Renoworks Announces Annual and Record Fourth Quarter 2023 Financial Results and Provides Outlook
CALGARY, ALBERTA, April 26, 2024 – Renoworks Software Inc. (TSXV: RW) (“Renoworks” or the “Company), an industry leader in visualization and lead generation technology for the home renovation and new construction sector, announces its financial results for the year ended December 31, 2023. The financial statements and related management’s discussion and analysis (“MD&A”) can be viewed on SEDAR+ at www.sedarplus.ca. Unless otherwise stated, all dollar amounts are Canadian dollars.
Financial highlights for the fiscal year 2023 with comparatives for 2022 are as follows:
- Annual revenues of $6,292,601, a slight increase from the prior year’s $5,941,830.
- Deferred Revenue of $1,633,394 December 31, 2023 compared to $1,413,786 at December 31, 2022.
- Recurring revenue of $2,251,019 versus $1,869,674 for the same period in 2023, a 20% increase.
- Gross margin of 70% versus 64% in 2022.
- Net loss of $497,771 compared to a net loss of $1,320,786 in 2022, an improvement attributed primarily to the rise in licensing and hosting revenue of 20% and reductions in operational expenditures.
- Cash at December 30, 2023 was $645,549, down $58,531 from $704,080 at the end of fiscal 2022.
- The Company’s working capital at December 31, 2023 was a negative $228,357 compared to a positive working capital of $207,163 at December 31, 2022 a decrease of $435,520 primarily due to an increase in deferred revenue balances of $240,515. Excluding deferred revenue, a significant non-cash item included in working capital, the Company’s working capital at December 31, 2023 is positive $1,264,069 ($1,459,074 – Dec 31, 2022).
- As at December 31, 2023, the Company had 40,664,635 common shares issued and outstanding.
Financial highlights for the fourth quarter of fiscal 2023 with comparatives for 2022 are as follows:
- Quarterly revenue of $1,503,032 for the three months ended December 31, 2023 versus $1,201,509 in 2022.
- Recurring revenue of $618,534 versus $473,155 for the same period in 2023, a 31% increase.
- Gross margins continue to be strong at 66% and 62%, respectively for the fourth quarters of 2023 and 2022.
- Net loss of $211,734 for the quarter ended December 31, 2023 compared to a net loss of $705,601 in 2022.
Renoworks reported a total revenue of $6,292,601 for the year ending December 31, 2023, marking a 6% increase of $350,771 from the previous year’s $5,941,830. This increase was primarily fueled by a 20% rise in licensing and hosting revenue, reflecting the Company’s strategic advancement of its visualization solutions adoption within the remodel industry.
"Our financial results are a direct outcome of our focused investments in AI-driven solutions, partner integrations, Renoworks Pro through key partnerships, and resource management."
The decrease in net loss for 2023 as compared to 2022 is primarily due to these increased revenues, and improvements to operational efficiencies which includes gains through reduced selling, general administrative costs, and research and development expenses.
“Our financial results are a direct outcome of our focused investments in AI-driven solutions, partner integrations, Renoworks Pro through key partnerships, and resource management,” explained Doug Vickerson, CEO of Renoworks. “These initiatives are helping to drive the adoption of our platform and brand awareness across the industry.”
For the fourth quarter ended December 31, 2023, Renoworks’ Adjusted EBITDA was a negative $189,211, showing significant improvement with a rise of $461,836 from the previous year’s negative $651,047. This upward shift underscores the Company’s continuous strides towards enhancing platform functionality and operational efficiency.
Investments in technology and strategic initiatives remained high, as Renoworks continued to develop its contractor software platform and expand its AI Gen2.0, Data Science, and Analytics capabilities. These efforts aim to bolster the company’s product offerings and market position.
Financial results from operations year to date with comparatives for 2022 are as follows:
| Twelve Months Ended December 31 | ||
|---|---|---|
| 2023 | 2022 | |
| Revenue | $6,292,601 | $5,941,830 |
| Gross Profit | $4,430,468 | $3,788,526 |
| Expenses | $4,869,413 | $5,179,700 |
| Net Loss | $497,771 | $1,320,786 |
| Loss per share | $0.01 | $0.03 |
| Adjusted EBITDA | ($405,090) | ($1,064,609) |
| Weighted Average Shares Outstanding | 40,664,608 | 40,167,566 |
| Cash Decrease from Operations | $52,832 | $1,184,487 |
Financial results from operations for the fourth quarter 2023 with comparatives for 2022 are as follows:
| Three Months Ended December 31 | ||
|---|---|---|
| 2023 | 2022 | |
| Revenue | $1,503,032 | $1,201,509 |
| Gross Profit | $993,562 | $740,887 |
| Expenses | $1,166,145 | $1,471,824 |
| Net Loss | $211,734 | $705,601 |
| Income (Loss) per share | ($0.01) | ($0.01) |
| Adjusted EBITDA | ($189,211) | ($651,017) |
| Weighted Average Shares Outstanding | 40,664,635 | 40,167,566 |
The Company’s financial position as of December 31, 2023 and December 31, 2022 is as follows:
| December 31, 2023 | December 31, 2022 | |
|---|---|---|
| Cash Balance | $645,549 | $704,080 |
| Accounts Receivable | $666,193 | $734,706 |
| Working Capital | ($228,357) | $207,163 |
| Deferred Revenue | $1,633,394 | $1,413,786 |
| Long-term Liabilities | $140,968 | $161,875 |
| Shareholder's Equity (Deficiency) | ($195,192) | $232,715 |
| Deficit | ($10,232,787) | ($9,735,016) |
| Total Assets | $1,672,766 | $1,788,806 |
About Renoworks
Renoworks Software Inc. develops and sells unique digital visualization software and integration solutions for the remodeling and new home construction industry. Renoworks delivers its technology to manufacturers, contractors, builders, and retailers offering solutions to one of the home improvement industry’s greatest challenges: enabling homeowners to review their product selections in a hyper-realistic, virtual environment before committing to purchases and construction. Renoworks markets its technologies as an innovative engagement, sales, and marketing platform and generates revenues from five main business lines: Renoworks Enterprise, Renoworks PRO, Renoworks Design Services, Renoworks FastTrack, and Renoworks API (Application Programming Interface). For more information, visit www.renoworks.com and www.renoworkspro.com.
For further information on Renoworks, please contact:
Doug Vickerson, CEO
Phone: 403-296-3880
E-mail: doug.vickerson@renoworks.com
*Non-IFRS Measures
Adjusted EBITDA is a measure not recognized under IFRS. However, management of Renoworks believes that most shareholders, creditors, other stakeholders and investment analysts prefer to have these measures included as reported measures of operating performance, a proxy for cash flow, and to facilitate valuation analysis. Adjusted EBITDA is defined as earnings before interest income, taxes, depreciation and amortization, stock based compensation, restructuring costs, impairment charges and other non-recurring gains or losses. Management believes Adjusted EBITDA is a useful measure that facilitates period-to-period operating comparisons.
Adjusted EBITDA does not have any standardized meanings prescribed by IFRS and therefore may not be comparable to similar measures presented by other issuers. Readers are cautioned that Adjusted EBITDA is not an alternative to measures determined in accordance with IFRS and should not, on its own, be construed as indicators of performance, cash flow or profitability. References to the Renoworks’ Adjusted EBITDA should be read in conjunction with the financial statements and management’s discussion and analysis of Renoworks posted on SEDAR+ (www.sedarplus.ca).
Forward Looking Information
Certain statements in this news release, other than statements of historical fact, are forward looking information that involves various risks and uncertainties. Such statements relating to, among other things, the prospects for the Company to enhance operating results, are necessarily subject to risks and uncertainties, some of which are significant in scope and nature. These uncertainties may cause actual results to differ from information contained herein. There can be no assurance that such statements will prove to be accurate. Actual results and future events could differ materially from those anticipated in such statements. These and all subsequent written and oral forward looking statements are based on the estimates and opinions of the management on the dates they are made and expressly qualified in their entirety by this notice. The Company assumes no obligation to update forward-looking statements should circumstances or management’s estimates or opinions change.
The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.