Vancouver, Canada, April 28, 2023 ― Perk Labs Inc. (CSE: PERK / OTCQB: PKLBF / FKT: PKLB) (“Perk” or the “Company”) today announced financial results for the first quarter ended February 28, 2023.
Overview
For the first quarter ending February 28, 2023, the Company implemented cost reduction measures and explored strategic options with advice from James Edward Capital Corporation, signed a non-binding letter of intent to merge with Getit Technologies Inc. (“Getit”), and later signed a binding letter of intent. The Company also underwent a CFO transition, engaged Independent Trading Group for market-making services, and received a notice of allowance for a US patent application.
“Since becoming CEO on March 2, 2023, my primary focus has been to streamline the Company’s operations and develop a clear and concise strategy for growth. I am proud to say that we have made significant progress in these areas and am confident our efforts will be reflected in much more positive results in our next quarter,” said Ryan Hardy, Perk CEO, “We believe that by focusing on signing new enterprise clients and leveraging the synergies of both Perk and Getit, the Company is well-positioned to achieve much greater success in the upcoming quarter. By prioritizing enterprise sales and strategic partnerships, we are confident our efforts will result in improved results and generate significant value for our stakeholders.”
2023 Q1 Financial Highlights:
- Revenue of $2,708 in Q1 2023 compared to $8,982 in Q1 2022
- Net loss of $152k in Q1 2023 compared to loss of $406k in Q1 2022.
- General and administrative expenses decreased significantly from $277k in Q1 2022 to $199k in Q1 2023 as the Company continued to minimize its administrative expenses.
- Research and development expenses also decreased significantly from $203k in Q1 2022 to $105k in Q1 2023 as the Company became more efficient at developing its products.
- Sales and marketing expenses also decreased from $106k in Q1 2022 to $43k in Q1 2023
2023 Q1 OPERATIONAL HIGHLIGHTS
- Strategic Initiative and Cost Realignment. On December 6, 2022, the Company announced that it implemented cost reduction measures, reallocated its workforce, and was exploring strategic options such as raising growth capital, merger, acquisition, or other transactions. The Company received advice from James Edward Capital Corporation, a boutique investment bank specializing in emerging growth companies, on its strategic options.
- Non-binding Letter of Intent: On December 19, 2022, the Company announced it had signed a non-binding letter of intent to merge with Getit to form a leading digital technology provider of delivery logistics and digital ordering solutions with immediate revenue growth opportunities.
- Binding Letter of Intent: The Company announced on January 4, 2023, that it had signed a binding Letter of Intent (LOI) to merge with Getit. The appointment of Patrick Power to Perk’s Board of Directors was also announced. Mr. Power is the Chairman and President of James Edward Capital Corporation, an Ottawa-based boutique investment bank focused on emerging growth companies.
- CFO Transition: On January 20, 2023, the Company announced that Vanessa Altamirano would step down as CFO, effective February 17, 2023, to pursue another professional opportunity and that the Company was restructuring for the planned merger with Getit. Andrew Bailes, a seasoned finance executive and Principal at Hertford Advisors, was announced as Interim CFO until a permanent CFO is
- Engaged Market Maker: On January 26, 2023, the Company announced that it had engaged Independent Trading Group (ITG) to provide market-making services in compliance with the Canadian Securities Exchange policies. The agreement was for an initial three-month term and is renewable for additional one-month periods. The Company will pay ITG CAD$5,000 per month for its services, and the agreement may be terminated with 30 days’ notice by either party.
- Notice of Allowance of US Patent: On February 22, 2023, the Company announced it had received a notice of allowance for a United States patent application directed at systems and methods for electronic payments with fraud prevention based on correlating transaction data and information from a user’s device.
HIGHLIGHTS SUBSEQUENT TO FEBRUARY 28, 2023
- Completion of Merger with Getit: On March 2, 2023, the Company announced it had completed its merger with Getit. The acquisition was completed through a share exchange, with the Company issuing an equivalent value of $4.655M in common shares of the company in exchange for all of the issued and outstanding shares of Getit. As part of the merger, Steve Cadigan and James Topham stepped down from the Board of Directors of the Company. Ben Lacroix and Ryan Hardy, the co-founders of Getit, were appointed to the Board of Directors and Ryan Hardy became the new CEO with Jonathan Hoyles transitioning to the role of Chief Legal Officer. Patrick Power assumed the position of Audit Committee Chair, succeeding James Topham. The Company further announced it planned to change its name and ticker symbol to reflect the combined entity. In connection with the merger, the four largest shareholders of Getit agreed not to sell, assign, or otherwise transfer the common shares of the Company received, with the lock-up period expiring on February 28, 2024.
- Private Placement: On April 25, 2023, the Company announced that it had closed a private placement of 11,609,909 units (“Units”), for proceeds of ~$190,000 and settled a debt of ~$85,900 with a creditor by issuing 5,238,414 Units. Each Unit included one Common Share and one Common Share purchase warrant. The net proceeds of the private placement are to be used for sales, marketing, and working capital. The Company also announced that Gary Zhang was transitioning from his role as Chief Technology Officer to an advisory role.
Outlook
The Company’s strategic priorities for 2023 include:
- A successful merger of the operations of Perk Hero Software Inc. and Getit
- Signing enterprise customers to use the Company’s technologies and services
- Continued improvement of our products and offerings.
- Grow the number of end-user customers and businesses using our technologies and services
- Grow our licensing and transactional revenue.
- Invest in sales, marketing, and communication strategies to drive growth.
The Company’s complete financial results are available in its Consolidated Financial Statements and Management’s Discussion and Analysis for the quarter ended February 28, 2023, each filed with Canadian securities regulators at www.sedar.com.
IFRS
The operational and financial information in this release is based on the consolidated figures in accordance with International Financial Reporting Standard (IFRS).
About Perk Labs
Perk Labs, the owner of Getit Technologies Inc. and Perk Hero Software Inc, specializes in technology, logistics, and connecting communities. Our digital payments and loyalty software empowers merchants to optimize their business and customer journey. Our marketplace and driver network connects and supports their business with additional sales and flexible last mile delivery options.
For more information, please contact:
Andrew Bailes
Interim Chief Financial Officer
833-338-0299
Neither the Canadian Securities Exchange nor its Regulation Services Provider (as that term is defined in the policies of the Canadian Securities Exchange) accepts responsibility for the adequacy or accuracy of this release.
Forward-Looking Statements
This press release contains forward-looking information or forward-looking statements (collectively “forward-looking information”) within the meaning of applicable securities laws. Forward-looking information is typically identified by words such as: “may”, “believe”, “thinks”, “expect”, “exploring”, “expand”, “could”, “anticipate”, “intend”, “estimate”, “plan”, “pursue”, “potentially”, “projected”, “should”, “will” and similar expressions, or are those, which, by their nature, refer to future events. These forward-looking statements, which involve risks and uncertainties, relate to, among other things, the discussion of Perk Labs’ business strategies and its expectations concerning future operations, that the Company’s efforts will be reflected in much more positive results in our next quarter, that by focusing on signing new enterprise clients and leveraging the synergies of both Perk and Getit, the Company is well-positioned to achieve much greater success in the upcoming quarter; that by prioritizing enterprise sales and strategic partnerships, we are confident our efforts will result in improved results and generate significant value for our stakeholders; that the Company will sign enterprise clients; the continued improvement of our platform; that we will grow the number of end-user customers and businesses using our platform; that we will grow our licensing and transactional revenue; and that we will invest in sales, marketing, and communication strategies to drive growth. Although Perk Labs considers these forward-looking statements to be reasonable based on information currently available to it, they may prove to be incorrect, and the forward-looking statements in this release are subject to numerous risks, uncertainties and other factors that may cause future results to differ materially from those expressed or implied in such forward-looking statements. For additional information with respect to these and other factors and assumptions underlying the forward-looking statements in this press release, see the section entitled “Risk Factors” in the most recent Annual Information Form and Prospectus of Perk Labs, which may be accessed through Perk Labs’ profile on SEDAR at www.sedar.com. Perk Labs cautions investors that any forward-looking information provided by Perk Labs is not a guarantee of future results or performance, and that actual results may differ materially from those in forward-looking statements. Undue reliance should not be placed on such forward-looking information, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur.