Mogo Reports Results for Q3 2024 and Expects Positive Adjusted Net Income for 2025
Raises 2024 Adjusted EBITDA1,2 guidance & introduces 2025 Adjusted EBITDA guidance of
Quarterly payments volume increased
AUM Increased
Adjusted EBITDA increased sequentially to
Mogo reports in Canadian dollars and in accordance with IFRS
“We’ve made ‘sustainable profitability’ our strategic priority, and our third quarter results reinforce that our work over the past year has helped the Company get a lot closer to this goal,” said David Feller, Mogo’s Founder and CEO. “At the same time, we continue to make the right investments in our wealth and payments platforms to support future growth in both markets. We have meaningfully enhanced the value proposition of our wealth products with features like the AI co-pilot, and our partnership with Postmedia gives us an efficient channel to build our brand and user base in wealth going forward. In our payments business, we’re seeing robust growth, with volume reaching record levels in the third quarter.”
Key Financial Highlights for Q3 2024
-
Subscription & Services revenue grew
12% over the prior year to$10.7 million -
Revenue increased in Q3 2024 to
$17.7 million 9% over the prior year, reflecting the third consecutive quarter of year-over-year growth in the Company's primary business lines of wealth, payments and lending. -
Gross profit was
$11.9 million $11.4 million 67.3% in Q3 2024 versus67.5% in Q2 2024. -
Adjusted EBITDA1 of
$2.1 million 12.1% margin), compared with$2.1 million 12.8% margin) in Q3 2023. -
Rule of 40 score3 of
24.4% in Q3 2024 versus4.3% in Q3 2023 and16.2% in Q2 2024. -
Cash flow from operating activities before investment in gross loans receivable1 was positive for the eighth consecutive quarter, reaching
$4.8 million 84% increase over Q3 2023-
Cash flow from operating activities was
$1.5 million $4.2 million
-
Cash flow from operating activities was
-
Adjusted net loss1 was
$0.5 million $0.5 million $1.5 million -
Net loss was
$8.1 million $9.5 million -
Cash, Marketable Securities & Investments totaled
$36.2 million $1.48 $41.5 million -
Cash and restricted cash was
$12.4 million $11.3 million -
Marketable securities of
$12.5 million -
Investment portfolio of
$11.3 million
-
Cash and restricted cash was
“We continue to focus on improving cash flow and profitability, and we made significant progress in the third quarter, highlighted by a
Business & Operations Highlights
-
Continued growth in payments volume - Mogo’s digital payment solutions business, Carta Worldwide, processed just under
$3.0 billion 23% compared to Q3 2023. -
Assets under management were
$409 million 22% year-over-year to$409 million 67% year over year. -
Mogo members increased to 2.17 million at quarter end, up
4% from Q3 2023. -
Enhancements to wealth offerings – During the quarter, Mogo continued its strong product improvement velocity with 15 app update releases, including:
- AI - Launched a new co-pilot tool that enables Mogo users to easily access the latest information and data on companies they are researching directly from the app.
- Educational content – Launched a new in-app educational content series designed to help investors improve their investing knowledge, skills and abilities.
- Intelligent Investing – Developed and began rolling out a new positioning strategy around “Intelligent Investing” to stand in direct opposition to the status quo.
- Partnership with Thomas Lee of Fundstrat - In July 2024, Mogo announced a new partnership to become the exclusive Canadian partner of top-ranked Wall Street investment strategist Tom Lee of Fundstrat. Mogo will provide members of the Company’s digital wealth platform, Mogo and Moka, with exclusive access to equity research and related products and services produced by a division of Fundstrat.
Financial Outlook
The outlook that follows supersedes all prior financial outlook statements made by Mogo, constitutes forward-looking information within the meaning of applicable securities laws, and is based on a number of assumptions and subject to a number of risks. Actual results could vary materially as a result of numerous factors, including certain risk factors, many of which are beyond Mogo’s control. Please see "Forward-looking Statements" below for more information.
-
For Fiscal 2024 Mogo is now expecting:
-
Subscription and services revenue growth of approximately
10% for the full year. -
Adjusted EBITDA2 guidance of
$6 $7 million $5 $6 million
-
Subscription and services revenue growth of approximately
-
Mogo also introduced Fiscal 2025 targets:
- High-single-digit subscription and services revenue growth, driving modest overall revenue growth.
-
Adjusted EBITDA of
$10 $12 million 69% year over year (from the mid-point of both ranges). - Mogo expects for the first time to generate positive adjusted net income for the year.
1 Non-IFRS measure. For more information regarding our use of these non-IFRS measures and, where applicable, a reconciliation to the most comparable IFRS measure, see “Non-IFRS Financial Measures” in the Company’s MD&A for the period ended September 30, 2024. |
2 Adjusted EBITDA and adjusted net loss are non-IFRS measures. Management has not reconciled these forward-looking non-IFRS measures to their most directly comparable IFRS measure, net loss before tax. This is because the Company cannot predict with reasonable certainty and without unreasonable efforts the ultimate outcome of certain IFRS components of such reconciliations due to market-related assumptions that are not within our control as well as certain legal or advisory costs, tax costs or other costs that may arise. For these reasons, management is unable to assess the probable significance of the unavailable information, which could materially impact the amount of the future directly comparable IFRS measures. |
3 Rule of 40 score is calculated by adding subscription and services revenue growth and adjusted EBITDA margin. |
Conference Call & Webcast
Mogo will host a conference call to discuss its Q3 2024 financial results at 12:00 p.m. ET on November 6, 2024. The call will be hosted by David Feller, Founder and CEO, and Greg Feller, President and CFO. To participate in the call, dial (289) 514-5100 or (800) 717-1738 (International) using conference ID: 58460. The webcast can be accessed at http://investors.mogo.ca. Listeners should access the webcast or call 10-15 minutes before the start time to ensure they are connected.
Non-IFRS Financial Measures
This press release makes reference to certain non-IFRS financial measures. These measures are not recognized measures under IFRS, do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. These measures are provided as additional information to complement the IFRS financial measures contained herein by providing further metrics to understand the Company’s results of operations from management’s perspective. Accordingly, they should not be considered in isolation nor as a substitute for analysis of our financial information reported under IFRS. We use non-IFRS financial measures, including Adjusted EBITDA, Adjusted net loss and Cash provided by (used in) operating activities before investment in gross loans receivable, to provide investors with supplemental measures of our operating performance and thus highlight trends in our core business that may not otherwise be apparent when relying solely on IFRS financial measures. Our management also uses non-IFRS financial measures in order to facilitate operating performance comparisons from period to period, prepare annual operating budgets and assess our ability to meet our capital expenditure and working capital requirements. For more information, please see “Non-IFRS Financial Measures” in our Management’s Discussion and Analysis for the period ended September 30, 2024, which is available at www.sedarplus.com and at www.sec.gov.
The following tables present a reconciliation of each non-IFRS financial measure to the most comparable IFRS financial measure.
Adjusted EBITDA
( |
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Three months ended |
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Nine months ended |
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September 30, |
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September 30, |
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September 30, |
|
September 30, |
||||||||
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||||
Net loss before tax |
|
$ |
(8,192 |
) |
|
$ |
(9,627 |
) |
|
$ |
(24,330 |
) |
|
$ |
(26,717 |
) |
Depreciation and amortization |
|
|
1,966 |
|
|
|
2,105 |
|
|
|
6,426 |
|
|
|
6,682 |
|
Stock-based compensation |
|
|
579 |
|
|
|
804 |
|
|
|
1,724 |
|
|
|
1,898 |
|
Credit facility interest expense |
|
|
1,726 |
|
|
|
1,521 |
|
|
|
5,114 |
|
|
|
4,469 |
|
Debenture and other financing expense |
|
|
791 |
|
|
|
768 |
|
|
|
2,550 |
|
|
|
2,377 |
|
Accretion related to debentures |
|
|
170 |
|
|
|
228 |
|
|
|
517 |
|
|
|
735 |
|
Share of loss in investment accounted for using the equity method |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
8,267 |
|
Revaluation loss |
|
|
5,284 |
|
|
|
5,480 |
|
|
|
12,497 |
|
|
|
3,972 |
|
Other non-operating (income) expense |
|
|
(177 |
) |
|
|
787 |
|
|
|
68 |
|
|
|
3,245 |
|
Adjusted EBITDA |
|
|
2,147 |
|
|
|
2,066 |
|
|
|
4,566 |
|
|
|
4,928 |
|
Adjusted Net Loss
( |
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|
|
|
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Three months ended |
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Nine months ended |
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September 30, |
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September 30, |
|
September 30, |
|
September 30, |
||||||||
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||||
Net loss before tax |
|
$ |
(8,192 |
) |
|
$ |
(9,627 |
) |
|
$ |
(24,330 |
) |
|
$ |
(26,717 |
) |
Stock-based compensation |
|
|
579 |
|
|
|
804 |
|
|
|
1,724 |
|
|
|
1,898 |
|
Depreciation and amortization |
|
|
1,966 |
|
|
|
2,105 |
|
|
|
6,426 |
|
|
|
6,682 |
|
Share of loss in investment accounted for using the equity method |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
8,267 |
|
Revaluation loss |
|
|
5,284 |
|
|
|
5,480 |
|
|
|
12,497 |
|
|
|
3,972 |
|
Other non-operating (income) expense |
|
|
(177 |
) |
|
|
787 |
|
|
|
68 |
|
|
|
3,245 |
|
Adjusted net loss |
|
|
(540 |
) |
|
|
(451 |
) |
|
|
(3,615 |
) |
|
|
(2,653 |
) |
Cash Provided by (used in) Operations before Investment in Gross Loans Receivable
( |
|
|
|
|
|
|||||||||||
|
|
Three months ended |
|
Nine months ended |
||||||||||||
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September 30, |
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September 30, |
|
September 30, |
|
September 30, |
||||||||
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||||
Net cash provided by (used in) operating activities |
|
$ |
1,530 |
|
|
$ |
(4,154 |
) |
|
$ |
(1,809 |
) |
|
$ |
(6,967 |
) |
Net issuance of loans receivable |
|
|
(3,300 |
) |
|
|
(6,773 |
) |
|
|
(12,230 |
) |
|
|
(11,780 |
) |
Cash provided by operations before investment in gross loans receivable |
|
|
4,830 |
|
|
|
2,619 |
|
|
|
10,421 |
|
|
|
4,813 |
|
Forward-Looking Statements
This news release contains “forward-looking statements” within the meaning of applicable securities legislation, including statements regarding the Company’s financial outlook for 2024 and for 2025. Forward-looking statements are typically identified by words such as "may", "will", "could", "would", "anticipate", "believe", "expect", "intend", "potential", "estimate", "budget", "scheduled", "plans", "planned", "forecasts", "goals" and similar expressions. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management at the time of preparation, are inherently subject to significant business, economic and competitive uncertainties and contingencies, and may prove to be incorrect. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual financial results, performance or achievements to be materially different from the estimated future results, performance or achievements expressed or implied by those forward-looking statements and the forward-looking statements are not guarantees of future performance. Mogo's growth, its ability to expand into new products and markets and its expectations for its future financial performance are subject to a number of conditions, many of which are outside of Mogo's control, including the impact of regulatory changes. For a description of the risks associated with Mogo's business please refer to the “Risk Factors” section of Mogo’s current annual information form, which is available at www.sedarplus.com and www.sec.gov. Except as required by law, Mogo disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, events or otherwise.
About Mogo
Mogo Inc. (NASDAQ:MOGO; TSX:MOGO) is a digital wealth and payments company headquartered in
View source version on businesswire.com: https://www.businesswire.com/news/home/20241106909749/en/
For further information:
Investor Relations
investors@mogo.ca
US Investor Relations Contact
Lytham Partners, LLC
Ben Shamsian
shamsian@lythampartners.com
(646) 829-9701
Source: Mogo Inc.
