EMERGE Commerce (ECOM) Q4 2024 earnings summary

Executive summary

• Achieved three consecutive quarters of organic revenue growth, returning to annual growth in 2024, and improved profitability with positive net income in Q4.

• Streamlined operations by focusing on grocery and golf segments, divesting non-core assets, and reducing net debt from ~$32M to ~$5M by year-end 2024.

• Cash balance increased to over $3M at year-end 2024 without a capital raise.

• Completed the accretive acquisition of Tee 2 Green in April 2025, expected to enhance revenue, profitability, and cash flow starting Q2 2025.

• Positive adjusted EBITDA and net income are expected for 2025, with continued focus on cash flow and profitability.

Financial highlights

• 2024 revenue grew to CAD 20.4M from CAD 19.6M; pro forma revenue including Tee 2 Green reached $25M (unaudited).

• Q4 revenue (ex-Carnivore Club) up 15% year-over-year to CAD 5.3M; Q4 gross profit rose to CAD 2.2M.

• Net loss for 2024 was CAD 0.5M, a significant improvement from CAD 21M loss in 2023; Q4 net income was CAD 0.3M.

• Adjusted EBITDA loss improved to CAD 466K from CAD 1.8M in 2023; Q4 adjusted EBITDA nearly break-even at CAD 11K loss.

• Cash on hand at year-end was CAD 3.1M, up from CAD 2.5M.

Outlook and guidance

• Management expects cost savings and operational efficiencies to further improve profitability in 2025.

• Addition of Tee 2 Green is projected to substantially enhance revenue, profitability, and cash flow starting Q2 2025.

• Priorities for 2025: accelerate revenue growth, drive operational efficiencies, reduce interest expense, and resume accretive M&A.

• Multiple acquisition candidates identified, with a buyer-friendly market and flexible terms.

• Discount golf vertical expected to benefit from recession-friendly business model and macroeconomic trends.