Tenet Fintech Sees Revenues Decline 33% In Q3, Expects To Miss Full-Year Guidance
Tenet Fintech (CSE: PKK) this morning reported declining quarterly revenues for the second straight quarter this morning, blaming the decline on government-imposed lockdowns in China. At the same time, the firm cautioned that the results will “likely” cause its annual performance to fall short of guidance issued this past May.
Revenue for the quarter came in at $21.6 million, a 33.4% decline over the second quarter, while year to date revenues hit $88.8 million, putting the company on a run rate far short of achieving the previously guided $210.0 million in revenue. Prior to the May update, Tenet had provided revenue guidance of $345.0 million for the year.
READ: Tenet Fintech Cuts Revenue Guidance 39%, EBITDA Guidance 92% For 2022
The decline in revenue for the quarter was blamed on “random lockdowns” which “continued to plague the Chinese economy.” The company indicated that it continued to diversify its revenue stream during the quarter within China. In Canada, the company continued to grow its operations in anticipation of the launch of its Business Hub in late 2022, with the firms Canadian business unit said to account for 20% of expenses during the quarter, while 4,000 small and medium-sized business are said to now be pre-registered on the platform awaiting launch.
Expenses during the quarter amounted to $30.2 million, lead by cost of services of $17.0 million, and an impairment of intangible assets of $4.2 million. The firm overall reported a net loss of $7.7 million for the quarter, while adjusted EBITDA is said to have amounted to a loss of $3.8 million.
Looking to the balance sheet, the company saw its cash position fall from $15.0 million to $8.5 million during the quarter, with total current assets now sitting at $77.5 million. Current liabilities meanwhile sit at $17.7 million, of which $13.9 million is attributable to accounts payable.
In terms of its cash position, the company is reportedly still waiting on the approval of a short form prospectus filed with the Ontario Securities Commission for $30 million, while also waiting on a response from the Securities and Exchange Commission in relation to the re-instatement of its listing on the Nasdaq. The company is also now reportedly looking to list on the London Stock Exchange.
Current cash as of November 29 is said to sit at $4.15 million.
Tenet Fintech last traded at $0.91 on the CSE.
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