Mr. David Feller reports
MOGO REPORTS FIRST QUARTER 2022 FINANCIAL RESULTS
Mogo Inc. has released its financial and operational results for the first quarter ended March 31, 2022.
"We delivered 51 per cent revenue growth and record quarterly gross profit while approaching two million members on the Mogo platform, up 62 per cent from this time last year," said David Feller, Mogo's founder and chief executive officer. "During periods of market volatility, the recurring nature of our revenue base -- roughly 95 per cent recurring -- continues to serve us well. Looking ahead, we remain as committed as ever to bringing Canadian consumers the best tools and products to help them achieve financial freedom, while making a positive impact with their money. Our team continues to be focused on building out the leading next-gen digital wealth platform, including the upcoming rollout of MogoTrade, our commission-free stock trading app. The current challenging conditions in equity markets do not change our view of the long-term growth potential for MogoTrade given the massive addressable market and the opportunity for digital disruption, and we couldn't be more excited about the products we are building."
Key financial highlights for Q1 2022
Total revenue increased 51 per cent over the comparable quarter in 2021 to a record $17.3-million, driven by subscription and services revenue, which increased 78 per cent over the comparable quarter in 2021 to $10.7-million.
- Gross profit increased
30 per cent to $12.3-million (71.4-per-cent margin), compared with $9.5-million (83-per-cent margin) in Q1 2021.
Contribution increased 17 per cent to $7.4-million, compared with $6.3-million in Q1 2021.
- Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) loss of $5.5-million, compared with adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) loss of $1.1-million in Q1 2021, reflecting increased growth investments in the company's platform and products, particularly for MogoTrade.
Adjusted net loss of $10.8-million, compared with $5.7-million in Q1 2021.
- Net loss increased to $18.9-million in Q1 2022, compared with $2.8-million in Q1 2021. The year-over-year change reflects increased growth spend, Mogo's share of Coinsquare's net loss during the quarter of $5.6-million (versus net income of nil in Q1 2021), and an unrealized loss on Mogo's investment portfolio of $400,000 in the current period compared with a gain of $5.8-million in the same period last year.
- Ended the quarter with combined cash, digital assets and investment portfolio of $74.8-million, which excludes the company's investment in cryptocurrency platform Coinsquare, which had a book value of $98.3-million as at March 31, 2022.
Approved a share repurchase program with authorization to purchase up to $10-million (U.S.) of common shares.
"Our diversified and primarily recurring revenue base proved resilient in the first quarter as we continued to show strong growth during a more challenging period for many fintechs," said Greg Feller, president and chief financial officer of Mogo. "Although we are continuing to make substantial investments in new products and our platform given our view of the long-term opportunity, we continue to have control of our growth investment dials should we find it necessary to moderate our investments and move more quickly towards profitability. Importantly, we maintain a strong financial position which, when combined with the proven profitability of our model, gives us the conviction of our investments in important growth areas including MogoTrade, our MogoWealth platform and our Carta Worldwide payments division. These products open up substantial new markets for Mogo and we believe position the company very well in the Canadian market for driving additional growth in 2023 and beyond."
Mogo updated its full-year 2022 outlook, reflecting a shift in the rollout timeline and expected contribution from MogoTrade, as well as the deferral of certain customer program rollouts in its payments processing subsidiary Carta Worldwide to 2023. In fiscal year 2022:
Total revenues are expected to grow between 20 per cent to 25 per cent year over year to $69-million to $72-million. This compares with previous guidance of $75-million to $80-million;
- The company now expects improving adjusted EBITDA as a percentage of revenue beginning in Q2 2022 (versus previously communicated guidance of improving adjusted EBITDA as a percentage of revenue in the second half of the year).
Conference call and webcast
Mogo will host a conference call to discuss its Q1 2022 financial results at 3 p.m. EDT on May 11, 2022. The call will be hosted by David Feller, founder and chief executive officer, and Mr. Greg Feller, president and chief financial officer. To participate in the call, dial 416-764-8658 or 888-886-7786 (international). Listeners should access the webcast or call 10 to 15 minutes before the start time to ensure they are connected.
Mogo, one of Canada's leading financial technology companies, is empowering its 1.9 million members with simple digital solutions to help them get in control of their financial health while also making a positive impact with their money. Through the free Mogo app, consumers can access a digital spending account with the Mogo Visa Platinum prepaid card, featuring automatic carbon offsetting, easily buy and sell bitcoin, get free monthly credit score monitoring and ID fraud protection, and access personal loans and mortgages. Mogo's new MogoTrade app offers commission-free stock trading that helps users make a positive impact with every investment and together with Moka, Mogo's wholly owned subsidiary, bringing automated, fully managed flat-fee investing to Canadians, forms the heart of Mogo's digital wealth platform. Mogo's wholly owned subsidiary, Carta Worldwide, also offers a digital payments platform that powers the next-generation card programs from innovative fintech companies in Europe, North America and Asia Pacific.
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