VICTORIA, BRITISH COLUMBIA – August 27, 2021 – Plurilock Security Inc. (TSXV: PLUR) (OTCQB: PLCKF) and related subsidiaries (“Plurilock” or the “Company”), an identity-centric cybersecurity solution provider for workforces, today announces its financial results for the six months ended June 30, 2021. All dollar figures are stated in Canadian dollars, unless otherwise indicated.
“We are very pleased to report the second quarter of 2021 saw us deliver strong year over year revenue growth, add industry leading professionals to the organization, and expand our operational presence to new markets globally,” said Ian L. Paterson, CEO of Plurilock. “The growth exhibited provides further validation that enterprise customers look to Plurilock for a partner that delivers simple, reliable, industry leading cybersecurity solutions to some of the world’s leading organizations.”
“As part of our stated strategy of acquiring assets to complement our existing authentication products, we completed our first acquisition of cybersecurity solutions provider Aurora Systems Consulting Inc.,” continued Mr. Paterson. “With Aurora, we have secured a channel partner with an experienced sales force and over 140 government and commercial customers to offer our high margin software. As well, we have seen success of our sales strategy with our recent $672,000 multi-year purchase order of DEFEND continuous authentication product by a leading overseas financial institution.”
Following a series of high-profile cyber attacks, discussions on cybersecurity infrastructure and investment have been top of mind for governmental and private-sector organizations. Last week, the White House administration met with leaders from several technology companies for a cybersecurity summit.1 Subsequently, big names in technology including Google and Microsoft have since announced planned multi-billion dollar investments in new industry standards, stronger security tools, and skills training to prevent and mitigate attacks.2
Second Quarter Fiscal 2021 Financial Highlights
- Total revenue for the three and six months ended June 30, 2021, was $8,604,310 and $8,680,071 respectively ($79,512 and $182,851 over the same periods in the prior fiscal year). The increase in revenue is due to the acquisition of Aurora Systems Consulting Inc. (“Aurora”) in the Solutions Division.
- Hardware sales revenues accounted for 88.1% and 87.3% for the three and six months ended June 30, 2021, respectively (0% for both the periods in 2020) of total revenues. Electronic software, license and maintenance sales revenues accounted for 8.6% and 9.3% for the three and six months ended June 30, 2021, respectively (100% and 89.4% for the same periods in 2020) of total revenues. Professional services revenue accounted for 3.3% and 3.4% for the three and six months ended June 30, 2021 (0% and 10.6% for the same periods in 2020) of total revenues. Hardware sales revenue was the new revenue stream added to the Company after the acquisition of Aurora.
- Hardware sales revenue was $7,581,208 for both the three and six months ended June 30, 2021, respectively. No revenue was recorded under this category in prior year.
- Electronic software license and maintenance sales revenue was $738,054 and $805,810 for the three and six months ended June 30, 2021, respectively, compared to $79,512 and $163,480 over the same periods in the prior year.
- Professional services sales revenue was $285,048 and $293,053 for the three and six months ended June 30, 2021, respectively, compared to nil and $19,371 over the same periods in the prior year.
- Adjusted EBITDA was $(985,142) and $(2,041,539) for the three and six months ended June 30, 2021, respectively, compared to $(482,375) and $(1,037,749) over the same periods in the prior year.
- Cash & cash equivalents on June 30, 2021, was $4,977,387 compared to $1,721,179 on December 31, 2020.
- Cash used in operating activities for the three and six months ended June 30, 2021 was $418,094 and $1,576,549, compared to $321,435 and $518,543 during the same periods in the prior fiscal year.
Second Quarter Fiscal 2021 Operational Highlights
- On April 13, 2021, Wells Fargo Bank outstanding LOC totalling US$500,000 was repaid in full.
- On April 27, 2021, Aurora’s Paycheck Protection Program (“PPP”) loan obtained from the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) loan including US$199,830 in principal and US$2,053.81 in interest was forgiven.
- On April 27, 2021, Plurilock filed two additional U.S. provisional patent applications for new advancements in continuous authentication technology. The first application documents new techniques for utilizing behavioral biometrics in forensic analysis of insider threats, a key cyber concern for work forces. The second application covers enhancements to Plurilock’s invisible authentication technology, which would broaden the situations in which it can be used while ensuring its robustness in today’s multimodal and increasingly remote work environments.
- On May 9, 2021, the Company filed a preliminary short form base shelf prospectus (the “Prospectus”) with securities regulators in each of the provinces and territories of Canada, other than Québec. The Prospectus, when made final and effective, will enable Plurilock to offer, issue and sell up to $50 million of common shares, warrants, subscription receipts, debt securities and units or a combination thereof from time to time, separately or together, in amounts, at prices and on terms to be determined based on market conditions at the time of the offering and as set out in an accompanying prospectus supplement, during the 25-month period that the Prospectus, when made final, remain valid.
- On June 28, 2021, the Company released a new Splunk® SIEM application for its DEFEND continuous authentication product.
- On June 29, 2021, the Company added retired U.S. Navy vice-admiral Jan E. Tighe to its advisory board, who currently serves as an independent director on the board of Goldman Sachs.
- During Q2 2021 the Company announced US$3,319,000 of new orders and contracts which included a US$1.15 million order with the U.S. Department of the Navy under National Aeronautics and Space Administration’s (“NASA”) Solution for Enterprise-Wide Procurement (“SEWP”), United States Government-Wide Acquisition Contract Vehicle (“GWAC”) that was announced on May 7, 2021.
Summary of Key Financial Metrics
This news release presents information about EBITDA and Adjusted EBITDA, both of which are non-IFRS financial measures, to provide supplementary information about operating performance. Plurilock defines EBITDA as net income or loss before interest, income taxes, depreciation and amortization. Adjusted EBITDA removes non-cash share-based compensation and listing expenses from EBITDA. The Company believes that EBITDA and Adjusted EBITDA is a meaningful financial metric for investors as it adjusts income to reflect amounts which the Company can use to fund working capital requirements, service future interest and principal debt repayments and fund future growth initiatives. EBITDA and Adjusted EBITDA are not intended as a substitute for IFRS measures. A limitation of utilizing these non-IFRS measures is that the IFRS accounting effects of the adjustments do in fact reflect the underlying financial results of Plurilock’s business and these effects should not be ignored in evaluating and analyzing Plurilock’s financial results. Therefore, management believes that Plurilock’s IFRS measures of net loss and the same respective non-IFRS measure should be considered together. Non-IFRS measures do not have any standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Readers should refer to the Company’s most recently filed MD&A for a more detailed discussion of these measures and their calculation.
Management’s Discussion and Analysis and Interim Condensed Consolidated Financial Statements and the notes thereto for the fiscal period ended June 30, 2021 can be obtained from Plurilock’s corporate website at www.plurilock.com and under Plurilock’s SEDAR profile at www.sedar.com
Plurilock provides identity-centric cybersecurity for today’s workforces. Plurilock offers world-class cybersecurity solutions paired with AI-driven, cloud-friendly security technologies that deliver persistent identity assurance with unmatched ease of use. The Plurilock family of companies enables organizations to operate safely and securely-while reducing cybersecurity friction.
For more information, visit www.plurilock.com or contact:
Ian L. Paterson
Chief Executive Officer
Chief Financial Officer
This press release may contain certain forward-looking statements and forward-looking information (collectively, “forward-looking statements”) which relate to future events or Plurilock’s future business, operations, and financial performance and condition. Forward-looking statements normally contain words like “will”, “intend”, “anticipate”, “could”, “should”, “may”, “might”, “expect”, “estimate”, “forecast”, “plan”, “potential”, “project”, “assume”, “contemplate”, “believe”, “shall”, “scheduled”, and similar terms. Forward-looking statements are not guarantees of future performance, actions, or developments and are based on expectations, assumptions and other factors that management currently believes are relevant, reasonable, and appropriate in the circumstances. Although management believes that the forward-looking statements herein are reasonable, actual results could be substantially different due to the risks and uncertainties associated with and inherent to Plurilock’s business. Additional material risks and uncertainties applicable to the forward-looking statements herein include, without limitation, unforeseen events, developments, or factors causing any of the aforesaid expectations, assumptions, and other factors ultimately being inaccurate or irrelevant. Many of these factors are beyond the control of Plurilock. All forward-looking statements included in this press release are expressly qualified in their entirety by these cautionary statements. The forward-looking statements contained in this press release are made as at the date hereof and Plurilock undertakes no obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required by applicable securities laws.
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