Capelle aan den Ijssel, The Netherlands 29 April 2021 - GeoJunxion shows modest Q1 YoY topline growth, improves its bottom line, and significantly increases order intake, which will convert into revenue in the remainder of 2021.
Covid-19 and the related measures taken over the past 12 months, have proven to be a significant challenge for the global economy. The GeoJunxion team and our underlying business continues to show strong resilience: Revenue during the past quarter has increased by a modest 4% compared to the same period in 2020. The bright spot is the order intake, which has increased by 38% thus far, versus last year. In addition, we are very encouraged by the market response to our new products and the strength of our pipeline of opportunities.
OPERATIONAL HIGHLIGHTS AND STRATEGY UPDATE
Market Developments
Amid the COVID restrictions, companies are still very prudent and at times very reluctant to invest. This is especially valid for businesses in the travel, leisure, and events segment. In this environment and without any precise timelines on when restriction will end, several of our prospects and customer opportunities are waiting for clarity to restart activities and invest in business improvements.
Business Development
In the first quarter of this year, we have focused on expanding our interactions with the industry through our new High Alert Zones family of products. We continue to receive positive feedback, invitations for product demos and requests for test and evaluation samples. Strongest traction is on our Eco Alert Zones, where we have a unique value proposition with fully attributed, global, and authoritative coverage of Low Emission Zones, Congestion areas and Limited Traffic zones. Several prospects have confirmed the quality, freshness, and completeness of our data. This has led to a strong pipeline of opportunities, some of which we expect to close in months to come.
We have also engaged with several prospects for our Outdoor Venue Plan services. Many of these use cases are related to travel, leisure, and tourism. However, these businesses were hit severely by the current COVID measures hence they hesitate to investe in better visitor experience.
Since the launch of our new brand and website in October 2020, we have seen a growing number of relevant visitors to our website. We are also receiving more and more interesting leads for our key services and products: Location Intelligence Services and High Alert Zones. Our monthly webinars are enjoying growing traction and attention. Recordings of all webinars are available on our website, in the resource section.
Product Development
For the first few months of the year, we have made significant investments in the improving and expanding our key future products: Safety, Eco, and Health Alert Zones. In addition, we have invested in a mobile app called GeoAlertsLive, planned to launch at the end of April. The launch of this app is a significant development in three ways: Firstly, it creates a new and direct channel into the market. Secondly, it will help us demonstrate the great value of our High Alert Zones suite of products. And thirdly it will enable us to get direct customer feedback, to further tailor and improve our products. The app will be available soon on the Google PlayStore and Apple Store and will be offered with a freemium business model.
Technology Development
With the development of our own app, the team is also developing the necessary underlying APIs to communicate between the mobile users and GeoJunxion’s location enabled cloud-based data servers. This suite of APIs, built for high volumes of requests, will demonstrate our technological capabilities to other mobile application builders, smart cities projects, as well as enable our own High Alert Zones content platform.
At the end of last year, GeoJunxion was invited by Esri to be one of their few partners to participate in the Service on Demand (SoD) pilot program. Service on Demand is a new way to sell our data to the ArcGIS users worldwide. Through the Esri ArcGIS platform, GeoJunxion will be enabled to sell its content directly to the complete user base. The SoD technology allows GeoJunxion to keep the content safe, on its own infrastructure, while giving access to it on demand. An interested ArcGIS MarketPlace user can then purchase exactly the data that is relevant to its application by indicating the region or location of interest and pay accordingly via the platform. In the first quarter of this year, we installed and tested the technology for our ZIP+4 content. In the coming months, we will perform further tests and deploy additional content. A successful completion of this pilot will enable GeoJunxion to offer a complete new and more flexible business model, such as micro services.
In response to the increasing demand for hyper local content, we have created a unique suite of algorithms and methods, that enables us to automate the generation of boundaries or polygons. Based on this technology, we are creating a new Built-Up Areas product with worldwide coverage. A build up area, is an area that has a dense concentration of residential or industrial buildings and is typically a subset of a city area. Knowing the exact location of the built-up area is a very critical piece of information for any location solution. It could enable, for example, more advanced routing or display functions.
Partner & Alliances
Our partnership with Esri continues to develop well. Esri is the global market leading solution provider for Geographic Information System (GIS), with over 350,000 customers and more than 45% market share (1). On 15 March, we participated, as guest speaker, to Esri’s worldwide partner conference (EPC). Due to the current pandemic situation, this conference took place online with several hundreds of ESRI global partners. The topic of our session was “Delivering Content with Esri Technology” and 120 participants attended. Esri is an important alliance partner for GeoJunxion, both in terms of its market leading technology platform and market reach around the world.
Our Alliance with NavInfo is making great progress, several Smart City projects were identified as we continue to develop our value proposition to the market. NavInfo’s deep know how in Machine Learning, Computer Vision, and the automotive industry, paired with our focus on location enabled content to foster road safety and sustainability is a unique combination. This collaboration is expected to lead to interesting Smart City projects in the next few months and years to come.
On 4 March, we announced the successful agreement of a collaboration with the Innovative Province of North Brabant in the Netherlands. The aim of the partnership is to consolidate and improve asset management as well road safety.
The Province of North Brabant has always aimed to be among the leading European regions in terms of knowledge and innovation, to provide safety and sustainability to all inhabitants. Building on decades of mapping experience, GeoJunxion focuses on high value, dynamic content that enrich environmentally conscious applications and safety in everyday life. This new agreement paves the way for GeoJunxion to offer to the province its Data as a Service (DaaS).
Order Intake / Bookings developments
Towards the end of Q1 and in April we have seen strong order intake for Location Intelligence Services. We see a growing interest for bespoke and hyperlocal data creation and aggregation. An ever-increasing consumer expectation in location enabled applications drives the need for specific and relevant local information, such as the non-official names of a neighborhoods or districts. In this domain we announced in March the closing of a substantial contract with a global tech company.
Our 2021 order intake to date, has grown with 38% compared to the same period in 2020. Orders for location Intelligence Services booked will convert to revenue primarily in Q2 and Q3.
We like to thank our employees, customers, shareholders, and contractors for their ongoing contribution to the turnaround of the company.
FINANCIAL SUMMARY Q1 2021 RESULTS VERSUS Q1 2020
- Revenue for Q1 2021 is growing modestly by 4% compared to Q1 2020.
- Increased Operational expenses reflect investment in products, sales and marketing spend.
- Operating result improved slightly by 1% to a loss of €439 K, compared to a loss of €444 K in Q1 2020.
- Net result after tax improved by 40% to a net loss of €305 K versus €507 K in Q1 2020.
- Net cash-flow from operating and investing activities equals an outflow of €41 K Euro, a significant improvement versus a cash outflow of €311 K versus Q1 2020.
- Consolidated 31 March 2021 cash-position equals €1.072 K.
KEY FIGURES
OUTLOOK FOR THE FULL CALENDER YEAR 2021
Covid-19 and the related measures to contain its spread, have continued to hamper our business development during the past quarter. This was particularly the case for our products directed towards the travel, leisure, and events industry, which were severely impacted by lockdowns. Despite this, we are experiencing strong market interest in our new product portfolio, resulting in a strong and growing pipeline of opportunities. Some of these are expected to close in the weeks and months to come. Booked orders to date have increased by 38%, compared to the same period as last year, primarily driven by the Location Intelligence Services segment. Based on the orders in hand, and the strength of the pipeline of opportunities, we confirm our expectation to generate a revenue growth for the calendar year 2021, in the range of 40 to 50% compared to calendar year 2020.
FINANCIAL POSITION
GeoJunxion continues to make significant progress in turning its business around from a digital map supplier focused on one-off large deals, to a premium location content and location intelligent service provider with a subscription based, recurring “data as a service” revenue model. During the past quarter GeoJunxion has continued to invest in product development and in sales and marketing. The private placement completed in December 2020 is expected to provide the funding needed to enable GeoJunxion to grow its new business model towards a cash generating and profitable organization. The cash currently available on hand is estimated to be sufficient to cover our operational requirements for at least the next 12 months.
REPLACEMENT OF EXTERNAL AUDITOR
We continue to explore all possible options to replace our previous OOB-licensed auditor, Grant Thornton. Partially to allow time in resolving this issue and move outside of the auditing peak season, GeoJunxion has extended the current accounting year to 30 June 2021. During the past months we have engaged with all available OOB licensed Auditors in the Netherlands, requesting a quote for the Audit of our accounts per 30 June 2021. Mazars is not available to us as they are still in the cool down period as our 2017 auditor. To date we have received 3 rejections for the same reasons as last year and are still waiting for the reply from one of the firms. We do have ongoing talks with one auditing firm. There is however no guarantee that these efforts will conclude in an agreement.
RISK MANAGEMENT
Risk management is an integral managerial task. Our risk management and control procedures take into consideration the size of the company and the character of the business to identify the most significant risks which the company is exposed to. The risks identified are discussed on a periodical basis and mitigated where possible. Such a system cannot provide absolute certainty that objectives will be realized. Neither can it guarantee prevention of potential cases of material mistakes, damage, fraud, or breaches of statutory laws.
The 2019 annual report describes the principal strategic, operational, and financial risks. The risks and uncertainties described in the annual report are still relevant and are deemed incorporated and repeated by reference in this report. There were no cases of material damage, fraud or breaches of law detected in 2020 and Q1 2021. However, the Covid-19 outbreak and the associated and prolonged pandemic control measures have had a disruptive effect on the economy and an adverse effect on our business, most noticeably in our data sales business and our last mile mapping service directed to travel, leisure and events business and the associated revenues. Although we have taken mitigating actions and the expectation that lockdown measures will be gradually lifted with the progress in the vaccination campaigns, there is no guarantee that the pandemic and its associated control measures will not have a further negative impact in 2021 on our business, financial position, and results.
BOARD OF MANAGEMENT STATEMENT
The Board of Management hereby declares that, to the best of its knowledge, the summarized Q1 2021 consolidated financial statements, drawn up in accordance with IAS 34 “Interim financial reporting”, represents a faithful rendering of the assets, liabilities, financial position, profit and cash flow of GeoJunxion NV and its subsidiaries as stated in the consolidated financial report, and that the Board report as included in this Q1 2021 Interim Financial report represents a faithful rendering of the information required in relation to item 5:25d subs 8 and 9 of the Dutch Financial Supervision Act.
GROUP STRUCTURE SIMPLIFICATION
The voluntary liquidation of AND Data India Pvt, LTD, continues to progress well: Early January 2021 we completed the repatriation of approximately 50% of the funds available in the company. Expectation is that the remaining funds will be repatriated in Q2 2021. Soon after that, we target to complete the liquidation of the Indian legal entity.
Capelle aan den IJssel, 29 April 2021,
Thierry Jaccoud – Chief Executive Officer
Ivo Vleeschouwers – Chief Finance Officer
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