OneSoft Solutions Inc. Reports Annual Results for Fiscal 2020 Posting 50% YOY Revenue Increase

Rhea-AI Summary

OneSoft Solutions reports a significant 50% revenue increase for the fiscal year 2020, totaling C$4.056 million, despite pandemic challenges. Annual recurring revenue rose 57%, driven by existing clients using their Cognitive Integrity Management (CIM) SaaS. However, the overall revenue growth fell short of expectations. The company retains a strong balance sheet with C$7.2 million in cash and no debt. Recent developments include new IP acquisition and active sales initiatives in multiple countries, indicating potential future growth.

Positive

• 50% revenue increase in Fiscal 2020 compared to 2019.
• Annual recurring revenue grew by 57% due to increased usage of CIM by existing clients.
• Strong balance sheet with C$7.2 million in cash and no debt.
• Active sales initiatives in several countries indicate future growth potential.

Negative

• Revenue growth was about half of management's initial forecasts for Fiscal 2020.
• Sales activities faced challenges during the pandemic, particularly from March to September.

EDMONTON, AB / ACCESSWIRE / March 25, 2021 / OneSoft Solutions Inc. (the "Company" or "OneSoft") (TSXV:OSS)(OTCQB:OSSIF), a North American developer of cloud-based business solutions, announces its financial results for the year ended December 31, 2020 ("Fiscal 2020") and provides a business update.

Please refer to the Audited Consolidated Financial Statements, Management's Discussion and Analysis ("MD&A") and the Annual Information Form for the year ended December 31, 2020 filed on SEDAR at www.sedar.com for more information. The MD&A contains discussion of the OneBridge Innovation Lab & Technology Roadmap, the Cognitive Integrity Management ("CIM") Technology Advantage and an in-depth analysis of Potential Markets for CIM along with complete analysis of Fiscal 2020, the financial quarter ended December 31, 2020 and other information. Unless otherwise specified, all dollar amounts are denominated in Canadian dollars.

FINANCIAL RESULTS

		Three months ended								Year ended
(in C$,000, per share in C$)		December 31, 2020				December 31, 2019				December 31, 2020				December 31, 2019
		$				$				$				$
Revenue			966				640				4,056				2,712
Gross profit			776				382				3,135				2,010
Net loss			(939)				(1,125)				(3,256)				(3,606)
Exchange gain (loss) on translation of foreign operations			(5)				7				(23)				21
Comprehensive loss			(944)				(1,118)				(3,279)				(3,585)
Weighted average common shares outstanding - basic and fully diluted (000)'s			115,342				112,676				114,522				108,974
Net loss per share			(0.01)				(0.01)				(0.03)				(0.03)
Cash and short-term investments			7,223				10,503				7,223				10,503
Working capital			6,226				8,221				6,226				8,221

HIGHLIGHTS OF FISCAL 2020

• Revenue for the year ended December 31, 2020 increased 50% over Fiscal 2019, despite the disruption to business operations posed by the Covid pandemic. Annual recurring revenue increased 57% due to existing clients, in aggregate, consuming more CIM Software-as-a-Service ("SaaS").
• The year-over-year revenue increase was about half of what Management forecasted for Fiscal 2020, prior to the onset of the pandemic. Sales activities were challenged, particularly between March and September, because prospective clients prioritized and focused on transitioning to remote employee-based work models rather than investigation of new solutions. Notwithstanding the Covid challenges, generation of new sales leads, sales activities and Production Trials increased in Q3 and Q4 of 2020. This business activity in the second half of Fiscal 2020 involved prospective customers in the U.S.A., South America, Australia and Middle East countries, which we anticipate may result in new commercial contracts for future CIM use.
• At December 31, 2020, cash and short-term investments totaled $7.2 million ($10.5 million at December 31, 2019), working capital (current assets less current liabilities) was $6.2 million ($8.2 million at December 31, 2019), and the Company has no debt. Assuming customers renew and pay their 2021 contracts for CIM usage similar to fiscal 2020 and assuming no significant changes in its current business strategies and cash consumption, the Company believes it has sufficient cash on hand to fund its business and growth strategies as envisioned.

ACTIVITIES SUBSEQUENT TO FISCAL 2020 YEAR END

• On January 13, 2021 the Company announced the closing of a CIM sale due to sales efforts conducted in Fiscal 2020.
• On March 2, 2021 the Company co-presented a white paper at a Pipeline Research Council International ("PRCI") conference attended by 1,350 registrants from 17 countries. An industry expert who is an employee of Worley/Advisian, the Australian-based reseller partner that is introducing CIM to its global client base as part of its offerings associated with high-value engineering and digital transformation services, co-presented with OneSoft. Following its recent acquisition of Jacobs Engineering, Worley/Advisian, is now one of the largest international engineering firms conducting business globally with oil and gas operators. The PRCI presentation involved several case studies of work performed by Worley/Advisian engineers, highlighting CIM's high value proposition versus conventional industry systems and processes. This presentation has generated global interest which will be followed up by the Company and Worley/Advisian.
• On March 9, 2021 the Company announced acquisition of IP that is being integrated into the CIM platform as a component of its risk compliance functionality. The acquired IP includes algorithms and processes that leverage machine learning to perform data analytics which calculate the probability that anomalies found in pipeline inspections may exceed the pipeline's maximum operating pressure. The analysis, often referred to as probability of exceedance ("POE"), supports the prioritization of on-going inspections and mitigations and aligns with regulatory requirements mandated by PHMSA 192 & 195 safety statutes for U.S. pipeline operations. The total cost of this acquired IP was $205,800, which included a cash payment of US$100,000 and an issuance of 120,000 shares of the Company's common stock with a market value of C$0.66 per share on the date that both parties agreed to the transaction.

BUSINESS OUTLOOK

With the progress the Company is making to advance our technology, solutions and market presence, we remain confident that our competitive moat continues to increase. Based on certain research and business development initiatives conducted in Fiscal 2020, we maintain our belief that CIM's unique functionality has not been replicated elsewhere. We further believe that our born-in-the-cloud approach to develop software based on machine learning, data science and Microsoft cloud computing will continue to outpace industry vendors that attempt to update legacy systems. Research conducted in Fiscal 2020 with some of the industry's top experts provides compelling justification that supports CIM's high value proposition versus other vendor solutions. Knowledge of our solutions is becoming known globally through technical publications and word of mouth referrals, which we believe will assist the Company to gain market traction.

Interest in CIM continues to increase, with sales activities currently underway in the U.S.A., Canada, Australia, United Arab Emirates, Brazil, and Argentina. Numerous CIM Production Trials are planned or in various stages of completion, which we anticipate will result in completed sales in future periods. Various business development initiatives are also underway, with the objectives to recruit CIM resellers and identify new potential markets and revenue sources based on our CIM technology and platform.

Given the Company's strong balance sheet with $7.7 million of cash and equivalents as at March 23, 2021, no debt, current cash burn rate, and anticipated revenue going forward, Management believes the Company is well-funded to execute current business plans as envisioned without having to raise additional capital.

WEBCAST: ANNUAL GENERAL AND SPECIAL MEETING OF THE SHAREHOLDERS MAY 4, 2021

During the Annual General Meeting of the Shareholders, and after the formal portion of the Meeting, Management will review the Fiscal 2020 results and answer shareholder questions. The Meeting will be held May 4, 2021 at 1:00 pm Mountain time and may be attended by clicking this link: https://global.gotowebinar.com/join/4846692748557076749/990365724 or by calling 866-952-7297and entering Access Code 529-763-905.

ON BEHALF OF THE BOARD OF DIRECTORS
ONESOFT SOLUTIONS INC.

Douglas Thomson
Chair

For more information, please contact

Dwayne Kushniruk, CEO dkushniruk@onesoft.ca 587-416-6787	Sean Peasgood, Investor Relations Sean@SophicCapital.com 647-494-7710

Forward-looking Statements

This news release contains forward-looking statements relating to the future operations and profitability of the Company and other statements that are not historical facts. Forward-looking statements are often identified by terms such as "may", "should", "anticipate", "expects", "believe", "will", "intends", "plans" and similar expressions. Any statements that are contained in this news release that are not statements of historical fact may be deemed to be forward-looking statements. Such forward-looking information is provided to deliver information about management's current expectations and plans relating to the future. Investors are cautioned that reliance on such information may not be appropriate for other purposes, such as making investment decisions.

In respect of the forward-looking information and statements the Company has placed reliance on certain assumptions that it believes are reasonable at this time, including expectations and assumptions concerning, among other things: the impact of Covid-19 on the business operations of the Company and its current and prospective customers, the availability and cost of labor and services; the efficacy of its software; our interpretation based on various industry information sources regarding the total miles of pipeline in the USA and globally, which segments are piggable; our understanding of metrics, activities and costs regarding evaluation, inspection and maintenance is in alignment with various industry information sources and is reasonably accurate; that counterparties to material agreements will continue to perform in a timely manner; that there are no unforeseen events preventing the performance of contracts; that there are no unforeseen material development or other costs related to current growth projects or current operations; the success of growth projects; future operating costs; interest and foreign exchange rates; planned synergies, capital efficiencies and cost-savings; the sufficiency of budgeted capital expenditures in carrying out planned activities; and no changes in applicable tax laws. Accordingly, readers should not place undue reliance on the forward-looking information contained in this press release. Since forward-looking information addresses future events and conditions, such information by its very nature involves inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to many factors and risks. These include but are not limited to the risks associated with the industries in which the Company operates in general such as: costs and expenses; interest rate and exchange rate fluctuations; competition; ability to access sufficient capital from internal and external sources; and changes in legislation, including but not limited to tax laws.

Readers are cautioned that the foregoing list of factors is not exhaustive. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement. The forward-looking statements contained in this news release are made as of the date of this news release, and the Company undertakes no obligation to update publicly or to revise any of the included forward-looking statements, whether because of new information, future events or otherwise, except as expressly required by Canadian securities law.

This news release does not constitute an offer to sell or the solicitation of an offer to buy any securities within the United States. The securities to be offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended, or any state securities laws, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of such Act or other laws.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

SOURCE: OneSoft Solutions Inc.

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FAQ

What were OneSoft's financial results for Fiscal 2020?

OneSoft reported a 50% revenue increase to C$4.056 million for Fiscal 2020 compared to 2019.

How did the pandemic affect OneSoft's sales activities?

Sales activities were challenged, especially between March and September 2020, as clients focused on remote work adaptations.

What is the outlook for OneSoft following the recent developments?

OneSoft is confident in its growth potential, with active sales processes in various countries and a strong balance sheet.

What is the stock symbol for OneSoft Solutions?

OneSoft Solutions trades under the stock symbol OSSIF on OTCQB and OSS on TSXV.