WaveDancer Releases First Quarter 2022 Results

WaveDancer Releases First Quarter 2022 Results


FAIRFAX, Virginia, May 16, 2022 (GLOBE NEWSWIRE) – WaveDancer (NASDAQ: WAVD) today reported its results for the first quarter ended March 31, 2022, which was characterized by continued investment in WaveDancer software development and sales team. . This included new hires, board appointments, partnerships, and a final acquisition agreement as WaveDancer strives to become a market leader in the zero trust, blockchain, and secure supply chain market.

WaveDancer CEO Jamie Benoit commented: “Our first quarter of 2022 saw the company continue to prioritize investments in key operating areas. senior management, we’ve also added three new blockchain sales professionals, as well as six engineers and developers. “

Mr. Benoit continued: “Our lower revenues during the first quarter of 2021 are the result of our continued efforts in the Tellenger business to move away from the distribution and resale of low margins and to higher-margin professional service opportunities. “.

Highlighted financial data for the first quarter of 2022 (all comparisons with the previous year’s period unless otherwise noted)

  • Total revenue decreased 12.4% to $ 3.0 million, compared to $ 3.4 million.
  • Professional fees fell 15.3% to $ 2.1 million, from $ 2.4 million.
  • Gross profit fell to $ 0.4 million, compared to $ 1.0 million.
  • Gross margin widened to 12.6%; higher-margin professional fees accounted for 69.0% of revenue.
  • Net loss of (2.1) million dollars, compared to net income of 0.3 million dollars.
  • EBITDA adjusted1 of (1.7) million dollars, compared to 0.4 million dollars.

About WaveDancer

WaveDancer (www.wavedancer.com), based in Fairfax, Virginia, is a zero-trust software solution provider specializing in secure supply chain management (SCM), asset tracking and security. Our technologies are deployed and used to help organizations manage highly complex supply chain challenges. Originally developed to secure a complex international supply chain for a U.S. government global security organization (USG), the technology has matured to address multiple operational capabilities. Customers are using the WaveDancer platform to achieve unprecedented levels of accountability, auditability and predictability of their data, while providing information to their partners and suppliers through a distributed and controlled register that is immutable and in which all parties they can trust. Sophisticated blockchain technology is now available to the entire USG via GovCloud.

________________________________

1 See Non-GAAP reconciliation on page 6

Additional information for investors
This statement may contain forward-looking statements about the company’s business, customer outlook or other factors that may affect future earnings or financial results. These statements involve risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. Investors should read and understand the risk factors detailed in the company’s 10-K for the fiscal year ended December 31, 2021 and in other documents submitted to the Stock and Securities Commission.

For additional information contact:
Jeremy Hellman, CFA
Vice President
The Equity Group
(212) 836-9626
jhellman@equityny.com

WAVEDANCER, INC. AND SUBSIDIARIES
CONSOLIDATED ACCOUNTS FOR OPERATIONS AND OVERALL RESULTS

Three months ended March 31,
2022 2021
Income
Professional fees $ 2,066,690 $ 2,439,259
Software sales 928,822 980,321
Total income 2,995,512 3,419,580
Cost of income
Cost of professional fees 1,712,015 1,467,699
Cost of selling software 907,432 932,231
Total cost of income 2,619,447 2,399,930
Gross benefits 376,065 1,019,650
Commercial, general and administrative expenses 2,714,342 680,250
Acquisition costs 434,702 70,530
(Loss) operating income (2,772,979 )

268,870

Other income (expenses):
Interest expenses (19,319 ) (1,459 )
Other income (expenses), net (12,015 ) 3,404
(Loss) income before provision for income taxes (2,804,313 ) 270,815
Income tax benefit (726.006 )
Net income (loss) $ (2,078,307 ) $ 270,815
Comprehensive income (loss) $ (2,078,307 ) $

270,815

Basic (loss) / earnings per share $ (0.12 ) $ 0.02
(loss) / diluted earnings per share $ (0.12 ) $ 0.02
Weighted average of ordinary shares outstanding
Basic 17,294,808 11,282,671
Diluted 17,294,808 12,286,216

WAVEDANCER, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS

March 31,
2022
December 31,
2021
ASSETS
Current assets
Cash and cash equivalents $ 2,999,201 $ 4,931,302
Accounts receivable 1,672,072 1,664,862
Advance expenses and other current assets 458,719 276,990
Total current assets 5,129,992 6,873,154
Intangible assets, net of accumulated depreciation of $ 201,032 and $ 0 7,699,075 8,048,968
Good will 7,585,269 7,585,269
Operating leases with the right to use 627,977 672,896
Tangible fixed assets, net of accumulated depreciation of $ 347,886 and $ 312,320 103,577 105,256
Other assets 77,100 77,100
Total assets $ 21,222,990 $ 23,362,643
PASSIVE NET EQUITY
Current liabilities
Accounts payable $ 302,323 $ 650,499
Accrued payroll and related liabilities 611,497 524,055
Commissions payable 250,043 224,250
Other accrued liabilities 816,536 204,080
Contractual obligations 149,692 186,835
Liability for operating lease – current 192,128 192,128
Total current liabilities 2,322,219 1,981,847
Liability for operating lease – non-current 460,505 507,120
Deferred income taxes 441,498 1,167,504
Other liabilities 2,296,928 2,265,000
Total liabilities 5,521,150 5,921,471
Net worth
Ordinary shares at $ 0.001 and a par value of $ 0.01; 100,000,000 and 30,000,000 authorized shares, 18,882,313 and 12,904,376 shares issued, 17,239,697 and 11,261,760 shares outstanding, as of December 31, 2021 and respectively 18,987 18,882
Additional payment in capital 32,128,334 31,789,464
Accumulated deficit (15,515,270 ) (13,436,963 )
Treasury stock, 1,642,616 shares at the price (930,211 ) (930,211 )
Total shareholders’ equity 15,701,840 17,441,172
Total liabilities and equity $ 21,222,990 $ 23,362,643

Non-GAAP financial measures
To evaluate the performance of our business, management uses a variety of financial and performance measures. The key measure is adjusted EBITDA, a non-GAAP financial measure. We define adjusted EBITDA as net income (loss) plus amortization and depreciation expense, interest expense (income) and taxes, as adjusted more to eliminate the impact of, where applicable, expenses that are unusual or non-recurring that we believe do. they do not reflect our basic operating results. and share-based non-cash compensation. We believe that adjusted EBITDA is significant for our investors to improve their understanding of our financial performance during the current period and our ability to generate cash flows from transactions that are available for tax, capital expenditures. and debt service. We understand that adjusted EBITDA is frequently used by securities analysts, investors, and other stakeholders as a measure of financial performance and to compare our performance with that of other companies reporting adjusted EBITDA. However, our adjusted EBITDA calculation may not be comparable to measures with a similar title reported by other companies. When assessing our operating performance, investors and others should not consider this data in isolation or as a substitute for net income (loss) calculated in accordance with GAAP. In addition, the results presented by the adjusted EBITDA cannot be achieved without incurring the costs that the measure excludes. The following is a reconciliation of net income (loss) with adjusted EBITDA, the most comparable GAAP measure.

Reconciliation of net profit (loss) with adjusted EBITDA
(in thousands) Three months over
March 31,
2022
2021
Net income (loss) $ (2,078 ) $ 271
Adjustments:
Interest expense (income), net 19 (2 )
Tax expense (benefit). (726 )
Depreciation 13 5
Depreciation 350
EBITDA (2,422 ) 274
Non-cash compensation based on shares 312 28
Acquisition costs 435 71
Post-employment agreement 36
EBITDA adjusted $ (1,675 ) $ 408



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