Creatd Provides Update on Balance Sheet and Financing Activities

Rhea-AI Summary

Creatd, Inc. (Nasdaq CM: CRTD) provided an update on its financial status, announcing a successful registered direct offering of 850,000 shares, yielding over $3.4 million in net proceeds. The total cash raised recently, including warrant exercises, is over $7.8 million, strengthening its balance sheet. Creatd has significantly reduced its debt by 56% to $1.1 million and expects $1.6 to $1.8 million in revenues for Q4 2021, showcasing continued growth despite ongoing supply chain challenges.

Positive

• Raised over $7.8 million in cash proceeds from share offerings and warrant exercises.
• Reduced debt by 56% to $1.1 million since Q3 2021.
• Projected Q4 revenues of $1.6 to $1.8 million, indicating a growth rate of 30% to 50%.

Negative

• Remaining debt of $660,000 related to an acquisition and $200,000 in a PPP loan.

NEW YORK, Nov. 1, 2021 /PRNewswire/ -- Creatd, Inc. (Nasdaq CM: CRTD) ("Creatd" or the "Company"), the parent company of Vocal, today provided an update on its unaudited balance sheet, recent funding, and other financial information. Last week, the Company announced the close of its registered direct offering of 850,000 shares, priced at the market under Nasdaq rules and yielding over $3.4 million in net proceeds to the Company. In addition to the financing, the Company recently brought in $4.4 million in cash through the exercise of warrants. In total, the Company last week received over $7.8 in cash proceeds, significantly strengthening its balance sheet.

Between October 22 and October 29, 2021, the Company saw the exercise of approximately 875,000 warrants into shares of common stock at an exercise price of $4.50, as well as approximately $1.1 million in debt conversions at a price of $5.00 per share; with these conversions, the Company has now fully eliminated all debt remaining from its May 2021 convertible note offering. After factoring in the above transactions, Creatd now has approximately 16.3 million shares issued and outstanding. Additionally, there currently remain approximately 3 million outstanding privately-held warrants, the majority of which may be exercised at a price of $4.50, and 2.5 million publicly traded warrants having exercise prices of $4.50.

Creatd is pleased to report that it has now paid off nearly all remaining debt on its balance sheet, with the exception of a $660,000 note related to the acquisition of Seller's Choice and approximately $200,000 in an outstanding PPP loan. As of today, the Company has settled most of its outstanding payables including legal, accounting, and technology development fees. The Company also has a credit in the amount of approximately $500,000 with its development partner, Thinkmill. Additionally, the Company allocated $1.8 million to fully pay down its existing balance with third party marketing platforms, leaving Creatd the ability to draw down on up to $3 million in available credit with its long-standing social media partners.

Commented Creatd founder and co-CEO, Jeremy Frommer, "Having made progress on all of the above payables, as well as closed our recent financing, our company now has in excess of $5 million in cash plus the aforementioned vendor credits to support our strategic growth plans. Having considerably fortified our balance sheet and reduced our debt by 56% to $1.1 million since the end of third quarter, we are well-positioned to execute across all four of Creatd's pillars."

Frommer continued, "While we progress toward our 100,000 Vocal+ member milestone, we have been able to significantly reduce our dependence on third party social media marketing platforms. As a result, we saw a 57% reduction in marketing costs between the second and third quarters. For the fourth quarter of 2021, we expect marketing costs to remain under $2 million; outside of marketing costs, we expect operating expenses as a whole to stay consistent with previous quarterly levels.

"We estimate third quarter net revenues of approximately $1.2 million, representing a 24% increase from the second quarter of 2021 and our fourth consecutive quarter of double-digit growth. In addition, we currently project between $1.6 and $1.8 million in revenues for the fourth quarter, a 30% to 50% quarter-over-quarter growth rate."

Explained Creatd co-CEO, Laurie Weisberg, "Our third and fourth quarter 2021 revenue expectations factor in the supply chain challenges that have disrupted e-commerce on a global scale. With those disruptions in mind,  we still expect to see Creatd Ventures' e-commerce businesses continue to ramp up and begin materially impacting revenues in Q1 2022. With our third quarter numbers expected to be released on November 15, we look forward to sharing a more in depth understanding of the Creatd Partners' agency business and its growth, particularly since the acquisition of the WHE Agency."

About Creatd
Creatd, Inc. (Nasdaq CM: CRTD) is a creator-first technology company and the parent company of the Vocal platform. Our mission is to empower creators, entrepreneurs, and brands through technology and partnership.

For news and updates, subscribe to Creatd's newsletter: https://creatd.com/newsletter

Investor Relations Contact: ir@creatd.com

Forward-Looking Statements
Any statements that are not historical facts and that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance (often, but not always, indicated through the use of words or phrases such as "will likely result," "are expected to," "will continue," "is anticipated," "estimated," "intends," "plans," "believes" and "projects") may be forward-looking and may involve estimates and uncertainties which could cause actual results to differ materially from those expressed in the forward-looking statements. We caution that the factors described herein could cause actual results to differ materially from those expressed in any forward-looking statements we make and that investors should not place undue reliance on any such forward-looking statements. Further, any forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of anticipated or unanticipated events or circumstances. New factors emerge from time to time, and it is not possible for us to predict all of such factors. Further, we cannot assess the impact of each such factor on our results of operations or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. This press release is qualified in its entirety by the cautionary statements and risk factor disclosure contained in our SEC filings.

 

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SOURCE Creatd, Inc.

FAQ

What recent financing activities did Creatd announce on November 1, 2021?

Creatd announced a registered direct offering of 850,000 shares, raising over $3.4 million in net proceeds.

How much total cash has Creatd raised recently?

Creatd has raised over $7.8 million from share offerings and warrant exercises.

What is Creatd's current debt situation?

Creatd has reduced its debt by 56% to $1.1 million, with remaining debts including a $660,000 note and a $200,000 PPP loan.

What revenue is Creatd projecting for the fourth quarter of 2021?

Creatd projects revenues between $1.6 million and $1.8 million for Q4 2021, representing a growth rate of 30% to 50%.

When will Creatd release its third quarter 2021 numbers?

Creatd plans to release its third quarter results on November 15, 2021.