U.S. markets closed
  • S&P Futures

    3,252.00
    +14.00 (+0.43%)
     
  • Dow Futures

    26,832.00
    +117.00 (+0.44%)
     
  • Nasdaq Futures

    10,933.25
    +41.50 (+0.38%)
     
  • Russell 2000 Futures

    1,458.60
    +11.60 (+0.80%)
     
  • Crude Oil

    40.49
    +0.18 (+0.45%)
     
  • Gold

    1,873.00
    -3.90 (-0.21%)
     
  • Silver

    23.20
    +0.01 (+0.04%)
     
  • EUR/USD

    1.1666
    -0.0010 (-0.08%)
     
  • 10-Yr Bond

    0.6660
    -0.0100 (-1.48%)
     
  • Vix

    28.51
    -0.07 (-0.24%)
     
  • GBP/USD

    1.2746
    -0.0006 (-0.04%)
     
  • USD/JPY

    105.4000
    -0.0020 (-0.00%)
     
  • BTC-USD

    10,704.08
    -56.50 (-0.53%)
     
  • CMC Crypto 200

    218.23
    +9.29 (+4.45%)
     
  • FTSE 100

    5,822.78
    -76.48 (-1.30%)
     
  • Nikkei 225

    23,204.13
    +116.31 (+0.50%)
     

NexTech AR Solutions Reports Record Second Quarter 2020 Results

NexTech AR Solutions Corp.

VANCOUVER, British Columbia, Aug. 25, 2020 (GLOBE NEWSWIRE) -- NexTech AR Solutions (NexTech) (OTCQB: NEXCF) (CSE: NTAR) (FSE: N29), an emerging leader in augmented reality (AR) for eCommerce, AR learning applications, and AR-enhanced video conferencing and virtual events, reported record results for its second quarter ended June 30, 2020. All figures are prepared in accordance with International Financial Reporting Standards (IFRS) unless otherwise indicated.

Q2 2020 highlights:

  • Revenue grows 290% to $3.5 million

  • Gross Profit grows 484% to $2.1 million with a 61% margin

  • Working Capital of $5.6 million

  • Total Bookings $3.7 million

  • Full report has been filed and is available on SEDAR 

Q2 earnings will be released after the close today at 4:30pm

Bridge Name: NexTech AR Solutions
Conference ID: 597-9019
Dial in: +1 (435) 777-2200
Toll-Free + 1 (800) 309-2350

Evan Gappelberg, CEO of NexTech comments, “We are extremely pleased to report that our record second quarter 2020 results are continuing into Q3 and are showing strong momentum across our business segments. These results were driven by new customer additions, expansion of product lines and increases in conversions from our e-commerce channels. He continues “We are uniquely positioned with our augmented reality, e-commerce and InfernoAR video conferencing and virtual events business units to thrive in this new economy being led by a digital transformation across technology. There has never been more business opportunity in our lifetime for augmented reality, virtual learning, virtual conferences, or virtual events, and e-commerce and we see strong business trends continuing in Q3 and beyond.” 

Kashif Malik, CFO of NexTech comments, “Q2 has been an amazing quarter and I am thrilled to see the team firing on all cylinders by delivering on sales. With the successful integration of our Jolokia acquisition in Q2 we are now positioned for a rapid acceleration in our business as we continue to land more deals and look for additive acquisitions that further expand and grow our business.”


NexTech AR Solutions Corp.
Condensed Consolidated Interim Statements of Financial Position
(Unaudited - Expressed in Canadian dollars)

 

 

 

 

 

 

June 30, 2020

December 31, 2019

 

 

$

$

ASSETS

 

 

 

Current assets

 

 

 

Cash

 

6,282,197

 

2,849,344

 

Receivables (Note 4)

 

264,104

 

403,651

 

Prepaid expenses and deposits

 

195,990

 

200,650

 

Inventory

 

1,681,465

 

1,353,584

 

Total current assets

 

8,423,756

 

4,807,229

 

 

 

 

 

Non-current assets

 

 

 

Equipment (Note 5)

 

242,303

 

146,555

 

Intangible assets (Note 6)

 

2,250,734

 

1,420,552

 

Goodwill (Note 6)

 

3,997,440

 

2,262,527

 

Total non-current assets

 

6,490,477

 

3,829,634

 

 

 

 

 

TOTAL ASSETS

 

14,914,233

 

8,636,863

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

LIABILITIES

 

 

 

Current liabilities

 

 

 

Accounts payable and accrued liabilities (Note 7)

 

1,748,473

 

1,243,528

 

Other payables (Note 8)

 

-

 

230,174

 

Contingent consideration (Note 3)

 

1,067,181

 

-

 

Total current liabilities

 

2,815,654

 

1,473,702

 

 

 

 

 

Long-term liabilities

 

 

 

Deferred income tax liability

 

48,478

 

96,956

 

Total Long-term liabilities

 

48,478

 

96,956

 

 

 

 

 

TOTAL LIABILITIES

 

2,864,132

 

1,570,658

 

 

 

 

 

 

 

EQUITY

 

 

 

 

 

Share capital (Note 10)

 

23,562,376

 

15,210,041

 

Convertible debentures (Note 9)

 

-

 

1,025,595

 

Reserves (Note 10)

 

2,565,234

 

1,407,330

 

Deficit

 

(14,077,509

)

(10,576,761

)

TOTAL SHAREHOLDERS’ EQUITY

 

12,050,101

 

7,066,205

 

 

 

 

 

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

 

14,914,233

 

8,636,863

 


NexTech AR Solutions Corp.
Condensed Consolidated Interim Statements of Comprehensive Loss
For the three and six months ended June 30, 2020 and 2019
(Unaudited - Expressed in Canadian dollars)

 

For the three months ended June 30,

For the six months ended June 30,

 

2020

2019

2020

2019

 

$

$

$

$

Revenue

3,529,029

 

905,915

 

6,021,014

 

1,807,025

 

Cost of sales

(1,359,294

)

(534,094

)

(2,503,430

)

(1,068,187

)

Gross profit

2,169,735

 

371,821

 

3,517,584

 

738,838

 

 

 

 

 

 

Operating expenses

 

 

 

 

Sales and marketing

1,547,995

 

558,743

 

3,047,310

 

1,255,695

 

General and administrative

1,927,105

 

462,116

 

2,690,187

 

844,170

 

Research and development

563,671

 

164,867

 

937,002

 

748,776

 

Amortization (Note 6)

132,458

 

31,476

 

220,711

 

62,951

 

Depreciation (Note 5)

17,434

 

8,249

 

27,283

 

24,342

 

Foreign exchange loss (gain)

6,283

 

70,334

 

7,977

 

27,352

 

Total operating expenses

4,194,946

 

1,295,785

 

6,930,470

 

2,963,287

 

 

 

 

 

 

Operating loss

(2,025,211

)

(923,964

)

(3,412,886

)

(2,224,449

)

Loss before income taxes

(2,025,211

)

(923,964

)

(3,412,886

)

(2,224,449

)

Deferred income tax recovery

24,239

 

-

 

48,478

 

-

 

Net loss

(2,000,972

)

(923,964

)

(3,364,408

)

(2,224,449

)

 

 

 

 

 

Other comprehensive income (loss)

 

 

 

 

Exchange differences on translating foreign operations

(308,552

)

-

 

179,764

 

-

 

Total comprehensive loss

(2,309,524

)

(923,964

)

(3,184,644

)

(2,224,449

)

 

 

 

 

 

 

 

 

 

 

Loss per common share

 

 

 

 

Basic and diluted loss per common share

(0.04

)

(0.02

)

(0.05

)

(0.04

)

Weighted average number of common shares outstanding

65,713,035

 

53,790,361

 

63,147,313

 

52,356,663

 


NexTech AR Solutions Corp.
Condensed Consolidated Interim Statements of Changes In Shareholders' Equity
For the six months ended June 30, 2020 and 2019
(Unaudited - Expressed in Canadian dollars)

 

 

 

 

 

 

 

 

Number of shares

Share capital

Equity portion of convertible debenture

Reserves

Deficit

Total

 

 

$

$

$

$

$

Balance, December 31, 2018

43,687,872

 

6,365,393

 

 

-

 

 

423,463

 

 

(2,345,482

)

 

4,443,374

 

Partial escrow cancellation

(400,000

)

-

 

 

-

 

 

-

 

 

-

 

 

-

 

Acquisition of AR Ecommerce LLC

2,000,000

 

1,620,000

 

 

-

 

 

-

 

 

-

 

 

1,620,000

 

Shares released from escrow for services

-

 

60,000

 

 

-

 

 

-

 

 

-

 

 

60,000

 

Shares issued for exercise of warrants

8,461,500

 

2,605,750

 

 

-

 

 

-

 

 

-

 

 

2,605,750

 

Shares issued for acquisition payable

100,000

 

66,630

 

 

-

 

 

-

 

 

-

 

 

66,630

 

Private placement

566,000

 

339,600

 

 

-

 

 

-

 

 

-

 

 

339,600

 

Stock-based compensation

-

 

-

 

 

-

 

 

523,702

 

 

-

 

 

523,702

 

Net loss

-

 

-

 

 

-

 

 

-

 

 

(2,224,449

)

 

(2,224,449

)

Balance, June 30, 2019

54,415,372

 

11,057,373

 

 

-

 

 

947,165

 

 

(4,569,931

)

 

7,434,607

 

 

 

 

 

 

 

 

Balance, December 31, 2019

60,509,250

 

15,210,041

 

 

1,025,595

 

 

1,407,330

 

 

(10,576,761

)

 

7,066,205

 

Convertible debentures

1,910,163

 

1,161,935

 

 

(1,025,595

)

 

-

 

 

(136,340

)

 

-

 

Shares issued for exercise of warrants

2,057,504

 

1,734,861

 

 

-

 

 

-

 

 

-

 

 

1,734,861

 

Shares issued for exercise of options

1,195,666

 

381,600

 

 

-

 

 

-

 

 

-

 

 

381,600

 

Shares issued for purchase of Jolokia

1,000,000

 

1,491,889

 

 

-

 

 

-

 

 

-

 

 

1,491,889

 

Shares issued to settle related party liability

47,799

 

38,239

 

 

-

 

 

-

 

 

-

 

 

38,239

 

Share-based payment

810,006

 

648,005

 

 

-

 

 

864,899

 

 

-

 

 

1,512,904

 

Private placement

1,528,036

 

3,208,876

 

 

-

 

 

-

 

 

-

 

 

3,208,876

 

Share issuance costs

-

 

(313,070

)

 

-

 

 

113,241

 

 

-

 

 

(199,829

)

Net loss

-

 

-

 

 

-

 

 

-

 

 

(3,364,408

)

 

(3,364,408

)

Translation of foreign operations

-

 

-

 

 

-

 

 

179,764

 

 

-

 

 

179,764

 

Balance as at June 30, 2020

69,058,424

 

23,562,376

 

 

-

 

 

2,565,234

 

 

(14,077,509

)

 

12,050,101

 


NexTech AR Solutions Corp.
Condensed Consolidated Interim Statements of Cash Flows
For the three and six months ended June 30, 2020 and 2019
(Unaudited - Expressed in Canadian dollars)

 

For the three months ended June 30,

For the six months ended June 30,

 

2020

2019

2020

2019

 

 

 

 

 

OPERATING ACTIVITIES

 

 

 

 

Net loss

(2,000,972

)

(923,964

)

(3,364,408

)

(2,224,449

)

 

 

 

 

 

Items not affecting cash:

 

 

 

 

Amortization of intangible assets

132,458

 

31,476

 

220,711

 

62,951

 

Deferred income tax recovery

(24,239

)

-

 

(48,478

)

-

 

Depreciation of property and equipment

17,434

 

8,249

 

27,283

 

24,342

 

Shares issued to settle related party liability

-

 

-

 

38,239

 

 

Share-based payments

861,958

 

161,851

 

1,512,904

 

523,702

 

Shares released from escrow for services

-

 

-

 

-

 

60,000

 

Option and warrant exercised shares outstanding

(183,737

)

-

 

(183,737

)

-

 

 

 

 

 

 

Changes in non-cash working capital items

 

 

 

 

Receivables

356,792

 

(262,168

)

139,547

 

(475,643

)

Prepaid expenses and deposits

23,735

 

(237,958

)

4,660

 

(647,845

)

Inventory

(83,071

)

(399,609

)

(327,881

)

(667,458

)

Accounts payable and accrued liabilities

673,907

 

(709,979

)

480,787

 

(879,459

)

Other payables

(97,771

)

-

 

(230,174

)

-

 

Net cash used in operating activities

(323,506

)

(2,332,103

)

(1,730,547

)

(4,223,858

)

 

 

 

 

 

INVESTING ACTIVITIES

 

 

 

 

Cash acquired in a business combination

-

 

-

 

-

 

128,670

 

Cash paid for acquisition of HootView

-

 

-

 

-

 

(85,664

)

Purchase of equipment

-

 

-

 

-

 

(12,125

)

Net cash used in investing activities

-

 

-

 

-

 

30,881

 

 

 

 

 

 

FINANCING ACTIVITIES

 

 

 

 

Proceeds from exercise of options and warrants

1,404,022

 

-

 

2,116,461

 

2,605,750

 

Net proceeds from private placement

3,009,047

 

339,600

 

3,009,047

 

339,600

 

Net cash provided by financing activities

4,413,069

 

339,600

 

5,125,508

 

2,945,350

 

 

 

 

 

 

Foreign exchange

(117,022

)

(266,280

)

37,892

 

(170,541

)

 

 

 

 

 

Net change in cash

3,972,541

 

(2,258,782

)

3,432,853

 

(1,418,168

)

Cash, beginning

2,309,656

 

2,487,471

 

2,849,344

 

1,646,858

 

Cash, ending

6,282,197

 

228,689

 

6,282,197

 

228,689

 

(Above excerpts from the condensed consolidated interim financial statements should be read in conjunction with the financial statement notes).


Non-IFRS Measures
This News Release makes reference to certain non-IFRS measures such as “Total Bookings” and “Backlog”. These non-IFRS measures are not recognized, defined or standardized measures under IFRS. Our definition of Total Bookings and Backlog will likely differ from that used by other companies and therefore comparability may be limited.

Total Bookings and Backlog should not be considered a substitute for or in isolation from measures prepared in accordance with IFRS. These non-IFRS measures should be read in conjunction with our condensed consolidated interim financial statements and the related notes thereto as at and for the three and six months ended June 30, 2020. Readers should not place undue reliance on non-IFRS measures and should instead view them in conjunction with the most comparable IFRS financial measures. See the reconciliations to these IFRS measures below:

 

Three months ended June 30,

 

Six months ended June 30,

 

 

2020

 

 

2019

 

 

2020

 

 

2019

Total Bookings

$

3,680,111

 

 

$

905,915

 

 

$

6,239,291

 

 

$

1,807,025

 

Total Revenue

 

3,529,029

 

 

 

905,915

 

 

 

6,021,014

 

 

 

1,807,025

 

Adjustment for bookings

 

151,082

 

 

 

-

 

 

 

218,277

 

 

 

-

 

Adjustment for backlog

 

(51,000

)

 

 

-

 

 

 

(118,195

)

 

 

-

 

Backlog

$

100,082

 

 

$

-

 

 

$

100,082

 

 

$

-

 


About NexTech AR
NexTech is one of the leaders in the rapidly growing Augmented Reality market estimated to grow from USD $10.7B in 2019 and projected to reach USD $72.7B by 2024 according to Markets & Markets Research; it is expected to grow at a CAGR of 46.6% from 2019 to 2024.

The company is pursuing four verticals:

InfernoAR: An advanced Augmented Reality and Video Learning Experience Platform for Events, is a SaaS video platform that integrates Interactive Video, Artificial Intelligence and Augmented Reality in one secure platform to allow enterprises the ability to create the world’s most engaging virtual event management and learning experiences. Automated closed captions and translations to over 64 languages. According to Grandview Research the global virtual events market in 2020 is $90B and expected to reach more than $400B by 2027, growing at a 23% CAGR. With NexTech’s InfernoAR platform having augmented reality, AI, end-to-end encryption and built in language translation for 64 languages, the company is well positioned to rapidly take market share as the growth accelerates globally.

ARitize™ For eCommerce: The company launched its SaaS platform for webAR in eCommerce early in 2019. NexTech has a ‘full funnel’ end-to-end eCommerce solution for the AR industry including its Aritize360 app for 3D product capture, 3D/AR ads, its Aritize white label app, its ‘Try it On’ technology for online apparel, 3D and 360-degree product views, and ‘one click buy’.

ARitize™ 3D/AR Advertising Platform: Launched in Q1 2020 the ad platform will be the industry's first end-to-end solution whereby the company will leverage its 3D asset creation into 3D/AR ads. In 2019, according to IDC, global advertising spend will be about $725 billion.

ARitize™ Hollywood Studios: The studio is in development producing immersive content using 360 video, and augmented reality as the primary display platform.

To learn more, please follow us on Twitter, YouTube, Instagram, LinkedIn, and Facebook, or visit our website: https://www.nextechar.com.

On behalf of the Board of NexTech AR Solutions Corp.
Evan Gappelberg
CEO and Director

For further information, please contact:

Evan Gappelberg
Chief Executive Officer
info@nextechar.com

The CSE has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Certain information contained herein may constitute “forward-looking information” under Canadian securities legislation. Generally, forward-looking information can be identified by the use of forward-looking terminology such as, “will be”, “looking forward” or variations of such words and phrases or statements that certain actions, events or results “will” occur. Forward-looking statements regarding the Company increasing investors awareness are based on the Company’s estimates and are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, levels of activity, performance or achievements of NexTech to be materially different from those expressed or implied by such forward-looking statements or forward-looking information, including capital expenditures and other costs. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements and forward-looking information. NexTech will not update any forward-looking statements or forward-looking information that are incorporated by reference herein, except as required by applicable securities laws.