GetSwift Reports Fiscal Third Quarter 2022 Financial Results and Provides Update Regarding Australian Legal Proceedings
GetSwift Technologies Limited ("GetSwift" or the "Corporation"; NEO: “GSW”) has reported its financial and operational results for its fiscal third quarter of 2022, which ended March 31, 2022 and is pleased to provide an update with respect to the proceedings in the matter of Australian Securities and Investments Commission v. GetSwift Limited & others Federal Court of Australia VID 146 of 2019 (“the ASIC Proceedings”).
Key Third Quarter and Subsequent Operational Highlights
- The Board of Directors of the Corporation (the “Board”) is continuing its process to identify, examine, and consider funding arrangements that are expected provide the Corporation with sufficient working capital in the short term, and the strategic opportunities available to the Corporation, in order to maximize value for shareholders in the longer term
- Such strategic opportunities may include, but are not limited to, a corporate sale, merger or other business combination, a disposition of all or a portion of the Corporation’s assets, a recapitalization, refinancing of its capital structure, or any combination of the foregoing
- As at March 31, 2022, the Corporation has been considering a definitive plan to sell its technology subscription service (“TSS”) business in the US, which comprises its Software as a Service (SaaS) segment, including its intellectual property, which results in certain assets and liabilities being classified as held for sale and the TSS operations have been disclosed as discontinued operations in the financial statements and related management’s discussion and analysis of the Corporation for the interim period ended March 31, 2022
- Pursuant to a share purchase agreement made on April 14, 2022 (the “Logo Sale Agreement”) between GetSwift Inc. (“GSI”), a wholly owned subsidiary of the Corporation, and certain purchasers specified in the share purchase agreement (the “Logo Purchasers”), GSI agreed to sell to the Logo Purchasers and the Logo Purchasers agreed to purchase from GSI, all of the shares of Logo held by GSI in exchange for a cash payment in the amount of 300,000 Euros, the forgiveness of outstanding capital contributions owing by GSI to Logo with an aggregate value of 2,500,000 Euros, and the forgiveness of earnout amounts owing by GSI to the Logo Purchasers with an aggregate value of 1,250,000 Euros
- In addition, GSI and the Logo Purchasers conditionally entered into a share purchase agreement made on April 14, 2022 (the “Logo Call Option Agreement”), pursuant to which GSI has agreed to purchase a 49% ownership interest in Logo from the Logo Purchasers in exchange for payment by GSI of aggregate consideration in the amount of 3,400,000 Euros on or before December 31, 2022. The entering into force of the Logo Call Option Agreement is conditional upon the execution of the Logo Sale Agreement and the registration of the Logo Purchasers as the owners of the shares of Logo sold by GSI pursuant to the Logo Sale Agreement
Management Commentary
“The fiscal third quarter of 2022 has been focused pursuing strategic options for financing GetSwift in the short and long term” said Joel Macdonald, interim CEO. “The sale of the Logo shares and the plan to sell TSS in the US is a big step forward to accomplishing these goals. The process is still very early and fluid, but the management team is working very hard to maximize shareholder value,” Macdonald continued.
“We look forward to finding the right strategic partners in fiscal fourth quarter to complete these goals,” Macdonald explained.
“The management team has been, and will continue to be, focused on working with Board members, consultants, and advisors to identify and engage in the best available options in the market. More importantly, once identified – GetSwift will move expeditiously to close as quickly as possible.” Macdonald further added.
Third Quarter and the First Nine Months of 2022 Financial Results
Revenue for the third quarter of 2022 totaled $8.9 million, compared to $2.6 million for the third quarter of 2021. Revenue for the first nine months of 2022 was $29.3 million compared to the $15.4 million for the first nine months of 2021.
Total operating expenses for the third quarter of 2022 were $11.3 million as compared to total operating expenses of $6.4 million for the third quarter of fiscal 2021. Total operating expenses for the first nine months of 2022 was $39.1 million compared to the $29.5 million for the first nine months of 2021.
Total comprehensive loss for the third quarter of 2022 was $3.6 million, as compared to a total comprehensive loss of $4.3 million for the third quarter of fiscal 2021. Total comprehensive loss for the first nine months of 2022 was $13.0 million compared to the $11.9 million for the first nine months of 2021.
Cash inflow from operating activities for the third quarter of 2022 totaled $3.3 million compared to $5.2 million in the third quarter of fiscal 2021. Cash used in operating activities for the first nine months of 2022 was $5.4 million compared to the $9.7 million for the first nine months of 2021.
The information provided in this news release should be read in conjunction with the financial statements of the Corporation for the interim period ended March 31, 2022 and related management’s discussion and analysis, which are available under the Corporation’s profile on SEDAR at www.sedar.com.
Update Regarding the ASIC Proceedings
On December 20, 2021 a case management hearing was held. Orders were made that GetSwift Limited, Mr Hunter and Mr Macdonald pay 92.5% of ASIC’s costs of the proceeding. These costs have not been assessed and will not be payable until after the proceedings, including any penalty hearing, have finally concluded.
On February 18, 2022, GetSwift Ltd, Mr Macdonald and Mr Hunter filed appeals against the liability judgment. On May 16, 2022, Notices of Discontinuances were filed with the Court for GetSwift Ltd, Mr Macdonald and Mr Hunter to discontinue the appeal.
The matter will now be listed for a separate hearing in relation to whether any penalties should be imposed, including the extent and form of any penalties. At this stage, the Corporation cannot say when that hearing will occur.
About GetSwift Technologies Limited
Technology to Optimise Global Delivery Logistics
GetSwift is a technology and services company that offers a suite of software products and services focused on business and logistics automation, data management and analysis, communications, information security, and infrastructure optimization and also includes ecommerce and marketplace ordering, workforce management, data analytics and augmentation, business intelligence, route optimization, cash management, task management shift management, asset tracking, real-time alerts, cloud communications, and communications infrastructure (collectively, the “GetSwift Offering”). The GetSwift Offering is used by public and private sector clients across industries and jurisdictions for their respective logistics, communications, information security, and infrastructure projects and operations.
GetSwift is headquartered in New York and its common shares are listed for trading on the NEO Exchange under the symbol “GSW”. For further background, please visit the Corporation’s profile on SEDAR at www.sedar.com and the Corporation’s website at www.getswift.co.
Forward Looking Information
Certain statements contained in this news release constitute forward-looking information within the meaning of Canadian securities laws (“Forward-looking Information”). Forward-looking Information may relate to matters disclosed in this news release and to other matters identified in public filings relating to the Corporation, to the future outlook of the Corporation and anticipated events or results and may include statements regarding the future financial performance of the Corporation. In some cases, Forward-looking Information can be identified by terms such as “may”, “will”, “should”, “expect”, “plan”, “anticipate”, “believe”, “intend”, “estimate”, “predict”, “potential”, “continue” or other similar expressions concerning matters that are not historical facts. Forward-looking Information in this news release include statements related to short and long term strategic opportunities involving the Corporation and the timing, details, and outcome of the strategic review undertaken by the Board, and the type of strategic opportunity that may be pursued, and the outcome of the Notice of Discontinuances regarding the Australian Securities and Investments Commission v. GetSwift Limited & others Federal Court of Australia VID 146 of 2019, if any.
Forward-looking Information involves various risks and uncertainties and is based on certain factors and assumptions. There can be no assurance that such information will prove to be accurate, and actual results and future events could differ materially from those anticipated in such information. Forward-looking Information in this news release include, but are not limited to, statements with respect to: the availability of capital resources to the Corporation in the short and long term, the status of the Corporation’s evaluation of strategic opportunities, the evaluation of specific strategic opportunities, including the sale of the Corporation’s TSS business, and the Logo Sale Agreement, the Logo Call Option Agreement and the anticipated timing for completion of the transactions contemplated by such agreements.
Important factors that could cause actual results to differ materially from the Corporation's expectations include, without limitation, general market conditions, the ability of the Board to obtain short term financing to enable the Corporation to continue as a going-concern, the ability of the Board to identify strategic opportunities and of the Corporation to enter into agreements in respect of such strategic opportunities, the ability of the Corporation to complete the transactions contemplated by any strategic opportunity identified by the Board, the ability of management and the Board to dedicate resources to the strategic review and the effect of a strategic opportunity on maximizing shareholder value, the effect of the strategic review on maximizing shareholder value, the ability of the Corporation and the Logo Purchasers to complete the transactions contemplated by the Logo Sale Agreement and Logo Call Option Agreement, and the ability of the Corporation and Logo Purchasers to enter into and deliver the documentation required by the Logo Call Option Agreement.
The Corporation undertakes no obligation to update or revise any Forward-looking Information, whether as a result of new information, future events or otherwise, except as may be required by law. New factors emerge from time to time, and it is not possible for the Corporation to predict all of them, or assess the impact of each such factor or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any Forward-looking Information. Any Forward-looking Information contained in this news release is expressly qualified in its entirety by this cautionary statement.
GetSwift Technologies Limited |
||||||
Condensed interim consolidated statements of financial position |
||||||
| As at March 31, 2022 and June 30, 2021 | ||||||
| (In US dollars) | ||||||
March 31 |
|
June 30 |
|
|||
2022 |
|
2021 |
|
|||
$ |
$ |
|||||
| ASSETS | ||||||
| Current assets | ||||||
| Cash and cash equivalents | 1,347,138 |
|
7,276,107 |
|
||
| Trade and other receivables | 12,240,531 |
|
5,438,149 |
|
||
| Prepaids | 957,535 |
|
2,520,151 |
|
||
| Inventories | 7,329,432 |
|
1,860,062 |
|
||
| Other current assets | - |
|
- |
|
||
| Assets held for sale | 3,966,861 |
|
- |
|
||
| Total current assets | 25,841,497 |
|
17,094,469 |
|
||
| Non-current assets | ||||||
| Property, plant and equipment | 3,364,661 |
|
1,598,650 |
|
||
| Deferred tax assets | 38,873 |
|
35,735 |
|
||
| Goodwill and intangible assets | 6,301,787 |
|
11,140,009 |
|
||
| Other non-current assets | 898,820 |
|
1,137,412 |
|
||
| Total non-current assets | 10,604,141 |
|
13,911,806 |
|
||
| Total assets | 36,445,638 |
|
31,006,275 |
|
||
| LIABILITIES | ||||||
| Current liabilities | ||||||
| Trade and other payables | 21,488,106 |
|
10,590,902 |
|
||
| Line of credit | 3,925,406 |
|
482,342 |
|
||
| Contract liabilities | 18,352 |
|
79,481 |
|
||
| Warranty provisions | 604,187 |
|
557,540 |
|
||
| Employee benefit obligations | - |
|
65,997 |
|
||
| Lease and other current liabilities | 638,405 |
|
457,246 |
|
||
| Liabilities related to assets held for sale | 2,820,397 |
|
- |
|
||
| Total current liabilities | 29,494,853 |
|
12,233,508 |
|
||
| Non-current liabilities | ||||||
| Deferred tax liabilities | 669,014 |
|
858,220 |
|
||
| Warranty provisions | 397,010 |
|
283,680 |
|
||
| Lease non-current liabilities | 1,789,358 |
|
612,493 |
|
||
| Total non-current liabilities | 2,855,382 |
|
1,754,393 |
|
||
| Total liabilities | 32,350,235 |
|
13,987,901 |
|
||
| EQUITY | ||||||
| Share capital | 82,389,934 |
|
82,332,552 |
|
||
| Other reserves | (1,639,028 |
) |
314,409 |
|
||
| Accumulated losses | (81,587,586 |
) |
(69,910,131 |
) |
||
| Non-controlling interests | 4,932,083 |
|
4,281,544 |
|
||
| Total equity | 4,095,403 |
|
17,018,374 |
|
||
| Total liabilities and equity | 36,445,638 |
|
31,006,275 |
|
||
| GetSwift Limited | ||||||||||||
| Condensed interim consolidated statements of income (loss) and other comprehensive loss | ||||||||||||
| For the three and nine months ended March 31, 2022 and 2021 | ||||||||||||
| (In US dollars) | ||||||||||||
Three months ended March 31 |
Nine months ended March 31 |
|||||||||||
2022 |
|
2021 |
|
2022 |
|
2021 |
|
|||||
$ |
$ |
$ |
$ |
|||||||||
| Revenue from contracts with customers from continuing operations | 7,864,889 |
|
1,552,486 |
|
26,300,450 |
|
12,292,227 |
|
||||
| Revenue from contracts with customers from discontinued operations | 1,001,557 |
|
1,089,321 |
|
3,048,160 |
|
3,141,574 |
|
||||
| Total revenue | 8,866,446 |
|
2,641,807 |
|
29,348,610 |
|
15,433,801 |
|
||||
| General and administrative expenses | (1,884,699 |
) |
(2,486,212 |
) |
(9,025,396 |
) |
(10,848,341 |
) |
||||
| Employee benefits expenses | (1,332,024 |
) |
(1,001,600 |
) |
(4,199,629 |
) |
(3,557,401 |
) |
||||
| Operating expenses | (5,709,927 |
) |
(860,397 |
) |
(18,851,215 |
) |
(8,138,892 |
) |
||||
| Share-based payment expenses | 19,628 |
|
(24,569 |
) |
(20,576 |
) |
(86,722 |
) |
||||
| Total expenses from continuing operations | (8,907,022 |
) |
(4,372,778 |
) |
(32,096,816 |
) |
(22,631,356 |
) |
||||
| Total expenses from discontinued operations | (2,399,909 |
) |
(1,985,581 |
) |
(7,047,871 |
) |
(6,843,395 |
) |
||||
| Total expenses | (11,306,931 |
) |
(6,358,359 |
) |
(39,144,687 |
) |
(29,474,751 |
) |
||||
| Other income | 31,008 |
|
33,831 |
|
352,772 |
|
1,225,476 |
|
||||
| Other income from continuing operations | 13,364 |
|
22,241 |
|
318,085 |
|
1,133,532 |
|
||||
| Other income from discontinued operations | 17,644 |
|
11,590 |
|
34,687 |
|
91,944 |
|
||||
| Other gains(losses) | (960,752 |
) |
581,786 |
|
(1,509,160 |
) |
(5,284,380 |
) |
||||
| Other gains(losses) from continuing operations | (953,374 |
) |
(143,708 |
) |
(1,496,346 |
) |
(136,885 |
) |
||||
| Net gain on disposal of property, plant and equipment | 144 |
|
145 |
|
(16,708 |
) |
176 |
|
||||
| Net foreign exchange losses | (55,255 |
) |
(157,194 |
) |
(269,964 |
) |
(105,350 |
) |
||||
| Other items | (898,263 |
) |
13,341 |
|
(1,209,674 |
) |
(31,711 |
) |
||||
| Stock obsolescence | - |
|
- |
|
||||||||
| Other gains(losses) from discontinued operations | (7,378 |
) |
725,494 |
|
(12,814 |
) |
(5,147,495 |
) |
||||
| Income (loss) before income tax | (3,370,229 |
) |
(3,100,935 |
) |
(10,952,465 |
) |
(18,099,854 |
) |
||||
| Income tax benefit/(expense) | 60,292 |
|
51,568 |
|
(74,451 |
) |
92,616 |
|
||||
| Loss for the period from continuing operations | (1,921,851 |
) |
(2,890,191 |
) |
(7,049,078 |
) |
(9,249,866 |
) |
||||
| Loss for the period from discontinued operations | (1,388,086 |
) |
(159,176 |
) |
(3,977,838 |
) |
(8,757,372 |
) |
||||
| Loss for the period | (3,309,937 |
) |
(3,049,367 |
) |
(11,026,916 |
) |
(18,007,238 |
) |
||||
| Other comprehensive income | ||||||||||||
| Items that may be reclassified to profit or loss: | ||||||||||||
| Exchange differences on translation from foreign operations | (271,912 |
) |
(1,253,789 |
) |
(1,990,744 |
) |
6,070,247 |
|
||||
| Total comprehensive loss for the period from continuing operations | (2,193,763 |
) |
(4,143,980 |
) |
(9,039,822 |
) |
(3,179,619 |
) |
||||
| Total comprehensive loss for the period from discontinued operations | (1,388,086 |
) |
(159,176 |
) |
(3,977,838 |
) |
(8,757,372 |
) |
||||
| Total comprehensive loss for the period | (3,581,849 |
) |
(4,303,156 |
) |
(13,017,660 |
) |
(11,936,991 |
) |
||||
| Total comprehensive loss for the year is attributable to: | ||||||||||||
| Owners of GetSwift Technologies Limited | (3,722,981 |
) |
(3,947,887 |
) |
(13,668,199 |
) |
(11,369,304 |
) |
||||
| Non-controlling interests | 141,132 |
|
(355,269 |
) |
650,539 |
|
(567,687 |
) |
||||
(3,581,849 |
) |
(4,303,156 |
) |
(13,017,660 |
) |
(11,936,991 |
) |
|||||
| Loss per share for loss attributable to the ordinary equity holders of the company: | ||||||||||||
| Basic/diluted loss per share from continuing operations* | (0.06 |
) |
(0.09 |
) |
(0.23 |
) |
(0.30 |
) |
||||
| Basic/diluted loss per share from discontinued operations* | (0.05 |
) |
(0.01 |
) |
(0.13 |
) |
(0.28 |
) |
||||
| * Reflects the retrospective application of the 7:1 exchange ratio | ||||||||||||
GetSwift Technologies Limited |
||||||||||||
Condensed interim consolidated statements of cash flows |
||||||||||||
For the three and nine months ended March 31, 2022 and 2021 |
||||||||||||
(In US dollars) |
||||||||||||
Three months ended March 31 |
Nine months ended March 31 |
|||||||||||
2022 |
|
2021 |
|
2022 |
|
2021 |
|
|||||
$ |
$ |
$ |
$ |
|||||||||
| Cash flows from operating activities | ||||||||||||
| Receipts from customers (inclusive of GST) | 14,240,734 |
|
10,117,732 |
|
19,167,164 |
|
18,885,717 |
|
||||
| Payments to suppliers and employees (inclusive of GST) | (11,239,252 |
) |
(3,931,278 |
) |
(21,085,608 |
) |
(23,667,307 |
) |
||||
| R&D tax incentive received | - |
|
3,212 |
|
- |
|
165,829 |
|
||||
| Income taxes paid | - |
|
- |
|
(355,760 |
) |
(355,760 |
) |
||||
| Interest paid | (40,664 |
) |
(97,332 |
) |
(109,100 |
) |
(22,922 |
) |
||||
| Interest received | (17,639 |
) |
94,250 |
|
(23,227 |
) |
1,484 |
|
||||
| Total cash inflow (outflow) from operating activities from continuing operations | 2,943,179 |
|
6,186,584 |
|
(2,406,531 |
) |
(4,992,959 |
) |
||||
| Total cash inflow (outflow) from operating activities from discontinued operations | 316,715 |
|
(1,007,588 |
) |
(2,964,592 |
) |
(4,690,914 |
) |
||||
| Total cash inflow (outflow) from operating activities | 3,259,894 |
|
5,178,996 |
|
(5,371,123 |
) |
(9,683,873 |
) |
||||
| Cash flows from investing activities | ||||||||||||
| Payments for property, plant and equipment | (147,894 |
) |
2,684 |
|
(966,095 |
) |
(138,106 |
) |
||||
| Net cash inflow (outflow) from investing activities | (147,894 |
) |
2,684 |
|
(966,095 |
) |
(138,106 |
) |
||||
| Cash flows from financing activities | ||||||||||||
| Proceeds from issues of shares | - |
|
- |
|
- |
|
489,859 |
|
||||
| Financing costs for LDA facility | - |
|
- |
|
- |
|
(300,000 |
) |
||||
| Restrinction for letter of credit | - |
|
566,609 |
|
- |
|
(424,955 |
) |
||||
| Proceeds from line of credit | - |
|
- |
|
5,811,544 |
|
2,106,751 |
|
||||
| Repayment of line of credit | (2,248,830 |
) |
(420,329 |
) |
(2,368,480 |
) |
(2,668,758 |
) |
||||
| Principal elements of lease payments | (64,902 |
) |
(24,242 |
) |
(419,323 |
) |
(91,483 |
) |
||||
| Net cash inflow (outflow) from financing activities | (2,313,732 |
) |
122,038 |
|
3,023,741 |
|
(888,586 |
) |
||||
| Net (decrease) in cash and cash equivalents | 798,268 |
|
5,303,718 |
|
(3,313,477 |
) |
(10,710,565 |
) |
||||
| Cash and cash equivalents at the beginning of the period | 1,459,868 |
|
7,432,121 |
|
7,276,107 |
|
23,300,583 |
|
||||
| Effects of exchange rate changes on cash and cash equivalents | (516,906 |
) |
(892,419 |
) |
(2,221,400 |
) |
(746,598 |
) |
||||
| Assets held for sale | (394,092 |
) |
- |
|
(394,092 |
) |
- |
|
||||
| Cash and cash equivalents at end of the period | 1,347,138 |
|
11,843,420 |
|
1,347,138 |
|
11,843,420 |
|
||||
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