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D-Box Technologies Inc
Symbol DBO
Shares Issued 175,950,573
Close 2020-11-11 C$ 0.115
Recent Sedar Documents

D-Box loses $954,000 in Q2

2020-11-11 17:05 ET - News Release

Mr. Sebastien Mailhot reports

D-BOX TECHNOLOGIES REPORTS SECOND QUARTER AND REACHES A SIGNIFICANT MILESTONE IN ITS HOME ENTERTAINMENT STRATEGY

D-Box Technologies Inc. has released its financial results for the second quarter ended Sept. 30, 2020.

Financial highlights

Highlights for the second quarter ended Sept. 30, 2020:

  • Cash and cash equivalents were $5.0-million as at Sept. 30, 2020, compared with $4.1-million as at March 31, 2020, while during the same period, cash flow provided by working capital generated $2.6-million, the line of credit balance decreased by $1.0-million and long-term debt increased by $2.0-million.
  • Total revenues decreased to $2.9-million from $6.3-million for the same period last year as a result of the adverse impact of the COVID-19 pandemic.
  • Net loss remained flat at $900,000 compared with the same period last year.
  • Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization)* decreased to ($600,000) from $100,000 for the same period last year.

Highlights for the six-month period ended Sept. 30, 2020:

  • Total revenues decreased to $5.1-million from $13.9-million for the same period last year as a result of the adverse impact of the COVID-19 pandemic.
  • Net loss increased to $1.9-million from $1.5-million for the same period last year.
  • Adjusted EBITDA* decreased to ($700,000) from $300,000 for the same period last year.

This quarter's results continued to be impacted by the COVID-19 global pandemic, but the corporation made progress on generating royalties as some movie theatres have resumed their activities. While the corporation does not know the future impact COVID-19 will have on its business, or when its business will fully return to normal operations, the corporation expects to see a continued impact from COVID-19 on its results in the coming quarters, especially in the commercial entertainment business, where some commercial entertainment venues are forced to close temporarily.

                          SECOND QUARTER AND SIX-MONTH PERIOD ENDED SEPT. 30  
                          (in thousands of dollars, except per-share amounts)

                                                        Second quarter                   Six-month period    
                                                     2020             2019             2020             2019

Revenues                                           $2,917           $6,329           $5,146          $13,862
Net (loss)                                           (954)            (933)          (1,920)          (1,539)
Adjusted EBITDA*                                     (571)             114             (667)             329
Basic and diluted net (loss) per share             (0.005)          (0.005)          (0.010)          (0.008)

* See the "Non-IFRS measures" section in management's discussion and analysis dated Nov. 11, 2020.

"We are pleased with the progress that D-Box has accomplished on multiple fronts in the past few months. Ensuring a healthy balance sheet has always been a top priority, and we are proud that we have been able to manage our spending and get some additional financing to maintain a cash position that is greater than at the beginning of the COVID-19 pandemic. With the expectation of a progressive recovery of our recurring revenue from the theatrical market in the next months and the future contribution of home entertainment revenue, we are cautiously optimistic that the brunt of the situation is at a tail end," mentioned Sebastien Mailhot, president and chief executive officer of D-Box.

"This quarter, recovery on our business has been encouraging with total revenues growing at 31 per cent sequentially between [second quarter] over [first quarter]. The simulation and training segments grew 44 per cent sequentially and 17 per cent compared to the same period last year, in large part due to the increasing penetration of simracing at home and great value proposition of our simulation and training offering. With the recent endorsement of the [Federation Internationale de l'Automobile], we do expect to see continued sequential growth," stated Mr. Mailhot.

"Our long-awaited immersive and haptic home entertainment system is now ready! We are proud to launch a home entertainment recliner, in partnership with Jaymar, that will integrate D-Box's haptic technology. It is an important milestone given the size of the market opportunity. U.S. consumers spent over $25-billion in 2019, up 8.4 per cent from the year before, in home entertainment streaming services, video-on-demand and electronic title purchases. By leveraging D-Box's strong brand and market leadership in haptics, D-Box has a unique opportunity to enhance the experience of consumers by providing a true-to-life experience from their home. Consumers will be able to enjoy over 2,000 pieces of content and growing, including movies, TV series, music, video games and a relaxation mode. Over time, D-Box will add new content types of all sorts and will constantly update the existing content. The movements, vibrations and textures will make entertainment lovers feel their favourite theme park ride, the beats of a live concert or experience floating on the moon. The possibilities are endless!" added Mr. Mailhot.

In other news, the corporation is pleased to announce the appointment this day of Eve Laurier to the corporation's board of directors. Mrs. Laurier brings more than 20 years of experience in communication and marketing strategy. Currently, she is general manager of Edelman Montreal's communications firm and is also a member of Edelman Canada's management team, a global public relations firm. Prior to joining Edelman, Mrs. Laurier worked for Richter, an accounting and financial consulting firm, where she held the position of vice-president, strategic relations. In 2020, she earned the revelation of the Quebec Association of Women in Finance, as well as a finalist at the Mercuriades for the women of exception award. Mrs. Laurier holds an executive MBA from McGill University and HEC Montreal. As well, she sits on the board of the Marie-Vincent Foundation (2017) and the Metropolitan Orchestra (2017).

"We welcome Mrs. Laurier to D-Box's board. Her appointment comes with perfect timing, just as we are about to launch our home entertainment strategy. Her strong credentials in communications and marketing and her vast business network will be a great asset as we maximize D-Box awareness," stated Denis Chamberland.

Operational highlights:

  • D-Box and Jaymar, a leading manufacturer of upholstered furniture in Canada, partnered to offer consumers a recliner, which integrates D-Box haptic technology, providing fans of series, movies and video games with immersive and haptic experiences.
  • Part of its gaming strategy, D-Box has been locking a lineup of video game franchises such as Ubisoft's latest Assassin's Creed Valhalla, Microsoft's Flight Simulator and Slightly Mad Studios' Project Cars 3.
  • The Federation Internationale de l'Automobile (FIA), the governing body of motor sport and mobility, announced the exclusive endorsement of D-Box products. The D-Box haptic system enables drivers to feel an incredibly powerful and reliable simulator that responds precisely to any in-game situation. The experience features subtle cues based on pavement variations, vehicle physics, acceleration, deceleration, braking, cornering, suspension feedback, traction, weather conditions and speed.

Additional information

The financial information relating to the second quarter ended Sept. 30, 2020, should be read in conjunction with the corporation's unaudited condensed consolidated financial statements and management's discussion and analysis dated Nov. 11, 2020. These documents are available at SEDAR.

About D-Box Technologies Inc.

D-Box redefines and creates realistic, haptic and immersive entertainment experiences by providing feedback to the whole body and sparking the imagination through motion. Haptic essentially allows users to feel sensations that would be felt if the body was interacting directly with physical objects. D-Box has collaborated with some of the best companies in the world to deliver new ways to enhance great stories. Whether it is movies, video games, virtual reality applications, themed entertainment or professional simulation, D-Box creates a feeling of presence that makes life resonate like never before.

D-Box is headquartered in Montreal with offices in Los Angeles, United States, and Beijing, China.

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