Three Previously Announced Acquisitions Expected to Bolster Financial Condition for Fiscal Year 2022
WILMINGTON, Del., Nov. 14, 2022 (GLOBE NEWSWIRE) — Onfolio Holdings Inc. (Nasdaq: ONFO, ONFOW) (the “Company” or “Onfolio”), a holding company that acquires and manages a diversified portfolio of online businesses across a broad range of verticals, reported recent corporate updates and financial results for the third quarter ended September 30, 2022.
“In the third quarter, we became a publicly traded company and advanced our strategy of acquiring and managing a diversified portfolio of online businesses,” said Dominic Wells, CEO of Onfolio. “Consistent with our strategy, the proceeds from our IPO in August are being allocated towards our growth initiatives. We’re excited about our entrance to the public markets and believe our strategy will deliver growth and value creation for our shareholders.
“Following the close of the third quarter, we announced three acquisitions – SEOButler, BWPS, and Proofread Anywhere – each of which we expect to be high-quality, cash flow generating businesses. We believe each acquisition possesses long-term growth opportunities, and we look forward to demonstrating the results of our strategy in our fourth quarter earnings, which will be our first full earnings period as a publicly listed company. SEOButler, BWPS and Proofread Anywhere have proven to have stable revenue and operating income in the past, and we believe their contributions will help lead us to profitability in the future.”
Third Quarter Summary vs Year-Ago Period
- Third quarter revenue was $352.3 thousand, compared to $390.4 thousand a year ago;
- Third quarter net loss was $(969.7) thousand, or $(0.31) per diluted share, compared to net loss of $(575.8) thousand, or $(0.30) per diluted share, a year ago; and
- Cash used in operating activities in the third quarter was $(2.4) million, compared to cash used in operating activities of $(459.9) thousand a year ago.
Recent Corporate Highlights
- October 17 – completed acquisition of SEOButler, a provider of extensive products within the SEO niche including content, guest posting, social signals, and citations
- SEOButler has generated approximately $200 thousand and $50 thousand of revenue and operating income, respectively, per quarter
- October 17 – completed acquisition of Proofread Anywhere from BCP Media, a provider of extensive online resources in the form of courses, workshops and blog posts for readers looking to train and become professional proofreaders
- Proofread Anywhere has generated approximately $950 thousand and $180 thousand of revenue and operating income, respectively, per quarter
- October 27 – completed acquisition of BWPS (Prevent Direct Access and Password Protect WordPress), a developer of security plugins that allow bloggers, creators, agencies, and SMBs to protect their digital assets, products, and content
- BWPS has generated approximately $100 thousand and $80 thousand of revenue and operating income, respectively, per quarter
Third Quarter 2022 Financial Results
Total revenue in the third quarter of 2022 was $352.3 thousand, compared to $390.4 thousand a year ago. The 10% decrease was primarily attributable to decreased services revenue driven by lower advertising, profit share and management fee revenue.
Gross margin in the third quarter of 2022 was 38.4% versus 35.5% in the year-ago quarter. The increase was due to lower revenue from certain services were offset by lower costs.
Operating expenses in the third quarter of 2022 were $1.1 million, up from the $717.3 thousand a year-ago. The increase was due to higher labor costs as a result of the Company filling out required roles for the business, an increase in professional fees from the Company’s Initial Public Offering, and an increase in stock-based compensation partially offset by a decrease in advertising costs.
Net loss in the third quarter of 2022 was $(969.7) thousand, or $(0.31) per diluted share, compared to net loss of $(575.8) thousand, or $(0.30) per diluted share, in the year-ago quarter. The increase in net loss was due to the reasons cited above.
Balance Sheet and Cash Flow Summary
At September 30, 2022, the Company had $11.6 million of cash and cash equivalents, compared to $1.7 million as of December 31, 2021. The increase was mainly a result of raising capital from the sale of common stock units in our initial public offering that closed on August 30, 2022 where we received $12.1 million in net proceeds. Cash used in operating activities increased to $2.4 million, compared to cash used in operating activities of $459.9 thousand a year-ago. The increase was primarily a result of the increased general and administrative costs as the Company expanded its operations.
Onfolio Holdings Inc.
Onfolio acquires and manages a diversified portfolio of online businesses across a broad range of verticals, each with a niche content focus and brand identity. Onfolio acquires business that meet its investment criteria, being that such businesses operate in sectors with long-term growth opportunities, have positive and stable cash flows, face minimal threats of technological or competitive obsolescence and can be managed by our existing team or have strong management teams largely in place. The Company excels at finding acquisition opportunities where the seller has not fully optimized their business, and Onfolio’s experience and skillset allows it to add increased value to these existing businesses. Visit www.onfolio.com for more information.
Safe Harbor Statement
The information posted in this release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. You can identify these statements by use of the words “may,” “will,” “should,” “plans,” “explores,” “expects,” “anticipates,” “continues,” “estimates,” “projects,” “intends,” and similar expressions. Examples of forward-looking statements include, among others, statements we make regarding expected operating results, such as revenue growth and earnings, and strategy for growth and financial results.
Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: general economic and business conditions, effects of continued geopolitical unrest and regional conflicts, competition, changes in technology and methods of marketing, delays in completing new customer offerings, changes in customer order patterns, changes in customer offering mix, continued success in technological advances and delivering technological innovations, delays due to issues with outsourced service providers, those events and factors described by us under the caption “Risk Factors” included in our SEC filings and other risks to which our Company is subject, and various other factors beyond the Company’s control. Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.
Alex Thompson / Greg Robles
Gateway Group, Inc.