Earnings call transcript Q1 2023

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Operator

Hi, everyone. Thank you for joining us on today’s webinar.

Before we begin, I’d like to announce that we will be referring to today’s earnings release, which was sent to the newswires earlier this afternoon.

I’d also like to remind everyone that this conference call could contain forward-looking statements about Destiny Media Technologies within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based upon current beliefs and expectations of management and are subject to risks and uncertainties, which could cause actual results to differ materially from those forward-looking statements. in discussed and company’s assume the to information fully SEC with any are update SEDAR and company contained risks in filings the the obligation Such call. this does not

the financial should be financial we of webinar, and The the or GAAP company’s the of from other a with read in supplemental non-GAAP measures financial The press presentation financial in and discuss During information isolation statements conjunction by earnings accordance with measures should filed with of found GAAP the comparable presented not release. reconciliation will differ are non-GAAP the and non-GAAP can the substitute be SEC financial may the prepared in similarly SEDAR. presented in A financial in superior used certain be measures. to titled measures measures non-GAAP considered financial disclosures to in as measures companies. the or most company’s the

that, to Executive Officer. would With Chief [Operator like Vandenberg, call turn over your Fred Instructions] I to host, the

Fred Vandenberg

Thanks, summary results and about we revenue take Fred development to briefly Benedict, driver the And business talk and Allan will I and operations business have leads quarter efforts. marketing you Today, Rebecca. our afternoon, Vandenberg, who will development to I then turn through myself, for and Good the financial Allan of everybody. teams. over discussions. some it

turn to over at Allan And conversation what to We about growth. back form are end done did – narrative we similar to a follow he business Allan things development, when we and myself the that’s to then modification slight how forward. will on the just it going format a to talk with looking year has simplification on

starting in bit fell – quarter quarter. a It value there little quarter, sorry, hard is hit the us It’s majority the the come the this decline for end revenue back XX%. the to towards The a of I the there. of the slide by of decline For – euro. missed

think The that COVID secondarily independent out more. We of function a on that generally. bit funding will post-pandemic. with artists But Allan is government this little a smaller that running impacted revenue from sales I think touch fell associated

our We side, adjusting EBITDA really of on this sign up of is positive is is growing strength quarter X% both is we margin. This Universal EBITDA the $XXX,XXX, after label globally. growth for major are about revenue solid the Warner and XX% think On the with value that FX. providing. the for a net

to $XXX,XXX of want which is new software quarter. really services was capitalization and for it long-term – These this value. costs, provide will I here think thing mention the are additional developing is one and products we we development about Now for that the are

Play services. the previous XX% overall quarter. MPE growth by favorable core really similarly part up up because We $XXX,XXX, to in Income The and in expenditures of declined FX. for new with are was investing platform XX% from have

you that’s component solely, costs. are far by look the salary wages at our and largest and down If of P&L XX%

affecting comes U.S. which dollar, to revenue. it is impacting the When to the that down costs. is FX. of Some FX, our relative relative Canadian our U.S. favorable the to dollar higher is is euro dollar Similarly, disclosed

is back and down So the salary wages going for quarter. XX%

spending return. a just are we trying are cutting to where FX, get not we Some make its sure costs we staffing, some of here, we that’s lower of are

a salaries This There and in it will associated reductions were staffing. and with we are sales thing salaries if this making is software Overall, significant costs, And product you were new development is capitalized costs. I wages products X%. people in lightly. real and touch is noticed drop have I think wages. in investment One because up development include again, generally. the and marketing on

little As development product FX is and as before, I is there there well. described lot the bit movement impact resources of a to over a but of

plus expenditures actually that’s overall is the that’s capitalized down all investments So X%, P&L just items. including

admin business to from within as that make and is over influence recently, to a to to more global it’s are It’s features for or But influence Recently, These to at ability we they or PC few impact heavily that’s really to focused don’t have Universal, platform. it platform platform. web-based really platform recent say. The the easy that features use. platform can development heavily moving growth the to that – past grow in Universal. And based new we facilitate services I admin here our by something the platform difference changes, a years, something building think development our on product things product grow. within have is makers adding improvements, ability really can our I really that then, the out – development grow were can least really that We discussed would global directly. the products over grow development or really is ability things something by

metaphor, are about office or QX. quarter And are the to like has draw you FedEx grow. the talk this package. main But simplified grow that at about four or our components. main think really works things and do it platform really to I it about us And to I want things, is influence way. releases, it talk The from describe how it’s the what going our platform past ability look at as these MPE, if and into to how and refer releases the platform will a to post I Play will – a something I if three and with wanted itself When look we think talked that think can in is, of to we you you went a very to you

you will packages then drive to, more package more similarly, up revenue we the get. revenue. send the send, the you destinations will that So more we And

FedEx, be is But might delivery. down doesn’t, breaks bit. The maybe it is it’s the the little effectiveness it bigger comes it this gets like that where receipts With third perfect overall value-added component other it the either enhance things that things Play one, or really we But has can really just or of not insurance it’s a metaphor where something the impact end or when on that MPE there, there. a to has where or probably read something. add it the

what is our on, little So I can are wanted discussing revenue of to working bit a what components, how we these these do influence how components time things growth. spend

archived really bit that sign their and That’s conversion, of checkout in there that new these are a a and a pay. more more money we recipient source more you product – best mouth automation, that’s in do they that, but technical MPE. sales can programmer will that for in request. growth releases, in here, of it’s manner. those, The we – from really something to more that things like a feature now. our want added release we platform similar list, do I song content will the way detail from that artist this to year ability a last not this really without our actually depth. to is leads. and – reinforces of a – if The that send are other want on, the think and the don’t request into Lead are right current But it but a an can We and things Allan a markets, here. and of then bit or like year sourced where word Play The they added it talk bulk are bottleneck same to a structure we reporting, There send certain that artists And here. that get now, helping We distributions. content we bunch amount in artist of That’s communication, – recipient-sourced generate way these like is a But growth to then things you you where improving requests. to a right reporting, lead about tell things a getting more our don’t through in first us do more is or sale. it self customer amount have prepare do the want – again spend recipient improve select get tremendous first the things really section, it’s a checkout, that in there can that’s of content you signup an currently little of a you

and resending from retention more artist or that or content improves that thing. of resending client sort that So, same

stool, of about In this will we the destinations. second talk leg

bottleneck list. if we great. also that that by expand frankly, can that our spend distributions Now, the are we this think facilitate can This expand far, want on technical lists. lists accurate. on, critical provide a things certain technical end, providing the we a And ones our is that’s really list the we at we are majority that we a of They platform, time quite – know of of faster for. much to. mentioned our in revenue. independent something on we that at lot are we because the that’s times solutions is to sales. not within I work updated. are recipients, within And recipient but Recipient But our list don’t by Play platform. they are And more list recipient our that that’s our offering our They here – know year MPE parts the just I because most solution are they it The base recipient lists, distributions expensive will and lot customers send our of base there least think growth. the can lists is we to is to are a have to who They bit using we who world expand And any important. where use competitor biggest don’t it’s the recipients have grow our are and recipient And current. a the

improvements. there list is in selection Also

So, It’s are They on few select select particularly the sending list. to already easy our in making not there Right who easy. now, we been an to is of lists. easier you have a to we tell those working things international that it’s lists descriptions not platform.

to it. have through If distribution, example, hunt search got a you and you country for

designed just have – We improvement we an are there. in

We have Last it build yet. out quarter, mentioned international we got to lists.

providing for larger of those keep I you things, generate content can we have That’s distributions. like within music. those We lists is like there – sort building feedback of thing. international am that Recipient the certain genres feedback requesting can to think people started platform out. We use

a something the more it That’s sending reports. expansion consider to want doing release list broadly you where if maybe is Automated around well, world.

doing for process we We have reports. talk things department then – to that report lie. that. those once follow-up, Universal, efficiencies automate It’s management just generated for is manual services, we list but administration it they generated global management And then list lists. that manage the that’s about help a sales is more really functions services would already is our this becomes where really Value-added this can when

most part, there For enhance do distributions but the things little we bit clients of the is lots that will that’s well. for can smaller a here oversimplification, as

by is you mean for distribution the piece and what here. It’s one-off of I is like. quickly I And you more Share a want share kind piece receive standing of think quickly. sounds it next share are mention player really aren’t. Right an Quick exactly what that content of software e-mails to if e-mails somebody to they it’s it. a a content, Share ability can see and is the just we the sending like to I that Quick translated, now, will And languages. only but International

we – in probably week have for that. starting are We beta next well,

are the think re-enhance internally and right who revenue that it platform We that’s want people to just some to provide is. testing as now. going for incremental do We it then

within leave up because what’s working of and obvious on think lot spending a little probably are of that’s tremendous it improvements. but a that will are I development. things a is more I on. bit things we are see that these is there why there, And And platform amount we product it’s that just longwinded, can you more

We of kind have focusing self-signup, self-checkout. – we on in the are

to more signup sending, So that that’s getting making to ability then more it easier customers send an customers easier those and recipients. to for with

main change And product of a made sort restructure the to faster thrusts is two we development deliver there. to have in group it. our this So

to way able priority. we the think and things. to we are faster Basically, So are be we in going focusing focusing to on basically on deliver in the updates cash generating revenue right quickest

Allan. turn that, With it over will I

Allan Benedict

afternoon, Year. Good Happy Fred. everyone. Thanks, New

territory strategies independent wanted similar on touched into the a revenue updates things in Before expand Fred wider that for market I like I Canada, get on and earlier. bit the Latin to

client a independent part is these we major look of three of that any at one So revenue generally, systems. label isn’t

independent up contents size from understand. me Universal, revenue or or everyone covers either some extra labels helpful to Warner. this artists the Sony this affiliated aren’t that’s to So, Due really context is on any of with excuse – essentially classification, to that there

in very Going artists exclusively has this And this and very one almost that, shows is operations, clinical somewhat decline The level. granular artists through and is put from very industry few for seen at quarters took releases very, and the that or client music it. after-effect during not or their with the level have the the Fred these label they decline one small on independent on change consistently or revenue hit a our firms the of very such as through weekly an agency rosters. management artists biweekly with or with monthly mentioned, been clients a labels that small operations sometimes reason how promotion as pandemic

last time some all grants artists federal been funding relief Over through in half, things to a other territories first funding in And situations. year amount U.S. a been year, the PPP some has as in large there loans as and the available of for has such well. of that the

before. new budget to or supervision spend out they or reallocated So pivot either to while was contents revenue much like had able could Essentially generate them, music radio they and any often wide hadn’t weren’t past the was marketing artists something to which going sent that out of had road they avenue tour or that to for their creating this on press from that that. or contents

in artists these had So past. spend than essentially more the to ever

quite have few this. a of We seen examples

of team. company and took October Similarly, federal to globally it internationally artists September, of year the declined management a management federal who a artists and spend per territory usual it their last operations needed in of in it’s They and other $XX,XXX. of put all budget nearly really that For company artists decided pass one to content call funding to and instance, a year sudden their I prior. more had send one out resulted that in single within to from home territory, their this the as of and their small additional programs fall, coming kind dwindling, release opposed and become budget bit in funding past release artists those the keeping spend some without many conscious total many

logical funding question that am of up, kind case That’s to I next smaller touring revenue the would the world the these as but the And have opened exactly the replaced up as well slowed, funding. sure not artists. began as with then open

or the tour either the them. just opportunities for shutdown pandemic so many given coming following were So with of with they the out behind a the behind to venues touring when and long, of them support as larger reopened, agencies more artists team

they into have funding ran did tours that also a but during additional bit of where hoping the the the are they for. independence almost couldn’t catch-XX, didn’t a book pandemic, that they So

trouble XXXX we speaking touring partners instance, had or the in began cancel Australia than this of territory. international to and have the almost our to had and tours XXXX opportunities in other given securing been hit For independents routings. open acts more there when Many were borders the any to that Australia to early these

they they released and much album lighter some releases for this that effect their schedule roster rosters cycle after content content past new and in while even year we larger norm are Another the new record numerous with discussed fall labels, we fewer just now And XXXX. return We as a next. for this will clients and was of had essentially kind very general see we COVID of our labels that with of of saw shortly. are confident off teams, to early larger release very

improve individual advances internally as those well as made We will have we revenue clients. also believe label that artists from

that also roughly was more we value demo and their in never least And months the on to in key optimized, some increase head it obviously January conversions sure we fiscal coming to still requesting ahead due have the away these we two the team. Plan XX%, it’s on we already Lag begin we with and Xst. it site are in to artists. around the nearly sales a done, these artists and sure lead the basically compared the up gave just been B information to month website it’s with for ground have things conversion and down XX% XX% But greater, far kind so of of the point appears up trying to November at time a process planning and generated with a is detail launched last easier for and line, requesting half actually their alone, everything from our optimization process to the new One with it’s to leads offers. a and advances month getting that process, and making seen we they or like sometimes last to old flow maybe increase of the the that January. Lead go. just We the plan onboarding and from to this new that in smoother out website the other quarter up pick compared of flow has more making from stripped marketing prop publicly getting the redesigned as website saw through or

business short to which the development the And prolonged team staffed of process. holidays, over contributed have us did a slightly the of a which end onboarding in towards team, bit situation also depart the October, put a member we

have week, our staffed right of in made we again foresee reasons. don’t the our touch fully a will as we forward as moving are priorities issue And sure have this number and that moving place team goals We this an since on. that and forward for we for of – see Fred

I automation them of One in response we the well. that think as touched being lead new have calls on past

we it dig and was that fully this past our designed really and So, process. optimize try December, automation, to to launched it onboarding in

information initial the somewhat glass Plan they artists concisely teams a independent small of for goes. This contact conversion know synergy and and there conversation their so development both the complicated everything between delivered and We our process teams been hopefully B the is that the and clearly And as excited business is business future. to what further sure took even make collaboration for mean kind to we very very understand, that are it can a advances operations from that and need we some magnifying team. our to has for

and some list specific growing so or know we this year as sector, in versions have into previous outlet efforts a last the Digging quarters growing presence from recipient our offerings South greater majority Latin of Central in target our territories providing and previous The looking distribution call, America lists spent you the market. to to been clients and of and Latin territories. the around and those

Now, as lists in built of late we XX operational last year. territories have

how grow It’s partners and vice a strategic the finding and content in we of catalogue on the through be I numbers the business of on do activity We we recipients. territories same Fred focusing our in these without calls. egg short, our thus the new little in release this know are has process expanded from past. bit increased content chicken going growing at gone new get activity past we of into versa. a to have encourage and much key way that But to in efforts territories look

artists login you always there the get content the to users achieve, compare This with we the if list So, trying and adds we rates sure more into making when is it and for value labels also value to activity can first higher the market. areas time. start for new strategy

also forward some and best crossover believe music the path its market. only to compared industry Latin is industry a is a a in bit slightly to other sophisticated of the there U.S. focusing We territories and Mexico between connection size Mexican more on not but the region, and due the

seen then Mexico like Argentina success progress that and tent-pole Kind are encourage as in user we the in then wanted in here that. Given to use other of that of territories like greater expand Colombia confident well, countries well. stable review having Mexico other to such I size Canada. and have as also the will and we

diminishing Canada Canadian our year. within seen know, revenue you commercially our began their to was in the same small the into. and labels other to many it Prior have any there. artists artists hurdles funding, mid other discussed the other artists things that These were we charging by be charging progress in mainly As And of are last to we earlier, late global we commercially country, I exporting hit any lists. territory same whether releases that in going would touring,

independent specific sector saw has hurdles that the to these contributed decline artists this in Canada So, in we quarter.

substantial well and outlook. promoters crafts Similarly, we as most paints forward, independent we with increases deeper past a such much colors moving and as key more such agencies. arts as And saw positive independent consistent flying digging from [indiscernible]. now to promotion both independent well-respected partnerships on revenue labels, these as large focused we this efforts, are quarter, longstanding through and labels approaching Mexico and how some company of the Canadian in releases clients, Canadian one However,

other additional partners. some And key – having to to some expect on also calls discussions successes as with well. about continuing there we talk are have ongoing future We more

the the Speaking to back to I Fred with hand over path that, it discuss future, moving forward. will

Fred, are I think mute. you on

Fred Vandenberg

you. Thank

a really is growth. us way have accelerate forward, I product Looking important as so to earlier, development, I revenue said for think

the those. be that few we where two about are We are to are We of both short-term did in growing to recipients deliver. are to developing we a main the around. and in Those customers, that really starting in on on see things then drivers growing press terms the releases growth users, going talked expecting our have focusing and we product

second really being Share, and Quick the then first new product. The a is

We that’s little before have talked a about and monitoring. radio bit

are – challenge through have just a working there. something, missing high we of are we working through – areas moving then some detections are are and in challenges, We we contextually where just plan our to To change business that to do launch of and made things, that. department a producing we on on working I are at be how quicker things technical all they a we a forward. But couple these internally, again, that’s cadence. we are And expect technical have

will With to it turn that, I over questions.

Operator

Allan. and Fred Thanks

So, [Operator written chat yes, touch It Q&A want now we you do will we begin that our one that the one. like Instructions] looks questions-and-answer session. have into to on was if guys

Fred Vandenberg

up would prefer hand if can than verbally, so reading it’s them, of us rather easier top and a Sure. their to else actually keep people question everyone those see ask for the I question. on put

essentially of And think last Well, negotiate question that know revenue global global first I capabilities, a flat the covers Xst, is received platform their approach XX% the year. April by X.X%. but their is by done, we last of think price And we were have all was specific don’t increases. we all with is agreement we from function X.X% on means increase, of of just in that Universal’s that and have growing really for is We they reasons, that agreement And custom The that growing just much effective growing global their increase? use at use. of use. covers a just than really it of what higher XX% – platform. I use, year. recognition way the that They issue. are the Universal How all development revenue agreed are We that’s price Group grew fees monthly their increase,

second year of X, that agreement I XXXX. think April The starts,

we is platform. internally, disclose think active to think start as The metrics complex is about you with a that. relate would to assume gets activities look come question sorts they those about overly them metrics are I activity second within And Activity explaining track releases at which recipients. you activity all to and And do recipients, I distributions, narrative producing revenue. has that how of there we the it I by and and metrics means things it if

Operator

might That be that all we have.

Fred Vandenberg

everyone. Thanks to look forward quarter. We speaking Okay. you next to

Operator

Goodbye.

Destiny Media (DSNY) 17 Jan 232023 Q1 Earnings call transcript