Destiny Media Technologies Inc. Announces Fiscal Year 2020 Results

Vancouver, British Columbia--(Newsfile Corp. - November 18, 2020) - Destiny Media Technologies (TSXV: DSY) (OTCQB: DSNY), the makers of Play MPE®, a cloud-based SaaS solution for digital asset management in the music industry, today announced financial results for its fiscal year ended August 31, 2020.

Highlights

Fred Vandenberg, President and CEO, said, "We closed out 2020 with high activity levels, fourth quarter revenue of $1.032 million, and full year revenue of $3.825 million. Play MPE® currency adjusted revenues grew by 5.3% in the fourth quarter, and 2.6% year over year. Foreign currency fluctuations had minor impacts, boosting our Play MPE® revenue in the quarter by 2% but reducing overall annual growth by 1.4%.

We continue to experience strong growth in our independent label revenue, with a foreign currency adjusted increase of 42.2% for the fourth quarter (unadjusted 45.7%), and an annual increase of 17.3% for the year (unadjusted 16.3%).

Gross margin for the fourth quarter, and fiscal year, remained consistent at 92%. Adjusted EBITDA for the fourth quarter grew by 27% to $0.203 million, compared to $0.159 million for 2019. Annual EBITDA decreased to $0.329 million from $0.718 million due primarily to one-time restructuring costs and in part to growing investments in product development for longer term accelerated growth. As at August 31, 2020, we held cash reserves of $2.622 million.

In 2020, Play MPE® made significant progress in several product enhancements, including expanding distribution software languages to Spanish, German, Japanese, and French, and improved recipient platform players to increase ease of access, content management and review. Immediately following year-end we released an updated release creator, which is designed to increase use by our enterprise customers and is the first step to allow non-enterprise customers to fully self-serve."

Mr. Vandenberg continued, "In 2020, to strengthen our team, the Company made significant improvements to its product development, marketing and business development teams. The Company added Sergei Berenson as a new Director of Engineering at the start of 2020. Mid-year we conducted a major restructuring of our business development group and appointed Glenn Mattern as our new Director of Business Development. Following these appointments, the Company expanded restructuring and recruitment efforts and focused on process improvements to further improve results of product and business development."

"2020 was a year of many exciting changes for Play MPE® and for the Company," said Fred Vandenberg, Chief Executive Officer for Destiny Media Technologies. "We have made several significant key additions to the team and invested in our ability to innovate and grow the Play MPE® business leading to positive returns."

Q4 2020 Financial Results

Highlights for the Q4 2020 include (all figures are USD, and comparisons are to Q4 2019):

  • Q4 revenue grew by 5.8% to $1.032M (vs. $0.975M in prior year);
  • Independent label revenue up 45.7%;
  • Gross margin consistent at 92%;
  • Adjusted EBITDA increased by 27%;
  • Cash reserves as at August 31, 2020 of $2.622M ($0.25/share).

Fiscal 2020 Results

Highlights for fiscal 2020 include (all figures are USD, and comparisons are to fiscal 2019):

  • Total revenue grew to $3.825M compared to $3.809M.
  • Play MPE® currency adjusted annual revenue growth of 2.6%;
  • Sends activity up 15.7%;
  • Independent label revenues up by 17.3%;
  • Addition of new Director of Engineering, Sergei Berenson and new Director of Business Development, Glenn Mattern, and expanded staffing dedicated to longer term revenue growth and product development;
  • Adjusted EBITDA declined to $0.329M from $0.718M due primarily to one-time restructuring costs associated with our business development group;
  • Normal course issuer bid successfully completed in the year, repurchasing 550,140 shares (5%) for a total cost of $0.533M.

Fiscal 2020 Earnings Conference Call

Destiny Media Technologies will host a conference call at 5:00 p.m. ET (2:00pm PT) on Wednesday, November 18, 2020, to further discuss its fiscal year 2020 results. Investors and interested parties may participate in the call by dialing 1-416-764-8688 or 1-888-390-0546 and referring to conference ID # 97888560. A written transcript and archived stream will subsequently be made available on Destiny's corporate site at http://www.dsny.com.

Destiny Media Technologies Inc.

CONSOLIDATED BALANCE SHEETS

As at August 31,
(Expressed in United States dollars)
 
2020

2019
 
$

$
ASSETS
 

 
Current
 

 
Cash and cash equivalents
1,841,340

2,512,138
Short-term investments
781,490

380,056
Accounts receivable, net of allowance for
 

 
    doubtful accounts of $23,412 [2019 – $10,106]
426,832

332,271
Other receivables
26,083

14,240
Prepaid expenses
78,562

77,067
Total current assets
3,154,307

3,315,772
Deposits
34,316

33,716
Property and equipment, net
194,277

260,907
Intangible assets, net
22,952

24,695
Right of use assets
403,961


Total assets
3,809,813

3,635,090
LIABILITIES AND STOCKHOLDERS’ EQUITY
 

 
Current
 

 
Accounts payable
119,399

132,451
Accrued liabilities
353,235

303,470
Deferred leasehold inducement


46,774
Deferred revenue
19,638

23,388
Obligation under capital lease
238,261


Total current liabilities
730,533

506,083
Operating lease liability, net of current portion
219,063


Total liabilities
949,596

506,083
Commitments and contingencies
 

 
Stockholders’ equity
 

 
Common stock, par value $0.001
 

 
    Authorized: 20,000,000 shares
 

 
    Issued and outstanding: 10,450,646 shares
 

 
      [2019 – issued and outstanding 11,000,786 shares]
10,451

11,001
Additional paid-in capital
9,366,290

9,850,348
Accumulated deficit
(6,171,068)
(6,340,483)
Accumulated other comprehensive loss
(345,456)
(391,859)
Total stockholders’ equity
2,860,217

3,129,007
Total liabilities and stockholders’ equity
3,809,813

3,635,090

 

Destiny Media Technologies Inc.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Years ended August 31,
(Expressed in United States dollars)

 

 
 
2020

2019

Q4 2020

Q4 2019
 
$

$

$

$
Service revenue
3,824,565

3,809,092

1,032,107

975,274
  
            
Cost of revenue
 

 

 

 
Hosting costs
106,804

107,434

33,443

23,878
Internal engineering support
24,303

28,441

5,025

7,144
Customer support
137,720

126,317

28,475

39,861
Third party and transaction costs
49,806

47,840

10,304

16,821
 
318,633

310,032

77,247

87,704
   
 

 

 

 
Gross Margin
3,505,932

3,499,060

954,860

887,570
 
92%

92%

92%

91%
Operating expenses
 

 

 

 
General and administrative
798,120

770,758

89,453

214,488
Sales and marketing
1,084,364

908,951

297,518

201,478
Product development
1,343,084

1,141,380

379,733

334,619
Depreciation and amortization
135,385

96,846

34,641

29,747
 
3,360,953

2,917,935

801,345

780,332
Income from operations
144,979

581,125

153,515

107,238
Other income
 

 

 

 
Interest income
24,415

27,188

4,672

6,034
Other income (expense)
21

2,465

2

885
Income before provision for income taxes
169,415

610,778

158,189

114,157
Income tax expense - deferred







Net income
169,415

610,778

158,189

114,157
Foreign currency translation adjustments
46,403

(38,217)
126,616

62,345
Total comprehensive income
215,818

572,561

284,805

176,502
Net income per common share, basic and diluted
0.02

0.06

0.02

0.01

 


Q4 and Fiscal Year 2020 Financial Summary


(millions of U.S. dollars)
Three months Ended August 31,

Twelve Months Ended August 31,
 
2020

2019

% Change

2020

2019

% Change
REVENUE
 

 

 

 

 

 
Play
1.029

0.961

7%

3.798

3.753

1%
MPE®
 

 

 

 

 

 
Other
0.003

0.014

(79%)

0.026

0.056

(54%)
Total Revenue
1.032

0.975

6%

3.824

3.809

0%
PROFITABILITY
 

 

 

 

 

 
Gross Margin $
0.955

0.888

8%

3.505

3.499

0%
Gross Margin %
93%

91%

2%

92%

92%

0%
Operating Expenses
0.801

0.780

3%

3.361

2.918

15%
Cash Operating Costs
0.756

0.735

3%

3.201

2.811

14%
Adjusted EBITDA
0.203

0.159

28%

0.329

0.718

(54%)
Net Income
0.158

0.114

39%

0.169

0.611

(72%)
Earnings Per Share
0.02

0.01

100%

0.02

0.06

(67%)
CASH
 

 

 

 

 

 
Cash Operating Income (Loss)
0.261

0.169

54%

0.363

0.744

(51%)
Working Capital
0.292

0.036

711%

(0.091)
0.096

(195%)
Changes
 

 

 

 

 

 
Cash Provided By (Used In)
0.553

0.205

170%

0.272

0.840

(68%)
Operating Activities
 

 

 

 

 

 
Cash Provided By (Used In) Investing
0.364

0.133

174%

(0.434)
0.592

(173%)
Activities
 

 

 

 

 

 
Cash (Used In) Financing Activities
-

(0.002)
-

(0.533)
(0.002)
-
CASH RESERVES
 

 

 

 

 

 
Cash and cash equivalents
 

 

 

1.841

2.512

(27%)
Short-term investments
 

 

 

0.781

0.380

106%
Total Cash Reserves
 

 

 

2.622

2.892

(9%)

 

About Destiny Media Technologies Inc.

Destiny Media Technologies ("Destiny") provides software as service (SaaS) solutions to businesses in the music industry solving critical problems in distribution and promotion. The core service, Play MPE® (www.plaympe.com), provides promotional music marketing to engaged networks of decision makers in radio, film, TV, and beyond. More information can be found at www.dsny.com.

Forward-Looking Statements

This release contains forward-looking statements that reflect current views with respect to future events and operating performance. Any such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in these forward-looking statements. Destiny Media Technologies is not obligated to update these statements in the future. For more information on the Company's risks and uncertainties relating to those forward-looking statements, please refer to the Risk Factors section in our Annual Form 10-K for the fiscal year ended August 31, 2020, which will be available on www.sedar.com or www.sec.gov.

Contact:

Fred Vandenberg
CEO, Destiny Media Technologies, Inc.
604 609 7736 x236

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/68439

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