QuarticOn looking to boost growth and at exploring acquisition opportunities

QuarticOn, a provider of cutting-edge services and innovative real AI-based systems, is looking to expand its sales channel based on a fully SaaS model. The Company is planning to launch its solutions on more e-commerce platforms to scale up its business and gain a large number of customers from numerous foreign markets in one go. With this purpose in mind, QuarticOn is to summon an Extraordinary General Meeting in a few days to make the decision on issuing up to 20,000 Series-F shares as part of a private placement. QuarticOn is also looking at acquisition opportunities to expand the market for its services, or to lay down technological foundations for new projects.

QuarticOn’s strategy is based on three pillars of development – expanding into new markets, enlarging the product portfolio, and entering new sales channels to reach new customer groups. With regard to the third pillar, in August 2019 QuarticOn launched its technology on the Shoptet platform, bringing together more than 18,000 online stores in the Czech Republic and Slovakia (charging a monthly subscription of €20). In September the Company launched new subscription plans and apps for Shoper (PLN 99 per month) and Creative Sites (€150 and €300 per month), gaining access to nearly 14,000 potential customers. Before the end of this year QuarticOn should be releasing its solution on Shopify – a global platform with over 200,000 stores. QuarticOn is planning to use the proceeds from the Series-F share issue to support financing the development of SaaS solutions (including new products released as plug-ins), which will increase the availability of the Company’s services across thousands of stores.

Having completed our first launches, we are positive that e-commerce platforms constitute an extremely attractive market segment for us, and that our presence there is bringing measurable business benefits. We know how to integrate our solutions with external e-commerce platforms in process- and cost-efficient ways, and the proceeds from the private placement will enable us to speed up our work and increase sales in the SaaS channel by leaps and bounds” said Paweł Wyborski, founder and CEO of QuarticOn SA.

The Company is also consistently committed to the two other pillars of its strategy – strengthening its position on the existing markets and launching new and innovative products. In addition to organic growth, QuarticOn is also considering acquisitions. To secure funds for potential investments, the Company will issue its shares. Hence, the agenda of the Extraordinary General Meeting to be called in a few days’ time will incorporate the relevant amendments to the Articles of Association, and the Management Board’s authorisation until 31 December 2020 to increase the Company’s share capital through one or several capital increases within the authorised share-capital limit by issuing no more than 100,000 Series-G ordinary shares.

We are looking at potential acquisition targets. At this time we have identified 2-3 entities with revenues of PLN 1-3 million which could enable us to scale up our business on new markets or provide technological assistance in expanding our product portfolio. However, we are still in the process of analysing various scenarios to select the one which will maximise the value of the potential acquisition for our shareholders. The EGM’s approval of the share issue within the authorised share-capital limit will enable us to significantly simplify the procedure of raising capital and speed up the whole process when the time comes to make specific business decisions” said the CEO.

QuarticOn has also decided to launch the incentive programme approved in June 2018, which grants Company management staff a maximum of 152,927 Series-A subscription warrants, entitling them to subscribe for the same number of Series-D shares in the Company’s share capital. The shares will be subject to lock-up restrictions until the programme ends, in specific cases the Company will be entitled to exercise call and repurchase options. The ESOP launch will require the Company’s Supervisory Board to issue an opinion on its operating terms.

In September 2019 the Company completed the launch of a new sales model, with a new product range organised into feature bundles. Currently, its range includes about 90 features, all effective tools to optimise sales across e-commerce channels, which can be deployed stage- or group-wise. The new sales model speeds up customer acquisition, while allowing existing customers to use newly developed services. Also in September QuarticOn completed the cost optimisation process, the full results of which will be apparent in the Q4 2019 results.

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