- Revenue increased 11.3% in Q2-2023 compared to Q2-2022, driven by organic growth and acquisitions.
- During Q2-2023 Tribe implemented additional cost reduction strategies to improve margins and accelerate its path to profitability.
- Management’s outlook is for continued growth from the increasing number of real estate development projects and onboarding of new communities.
VANCOUVER, BC, Aug. 29, 2023 /CNW/ – Tribe Property Technologies Inc. (TSXV: TRBE) (OTCQB US: TRPTF) (“Tribe” or the “Company“), a leading provider of technology-enabled property management solutions, today announces its financial results for three and six months ended June 30, 2023. All amounts are stated in Canadian dollars on an as reported basis under IFRS (International Financial Reporting Standards) unless otherwise indicated.
Joseph Nakhla, Tribe’s CEO commented, “I am very pleased with the second quarter results and the recently announced acquisition of Meritus Group Management Inc. in the Greater Toronto Area. Expanding our footprint in Ontario is a significant milestone for the Company. This is Tribe’s twelfth acquisition! We have established a successful track record of executing and integrating acquisitions to further accelerate the Company’s revenue growth. In addition, our organic growth profile remains stable, as we continue to experience a surge in community onboarding for management services and software usage, which we expect will result in a record total number of communities using our platforms and services.”
Mr. Nakhla further added, “This year we are also fully dedicated to improving profitability by reducing costs and optimizing efficiencies within our operations. During the second quarter we implemented additional cost reduction strategies which included employing process improvements, cost optimizations, headcount reduction and consolidation of back-office systems. We expect these expense reductions will benefit Tribe’s financial performance in the second half of 2023. We remain excited about the Company’s growth prospects and continue to be committed to improving our profitability while increasing revenues and strengthening our market leadership position.”
Q2-2023 and Year-to-date 2023 Financial Highlights
- Revenue: Second quarter 2023 revenue was a record $4.82 million; an increase of 11.3% compared to $4.33 million for the second quarter of 2022. First half 2023 revenue was $9.48 million; an increase of 11.1% compared to $8.54 million for the first half of 2022.
- Gross profit1: Gross profit for the second quarter of 2023 was $1.96 million (40.6%) compared to $1.70 million (39.2%) in the second quarter of 2022; First half 2023 gross profit was $3.78 million (39.9%) compared to $3.53 million (41.1%) for the first half of 2022.
- Adjusted EBITDA2: Adjusted EBITDA for the second quarter of 2023 was an outflow of $2.21 million compared with an outflow of $2.43 million in the second quarter of 2022. First half 2023 Adjusted EBITDA was an outflow of $4.07 million compared to an outflow of $3.91 million for the first half of 2022.
Business Highlights
On July 12, 2023, Tribe announced it partnered with OctoAI Technologies Corp. to provide condominium boards and strata councils with enhanced reporting and benchmarking capabilities to better understand the operational and financial health of their buildings.
On July 27, 2023, Tribe partnered with KnockNok, an app which connects maintenance and repair services to residents and homeowners. This adds to a robust offering of over 20 partnerships available through Tribe Market, the Company’s digital marketplace for residents, which is available to Tribe-managed buildings, as well as those licensing Tribe software.
On August 29, 2023 Tribe announced the acquisition of Meritus Group Management Inc., a property management company based in Toronto, Ontario. This acquisition marks a significant milestone for the Company expanding its management services directly into the largest metropolitan area in Canada, adding more than 5,000 homes under management. This acquisition strengthens Tribe’s national presence, now with 8 offices across Canada – 5 in BC, 1 in Alberta and 2 in Ontario, including the Company’s new Meritus office in Greater Toronto – bringing the Company’s full solution of management services, management software, pre-construction and post-construction software and digital marketplace for residents and homeowners across Canada.
Key Business Metrics as of Q2-2023
- 8 new property developers signed on to use either Tribe Home Pro construction software or Tribe Management services, for a total of 14 new property developer relationships in the first half of 2023.
- 9 new Tribe Home Pro software licensing agreements were signed in Q2 for new construction projects, for a total of 14 software license agreements in the first half of 2023.
- 10 projects using Tribe Home Pro software licensing agreements were successfully onboarded and began generating revenue in Q2.
- 15 property management agreements were signed in Q2, for a total of 20 property management agreements signed in the first half of 2023.
- 8 communities were successfully onboarded for management services and began generating revenue in Q2-2023.
Outlook
Management remains optimistic that 2023 will be a strong year for Tribe, expecting improved revenue, profitability and expanding margins. Management is pleased to report the Company is on track to achieve its key goals for 2023:
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Key Goal |
Progress |
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Despite concerns surrounding the real estate sales market and potential economic downturn, these factors have not hindered Tribe’s growth opportunities thus far. Tribe remains resilient and its growth in 2023 will be fueled by a robust pipeline of new development opportunities, strategic partnerships, winning new software agreements, and the increase of digital services revenue. Tribe continues to be active in its negotiations for additional acquisition targets which it plans to announce in the coming quarters.
Second Quarter Financial Webcast
The Company will hold a webcast to discuss its performance with the investment community at 9:00 a.m. PDT (12:00 p.m. EDT) on Wednesday, August 30, 2023.
Webcast Link: https://www.gowebcasting.com/12667
Participant Audio Only Dial-In Toll Free-North America: +1 (800) 319-4610
International Toll: +1 (604) 638-5340.
Non-IFRS Measures
The following and preceding discussion of financial results includes reference to Gross Profit, Gross Profit Percentage and Adjusted EBITDA, which are all non-IFRS financial measures. The measure of Gross Profit2 and Gross Profit Percentage2 is provided as management believes this is a good indicator in evaluating the operating performance of the Company. Adjusted EBITDA1 is provided as a proxy for the cash earnings (loss) from the operations of the business as operating income (loss) for the Company includes non-cash amortization and depreciation expense and stock-based compensation.
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Gross Profit2 |
Three Months Ended June 30 |
Six Months Ended June 30, |
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$000s |
2023 |
2022 |
2023 |
2022 |
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Revenue |
$ 4,821 |
$ 4,333 |
$9,480 |
$8,535 |
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Cost of software and services and software license fees |
2,865 |
2,633 |
5,696 |
5,000 |
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Gross Profit2 |
$ 1,956 |
$ 1,700 |
$3,783 |
$ 3,535 |
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Gross Profit2 Percentage |
40.6 % |
39.2 % |
39.9 % |
41.4 % |
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Adjusted EBITDA1 |
Three Months Ended June 30 |
Six Months Ended June 30, |
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$000s |
2023 |
2022 |
2023 |
2022 |
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Net loss |
$ (2,715) |
$ (2,970) |
$ (5,128) |
$(5,027) |
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Depreciation |
221 |
224 |
438 |
433 |
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Amortization |
147 |
96 |
294 |
193 |
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Stock-based compensation |
13 |
97 |
89 |
198 |
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Interest expense |
143 |
168 |
291 |
362 |
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Interest income |
(21) |
(57) |
(53) |
(83) |
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Other |
4 |
12 |
(2) |
13 |
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Adjusted EBITDA 1 |
$ (2,208) |
$ (2,430) |
$ (4,071) |
$ (3,911) |
Financial Statements and Management’s Discussion & Analysis
Please see the consolidated financial statements and related Management’s Discussion & Analysis (“MD&A”) for more details. The unaudited consolidated financial statements for the three and six months ended June 30, 2023 and related MD&A have been reviewed and approved by Tribe’s Audit Committee and Board of Directors. Tribe recognizes that most of its investors are now accessing corporate and financial information either through pushed news services, directly from www.tribetech.com or SEDAR. Thus, Tribe has prepared this truncated news release to alert investors to its results and that a more detailed explanation and analysis is readily available in the MD&A. These reports have been filed on SEDAR at www.sedarplus.ca and posted at www.tribetech.com.
About Tribe Property Technologies
Tribe is a property technology company that is digitizing the traditional property management industry. As a rapidly growing tech-forward property management company, Tribe’s integrated service-technology delivery model serves the needs of a much wider variety of stakeholders than traditional service providers.
Tribe’s three revenue pillars are made up of software and service (recurring licensing and management fees), transactional (rent or condo fees, banking services, lease-ups) and digital services and partnership (smart building products, financial and insurance service) revenue.
Tribe seeks to acquire highly accretive targets in the fragmented North American property management industry and transform these businesses through streamlining and digitization of operations. Tribe’s platform decreases customer acquisition costs, increases retention, and allows for the addition of value-added products and services through the platform. Visit tribetech.com for more information.
ON BEHALF OF THE BOARD
“Joseph Nakhla”
Chief Executive Officer
1606-1166 Alberni Street
Vancouver, British Columbia V6E 3Z3
Phone: (604) 343-2601
Email: [email protected]
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1 Non-IFRS measure that does not have a standardized meaning and may not be comparable to a similar measure disclosed by other issuers. Adjusted EBITDA is also not a measure recognized in accordance with IFRS and does not have a prescribed or standardized meaning by IFRS. The Company defines Adjusted EBITDA as net income or loss excluding depreciation and amortization, stock-based compensation, interest expense, income tax expense, impairment charges and other expenses. It should be noted that Adjusted EBITDA is not defined under IFRS and may not be comparable to similar measures used by other entities. The Company believes Adjusted EBITDA is a useful measure as it provides important and relevant information to management about the operating and financial performance of the Company. Adjusted EBITDA also enables management to assess its ability to generate operating cash flow to fund future working capital needs, and to support future growth. Excluding these items does not imply that they are non-recurring or not useful to investors. Investors should be cautioned that Adjusted EBITDA attributable to shareholders should not be construed as an alternative to net income (loss) or cash flows as determined under IFRS. |
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2 Non-IFRS measure that does not have a standard meaning and may not be comparable to a similar measure disclosed by other issuers. Gross Profit and Gross Profit Percentage do not have a standardized meaning under IFRS, and therefore may not be comparable to similar measures presented by other issuers. The Company defines Gross Profit as revenue less cost of software and services and software licensing fees, and Gross Profit Percentage as Pross Profit calculated as a percentage of revenue. Gross Profit and Gross Profit Percentage should not be construed as an alternative for revenue or net loss in accordance with IFRS. The Company believes that gross profit and gross profit percentage are meaningful metrics in assessing the Company’s financial performance and operational efficiency. |
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Cautionary Statement on Forward-Looking Information
This news release may contain certain “Forward-Looking Statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities laws regarding the Company and its business. When or if used in this news release, the words “anticipate”, “believe”, “estimate”, “expect”, “target, “plan”, “forecast”, “may”, “schedule” and similar words or expressions identify forward-looking statements or information. Forward-looking statements or information in this news release may relate to statements with respect to the aims and goals of the Company; financial projections; growth plans including future prospective consolidation in the property management sector; future acquisitions by the Company; closing and integration of the acquisition of Meritus Group Management Inc.; beliefs of the Company with respect to the independent owner-investors market; prospective benefits of the Company’s platform; and other factors or information. Such statements represent the Company’s current views with respect to future events and are necessarily based upon several assumptions and estimates that, while considered reasonable by the Company, are inherently subject to significant business, economic, competitive, political, and social risks, contingencies, and uncertainties. Many factors, both known and unknown, could cause results, performance, or achievements to be materially different from the results, performance or achievements that are or may be expressed or implied by such forward- looking statements. The Company does not intend, and do not assume any obligation, to update these forward-looking statements or information to reflect changes in assumptions or changes in circumstances or any other events affecting such statements and information other than as required by applicable laws, rules, and regulations.
SOURCE Tribe Property Technologies Inc.
Featured image: Megapixl © Khz
