Copperleaf Technologies Inc. (“Copperleaf” or the “Company”), a provider of enterprise decision analytics software solutions, announced financial results for the three months ended March 31, 2024. All amounts are expressed in Canadian dollars unless otherwise stated.
Paul Sakrzewski, CEO of Copperleaf commented, “During the first quarter, Copperleaf delivered material growth across all of our key financial metrics. This was highlighted by a 32% YoY increase in Annual Recurring Revenue, and a record backlog, demonstrating a strengthening market understanding of the outstanding value we bring to our clients. Overall, this increasing market understanding, the sustained fundamental tailwinds and improved execution from our focused go-to-market strategies are driving expansion within our core sectors, and momentum in new sectors.”
“Throughout the quarter, we added new clients in core sectors and built upon established beachheads in new sectors in line with our strategy. In addition to new client acquisitions, our Client Success Management team showed material success in getting existing clients excited about some material expansions, resulting in growth in our Net Revenue Retention to 113%,” continued Mr. Sakrzewski.
“Our strong performance in Q1 underscores the effectiveness of our refreshed go-to-market model and increasing partner engagement. We anticipate continued robust growth in ARR and pipeline development throughout 2024 with our traditional Q4 weighting. These factors, combined with accelerating revenue growth and disciplined approach to managing costs, position us for significant progress back towards profitability,” Mr. Sakrzewski concluded.
First Quarter 2024 Financial Highlights
(All capitalized terms used but not defined in this press release have the meanings ascribed to them in Management’s Discussion and Analysis for the three months ended March 31, 2024; Comparison period is to the three months ended March 31, 2023, unless otherwise stated)
- Record revenue of $25.8 million, an increase of 29% compared to Q1 2023, driven by an increase in new clients and the expansion of existing clients.
- Subscription revenue of $14.9 million, an increase of $3.6 million, or 32%, over Q1 2023, followed by a 27% increase in professional services revenue to $8.8 million, and a 20% increase in perpetual revenue year over year to $2.1 million.
- Annual Recurring Revenue1 as at March 31, 2024 of $64.6 million, a 32% increase from $49.1 million as at March 31, 2023.
- As of March 31, 2024, the Company’s Net Revenue Retention Rate1 was 113% compared to 111% as of March 31, 2023.
- Gross profit of $18.9 million representing a gross margin of 73%, a 38% increase from $13.7 million and a gross margin of 68% in Q1 2023. Gross margin increased primarily due to an increase in subscription, professional services and perpetual license revenue partially offset by an increase in personnel costs, subcontractor costs, and product and support expenses related to our growing client base.
- Adjusted EBITDA1 loss of $3.3 million, compared to Adjusted EBITDA1 loss of $10.0 million in Q1 2023.
- Net loss of $2.6 million, or a loss of $0.04 per basic and diluted share, compared to a net loss of $11.8 million, or a loss of $0.17 per basic and diluted share, in Q1 2023. The decrease in net loss was primarily due to an increase in revenue and a decrease in headcount when compared to Q1 2023.
- As of March 31, 2024, Copperleaf’s Revenue Backlog1 grew 32% to $145.5 million compared to $110.5 million, as of March 31, 2023.
- Strong balance sheet with cash and cash equivalents of $33.5 million, short-term investments of $77.5 million, and long-term investments of $18.5 million as at March 31, 2024.
Key Developments
- During the first quarter, the Company continued to expand in its core sectors and made progress on its new-sector strategy, building upon the established beachheads in Transportation, Upstream Oil & Gas, and the globalization of Copperleaf’s Water sector.
- In addition to new client acquisitions, Copperleaf’s Client Success Management team continued to gather momentum with material expansions with existing clients.
- The Partner and Alliance Ecosystem continued to gain traction as the Company’s partners played significant roles in wins across all regions.
- Q1 saw the continued roll out of our successful and popular “Copperleaf AIPM Forum” series in Italy, the Netherlands, and Japan with strong participation from both existing clients and prospects.
- During Q1, Copperleaf released version 24.1 of its product suite with numerous new features, including: Self-Serve Analysis functionality, which leverages cloud-native services to enable flexible enterprise reporting; generative AI Online Help functionality; and enhancements to the Company’s geospatial (GIS) offering allowing map-based visualization of portfolio hierarchies.
- In Q1, Copperleaf was granted a Canadian patent for filtering, displaying and comparing different investment scenarios. This patent highlights Copperleaf’s on-going dedication to R&D – pioneering solutions that facilitate better investment decision making.
1 Please refer to “Non-IFRS Measures” section of this press release
Q1 2024 Financial Results Conference Call Details
Paul Sakrzewski, Chief Executive Officer and Chris Allen, Chief Financial Officer and Chief Operating Officer will host the conference call, followed by a question-and-answer session today, May 9, 2024, at 5:00 PM ET.
Date: May 9, 2024
Time: 5:00pm ET
Dial-In Number: 416-764-8659 or 1-888-664-6392
Webcast: https://app.webinar.net/3MdDxYdAw1N
Replay: 416-764-8677 or 1-888-390-0541 (Available until May 16, 2024)
Replay Entry Code: 072916#
RapidConnect URL: https://emportal.ink/4b5Ldfi
