third parties may adversely affect the Company; (xiii) the US dollar may fluctuate significantly compared to the Canadian dollar, causing reduced revenue and cash flow as most of our revenues are received in US dollars while most of our expenses are payable in Canadian dollars; (xiv) subscription services which produce the majority of the Company's revenue are hosted by a third party service for the Company and any interruption in service could harm its results of operations; (xv) the Company may be liable to its customers or third parties if it is unable to collect data or it otherwise loses data; (xvi) the Company may be liable for the handling of personal information; (xvii) intellectual property claims against the Company may be time consuming, costly to defend, and disruptive to the business; (xviii) the Company uses open source software in connection with its products which exposes it to uncertainty and potential liability; (xix) economic uncertainty and downturns in the software market may lead to decreases in the Company's revenue and margins; (xx) any significant changes in the technological paradigm utilized for building or delivering applications in Smartphone devices could harm the Company's business and prospects; and (xxi) if the Company loses any of its key personnel, its operations and business may suffer. Please see "Risk Factors Affecting Future Results" in the Company's annual management discussion and analysis dated March 12, 2014 found at www.sedar.com for a more complete discussion of these and other risks. Readers are cautioned not to place undue reliance on forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

Contact Information