Mr. Grant Schuetrumpf reports
YANGAROO ANNOUNCES Q2 2024 FINANCIAL RESULTS
Yangaroo Inc. has released its financial results for the second quarter (Q2) ended June 30, 2024. The second quarter financial statements and corresponding management's discussion and analysis are available on the company's website and on SEDAR+. Please note that all currency in this news release is denominated in U.S. dollars, unless otherwise noted.
The company made significant advancements in the second quarter of 2024. Despite a decline in sales volume and revenue, after adjusting for seasonality, the company's operating income has shown considerable improvement compared with the previous year. Net cash flow from operating activities more than tripled, reaching $525,087 in the first six months of 2024, compared with the operating cash flow of $145,446 during the same period last year. This growth is primarily due to increased operating income as management continues to navigate a challenging environment and improve operational efficiency.
For the three months ended June 30, 2024, operating income increased to $110,704 and normalized EBITDA (earnings before interest, taxes, depreciation and amortization) increased to $337,816, up from $17,371 and $237,583, respectively, in Q1 (first quarter) 2024. This improvement is largely attributed to reduced costs in headcount, marketing and technology, though it was offset by higher general and administrative expenses.
The advertising division maintained consistent delivery volumes and sales per customer, with the exception of a decline in advertising delivery from one major direct brand client compared with the prior-year ad delivery volume, offset by new accounts and additional revenue from the Millenia3 acquisition. This major direct brand is a seasonal advertiser, primarily active in the first half of the year, so the impact on the second half of the year is expected to be minimal. The music division's revenue remained flat year over year and is continuing to develop the North American market through an increase in social media marketing, along with conference exhibition and attendance. The awards division saw a slight decline in revenue compared with the same period last year, which is primarily due to the timing of each award show only. The awards division has also now added an additional award show contract in its roster, which is to be completed later this year.
Grant Schuetrumpf, chief executive officer of Yangaroo, commented: "We're excited to mark our eighth consecutive quarter of positive normalized EBITDA, a clear result of our relentless focus on stabilizing operations while delivering top-tier service to our clients. Strengthening our balance sheet remains a priority and we're continuing to drive deleveraging through strong operating cash flow. As we head into the second half of 2024, we remain laser focused on executing our growth strategy by expanding our customer base and continual investment in our technology platform."
Q2 2024 financial highlights:
- Revenue in Q2 2024 was $1,949,689, compared with $2,172,493 in the second quarter of 2023:
- Q2 2024 revenue decreased by $222,804 or 10 per cent versus Q2 2023. The decrease in revenue was primarily due to lower advertising revenue and award with a decrease of $188,844 or 12 per cent and $29,752 or 11 per cent, respectively. The decrease in advertising revenue is due to a decline in advertising delivery from one client compared with the previous year, offset by business growth from Millenia3 acquisition, and the decrease in award revenue is due to project delay to the second half of the year.
- Operating expenses in Q2 2024 were $1,838,985, compared with $1,889,880 in the second quarter of 2023, respectively:
- Q2 2024 operating expenses decreased by $50,895 or 3 per cent versus Q2 2023. The decrease in operating expenses is primarily attributed to lower marketing and head count expenses, offset by higher general and administrative expenses, and technology expenses.
- Normalized EBITDA in Q2 2024 was $337,816, in comparison with normalized EBITDA of $573,936 in Q2 2023:
- Q2 2024 normalized EBITDA decreased by $204,313 compared with Q2 2023. The decrease is primarily attributed to lower revenue from advertising and award, offset by lower operating expenses from head count expenses.
Financial highlights for the first six months of 2024:
- Revenue in the first six months of 2024 was $3,872,319, compared with $4,017,658 in the first half of 2023:
- Revenue decreased by $145,339 or 4 per cent in the first six months of 2024, compared with the same period of 2023. The decrease in revenue is primarily attributed to lower advertising revenue of $98,780 or 3 per cent, as well as decreased awards revenue of $59,038 or 14 per cent, offset by higher music revenue with an increase of $12,479 or 2 per cent.
- Operating expenses in the first six months of 2024 were $3,744,244, compared with $3,989,855 in the first half of 2023, respectively:
- Operating expenses decreased by $245,611 or 6 per cent in the first six months of 2024, compared with the same period of 2023. The decrease in operating expenses is primarily attributed to head count expense, offset by increased marketing expenses, general and administrative expenses, and technology expenses.
- Normalized EBITDA in the first six months of 2024 was $575,399, in comparison with normalized EBITDA of $685,332 in the first half of 2023:
- Normalized EBITDA decreased by $82,933 in the first six months of 2024, compared with the same period of 2023. The decrease is primarily attributed to lower revenue from advertising and award, offset by lower operating expenses from head count expenses.
- The company generated positive operating cash flow of $525,087 in the first six months of 2024, versus operating cash flow of $145,446 in the same period of 2023, and reduced term loan principal by $258,065 in the first six months of 2024, versus nil repayment in the same period of 2023.
About Yangaroo Inc.
Yangaroo is a technology provider in the media and entertainment industry, offering a cloud-based software platform for the management and distribution of digital media content. Yangaroo's digital media distribution system (DMDS) platform is a patented cloud-based platform that provides customers with a centralized and fully integrated workflow directly connecting radio and television broadcasters, digital display networks, and video publishers for centralized digital asset management, delivery and promotion. DMDS is used across the advertising, music and entertainment awards show markets.
Yangaroo is a publicly listed company incorporated on July 28, 1999, under the laws of Ontario as Musicrypt.com Inc. and changed to its present name on July 17, 2007. Yangaroo trades on the TSX Venture Exchange under the symbol YOO and in the United States on the OTCPK under the symbol YOOIF.
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