Advantex Announces Fiscal 2022 Third Quarter Results

TORONTO, May 19, 2022 /CNW/ - Advantex Marketing International Inc. (CSE: ADX) ("Advantex"), a leader in the merchant cash advance and loyalty marketing products for merchants, announced its results for three and nine months ended March 31, 2022.

Highlights of financial results for three and nine months ended March 31, 2022 compared to the corresponding periods in the previous year are as follows:

	Three months ended March 31			Nine months ended March 31
	March 2022	March 2021	Inc./(Dec)	March 2022	March 2021	Inc./(Dec)
	$	$	$	$	$	$
Revenues	$        452,103	$        240,651	$        211,452	$    1,192,596	$        939,349	$        253,247
Direct expenses
Costs of loyalty rewards, and marketing  in connection with Advantex's merchant based loyalty program	$          83,286	$          55,284	$          28,002	$        296,402	$        239,134	$         57,268
Expense for provision against delinquent accounts, credit/collection expense	$               652	$            1,978	$           (1,326)	$            6,575	$          74,720	$        (68,145)
Gross profit	$        368,165	$        183,389	$        184,776	$        889,619	$        625,495	$       264,124
Selling and General & Administrative expenses	$        419,553	$        498,872	$         (79,319)	$     1,330,324	$     1,391,583	$        (61,259)
Federal Covid wage and rent subsidies	$         (29,632)	$       (132,585)	$       (102,953)	$       (139,753)	$       (385,086)	$      (245,333)
(Loss) from operations before depreciation, amortization and interest	$         (21,756)	$       (182,898)	$       (161,142)	$       (300,952)	$       (381,002)	$        (80,050)
Stated interest expense - loan payable, and 9% non convertible debentures payable	$        338,629	$        205,250	$        133,379	$        906,277	$        677,215	$       229,062
(Loss) from operations before depreciation, amortization, non cash interest and non cash items	$       (360,385)	$       (388,148)	$         (27,763)	$    (1,207,229)	$    (1,058,217)	$       149,012
Interest - Lease	$            1,201	$            3,090	$           (1,889)	$            5,065	$          10,582	$          (5,517)
Interest expense - Accretion charges,  restructuring bonus and amortization of transaction costs related to 9% non convertible debentures payable	$        199,920	$        132,141	$          67,779	$        588,405	$        449,793	$       138,612
Depreciation of right of use asset	$                    -	$          11,372	$         (11,372)	$                    -	$          34,118	$        (34,118)
Net (loss) and comprehensive (loss)	$       (561,507)	$      (534,751)	$          26,756	$   (1,800,699)	$   (1,552,710)	$       247,989

Fuller details available in the Consolidated Financial Statements and MD&A available under Advantex's profile on www.sedar.com

The above tabulation is a non-GAAP presentation and is provided to assist readers in understanding Advantex's financial performance. The information is extracted from consolidated financial statements for three and nine months ended March 31, 2022.

About Advantex:

Advantex provides working capital to merchants. Advantex also provides specialized marketing programs that enable members of Aeroplan to earn Aeroplan points at participating merchants.

Advantex shares trade on the Canadian Securities Exchange under the symbol ADX. For more information go to Advantex's profile on www.sedar.com

Advantex Marketing International Inc.
Consolidated Statements of Financial Position (unaudited)
(expressed in Canadian dollars)

	Note					March 31, 2022		June 30, 2021
						$		$
Assets
Current assets
Cash						$                  93,593		$                   82,606
Accounts receivable						49,955		93,090
Transaction credits	5					4,492,442		1,726,663
Prepaid expenses and sundry assets						41,590		43,675
						$             4,677,580		$             1,946,034
Total assets						$             4,677,580		$             1,946,034
Liabilities
Current liabilities
Loan payable	6					$             4,833,893		$             2,387,439
Lease liability	15					31,489		71,910
Loan	16					60,000		60,000
Accounts payable and accrued liabilities						2,645,760		2,731,158
9% non convertible debentures payable	7					6,472,274		-
						$           14,043,416		$             5,250,507
Non-current liabilities
9% non convertible debentures payable	7					$                            -		$             4,694,885
Lease liability	15					-		12,769
						$                            -		$             4,707,654
Total liabilities						$           14,043,416		$             9,958,161
Shareholders' deficiency
Share capital	8					$           24,530,555		$           24,530,555
Contributed surplus						7,811,710		7,364,720
Accumulated other comprehensive loss						(47,383)		(47,383)
Deficit						(41,660,718)		(39,860,019)
Total deficiency						$            (9,365,836)		$            (8,012,127)
Total liabilities and deficiency						$             4,677,580		$             1,946,034

Going concern (note 2)  and Commitments and contingencies (note 11)
The accompanying notes are an integral part of these consolidated financial statements
Approved by the Board
Director: Signed "Marc Lavine"		Director: Signed "Kelly Ambrose"
Marc Lavine		Kelly Ambrose

Advantex Marketing International Inc.
Consolidated Statements of Loss and Comprehensive Loss (unaudited)
For the three and nine months ended March 31, 2022 and 2021
(expressed in Canadian dollars)

	Note					2022		2021		2022		2021
						$		$		$		$
Revenues	14
Marketing activities						$                 114,953		$                   90,013		$                 404,020		$                 397,093
Interest income						337,150		150,638		788,576		542,256
						$                 452,103		$                 240,651		$             1,192,596		$                 939,349
Direct expenses	13/14					83,938		57,262		302,977		313,854
						368,165		183,389		889,619		625,495
Operating expenses
Selling and marketing	13/14					182,396		166,728		483,470		423,688
General and administrative	13/14					207,525		199,559		707,101		582,809
(Loss) from operations before depreciation, amortization and interest						(21,756)		(182,898)		(300,952)		(381,002)
Stated interest expense - loan payable, and 9% non convertible debentures payable	6/7					338,629		205,250		906,277		677,215
Interest - Lease	15					1,201		3,090		5,065		10,582
Non-cash interest expense - accretion charges, restructuring bonus and amortization of transaction costs related to 9% non convertible debentures payable	7					199,920		132,141		588,405		449,793
Depreciation of right of use asset	15					-		11,372		-		34,118
Net (loss) and comprehensive (loss)						$               (561,507)		$               (534,751)		$            (1,800,699)		$            (1,552,710)
(Loss) per share
Basic and Diluted	12					$ (0.00)		$                      (0.00)		$                      (0.00)		$                      (0.00)
The accompanying notes are an integral part of these consolidated financial statements

Advantex Marketing International Inc.
Consolidated Statements of Changes in Shareholders' Deficiency (unaudited)
For the three and nine months ended March 31, 2022 and 2021
(expressed in Canadian dollars)

	Class A preference shares		Common shares		Contributed surplus		Accumulated other comprehen - sive loss		Deficit		Total
	$		$		$		$		$		$
Balance - July 1, 2020	$              3,815		$    24,526,740		$       4,117,170		$           (47,383)		$   (37,768,052)		$     (9,167,710)
Recording of contributed surplus - 9% Non convertible debentures payable	-		-		3,033,105		-		-		3,033,105
Net (loss) and comprehensive (loss)	-		-		-		-		(1,552,710)		(1,552,710)
Balance - March 31, 2021	$              3,815		$    24,526,740		$       7,150,275		$           (47,383)		$   (39,320,762)		$     (7,687,315)
Balance - July 1, 2021	$              3,815		$    24,526,740		$       7,364,720		$           (47,383)		$   (39,860,019)		$     (8,012,127)
Issuance of 9% non convertible debentures payable (note 7)	-		-		446,990		-		-		446,990
Net (loss) and comprehensive (loss)	-		-		-		-		(1,800,699)		(1,800,699)
Balance - March 31, 2022	$              3,815		$    24,526,740		$       7,811,710		$           (47,383)		$   (41,660,718)		$     (9,365,836)
The accompanying notes are an integral part of these consolidated financial statements

Advantex Marketing International Inc.
Consolidated Statements of Cash Flow (unaudited)
For the three and nine months ended March 31, 2022 and 2021
(expressed in Canadian dollars)

	Note		2022		2021
			$		$
Operational activities
Net (loss) for the period			$            (1,800,699)		$            (1,552,710)
Adjustments for:
Accrued and unpaid 9% non convertible debentures payable interest	7		571,590		394,243
Interest - Lease	15		5,065		10,582
Depreciation of right of use asset	15		-		34,118
Accretion charge - 9% non convertible debentures payable	7		524,215		248,797
Restructuring bonus - 9% non convertible debentures payable	7		53,759		187,689
Amortization of transaction costs - 9% non convertible debentures payable	7		10,431		13,307
			(635,639)		(663,974)
Changes in items of working capital
Accounts receivable			43,135		40,347
Transaction credits			(2,765,779)		1,831,135
Prepaid expenses and sundry assets			2,085		12,410
Accounts payable and accrued liabilities			(85,398)		218,063
			(2,805,957)		2,101,955
Net cash (used)/generated - operating activities			$            (3,441,596)		$             1,437,981
Financing activities
Gross proceeds - 9% non convertible debentures payable	7		$             1,150,000		$                 250,000
Transaction costs - 9%  non convertible debentures payable	7		(85,616)		(62,925)
Proceeds from loan - Canada Emergency Business Account			-		20,000
Payment for lease			(58,255)		(58,253)
Increase/(Decrease) of loan payable	6		2,446,454		(1,649,224)
Net cash generated/(used) - financing activities			$             3,452,583		$            (1,500,402)
Increase/(Decrease) in cash during the period			$                   10,987		$                 (62,421)
Cash at beginning of the period			82,606		166,601
Cash at end of the period			$                   93,593		$                 104,180
Additional information
Interest paid			$                 334,687		$                 282,972
Cash			$                   93,593		$                 104,180
The accompanying notes are an integral part of these consolidated financial statements

SOURCE Advantex Marketing International Inc.

Mukesh Sabharwal, Vice-President and Chief Financial Officer, Tel: [phone], Email: [email protected]