CALGARY, ALBERTA–(Marketwired – May 26, 2014) – Quorum Information Technologies Inc. (TSX VENTURE:QIS) (“Quorum” or the “Company”) today released its First Quarter (Q1) Fiscal Year (FY) 2014 results. Quorum delivers its dealership management system (DMS), XSellerator™, and related services to automotive dealerships throughout North America. The Company is both a Dealer Technology Assistance Program (DTAP) strategic partner with General Motors Corporation (GM) and a strategic partner with Microsoft. Quorum's XSellerator product is broadly promoted to its target dealerships throughout North America by these prominent industry partners. Quorum also supplies its product to Chrysler, Hyundai, Kia, Nissan, Subaru, NAPA and Bumper to Bumper franchised dealership customers as well as independent and other non-automotive dealerships.
Maury Marks, Quorum's President and CEO made the following remarks about the Company's Q1 FY2014 results. Some of our most significant measurable operational results in Q1 FY2014 are as follows:
- Customer Satisfaction Index (“CSI”) semi-annual survey in Q1 FY2014 showed an average of 88% of dealer principals as “satisfied” or “very satisfied” and an average of 81% of end users as “satisfied” or “very satisfied” overall. The remaining 12% of dealer principals reported “somewhat satisfied” and over 3/4 of the remaining 25% of end users reported “somewhat satisfied”. The results are up from our survey in Q3 FY2013 which reported “satisfied” or “very satisfied” comparative numbers of 87% for dealer principals and 75% for end users.
- Customers Satisfaction Index (CSI) – our monthly Support Center CSI survey reported an average of over 95% “very satisfied” with the service received from our support team.
- Product – during Q1 FY2014 we continued work on V4.7.7 which we plan to move into general release in Q2 FY2014. The version has new Make More Money (“M3”) initiatives that will help drive additional incremental revenue into our dealership customers' operations. The version also has a number of enhancements to Communicator, our 2 way text, email and instant messaging solution that is embedded into XSellerator. Our Dealership customers sent 183,652 messages in Q1 FY2014 compared to 79,621 in Q4 FY2013 through Communicator.
Financial Results highlights for Q1 FY2014 are as follows:
- Sales increased by 12% to $2,202K in Q1 FY2014 from $1,959K in Q1 FY2013. The increase in sales is largely due to:
- An increase of $96K in recurring support revenue as a result from having more active dealership rooftops at the end of Q1 FY2014 compared to the end of Q1 FY2013.
- An increase of $175K in net new and transitions revenue which was a result of an increase in transitions revenue.
- Margin after direct costs increased by $256K to $1,288K in Q1 FY2014, as compared to $1,032K in Q1 FY2013, a 25% increase.
- Earnings before interest, taxes, depreciation, amortization, foreign exchange gains and losses and stock-based compensation (EBITDA) increased by $220K to $378K in Q1 FY2014 compared to $158K in Q1 FY2013.
- Income before deferred income tax expense increased by $206K to $168K in Q1 FY2014 compared to a loss of $38K in Q1 FY2013.
- Quorum had comprehensive income of $137K in Q1 FY2014 compared to a comprehensive loss of $12K in Q1 FY2013. The improvement is largely due to an increase in EBIDTA of $220K, offset by a combined increase in deferred income tax expense and amortization expense of $90K.
- Working capital increased to $1,526K at March 31, 2014 compared with $1,454K at December 31, 2013. Cash increased to $942K at the end of March, 2014 compared with $812K at the end of December, 2013.
Q1 FY2014 was a strong quarter with revenues up 12% to $2,202K, a 140% increase in EBITDA to $378K, and an increase in income before deferred income tax expense of $206.
Quorum has filed its Q1 2014 consolidated financial statements and notes thereto as at and for the period ended March 31, 2014 and accompanying Management's Discussion and Analysis in accordance with National Instrument 51-102 – Continuous Disclosure Obligations adopted by the Canadian securities regulatory authorities. Additional information about Quorum will be available on Quorum's SEDAR profile at www.sedar.com and Quorum's website at www.QuorumDMS.com.
Financial Highlights
| Three Months Ended March 31, 2014 | Three Months Ended March 31, 2013 | |||||
| Gross revenue | $ | 2,202,327 | $ | 1,959,291 | ||
| Direct costs | 914,596 | 927,198 | ||||
| Margin after direct costs | 1,287,731 | 1,032,093 | ||||
| Earnings before interest, taxes, depreciation and amortization (EBITDA) | 378,117 | 157,558 | ||||
| Income (loss) before deferred income tax expense | 168,464 | (37,663 | ) | |||
| Net income (loss) | 82,221 | (48,166 | ) | |||
| Comprehensive income (loss) | 136,579 | (12,415 | ) | |||
| Basic income (loss) per share | 0.0021 | (0.0012 | ) | |||
| Fully diluted income (loss) per share | $ | 0.0021 | $ | (0.0012 | ) | |
| Weighted average number of common shares | ||||||
| Basic | 39,298,438 | 39,298,438 | ||||
| Diluted | 39,298,438 | 39,298,438 | ||||
About Quorum
Quorum is a North American company focused on developing, marketing, implementing and supporting its XSellerator product for GM, Chrysler, Hyundai, KIA, Nissan, Subaru, NAPA and Bumper to Bumper dealerships. XSellerator is a dealership and customer management software product that automates, integrates and streamlines every process across departments in a dealership. One of the select North American suppliers under General Motors' DTAP program, Quorum is also one of largest DMS provider for GM's Canadian dealerships with 25% of the market. Quorum is a Microsoft Partner in both Canada and the United States. Quorum Information Technologies Inc. is traded on the Toronto Venture Exchange (TSX-V) under the symbol QIS. For additional information please go to www.QuorumDMS.com.
Forward-Looking Information
This press release contains certain forward-looking statements and forward-looking information (“forward-looking information”) within the meaning of applicable Canadian securities laws. Forward-looking information is often, but not always, identified by the use of words such as “anticipate”, “believe”, “plan”, “intend”, “objective”, “continuous”, “ongoing”, “estimate”, “expect”, “may”, “will”, “project”, “should” or similar words suggesting future outcomes. In particular, this press release includes forward-looking information relating to results of operations, plans and objectives, projected costs and business strategy. Quorum believes the expectations reflected in such forward-looking information are reasonable but no assurance can be given that these expectations will prove to be correct and such forward-looking information should not be unduly relied upon.
Forward-looking information is not a guarantee of future performance and involves a number of risks and uncertainties some of which are described herein. Such forward-looking information necessarily involves known and unknown risks and uncertainties, which may cause Quorum's actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward-looking information. These risks and uncertainties include but are not limited to the risks identified in Quorum's Management's Discussion and Analysis for the period ended March 31, 2014. Any forward-looking information is made as of the date hereof and, except as required by law, Quorum assumes no obligation to publicly update or revise such information to reflect new information, subsequent or otherwise.
The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.
Contact Information:
Maury Marks
403-777-0036 ext 104
MarksM@QuorumDMS.com
