Docebo Reports Second Quarter 2021 Results

08/12/2021

Record revenue and Annual Recurring Revenue (“ARR”) growth driven by balanced strength from new logo, OEM partner, and upsell and cross-sell activities

TORONTO--(BUSINESS WIRE)-- Docebo Inc. (NASDAQ: DCBO; TSX:DCBO) (“Docebo” or the “Company”), a leading artificial intelligence (AI)-powered learning suite, today announced financial results for the three and six months ended June 30, 2021. All amounts are expressed in US dollars unless otherwise stated.

“Growth in the second quarter continued to accelerate as we added $10 million in net ARR from the first quarter resulting in our second consecutive quarter of ARR growth in excess of 60% and revenue growth in excess of 70%,” said Claudio Erba CEO and Founder of Docebo. “We are seeing balanced growth across the board from new logo sales, OEM partners, and upsell and cross sell activity. Although still early, we are also pleased with the customer reception of the launch of the Docebo Learning Suite as we expand our coverage across the entire enterprise learning lifecycle.”

Added Mr. Erba, “While the traditional LMS market has been focused on HR skills training and compliance, our customers use Docebo as a productivity enablement tool to address learning challenges enterprises have across operating departments and with their external customers and partners. This dynamic is not pandemic driven, rather it’s ROI driven, and that is why we believe the tailwinds we are seeing are both consistent and sustainable.”

Second Quarter 2021 Financial Highlights

  • Revenue of $25.6 million, an increase of 76% from the comparative period in the prior year
  • Subscription revenue of $23.6 million, representing 92% of total revenue, and an increase of 76% from the comparative period in the prior year
  • Revenue for the second quarter included a $1.1 million one-time cumulative catch up of revenue related to a customer contract that previously did not meet all requirements for revenue recognition; excluding this amount, total revenue for the quarter was $24.5 million, an increase of 69% from the comparative period in the prior year.
  • Gross profit of $20.5 million, or 80% of revenue, decline from the comparative period in the prior year
  • Net loss of $7.2 million, or $0.22 per share, compared to net loss of $3.5 million, or $0.12 per share for the comparative period in the prior year
  • Annual Recurring Revenue1, 2 as at June 30, 2021 of $93.4 million, an increase of $36.4 million from $57.0 million at the end of the second quarter of 2020, or an increase of 64%
  • Negative Adjusted EBITDA2 of $2.0 million, or 8% of revenue, compared to negative $0.9 million or 6% of revenue, for the comparative period in the prior year
  • Negative cash flow generated from operating activities of $0.6 million, compared to positive $0.2 million for the comparative period in the prior year
  • Negative free cash flow2 of $0.8 million compared to negative $0.035 million for the comparative period in the prior year
  • Cash and cash equivalents of $216.3 million as at June 30, 2021 compared to $219.7 million as at December 31, 2020

1 Please refer to “Key Performance Indicators” section of this press release.
2 Please refer to “Non-IFRS Measures and Reconciliation of Non-IFRS Measures” section of this press release.

Second Quarter 2021 Business Highlights

  • Docebo is now used by 2,485 customers, an increase from 1,923 customers at the end of June 30, 2020
  • Strong growth in average contract value, calculated as total Annual Recurring Revenue divided by the number of active customers, increasing from $29,616 to $37,569
  • Signed a new customer agreement with Lululemon, a world-leading retailer in athletic apparel, to provide a comprehensive learning solution to enhance and scale their learning objectives across the globe
  • Signed a new customer agreement with the global real-estate leader, RE/MAX, LLC, as their learning solution to grow their user adoption, address their user management needs, and create custom dashboards for their use cases
  • Signed a new customer agreement with Red Roof Inn, an award-winning leader in the lodging industry, as their learning suite to enhance the learning experience for their internal customers and to deliver a better overall experience for their guests
  • Signed a new customer agreement with JELD-WEN Inc., a leading global manufacturer of high-performance interior and exterior building products, to consolidate their learning systems in order to deliver learning, instructor led training and a combination of course and microlearning for ongoing professional development
  • Signed a new customer agreement with TotalEnergies, a leading French multinational integrated oil, gas and new energies company, to help measure and improve the effectiveness of their learning programs with Docebo Learning Impact
  • Signed a customer expansion agreement with SkinCeuticals to include Learning Analytics - Docebo’s most recent addition to its multi-product learning suite
  • Launched Docebo Community, a centralized place to connect with other customers, partners, and Docebo experts to share best practices, get answers, and find inspiration to get the most out of the Docebo experience
  • Added new OEM partnership agreements with a global IT services and consulting firm and Vartopia; a partnership agreement with Vinsys; and expanded the OEM agreement with MHR and partnership with Bluewater
  • Subsequent to quarter end added new OEM partnership agreements with Workspan, KOLABORI and OrchestrateHR

Second Quarter 2021 Results

Selected Financial Measures

 

Three months ended June 30,

 

Six months ended June 30,

 

2021

2020

Change

Change

 

2021

2020

Change

Change

$

$

$

%

 

$

$

$

%

Subscription Revenue

23,644

 

13,400

 

10,244

 

76.4

%

 

43,419

 

25,598

 

17,821

 

69.6

%

Professional Services

1,987

 

1,135

 

852

 

75.1

%

 

3,954

 

2,467

 

1,487

 

60.3

%

Total Revenue

25,631

 

14,535

 

11,096

 

76.3

%

 

47,373

 

28,065

 

19,308

 

68.8

%

 

 

 

 

 

 

 

 

 

 

Gross Profit Margin

20,479

 

11,687

 

8,792

 

75.2

%

 

38,357

 

22,384

 

15,973

 

71.4

%

Percentage of Total Revenue

79.9

%

80.4

%

 

 

 

81.0

%

79.8

%

 

 

Key Business Indicators

 

As at June 30,

 

2021

2020

Change

Change %

Annual Recurring Revenue (in millions of US dollars)

93.4

 

57.0

 

36.4

 

63.9

%

Average Contract Value (in thousands of US dollars)

37.6

 

29.6

 

8.0

 

27.0

%

Customers

2,485

 

1,923

 

562

 

29.2

%

Non-IFRS Metrics

 

Three months ended June 30,

 

Six months ended June 30,

 

2021

2020

Change

Change

 

2021

2020

Change

Change

$

$

$

%

 

$

$

$

%

Adjusted EBITDA

(2,011)

 

(886)

 

(1,125)

 

127.0

 

 

(4,484)

 

(3,275)

 

(1,209)

 

36.9

%

Free Cash Flow

(831)

 

(35)

 

(796)

 

2,274.3

%

 

(3,185)

 

(2,742)

 

(443)

 

16.2

%

Conference Call

Management will host a conference call on Thursday, August 12, 2021 at 8:00 am ET to discuss these second quarter results.

To access the conference call, please dial 416-764-8688 or 1-888-390-0546. The unaudited condensed consolidated interim financial statements for the three and six months ended June 30, 2021 and Management’s Discussion & Analysis for the same period have been filed on SEDAR at www.sedar.com and on EDGAR at www.sec.gov. Alternatively, these documents along with a presentation in connection with the conference call can be accessed online at https://investors.docebo.com.

An archived recording of the conference call will be available until August 19, 2021 and for 90 days on our website. To listen to the recording, call 416-764-8677 or 1-888-390-0541 and enter passcode 820926.

Forward-looking Information

This press release contains “forward-looking information” and “forward-looking statements” (collectively, “forward-looking information”) within the meaning of applicable securities laws. Forward-looking information may relate to our future financial outlook and anticipated events or results and may include information regarding our financial position, business strategy, the impact of COVID-19 on our business, growth strategies, addressable markets, budgets, operations, financial results, taxes, dividend policy, plans and objectives. Particularly, information regarding our expectations of future results, performance, achievements, prospects or opportunities or the markets in which we operate 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”, “is expected”, “an opportunity exists”, “budget”, “scheduled”, “estimates”, “outlook”, “forecasts”, “projection”, “prospects”, “strategy”, “intends”, “anticipates”, “believes”, or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “would”, “might” or, “will”, “occur” or “be achieved”, and similar words or the negative of these terms and similar terminology. 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.

This forward-looking information includes, but is not limited to, statements regarding the Company’s business; future financial position and business strategy; the learning management industry; our growth rates and growth strategies; addressable markets for our solutions; the achievement of advances in and expansion of our platform; expectations regarding our revenue and the revenue generation potential of our platform and other products; our business plans and strategies; and our competitive position in our industry. This forward-looking information is based on our opinions, estimates and assumptions in light of our experience and perception of historical trends, current conditions and expected future developments, as well as other factors that we currently believe are appropriate and reasonable in the circumstances. Despite a careful process to prepare and review the forward-looking information, there can be no assurance that the underlying opinions, estimates and assumptions will prove to be correct. Certain assumptions include: our ability to build our market share and enter new markets and industry verticals; our ability to retain key personnel; our ability to maintain and expand geographic scope; our ability to execute on our expansion plans; our ability to continue investing in infrastructure to support our growth; our ability to obtain and maintain existing financing on acceptable terms; our ability to execute on profitability initiatives; currency exchange and interest rates; the impact of competition; the effectiveness of mitigation strategies undertaken with respect to COVID-19, and the severity, duration and impacts of COVID-19 on the economy and our business, which is highly uncertain and cannot reasonably be predicted; our ability to respond to the changes and trends in our industry or the global economy; and the changes in laws, rules, regulations, and global standards are material factors made in preparing forward-looking information and management’s expectations.

Forward-looking information is necessarily based on a number of opinions, estimates and assumptions that, while considered by the Company to be appropriate and reasonable as of the date of this press release, are subject to known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking information, including but not limited to:

  • the Company’s ability to execute its growth strategies;
  • the impact of changing conditions in the global corporate e-learning market;
  • increasing competition in the global corporate e-learning market in which the Company operates;
  • fluctuations in currency exchange rates and volatility in financial markets;
  • the extent of the impact of COVID-19 and measures taken to contain the virus on our results of operations and overall financial performance;
  • changes in the attitudes, financial condition and demand of our target market;
  • developments and changes in applicable laws and regulations; and
  • such other factors discussed in greater detail under the “Risk Factors” section of our Annual Information Form dated March 10, 2021 (“AIF”), which is available under our profile on SEDAR at www.sedar.com.

If any of these risks or uncertainties materialize, or if the opinions, estimates or assumptions underlying the forward-looking information prove incorrect, actual results or future events might vary materially from those anticipated in the forward-looking information. The opinions, estimates or assumptions referred to above and described in greater detail in the “Summary of Factors Affecting our Performance” section of our MD&A for the three and six months ended June 30, 2021 and in the “Risk Factors” section of our AIF, should be considered carefully by prospective investors.

Although we have attempted to identify important risk factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other risk factors not presently known to us or that we presently believe are not material that could also cause actual results or future events to differ materially from those expressed in such forward-looking information. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. No forward-looking statement is a guarantee of future results. Accordingly, you should not place undue reliance on forward-looking information, which speaks only as of the date made. The forward-looking information contained in this press release represents our expectations as of the date specified herein, and are subject to change after such date. However, we disclaim any intention or 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.

All of the forward-looking information contained in this press release is expressly qualified by the foregoing cautionary statements.

Additional information relating to Docebo, including our Annual Information Form, can be found on SEDAR at www.sedar.com.

About Docebo

Docebo is redefining the way enterprises leverage technology to create and manage content, deliver training, and understand the business impact of their learning experiences. With Docebo’s multi-product learning suite, enterprises around the world are equipped to tackle any learning challenge and create a true learning culture within their organization.

Results of Operations

The following table outlines our unaudited condensed consolidated interim statements of loss and comprehensive loss for the following periods:

 

Three months ended June 30,

 

Six months ended June 30,

(In thousands of US dollars, except per share data)

2021

2020

 

2021

 

2020

 

$

$

 

$

 

$

Revenue

25,631

 

14,535

 

 

47,373

 

 

28,065

 

Cost of revenue

5,152

 

2,848

 

 

9,016

 

 

5,681

 

Gross profit

20,479

 

11,687

 

 

38,357

 

 

22,384

 

 

 

 

 

 

 

 

Operating expenses

 

 

 

 

 

 

General and administrative

6,924

 

3,392

 

 

14,361

 

 

7,685

 

Sales and marketing

10,447

 

5,878

 

 

19,566

 

 

11,763

 

Research and development

5,234

 

3,303

 

 

9,377

 

 

6,211

 

Share-based compensation

539

 

435

 

 

917

 

 

805

 

Foreign exchange loss (gain)

3,189

 

1,667

 

 

5,140

 

 

(2,047)

 

Depreciation and amortization

489

 

254

 

 

963

 

 

492

 

 

26,822

 

14,929

 

 

50,324

 

 

24,909

 

Operating loss

(6,343)

 

(3,242)

 

 

(11,967)

 

 

(2,525)

 

 

 

 

 

 

 

 

Finance expense (income)

76

 

42

 

 

74

 

 

(41)

 

Other income

(22)

 

(19)

 

 

(43)

 

 

(38)

 

Loss before income taxes

(6,397)

 

(3,265)

 

 

(11,998)

 

 

(2,446)

 

 

 

 

 

 

 

 

Income tax expense

793

 

233

 

 

836

 

 

309

 

 

 

 

 

 

 

 

Net loss for the period

(7,190)

 

(3,498)

 

 

(12,834)

 

 

(2,755)

 

 

 

 

 

 

 

 

Other comprehensive (income) loss

 

 

 

 

 

 

Item that may be reclassified subsequently to income:

 

 

 

 

 

 

Exchange (gain) loss on translation of foreign operations

(3,152)

 

(1,424)

 

 

(5,266)

 

 

1,918

 

Comprehensive loss

(4,038)

 

(2,074)

 

 

(7,568)

 

 

(4,673)

 

 

 

 

 

 

 

 

Loss per share - basic and diluted

(0.22)

 

(0.12)

 

 

(0.39)

 

 

(0.10)

 

Weighted average number of common shares outstanding - basic and diluted

32,811,687

 

28,546,696

 

 

32,796,468

 

 

28,538,588

 

Key Statement of Financial Position Information

(In thousands of US dollars, except percentages)

June 30,

2021

December 31,

2020

 

Change

Change

 

$

$

 

$

%

Cash and cash equivalents

216,311

 

219,658

 

 

(3,347)

 

(1.5)

%

Total assets

257,393

 

254,244

 

 

3,149

 

1.2

%

Total liabilities

63,554

 

53,938

 

 

9,616

 

17.8

%

Total long-term liabilities

7,770

 

8,211

 

 

(441)

 

(5.4)

%

Non-IFRS Measures and Reconciliation of Non-IFRS Measures

This press release makes reference to certain non-IFRS measures including key performance indicators used by management and typically used by our competitors in the software-as-a-service (“SaaS”) industry. These measures are not recognized measures under IFRS and do not have a standardized meaning prescribed by IFRS and are therefore not necessarily 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. These non-IFRS measures and SaaS metrics are used to provide investors with supplemental measures of our operating performance and liquidity and thus highlight trends in our business that may not otherwise be apparent when relying solely on IFRS measures. We also believe that securities analysts, investors and other interested parties frequently use non-IFRS measures, including SaaS industry metrics, in the evaluation of companies in the SaaS industry. Management also uses non-IFRS measures and SaaS industry metrics in order to facilitate operating performance comparisons from period to period, the preparation of annual operating budgets and forecasts and to determine components of executive compensation. The non-IFRS measures and SaaS industry metrics referred to in this press release include “Annual Recurring Revenue ”, “Adjusted EBITDA” and “Free Cash Flow”.

Key Performance Indicators

We recognize subscription revenues ratably over the term of the subscription period under the provisions of our agreements with customers. The terms of our agreements, combined with high customer retention rates, provides us with a significant degree of visibility into our near-term revenues. Management uses a number of metrics, including the ones identified below, to measure the Company’s performance and customer trends, which are used to prepare financial plans and shape future strategy. Our key performance indicators may be calculated in a manner different than similar key performance indicators used by other companies.

  • Annual Recurring Revenue: We define Annual Recurring Revenue as the annualized equivalent value of the subscription revenue of all existing contracts (including Original Equipment Manufacturer (“OEM”) contracts) as at the date being measured, excluding non-recurring implementation, support and maintenance fees. Our customers generally enter into one to three year contracts which are non-cancellable or cancellable with penalty. Accordingly, our calculation of Annual Recurring Revenue assumes that customers will renew the contractual commitments on a periodic basis as those commitments come up for renewal. Subscription agreements may be subject to price increases upon renewal reflecting both inflationary increases and the additional value provided by our solutions. In addition to the expected increase in subscription revenue from price increases over time, existing customers may subscribe for additional features, learners or services during the term. We believe that this measure provides a fair real-time measure of performance in a subscription-based environment. Annual Recurring Revenue provides us with visibility for consistent and predictable growth to our cash flows. Our strong total revenue growth coupled with increasing Annual Recurring Revenue indicates the continued strength in the expansion of our business and will continue to be our focus on a go-forward basis.

Annual Recurring Revenue was as follows as at June 30:

 

2021

2020

 

Change

Change %

Annual Recurring Revenue (in millions of US dollars)

93.4

57.0

 

36.4

63.9%

Adjusted EBITDA

Adjusted EBITDA is defined as net (loss) income excluding taxes (if applicable), net finance (income) expense, depreciation and amortization, loss on disposal of assets (if applicable), share-based compensation, foreign exchange gains and losses, and transaction related expenses.

The following table reconciles Adjusted EBITDA to net loss for the periods indicated:

 

 

 

 

 

 

 

Three months ended June 30,

 

Six months ended June 30,

(In thousands of US dollars)

2021

2020

 

2021

2020

 

$

$

 

$

$

Net loss

(7,190)

 

(3,498)

 

 

(12,834)

 

(2,755)

 

Finance income, net(1)

76

 

42

 

 

74

 

(41)

 

Depreciation and amortization(2)

489

 

254

 

 

963

 

492

 

Income tax expense

793

 

233

 

 

836

 

309

 

Share-based compensation(3)

539

 

435

 

 

917

 

805

 

Other income(4)

(22)

 

(19)

 

 

(43)

 

(38)

 

Foreign exchange loss (gain)(5)

3,189

 

1,667

 

 

5,140

 

(2,047)

 

Acquisition related compensation(6)

102

 

 

 

204

 

 

Transaction related expenses(7)

13

 

 

 

259

 

 

Adjusted EBITDA

(2,011)

 

(886)

 

 

(4,484)

 

(3,275)

 

Notes:

  1. Finance expense (income) for the three and six months ended June 30, 2021 and 2020 is primarily related to interest income earned on the net proceeds from the IPOs as the funds are held within short-term investments in highly liquid marketable securities which is offset by interest expenses incurred on the credit facility, lease obligations and contingent consideration.
  2. Depreciation and amortization expense is primarily related to depreciation expense on right-of-use assets (“ROU assets”), property and equipment and acquired intangible assets.
  3. These expenses represent non-cash expenditures recognized in connection with the issuance of share-based compensation to our employees and directors.
  4. Other income is primarily comprised of rental income from subleasing office space.
  5. These non-cash gains and losses relate to foreign exchange loss (gain).
  6. These costs represent acquisition related retention incentives associated with the achievement of both yearly performance milestones and continued employment for one employee of the acquiree.
  7. These expenses relate to professional, legal, consulting, accounting and other fees relating to the Nasdaq IPO in December 2020 that would otherwise have not been incurred and are not considered an expense indicative of continuing operations.

Free Cash Flow

Free Cash Flow is defined as cash (used in) from operating activities less additions to property and equipment and intangible assets. The following table reconciles our cash flow used in operating activities to Free Cash Flow:

 

Three months ended June 30,

 

Six months ended June 30,

(In thousands of US dollars)

2021

2020

 

2021

2020

 

$

$

 

$

$

Cash flow (used in) from operating activities

(631)

 

198

 

 

(2,814)

 

(2,346)

 

Additions to property and equipment

(200)

 

(233)

 

 

(371)

 

(396)

 

Free Cash Flow

(831)

 

(35)

 

 

(3,185)

 

(2,742)

 

 

For further information, please contact:
Dennis Fong, Investor Relations
(416) 283-9930
investors@docebo.com

Source: Docebo Inc.

Multimedia Files:

View all news