Tenet Fintech Sees Revenue Fall 33% in Q3, Expects to Miss Full-Year Guidance
Tenet Fintech (CSE: PKK) this morning reported falling quarterly revenue for the second straight quarter this morning, blaming the decline on government-imposed lockdowns in China. At the same time, the firm warned that the results would “likely” cause annual performance to fall below guidance issued in May.
Revenue for the quarter came in at $21.6 million, down 33.4% over the second quarter, while year-to-date revenue reached $88.8 million, putting the company on a run rate well below the previously guided 210 .0 million dollars 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 by 39%, EBITDA guidance by 92% for 2022
The decline in revenue for the quarter was blamed on “random shutdowns” that “continued to plague the Chinese economy.” The company indicated that it continued to diversify its revenue stream during the quarter in China. In Canada, the company continued to ramp up its operations in anticipation of the launch of the Business Hub in late 2022, with the company’s Canadian business unit said to account for 20% of spend during the quarter, while 4,000 SMEs are said to be pre-registered on the platform pending launch.
Expenses in the quarter totaled $30.2 million, led by service costs of $17.0 million, and an intangible asset impairment charge of $4.2 million. The company reported an overall 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 at 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 at $77.5 million. Current liabilities, meanwhile, are $17.7 million, of which $13.9 million is attributable to accounts payable.
Regarding the cash position, the company is still awaiting approval of a short form prospectus filed with the Ontario Securities Commission for $30 million, while also awaiting a response from the Securities and Exchange Commission in relation to the reintroduction. of the listing on Nasdaq. The company is now reportedly also looking to be listed on the London Stock Exchange.
Current cash as of November 29 is said to be $4.15 million.
Tenet Fintech was last traded at $0.91 on the CSE.
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