Red Violet, Inc.
Q1 2021 Earnings Call Transcript

Published:

  • Operator:
    Good day, ladies and gentlemen. And welcome to the Red Violet's First Quarter and 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later we will conduct a question-and-answer session and instructions will follow at that time. As a reminder, this call is being recorded. I would now like to introduce your host for today's conference, Camilo Ramirez, Director of Finance and Investor Relations. Please go ahead.
  • Camilo Ramirez:
    Good afternoon and welcome. Thank you for joining us today to discuss our first 2021 financial results. With me today is Derek Dubner, our Chairman and Chief Executive Officer; and Dan MacLachlan, our Chief Financial Officer. Our call today will begin with comments from Derek and Dan, followed by a question-and-answer session.
  • Derek Dubner:
    Thanks Camilo. And good afternoon to those joining us today to discuss the results of our first quarter 2021. Red Violet delivered a strong start to the year. We kicked off the year with our highest quarterly revenue in our history, driven by strong demand across our product suite. I'm very proud of the Red Violet team as they capitalize upon increased momentum in our markets due to the improving economy and the leverage of our differentiated assets, which translated into strong demand for our solutions. Turning now to our performance in the quarter. We generated record revenue of $10.2 million, a 10% increase over the first quarter of last year. Adjusted gross profit increased 24% to $7.5 million and adjusted gross margin increased to 73% from 65% in the same period of 2020. Adjusted EBITDA increased 66% to $2.9 million, also a record in a given quarter in our history. Most importantly, platform revenue increased to $9.8 million, 21% over the same period last year. In the first quarter of this year, we set another new record for contractual revenue at 80%.
  • Dan MacLachlan:
    Thank you, Derek, and good afternoon. We had a great first quarter. With strong profitable growth from platform revenue, we hit records in nearly every key financial metrics. We are seeing nice customer adoption across our brands, which is translating nicely into new customer revenue, as well, we are seeing strong growth revenue from existing customers. Across the board, I'm extremely pleased with how the business is performing. So let's dive into the first quarter results. For clarity, all the comparisons I will discuss today will be against the first quarter of 2020 unless noted otherwise. Total revenue was $10.2 million, a 10% increase over prior year and our highest quarterly revenue ever. Platform revenue increased 21% to a record $9.8 million. As Derek discussed, our services revenue continues to be impacted by COVID-related government-imposed collections moratoria and forbearance programs. And as a result was down 66% to $0.4 million. Our adjusted gross margin was the highest it has ever been at 73%, up 8 percentage points. These profitable dollars flowed nicely down the P&L, generating a record $2.9 million in adjusted EBITDA, up 66% over prior year. Continuing through the details of our P&L, as mentioned, revenue was $10.2 million for the first quarter, consisting of revenue from new customers of $1 million, base revenue from existing customers of $7.3 million and growth revenue from existing customers of $1.9 million. Our idiCORE billable customer base grew sequentially by 176 customers, compared to the fourth quarter of 2020, ending the first quarter at 5,902 customers. FOREWARN added over 10,400 users during the first quarter, our highest sequential increase ever. As Derek pointed out earlier, we discussed on our last earnings call that at the end of the third quarter 2020 we implemented enhanced credentialing and compliance standard, which impacted mostly smaller customers in our investigative vertical during the first quarter, and that we expected to see some residual impact in the first quarter of 2021.
  • Operator:
  • Derek Dubner:
    Thank you very much. We're very proud of posting a record quarter across many metrics. We're seeing increased momentum in the business, and we're generating cash, which we are investing to execute upon our long-term strategy. We believe we are very well-positioned for 2021 and beyond. Thank you and good afternoon.
  • Operator:
    This concludes today's conference call. Thank you for participating. You may now all disconnect.

Other Red Violet, Inc. earnings call transcripts: