In the three-months ending April 30, 2021, the Company has further increased its penetration in the financial institution market in the U.S. with the addition of 42 new clients (106 for fiscal year 2021), representing 112 (233 for fiscal year 2021) locations. Exchange Bank of Canada continued its growth in the international payments segment in Canada, initiating trades with 210 new corporate clients, enabling it to more than double its payment revenue over the same quarter in the prior year. The Company increased its penetration in the global banknote market with the addition of a European-based financial institution client.
Corporate and Operational Highlights: Story continues
Since April 30, 2020, the Company has added 768 new customer relationships comprising 1,196 locations, of which 274 relationships representing 608 locations were added in the U.S. and 494 relationships representing 588 locations were added in Canada. Approximately one-half of the new customer relationships in Canada were added pursuant to the business acquisition completed on July 29, 2020 as announced on June 30, 2020. Randolph Pinna, CEO of the Company, stated, “Q2 marked a milestone in the pandemic for the Company. CXI’s trailing twelve-month revenue was higher in Q2 than in the previous quarter ended January 31, 2021. This inflection point also coincided in the same quarter that saw the group’s consolidated net revenue being higher than it was in the comparative period a year ago. While the improvement is seemingly small relative to CXI’s pre-pandemic revenue, it is important to note that it is mostly not as a result of a recovery in travel and tourism based demand for foreign currencies, but rather due to the execution of our strategic plan and the diligent effort by our employees to diversify our revenue base while becoming more efficient in process and cost control. Significant progress has been made in growing our international payments business, as well as strengthening our position in the global banknote trade. While we continue to pursue this strategy, we are optimistic that we are now on the precipice of a recovery in international travel. There are tangible indicators that the vaccines have proven effective at combatting the coronavirus, allowing some countries to relax regulations that restrict global mobility. The European Union is now opening up travel to vaccinated travelers and we anticipate that the border between Canada and the U.S. is likely to re-open sometime this summer. We are taking a conservative approach in our expectations on the recovery as it pertains to revenue and maintain a focus on returning to profitability.”
A net operating loss of $0.6 million in the three-month period ended April 30, 2021 compared to $2.3 million in net operating income for the three-month period ended April 30, 2020. Operating expenses declined by 17%, in part due to previous restructuring actions and other cost reduction efforts that have mitigated a significant amount of the revenue decline; Other income included $0.5 million from government grants for the three-month period ended April 30, 2021; Revenue increased 4% or $0.3 million to $6.6 million for the three-month period ended April 30, 2021. This represents an inflection point for the Company, as the revenue in the prior year period included revenue prior to the declaration of the COVID-19 pandemic on March 11, 2020. While revenue between the two periods is relatively consistent, the operating expenses as a percentage of revenue has improved, demonstrating progression towards the Company’s goal of returning to positive operating leverage. This reflects the positive impact from the restructuring actions taken in 2020 to re-size the business;
Financial Highlights for the Three-month Period Ended April 30, 2021 compared to the Three-month Period Ended April 30, 2020: The Company had a net negative operating cash flow, excluding the impact of working capital changes in the quarter of approximately $0.5 million, or $0.2 million per month, which indicates a progressive reduction in operating cash outflow since October 31, 2020. The liquidity position is strong with $54M in unrestricted cash.
The News Highlights
- Currency Exchange International announces financial results for the three-month period ended April 30, 2021 and adoption of notice statute
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