Fourth quarter revenue growth accelerates to 30% year-over-year on an FX Neutral basis
NEW YORK--(BUSINESS WIRE)-- VTEX (NYSE:VTEX), the enterprise digital commerce platform for premier brands and retailers, the leader in accelerating the digital commerce transformation in Latin America and now expanding globally, today announced results for the fourth quarter of 2021 ended December 31, 2021. VTEX results have been prepared in accordance with International Financial Reporting Standards (“IFRS)” and interpretations issued by the IFRS Interpretations Committee (“IFRS IC”) applicable to companies reporting under IFRS.
Geraldo Thomaz Jr., founder and co-CEO of VTEX, commented, “We are excited to announce VTEX’s strong performance in our last quarter of 2021. We continued seeing strong execution and accelerated product development, giving us confidence in the future growth of the company.” Mariano Gomide de Faria, founder and co-CEO of VTEX, added, “VTEX is better positioned than ever to reach its desirable future. The investments we’ve made in 2021 will enable us to continue growing at an accelerated pace while delivering significant operational leverage in 2022. We are thrilled to share with you the solid steps we are making in our journey to bring enterprises and brands closer to consumers.”
Fourth quarter 2021 Operational and Financial Highlights
Fourth quarter Product Innovation Highlights:
Key innovations deployed this quarter:
Full-Year 2021 Operational and Financial Highlights
Business Outlook
Online commerce penetration in Latin America continues to increase, demonstrating that consumer behavior shift towards online purchases has staying power.
We expect strong new stores’ growth, as our encouraging backlog undergoes implementation, as well as a strong performance of existing stores compared to last year, as we have already mostly lapped the impact of COVID-19.
In view of the aforementioned trends, we are currently targeting revenue in the US$33.0 million to US$33.5 million range for the first quarter of 2022, implying a 30% year-over-year FX neutral growth rate in the middle of the range.
For the full year 2022, we expect FX neutral year-over-year revenue growth of 29% to 31%, implying a range of US$158 million to US$162 million as of the end of the fourth quarter FX rates.
We will continue to invest to grow our business as we work towards enhancing our leadership position in Latin America and explore new opportunities outside the region. Considering that over the last 18 months we tripled our investments and opened attractive growth avenues for VTEX, in 2022 we will benefit from the aforementioned investment by growing at a strong pace while at the same time delivering significant operating margin expansion.
The business outlook provided above constitutes forward-looking information within the meaning of applicable securities laws and is based on a number of assumptions and subject to a number of risks. Actual results could vary materially as a result of numerous factors, including certain risk factors, many of which are beyond VTEX’s control. See the cautionary note regarding ''Forward-Looking Statements'' below. Fluctuations in VTEX’s operating results may be particularly pronounced in the current economic environment. There can not be assurance that VTEX will achieve these results.
The following table summarizes certain key financial and operating metrics for the three and twelve months ended December 31, 2021 and 2020.
Three months ended December 31,
Twelve months ended December 31,
(in millions of US$, except as otherwise indicated)
2021
2020
GMV
2,905.6
2,533.9
9,665.8
7,488.8
GMV growth year-over-year FXN (1)
16.1%
130.2%
31.1%
134.9%
Revenue
37.1
29.1
125.8
98.7
Revenue growth year-over-year FXN (1)
29.5%
78.1%
29.8%
95.3%
Non-GAAP Subscription gross profit (2)(4)
24.1
17.9
80.8
65.7
Non-GAAP Subscription gross profit margin (3)(4)
69.9%
64.6%
68.2%
70.3%
Non-GAAP income (loss) from operations (4)
(10.9)
0.1
(43.1)
10.6
Total number of employees
1,727
1,032
(1)
Calculated by using the average monthly exchange rates for the applicable months during 2020, adjusted by inflation in countries with hyperinflation, and applying them to the corresponding months in 2021, as applicable, so as to calculate what our results would have been had exchange rates remained stable from one year to the next.
(2)
Corresponds to our subscription revenues minus our subscription costs.
(3)
Corresponds to our subscription gross profit divided by subscription revenues.
Conference Call and Webcast
The conference call may be accessed by dialing +1-844-200-6205 (Conference ID – 851266 –) and requesting inclusion in the call for VTEX.
The live conference call can be accessed via audio webcast at the investor relations section of the Company's website, at https://www.investors.vtex.com/.
An archive of the webcast will be available for one week following the conclusion of the conference call.
Definition of Selected Operational Metrics
“ARR” means annual recurring revenue, calculated as subscription revenue in the most recent quarter multiplied by four.
“Customers” means companies ranging from small and medium-sized businesses to larger enterprises that pay to use the VTEX Platform.
“GMV” or “Gross Merchandise Value” means total value of customer orders processed through the VTEX Platform, including value-added taxes and shipping. Our GMV does not include the value of orders processed by our SMB Platform (Loja Integrada) or B2B transactions.
“FX Neutral” or “FXN” means a way of using the average monthly exchange rates for each month during the previous year, adjusted by inflation in countries with hyper-inflation, and applying them to the corresponding months of the current year, so as to calculate what results would have been had exchange rates remained stable from one year to the next.
“NRR” means net revenue retention, calculated on a monthly basis by dividing the subscription revenue from our platform during the current period by the subscription revenue in the same period of the previous year for the same base of online stores that were active in the same period of the previous year.
“SSS” means same-store-sales calculated on a yearly basis by dividing the GMV of active online stores in the current period by the GMV of the same active online same stores in the prior period.
“Stores” or “Active Stores” means the number of unique domains generating gross merchandise value operating on the VTEX Platform. Each customer might have multiple stores. It does not include the stores operating on our SMB Platform (Loja Integrada).
Special Note Regarding Non-GAAP financial metrics
For the convenience of investors, this document presents certain Non-GAAP financial measures, which are not recognized under IFRS, specifically Non-GAAP subscription gross profit, Non-GAAP expenses, Non-GAAP income (loss) from operations, Non-GAAP free cash flow and FX neutral measures.
We understand that Non-GAAP subscription gross profit, Non-GAAP expenses, Non-GAAP Income (Loss) from Operations, Non-GAAP Free Cash Flow and FX Neutral measures have limitations as analytical tools, and you should not consider them in isolation or as substitutes for analysis of our results of operations presented in accordance with IFRS. Additionally, our calculations of Non-GAAP subscription gross profit, Non-GAAP expenses, Non-GAAP income (loss) from operations, Non-GAAP free cash flow and FX neutral measures may be different from the calculation used by other companies, including our competitors, and therefore, our measures may not be comparable to those of other companies.
Reconciliation of Non-GAAP measures
The following table presents a reconciliation of our Non-GAAP subscription gross profit to subscription gross profit for the following periods:
Subscription revenue
34.5
27.7
118.5
93.4
Subscription cost
(10.5)
(9.8)
(38.4)
(27.8)
Subscription gross profit
17.8
80.1
65.6
Share-based compensation
0.0
0.7
Non-GAAP subscription gross profit
Non-GAAP subscription gross margin
The following table presents a reconciliation of our Non-GAAP expenses to expenses for the following periods:
Sales & Marketing
Sales & Marketing expense
(17.5)
(7.5)
(63.5)
(23.8)
Share-based compensation expense
0.6
0.8
5.5
1.0
Amortization of intangibles related to acquisitions
0.3
1.1
0.4
Offering expenses ("IPO") (1)
-
0.2
Non-GAAP Sales & Marketing expense
(16.6)
(6.6)
(56.7)
(22.4)
Research & Development
Research & Development expense
(11.9)
(6.8)
(45.2)
(19.0)
(0.2)
5.9
0.9
Non-GAAP Research & Development expense
(11.7)
(5.9)
(38.3)
General & Administrative
General & Administrative expense
(6.9)
(5.1)
(31.9)
(14.0)
7.1
Non-GAAP General & Administrative expense
(4.8)
(23.9)
(13.0)
Offering expenses ("IPO") for Sales and Marketing and Research and Development are travel-related expenses exclusively for the Event Day.
The following table presents a reconciliation of our Non-GAAP income (loss) from operations to income (loss) from operations for the following periods:
Income (loss) from operations
(13.1)
(2.1)
(65.9)
6.5
1.6
2.0
19.6
3.3
1.3
Non-GAAP income (loss) from operations
Offering expenses ("IPO") are related to Sales and Marketing and Research and Development travel-related expenses exclusively for the Event Day.
The following table presents a reconciliation of our Non-GAAP free cash flow to net cash provided (used) by operating activities for the following periods:
Net cash provided (used) by operating activities
(21.2)
2.9
(53.0)
11.2
Acquisition of intangibles related to acquisitions
(0.0)
(0.4)
Acquisitions of property and equipment
(0.1)
(0.5)
(1.4)
(1.6)
Non-GAAP free cash flow
(21.3)
2.4
(54.8)
9.5
The following table sets forth the FX neutral measures related to our reported results of the operations for the three months period ended December 31, 2021:
As Reported
FXN
Percentage change
24.8%
35.0
26.4%
Services revenue
2.6
1.4
80.3%
2.7
89.4%
Total revenue
27.5%
37.7
6.4%
(10.3)
4.9%
Services cost
(3.3)
(2.0)
63.1%
62.8%
Total cost
(13.8)
16.0%
(13.6)
14.8%
Gross profit
23.4
17.2
35.4%
39.6%
Operating expenses
(36.5)
(19.3)
89.0%
(36.4)
88.2%
Income (loss) from operation
537.0%
(12.3)
494.6%
This announcement does not contain sufficient information to constitute an interim financial report as defined in International Accounting Standards 34, "Interim Financial Reporting" nor a financial statement as defined by International Accounting Standards 1 "Presentation of Financial Statements". The financial information in this press release has not been audited.
About VTEX
VTEX (NYSE: VTEX) provides a software-as-a-service digital commerce platform for enterprise brands and retailers. Our platform enables customers to execute their commerce strategy, including building online stores (ecommerce), integrating and managing orders across different channels, and creating marketplaces to sell products from third-party vendors. Founded in Brazil, VTEX has been a leader in accelerating the digital commerce transformation in Latin America and is expanding globally. Our platform is engineered to enterprise-level standards and features. We are trusted by more than 2,400 customers, who rely on VTEX to connect with their consumers in a meaningful way through 3,200 active online stores in 38 countries (as of fiscal year ended on December 31, 2021).
Forward-looking Statements
This announcement contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1993, as amended, and Section 21E of the Securities Exchange of 1934, as amended. Statements contained herein that are not clearly historical in nature, including statements about the VTEX strategies and business plans, are forward-looking, and the words “anticipate,” “believe,” “continues,” “expect,” “estimate,” “intend,” ”strategy,” “project,” “target” and similar expressions and future or conditional verbs such as “will,” “would,” “should,” “could,” “might,” “can,” “may,” or similar expressions are generally intended to identify forward-looking statements.
VTEX may also make forward-looking statements in its periodic reports filed with the U.S. Securities and Exchange Commission, or the SEC, in press releases and other written materials and in oral statements made by its officers and directors. These forward-looking statements speak only as of the date they are made and are based on the VTEX’s current plans and expectations and are subject to a number of known and unknown uncertainties and risks, many of which are beyond VTEX’s control. A number of factors and risks could cause actual results to differ materially from those contained in any forward-looking statement. Further information regarding these and other risks is included in VTEX filings with the SEC.
As a consequence, current plans, anticipated actions and future financial position and results of operations may differ significantly from those expressed in any forward-looking statements in this announcement. You are cautioned not to unduly rely on such forward-looking statements when evaluating the information presented as there is no guarantee that expected events, trends or results will actually occur. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information or future events or for any other reason.
This announcement may also contain estimates and other information concerning our industry that are based on industry publications, surveys and forecasts. This information involves a number of assumptions and limitations, and we have not independently verified the accuracy or completeness of the information.
VTEX
Consolidated Statements of Operations
(In thousands of U.S. dollars)
Three months ended (unaudited)
Twelve months ended
December 31, 2021
December 31, 2020
34,529
27,672
118,466
93,366
2,587
1,435
7,307
5,310
37,116
29,107
125,773
98,676
(10,469)
(9,841)
(38,380)
(27,801)
(3,291)
(2,017)
(11,212)
(7,050)
(13,760)
(11,858)
(49,592)
(34,851)
23,356
17,249
76,181
63,825
General and administrative
(6,913)
(5,120)
(31,889)
(13,961)
Sales and marketing
(17,459)
(7,488)
(63,521)
(23,844)
Research and development
(11,915)
(6,827)
(45,186)
(19,039)
Other losses
(211)
123
(1,514)
(462)
(13,142)
(2,063)
(65,929)
6,519
Financial income
2,295
986
7,414
3,904
Financial expense
(3,664)
(2,311)
(12,058)
(7,038)
Financial result, net
(1,369)
(1,325)
(4,644)
(3,134)
Equity results
190
51
587
78
Income (loss) before income tax
(14,321)
(3,337)
(69,986)
3,463
Current
(35)
(1,096)
(1,646)
(4,904)
Deferred
3,731
166
11,118
616
Total income tax
3,696
(930)
9,472
(4,288)
Net loss for the period
(10,625)
(4,267)
(60,514)
(825)
Attributable to controlling shareholders
(4,270)
(60,511)
(914)
Non-controlling interest
3
89
Loss per share
Basic loss per share
(0.056)
(0.025)
(0.333)
(0.005)
Diluted loss per share
Consolidated Statements of Comprehensive Income (Loss)
Items that are or may be reclassified subsequently to profit or loss:
Foreign cumulative conversion adjustment
223
1,663
548
676
Total comprehensive loss for the period
(10,402)
(2,604)
(59,966)
(149)
Consolidated Balance Sheets
ASSETS
Current assets
Cash and cash equivalents
121,006
58,557
Restricted cash
1,183
1,429
Marketable securities and short-term investments
177,191
16,969
Trade receivables
34,682
24,491
Recoverable taxes
6,881
4,071
Deferred commissions
263
438
Prepaid expenses
7,911
2,379
Derivative financial instruments
174
Other current assets
399
Total current assets
349,516
108,731
Non-current assets
6,143
Deferred tax assets
12,572
2,174
343
3,134
556
674
1,246
389
Other non-current assets
435
53
Right-of-use assets
5,183
5,076
Property and equipment, net
4,711
4,551
Intangible assets, net
33,644
15,093
Investments in joint venture
621
136
Total non-current assets
65,454
31,280
Total assets
414,970
140,011
LIABILITIES
Current liabilities
Accounts payable and accrued expenses
29,537
20,709
Loans and financing
2,087
1,585
Taxes payables
5,035
6,790
Lease liabilities
1,105
850
Deferred revenue
16,598
14,170
133
Accounts payable from acquisition of subsidiaries
4,260
2,794
Other current liabilities
159
Total current liabilities
58,888
47,057
Non-current liabilities
1,977
1,192
4,774
Taxes payable
160
4,886
5,303
2,163
1,206
16,204
5,005
Deferred tax liabilities
2,045
731
Other
266
187
Total non-current liabilities
28,893
17,206
EQUITY
Issued capital
19
17
Capital reserve
390,466
78,945
Other reserves
652
104
Accumulated losses
(63,955)
(3,444)
Equity attributable to VTEX’s shareholders
327,182
75,622
Non-controlling interests
7
126
Total shareholders’ equity
327,189
75,748
Total liabilities and equity
Consolidated Statements of Cash Flows
Net loss of the year
Adjustments on loss of the year
Depreciation and amortization
4,072
2,400
Deferred income tax
(11,118)
(616)
Loss on disposal of right of use, property, equipment, and intangible assets
54
132
Allowance for doubtful accounts
887
972
9,217
2,803
Provision for payroll taxes (share-based compensation)
7,611
Adjustment of hyperinflation
2,274
779
Profit on investments in joint venture
(587)
(78)
Fair value gain
(1,188)
(1,454)
Other gains (losses), net
666
1,714
Working capital adjustments
(16,749)
(10,104)
(2,692)
(2,215)
(2,741)
(3,727)
Other assets
186
(13)
7,417
7,961
3,102
5,944
12,330
9,641
Other liabilities
(364)
(210)
Cash provided by (used in) operating activities
(48,137)
13,104
Income tax paid
(4,854)
(1,939)
Net cash provided by (used in) operating activities
(52,991)
11,165
Cash flows from investing activities
Purchase of short-term investment
(177,816)
Redemption of short-term investment
1,053
Purchase of marketable securities
(3,846)
Redemption of marketable securities
16,857
2,007
Interest received
588
1,037
Acquisition of subsidiaries net of cash acquired
(5,712)
(3,646)
(1,383)
(1,648)
Acquisitions of intangible assets
(368)
Net cash provided by (used in) investing activities
(166,781)
(6,096)
Cash flows from financing activities
Changes in restricted cash
246
1,337
Proceeds from the exercise of stock options
3,830
313
Net-settlement of share-based payment
(2,705)
Capital increase
1,000
156,650
Capital increase - proceeds from initial public offering, net of transaction costs
296,318
Buyback of shares
(2,423)
(129,031)
Payment of loans and financing
(10,886)
(2,999)
Interest paid
(104)
(186)
Principal elements of lease payments
(913)
(350)
Lease interest paid
(680)
(775)
Net cash provided by financing activities
283,683
24,959
Net increase in cash and cash equivalents
63,911
30,028
Cash and cash equivalents, beginning of the year
29,762
Effect of exchange rate changes
(1,462)
(1,233)
Cash and cash equivalents, end of the year
Supplemental cash flow information:
Lease liabilities arising from obtaining right-of-use assets
494
820
Accounts payable related to buyback of shares
2,016
Issue of ordinary shares as consideration for a business combination
1,469
93
Unpaid amount related to acquisition of non-controlling interest
27
Unpaid amount related to business combinations
8,264
Transactions with non-controlling interests
View source version on businesswire.com: https://www.businesswire.com/news/home/20220224005183/en/
Julia Vater Fernández Investor Relations Director investors@vtex.com
Source: VTEX Commerce Cloud Solutions LLC