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Kuuhubb Studies 2020 Fiscal Yr Finish Audited Annual Monetary Outcomes and Supplies Company Replace TSX Enterprise Alternate:KUU

TORONTO, Oct. 28, 2020 (GLOBE NEWSWIRE) — Kuuhubb Inc. (“Kuuhubb” or the “Firm”) (TSXV: KUU), a cellular recreation improvement and publishing firm targeted on offering the feminine viewers with inventive interactive gaming experiences, has introduced that it has launched its audited annual monetary outcomes for the monetary yr ended June 30, 2020. The outcomes have been filed with the Canadian Securities Directors and at the moment are out there on SEDAR.

Highlights:

  • Revenues of US$7,803,832 for the yr ended June 30, 2020.
  • Recolor acknowledged income of US$6,795,445 for the yr ended June 30, 2020.
  • Commercialization of next-generation Match-Three recreation platform gives entry into multi-billion greenback gaming style.
  • Sale of belongings comparable to Recolor to fund next-generation recreation commercialization initiatives into consideration.

CEO’s Message:

Jouni Keränen, CEO of Kuuhubb Inc., commented:

“Kuuhubb is a younger firm within the midst of a change. Up till this level, now we have been targeted on the acquisition of confirmed, but under-appreciated belongings which show the potential to seize a worldwide consumer following. Growing that potential was achieved with Recolor via investing expertise and sources into the know-how, making quite a few product enhancements, pursuing partnerships and successfully advertising to our audience to in the end construct a loyal consumer group.

Nevertheless, the success of our firm doesn’t revolve round one recreation title. Slightly, our expertise and success with Recolor has offered us the experience and confidence to establish rising gaming developments, broaden our recreation portfolio and focus our sources in creating and advertising our subsequent technology of thrilling video games. For us at Kuuhubb, the Match-Three style guarantees to be that future. We’ve got deployed capital and sources to develop our personal Match-Three recreation engine and commercialize Kuuhubb’s first in-house developed Match-Three title, “Tiles & Tales”. The Match-Three recreation style is by far the biggest phase amongst feminine avid gamers, producing over US$5B per yr and representing over one-fifth of your complete US iPhone gaming market.

As a part of the transformation and elevated concentrate on Match-Three video games now we have decreased total prices by over USD 1 million yearly, together with shutting down non-performing third-party publishing workplace in Amsterdam and ceasing market entry operations in India. We’ve got to acknowledge that not each recreation, crew or initiative will succeed and we are going to develop into sooner at recognizing that and redeploying the sources in to efforts that maximize future returns.

As acknowledged in our 2020 monetary report, we’re in ongoing, superior discussions for the potential divestment of Recolor. Realizing Recolor’s future worth now will permit us to spend money on our subsequent technology video games. We strongly consider that our best alternative for development and long-term success lies in creating and working video games we develop ourselves utilizing proprietary software program comparable to our Match-Three engine mixed with strategic alliances with robust companions including not solely monetary power, however business particular experience and synergistic advantages. Kuuhubb’s strengths – innovation, information pushed strategy and a singular expertise pool in Helsinki, present us the very best path for scalable future development and profitability.”

Audited Annual Monetary Outcomes for the Monetary Yr Ended June 30, 2020:

  • The Firm generated a complete of US$7,803,832 revenues for the yr ended June 30, 2020. Recolor Oy acknowledged income of US$6,795,445 for the yr ended June 30, 2020 earlier than it was categorised as asset held on the market(1).
  • The Firm additionally acknowledged income of US$1,008,387 for the yr ended June 30, 2020 from its persevering with operations. This income was generated primarily from the subscriptions to, and in-application sale of digital items from its “My Hospital” recreation totaling US$0.79 million and promoting income of US$0.23 million.
  • The Firm incurred price of gross sales of US$631,306 for the yr ended June 30, 2020 in its persevering with operations. The price of gross sales is predominantly associated to the applying market (comparable to Apple App Retailer and Google Play) charges and different third-party direct prices.
  • The Firm incurred consulting {and professional} charges of US$939,124 for the yr ended June 30, 2020. These charges have been associated to Kuuhubb’s audit charges, basic authorized counsel and different skilled providers.
  • The Firm’s Recolor Oy confirmed EBITDA of US$538,655 by adjusting the web revenue earlier than tax from discontinued operations of US$491,370 with the next objects:

    Add again of:
    –  Non-cash depreciation and amortization of US$18,647;
    –  Internet curiosity and accretion bills of US$25,612;
    –  Overseas trade lack of US$3,026

  • The Firm confirmed EBITDA of detrimental US$3,893,435 by adjusting the web loss earlier than tax from persevering with operations of US$6,274,846 with the next objects:

    Add again of:
    –  Non-cash depreciation and amortization of US$812,812;
    –  Non-cash share-based compensation of US$860,870;
    –  Internet curiosity and accretion bills of US$984,279;
    –  Non-cash truthful worth change of mortgage receivable from Valiance UG of US$405,703

    and deduct:
    –  Honest worth change of spinoff legal responsibility of US$677,806;
    –  Overseas trade achieve of US$4,446

  • The approved share capital of the Firm consists of an infinite variety of frequent shares. As at October 26, 2020, the Firm had excellent 55,752,709 frequent shares and seven,450,000 inventory choices.
  • The Firm additionally has two convertible debentures with face worth of €2,000,000 every. The debentures might be transformed to roughly 6,408,727 frequent shares upon conversion.

(1) Classification of Recolor Oy as held on the market and discontinued operations

As a part of the efforts to satisfy the Firm’s obligations and construct development, the Firm introduced it’s exploring a number of strategic options, together with the divestiture of Firm-owned belongings comparable to shares of Recolor Oy. This can be accomplished inside twelve months and as such the related belongings and liabilities inside Recolor Oy are introduced as held on the market and the web revenue attributable as discontinued operations within the consolidated monetary statements. Except in any other case indicated, the evaluation and discussions herein are based mostly on the Firm’s persevering with operations encompass the Firm’s “My Hospital” operation.

Subsequent Occasions to Fiscal Yr Finish:

Subsequent to the fiscal yr ended June 30, 2020, the Firm acquired the next extra financing and made the next bulletins.

Closing of Non-Convertible Debenture Financing

On September 30, 2020, the Firm introduced the closing of a non-convertible debenture financing (the “Providing”) for mixture gross proceeds of US$1,300,000 on a non-brokered foundation. The Providing consists of secured debentures (“Debenture”), every of which has a face worth of US$29,500, a Maturity Date twenty-four months from the date of closing, and bears curiosity at a charge of 12% every year.

The Firm intends to make use of the proceeds from the Providing for enterprise improvement and basic working capital functions. Full particulars of the Providing can be found within the Firm’s information launch dated September 23, 2020 and filed below Kuuhubb’s profile at www.sedar.com.

Settlement Settlement with Cherrypick Video games

On October 7, 2020, the Firm introduced that additional to its information launch issued on August 19, 2020, it had agreed to settlement phrases (the “Settlement”) with Cherrypick Video games S.A. (“Cherrypick”). Phrases of the Settlement present for a decrease whole cost quantity from Kuuhubb to Cherrypick and the entire switch of the “My Hospital” recreation from Cherrypick to Kuuhubb. The Settlement units out a cost schedule that’s to be fulfilled by Could 31, 2021. Kuuhubb is, with the help of Cherrypick, within the strategy of transferring the sport improvement to Kuuhubb’s improvement crew in Helsinki and is deliberate to have full management of the supply code by November 1s 2020.

Additional particulars on the arbitration award and settlement between Cherrypick and Kuuhubb’s might be discovered within the Firm’s consolidated monetary statements for the yr ended June 30, 2020 and information launch dated August 19, 2020, below the Firm’s profile at www.sedar.com.

Exploration of Strategic Alternate options to Improve Shareholder Worth

On September 30, 2020, the Firm introduced that it has been conducting a course of to discover strategic options, together with the potential divestiture of sure Firm-owned belongings, together with the sale of Recolor Oy inside the subsequent twelve months. The Firm along with Ernst & Younger, has recognized a possible purchaser and negotiations are presently at a complicated stage. Administration famous that, whereas they continue to be dedicated to their acknowledged goal of making sustainable shareholder worth via the acquisition of confirmed, but under-appreciated belongings with long-term development potential, they do have an obligation to their stakeholders to fastidiously take into account and overview any choices which will improve shareholder worth, together with the doable advantages of realizing that future worth now. There might be no assurance that the strategic options overview course of will lead to any strategic change or final result and the Firm doesn’t know the precise timetable for the conclusion of its overview of strategic options.

On February 12, 2020, the Firm introduced the getting into right into a sale and buy settlement with Codecacao d.o.o., pursuant to which the Firm would purchase (the “Codecacao Acquisition”) 100% of the issued and excellent shares of Codecacao in consideration for 1,000,000 frequent shares of the Firm, payable in installments, and €150,000. Completion of the Codecacao Acquisition is topic to the receipt of all regulatory approvals, together with the approval of the TSX Enterprise Alternate and shareholder approval. Within the occasion of a sale of Recolor Oy, the Firm anticipates that the Codecacao Acquisition is not going to be accomplished. Additional bulletins will likely be made on the standing of those transactions.

FTC Settlement

Through the yr ended June 30, 2020, the Federal Commerce Fee (“FTC”) alleged the Firm, via its “Recolor” cellular app, has violated sure privateness safety act within the U.S. by gathering sure privateness info with the app. Whereas the Firm denies the allegations, it has totally cooperated with FTC. The Firm is within the ultimate levels of settlement discussions with the FTC. As such, the Firm has accrued and recorded a provisional settlement cost on the consolidated statements of loss and complete loss.

EBITDA – Non-IFRS Measure

EBITDA is meant to offer extra info to traders and analysts. The Firm calculated EBITDA as set out on web page 2 of this press launch. EBITDA doesn’t have any standardized which means prescribed by IFRS and shouldn’t be thought of in isolation or as an alternative to measures of efficiency ready in accordance with IFRS. Different corporations could calculate EBITDA in a different way.

About Kuuhubb

Kuuhubb is a publicly listed cellular recreation improvement and publishing firm, concentrating on the feminine viewers with bespoke cellular experiences. Our Mission is to develop into a high participant within the feminine cellular recreation house. We consider in empowering girls by creating video games and apps that can have our feminine viewers chill out, specific and entertain themselves day-after-day. By way of our video games and partnerships with choose builders, we discover new way of life developments that may be transformed into video games and apps which is able to convey worth to our customers, workers, and shareholders. Headquartered in Helsinki, Finland, Kuuhubb has a worldwide presence with a robust concentrate on U.S. and Asian markets.

Cautionary Notice Regarding Ahead-Trying Info

This press launch accommodates forward-looking info. All statements, aside from statements of historic reality, that handle actions, occasions or developments that the Firm believes, expects or anticipates will or could happen sooner or later (together with, with out limitation, statements regarding future income and improvement, development of the Firm’s enterprise) are ahead wanting info. This forward-looking info displays the present expectations or beliefs of the Firm based mostly on info presently out there to the Firm. Ahead-looking info is topic to various dangers and uncertainties which will trigger the precise outcomes of the Firm to vary materially from these mentioned within the forward-looking info, and even when such precise outcomes are realized or considerably realized, there might be no assurance that they may have the anticipated penalties to, or results on the Firm. Components that might trigger precise outcomes or occasions to vary materially from present expectations embrace, amongst different factor:, dangers associated to the expansion technique of the Firm; the chance that outcomes from the Firm’s development plans is not going to be in keeping with the Firm’s expectations; the early stage of the Firm’s improvement; competitors from corporations in various industries; the power of the Firm to handle growth and combine acquisitions into its enterprise, future enterprise improvement of the Firm, together with the power to finish the sale of Recolor OY and the Codecacao Acquisition on phrases that are financial or in any respect; the power to foretell and counteract the results of COVID-19 on the enterprise of the Firm, together with however not restricted to the results of COVID-19 on its enterprise segments, capital market circumstances, restrictions on labour and worldwide journey and provide chains; and the opposite dangers disclosed below the heading “Danger Components” within the Firm’s administration dialogue and evaluation for the twelve months ended June 30, 2020 filed on SEDAR at www.sedar.com. Ahead-looking info speaks solely as of the date on which it’s offered and, besides as could also be required by relevant securities legal guidelines, the Firm disclaims any intent or obligation to replace any forward-looking info, whether or not on account of new info, future occasions or outcomes or in any other case. Though the Firm believes that the assumptions inherent within the forward-looking info are cheap, forward-looking info will not be a assure of future efficiency and accordingly undue reliance shouldn’t be placed on such info because of the inherent uncertainty therein.

Neither TSX Enterprise Alternate nor its Regulation Providers Supplier (as that time period is outlined within the insurance policies of the TSX Enterprise Alternate) accepts accountability for the adequacy or accuracy of this launch.

For additional info, please contact:

Kuuhubb Inc.
Jouni Keränen – CEO
[email protected]
Workplace: +358 40 590 0919

Invoice Mitoulas
Investor Relations
[email protected]
Workplace: +1 (416) 479-9547

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