Year-to-date revenue grows 64%, driven by strong performance in all lines of business
Unearned and unbilled revenue in quarter up $980k, largest quarterly gain to date, driven by new subscriptions
Affirming full year guidance for 15% - 20% revenue growth
Completed private placement with potential gross proceeds of CAD $3.37 million
DENVER – Intermap Technologies (TSX: IMP; OTCQX: ITMSF) (“Intermap” or the “Company”), a global leader in 3D geospatial data and intelligence solutions, announced that revenue for the nine months ended September 30, 2022 increased 64% compared with the previous year. For the nine months ended September 30, 2022, the Company reported revenue of $5.6 million, compared with $3.4 million for the same period in 2021.
During the third quarter, government sales improved to $1.9 million compared with $0.6 million for the prior year. Growth came from domestic and foreign sources. Following a national election in Colombia, including a change in government during the quarter, Intermap experienced booking-to-billing delays as a result of the transition. Revenue for the three months ended September 30, 2022 declined to $1.2 million compared with $1.4 million last year as a result of delayed book-to-bill timing.
Commercial sales recognized a 50% increase in subscription-based revenue compared with the third quarter of 2021. Intermap’s recurring subscription sales now represent 46% of total revenue. Unearned Revenue, a balance sheet item, increased by $0.98 million on September 30, 2022, driven by new pre-paid software subscriptions, representing the highest growth quarter in high-margin, cash-generating accounts.
The number of unique software subscribers increased 14% as of September 30, 2022, compared with September 30, 2021, and the average subscription size increased 19% during the period. These contracts enable customers to outsource to Intermap the collection, production, quality control, refresh and delivery of 3D geospatial intelligence, avoiding the cost, uncertainty and infrastructure associated with large in-house GIS workflows.
More than 25% of value-added data revenue for the nine months ending September 30, 2022 was derived from recurring customer licenses. Value-added data increased to $2.1 million for the nine months ended September 30, 2022, compared with $1.3 million for 2021, a 62% improvement. The increase was due to recurring updates for refresh data, with similar annual updates expected to continue.
The increase in high-margin subscription and cloud-based revenue also drove a 37% increase in gross margin from 35% for the nine months ended September 30, 2021 to 48% for the same period this year. As Intermap continues to grow recurring revenue, fixed overhead associated with data infrastructure and public company reporting obligations are better absorbed, and it expects further benefits from operating leverage, and the continued expansion of gross and operating margins.
Cash used in Operating Activities improved to $1.2 million compared with $1.7 million last year. The drawdown in operating cash flow is largely due to radar and software system upgrades that are not capitalized as Intermap designed and prepared to implement modifications for an upcoming country-wide collection mission. Intermap continues to invest significant capital to maintain and improve its one-of-a-kind airborne remote sensing platform and radar systems, including salaries and equipment. IFRS accounting does not permit the Company to capitalize this investment, leading to a large difference between cost basis and book value. However, the Company believes its material ongoing investment in proprietary property and equipment maintains its critical competitive advantage over other providers in its markets, which is demonstrated through ongoing and expected contract wins. The decline in Total Assets came from depreciation related to the legacy radar system.
The Company also announced completion of a nonbrokered private placement offering for potential gross proceeds of C$3.37 million (the "Offering"). The Offering consisted of 1 million Class A common shares (“Shares”) at C$0.40 as well as 2.97 million units ("Units") at a price of C$0.40 per Unit. Each Unit will consist of one Share and one transferable common share purchase warrant (a "Warrant"). Each Warrant will entitle the holder to purchase one additional Share at a price of C$0.60 per Share. The Warrants are subject to an acceleration clause whereby in the event that the closing price of the Shares on the Toronto Stock Exchange is equal to or greater than C$1.00 for 20 consecutive trading days, the Company shall have the right, by providing notice to the holder of the Warrants within five trading days thereof, to accelerate the expiry date of the Warrants to the 21st trading day after the issuance of the notice to the holder of the Warrants providing for the new expiry date.
Intermap’s consolidated financial statements for the quarter ended September 30, 2022, along with management’s discussion and analysis for the corresponding period and related management certifications for third quarter financial results, are available on SEDAR at www.sedar.com.
Selected Annual Information
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Certain information provided in this news release, including reference to full-year guidance, constitutes forward-looking statements. The words "anticipate", "expect", "project", "estimate", "forecast", “will be”, “will consider”, “intends”, “guidance” and similar expressions are intended to identify such forward-looking statements. Although Intermap believes that these statements are based on information and assumptions which are current, reasonable and complete, these statements are necessarily subject to a variety of known and unknown risks and uncertainties. Intermap’s forward-looking statements are subject to risks and uncertainties pertaining to, among other things, cash available to fund operations, availability of capital, revenue fluctuations, nature of government contracts, economic conditions, loss of key customers, retention and availability of executive talent, competing technologies, common share price volatility, loss of proprietary information, software functionality, internet and system infrastructure functionality, information technology security, breakdown of strategic alliances, and international and political considerations, as well as those risks and uncertainties discussed Intermap’s Annual Information Form and other securities filings. While the Company makes these forward-looking statements in good faith, should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary significantly from those expected. Accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits that the Company will derive therefrom. All subsequent forward-looking statements, whether written or oral, attributable to Intermap or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. The forward-looking statements contained in this news release are made as at the date of this news release and the Company does not undertake any obligation to update publicly or to revise any of the forward-looking statements made herein, whether as a result of new information, future events or otherwise, except as may be required by applicable securities law.
About Intermap Technologies
Founded in 1997 and headquartered in Denver, Colorado, Intermap (TSX: IMP; OTCQX: ITMSF) is a global leader in geospatial intelligence solutions, focusing on the creation and analysis of 3D terrain data to produce high-resolution thematic models. Through scientific analysis of geospatial information and patented sensors and processing technology, the Company provisions diverse, complementary, multi-source datasets to enable customers to seamlessly integrate geospatial intelligence into their workflows. Intermap’s 3D elevation data and software analytic capabilities enable global geospatial analysis through artificial intelligence and machine learning, providing customers with critical information to understand their terrain environment. By leveraging its proprietary archive of the world’s largest collection of multi-sensor global elevation data, the Company’s collection and processing capabilities provide multi-source 3D datasets and analytics at mission speed, enabling governments and companies to build and integrate geospatial foundation data with actionable insights. Applications for Intermap’s products and solutions include defense, aviation and UAV flight planning, flood and wildfire insurance, disaster mitigation, base mapping, environmental and renewable energy planning, telecommunications, engineering, critical infrastructure monitoring, hydrology, land management, oil and gas and transportation.