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PHOENIX, Ariz. — VIQ Solutions Inc. (“VIQ” or the “Firm”) (TSX and Nasdaq: VQS), a worldwide supplier of safe, AI-driven, digital voice and video seize expertise and transcription providers, at the moment publicizes its unaudited monetary outcomes for the second quarter ending June 30, 2023. Outcomes are reported in US {dollars} and ready in accordance with Worldwide Monetary Reporting Requirements (“IFRS”).
“Income for the second quarter ending June 30, 2023, grew by 5% sequentially from the earlier quarter regardless of some delays in ramping up of latest contracts. When normalized to think about the 50% discount of the Queensland contract from a 12 months in the past and adverse international trade influence as a result of declining Australian greenback and British pound sterling relative to the US greenback, revenues for the quarter would have elevated by up by 3.6% 12 months over 12 months. We’re pleased to report that our purchasers seem like again on monitor to course of evidentiary documentation to pre-COVID volumes after a troublesome couple of years in 2021 and 2022 as a result of pandemic and labor shortages.
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“The Firm’s sturdy bookings, consumer renewals, present consumer quantity traits mixed with beforehand introduced restructuring and the continued platform migrations in our Australian enterprise are anticipated to yield good points in gross margins to assist a path to constructive adjusted EBITDA within the second half of 2023,” mentioned Sebastien Paré, VIQ’s Chief Govt Officer.
Second Quarter 2023 Operational Highlights
- As of June 30, 2023, a report was set for web new natural bookings of $8.9 million 1 within the final twelve months.
- Delays in ramp-ups of latest clients mixed with capability challenges that created supply backlogs in our first quarter and first a part of our second quarter of 2023 have been resolved.
- Volumes throughout each area and each vertical, volumes in June and July have now normalized enabling the Firm to renew scalability.
- Two patent functions had been submitted, which is able to increase our speech engine agnostic workflows, bettering documentation accuracy and usefulness of documentation.
- First insurance coverage company with VIQ’s AI-powered FirstDraft™ expertise in lieu of conventional transcription is now operational.
- A brand new partnership with JAVS that’s anticipated to drive the growth of VIQ’s expertise into courtrooms, offering automated draft transcripts of courtroom proceedings.
- 2023 Fortress Cyber Safety winner within the Knowledge Safety class validates the Firm’s dedication to information safety.
“After a three-month trial, one of many largest US insurance coverage firms made the choice to not solely pivot to using our FirstDraft expertise to assist their recorded statements, however in addition they dedicated to sole supply this contract to VIQ,” mentioned Susan Sumner, VIQ’s President and Chief Working Officer. “Day-after-day we see validation that the expertise we’ve got constructed is producing a extremely usable doc for consumption by industrial purchasers or to enhance the productiveness of our inside ProEdit answer. The worth of our workflow answer, NetScribe™ is confirmed by our newest value reductions that are a results of the consolidation of assets tied to this implausible platform.”
Second Quarter 2023 Monetary Highlights
- Income of $10.5 million, a lower of $1.8 million, or 15%, in comparison with the identical interval of the prior 12 months, was primarily as a result of anticipated change within the Queensland contract. For the three months ended June 30, 2023, income was additionally negatively impacted by roughly $0.5 million as a result of weakening Australian greenback and British pound sterling compared to the US Greenback. Excluding the Queensland contract change and influence of international trade, the Firm would have reported a constructive income progress of three.6% versus the three months interval ended June 30, 2022.
- Gross revenue was $4.6 million, or 44.1% of income, in comparison with $6 million, or 49.3% of income throughout the identical interval of the prior 12 months. The lower in gross margin was primarily as a result of anticipated discount within the excessive margin Queensland contract. Moreover, for the three months ended June 30, 2023, income was negatively impacted by roughly $0.5 million as a result of weakening Australia greenback and British pound sterling compared to the US greenback. Excluding the Queensland contract change and influence of international trade, the Firm would have reported a constructive present quarter over prior 12 months quarter gross margin progress of 0.7%
- Internet lack of $3.6 million, or $0.10 per diluted share, versus web lack of $3.2 million, or $0.11 per diluted share in the identical prior 12 months interval.
- Adjusted EBITDA1 deficit of $0.9 million, versus Adjusted EBITDA deficit of $0.7 million in the identical interval within the prior 12 months. The rise in Adjusted EBITDA deficit was primarily as a result of decreased gross revenue, on account of the anticipated change within the Queensland contract and the adverse influence of international trade, partially offset by decreased promoting and administrative bills.
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‘We proceed to align our international assets to evolve right into a leaner, extra information pushed firm, with plans to optimize our workforce and restructure sure positions to enhance our working efficiency and Adjusted EBITDA,” mentioned Alexie Edwards, VIQ’s Chief Monetary Officer. “In July 2023 we drew $1 million from our debt facility which shall be utilized to fund the optimization of our workforce and for working capital. We additionally accomplished a $1.8 million personal placement providing to fund area particular AI fashions, product growth and basic working capital functions to catalyze the subsequent stage of progress.”
VIQ additionally publicizes at the moment that Christine Fellowes has resigned from the board of administrators of the Firm efficient August 14, 2023. The Firm needs her success and is appreciative of her contributions throughout her appointment as a director at VIQ.
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1 Represents a non-IFRS measure. These measures should not acknowledged measures below IFRS, wouldn’t have a standardized which means prescribed by IFRS and are subsequently unlikely to be corresponding to related measures introduced by different firms. Administration believes non-IFRS measures, together with Adjusted EBITDA, present supplementary data to IFRS measures utilized in assessing the efficiency of the Firm’s enterprise. Please consult with the “Non-IFRS Measures” part under and the reconciliations of the non-IFRS monetary measures to their most straight comparable IFRS monetary measures within the tables on the finish of this press launch |
Convention Name Particulars
VIQ will host a convention name and webcast to debate its second quarter 2023 monetary outcomes on Tuesday, August 15, 2023, at 11:00 a.m. (Japanese Time). The decision will encompass updates by Sebastien Paré, VIQ’s Chief Govt Officer, Sandy Keung, VIQ’s Finance Vice President, and Susan Sumner, VIQ’s President and Chief Working Officer, adopted by a question-and-answer interval.
Traders might entry a stay webcast of the decision on the Firm’s web site at www.viqsolutions.com/investors or by dialing 1-888-440-4052 (North America toll-free) or +1-646-960-0827 (worldwide) to be related to the decision by an operator utilizing convention ID quantity 4983233. Members ought to dial in at the very least 10 minutes previous to the beginning of the decision.
A replay of the webcast shall be accessible on the Firm’s web site by means of the identical hyperlink roughly one hour after the convention name concludes.
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For extra details about VIQ, please go to viqsolutions.com.
About VIQ Options
VIQ Options is a worldwide supplier of safe, AI-driven, digital voice and video seize expertise and transcription providers. VIQ provides a seamless, complete answer suite that delivers clever automation, enhanced with human evaluate, to drive transformation in the best way content material is captured, secured, and repurposed into actionable data. The cyber-secure, AI expertise and providers platform are applied in essentially the most inflexible safety environments together with legal justice, authorized, insurance coverage, authorities, company finance, media, and transcription service supplier markets, enabling them to enhance the standard and accessibility of proof, to simply determine predictive insights and to realize digital transformation sooner and at a decrease value.
Ahead-looking Statements
Sure statements included on this press launch represent forward-looking statements or forward-looking data (collectively, “forward-looking statements”) below relevant securities laws. Such forward-looking statements or data are offered for the aim of offering details about administration’s present expectations and plans referring to the long run. Readers are cautioned that reliance on such data will not be acceptable for different functions.
Ahead-looking statements (usually comprise statements with phrases similar to “anticipate”, “consider”, “count on”, “plan”, “intend”, “estimate”, “suggest”, “venture” or related phrases, together with negatives thereof, suggesting future outcomes or that sure occasions or situations “might” or “will” happen). These statements are solely predictions. Ahead-looking statements on this press launch embrace however should not restricted to statements with respect to the Firm’s path to return to constructive Adjusted EBITDA, EDBITDA within the second half of 2023, the advantages of the Firm’s patent functions, the advantages of the Firm’s new partnership with JAVS, workforce optimization and the convention name to debate the Firm’s second quarter 2023 outcomes.
Ahead-looking statements are based mostly on a number of elements and assumptions which have been used to develop such statements, however which can show to be incorrect. Though VIQ believes that the expectations mirrored in such forward-looking statements are cheap, undue reliance shouldn’t be positioned on forward-looking statements as a result of VIQ can provide no assurance that such expectations will show to be right. Along with different elements and assumptions which can be recognized on this press launch, assumptions have been made relating to, amongst different issues, current initiatives, value financial savings from workforce optimization, value reductions from the Firm’s workflow options and that gross sales and prospects might enhance income. Readers are cautioned that the foregoing record will not be exhaustive of all elements and assumptions which were used.
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Ahead-looking statements are essentially based mostly on plenty of opinions, assumptions and estimates that whereas thought of cheap by the Firm as of the date of this press launch, are topic to recognized and unknown dangers, uncertainties, assumptions and different elements which will trigger the precise outcomes, stage of exercise, efficiency or achievements to be materially completely different from these expressed or implied by such forward-looking statements, together with however not restricted to the elements described in higher element within the “Threat Components” part of the Firm’s annual report and within the Firm’s different supplies filed with the Canadian securities regulatory authorities and the U.S. Securities and Alternate Fee now and again, accessible at www.sedarplus.com and www.sec.gov, respectively.
These elements should not meant to signify an entire record of the elements that might have an effect on the Firm; nevertheless, these elements needs to be thought of rigorously. Such estimates and assumptions might show to be incorrect or overstated. The forward-looking statements contained on this press launch are made as of the date of this press launch and the Firm expressly disclaims any obligations to replace or alter such statements or the elements or assumptions underlying them, whether or not on account of new data, future occasions or in any other case, besides as required by regulation.
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VIQ Options Inc. Consolidated Statements of Monetary Place (Expressed in United States {dollars}, Unaudited) |
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June 30, 2023 |
December 31, 2022 |
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Belongings |
||||||
|
Present property |
||||||
|
Money |
$ |
1,792,375 |
$ |
1,657,571 |
||
|
Commerce and different receivables, web of allowance for uncertain accounts |
5,131,223 |
5,305,728 |
||||
|
Revenue tax recoverable |
32,260 |
104,670 |
||||
|
Inventories |
32,452 |
37,807 |
||||
|
Different present property |
1,962,674 |
2,050,661 |
||||
|
Non-current property |
8,950,984 |
9,156,437 |
||||
|
Restricted money |
253,445 |
463,743 |
||||
|
Property and gear |
1,210,891 |
1,432,133 |
||||
|
Proper-of-use property, web |
737,236 |
1,058,600 |
||||
|
Intangible property, web |
9,182,836 |
10,731,917 |
||||
|
Goodwill |
11,945,991 |
12,047,048 |
||||
|
Deferred tax property |
582,246 |
655,004 |
||||
|
Complete property |
$ |
32,863,629 |
$ |
35,544,882 |
||
|
Liabilities |
||||||
|
Present liabilities |
||||||
|
Commerce and different payables and accrued liabilities |
$ |
7,109,734 |
$ |
5,937,880 |
||
|
Revenue tax payable |
17,791 |
45,212 |
||||
|
Share-based cost legal responsibility |
46,112 |
31,487 |
||||
|
By-product warrant legal responsibility |
428,641 |
290,712 |
||||
|
Present portion of long-term debt |
351,889 |
8,634,258 |
||||
|
Present portion of lease obligations |
354,914 |
487,673 |
||||
|
Contract liabilities |
1,671,936 |
1,745,415 |
||||
|
Non-current liabilities |
9,9981,017 |
17,172,637 |
||||
|
Deferred tax legal responsibility |
240,163 |
868,643 |
||||
|
Lengthy-term debt |
9,368,861 |
19,812 |
||||
|
Lengthy-term lease obligations |
501,755 |
718,575 |
||||
|
Different long-term liabilities |
1,012,247 |
1,121,805 |
||||
|
Complete liabilities |
21,104,043 |
19,901,472 |
||||
|
Shareholders’ Fairness |
||||||
|
Capital inventory |
74,764,440 |
74,690,527 |
||||
|
Contributed surplus |
8,534,110 |
5,892,192 |
||||
|
Accrued different complete revenue (loss) |
(796,165 |
) |
(1,214,354 |
) |
||
|
Deficit |
(70,742,799 |
) |
(63,724,955 |
) |
||
|
Complete shareholders’ fairness |
11,759,586 |
15,643,410 |
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|
Complete liabilities and shareholders’ fairness |
$ |
32,863,629 |
$ |
35,544,882 |
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VIQ Options Inc. Consolidated Statements of Loss and Complete Loss (Expressed in United States {dollars}, Unaudited) |
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Three months ended June 30 |
Six months ended June 30 |
|||||||||||
|
2023 |
2022 |
2023 |
2022 |
|||||||||
|
Income |
$ |
10,518,893 |
$ |
12,351,655 |
$ |
20,571,464 |
$ |
23,876,636 |
||||
|
Value of Gross sales |
5,884,012 |
6,257,453 |
11,508,626 |
12,293,385 |
||||||||
|
Gross Revenue |
4,634,881 |
6,094,202 |
9,062,838 |
11,583,251 |
||||||||
|
Bills |
||||||||||||
|
Promoting and administrative bills |
5,405,644 |
6,532,440 |
10,766,945 |
12,668,748 |
||||||||
|
Analysis and growth bills |
189,156 |
278,357 |
333,965 |
477,442 |
||||||||
|
Inventory based mostly compensation |
504,835 |
540,580 |
838,127 |
1,492,776 |
||||||||
|
Achieve on revaluation of choices |
– |
(355,215 |
) |
– |
(1,063,662 |
) |
||||||
|
Achieve on revaluation of RSUs |
(63,042 |
) |
(134,205 |
) |
(119,988 |
) |
(308,458 |
) |
||||
|
(Achieve) loss on revaluation of the by-product warrant legal responsibility |
(24,238 |
) |
(159,964 |
) |
134,514 |
(1,046,780 |
) |
|||||
|
International trade loss |
409,270 |
489,803 |
646,288 |
748,563 |
||||||||
|
Depreciation |
183,396 |
139,853 |
409,555 |
275,567 |
||||||||
|
Amortization |
1,305,671 |
1,079,784 |
2,435,974 |
2,103,414 |
||||||||
|
Curiosity expense |
319,256 |
241,128 |
653,092 |
580,841 |
||||||||
|
Accretion and different financing prices |
240,570 |
156,307 |
404,286 |
289,280 |
||||||||
|
(Achieve) loss on contingent consideration |
– |
(7,489 |
) |
(10,389 |
) |
96,072 |
||||||
|
Impairment of goodwill and intangible property |
– |
157,464 |
– |
|||||||||
|
Restructuring prices |
29,454 |
154,727 |
56,866 |
169,108 |
||||||||
|
Enterprise acquisition prices |
– |
374,053 |
– |
395,517 |
||||||||
|
Different revenue |
(4,313 |
) |
(120 |
) |
(9,407 |
) |
(729 |
) |
||||
|
Complete bills |
8,495,659 |
9,330,039 |
16,697,292 |
16,877,699 |
||||||||
|
Present revenue tax (restoration) expense |
(47,453 |
) |
110,135 |
(40,091 |
) |
172,642 |
||||||
|
Deferred revenue tax restoration |
(255,162 |
) |
(147,834 |
) |
(576,519 |
) |
(259,037 |
) |
||||
|
Revenue tax restoration |
(302,615 |
) |
(37,699 |
) |
(616,610 |
) |
(86,395 |
) |
||||
|
Internet loss for the interval |
$ |
(3,558,163 |
) |
$ |
(3,198,138 |
) |
$ |
(7,017,844 |
) |
$ |
(5,208,053 |
) |
|
Alternate achieve (loss) on translation of international operations |
405,841 |
(449,303 |
) |
418,189 |
(36,505 |
) |
||||||
|
Complete loss for the interval |
$ |
(3,152,322 |
) |
$ |
(3,647,441 |
) |
$ |
(6,599,655 |
) |
$ |
(5,244,558 |
) |
|
Internet loss per share |
||||||||||||
|
Primary |
(0.10 |
) |
(0.11 |
) |
(0.20 |
) |
(0.17 |
) |
||||
|
Diluted |
(0.10 |
) |
(0.11 |
) |
(0.20 |
) |
(0.17 |
) |
||||
|
Weighted common variety of widespread shares excellent – fundamental |
34,804,004 |
28,653,056 |
34,693,176 |
29,890,785 |
||||||||
|
Weighted common variety of widespread shares excellent – diluted |
34,804,004 |
28,653,056 |
34,693,176 |
29,890,785 |
||||||||
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VIQ Options Inc. Reconciliation of Non-IFRS Measures (Expressed in United States {dollars}) (Unaudited) |
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The next is a reconciliation of Internet Loss to Adjusted EBITDA, essentially the most straight comparable IFRS measure for the three and 6 months ended June 30, 2023, and 2022: |
|||||||||||||
|
Three months ended |
Six months ended |
||||||||||||
|
(Unaudited) |
2023 |
2022 |
2023 |
2022 |
|||||||||
|
Internet Loss |
$ |
(3,558,163 |
) |
$ |
(3,198,137 |
) |
$ |
(7,017,844 |
) |
$ |
(5,208,053 |
) |
|
|
Add: |
|||||||||||||
|
Depreciation |
183,396 |
139,853 |
409,555 |
275,567 |
|||||||||
|
Amortization |
1,305,671 |
1,079,784 |
2,435,974 |
2,103,414 |
|||||||||
|
Curiosity expense |
319,256 |
241,128 |
653,092 |
580,841 |
|||||||||
|
Present revenue tax (restoration) expense |
(47,453 |
) |
110,135 |
(40,091 |
) |
172,642 |
|||||||
|
Deferred revenue tax restoration |
(255,162 |
) |
(147,834 |
) |
(576,519 |
) |
(259,037 |
) |
|||||
|
EBITDA |
(2,052,455 |
) |
(1,775,071 |
) |
(4,135,833 |
) |
(2,334,626 |
) |
|||||
|
Accretion and different financing prices |
240,570 |
156,307 |
404,286 |
289,280 |
|||||||||
|
Achieve on revaluation of choices |
– |
(355,215 |
) |
– |
(1,063,662 |
) |
|||||||
|
Achieve on revaluation of RSUs |
(63,042 |
) |
(134,205 |
) |
(119,988 |
) |
(308,458 |
) |
|||||
|
(Achieve) loss on revaluation of the by-product warrant legal responsibility |
(24,238 |
) |
(159,964 |
) |
134,514 |
(1,046,780 |
) |
||||||
|
Impairment of goodwill and intangible property |
– |
– |
157,464 |
– |
|||||||||
|
Restructuring prices |
29,454 |
154,727 |
56,866 |
169,108 |
|||||||||
|
Enterprise acquisition prices |
– |
374,053 |
– |
395,517 |
|||||||||
|
Different Revenue |
(4,313 |
) |
(120 |
) |
(9,407 |
) |
(729 |
) |
|||||
|
Inventory-based compensation |
504,835 |
540,580 |
838,127 |
1,492,776 |
|||||||||
|
International trade loss |
409,270 |
489,803 |
646,288 |
748,563 |
|||||||||
|
Adjusted EBITDA |
$ |
(959,919 |
) |
$ |
(709,105 |
) |
$ |
(2,027,683 |
) |
$ |
1,659,011 |
) |
|
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Non-IFRS Measures
The Firm prepares its monetary statements in accordance with IFRS. Non-IFRS measures are offered by administration to supply extra perception into our efficiency and monetary situation. VIQ believes non-IFRS measures are an vital a part of the monetary reporting course of and are helpful in speaking data that enhances and dietary supplements the consolidated monetary statements. Adjusted EBITDA and bookings should not measures acknowledged by IFRS and wouldn’t have standardized meanings prescribed by IFRS. Due to this fact, Adjusted EBITDA and Bookings will not be corresponding to related measures introduced by different issuers. Traders are cautioned that Adjusted EBITDA shouldn’t be construed as a substitute for web revenue (loss) as decided in accordance with IFRS.
To judge the Firm’s working efficiency as a complement to outcomes offered in accordance with IFRS, the time period “Adjusted EBITDA” refers to web revenue (loss) earlier than adjusting earnings for stock-based compensation, depreciation, amortization, curiosity expense, accretion and different financing expense, (achieve) loss on revaluation of choices, (achieve) loss on revaluation of restricted share items, achieve (loss) on revaluation of by-product warrant legal responsibility, restructuring prices, (achieve) loss on revaluation of conversion function legal responsibility, loss on compensation of long-term debt, enterprise acquisition prices, impairment of goodwill and intangibles, different expense (revenue), international trade (achieve) loss, present and deferred revenue tax expense. We consider that the gadgets excluded from Adjusted EBITDA should not related to and don’t signify the working efficiency of the Firm.
We consider that Adjusted EBITDA is beneficial supplemental data because it supplies a sign of the outcomes generated by the Firm’s primary enterprise actions previous to bearing in mind how these actions are financed and taxed in addition to bills associated to stock-based compensation, depreciation, amortization, impairment of goodwill and intangibles, different expense (revenue), and international trade (achieve) loss. Accordingly, we consider that this measure may additionally be helpful to buyers in enhancing their understanding of the Firm’s working efficiency.
We calculate “Bookings” for a given interval because the estimated contract worth (for providers tied to quantity) of our recurring consumer contracts entered into throughout the interval from (i) new purchasers and (ii) web upgrades by current purchasers throughout the similar workload, plus the precise (not annualized) estimated worth {of professional} providers consulting, advisory or project-based orders obtained, software program licenses, subscriptions, SaaS, and {hardware} throughout the interval. Recurring consumer contracts are any contracts entered into on a multi-year or month-to-month foundation, however excluding any skilled providers contracts for consulting, advisory or project-based work, software program license and {hardware}.
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We use Bookings to measure the quantity of latest enterprise generated in a interval, which we consider is a crucial indicator of latest consumer acquisition and our capacity to cross-sell new providers to current purchasers. Bookings are additionally utilized by administration as a think about figuring out performance-based compensation for our gross sales power. Whereas we consider Bookings, together with different metrics, are an indicator of our near-term future income alternative, it isn’t meant for use as a projection of future income. Reserving data is a non-IFRS measure, which includes judgments, estimates and assumptions, which doesn’t have a typical trade definition. Our calculation of Bookings might differ from equally titled metrics introduced by different firms.
Emblems
This press launch consists of emblems, similar to “NetScribe” and “FirstDraft”, that are protected below relevant mental property legal guidelines and are the property of VIQ. Solely for comfort, our emblems referred to on this press launch might seem with out the ® or TM image, however such references should not meant to point, in any method, that we are going to not assert our rights to those emblems, commerce names and providers marks to the fullest extent below relevant regulation. Emblems which can be used on this press launch, aside from those who belong to VIQ, are the property of their respective house owners.
View supply model on businesswire.com: https://www.businesswire.com/news/home/20230814662149/en/
Contacts
Media:
Laura Haggard
Chief Advertising Officer
VIQ Options
Telephone: (800) 263-9947
E-mail: marketing@viqsolutions.com
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