EX-99.1 2 docebo2021q3fs.htm EX-99.1 Document
                                                                                                                                                                    Exhibit 99.1
DOCEBO INC.
UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION
(expressed in thousands of United States dollars)

September 30,December 31,
2021
20201
$$
Assets
Current assets:
Cash and cash equivalents215,507 219,658 
Trade and other receivables (Note 5)
20,647 15,690 
Prepaids and deposits5,737 2,942 
Net investment in finance lease 82 99 
Contract acquisition costs, net
2,079 1,345 
244,052 239,734 
Non-current assets:
Contract acquisition costs, net
2,055 1,456 
Net investment in finance lease238 270 
Right-of-use assets, net (Note 6)
3,321 2,798 
Property and equipment, net (Note 7)
2,743 2,290 
Intangible assets, net (Note 8)
1,706 2,096 
Goodwill (Note 9)
5,429 5,600 
259,544 254,244 
Liabilities
Current liabilities:
Trade and other payables22,234 16,121 
Deferred revenue
36,117 28,331 
Contingent consideration (Note 4)
467 — 
Lease obligations (Note 6)
1,318 1,260 
Borrowings 15 
60,136 45,727 
Non-current liabilities:
Contingent consideration (Note 4)
2,218 2,630 
Lease obligations (Note 6)
2,948 2,544 
Employee benefit obligations
2,595 2,330 
Deferred tax liability
645 707 
68,542 53,938 
Shareholders’ equity
Share capital (Note 11)
265,197 264,357 
Contributed surplus3,991 2,537 
Accumulated other comprehensive income
2,274 1,699 
Deficit
(80,460)(68,287)
Total equity191,002 200,306 
259,544 254,244 
 
1 Please refer to Note 3 for retrospective change of accounting policy.
The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

1

DOCEBO INC.
UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENTS OF INCOME (LOSS) AND COMPREHENSIVE LOSS
(expressed in thousands of United States dollars, except per share amounts)

Three months ended
September 30,
Nine months ended
September 30,
2021202020212020
$$$$
Revenue (Note 14)
27,068 16,096 74,441 44,161 
Cost of revenue (Note 15 and 16)
5,683 2,883 14,699 8,564 
Gross profit21,385 13,213 59,742 35,597 
Operating expenses
General and administrative (Note 16)
6,817 3,575 21,178 11,260 
Sales and marketing (Note 16)
11,142 5,796 30,708 17,559 
Research and development (Note 16)
5,481 3,265 14,858 9,476 
Share-based compensation (Note 12)
745 512 1,662 1,317 
Foreign exchange (gain) loss
(4,765)440 375 (1,607)
Depreciation and amortization (Note 6, 7 and 8)
501 279 1,464 771 
19,921 13,867 70,245 38,776 
Operating income (loss)
1,464 (654)(10,503)(3,179)
Finance expense, net (Note 10)
29 78 103 37 
Other income
(21)(19)(64)(57)
Income (loss) before income taxes
1,456 (713)(10,542)(3,159)
Income tax expense
795 445 1,631 754 
Net income (loss) for the periods
661 (1,158)(12,173)(3,913)
Other comprehensive loss (income)
Item that may be reclassified subsequently to income:
Exchange loss (gain) on translation of foreign operations
4,691 117 (575)2,035 
Comprehensive loss
(4,030)(1,275)(11,598)(5,948)
Income (loss) per share - basic0.02 (0.04)
(0.37)
(0.14)
Income (loss) per share - diluted0.02 (0.04)
(0.37)
(0.14)
Weighted average number of common shares outstanding - basic (Note 13)
32,834,833 28,820,652 32,809,397 28,632,806 
Weighted average number of common shares outstanding - diluted (Note 13)
34,122,772 28,820,652 32,809,397 28,632,806 

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

2

DOCEBO INC.
UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
(expressed in thousands of United States dollars, except number of shares)

Common sharesContributed surplus
Accumulated other comprehensive income (loss)
Deficit
Total
#$$$$$
Balance, December 31, 2019
28,454,200 89,745 1,102 805 (60,271)31,381 
Exercise of stock options
156,100 197 (55)— — 142 
Share-based compensation
— — 1,317 — — 1,317 
Issuance of common shares upon bought deal offering, net of share issuance costs (Note 11)
500,000 18,106 — — — 18,106 
Comprehensive loss
— — — (2,035)(3,913)(5,948)
Balance, September 30, 2020
29,110,300 108,048 2,364 (1,230)(64,184)44,998 
Balance, December 31, 2020 (Note 3)
32,630,536 264,357 2,537 1,699 (68,287)0200,306 
Exercise of stock options (Note 11 and 12)
147,025 548 (160)— — 388 
Share-based compensation (Note 12)
— — 1,662 — — 1,662 
Share issuance under ESPP (Note 11 and 12)
4,945 292 (48)— — 244 
Comprehensive income (loss)
— — — 575 (12,173)(11,598)
Balance, September 30, 2021
32,782,506 265,197 3,991 2,274 (80,460)191,002 
The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

3

DOCEBO INC.
UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS
(expressed in thousands of United States dollars)

Nine months ended
September 30,
20212020
$$
Cash flows (used in) from operating activities
Net loss
(12,173)(3,913)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization1,464 771 
Share-based compensation1,662 1,317 
Unrealized foreign exchange gain
(199)(1,516)
Deferred tax recovery(43)— 
Finance expense, net
103 274 
Changes in non-cash working capital items:
Trade and other receivables(5,245)(7,554)
Prepaids and deposits(2,859)(713)
Contract acquisition costs(1,358)(1,032)
Trade and other payables6,825 2,639 
Employee benefit obligations405 366 
Deferred revenue8,194 7,470 
Cash used in operating activities
(3,224)(1,891)
Cash flows used in investing activities
Purchase of property and equipment(999)(991)
Cash used in investing activities
(999)(991)
Cash flows (used in) from financing activities
Payments received on net investment in finance lease64 65 
Repayment of lease obligation(1,004)(786)
Interest received306 — 
Proceeds from exercise of stock options388 142 
Proceeds from share issuance under ESPP244 — 
Proceeds from bought deal offering of common shares 19,029 
Share issuance cost (923)
Repayment of borrowings(15)(16)
Cash (used in) from financing activities
(17)17,511 
Net change in cash and cash equivalents during the period
(4,240)14,629 
Effect of foreign exchange on cash and cash equivalents89 (72)
Cash and cash equivalents, beginning of the period
219,658 46,278 
Cash and cash equivalents, end of the period
215,507 60,835 

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

4

DOCEBO INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
September 30, 2021
(expressed in thousands of US dollars, except share amounts)
1Nature of business

Docebo Inc. (the “Company” or “Docebo”) is a provider of cloud-based learning management systems. The Company was incorporated on April 21, 2016 under the laws of the Province of Ontario. The Company’s head office is located at Suite 701, 366 Adelaide Street West, Toronto, M5V 1R9, Canada.

The Company’s shares are listed on both the Toronto Stock Exchange (“TSX”), as of October 8, 2019, and the Nasdaq Global Select Market (the “Nasdaq”), as of December 3, 2020, under the stock symbol “DCBO”.

The impact of the novel coronavirus (“COVID-19”) pandemic, with its combined health toll and sharp decline in global economic output, is unprecedented and the full extent of the impact will depend on future developments. These developments are highly uncertain and cannot be accurately predicted, including new information which may emerge concerning its severity, its duration and actions by government authorities to contain the outbreak or manage its impact.

In response to the pandemic, we have modified our business practices with a focus on the health and well-being of our workforce both in Europe and North America which is now working remotely where required by local law or regulation and has been, depending on personal preferences and circumstances, provided with the flexibility to continue working remotely when such laws or regulations are lifted. The extent of the impact of COVID-19 and measures taken to contain the virus on our results of operations and overall financial performance remains uncertain.

The Company has the following subsidiaries:
Entity nameCountry
Ownership percentage
September 30,
2021
Ownership percentage
December 31, 2020
%%
Docebo S.p.AItaly100100
Docebo NA, Inc.United States100100
Docebo EMEA FZ-LLCDubai100100
Docebo UK LimitedEngland100100
Docebo France Société par Actions Simplifiée1 (“Docebo France”)
France100100
Docebo DACH GmbH2 (“Docebo Germany”)
Germany100

1 On March 18, 2021 forMetris Société par Actions Simplifiée (“forMetris”) changed its name to Docebo France Société par Actions Simplifiée.

2 On March 23, 2021 the Company incorporated a new subsidiary, Docebo Germany.

2Basis of preparation

Statement of compliance

These unaudited condensed consolidated interim financial statements (“financial statements”) have been prepared by management using the same accounting policies and methods as those used in the Company’s consolidated financial statements for the year ended December 31, 2020. These unaudited condensed consolidated interim financial statements have been prepared in compliance with IAS 34 – Interim Financial Reporting. Accordingly, certain disclosures normally included in annual financial statements prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS”) have been omitted or

5

DOCEBO INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
September 30, 2021
(expressed in thousands of US dollars, except share amounts)
condensed. These unaudited condensed consolidated interim financial statements should be read in conjunction with the Company’s consolidated financial statements for the year ended December 31, 2020.

These financial statements were approved and authorized for issuance by the Board of Directors of the Company on November 10, 2021.

Use of estimates, judgments and assumptions

The preparation of these financial statements in conformity with IFRS requires management to make estimates, judgments and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the period. Actual results could differ from those estimates.

Estimates are based on management’s best knowledge of current events and actions the Company may undertake in the future. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

In preparing these financial statements, the significant judgments made by management in applying the Company’s accounting policies and the key sources of uncertainty are the same as those applied and described in the Company’s annual audited consolidated financial statements for the year ended December 31, 2020.

3Summary of significant accounting policies

In preparing these financial statements, the significant accounting policies applied in these financial statements are the same as those applied and described in the Company’s annual audited consolidated financial statements for the year ended December 31, 2020, except as described below.

Employee share purchase plan

The first offering period under the Company’s Employee Share Purchase Plan (“ESPP”) began on January 15, 2021, with the first purchase under the plan occurring on July 15, 2021. Share-based compensation expense related to the ESPP is measured based on grant date at fair value of the expected discount to be provided to the employees who are registered in the plan. The Company recognizes share-based compensation expense related to shares issued pursuant to the ESPP on a straight-line basis over the offering period, which is 6 months. The ESPP allows employees to purchase shares of the Company's common stock at a 15 percent discount from the Company’s stock price on the last day of the offering period. Under the plan, employees may change their percentage election or withdraw from the plan at any time during the offering period. The ESPP does not include any buy-back provisions or price protection against reductions in share price.

Change in accounting policy

In March 2021, the International Financial Reporting Interpretations Committee (“IFRIC”) finalized an agenda decision which clarified the customer’s accounting for configuration and customization in a cloud computing arrangement. As a result of this decision, in Q1 2021, the Company changed its accounting policy for costs incurred for cloud computing arrangements with retrospective application. As a result of the change, intangible assets of $362 were derecognized with a corresponding increase to deficit as of December 31, 2020. There was no impact to operating expenses or net loss for the three and nine months ended September 30, 2020 as a result of this change. The impact of the change for the year ended December 31, 2020 was an increase to research and development costs of $384 and a decrease in depreciation and amortization expense of $22. The impact on net loss for the year ended December 31, 2020 was an increase of $362.


6

DOCEBO INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
September 30, 2021
(expressed in thousands of US dollars, except share amounts)
4Business combination

On October 30, 2020, Docebo acquired all of the issued and outstanding shares of forMetris, a leading SaaS-based learning impact evaluation platform based in Paris, France. Total consideration of $6,417, which includes the estimated amounts of contingent consideration, consisted of $2,624 cash paid on the closing date and the issuance of 29,024 Common Shares of the Company for consideration of $1,163, at a fair value of C$53.38 per share at the closing date, which is based on the quoted price of the Common Shares on the Toronto Stock Exchange on the closing date. The fair value of the contingent consideration of $2,630 (maximum undiscounted payable of $2,803) is payable contingent on the performance of agreed revenue milestones in each of the next three years. In addition, compensation expense is being recorded for one employee of the acquiree who is entitled to payments of up to $2,447 over the next three years based on the achievement of both yearly performance milestones and continued employment. The contingent consideration and the employee compensation expense installments are to be paid by a combination of 20% in cash and 80% in shares of the Company (subject to any required regulatory approvals).

The acquisition has been accounted for as a business combination in accordance with IFRS 3, Business Combinations, using the acquisition method whereby the net assets acquired and the liabilities assumed are recorded at fair value. The allocation of the purchase price to assets acquired and liabilities assumed was based on management’s best estimates of the fair values as at October 30, 2020. As at March 31, 2021, the Company finalized the fair value of the assets acquired and liabilities assumed at the acquisition date which led to a revised assessment of trade and other payables resulting in a reduction of $102 to goodwill compared to the previously estimated amounts reported in the 2020 financial statements.

The following table summarizes the allocations of the consideration paid and the amounts of fair value of the assets acquired and liabilities assumed at the acquisition date:
Fair value recognized on acquisition
$
Assets
Current assets:
Cash and cash equivalents174 
Trade and other receivables763 
Prepaid expenses and other current assets61 
998 
Non-current assets:
Property and equipment, net— 
Right-of-use asset, net194 
Customer relationships1,458 
Technology548 
Trade name and trademarks47 
Goodwill5,461 
Other non-current assets71 
Total assets8,777 

7

DOCEBO INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
September 30, 2021
(expressed in thousands of US dollars, except share amounts)
Liabilities
Current liabilities:
Trade and other payables857 
Deferred revenue700 
Finance lease liability140 
1,697 
Non-current liabilities:
Finance lease liability54 
Borrowings278 
Deferred tax liability331 
Total liabilities2,360 
Fair value of net assets acquired6,417 
Paid in Common Shares of the Company1,163 
Paid in cash2,624 
Contingent consideration2,630 
Total purchase consideration6,417 

Goodwill arising on the acquisition reflects the benefits attributable to synergies, revenue growth, future market development and the fair value of an assembled workforce. These benefits were not recognized separately from goodwill because they did not meet the recognition criteria for identifiable intangible assets. This goodwill is not deductible for income taxes.

Contingent consideration comprises earn-out payments due to sellers for meeting certain revenue conditions over the three years following the date of acquisition. The fair value of the contingent consideration was calculated using discounted cash flows and was $2,630 as at the date of acquisition. The fair value of the contingent consideration as at September 30, 2021 was $2,685 (December 31, 2020 - $2,630); $467 (December 31, 2020 - nil) will be paid in the first quarter of 2022 if the acquiree achieves its performance milestones for the fiscal year 2021. The Company incurred interest accretion in relation to the contingent consideration for the three and nine months ended September 30, 2021 of $19 and $55, respectively.

5Trade and other receivables

The Company’s trade and other receivables as at September 30, 2021 and December 31, 2020 include the following:
2021
2020
$$
Trade receivables16,755 12,660 
Accrued revenues2,276 706 
Tax credits receivable1,614 1,678 
Other receivables2 646 
20,647 15,690 

Included in trade receivables is a loss allowance of $1,125 as at September 30, 2021 and $1,146 as at December 31, 2020.



8

DOCEBO INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
September 30, 2021
(expressed in thousands of US dollars, except share amounts)
6Leases
The Company’s right-of-use assets by class of assets are as follows:
PremisesOthersTotal
$$$
Costs
Balance – December 31, 2020
3,8612974,158
Additions1,238701,308
Disposals(7)(7)
Effects of foreign exchange(97)(32)(129)
Balance – September 30, 2021
5,0023285,330
Accumulated amortization
Balance – December 31, 2020
1,1901701,360
Amortization65656712
Effects of foreign exchange(34)(29)(63)
Balance – September 30, 2021
1,8121972,009
Carrying value
Net balance – December 31, 2020
2,6711272,798
Net balance – September 30, 2021
3,1901313,321

The Company’s lease obligations are as follows:
2021
$
Balance – December 31, 2020
3,804 
Additions1,308 
Disposals(7)
Interest accretion258 
Lease repayments(1,004)
Effects of foreign exchange(93)
Balance – September 30, 2021
4,266 
Current1,318 
Non-current2,948 
4,266 

Expenses incurred for the three and nine months ended September 30, 2021 relating to short-term leases and leases of low-value assets were $76 and $234, respectively (2020 - $65 and $173).

9

DOCEBO INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
September 30, 2021
(expressed in thousands of US dollars, except share amounts)
7Property and equipment
Furniture and office equipmentLeasehold improvementsLand and BuildingTotal
$$$$
Cost
Balance – December 31, 2020
1,078 1,856 393 3,327 
Additions948 51 — 999 
Effects of foreign exchange(51)(56)(22)(129)
Balance – September 30, 2021
1,975 1,851 371 4,197 
Accumulated depreciation
Balance – December 31, 2020
526 432 79 1,037 
Depreciation237 222 10 469 
Effects of foreign exchange(30)(16)(6)(52)
Balance – September 30, 2021
733 638 83 1,454 
Carrying value
Balance – December 31, 2020
552 1,424 314 2,290 
Balance – September 30, 2021
1,242 1,213 288 2,743 

8Intangible assets
Acquired
Customer relationshipsTechnologyTrademarksTotal
$$$$
Cost
Balance – December 31, 2020 (Note 3)
1,534 577 50 2,161 
Effects of foreign exchange(85)(32)(3)(120)
Balance – September 30, 2021
1,449 545 47 2,041 
Accumulated amortization
Balance – December 31, 2020 (Note 3)
43 19 65 
Amortization188 83 12 283 
Effects of foreign exchange(10)(2)(1)(13)
Balance – September 30, 2021
221 100 14 335 
Carrying value
Balance – December 31, 2020 (Note 3)
1,491 558 47 2,096 
Balance – September 30, 2021
1,228 445 33 1,706 


10

DOCEBO INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
September 30, 2021
(expressed in thousands of US dollars, except share amounts)
9Goodwill

$
Balance – December 31, 2020
5,600 
Adjustments (Note 4)(102)
Effects of foreign exchange(69)
Balance – September 30, 2021
5,429 

10Borrowings

Credit Facility

On July 25, 2019, the Company secured a committed revolving term credit facility (the “Credit Facility”) from the Toronto-Dominion Bank. Upon the closing of initial public offering on October 8, 2019, the commitment was increased to $15,000. The amount available to be drawn under the Credit Facility from time to time is equal to the lesser of (i) the commitment and (ii) an amount equal to the trailing one-month consolidated recurring revenue of the Company (“MRR”) multiplied by six multiplied by the trailing twelve month gross retention rate percentage on MRR (which rate shall not exceed 100%), minus the amount of any statutory prior claims then in existence. The Credit Facility will mature on July 25, 2022 (the “Maturity Date”). The Maturity Date may be extended for an additional 364 days, at the discretion of the lender, upon the Company providing written notice to the lender requesting such an extension. Interest on the drawn facility is set at LIBOR plus 2.75%. The standby fee on the undrawn balance is 0.50%.

On June 1, 2021, the Company terminated the Credit Facility and repaid all accrued and unpaid interest. Unamortized financing costs of $64 were derecognized and expensed to finance expense during the second quarter. Prior to termination, the balance drawn on the facility was nil.

Finance expense, net

Finance expense for the three and nine months ended September 30, 2021 and 2020 is comprised of:
Three months ended September 30,
Nine months ended September 30,
2021
2020
2021
2020
$$$$
Interest on contingent consideration19 — 55 — 
Interest on lease obligations83 92 258 237 
Interest and amortization of deferred financing costs on credit facility 12 84 35 
Interest income(109)(26)(331)(236)
Bank fees and other36 — 37 
29 78 103 37 

11Share capital
Authorized:
Unlimited common shares with no par value
Issued and outstanding:
Number of shares
Amount

11

DOCEBO INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
September 30, 2021
(expressed in thousands of US dollars, except share amounts)
#$
Balance – December 31, 2019
28,454,200 89,745 
Stock option exercise191,429 342 
IPO share issuance (i)
500,000 18,106 
DSU release5,883 86 
forMetris acquisition (ii)
29,024 1,163 
IPO share issuance (iii)
3,450,000 154,915 
Balance – December 31, 2020
32,630,536 264,357 
Stock option exercise147,025 548 
Share issuance under ESPP (iv)
4,945 292 
Balance – September 30, 2021
32,782,506 265,197 

(i)    On August 27, 2020, the Company completed a bought deal offering comprised of 500,000 common shares issued from treasury and offered by the Company for gross proceeds of $19,029 (C$25,000). Share issuance costs for the Company amounted to $923 resulting in net proceeds of $18,106.

(ii)    On October 30, 2020, the Company acquired all of the issued and outstanding shares of forMetris for total consideration of $6,417 (Note 4). Consideration included the issuance of 29,024 common shares to the vendors of forMetris for consideration of $1,163. The measurement of the shares consideration was determined as the fair value of the shares of $40.07 (C$53.38) per share at the closing date.

(iii)    On December 7, 2020, the Company completed an IPO in the United States and concurrently listed its common shares on the Nasdaq Global Select Market and issued 3,450,000 common shares for a total gross consideration of $165,600. Share issuance costs amounted to $10,685 resulting in net proceeds of $154,915.

(iv)    On July 15, 2021, the Company issued 4,945 common shares from treasury under the Global Employee Share Purchase Plan.

12Share-based compensation

The Company has five components of its share-based compensation plan: stock options, deferred share units (“DSUs”), restricted share units (“RSUs”), performance share units (“PSUs”) and employee share purchase plan (“ESPP”). Share-based compensation expense for the three and nine months ended September 30, 2021 was $745 and $1,662, respectively (2020 - $512 and $1,317). The expense associated with each component is as follows:

Three months ended September 30,
Nine months ended September 30,
2021
2020
2021
2020
$$$$
Stock options443 306 1,103 857 
ESPP71 — 71 — 
DSUs231 206 488 460 
745 512 1,662 1,317 

There were no RSUs or PSUs issued and outstanding for the three and nine months ended September 30, 2021 and 2020.


12

DOCEBO INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
September 30, 2021
(expressed in thousands of US dollars, except share amounts)



The changes in the number of stock options during the nine months ended September 30, 2021 and 2020 were as follows:
2021
2020
Number of optionsWeighted average exercise priceNumber of optionsWeighted average exercise price
#C$#C$
Options outstanding – December 311,516,641 6.73 1,692,347 5.41 
Options granted179,961 52.40 44,190 12.44 
Options forfeited(28,736)14.84 (38,385)9.51 
Options exercised(147,025)3.37 (156,100)1.18 
Options outstanding – September 30
1,520,841 12.31 1,542,052 5.94 
Options exercisable – September 30
814,367 2.54 823,600 1.31 

The following table is a summary of the Company’s stock options outstanding as at September 30, 2021:
Options outstandingOptions exercisable
Exercise price rangeNumber outstandingWeighted average remaining contractual life (years)Exercise price rangeNumber exercisable
C$##C$#
0.0001 - 1.09784,368 5.70.0001 - 1.09695,968 
8.86 - 11.06190,522 9.218.86 - 11.0659,784 
15.79 - 16.00341,701 8.0315.79 - 16.0057,529 
26.43 - 69.48204,250 9.4526.43 - 69.481,086 
1,520,841 7.17 814,367 

The following table is a summary of the Company’s stock options outstanding as at September 30, 2020:
Options outstandingOptions exercisable
Exercise price rangeNumber outstandingWeighted average remaining contractual life (years)Exercise price rangeNumber exercisable
C$##C$#
0.0001 - 1.09927,800 6.47 0.0001 - 1.09787,200 
8.86 - 11.06221,818 10.19 8.86 - 11.0636,400 
15.79 - 26.43392,434 9.04 15.79 - 26.43— 
1,542,052 7.66 823,600 

DSUs

The following table presents information concerning the number of DSUs granted by the Company:
#
DSUs – December 31, 2020
44,142 
Granted (at C$51.63 - 77.47 per unit)
14,916 
DSUs - September 30, 2021
59,058 




13

DOCEBO INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
September 30, 2021
(expressed in thousands of US dollars, except share amounts)



13Loss per share
The following table summarizes the calculation of the weighted average number of basic and diluted common shares:
Three months ended September 30,
Nine months ended September 30,
2021
2020
2021
2020
####
Weighted average number of basic Common Shares32,834,833 28,820,652 32,809,397 28,632,806 
Share options1,228,881 —  — 
DSUs59,058 —  — 
Weighted average number of diluted Common Shares34,122,772 28,820,652 32,809,397 28,632,806 

The Company has two categories of potentially dilutive securities: stock options and DSUs. All potentially dilutive securities have been excluded from the calculation of diluted loss per share for the periods in which the Company is in a net loss position. Including the dilutive securities in these periods would be anti-dilutive; therefore, basic and diluted number of shares used in the calculation is the same for the periods presented.

The outstanding number and type of securities that could potentially dilute basic net income per share in the future but would have decreased the loss per share (anti-dilutive) for the periods in which the Company is in a net loss position are as follows:
Three months ended September 30,
Nine months ended September 30,
2021
2020
2021
2020
####
Stock options 1,270,984 1,194,544 1,168,599 
DSUs 48,043 51,088 40,312 
 1,319,027 1,245,632 1,208,911 
14Disaggregated revenue

The Company derives its revenues from two main sources, subscription to its software-as-a-service applications (“SaaS”), and professional services revenue, which includes services such as initial implementation, project management, and training.

The following table represents disaggregation of revenue for the three and nine months ended September 30:
Three months ended September 30,
Nine months ended September 30,
2021
2020
2021
2020
$$$$
Subscription revenue25,057 15,101 68,476 40,699 
Professional services2,011 995 5,965 3,462 
27,068 16,096 74,441 44,161 

14

DOCEBO INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
September 30, 2021
(expressed in thousands of US dollars, except share amounts)
15Cost of revenue

The following table represents cost of revenue for the three and nine months ended September 30:
Three months ended September 30,
Nine months ended September 30,
2021
2020
2021
2020
$$$$
Employee wages and benefits3,615 1,953 9,567 5,836 
Web hosting fees939 694 2,482 1,981 
Partner fees977 166 2,172 480 
Other152 70 478 267 
5,683 2,883 14,699 8,564 

16Employee compensation

The total employee compensation comprising salaries and benefits for the three and nine months ended September 30, 2021 was $18,554 and $51,520, respectively (2020 -$10,332 and $29,907).

Employee compensation costs were included in the following expenses for the three and nine months ended September 30:    
Three months ended September 30,
Nine months ended September 30,
2021
2020
2021
2020
$$$$
Cost of revenue3,615 1,953 9,567 5,836 
General and administrative2,666 1,633 7,797 4,683 
Sales and marketing8,231 4,219 22,609 11,998 
Research and development4,042 2,527 11,547 7,390 
18,554 10,332 51,520 29,907 

17Related party transactions

Key management personnel are those persons having the authority and responsibility for planning, directing and controlling activities of the entity, directly or indirectly, including the Chief Executive Officer, Chief Financial Officer, Chief Operating Officer, Chief Technology Officer, Chief Corporate Development Officer and other senior officers and Directors.

Compensation expense for the Company’s key management personnel for the three and nine months ended September 30, 2021 and 2020 is as follows:
Three months ended September 30,
Nine months ended September 30,
2021
2020
2021
2020
$$$$
Salaries and benefits916 388 2,824 1,622 
Share-based compensation486 206 1,110 460 
1,402 594 3,934 2,082 



15

DOCEBO INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
September 30, 2021
(expressed in thousands of US dollars, except share amounts)
18Financial instruments and risk management

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from deposits with banks and outstanding receivables. The Company trades only with recognized, creditworthy third parties. Due to the Company’s diversified customer base, there is no particular concentration of credit risk related to the Company’s trade and other receivables. Trade and other receivables are monitored on an ongoing basis to ensure timely collection of amounts. Potential effects from COVID-19 on the Company’s credit risk have been considered and have resulted in increases to its allowances for expected credit losses on customer balances. The Company continues its assessment given the fluidity of COVID-19’s global impact.

The carrying values of cash and cash equivalents, trade and other receivables, trade and other payables and borrowings approximate fair values due to the short-term nature of these items. The items being carried at fair value or the interest rates charged approximate current market rates. The risk of material change in fair value is not considered to be significant. The Company does not use derivative financial instruments to manage this risk.

Contingent consideration is classified as a Level 3 financial instrument. The valuation method and significant assumptions used to determine the fair value of the contingent consideration has been disclosed in Note 4. During the three and nine months ended September 30, 2021, there were no transfers of amounts between levels in the fair value hierarchy.

19Segment information

The Company reports segment information based on internal reports used by the chief operating decision maker (“CODM”) to make operating and resource allocation decisions and to assess performance. The CODM is the Chief Executive Officer. The CODM makes decisions and assesses performance of the Company on a consolidated basis such that the Company is a single reportable operating segment.

The following tables present details on revenues derived in the following geographical locations for the three and nine months ended September 30, 2021 and 2020.

Three months ended September 30,
Nine months ended September 30,
2021
2020
2021
2020
$$$$
North America19,768 11,579 53,907 31,551 
Rest of World
7,300 4,517 20,534 12,610 
27,068 16,096 74,441 44,161 


16