Oct 17, 2018
Executives
James Bigg - Senior Manager of Communications John Levy - Chairman and Chief Executive Officer Benjie Levy - President and Chief Operating Officer
Analysts
Nikhil Thadani - Mackie Research Rob Goff - Echelon
Operator
Good afternoon, ladies and gentlemen. And welcome to the theScore Fourth Quarter and Year End 2018 Results Conference Call.
At this time, all lines are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session.
[Operator Instructions] This call is being recorded on Wednesday, October 17, 2018. I would now like to turn the call over to Mr.
James Bigg, Senior Manager of Communications. Please go ahead, Mr.
Bigg.
James Bigg
Thanks, operator. Hello and good afternoon.
Many thanks for joining us on today's call and webcast for theScore's fiscal 2018 Q3 year end results. Presenting today will be theScore founder and Chief Executive Officer, John Levy; and President and Chief Operating Officer, Benjie Levy.
At this time, we'd like to caution our listeners that this presentation contains forward-looking statements. There are risks that actual results could differ materially from what is discussed and those certain material factors or assumptions are applied in making these forward-looking statements.
Any forward-looking statements contained in this presentation represent the views of management and are presented for the purpose of assisting theScore's shareholders and analysts in understanding theScore's financial position, objectives and priorities and anticipated financial performance. Forward-looking statements may not be appropriate for other purposes.
Additional information on items of note, theScore's reported results and factors and assumptions related to forward-looking information are all available in our annual information form and our MD&A for Q4 fiscal 2018, which was filed on SEDAR a few moments ago. Our CEO, John will now begin the presentation.
John Levy
Thanks James, and good afternoon to everyone. Thank you for joining us for our review of Q4 and the end of fiscal 2018.
Let's dive straight into some of the key highlights from the past quarter. Revenues for Q4 grew to $5.1 million versus $4.8 million for the same period the previous year, which meant we finished the fiscal 2018 with the total revenue of $27.7 million, up from $26.3 million over fiscal 2017.
EBITDA loss for fiscal 2018 improved to $2.4 million, compared to a loss of $5.9 million for the previous year. Substantially all of our EBITDA loss for the fiscal 2018 can be attributed to Q4 activities and was due to a combination of increased facilities, administrative and other expenses including expenses relating to US sports betting business development activity, as well as direct sales for the quarter, which despite being up 6% year-over-year were below our own expectations.
In Q4, we saw the continued growth of theScore app on iOS boosted by our coverage of the 2018 FIFA World Cup. We increased users on this platform by 12.5%, including growth of 17% in June alone.
This meant total average monthly active users of theScore app grew to 3.7 million versus 3.5 million in the same period last year, up 5%. With that iOS growth partially offset by lower monthly active users on Android.
Our flagship app has continued to reinforce its position as one of the most popular in North America over the past fiscal year, and we go into Q1 with a number of exciting initiatives including, first harnessing the conversations around sports within the app itself. Further testing new ways to surface and present news content on mobile, and introducing dedicated fantasy and sports betting sections to give fans a more holistic experience when following their favorite teams, and their favorite leagues.
In addition to the growth of our app audience, we also continue to grow our audiences elsewhere, reaching an average of now 55 million sports fans a month by our social platforms, including a new single month record of over 70 million in June. These channels remain a powerful brand building channel for us and position us as a true leader in digital sports media, with best-in-class engagement and growth rates.
The success has also opened the way for new and exciting original longer-form video content initiative to be created and served up across our platforms. Such as the debut of theScore X Series with NBA all-star Lance Stephenson.
And this has already opened up new conversations with other top level athletes and teams for theScore to tell their stories on theScore. Our eSports video content also reached new heights in Q4 with our content reaching 33 million viewers, growth of more than a 170% over last year.
Our YouTube channel also smashed through the 400,000 subscriber mark, and we are now very much recognized as a leading independent media outlet for competitive gaming coverage, finding ourselves nominated for industry awards as a result. This growth and engagement around our video content has been incredible, and have begun to attract interest from brands looking to engage the fans of competitive gaming, In Q4, we continue to pursue opportunities related to the US Supreme Court's repeal of Professional and Amateur Sports Protection Act, which allowed individual states to begin exploring legalized sports betting models.
As part of this, we secured the services of former Wynn Resorts International interactive gaming Chief David Wang. David brings a wealth of experience and has joined theScore as Senior Advisor.
We are very pleased to have him on board. With only three states offering fulsome online sports betting, the current market may be limited in scope, but we do see exciting near-term and long-term potential for theScore, thanks to our large and engaged audience and our expertise in delivering a great mobile experience.
I'll now turn things over to Benjie who will take a closer look at some of our product development, content and social initiatives as well as our financials.
Benjie Levy
Thanks John and good afternoon everyone. As John touched upon, this quarter was hugely successful in terms of growing the reach of our content, and the size of theScore audience.
On our flagship app, our World Cup coverage helped drive user growth with soccer fans eagerly consuming our real-time coverage from the tournament in Russia. We made significant upgrades to our match up pages for this tournament.
We added a new Timeline feature which showcased all key match incidents at a glance, as well as player specific stats like top performers and key players. These features were then rolled out across our other soccer leagues in time for the start of the new European season making our offering one of the best for real-time soccer scores and news.
Our in-app coverage of the World Cup was also supported by our live scores data and news offering from our Facebook messenger bought with our instant game also providing another fun way for fans to engage with the tournament. We also localized these services into French, Portuguese and Spanish to further capitalize on the global appeal to soccer.
During the quarter, we also began to test a number of social related features within our app. Following sports teams is an inherently social experience, and we believe there is a significant opportunity to enable fans to connect and engage with each other around their favorite teams, live events and content they care about.
Early results have been encouraging and building on this foundation will be one of our focuses during Q1. Audience and engagement across our social channels continue to lead the digital sports media industry.
Our growth rate and engagement metrics comfortably beat out our peers once again, helping us achieve a cross-platform reach of more than 55 million sports fans a month on average during Q4. This is huge brand amplification and continues to serve as a means of engaging with existing fans while also uncovering new ones.
This approach is not going unnoticed and earlier this month we were announced as a finalist in the category of Social Media Team of the Year at the Digiday Publishing Awards in New York. To build on this success, our team also successfully took the first steps into longer-form original video production under our sports vertical for the first time.
We launched our new series known as theScore X with exclusive access for our profile of NBA star Lance Stephenson. This not only drove engagement on our own platforms, but also drove 80 million earned media impressions as dozens of other talk to your news outlets including ESPN and Sports Illustrated picked up our scoop of why Lance infamously blew in LeBron's ear during the 2014 playoffs.
This was a hugely encouraging debut for theScore X, and we're looking forward to seeing more of these pieces in the coming month. In our app, we also introduced new content offerings including stories, a new highly visual way of presenting news and rich media content.
We've also further built out our already strong sports betting data and content offering by incorporating even more gambling focused articles and hiring a dedicated news editor for this topic. Another focus during Q1 will be introduced increased betting related content and stats within our app making it more easily accessible with inbox scores, and allowing fans to subscribe to betting related news and data alerts for a more complete in-game experience.
For eSports, Q4 was another stellar quarter of growth. The 33 million video views we achieved between June and August was growth of a 115% year-over-year, as our team continues to develop and grow video franchises that fans of competitive gaming love to consume.
Our YouTube channel also hit more than 400,000 subscribers in Q4 and with our viewing numbers and ours continuing to trend upwards, theScore is now comfortably regarded as one of the most prominent eSports media platforms. In fact, last month we were named as a finalist for the Synopsis Media Awards where we'll be going up against the likes of NBA TV's the starters and The Ellen Show among others for the prize of best category specific YouTube channel.
I'll now take a closer look at our financials. Q4, 2018 revenue compared to Q4, 2017 revenue was $5.1 million versus $4.8 million.
In Q4, 2018, expenses were $8.5 million versus $7.6 million in the prior year. As noted earlier, the increase can be attributed to a combination of increased facilities, admin and other expenses including expenses related to US sports betting business development activities.
As a result of these expenses and sales which well up 6% year-over-year were below our expectation. EBITDA loss for Q4 was $2.4 million versus an EBITDA loss of $1.9 million in Q4 fiscal 2017.
We finished the quarter with $6.3 million of cash and cash used for the quarter was $1.5 million versus cash use of $2.6 million in the quarter in the previous year. That concludes the formal part of our presentation.
Operator, we will now take any questions.
Operator
[Operator Instructions] Your first question is from Nikhil from Mackie Research Capital. Nikhil, please go ahead.
Nikhil Thadani
Thanks guys. I wanted to go back to the big question of sports betting here.
I was just curious if you've seen sort of any initial signs of increased engagement or downloads or anything of that sort even though we are only live in about three states right now as you mentioned? Any sort of early signs of that that you could perhaps point to?
John Levy
Hi, Nick. I think one of the most interesting things we've seen is I hope you've had a chance to play with our new chat feature that we released a few weeks ago on Android, and actually earlier this week on iOS.
But one of the things we know about our users is that they are highly, highly engaged and are very predisposed to betting. And that has come out loud and clear when we've given them an opportunity to engage with each other.
Invariably, the dominant topic that we see users talking about in chat relates to sports betting, and who do they have and who do they like and how a player is performing. And they're living and dying on every play during the game.
And they're talking about it. And so in terms of initial signs about how we think our users react to that.
I think it is a very positive.
Nikhil Thadani
Right and then do you have a timeline for these betting related product enhancements that you spoke about in your script in the next couple weeks I imagine right because --
John Levy
Yes. They'll be rolling out over the course of Q1.
This is both from a data side and also an editorial perspective helping surface more in-depth content alerts editorial throughout the app.
Nikhil Thadani
Got it. And then it's --I appreciate that it's still pretty early to say, but if we were to sort of guess right now is your sense that as you roll these new products out in terms of ad inventory and engagement and page views or whatnot we should see perhaps a slightly higher than expected trend up in Q1 and Q2 than in the past given this sort of initial sports betting push or where am I sort of extrapolate it too much.
John Levy
It's tough to speculate on how any individual feature is going to contribute to kind of growth and impressions in that inventory. I mean certainly we think that the features that we are rolling out are going to be compelling and help enhance and create a stickier product, absolutely.
Nikhil Thadani
Okay and then in terms of the costs with the sports betting sort of initiatives in Q4, are you able to quantify that? And are most of those cost sort of done or should we expect similar costs going forward in fiscal 2019?
John Levy
Listen, certainly as we're looking for how to participate best in this evolving landscape. We're going to be spend-- continuing to spend in relation to our business development activities.
I can't quantify the specific amount that was spent in Q4, but certainly if you're looking at what the year-over-year increases in that facilities and mid line item over the prior year, a good chunk of it relates to that.
Nikhil Thadani
Right, right. And just one last one before a pass the line here.
In terms of the direct sales in Q4, are you able to give us any more color as to sort of what was perhaps the cause of the softness there and how that's looking in Q1 and potentially beyond? Thanks guys.
John Levy
No problem, Nick. I think Q4 is -- listen, it was --when we're dealing with a sales budget of --we're dealing with sales of $5.1 million for the quarter and our guys are out selling six-figure campaigns.
A couple that you expect to land in the quarter that don't land in the quarter make a difference to your year-end results. So we certainly don't see it as anything systemic.
Operator
Your next question is from Rob from Echelon. Rob, please go ahead.
Rob Goff
Thank you very much. My question would go back to that of the expense line.
Would you say that this is a new run rate or would you say that some of the expenses there were one-time in nature? So it would actually step back down modestly.
John Levy
I think I would expect them to step back down modestly. We're going to continue to spend but Q4 was particularly high in terms of the biddy activities.
Rob Goff
Any sort of figure that you could put on that and ballpark?
John Levy
No. Listen, I think as we move forward in this landscape, it's pretty fluid, right.
So we're evaluating a number of opportunities in the gaming space and kind of the spend is going to be dictated by how some of those unfold over the coming month.
Rob Goff
Okay, thank you. And if I may, it's great that you're giving us the iOS users.
What percentage of your base roughly would they represent now?
John Levy
I'd say about 60%-65% of our base is iOS.
Rob Goff
Okay. And the performance trends within iOS and non iOS, android have been relatively similar or consistent within category?
John Levy
In terms of user engagement, yes, correct.
Operator
Thank you. There are no further questions at this time.
Please proceed, Mr. Bigg.
James Bigg
Thanks everyone for joining us for our conference call. We look forward to present to you again when we deliver our Q1 results in mid -January.
Operator
Ladies and gentlemen, this concludes your conference call today. We thank you for participating and ask that you please disconnect your lines.