ProntoForms Reports Q2 2023 Financial Results
Growth in TTM ARR Accelerates to 19% and Operating Loss Declines
OTTAWA, July 26, 2023 (GLOBE NEWSWIRE) -- ProntoForms Corporation (TSXV: PFM), the global leader in field intelligence, announced today its second quarter (Q2) financial results for the period ended June 30, 2023. All amounts are in US dollars unless otherwise stated.
“Our Trailing Twelve Months (“TTM”) revenue growth accelerated to 14% from 11.5% in the last quarter, and TTM annual recurring revenue (“ARR”) base growth to 19% from 13% last quarter, with first half net bookings results exceeding all of 2022. The company reported strong subscription growth in the second quarter of 2023 based on a large win, good growth in existing accounts, and the highest level of revenue retention in two years. We continue to focus on four key vertical markets where we can deliver a considerable return on investment to customers through reduced field service costs, richer data, and higher levels of compliance as shown by our recent $3M win in the medical device industry,” said Philip Deck, co-CEO of ProntoForms.
“Consistent with our disclosure last quarter, our lower operating loss still included costs related to organizational changes. These were necessary to support changes made across our operations as we reconfigured our workforce for higher growth and profitability. We anticipate that most of the organizational changes are behind us and remain focused on reaching non-GAAP operating profitability by Q4,” he added.
“In today’s economy, field technicians generate substantial high-margin revenue for their organizations and play a crucial role in delivering customer satisfaction. They also amass valuable data through their job interactions, generating insights that enable new levels of team and process efficiency. However, with the new guard increasingly prizing job satisfaction as part of a generational shift in the industry, they are favouring roles built around their needs more and more. Therefore, it is critical for organizations with significant field service operations to prioritize the technician experience. Our product excels in consolidating this wealth of information while enhancing technician satisfaction and operational productivity. Our name change to TrueContext slated for later this year reflects our wider repositioning as a leader in enterprise field intelligence,” ProntoForms co-CEO and Founder Alvaro Pombo explained.
Financial Highlights – 2023 Second Quarter (All results in USD)
Recurring revenue in Q2 2023 increased by 16% to $5.79 million compared to $4.97 million in Q2 2022 and increased by 7% compared to $5.43 million in Q1 2023.
Total revenue for Q2 2023 increased by 17% to $6.12 million compared to $5.21 million in Q2 2022 and increased by 6% compared to $5.77 million in Q1 2023.
Gross margin for Q2 2023 was 86% of total revenue compared to 84% in Q2 2022 and 86% in Q1 2023. Gross margin on recurring revenue was 91% for Q2 2023 compared to 89% in Q2 2022 and 90% in Q1 2023.
Operating loss for Q2 2023 was $0.97 million, down from an operating loss of $1.32 million in Q2 2022 and down from an operating loss of $1.04 million in Q1 2023.
Net loss for Q2 2023 was $1.15 million, down from a net loss of $1.34 million in Q2 2022 and up from a net loss of $1.13 million in Q1 2023.
As at June 30, 2022, the Company’s cash and net working capital balances were $6.25 million and $1.06 million respectively.
Please refer to https://www.prontoforms.com/company/investor-relations for full financial statements, management discussion and analysis and a downloadable spreadsheet version of our quarterly information.
Recent Operational Highlights
Notable new and expansion progress from enterprise customers, including:
A subsidiary of a global Fortune 500 medical manufacturing company committed to just over $3M in subscription services over 3.5 years from April 2023 to manage workflows for new machine installations worldwide.
A Fortune 500 distributor of a large heavy equipment manufacturer deployed ProntoForms for over $95K ARR to support job safety analysis, work orders, and site safety reviews.
A Fortune Global 500 leader in fire, HVAC, and security equipment added 500 new subscriptions. This expansion will support various initiatives including HVAC and building automation, energy management, and emissions reporting and management.
Other Highlights
ProntoForms shareholders approved the name change to TrueContext Corporation as well as the appointment of directors, auditors, and options plan at the annual meeting held June 21, 2023.
ProntoForms launched a multi-language add-on that enables multiple language options within a single workflow, creating a universal approach to field work that supports global and diverse field teams.
ProntoForms attended the Canadian Elevator Contractors Association (CECA) Convention for the first time after becoming a member earlier this year. At the show, ProntoForms unveiled it’s Elevate solution that is tailored to address challenges faced by elevator field teams.
Q2 Conference Call Date:
Date: Tuesday, July 26th, 2023
Time: 9:00 AM Eastern Time
Participant Login Options
To join the conference call without operator assistance, you may register and enter your phone number at: https://emportal.ink/44NZOZE to receive an instant automated callback.
You can also dial direct to be enter the call through an operator with the details below:
Participant Dial-in Numbers:
Local Toronto – (+1) 416-764-8650
Toll Free – (+1) 888-664-6383
Recording Playback Numbers:
Local Toronto– (+1) 416-764-8677
Toll Free – (+1) 888-390-0541
Passcode: 885407
Expiry Date: August 2nd, 2023, at 11:59pm EST
About ProntoForms Corporation
ProntoForms, soon to be TrueContext, is the global leader in field intelligence. The platform’s field workflows and data collection capabilities enable enterprise field teams to optimize decision-making, decrease organizational risk, maximize the uptime of valuable assets, and deliver exceptional service experiences. Over 100,000 subscribers use ProntoForms across multiple use cases, including asset inspection, compliance, installation, repair, maintenance, and environmental, health & safety with quantifiable business impacts.
The Company is based in Ottawa, Canada, and trades on the TSXV under the symbol PFM. ProntoForms is the registered trademark of ProntoForms Inc., a wholly owned subsidiary of ProntoForms Corporation
For additional information, please contact:
Alvaro Pombo | Philip Deck | Dave Croucher |
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Certain information in this press release may constitute forward-looking information. For example, statements about the Company’s future growth or value, the revenues anticipated to be received by the Company from recent contracts referred to above and anticipated market trends are forward-looking information. This information is based on current expectations that are subject to significant risks and uncertainties that are difficult to predict. Actual results might differ materially from results suggested in any forward-looking statements. The Company’s business and value may not grow as anticipated or at all, revenue anticipated from contracts may not be received due to many risks, including factors specific to the customer, and anticipated market trends may not occur or continue. Historical growth levels and results may not be indicative of future growth levels or results. The Company assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward looking-statements unless and until required by securities laws applicable to the Company. There are a number of risk factors that could cause future results to differ materially from those described herein. Please see “Risk Factors Affecting Future Results” in the Company’s annual management discussion and analysis dated March 9, 2022 found at www.sedar.com for a discussion of such factors.
ARR is calculated as the annual equivalent of the recurring elements of our contracts with customers that are in effect at the end of the period. It excludes one-time professional service fees and assumes that customers will renew the contractual commitments on a periodic basis as those commitments come up for renewal, unless such renewal is known to be unlikely at period end. Please also refer to the Company’s management discussion and analysis for the year ended December 31, 2022 for a description of how the Company determines and uses ARR.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
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PRONTOFORMS CORPORATION |
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Condensed Interim Consolidated Statements of Loss and Comprehensive Loss | ||||||||||
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For the three and six months ended June 30, 2023 and 2022 | ||||||||||
(in US dollars) |
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| Three Months Ended June 30, | |||||
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| 2023 |
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| 2022 |
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Revenue: |
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| Recurring revenue | $ | 5,788,346 |
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| $ | 4,968,802 |
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| Professional and other services |
| 335,246 |
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| 242,814 |
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| 6,123,592 |
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| 5,211,616 |
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Cost of revenue (1): |
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| Recurring revenue |
| 529,535 |
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| 555,304 |
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| Professional and other services |
| 312,520 |
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| 262,132 |
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| 842,055 |
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| 817,436 |
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Gross margin |
| 5,281,537 |
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| 4,394,180 |
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Expenses: |
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| Research and development (1) |
| 1,796,044 |
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| 1,814,774 |
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| Selling and marketing (1) |
| 3,219,246 |
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| 2,922,742 |
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| General and administrative (1) |
| 1,235,504 |
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| 973,382 |
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| 6,250,794 |
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| 5,710,898 |
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Loss from operations |
| (969,257 | ) |
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| (1,316,718 | ) | |||
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Foreign exchange loss |
| (93,217 | ) |
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| 29,212 |
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Finance Income |
| 38,585 |
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| 5,451 |
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Finance costs |
| (127,693 | ) |
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| (60,578 | ) | |||
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Net loss and comprehensive loss | $ | (1,151,582 | ) |
| $ | (1,342,633 | ) | |||
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Net loss and comprehensive loss |
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| per common share basic and diluted | $ | (0.01 | ) |
| $ | (0.01 | ) | ||
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Weighted average number of common shares |
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| basic and diluted |
| 130,291,419 |
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| 128,278,739 |
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(1) Amounts include share-based compensation expense as follows: | ||||||||||
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Cost of revenue | $ | 3,267 |
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| $ | 6,199 |
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Research and development |
| 38,462 |
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| 50,964 |
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Selling and marketing |
| 53,499 |
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| 35,429 |
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General and administrative |
| 189,635 |
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| 152,684 |
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Total share-based compensation expense | $ | 284,863 |
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| $ | 245,277 |
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PRONTOFORMS CORPORATION |
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Condensed Interim Consolidated Statements of Financial Position |
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as at June 30, 2023 and December 31, 2022 |
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(in US dollars) |
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| June 30, |
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| December 31, |
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| 2023 |
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| 2022 |
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Assets |
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Current assets: |
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| Cash and cash equivalents | $ | 6,251,277 |
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| $ | 6,112,071 |
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| Accounts receivable |
| 2,248,579 |
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| 4,179,088 |
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| Investment tax credits receivable |
| 151,060 |
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| 197,553 |
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| Unbilled receivables |
| 185,529 |
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| 88,453 |
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| Related party loan receivable |
| 81,158 |
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| 79,331 |
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| Prepaid expenses and other receivables |
| 1,878,757 |
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| 1,077,015 |
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| Contract acquisition costs |
| 484,856 |
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| 311,494 |
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| 11,281,216 |
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| 12,045,005 |
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Property, plant and equipment |
| 387,323 |
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| 286,834 |
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Contract acquisition costs |
| 460,616 |
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| 190,585 |
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Right-of-use asset |
| 1,033,645 |
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| 148,515 |
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| $ | 13,162,800 |
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| $ | 12,670,939 |
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Liabilities and Shareholders' Equity |
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Current liabilities: |
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| Accounts payable and accrued liabilities | $ | 2,704,132 |
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| $ | 2,686,288 |
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| Deferred revenue |
| 7,254,692 |
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| 6,508,986 |
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| Lease obligation |
| 261,264 |
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| 172,947 |
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| 10,220,088 |
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| 9,368,221 |
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Long-term debt |
| 6,152,006 |
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| 6,007,585 |
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Deferred revenue |
| 260,342 |
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| - |
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Lease obligation |
| 900,214 |
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| - |
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| 7,312,562 |
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| 6,007,585 |
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Shareholders' deficit: |
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| Share capital |
| 32,290,967 |
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| 32,166,781 |
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| Contributed surplus |
| 864,907 |
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| 864,907 |
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| Share-based payment reserve |
| 3,888,925 |
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| 3,398,246 |
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| Deficit |
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| (41,599,084 | ) |
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| (39,319,236 | ) | ||
| Accumulated other comprehensive income |
| 184,435 |
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| 184,435 |
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| (4,369,850 | ) |
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| (2,704,867 | ) | |
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| $ | 13,162,800 |
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| $ | 12,670,939 |
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PRONTOFORMS CORPORATION |
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Condensed Interim Consolidated Statements of Cash Flows | ||||||||||
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For the three and six months ended June 30, 2023 and 2022 | ||||||||||
(in US dollars) |
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| Three months ended June 30, | |||||
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| 2023 |
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| 2022 |
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Cash used in: |
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Operating activities: |
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| Net loss | $ | (1,151,582 | ) |
| $ | (1,342,628 | ) | ||
| Items not involving cash: |
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| Share-based compensation |
| 284,863 |
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| 315,836 |
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| Accretion on lease obligations |
| 10,209 |
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| 5,179 |
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| Accretion of transaction costs |
| 2,809 |
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| 3,663 |
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| Amortization of property, plant and equipment |
| 36,608 |
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| 37,061 |
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| Amortization of right-of-use asset |
| 58,026 |
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| 63,657 |
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| Unrealized foreign exchange loss |
| 92,402 |
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| (97,982 | ) | |
| Other finance costs |
| 76,085 |
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| 51,464 |
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| Interest paid |
| (114,670 | ) |
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| (56,915 | ) | ||
| Interest received |
| 38,585 |
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| 5,451 |
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| Changes in non-cash operating working capital items |
| (44,230 | ) |
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| 391,957 |
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| (710,895 | ) |
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| (623,257 | ) |
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Financing activities |
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| Payment of lease obligations |
| (65,184 | ) |
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| (75,179 | ) | ||
| Lease interest paid |
| (10,209 | ) |
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| (5,179 | ) | ||
| Procceds from drawdown of credit facility |
| - |
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| 776,000 |
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| Proceeds from the exercise of options |
| 69,836 |
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| 125,575 |
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| (5,557 | ) |
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| 821,217 |
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Investing activities |
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| Purchase of property, plant and equipment |
| (141,432 | ) |
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| (26,599 | ) | ||
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| (141,432 | ) |
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| (26,599 | ) |
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Effect of exchange rate changes on cash |
| 67,231 |
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| (85,262 | ) | |||
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Increase in cash and cash equivalents |
| (790,653 | ) |
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| 86,099 |
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Cash and cash equivalents, beginning of period |
| 7,041,930 |
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| 7,431,964 |
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Cash and cash equivalents, end of period | $ | 6,251,277 |
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| $ | 7,518,063 |
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