Mr. Sebastien Mailhot reports
D-BOX TECHNOLOGIES REPORTS FISCAL YEAR AND FOURTH QUARTER 2020 RESULTS
D-Box Technologies Inc. has released results for the fiscal year and fourth quarter ended March 31, 2020.
Highlights for the year ended March 31, 2020, compared with the year ended March 31, 2019:
Revenues decreased from $34.2-million to $25.9-million.
Recurring revenues decreased from $8.6-million to $7.3-million.
Net loss went from $1.7-million to $6.3-million.
Net loss for this year includes $1.4-million of restructuring costs to reflect the change of the organizational structure and $1.3-million of impairment charges.
Adjusted EDITDA* (earnings before interest, taxes, depreciation and amortization) decreased from $2.1-million to $600,000.
Highlights for the fourth quarter
ended March 31, 2020,
compared with the fourth quarter ended March 31, 2019:
Revenues decreased from $8.3-million to $6.6-million.
Recurring revenues decreased from $1.8-million to $1.3-million.
Net loss went from $600,000 to $3.1-million.
Net loss for this quarter includes $400,000 of restructuring costs and $1.3-million of impairment charges.
Quarterly adjusted EBITDA* amounted to $7,000 compared with $300,000.
"The COVID-19 pandemic abruptly and severely impacted D-Box's fourth quarter results. With mandated social distancing and government-imposed temporary shutdown of entertainment venues around the world, the impact on our industry was exacerbated during the month of March. While most of our customers around the world have reopened or are planning to reopen in the near future, the timing for a full recovery remains uncertain, and first quarter and second quarter financial results will most likely be adversely impacted," stated Sebastien Mailhot, president and chief executive officer of D-Box. "It is a key priority for D-Box to work towards achieving a profitable business as soon as the business activity normalizes. The organization has already taken steps to transform into a different structure to ensure long-term sustainability of the business. Furthermore, the addition of $2-million long-term debt with the Business Development Bank of Canada and the restructuring of the current debt with the National Bank of Canada into a line of credit of $4-million will strengthen the corporation's liquidity position.
"Despite the economic challenges, our main concern remains the health and safety of our customers, partners and our employees, whom I thank for their unconditional dedication under tough conditions," added Mr. Mailhot. "We are optimistic that we will be able to weather this unprecedented period with the strengthening of our balance sheet and cost reduction initiatives. While D-Box has grown as a market leader in the theatrical industry, D-Box has diversified over the years into other markets such as professional simulation and commercial entertainment. We are confident our technological platform will allow D-Box to expand into the home entertainment market with applications for movies, series, games, virtual reality and racing simulation. Recently, we launched a racing simulation initiative, and the feedback shows that it is very promising."
FISCAL YEAR AND FOURTH QUARTER ENDED MARCH 31
(in thousands of dollars, except per-share data)
Fiscal year Fourth quarter
2020 2019 2020 2019
Revenues $25,895 $34,164 $6,560 $8,309
Net (loss) (6,250) (1,705) (3,096) (551)
Adjusted EBITDA* 612 2,062 7 267
Basic and diluted net (loss) per share (0.036) (0.010) (0.019) (0.003)
* See the "Non-IFRS measures" section in management's discussion and analysis dated July 3, 2020.
On June 23, 2020, the corporation signed a term sheet with National Bank of Canada related to the availability of a line of credit amounting to $4-million for the continuing operations and working capital of the corporation. This line of credit will be renewable annually and will bear interest at prime rate plus 3.25 per cent. The line of credit will be secured by first-ranking hypothec and security interests on all assets of the corporation and its U.S. subsidiary, and will replace the three-year secured revolving credit facility with NBC from which an amount of $4-million was drawn at March 31, 2020.
On June 19, 2020, the corporation also executed a letter of offer with Business Development Bank of Canada related to the availability of a working capital commercial loan of $2-million. This loan will bear interest at a variable rate, currently 4.55 per cent, and will be payable in 24 monthly instalments of $33,000 from June, 2021, to May, 2023, and by a final payment of $1.2-million in June, 2023. The loan will be secured by second-ranking hypothec and security interests on all assets of the corporation and its U.S. subsidiary.
The signed term sheet from NBC is subject to the signing of an offer of financing and customary conditions precedent, and the executed letter of offer of the BDC is subject to customary conditions precedent. A closing is expected to take place in July, 2020.
On March 11, 2020, the World Health Organization declared coronavirus (COVID-19) a global pandemic. Most governments have enacted emergency measures to combat the spread of the virus, including travel bans, mandatory closures of non-essential services and businesses, and social distancing. These measures have caused material disruption to businesses worldwide, resulting in economic uncertainty, supply chain disruption and change in consumer demand. At the present time, D-Box cannot reliably provide an estimate of the duration or magnitude of the outbreak and its impact on the corporation's financial results.
In the professional simulation segment, CM Labs, the leading vendor for simulation-based training in the construction industry with over 1,000 simulators in 30 countries, has developed a new simulator. This simulator, which integrates D-Box's motion technology, is adapted for the training of heavy equipment operators.
In the themed entertainment, BRP Inc., a global leader in power sport vehicles and marine products, has developed a Ski-Doo simulator with D-Box's motion technology to replicate an immersive experience.
In the theatrical segment, D-Box expanded its footprint with the additions from Premiere Cinemas (United States), Traumpalast (Germany) and Golden Screen Cinemas (Malaysia).
Additional information regarding the fiscal year and fourth quarter ended March 31, 2020
The financial information relating to the fiscal year and fourth quarter ended March 31, 2020, should be read in conjunction with the corporation's audited consolidated financial statements. The annual information form and management's discussion and analysis are dated July 3, 2020. These documents are available at
About D-Box Technologies Inc.
D-Box redefines and creates realistic, immersive entertainment experiences by moving the body and sparking the imagination through motion. D-Box has collaborated with some of the best companies in the world to deliver new ways to enhance great stories. Whether movies, video games, virtual reality applications, themed entertainment or professional simulation, creating a feeling of presence makes life resonate like never before.
D-Box is headquartered in Montreal, Canada, with offices in Los Angeles, United States, and Beijing, China.
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