Bluedrop Performance Learning (“Bluedrop”) (TSX-V: BPLI) today reported its audited financial results for the year ended September 30, 2019.
Revenue for the year ended September 30, 2019 was $23.0 million, up from $20.0 million, an increase of 15%. Gross profit for the year was $10.8 million, up from $8.2 million, an increase of 32%. Pre-tax loss for the year was $2.2 million, versus pre-tax loss of $0.8 million in the prior year an increase of $1.4 million. After tax loss for the period was $4.4 million as compared to after tax loss of $0.7 million in the prior year. Management’s Discussion and Analysis for the year ended September 30, 2019, which are available on the Company’s web site at http://www.bluedrop.com or on SEDAR at http://www.sedar.com.
The Company reported increased revenues and gross profit in both business units. Revenues for the Training and Simulation group were up by $1.4 million and revenues for the Learning Networks group were up by $1.6 million. Expenses were up by $4.0 million in the year including increases in research and development spending of $2.5 million, sales and marketing spending of $0.6 million and general and administrative spending of $1.6 million associated with strategic planning and reorganizational activities in the period.
The Company continued to make significant investments in research and development in the year of $5.5 million versus $3.0 million in the previous year. The Training and Simulation group invested $2.4 million in the year to support the development of additional products based on the Rear Crew Mission Trainer (RCMT), the new stand-alone hoist for additional rotary wing aircraft, and a new land vehicle trainer. The Learning Networks group invested $3.1 million in research and development in the year up from $1.4 million in the previous year. Learning Networks continues to build its capabilities for a unique SaaS based platform for the health and safety compliance and workforce markets.
The Company reviewed its strategic options and determined that it would pursue a strategy to operate the two businesses separately for the foreseeable future. Based on this, an individual review of estimated future tax assets for each subsidiary was conducted and it was determined that income tax assets previously recorded for the Bluedrop Learning Networks subsidiary were subject to significant uncertainty of being able to be utilized under this strategy. The Company recorded a non-cash valuation allowance in income tax expense of $2.8 million in the fourth quarter associated with these tax assets. These tax assets are still available to the Company if it is determined they can be utilized in the future.
The Company purchased 0.2 million shares by way of the normal course issuer bid.
Revenue for the three months ended September 30, 2019 was $7.3 million, up from $3.8 million for the same period in the previous year, an increase of 91%. Gross profit for the period was $3.5 million, an increase of $1.8 million over the three-month period ended September 30, 2018. Pre-tax income was $0.7 million for the current quarter compared to nil for the same period in the previous year. After tax loss for the three months ended September 30, 2019 was $2.3 million compared to a loss of $0.1 million for the same period in the previous year.
Revenues increased in the fourth quarter by $3.5 million compared to the same period last year due to higher revenues in the both the Training and Simulation business unit and the Learning Networks business unit. Training and Simulation revenues increased by $3.2 million and Learning Networks revenues increased by $0.3 million versus the same period last year. Expenses for the quarter were up $1.1 million from that of the same quarter in the previous year. The largest increases were in research and development cost and general and administrative cost that combined increased by $0.6 million in the quarter versus the prior comparative period.
Commenting on the overall results and progress for the year, founder and CEO Emad Rizkalla said, “This was an important year for Bluedrop as we continued to make significant investments in our strategy to transform both of our investments into more product and proprietary technology based companies. We have increased revenues and gross profit in both of our companies this year while we simultaneously increased investments in research and development and building our market presence. We are starting to see the benefits of those investments with strong third and fourth quarter growth. We also invested in structurally separating the two companies into stand alone business operations. Finally, we added to the management teams to prepare for the growth in the coming years.
Fiscal year 2019 was a year of record investment which negatively impacted the in year financial results. However, the investment allowed us to advance our strategic goals. We have also made progress in building on our core technologies and pipeline of opportunities. Thanks to all employees, partners and clients for another year of hard work and commitment. Our transformation process is complex and it is not without risk, but I believe our strategy and persistence will be rewarded.”
Bluedrop Performance Learning Inc. (TSX-V: BPLI) is an innovator in both the development of workplace e-learning and simulation as well as the way large organizations deliver, track and manage training. Our two divisions serve the world’s leading aerospace and defence organizations as well as broad cross sections of organizations focused on managing system wide health and safety and developing the skills of external workforces. Bluedrop is creating the workforce of the future by improving the effectiveness, speed and cost of training delivery and management. For more information, visit www.bluedrop.com. You can follow us on Twitter: @Bluedrop_BPL.
This news release may contain “forward-looking information” as defined in applicable Canadian securities legislation. All statements, other than statements of historical fact included in this release, including, without limitation, statements regarding the impact of the operational restructuring and future plans and objectives of Bluedrop, constitute forward-looking information that involve various risks and uncertainties. Forward-looking information is based on a number of factors and assumptions which have been used to develop such information but which may prove to be incorrect, including, but not limited to, assumptions in connection with the operational efficiencies associated with the integration of technological and financial systems and general economic and market conditions. There can be no assurance that such information will prove to be accurate and actual results and future events could differ materially from those anticipated in such forward-looking information.
Important factors that could cause actual results to differ materially from Bluedrop’s expectations include general global economic conditions. For additional information with respect to risk factors applicable to Bluedrop, reference should be made to Bluedrop’s continuous disclosure materials filed from time to time with securities regulators, including, but not limited to, Bluedrop’s Management’s Discussion and Analysis of Results of Operations and Financial Condition for the year ended September 30, 2019. The forward-looking information contained in this release is made as of the date of this release and Bluedrop does not undertake to update publicly or revise the forward-looking information contained in this release, whether as a result of new information, future events or otherwise, except as required by applicable securities laws.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.