Tradedoubler interim report January – September 2015
First important product launches to support new positioning
The third quarter July - September 2015
- Net sales amounted to SEK 378 M (424), a decrease of 11% or 16% adjusted for changes in exchange rates.
- Gross profit excluding change related items was SEK 79 M (91), a decrease of 13% or 17% adjusted for changes in FX rates.
- Gross margin excluding change related items decreased to 20.9% (21.4%), mainly due to price pressure within affiliate.
- Operating costs, excluding depreciation and change related items, were SEK 82 M (79). This was an increase of 4% or 1% adjusted for changes in exchange rates.
- EBITDA amounted to SEK -3 M (18). Excluding change related items, EBITDA was SEK -3 M (12).
- Capitalised expenses increased to SEK 8 M (3), due to increased product development in line with strategy.
- Earnings per share, before and after dilution, were SEK -0.40 (0.12).
- Cash flow from operating activities was SEK -7 M (30) and the sum of cash and interest-bearing financial assets was SEK 310 M (410) at the end of the period. Net cash decreased by SEK 13 M during the third quarter to SEK 64 M.
- As previously communicated, the loss of a major international client is having a negative impact on net sales in 2015. This is the first quarter during which revenue and gross profit was significantly affected by the loss of this client.
- A new share issue of 3,120,000 C-shares, relating to a long-term incentive program for management, was conducted in accordance with previous AGM decision.
The Interim period January - September 2015
- Net sales were SEK 1,224 M (1,280). Net sales excluding change related items amounted to SEK 1,229 M (1,280), a decrease of 4% or 10% adjusted for changes in exchange rates.
- Gross profit excluding change related items was SEK 252 M (283), a decrease of 11% or 16% adjusted for changes in exchange rates. Gross margin excluding change related items amounted to 20.5% (22.1).
- Operating costs, excluding depreciation and change related items, were SEK 258 M (255). This was an increase of 1% or a decrease of 4% adjusted for changes in exchange rates.
- EBITDA amounted to SEK -20 M (21). EBITDA adjusted for change related items was SEK -6 M (28).
- Cash flow from operating activities amounted to SEK -37 M (-88).
- Earnings per share, before and after dilution, were SEK -1.16 (-0.15).
- Tradedoubler finalised its Nordic regional structure and closed its office in Norway with limited one off costs.
- The German technology company Adnologies was acquired to support the new corporate strategy. The impact from Adnologies upon cash flow, as well as the results were limited during the interim period.
- French media company Reworld Media S.A. acquired 19.1 per cent of Tradedoubler’s share mainly from Monterro 1A AB and thus became the largest shareholder in the company.
- Bertil Lundell, who was appointed as CTO in January 2015, left the company in June.
|FINANCIAL OVERVIEW, SEK M||Jul-Sep
|Net sales excluding change related items||378||424||-10,8%||1 229||1 280||-4,0%||1 743|
|Gross profit excluding change related items||79||91||-13,1%||252||283||-11,0%||379|
|Gross margin (%)||20,9%||21,4%||20,5%||22,1%||21,7%|
|Operating costs excl. depr. and change related costs||-82||-79||4,0%||-258||-255||1,0%||-339|
|EBITDA excluding change related items||-3||12||-6||28||-121,0%||39|
|Change related items 1)||0||6||-14||-6||-20|
|Operating profit (EBIT)||-9||13||-38||5||-63|
|Net investments in non-financial fixed assets (Capitalised development expenses during the period)||-8||-3||-28||-11||-17|
|Cash flow from operating activities||-7||30||-37||-88||-110|
|Liquid assets incl financial investments, at period's end||310||410||310||410||372|
|Net cash 2), at period's end||64||165||64||165||126|
|1) For more information regarding change related items see page 7|
|2) Current investment and liquid assets less interest-bearing liabilities|
CEO MATTHIAS STADELMEYER’S COMMENTS ON THE THIRD QUARTER OF 2015
“During the third quarter, gross profit in our core business Performance marketing – excluding the effects of the loss of one larger international customer – decreased roughly in line with the year-on-year trend of the previous quarter. However, the development within different markets varied considerably due to underlying market trends and our own performance. In the third quarter, we saw good results particularly in Sweden and Poland, which both grew year-on-year gross profit in local currency, while France and Switzerland were more challenging.
We are making good progress with the development of new solutions that will enable us to expand our addressable market. Our new performance marketing solution has been running in Germany, Sweden, Spain and Italy since August and has a dedicated group of 10 employees. At the end of October, 20 customers were testing this beta product with encouraging initial results on click-through and conversion rates. We are refining our offering as we roll it out and scale it further with more clients and will launch a full commercial product during the first half of 2016.
During the third quarter we launched Cookieless Tracking and in October User Journey Reporting within ADAPT. Cookieless Tracking increases the accuracy and reliability of our tracking, ensuring the best results for our clients. User Journey Reporting is a groundbreaking new solution that enables our clients to optimise their digital marketing activity and generate a higher ROI. No other performance marketing company is currently able to deliver such detailed insight into the online behaviour of customers.
These product launches will create smarter results for our clients and, together with a strengthened sales force, improve results for Tradedoubler.”
This interim report will be presented at a teleconference on the 12th of November 2015 at 10.00 a.m. CET. To follow the presentation, please dial (SE) +46 8 566 426 61, (UK) +44 203 428 14 10 or (US) +1 646 502 51 17. The presentation may also be followed via webcast using the link: http://financials.tradedoubler.com/en-gb/investorrelations
Tradedoubler discloses the information provided herein pursuant to the Swedish Securities Markets Act. The information was released for publication on the 12th of November 2015 at 08.00 a.m. CET. Numerical data in brackets refers to the corresponding periods in 2014 unless otherwise stated. Rounding off differences may arise.