All amounts in this news release are in United States dollars unless otherwise noted.
Intermap reported total revenue of $2.7 million for the third quarter of 2014, a 15% increase from the second quarter of the year. Third quarter revenue of $2.7 million is compared to $6.4 million in the same period of 2013. During the third quarter of last year, $5.4 million of mapping services revenue was recognized on a $15.0 million contract that was announced earlier in the year. No similar sized project was contracted for during the first nine months of the current year, making up the majority of the variance between the current year and the prior year periods. Net loss for the third quarter of 2014 was $2.8 million, or ($0.03) per share, compared to a net loss of $0.5 million, or ($0.01) per share, for the third quarter of 2013. Third quarter adjusted EBITDA, a non IFRS financial measure, was a loss of $2.1 million, a decrease from an adjusted EBITDA profit of $0.6 million for the same period in 2013. Adjusted EBITDA excludes share-based compensation, gain or loss on the disposal of equipment, and gain or loss on foreign currency translation.
"This third quarter was productive for us with the announcement of a $1.8 million mapping services contract and further progress with our 3DBI® (3D business intelligence) software applications," said Todd Oseth, President & CEO of Intermap. "In early October we reported v2.2 of our InsitePro® product. This latest release of InsitePro incorporates a new underwriting module that provides property insurance underwriters with a powerful means to evaluate individual locations for flood risk and other perils anywhere in the world."
During the third quarter Intermap announced that Swiss Re, a top ten global leader in the reinsurance market, had licensed its InsitePro product for use in Brazil.
"Swiss Re has available to them many different products to manage their underwriting business and we're pleased that they ultimately chose Intermap's InsitePro product to help solve their insurance underwriting challenges," said Mr. Oseth. "We view our contract with Swiss Re as a key endorsement for our InsitePro product."
InsitePro software helps Swiss Re to analyze and visualize location-specific risk to help bring superior flood and underwriting knowledge to the Brazilian market allowing them to evaluate locations one-by-one or thousands at a time via our innovative risk models and analytics.
"In addition to our progress on 3DBI software applications, we continue to progress towards the closing of a major international Orion Platform spatial data infrastructure contract," said Mr. Oseth.
Orion projects are primarily government sourced and inherently complicated. They typically carry long sales cycles due to (i) the dollar magnitude of the contract, (ii) the individual country's political landscape, (iii) the timing of budgets, (iv) the multi-agency and multi-level government approval process, (v) the complexity of the project, and (vi) the funding mechanisms required for the project (i.e. banking syndicates).
"We remain optimistic that we will be able to announce the signing of one of these contracts before the end of the year, but due to the factors mentioned above, the actual timing remains very difficult to predict," added Mr. Oseth.
Financial Review
Consolidated revenue for the third quarter of 2014 totaled $2.7 million and included (i) $2.0 million in mapping services, (ii) $0.1 million in professional services, (iii) $0.4 million in data licensing, and (iv) $0.2 million in 3DBI software licensing. For the same period in 2013, consolidated revenue totaled $6.4 million and included (i) $5.4 million in mapping services, (ii) $0.1 million in professional services, (iii) $0.6 million in data licensing, and (iv) $0.3 million in 3DBI software licensing. Contract backlog at the end of the quarter totaled $0.3 million.
For the third quarter of 2014, personnel expense was $2.8 million, compared to $3.0 million in the previous year. The decrease was primarily due to reduced commission expense consistent with decreased revenue recognized on a year-over-year basis.
For the third quarter of 2014, purchased services and materials expense was $1.4 million, compared to $1.9 million during the same period last year. The decrease in this category of expense is primarily due to project specific costs associated with airborne data collection efforts in the previous year with no similar work under contract in the reporting period. Purchased services and materials includes (i) aircraft related costs, including jet fuel, (ii) professional and consulting costs, (iii) third-party support services related to airborne data collection efforts, processing and editing of the Company's data collection efforts, and (iv) software expenses (including maintenance and support).
The cash position of the Company at September 30, 2014 (cash and cash equivalents) was $1.0 million, compared to $2.4 million at December 31, 2013. Amounts receivable and unbilled revenue at September 30, 2014 was $3.4 million, compared to $6.6 million at December 31, 2013. Working capital was negative $5.1 million at September 30, 2014, compared to positive $3.9 million at December 31, 2013 (see "Intermap Reader Advisory" below).
Detailed financial results and management's discussion and analysis can be found on SEDAR at: www.sedar.com.
Second Quarter Business Highlights (Previously Announced)
- Intermap announced the award of a $1.8 million contract for an airborne radar mapping services solution. The Company's proprietary Interferometric Synthetic Aperture Radar (IFSAR) technology will be used to collect orthorectified radar imagery and high resolution elevation data to enhance the customer's existing geospatial map database. This new dataset will be used for improved disaster planning, resource management, security interests, and infrastructure planning.
- Intermap announced the launch of AdPro v3.2 which provides media planners, buyers and owners with an easy way to turn big data into smarter advertising decisions. This latest version of AdPro gives users the ability to analyze market-level campaigns using Traffic Audit Bureau (TAB) ratings for reach, frequency and impressions to quickly pinpoint the perfect audience. AdPro v3.2 allows users to evaluate and select the best locations for their out-of-home advertising campaigns by offering integrated access to standardized TAB ratings. The TAB out-of-home ratings are standardized, quantitative and reliable – providing exhaustive demographic information across the entire United States.
- Intermap announced the launch of GeoPro™ Bundle, a new software offering that includes a customer-selected set of Intermap's unmatched NEXTMap ® elevation data with a subscription to the Company's GeoPro SaaS application.
- Intermap announced further details about a previously announced agreement ( June 10, 2014 ) to license the Company's InsitePro software to a top ten global reinsurer for use in Latin American. Swiss Re contracted with the Company to license its InsitePro risk software product to help them visualize and analyze location-specific risk. Under the terms of the agreement, Swiss Re is using the product to help bring its superior flood and underwriting knowledge to the Brazilian market in the form of a flood risk assessment tool. This tool provides underwriters with a powerful means to evaluate locations one-by-one or thousands at a time via innovative risk models and analytics.
- The Company announced the release of InsitePro v2.2. This latest version includes a new Underwriting Module that provides property insurance underwriters with a means to evaluate individual locations for flood risk and other perils anywhere in the world.
