Perfect Corp. Reports Unaudited Financial Results for the Nine Months Ended September 30, 2022
Perfect Corp. (NYSE: PERF) reported unaudited financial results for the nine months ending September 30, 2022, showcasing a 22.1% revenue growth to $36.2 million. Gross profit rose to $31.1 million, yielding an 85.7% margin. Notably, net income shifted to $28.5 million from a loss of $3.1 million the previous year. Adjusted net income also improved to $4.1 million, along with a positive adjusted EBITDA of $4.2 million. The company faced challenges like macroeconomic uncertainties impacting new business expansion.
- Total revenues grew to $36.2 million, up 22.1% year over year.
- Gross profit increased to $31.1 million from $25.6 million.
- Net income was $28.5 million, compared to a net loss of $3.1 million a year ago.
- Adjusted net income improved to $4.1 million from an adjusted net loss of $0.6 million.
- The company anticipates revenue for 2022 to be lower than projected due to challenging macroeconomic conditions.
- Prolonged sales cycles are affecting new business expansions.
- Recent strength of the U.S. dollar has created additional revenue growth headwinds.
Highlights for the Nine Months Ended
-
Total revenues grew to
, up$36.2 million 22.1% year over year, primarily due to an increase in AR/AI cloud solutions and subscription revenues. -
Gross profit increased to
from$31.1 million during the comparable periods.$25.6 million -
Net income was
, compared to a net loss of$28.5 million a year ago.$3.1 million -
Adjusted net income (non-IFRS)1 was
, compared to an adjusted net loss of$4.1 million a year ago.$0.6 million -
Adjusted EBITDA (non-IFRS)2 was
compared to an adjusted EBITDA loss of$4.2 million a year ago, primarily due to strong revenue growth and efficient expense controls.$0.03 million -
The Company had 151 Key Customers3 as of
September 30, 2022 , compared with 137 Key Customers as ofSeptember 30, 2021 . -
As of
September 30, 2022 , our customer base includes 483 brand clients, with over 510,000 digital stock keeping units (“SKUs”) for makeup, haircare, skincare, eyewear, and jewelry products, compared with over 450 brand clients and over 500,000 digital SKUs as ofJune 30, 2022 .
Ms.
Mr.
Financial Results for the Nine Months Ended
Revenue
Total revenues increased by
-
AR/AI cloud solutions and subscription revenues increased by
31.0% to from$27.3 million in the same period of 2021, mostly driven by the continued strong demand for the Company’s online virtual product try-on solutions from its brand customers as well as an increase in its monthly active subscribers4.$20.9 million -
Licensing revenues increased by
6.0% to from$7.4 million in the same period of 2021, primarily due to higher demand for the Company’s software development kit (SDK) solutions.$7.0 million -
Advertisement revenues decreased by
22.2% to from$1.4 million in the same period of 2021, consistent with the Company’s strategy of reinforcing its market leadership in providing AR- and AI-SaaS solutions to brand customers and allocating less resources to its mobile apps subscription and advertisement services.$1.8 million
Gross Profit
Gross profit was
Total Operating Expenses
Total operating expenses increased by
-
Sales and marketing (“S&M”) expenses increased by
2.2% to from$18.2 million in the same period of 2021, primarily due to an increase in S&M headcount and related personnel expenses.$17.8 million -
General and administrative (“G&A”) expenses increased by
173.0% to from$7.2 million in the same period of 2021, primarily due to the professional service fees incurred during the course of the company’s de-SPAC transaction and public listing. Excluding those expenses that were one-time in nature, recurring G&A expenses was$2.6 million during the first nine months of 2022.$2.9 million -
Research and development (“R&D”) expenses increased by
24.7% to from$7.9 million in the same period of 2021, primarily due to an increase in R&D headcount and related personnel expenses.$6.3 million
Net Income
Net income was
Adjusted Net Income (Non-IFRS)
Adjusted net income for the nine months ended
Adjusted EBITDA (Non-IFRS)
Adjusted EBITDA improved to positive
Liquidity
As of
Update on Business Combination Projections
Taking into consideration the Company’s unaudited financial results for the nine months ended
The Company further cautions that investors, when making any investment decisions, shall only refer to the Company’s actual financials results disclosed in the Company’s filings with the
Conference Call Information
The Company's management will hold an earnings conference call at
Registration Link: https://registrations.events/direct/Q4E60155
A live and archived webcast of the conference call will also be available at the Company's investor relations website at https://ir.perfectcorp.com.
About
Founded in 2015, Perfect is a global leader in providing AR and AI SaaS solutions to beauty and fashion industries. Utilizing facial 3D modeling, and AI deep learning technologies, Perfect empowers beauty brands with product try-on, facial diagnostics, and digital consultation solutions to provide consumers with an enjoyable, personalized, and convenient omnichannel shopping experience. Today, Perfect has the leading market share in helping the world’s top beauty brands execute digital transformation, improve customer engagement, increase purchase conversion, and drive sales growth while maintaining environmental sustainability and fulfilling social responsibilities. For more information, visit https://ir.perfectcorp.com/.
Forward-Looking Statements
This communication contains forward-looking statements within the meaning of Section 27A of the
Use of Non-IFRS Financial Measures
This press release and accompanying tables contain certain non-IFRS financial measures, including adjusted net income and adjusted EBITDA, as supplemental metrics in reviewing and assessing Perfect’s operating performance and formulating its business plan. Perfect defined these non-IFRS financial measures as follows:
Adjusted net income is defined as net income (loss) excluding one-off transaction costs (e.g. costs related to de-SPAC transaction), non-cash equity-based compensation, non-cash evaluation (gain)/loss of preferred shares, and foreign exchange (gain)/loss. For a reconciliation of adjusted net income to net income (loss), see the reconciliation table included elsewhere in this press release.
Adjusted EBITDA is defined as net income (loss) excluding depreciation and amortization expense, income tax expense, interest and finance costs, one-off transaction costs (e.g. costs related to de-SPAC transaction), non-cash equity-based compensation, non-cash evaluation (gain)/loss of preferred shares, and foreign exchange (gain)/loss. For a reconciliation of adjusted EBITDA to net income (loss), see the reconciliation table included elsewhere in this press release.
Non-IFRS financial measures are not defined under IFRS and are not presented in accordance with IFRS. Non-IFRS financial measures have limitations as analytical tools, which possibly do not reflect all items of expense that affect our operations. Share-based compensation expenses have been and may continue to be incurred in our business and are not reflected in the presentation of the non-IFRS financial measures. In addition, the non-IFRS financial measures Perfect uses may differ from the non-IFRS measures used by other companies, including peer companies, and therefore their comparability may be limited. The presentation of these non-IFRS financial measures is not intended to be considered in isolation from or as a substitute for the financial information prepared and presented in accordance with IFRS. The items excluded from our adjusted net income and adjusted EBITDA are not driven by core results of operations and render comparison of IFRS financial measures with prior periods less meaningful. We believe adjusted net income and adjusted EBITDA provide useful information to investors and others in understanding and evaluating our results of operations, as well as providing a useful measure for period-to-period comparisons of our business performance. Moreover, such non-IFRS measures are used by our management internally to make operating decisions, including those related to operating expenses, evaluate performance, and perform strategic planning and annual budgeting.
PERFECT CORP. AND SUBSIDIARIES |
||||||
UNAUDITED CONSOLIDATED BALANCE SHEETS |
||||||
|
||||||
(Expressed in thousands of |
||||||
|
December 31, 2021 |
September 30, 2022 |
||||
Assets |
AMOUNT |
AMOUNT |
||||
Current assets |
|
|
||||
Cash and cash equivalents |
$ |
80,453 |
$ |
84,014 |
||
Accounts receivable, net |
|
6,568 |
|
7,431 |
||
Current contract assets |
|
- |
|
3,404 |
||
Other receivables |
|
6 |
|
95 |
||
Other receivables - related parties |
|
- |
|
14 |
||
Current income tax assets |
|
63 |
|
69 |
||
Inventories |
|
88 |
|
50 |
||
Other current assets |
|
299 |
|
414 |
||
Total current assets |
|
87,477 |
|
95,491 |
||
Non-current assets |
|
|
||||
Property, plant and equipment |
|
407 |
|
316 |
||
Right-of-use assets |
|
620 |
|
422 |
||
Intangible assets |
|
100 |
|
100 |
||
Deferred income tax assets |
|
165 |
|
132 |
||
Guarantee deposits paid |
|
135 |
|
123 |
||
Total non-current assets |
|
1,427 |
|
1,093 |
||
Total assets |
$ |
88,904 |
$ |
96,584 |
||
PERFECT CORP. AND SUBSIDIARIES |
||||||||
UNAUDITED CONSOLIDATED BALANCE SHEETS |
||||||||
|
||||||||
(Expressed in thousands of |
||||||||
|
|
|
||||||
Liabilities and Equity |
AMOUNT |
AMOUNT |
||||||
Current liabilities |
|
|
|
|
||||
Current contract liabilities |
$ |
9,021 |
|
$ |
11,346 |
|
||
Other payables |
|
8,706 |
|
|
8,639 |
|
||
Other payables - related parties |
|
73 |
|
|
49 |
|
||
Current tax liabilities |
|
104 |
|
|
98 |
|
||
Current provisions |
|
1,058 |
|
|
1,649 |
|
||
Current lease liabilities |
|
449 |
|
|
295 |
|
||
Other current liabilities |
|
384 |
|
|
121 |
|
||
Total current liabilities |
|
19,795 |
|
|
22,197 |
|
||
Non-current liabilities |
|
|
|
|
||||
Non-current financial liabilities at fair value through profit or loss |
|
259,230 |
|
|
230,863 |
|
||
Non-current lease liabilities |
|
189 |
|
|
131 |
|
||
Net defined benefit liability, non-current |
|
104 |
|
|
91 |
|
||
Guarantee deposits received |
|
28 |
|
|
24 |
|
||
Total non-current liabilities |
|
259,551 |
|
|
231,109 |
|
||
Total liabilities |
|
279,346 |
|
|
253,306 |
|
||
Equity |
|
|
|
|
||||
Common stock |
|
30,152 |
|
|
32,815 |
|
||
Capital surplus |
|
2,871 |
|
|
7,380 |
|
||
Accumulated deficit |
( |
224,097 |
) |
( |
195,589 |
) |
||
Other equity interest |
|
632 |
|
( |
1,328 |
) |
||
Total equity |
( |
190,442 |
) |
( |
156,722 |
) |
||
Total liabilities and equity |
$ |
88,904 |
|
$ |
96,584 |
|
||
PERFECT CORP. AND SUBSIDIARIES |
||||||||
UNAUDTIED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME |
||||||||
FOR THE NINE MONTHS ENDED |
||||||||
(Expressed in thousands of |
||||||||
|
|
Nine months ended |
||||||
|
|
2021 |
|
2022 |
||||
Items |
|
AMOUNT |
|
AMOUNT |
||||
Revenue |
|
$ |
29,681 |
|
|
$ |
36,229 |
|
Costs of sales and services |
( |
4,054 |
) |
( |
5,168 |
) |
||
Gross profit |
|
|
25,627 |
|
|
|
31,061 |
|
Operating expenses |
|
|
|
|
|
|
||
Sales and marketing expenses |
( |
17,829 |
) |
( |
18,228 |
) |
||
General and administrative expenses |
( |
2,628 |
) |
( |
7,177 |
) |
||
Research and development expenses |
( |
6,343 |
) |
( |
7,910 |
) |
||
Total operating expenses |
( |
26,800 |
) |
( |
33,315 |
) |
||
Operating profit (loss) |
( |
1,173 |
) |
( |
2,254 |
) |
||
Non-operating income and expenses |
|
|
|
|
|
|
||
Interest income |
|
|
98 |
|
|
|
620 |
|
Other income |
|
|
12 |
|
|
|
12 |
|
Other gains and losses |
( |
1,794 |
) |
|
|
30,337 |
|
|
Finance costs |
( |
6 |
) |
( |
6 |
) |
||
Total non-operating income and expenses |
( |
1,690 |
) |
|
|
30,963 |
|
|
Income (loss) before income tax |
( |
2,863 |
) |
|
|
28,709 |
|
|
Income tax expense |
( |
215 |
) |
( |
201 |
) |
||
Net income (loss) |
($ |
3,078 |
) |
|
$ |
28,508 |
|
|
Other comprehensive income |
|
|
|
|
|
|
||
Components of other comprehensive income that will not be reclassified to profit or loss |
|
|
|
|
|
|
||
Credit risk changes in financial instrument-Preference shares |
|
$ |
- |
|
($ |
7 |
) |
|
Components of other comprehensive income that will be reclassified to profit or loss |
|
|
|
|
|
|
||
Exchange differences arising on translation of foreign operations |
|
|
92 |
|
( |
1,953 |
) |
|
Other comprehensive income, net |
|
$ |
92 |
|
($ |
1,960 |
) |
|
Total comprehensive income (loss) |
($ |
2,986 |
) |
|
$ |
26,548 |
|
|
Net income (loss), attributable to: |
|
|
|
|
|
|
||
Shareholders of the parent |
($ |
3,078 |
) |
|
$ |
28,508 |
|
|
Total comprehensive income (loss) attributable to: |
|
|
|
|
|
|
||
Shareholders of the parent |
($ |
2,986 |
) |
|
$ |
26,548 |
|
|
PERFECT CORP. AND SUBSIDIARIES |
||||||||
UNAUDITED RECONCILIATION OF NON-IFRS FINANCIAL MEASURES – ADJUSTED NET INCOME (LOSS) CALCULATION |
||||||||
FOR THE NINE MONTHS ENDED |
||||||||
(Expressed in thousands of |
||||||||
|
|
Nine months ended |
||||||
|
|
2021 |
|
2022 |
||||
Items |
|
AMOUNT |
|
AMOUNT |
||||
Net Income (Loss) |
($ |
3,078 |
) |
|
$ |
28,508 |
|
|
One-off Transaction Costs |
|
|
521 |
|
|
|
4,316 |
|
Non-Cash Equity-Based Compensation |
|
|
139 |
|
|
|
1,580 |
|
Non-Cash Evaluation (Gain)/Loss of Preferred Shares |
|
|
1,129 |
|
( |
28,375 |
) |
|
Foreign Exchange (Gain)/Loss |
|
|
665 |
|
( |
1,962 |
) |
|
Adjusted Net Income (Loss) |
($ |
624 |
) |
|
$ |
4,067 |
|
|
|
|
|
|
|
|
|
PERFECT CORP. AND SUBSIDIARIES |
||||||||
UNAUDITED RECONCILIATION OF NON-IFRS FINANCIAL MEASURES – ADJUSTED EBITDA CALCULATION |
||||||||
FOR THE NINE MONTHS ENDED |
||||||||
(Expressed in thousands of |
||||||||
|
|
Nine months ended |
||||||
|
|
2021 |
|
2022 |
||||
Items |
|
AMOUNT |
|
AMOUNT |
||||
Net Income (Loss) |
($ |
3,078 |
) |
|
$ |
28,508 |
|
|
Depreciation and Amortization Expense |
|
|
473 |
|
|
|
582 |
|
Income Tax Expense |
|
|
215 |
|
|
|
201 |
|
Interest and Finance costs |
( |
91 |
) |
( |
614 |
) |
||
One-off Transaction Costs |
|
|
521 |
|
|
|
4,316 |
|
Non-Cash Equity-Based Compensation |
|
|
139 |
|
|
|
1,580 |
|
Non-Cash Evaluation (Gain)/Loss of Preferred Shares |
|
|
1,129 |
|
( |
28,375 |
) |
|
Foreign Exchange (Gain)/Loss |
|
|
665 |
|
( |
1,962 |
) |
|
Adjusted EBITDA |
($ |
27 |
) |
|
$ |
4,236 |
|
|
|
|
|
|
|
|
|
_____________________________
1 Adjusted net income is a non-IFRS financial measure. See the “Use of Non-IFRS Financial Measures” section of this communication for the definition of such non-IFRS measure.
2 Adjusted EBITDA is a non-IFRS financial measure. See the “Use of Non-IFRS Financial Measures” section of this communication for the definition of such non-IFRS measure.
3 Key Customers refers to the Company’s brand customers who contributed revenue of more than
4 Monthly active subscribers refer to paying users who subscribes to the Company’s mobile apps’ premium functions and maintain an active subscription at the end of the measured month.
5 “Business Combination Projections” refer to the projections under the section titled “Certain Projected Financial Information” in Amendment No. 6 to the Company’s registration statement on Form F-4, as filed with the
View source version on businesswire.com: https://www.businesswire.com/news/home/20221130005427/en/
Investor Relations
Email: Investor_Relations@PerfectCorp.com
Phone: +1 (646) 880 9057
Category: Investor Relations
Source:
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