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WeCommerce Reports Fiscal 2020 Third Quarter Results for Former Operating Company

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WeCommerce Holdings Ltd (the "Company") (TSXV: WE) today announced that the unaudited financial results of its former operating entity for the quarter ended September 30, 2020 ("Q3 2020") have been filed on SEDAR. These financial statements are for a period prior to concluding the Company’s December 9, 2020 reverse takeover of Brachium Capital Corp. and do not represent the current consolidated financial position of the Company. The financial statements can be viewed under the Company’s profile on www.sedar.com.

Q3 2020 Highlights

  • Total revenues for Q3 2020 increased by $2,037,507 or 52.2% over the same period in 2019

  • Net income after tax for Q3 2020 increased by $122,256 or 30.7% over the same period in 2019

  • EBITDA1 for Q3 2020 increased by $751,178 or 64.7% over the same period in 2019

  • Adjusted EBITDA1 for Q3 2020 increased by $807,988 or 61.2% over the same period in 2019

  • Q3 2020 includes three full months of operating results and EBITDA contribution of Foursixty Inc

Q3 2020 Financial Results

Three-month period
ended September 30,

Nine-month period
ended September 30,

2020

2019

2020

2019

Revenue

Recurring subscription revenue

2,082,268

1,100,976

4,655,216

3,079,072

Digital goods revenue

2,551,977

1,782,485

6,948,897

5,288,193

Agency service revenue

1,306,245

1,019,522

3,811,715

2,795,985

5,940,490

3,902,983

15,415,828

11,163,250

Operating income

1,063,448

620,889

2,304,044

905,818

Net income

520,504

398,248

1,332,224

438,416

Basic earnings per share

0.38

0.38

1.11

0.36

Diluted earnings per share

0.38

0.37

1.10

0.36

EBITDA(1)

1,912,418

1,161,240

4,497,696

2,546,721

EBITDA %

32%

30%

29%

22%

Adjusted EBITDA(1)

2,128,609

1,320,621

4,962,774

2,815,568

Adjusted EBITDA %

36%

34%

32%

25%

Notes:

1. See "Non-IFRS financial measures" for further information.

Total revenues for the three-month period ended September 30, 2020 increased by $2,037,507 or 52.2% over the same period in 2019. Revenues for our Apps segment increased by $981,292 for the three-month period ended September 30, 2020 compared to the same period in 2019. Apps revenue includes $864,702 of additional revenue contributed by Foursixty Inc during the 2020 period. Revenues for our Themes segment increased by $769,492 for the three-month period ended September 30, 2020 compared to the same period in 2019. The increase in revenues in 2020 can be attributed to an increase in customer demand for these services as the economy saw a shift to online shopping as a result of the COVID-19 pandemic and social distancing measures. Revenues for our Agency segment increased by $286,723 for the three-month period ended September 30, 2020 compared to the same period in 2019. This increase can be attributed to the purchase of Rehash in October 2019 as well as organic departmental growth in core agency sales.

"We are pleased with our third quarter results, which include our first full quarter of Foursixty," said Chris Sparling, WeCommerce Chief Executive Officer. "As a result of the COVID-19 pandemic, the quarter saw increased adoption of ecommerce and associated revenues in all our divisions."

Financial Statements

WeCommerce’s unaudited Interim Consolidated Financial Statements and Management’s Discussion and Analysis ("MD&A") for Q3 2020 are available on the Company’s Website at https://www.wecommerce.co or on SEDAR at www.sedar.com.

About WeCommerce Holdings Ltd

WeCommerce is a holding company that owns a family of companies and brands in the Shopify partner ecosystem, including Pixel Union, Out of the Sandbox, Yopify, SuppleApps, Rehash and Foursixty. The Company’s primary focus is to build, grow and acquire businesses that serve the Shopify Partner ecosystem. These businesses consist largely of Software as a Service, Digital Goods and Services businesses. Generally, these businesses build Apps and Themes and run Agencies that support Shopify merchants.

WeCommerce is focused on acquiring businesses with growth potential, a sustainable competitive advantage and that are, or have the potential to become, a leader within their particular market. The Company targets businesses within the Shopify ecosystem due to its confidence in the Shopify platform, the fragmented nature of the ecosystem and the attractive economics that the businesses generally exhibit. As one of Shopify’s first partners since 2010, WeCommerce believes it is well positioned to continue to identify acquisition opportunities in the Shopify Partner ecosystem.

Non-IFRS financial measures

This news release makes reference to certain non-IFRS measures. These measures are not recognised measures under IFRS, and do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of our results of operations from management’s perspective. Accordingly, these measures should not be considered in isolation nor as a substitute for analysis of our financial information reported under IFRS. We use non-IFRS measures including "EBITDA" and "Adjusted EBITDA". Management uses these non-IFRS measures in order to facilitate operating performance comparisons from period to period, to prepare annual operating budgets and forecasts and to determine components of management compensation. As required by Canadian securities laws, we reconcile these non-IFRS measures to the most comparable IFRS measures in our MD&A for Q3 2020.

Forward looking Information

This news release may contain "forward-looking information" within the meaning of applicable securities laws in Canada. Forward-looking-information may relate to WeCommerce’s future financial outlook and anticipated events or results and may include information regarding its financial position, business strategies, budgets, operations, financial results, taxes, dividend policy, plans and objectives. Particularly, information regarding the Company’s expectations of future results, performance, achievements, prospects or opportunities or the markets in which it operates is forward-looking information. In some cases, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "targets", "expects" or "does not expect", "is expected", "an opportunity exists", "budget", "scheduled", "estimates", "outlook", "forecasts", "projection", "prospects", "strategy", "intends", "anticipates", "does not anticipate", "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might", "will", "will be taken", "occur" or "be achieved". In addition, any statements that refer to expectations, intentions, projections or other characterizations of future events or circumstances contain forward-looking information. Statements containing forward-looking information are not historical facts but instead represent management's expectations, estimates and projections regarding future events or circumstances. If any of the opinions, estimates or assumptions underlying the forward-looking information prove incorrect, actual results or future events might vary materially from those expressed in the forward-looking information. The Company has no obligation or undertaking to update or revise any forward-looking information whether as a result of new information, future events or otherwise, except as required under applicable securities laws in Canada. Actual results and the timing of events may differ materially from those anticipated in the forward-looking information as a result of various factors, including those described in "Risk Factors" which are described in the Company's most recent Management’s discussion and Analysis ("MD&A") filed on SEDAR (www.sedar.com).

We caution that the list of risk factors and uncertainties is not exhaustive and other factors could also adversely affect our results. Readers are urged to consider the risks, uncertainties and assumptions carefully in evaluating the forward-looking information and are cautioned not to place undue reliance on such information. See "Forward-looking Information" and "Risk Factors" in the Company's most recent Management's Discussion & Analysis available on SEDAR for a discussion of the uncertainties, risks and assumptions associated with these statements.

View source version on businesswire.com: https://www.businesswire.com/news/home/20201217006207/en/

Contacts

Evan Brown, Chief Financial Officer
evan@wecommerce.co
250-888-9424