Second-quarter financial results for Canadian tech companies continue to pour in, kicked off this week by BuildDirect and Think Research. Here’s the latest on financial losses and gains.
Losses increase at BuildDirect (along with revenues)
Vancouver-based BuildDirect posted a six-month loss of $17.6 million USD ($22.6 million CAD), August 23.
BuildDirect’s losses increased compared to the prior time period. BuildDirect posted a loss of $5.4 million USD ($6.8 million CAD) for the period spanning June to December 2020.
Despite the losses, BuildDirect CEO Dan Park remains bullish on the prospects of the company. “Our second-quarter results highlight the strength of our business as we continue the positive momentum supported by our progress of capturing recurring revenue from our pro customers,” Park said.
The company did report revenues of $23.4 million USD ($29.6 million CAD), an increase of 79 percent over second-quarter 2020. The company attributed the increase in revenue to its December 2020 acquisition of FloorSource, and an increase in customer demand for building supplies.
BuildDirect operates a platform for purchasing and selling building materials online. FloorSource is an independent retailer in Michigan, which BuildDirect purchased for up to $15.8 million USD ($20 million CAD) depending on FloorSource’s future revenues, according to The Globe and Mail.
Among its achievements last quarter, BuildDirect cited completing a reverse-takeover of VLCTY Capital Inc. on August 13. At the same time, the company raised total gross proceeds of $20.5 million CAD through a private placement.
BuildDirect also completed a non-brokered private placement for gross proceeds of $500,000 CAD, and began trading on the TSX Venture Exchange.
In 2017, the company was losing enough money that it had to seek creditor protection. That same year, former BuildDirect CEO and co-founder, Jeff Booth, left the company, citing challenges with scaling the platform, and the decision to bring on more debt to tackle the challenge.
In 2018, with former COO Dan Park installed as CEO, BuildDirect came out of creditor protection, raised $36 million CAD in new financing, and converted $19 million CAD million of interim financing for a total of $53 million CAD.
BuildDirect also added three executives formerly with Amazon, and one who held a CFO position at Old Navy, to the company in 2018.
Revenues up at Think Research, net income decreases
Think Research Corporation posted record revenue of $10.2 million CAD in Q2 2021, an increase of 167 percent over the same period in the previous year. The healthtech company showed adjusted EBITDA with a loss of $1.3 million CAD compared to a $1.9 million CAD loss for the same period in 2020.
The Toronto-based firm also noted that net income showed a loss of $5.6 million CAD compared to a $3.1 million CAD loss for the same period in 2020. Think Research chalked the loss up to higher expenses related to acquisitions, and for support for continued business growth.
Think Research also said higher stock-based compensation contributed to the drop in net income, although it was partially offset by higher revenue for the period.
Founded in 2006, Think Research is an acquisitive healthcare software firm that develops tools and content for clinicians.
Think’s CEO, Sachin Aggarwal, attributed its revenue performance to “our continued strong SaaS partnerships with health systems both in Canada and in international markets, coupled with continued expansion of our telemedicine and digital referrals software partnerships, and successful integration of our clinics business.”
In the second quarter, Think Research reached a deal to acquire fellow Toronto-based health company BioPharma Services for approximately $44.6 million in cash and equity, plus an annual earnout. BioPharma Services is a contract research organization (CRO) focused on early-stage clinical research.
Think Research had a number of other highlights to share from its second quarter, including the opening of a new digital-first clinic that offers secure virtual and in-person care for an underserved region in the Greater Toronto Area.
Other highlights include the launch of a mental health decision-support tool designed to help treat patients experiencing suicidal ideation in acute hospital settings, and the announcement of a multi-year partnership with the leading hospital information system in the Kingdom of Saudi Arabia to deploy Think Research’s clinical content software across hospitals in the country.