Bay Street News

Optiva Inc. Reports Fourth Quarter 2023 Financial Results

All amounts are stated in United States dollars unless otherwise indicated

TORONTO, March 06, 2024 (GLOBE NEWSWIRE) — Optiva Inc. (“Optiva” or “the Company”) (TSX:OPT), a leader in powering the telecom industry with cloud-native billing, charging and revenue management software on private and public clouds, today released its fourth quarter financial results for the three-month and full-year period ended December 31, 2023.

During the quarter, Optiva secured three new customers, including a leading technology company in Nigeria specializing in cutting-edge telecom projects, a North American MVNO providing critical data-driven services to military veterans and a new market entrant in New Zealand, demonstrating the Company’s global impact. In addition, Optiva recently announced an expansion of its strategic partnership with BT Group and its role in powering Humane, an AI device designer with embedded mobile connectivity. All of these customers selected Optiva cloud-native BSS technology to rapidly bring innovative digital services to market and provide a superior customer experience and differentiated digital service offerings.

“New and existing customers are embracing our cloud-native portfolio with increased momentum. As our bookings continue to grow, I am encouraged by our success and agility in delivering a next-generation digital customer experience,” said Robert Stabile, Chairman of the Board of Directors and Chief Executive Officer of Optiva.

1 EBITDA, Adjusted EBITDA, TCV and Adjusted EPS are non-IFRS measures. These measures are defined in the “Non-IFRS Financial Measures” section of this news release.

For more information about Optiva, please visit: https://www.optiva.com/investors

Business Highlights

  Fourth Quarter 2023 Financial Results Highlights:
         
  Q4 Fiscal 2023 Highlights Three Months Ended
    Twelve Months Ended
 
  ($ US Millions, except per share information) December 31,
    December 31,
 
  (Unaudited)   2023     2022       2023     2022  
  Revenue   12.0     15.1       47.5     61.8  
  Net Income (Loss)   (4.0 )   (1.5 )     (12.3 )   0.7  
  Earnings (Loss) Per Share   ($0.65 )   ($0.24 )     ($1.98 )   $0.12  
  Adjusted Earnings (Loss) Per Share(1)   ($0.65 )   ($0.25 )     ($2.06 )   ($0.41 )
  Adjusted EBITDA(1)   (1.8 )   3.0       (1.9 )   13.9  
  Cash from (used in) operating activities   (0.9 )   2.0       (3.2 )   (0.2 )
  Total cash, including restricted cash   20.4     20.3       20.4     20.3  
             

(1) EBITDA, Adjusted EBITDA, TCV and adjusted EPS are non-IFRS measures. These measures are defined in the “Non-IFRS Financial Measures” section of this news release.

Non-IFRS Measures

“EBITDA” and “Adjusted EBITDA” are not financial measures calculated and presented in accordance with International Financial Reporting Standards (IFRS) and should not be considered in isolation or as a substitute to net income (loss), operating income or any other financial measures of performance calculated and presented in accordance with IFRS, or as an alternative to cash flow from operating activities as a measure of liquidity. The Company defines EBITDA as net income (loss) excluding amounts for depreciation and amortization, other income, finance costs, finance income, income tax expense (recovery), foreign exchange gain (loss) and share-based compensation. The Company defines “Adjusted EBITDA” as EBITDA (as defined above), excluding restructuring costs, one-time provision amounts and other one-time unusual items. The Company believes that Adjusted EBITDA is a metric that investors may find useful in understanding the Company’s financial position. The following table provides a reconciliation of Net Income to EBITDA and Adjusted EBITDA (in thousands of U.S. dollars).

         
  Three months ended, December 31, Year ended, December 31
    2023       2022       2023       2022  
         
Net income (loss) for the period $ (4,009 )   $ (1,507 )   $ (12,255 )   $ 709  
         
Add back / (substract):        
Depreciation of property and equipment   175       157       657       512  
Amortization of intangible assets         361       361       1,444  
Finance income   (283 )     (150 )     (599 )     (406 )
Finance costs   2,860       2,398       10,050       7,916  
Income tax expense (recovery)   (128 )     541       1,968       2,171  
Foreign exchange loss (gain)   (566 )     376       77       1,168  
Share-based compensation   150       863       (1,660 )     1,947  
EBITDA   (1,801 )     3,039       (1,401 )     15,461  
         
Other income               (498 )      
Release of provisions                     (1,571 )
         
Adjusted EBITDA $ (1,801 )   $ 3,039     $ (1,899 )   $ 13,890  

Adjusted EPS is reported diluted EPS excluding the impact of change in the fair value of warrants, release of provisions and other one-time unusual items.

TCV is the Total Contract Value of all bookings closed in the period.

About Optiva

Optiva Inc. is a leader in powering the telecom industry with cloud-native billing, charging and revenue management software on private and public clouds. Its products are delivered globally on the private and public cloud. The Company’s solutions help service providers maximize digital, 5G, IoT and emerging market opportunities to achieve business success. Established in 1999, Optiva Inc. is on the Toronto Stock Exchange (TSX: OPT). For more information, visit www.optiva.com.

Caution Concerning Forward-Looking Statement

Certain statements in this document may constitute “forward-looking” statements that involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements or industry results to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. When used in this document, such statements use such words as “may,” “will,” “expect,” “continue,” “believe,” “plan,” “intend,” “would,” “could,” “should,” “anticipate” and other similar terminology. Forward-looking statements in this document include statements regarding the Company’s “qualified pipeline”, the TCV of the qualified pipeline and the Company’s expectations regarding future revenues. These statements are forward-looking as they are based on our current expectations, as at March 6, 2024, about our business and the markets we operate in and on various estimates and assumptions. Our actual results could materially differ from our expectations if known or unknown risks affect our business or if our estimates or assumptions turn out to be inaccurate. As a result, there is no assurance that any forward-looking statements will materialize. Risks that could cause our results to differ materially from our current expectations include the risk that the Company will not secure contracts with customers that are included in its qualified pipeline, the risk that existing customers may decrease their spend with the Company and other risks that are discussed in the Company’s most recent Annual Information Form, available on SEDAR at www.sedar.com and Optiva’s website at www.optiva.com/investors/. Other unknown or unpredictable factors or underlying assumptions subsequently proving to be incorrect could cause actual results to differ materially from those in the forward-looking statements. Optiva does not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in its expectations or any change in events, conditions or circumstances on which any such statement is based, except as required by law.

For additional information, please contact:
Media Contact:
Misann Ellmaker
media@optiva.com

Investor Relations:
Ali Mahdavi
investors-relations@optiva.com

OPTIVA Inc.    
Consolidated Statements of Financial Position    
(Expressed in thousands of U.S. dollars)    
As at December 31, 2023 and December 31, 2022    
     
     
     
    2023       2022  
     
Assets    
     
Current assets:    
Cash and cash equivalents $ 19,642     $ 18,386  
Trade accounts and other receivables   7,504       7,535  
Unbilled revenue   14,362       17,821  
Prepaid expenses   2,185       1,938  
Income taxes receivable   3,633       3,820  
Other assets   480       610  
Total current assets   47,806       50,110  
     
Restricted cash   793       1,948  
Property and equipment   963       1,221  
Deferred income taxes   383       376  
Other assets   1,371        
Long-term unbilled revenue   727       332  
Intangible assets         360  
Goodwill   32,271       32,271  
     
Total assets $ 84,314     $ 86,618  
     
Liabilities and Shareholders’ Equity (Deficit)  
     
Current liabilities:    
Trade payables $ 2,256     $ 3,147  
Accrued liabilities   11,919       11,624  
Income taxes payable   4,299       4,365  
Deferred revenue   1,555       1,995  
Total current liabilities   20,029       21,131  
     
Deferred revenue   206       403  
Other liabilities   1,702       2,302  
Pension and other long-term employment benefit plans   132       713  
Debentures   101,348       87,716  
Deferred income taxes   185       433  
Total liabilities   123,602       112,698  
     
Shareholders’ equity (deficit):    
Share capital   270,610       270,560  
Contributed surplus   15,117       15,941  
Deficit   (328,885 )     (316,630 )
Accumulated other comprehensive income   3,870       4,049  
Total shareholders’ equity (deficit)   (39,288 )     (26,080 )
     
Total liabilities and shareholders’ equity (deficit) $ 84,314     $ 86,618  
     
OPTIVA Inc.    
Consolidated Statements of Comprehensive Income (Loss)  
(Expressed in thousands of U.S. dollars, except per share and share amounts)
Years ended December 31, 2023 and December 31, 2022  
     
     
   
    2023       2022  
     
Revenue:    
Support and subscription $ 31,306     $ 39,024  
Software licenses, services and other   16,200       22,755  
    47,506       61,779  
     
Cost of revenue   16,892       17,193  
     
Gross profit   30,614       44,586  
     
Operating expenses:    
Sales and marketing   10,347       9,872  
General and administrative   7,765       11,089  
Research and development   13,759       12,067  
    31,871       33,028  
     
Income (loss) from operations   (1,257 )     11,558  
     
Foreign exchange loss   (77 )     (1,168 )
Other income   498        
Finance income   599       406  
Finance costs   (10,050 )     (7,916 )
     
Income (loss) before income taxes   (10,287 )     2,880  
     
Income tax expense (recovery):    
Current   2,223       2,428  
Deferred   (255 )     (257 )
    1,968       2,171  
     
Net income (loss) for the year   (12,255 )     709  
     
Other comprehensive income:    
Items that will not be reclassified to net income:    
Actuarial gain on pension and non-pension    
post-employment benefit plans, net of income    
tax expense of nil (2022 – nil):   (179 )     6,505  
     
Total Comprehensive income (loss)   (12,434 )     7,214  
     
Net income (loss) per common share:    
Basic $ (1.98 )   $ 0.11  
Diluted   (1.98 )     0.11  
     
     
Weighted average number of common shares (thousands):  
Basic   6,179       6,178  
Diluted   6,179       6,178  
     
     
OPTIVA Inc.    
Consolidated Statements of Cash Flows    
(Expressed in thousands of U.S. dollars)    
Years ended December 31, 2023 and December 31, 2022  
     
     
   
    2023       2022  
     
Cash provided by (used in):    
     
Operating activities:    
Net Income (loss) for the year $ (12,255 )   $ 709  
Adjustments for:    
Depreciation of property and equipment   657       511  
Amortization of intangible assets   361       1,444  
Finance income   (599 )     (406 )
Finance costs   10,050       7,916  
Pensions   (793 )     (1,749 )
Income tax expense   1,968       2,171  
Unrealized foreign exchange (gain) / loss   220       (377 )
Share-based compensation   (1,660 )     1,947  
Provisions         (4,200 )
Change in non-cash operating working capital   575       (5,474 )
    (1,476 )     2,492  
Interest paid   (11 )     (29 )
Interest received   438       226  
Promissory note paid         (2,000 )
Income taxes paid   (2,198 )     (926 )
    (3,247 )     (237 )
     
Financing activities:    
Issuance of Debentures   13,500        
Transaction costs on debentures   (776 )      
Interest paid on Debentures   (8,775 )     (8,775 )
    3,949       (8,775 )
     
Investing activities:    
Purchase of property and equipment   (395 )     (850 )
Decrease (increase) in restricted cash   1,155       (1,156 )
    760       (2,006 )
     
Effect of foreign exchange rate changes    
on cash and cash equivalents   (206 )     (183 )
     
Increase (decrease) in cash and cash equivalents   1,256       (11,201 )
     
Cash and cash equivalents, beginning of year   18,386       29,587  
     
Cash and cash equivalents, end of year $ 19,642     $ 18,386  
     


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