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Third Quarter Revenue increased to $50.9 million
U.S. Revenue grew 46% year-over-year with Total Revenue growth of 9% year-over-year
IRVINE, Calif.–(BUSINESS WIRE)–WM Technology, Inc. (“WM Technology” or the “Company”) (Nasdaq: MAPS), a leading technology and software infrastructure provider to the cannabis industry, today announced its financial results for the third quarter ended September 30, 2021.
“Our third quarter results reflect the momentum we are seeing as we focus on executing and investing against our growth opportunities. We achieved revenue growth in the U.S. of 46% year-over-year, maintained healthy EBITDA profitability and also had double-digit year-over-year growth across a number of our key metrics. Our ability to outpace our end-market growth is especially notable given the challenges many of our clients faced given what we believe is accelerating consumer demand shifts to non-licensed channels,” said Chris Beals, CEO and Chairman of WM Technology. “Additionally, we continue to accelerate investment in both organic and inorganic growth in our platform during the third quarter as we look towards 2022. In addition to the acquisition of Sprout announced in mid-September, we also acquired the parent company to Cannveya and CannCurrent. These acquisitions complement the suite of integrated solutions we provide through our WM Business offering that help both large and small clients. We are very excited to welcome each of these teams and technology to the WM Technology family and are more excited than ever at the near and long-term opportunity for WM Technology.”
Third Quarter 2021 Financial Highlights
Reconciliations of GAAP to non-GAAP financial measures have been provided in the tables included in this release.
______________________________
Third Quarter 2021 Operational Highlights
Fourth Quarter Business Outlook
Based on current business trends and conditions, the outlook for the fourth quarter of the year ending December 31, 2021, is expected to be as follows:
The guidance provided above is only an estimate of what we believe is realizable as of the date of this release. We are not readily able to provide a reconciliation of projected Adjusted EBITDA to projected net income without unreasonable effort. This guidance assumes that no business acquisitions, investments, restructurings, or legal settlements are concluded in the quarter. Our results are based on assumptions that we believe to be reasonable as of this date, but may be materially affected by many factors, as discussed below in “Forward-Looking Statements.” Actual results may vary from the guidance and the variations may be material. We undertake no intent or obligation to publicly update or revise any of these projections, whether as a result of new information, future events or otherwise, except as required by law.
Investor Conference Call and Webcasts
The Company will host a conference call and webcast today, Thursday, November 11, 2021, at 2:00 p.m. Pacific Time (5:00 p.m. Eastern Time) by dialing (833) 855-0799 (United States and Canada) or (409) 937-8921 (International) and providing Conference ID 1999619. A live webcast of the call will also be available on the WM Technology investor relations website at ir.weedmaps.com.
A telephone replay of the call may be accessed the same day from Thursday, November 11, 2021 until 5:00 Pacific Time (8:00 p.m. Eastern Time) on Thursday, November 18, 2021 by dialing (855) 859-2056 (United States and Canada) or (404) 537-3406 (International) and providing Conference ID 1999619. A webcast replay will also be archived at ir.weedmaps.com.
About WM Technology
The Company’s mission is to power a transparent and inclusive global cannabis economy. Now in its second decade, WM Technology has been a driving force behind much of the legislative change we’ve seen in the past 10 years.
Founded in 2008, WM Technology, is a leading technology and software infrastructure provider to the cannabis industry, comprising a B2C platform, Weedmaps, and B2B software, WM Business. The cloud-based SaaS solutions from WM Business provide an end-to-end operating system for cannabis retailers. WM Business’ tools support compliance with the complex, disparate, and constantly evolving regulations applicable to the cannabis industry. Through its website and mobile apps, WM Technology provides consumers with the latest information about cannabis retailers, brands, and products, facilitating product discovery and driving engagement with our retail and brand customers.
WM Technology holds a strong belief in the power of cannabis and the importance of enabling safe, legal access to consumers worldwide. Since inception, WM Technology has worked tirelessly, not only to become the most comprehensive platform for consumers, but to build the software solutions that power businesses compliantly in the space, to advocate for legalization, social equity, and licensing in many jurisdictions, and to facilitate further learning through partnering with subject matter experts on providing detailed, accurate information about the plant.
Headquartered in Irvine, California, WM Technology supports remote work for all eligible employees. Visit us at www.weedmaps.com.
Forward-Looking Statements
This press release includes “forward-looking statements” regarding our future business expectations which involve risks and uncertainties. Forward-looking statements may be identified by the use of words such as “estimate,” “plan,” “project,” “forecast,” “intend,” “will,” “expect,” “anticipate,” “believe,” “seek,” “target” or other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward-looking statements include, but are not limited to, statements regarding estimates and forecasts of financial and performance metrics and projections of market opportunity and market share. These statements are based on various assumptions, whether or not identified in this press release, and on the current expectations of the Company’s management and are not predictions of actual performance. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond the control of the Company. These forward-looking statements are subject to a number of risks and uncertainties, including the Company’s financial and business performance, including key business metrics and any underlying assumptions thereunder; market opportunity and the Company’s ability to acquire new customers and retain existing customers; expectations and timing related to commercial product launches; success of the Company’s go-to-market strategy; ability to scale its business and expand its offerings; the Company’s competitive advantages and growth strategies; the Company’s future capital requirements and sources and uses of cash; the Company’s ability to obtain funding for our future operations; the outcome of any known and unknown litigation and regulatory proceedings; changes in domestic and foreign business, market, financial, political and legal conditions; risks relating to the uncertainty of the projected financial information with respect to the Company; future global, regional or local economic and market conditions affecting the cannabis industry; the development, effects and enforcement of and changes to laws and regulations, including with respect to the cannabis industry; the Company’s ability to successfully capitalize on new and existing cannabis markets, including its ability to successfully monetize its solutions in those markets; the Company’s ability to manage future growth; the Company’s ability to develop new products and solutions, bring them to market in a timely manner, and make enhancements to its platform and the Company’s ability to maintain and grow its two-sided digital network, including its ability to acquire and retain paying customers; the effects of competition on the Company’s future business; the Company’s success in retaining or recruiting, or changes required in, officers, key employees or directors; the possibility that we may be adversely affected by other economic, business or competitive factors; that the Company identified a material weakness in its internal control over financial reporting which, if not corrected, could affect the reliability of its consolidated financial statements; the possibility that the Company may be adversely affected by other economic, business or competitive factors; and those factors discussed in the Company’s Quarterly Report on Form 10-Q filed with Securities and Exchange Commission (the “SEC”) on August 13, 2021 and subsequent Form 10-Qs or Form 8-Ks filed with the SEC. If any of these risks materialize or these assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that the Company does not presently know or that the Company currently believes are immaterial that could also cause actual results to differ from those contained in the forward looking statements. In addition, forward-looking statements reflect the Company’s expectations, plans or forecasts of future events and views as of the date of this press release. The Company anticipates that subsequent events and developments will cause the Company’s assessments to change. However, while the Company may elect to update these forward-looking statements at some point in the future, the Company specifically disclaims any obligation to do so, except as required by law. These forward-looking statements should not be relied upon as representing the Company’s assessments as of any date subsequent to the date of this press release. Accordingly, undue reliance should not be placed upon the forward-looking statements.
Use of Non-GAAP Financial Measures
To provide investors with additional information regarding our financial results, we have disclosed EBITDA and Adjusted EBITDA, both of which are non-GAAP financial measures that we calculate as net income before interest, taxes and depreciation and amortization in the case of EBITDA and further adjusted to exclude non-cash, unusual and/or infrequent costs in the case of Adjusted EBITDA. Below we have provided a reconciliation of net income (the most directly comparable GAAP financial measure) to EBITDA and from EBITDA to Adjusted EBITDA.
We present EBITDA and Adjusted EBITDA because these metrics are a key measure used by our management to evaluate our operating performance, generate future operating plans and make strategic decisions regarding the allocation of investment capacity. Accordingly, we believe that EBITDA and Adjusted EBITDA provide useful information to investors and others in understanding and evaluating our operating results in the same manner as our management.
EBITDA and Adjusted EBITDA have limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are as follows:
Because of these limitations, you should consider EBITDA and Adjusted EBITDA alongside other financial performance measures, including net income and our other GAAP results.
Definition of Key Operating and Financial Metrics
WM TECHNOLOGY, INC. AND SUBSIDIARIES |
|||||||||
CONSOLIDATED BALANCE SHEETS |
|||||||||
(Unaudited) |
|||||||||
(In thousands, except for share data) |
|||||||||
|
|
September 30, 2021 |
|
December 31, 2020 |
|||||
Assets |
|
|
|
|
|||||
Current assets |
|
|
|
|
|||||
Cash |
|
$ |
77,935 |
|
|
|
$ |
19,919 |
|
Accounts receivable, net |
|
12,784 |
|
|
|
9,428 |
|
||
Prepaid expenses and other current assets |
|
15,338 |
|
|
|
4,820 |
|
||
Total current assets |
|
106,057 |
|
|
|
34,167 |
|
||
Property and equipment, net |
|
10,031 |
|
|
|
7,387 |
|
||
Goodwill |
|
45,658 |
|
|
|
3,961 |
|
||
Intangible assets, net |
|
8,446 |
|
|
|
4,505 |
|
||
Right-of-use assets |
|
37,673 |
|
|
|
— |
|
||
Deferred tax asset |
|
147,972 |
|
|
|
— |
|
||
Other assets |
|
6,787 |
|
|
|
3,874 |
|
||
Total assets |
|
$ |
362,624 |
|
|
|
$ |
53,894 |
|
Liabilities and Equity |
|
|
|
|
|||||
Current liabilities |
|
|
|
|
|||||
Accounts payable and accrued expenses |
|
$ |
23,881 |
|
|
|
$ |
12,651 |
|
Deferred revenue |
|
7,759 |
|
|
|
5,264 |
|
||
Deferred rent |
|
— |
|
|
|
5,129 |
|
||
Operating lease liabilities, current |
|
5,256 |
|
|
|
— |
|
||
Notes payable to members |
|
— |
|
|
|
205 |
|
||
Other current liabilities |
|
1,000 |
|
|
|
— |
|
||
Total current liabilities |
|
37,896 |
|
|
|
23,249 |
|
||
Operating lease liabilities, non-current |
|
40,813 |
|
|
|
— |
|
||
Tax receivable agreement liability |
|
126,150 |
|
|
|
— |
|
||
Warrant liability |
|
110,350 |
|
|
|
— |
|
||
Other long-term liabilities |
|
— |
|
|
|
1,374 |
|
||
Total liabilities |
|
315,209 |
|
|
|
24,623 |
|
||
Stockholders’ equity/Members’ equity |
|
|
|
|
|||||
Preferred Stock – $0.0001 par value; 75,000,000 shares authorized; no shares issued and outstanding at September 30, 2021 and December 31, 2020 |
|
— |
|
|
|
— |
|
||
Class A Common Stock – $0.0001 par value; 1,500,000,000 shares authorized; 65,677,361 shares issued and outstanding at September 30, 2021 and no shares issued and outstanding at December 31, 2020 |
|
7 |
|
|
|
— |
|
||
Class V Common Stock – $0.0001 par value; 500,000,000 shares authorized, 65,502,347 shares issued and outstanding at September 30, 2021 and no shares issued and outstanding at December 31, 2020 |
|
7 |
|
|
|
— |
|
||
Additional paid-in capital |
|
(3,592 |
) |
|
|
— |
|
||
Retained earnings |
|
26,084 |
|
|
|
— |
|
||
Total WM Technology, Inc. stockholders’ equity |
|
22,506 |
|
|
|
— |
|
||
Noncontrolling interests |
|
24,909 |
|
|
|
— |
|
||
Members’ equity |
|
— |
|
|
|
29,271 |
|
||
Total equity |
|
47,415 |
|
|
|
29,271 |
|
||
Total liabilities and stockholders’ equity/members’ equity |
|
$ |
362,624 |
|
|
|
$ |
53,894 |
|
WM TECHNOLOGY, INC. AND SUBSIDIARIES |
|||||||||||||||
CONSOLIDATED STATEMENTS OF INCOME |
|||||||||||||||
(Unaudited) |
|||||||||||||||
(In thousands, except for share data) |
|||||||||||||||
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||||||
Revenues |
$ |
50,884 |
|
|
$ |
46,505 |
|
|
$ |
138,969 |
|
|
$ |
117,470 |
|
|
|
|
|
|
|
|
|
||||||||
Operating expenses |
|
|
|
|
|
|
|
||||||||
Cost of revenues |
2,035 |
|
|
2,109 |
|
|
5,800 |
|
|
5,572 |
|
||||
Sales and marketing |
12,806 |
|
|
7,384 |
|
|
37,194 |
|
|
21,437 |
|
||||
Product development |
7,782 |
|
|
6,923 |
|
|
25,921 |
|
|
20,325 |
|
||||
General and administrative |
23,220 |
|
|
12,906 |
|
|
70,356 |
|
|
37,147 |
|
||||
Depreciation and amortization |
980 |
|
|
991 |
|
|
2,970 |
|
|
2,980 |
|
||||
Total operating expenses |
46,823 |
|
|
30,313 |
|
|
142,241 |
|
|
87,461 |
|
||||
Operating income (loss) |
4,061 |
|
|
16,192 |
|
|
(3,272) |
|
|
30,009 |
|
||||
Other income (expenses) |
|
|
|
|
|
|
|
||||||||
Change in fair value of warrant liability |
45,837 |
|
|
— |
|
|
83,628 |
|
|
— |
|
||||
Other expense, net |
(300) |
|
|
(662) |
|
|
(6,341) |
|
|
(1,277) |
|
||||
Income before income taxes |
49,598 |
|
|
15,530 |
|
|
74,015 |
|
|
28,732 |
|
||||
Provision for income taxes |
393 |
|
|
— |
|
|
242 |
|
|
— |
|
||||
Net income |
49,205 |
|
|
15,530 |
|
|
73,773 |
|
|
28,732 |
|
||||
Net income attributable to noncontrolling interests |
28,370 |
|
|
— |
|
|
48,675 |
|
|
— |
|
||||
Net income attributable to WM Technology, Inc. |
$ |
20,835 |
|
|
$ |
15,530 |
|
|
$ |
25,098 |
|
|
$ |
28,732 |
|
|
|
|
|
|
|
|
|
||||||||
Class A Common Stock: |
|
|
|
|
|
|
|
||||||||
Basic income per share |
$ |
0.32 |
|
|
N/A¹ |
|
$ |
0.39 |
|
|
N/A¹ |
||||
Diluted income (loss) per share |
$ |
0.02 |
|
|
N/A¹ |
|
$ |
(0.15) |
|
|
N/A¹ |
||||
|
|
|
|
|
|
|
|
||||||||
Class A Common Stock: |
|
|
|
|
|
|
|
||||||||
Weighted average basic shares outstanding |
64,216,732 |
|
|
N/A¹ |
|
64,149,699 |
|
|
N/A¹ |
||||||
Weighted average diluted shares outstanding |
68,304,372 |
|
|
N/A¹ |
|
69,950,141 |
|
|
N/A¹ |
||||||
______________________________
1Prior to the Business Combination on June 16, 2021, the membership structure of the Company included units which had profit interests. The Company analyzed the calculation of earnings per unit for periods prior to the Business Combination and determined that it resulted in values that would not be meaningful to the users of these consolidated financial statements.
Contacts
Investors:
Greg Stolowitz
gstolowitz@weedmaps.com
949.345.7579
Media:
Travis Rexroad
trexroad@weedmaps.com
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