NEW YORK, Aug. 16, 2021 (GLOBE NEWSWIRE) — Logiq, Inc. (NEO: LGIQ) (OTCQX: LGIQ), a global provider of award-winning e-commerce and fintech solutions, reported results for the second quarter ended June 30, 2021. The company will hold a conference call at 4:30 p.m. Eastern time today to discuss the results (see dial-in information below).
Q2 2021 Financial Highlights
- Revenue for the second quarter increased 3% sequentially to $8.3 million.
- Consolidated gross margin in the second quarter increased to 29.5%, up 1.9 percentage points sequentially and up 16.4 percentage points from the year-ago quarter.
- Gross margin for DataLogiq, the company’s data-driven, end-to-end e-commerce marketing solution, improved from the low of 15.5% in Q2 2020 to 28.4% in Q2 2021, due to improved internal efficiencies and scale of operations.
- Gross margin for AppLogiq, the company’s mobile commerce platform-as-a-service (PaaS), improved from the low of 11.6% in Q2 2020 to 31.7% in Q2 2021, as it continued to transition from lower to higher margin deployments.
- Cash and cash equivalents and restricted cash totaled $5.8 million as of June 30, 2021.
Q2 2021 Operational Highlights
- Launched a new audio digital marketing channel on the Logiq Digital Marketing™ (LDM) platform. Now in addition to web, mobile and Connected TV, marketing agencies and brands can now use LDM to add audio-based advertising to their overall multi-channel e-commerce marketing campaigns, such as for digital radio and podcasts.
- AppLogiq partnered with Mentalku, the exclusive government-licensed provider of psychological testing required for driver license applications and renewals in Indonesia, to offer a mobile payment option for Mentalku’s testing services.
- Released CreateApp 4.0, the company’s mCommerce platform-as-a-service, that included critical features requested by the company’s merchants to simplify stocking and inventory management processes.
- The total gross proceeds to the company from its initial public offering in Canada and listing on the NEO Exchange, and a partial exercise of an over-allotment option, totaled approximately US$5.3 million.
“In Q2, we achieved another quarter of improvement as we continued to transform our business and focus on higher margin, higher quality revenue streams,” commented Logiq president, Brent Suen. “Revenue climbed 3% sequentially to $8.3 million, following a better-than-expected, record 23% jump in the previous quarter.
“We also saw gross margin increase sequentially by 1.9 percentage points to a record 29.5% in the second quarter, up from 13.1% versus the same year-ago quarter. This resulted in gross profit more than doubling to $2.4 million versus the year ago quarter, but on $1 million less in revenue. We believe these results affirm our decision to transition away from low margin business activity and focus on higher quality, higher margin revenues streams.
“During the quarter, we also made great strides in expanding and strengthening our business relationship and operational platform across several fronts in preparation for future growth. On the AppLogiq front, we released CreateApp 4.0 that included critical features requested by our merchants to simplify stocking and inventory management processes.
“Additionally, we reported an exciting update with our mobile payment technology, PayLogiq. We announced a new partnership with Mentalku, the exclusive government-licensed provider of psychological testing required for all driver license applications and renewals in Indonesia — a country with more than 300 million licensed drivers.
“This will be the first time electronic payments may be made using the Mentalku mobile app or at their testing centers. So, this is a huge win that is potentially worth millions in transaction and service fees. It also underscores the highly competitive solution it provides potential partners, and the value of our strategic investment in developing AppLogiq’s mobile fintech platform.
“On the DataLogiq side, we continued to build out our Logiq Digital Marketing (LDM) platform. We added a new audio marketing channel. In addition to web, mobile and Connected TV, the digital marketing agencies and brands on our platform can add audio-based advertising to their multi-channel e-commerce marketing campaigns. This is a fast-growing area of digital marketing that we can now tap, and it has already attracted new clients to our platform.
“In fact, in just a very short span of time, more than a dozen agencies, like Decibel, Sway Group, and Digible, are now using LDM to ramp up their media buying programs for the many brands they serve. They have also provided us tremendous endorsements.”
Danielle Wiley, CEO of Sway Group, commented: “We decided to partner with Logiq Digital Marketing because of their modern approach to programmatic advertising. They built a platform that supports our data activation and media buying needs across the digital channels we need for our clients’ advertising campaigns. Their attention to getting us onboarded quickly, their responsiveness, and their high level of support have made them fabulous partners as we grow this offering.”
Suen continued: “LDM represents one of our lines of business that generates very high-margin revenue streams for us and our partners, so we’re very excited about its rapid growth and expansion with talented firms like the Sway Group.
“Perhaps the most significant operational event for the quarter was our IPO on a senior exchange in Canada. The IPO raised ~C$6.5 million (~US$5.3 million) in gross proceeds and was followed recently by a post-IPO raise of an additional US$4 million. These additional capital resources will support our growth initiatives, and advance us toward achieving our higher margin and profitability goals.
“We continue to see strong market trends driving phenomenal growth in the e-commerce markets worldwide. So, we believe the combination of DataLogiq’s robust digital marketing solutions and AppLogiq’s m-commerce fintech technology will help drive increased global market penetration over the coming quarters, along with strong revenue growth and expanding margins.”
Q2 2021 Financial Summary
Revenue increased 3% sequentially to $8.3 million in the second quarter of 2021, and decreased 11% as compared to $9.3 million in the same year-ago quarter. The decrease from the year-ago period was primarily due to a decrease in AppLogiq PaaS revenue as it transitioned to high-margin deployments, which was partially offset by an increase in DataLogiq revenue. The quarterly sequential increase was due to growth in AppLogiq revenue.
AppLogiq contributed $2.8 million or 34% of consolidated revenue in Q2 2021, a decrease of 50% from $5.7 million or 61% of consolidated revenue in the same year-ago period. The decrease was primarily due to the transition away from bulk white label distributors to higher margin direct end users as well as ongoing effects of COVID in some markets.
DataLogiq contributed $5.5 million or 66% of consolidated revenue in Q2 2021, which increased 49% from $3.7 million or 39% of consolidated revenue in the same year-ago period. The increase was primarily due to an increasing focus on its data monetization business.
Overall gross profit increased 10% sequentially to $2.4 million or 29.5% of revenue in Q2 2021, and increased 101% from $1.2 million or 13.1% of revenue in the same year-ago period.
AppLogiq’s gross profit increased 38% to $901,000 or 31.7% of AppLogiq revenue in Q2 2021 from $653,000 or 11.6% of AppLogiq revenue in the same year-ago period. The increase was primarily due to the change in strategic focus from bulk white label distributors to high-margin direct marketing end users.
DataLogiq’s gross profit increased 173% to $1.5 million or 28.4% of DataLogiq revenue in Q2 2021 compared to $567,000 or 15.5% of DataLogiq revenue in the same year-ago period. The increase was due to an increase in data monetization revenues and a decrease in overall customer acquisition costs.
Total operating expenses increased 24% sequentially to $7.8 million in Q2 2021, and increased 198% compared to $2.6 million in the same year-ago period. The increase in operating expenses was mainly due to an increase in general and administrative expenses of $3.8 million, which included costs incurred from the company’s listing on a senior exchange in Canada. The increase in operating expenses was also…