NEW YORK, May 5, 2021 /PRNewswire/ -- Criteo S.A. (NASDAQ:
CRTO), the global technology company powering the world's marketers
with trusted and impactful advertising, today announced financial
results for the first quarter ended March 31, 2021 that
exceeded the Company's quarterly guidance.
First Quarter 2021 Financial Highlights:
The following table summarizes our consolidated financial
results for the three months ended March 31,
2021 and 2020:
|
Three Months
Ended
|
|
March
31,
|
|
2021
|
|
2020
|
|
YoY
Change
|
|
(in millions,
except EPS data)
|
GAAP
Results
|
|
|
|
|
|
Revenue
|
$
|
541
|
|
|
$
|
503
|
|
|
7
|
%
|
Net Income
|
$
|
23
|
|
|
$
|
16
|
|
|
43
|
%
|
Diluted
EPS
|
$
|
0.35
|
|
|
$
|
0.25
|
|
|
40
|
%
|
Cash from operating
activities
|
$
|
77
|
|
|
$
|
57
|
|
|
36
|
%
|
Net cash
position
|
$
|
520
|
|
|
$
|
437
|
|
|
19
|
%
|
|
|
|
|
|
|
Non-GAAP
Results1
|
|
|
|
|
|
Revenue
ex-TAC
|
$
|
213
|
|
|
$
|
206
|
|
|
4
|
%
|
Revenue ex-TAC
margin
|
39
|
%
|
|
41
|
%
|
|
(2)
|
%
|
Adjusted
EBITDA
|
$
|
76
|
|
|
$
|
59
|
|
|
28
|
%
|
Adjusted diluted
EPS
|
$
|
0.67
|
|
|
$
|
0.52
|
|
|
29
|
%
|
Free Cash Flow
(FCF)
|
$
|
64
|
|
|
$
|
45
|
|
|
41
|
%
|
FCF / Adjusted
EBITDA
|
84
|
%
|
|
76
|
%
|
|
8
|
%
|
Megan Clarken, Chief Executive
Officer of Criteo, said, "Our commitments to deliver measurable
results for our customers, our growth investments and our
consistent focus on execution and productivity enabled us to
deliver strong top line and margin."
Q1 2021 Operating Highlights
- New solutions grew 60% year-over-year at constant
currency2 to 21% of total Revenue ex-TAC.
- Retail Media revenue grew 69% year-over-year at constant
currency2 and Retail Media Revenue ex-TAC grew 122% at
constant currency2. Same-client revenue3 for
Retail Media grew 61% and same-client Revenue ex-TAC3
for Retail Media increased 89% year-over-year.
- Criteo launched its contextual advertising solution, a
first-of-its-kind product that connects first-party commerce data
with real-time contextual signals, paving the way for marketers to
continue to drive and measure incremental revenue in a post-cookie
world.
- Same-client revenue3 increased 8% year-over-year,
accelerating vs. Q4 2020, and same-client Revenue
ex-TAC3 increased 3% year-over-year at constant
currency2.
- We added over 120 net new live clients in Q1 2021 and closed
the quarter with 20,626 clients4.
___________________________________________________
1 Revenue excluding Traffic Acquisition Costs, or
Revenue ex-TAC, Revenue ex-TAC margin, Adjusted EBITDA, Adjusted
EBITDA at constant currency, Adjusted EBITDA margin, Adjusted
diluted EPS, Free Cash Flow and growth at constant currency are not
measures calculated in accordance with U.S. GAAP.
2Constant currency measures exclude the impact of
foreign currency fluctuations and is computed by applying the 2020
average exchange rates for the relevant period to 2021 figures.
3Same-client revenue or Revenue ex-TAC is the revenue or
Revenue ex-TAC generated by clients that were live with us in a
given quarter and still live with us the same quarter in the
following year.
4Our client metric, which is a lagging indicator
counting all clients that have been live over the preceding 12
months, in Q1 2021 reflected the annualized impact of client churn
that peaked in Q2 2020 when COVID started to impact the global
economy.
Financial Summary
Revenue for Q1 2021 was $541
million and Revenue ex-TAC was $213
million. Adjusted EBITDA for the quarter was $76 million, resulting in an adjusted diluted EPS
of $0.67. At constant currency, Q1
2021 Revenue increased by 4% and Revenue ex-TAC increased by 0.5%.
Excluding the estimated $18 million
incremental impact of the pandemic, we estimate that Revenue ex-TAC
increased about 9% in Q1 2021. Free Cash Flow was $64 million in Q1 2021, up 41% year-over-year.
Free Cash Flow conversion was 84% of Adjusted EBITDA in Q1 2021,
representing the highest quarterly level for the past 21 quarters.
We had $566 million in cash and
marketable securities on our balance sheet at the end of Q1
2021.
Sarah Glickman, Chief Financial
Officer, said, "We are on track to achieve about 50% growth from
our new solutions in 2021, and excited to deliver value to newly
signed customers in Retail Media and for our newly launched
Contextual advertising product."
Revenue and Revenue ex-TAC
Revenue increased by 7% year-over-year in Q1 2021, or 4% at
constant currency, to $541 million (Q1 2020:
$503 million). Revenue ex-TAC in the quarter increased 4%
year-over-year, or 0.5% at constant currency, to $213 million
(Q1 2020: $206 million), after an approximately
$18 million net negative impact from
the COVID-19 disruption incremental to 2020, or approximately 9
points of year-over-over growth at constant currency. Good
performance of retargeting, driven by our retail clients, stellar
performance of Retail Media and continued growth of our Audience
Targeting and Omnichannel solutions offset Q1 2021 COVID-19
pandemic impact, in particular on our travel clients. Revenue
ex-TAC as a percentage of revenue, or Revenue ex-TAC margin, was
39% (Q1 2020: 41%).
- In the Americas, Revenue increased 6% year-over-year, or 8% at
constant currency, to $204 million
and represented 38% of total Revenue. Revenue ex-TAC increased 6%
year-over-year, or 8% at constant currency, to $76 million and represented 36% of total Revenue
ex-TAC.
- In EMEA, Revenue increased 12% year-over-year, or 4% at
constant currency, to $212 million
and represented 39% of total Revenue. Revenue ex-TAC increased 5%
year-over-year, or decreased 2% at constant currency, to
$85 million and represented 40% of
total Revenue ex-TAC.
- In Asia-Pacific, Revenue
increased 3% year-over-year, or declined 1% at constant currency,
to $125 million and represented 23%
of total Revenue. Revenue ex-TAC declined 2% year-over-year, or 5%
at constant currency, to $52 million
and represented 24% of total Revenue ex-TAC.
Net Income and Adjusted Net Income
Net income increased 43% year-over-year in Q1 2021 to
$23 million (Q1 2020: $16 million). Net income
margin as a percentage of revenue was 4% (Q1 2020: 3%). In the
quarter, we incurred $12 million in
restructuring related and transformation costs. Net income
available to shareholders of Criteo S.A. increased 45%
year-over-year to $22 million, or $0.35 per share on a diluted basis (Q1 2020:
$15 million, or $0.25 per share
on a diluted basis).
Adjusted Net Income, or net income adjusted to eliminate the
impact of equity awards compensation expense, amortization of
acquisition-related intangible assets, restructuring related and
transformation costs and the tax impact of these adjustments,
increased 35% year-over-year to $43 million, or $0.67 per share on a diluted basis (Q1 2020:
$32 million, or $0.52 per share
on a diluted basis).
Adjusted EBITDA and Operating Expenses
Adjusted EBITDA increased 28% year-over-year, or 21% at constant
currency, to $76 million (Q1 2020: $59 million),
driven by the Revenue ex-TAC performance over the period and
effective cost discipline balanced with investments in our growth
areas. Adjusted EBITDA as a percentage of Revenue ex-TAC, or
Adjusted EBITDA margin, was 36% (Q1 2020: 29%).
Operating expenses decreased by 3% or $4
million, to $144 million (Q1 2020:
$148 million), mostly driven by lower headcount-related
expense and disciplined expense management across the Company.
Operating expenses, excluding the impact of equity awards
compensation expense, pension costs, restructuring related and
transformation costs, and depreciation and amortization, which we
refer to as Non-GAAP Operating Expenses, decreased 6% or
$8 million, to $118 million
(Q1 2020: $126 million), largely
driven by lower headcount and effective cost discipline, after
investing in the growth areas of the Company.
Cash Flow, Cash and Financial Liquidity Position
Cash flow from operating activities increased 36% year-over-year
to $77 million (Q1 2020: $57 million).
Free Cash Flow, defined as cash flow from operating activities
less acquisition of intangible assets, property, plant and
equipment and change in accounts payable related to intangible
assets, property, plant and equipment, increased 41% to
$64 million (Q1 2020: $45 million), or 84% of
Adjusted EBITDA (Q1 2020: 76%), driven by our Adjusted EBITDA
performance over the period and positive working capital.
Cash and cash equivalents increased $32
million compared to December 31,
2020 to $520 million, after spending $5 million on share repurchases in the first
quarter 2021.
As of March 31, 2021, the Company
had total financial liquidity of approximately $1 billion, including its cash position,
marketable securities, Revolving Credit Facility and treasury
shares reserved for M&A.
Business Outlook
The following forward-looking statements reflect Criteo's
expectations as of May 5, 2021.
Second quarter 2021 guidance:
- We expect Revenue ex-TAC to be approximately $208 million, translating into constant-currency
growth of about 14% year-over-year.
- We expect Adjusted EBITDA to be approximately $60 million.
Fiscal year 2021 guidance:
- We maintain our target of low to mid-single digit growth in
Revenue ex-TAC at constant-currency.
- We maintain our expectation of an Adjusted EBITDA margin above
30% of Revenue ex-TAC.
The above guidance for the second quarter and the fiscal year
ending December 31, 2021 assumes the
following exchange rates for the main currencies impacting our
business: a U.S. dollar-euro rate of 0.847, a U.S. dollar-Japanese
Yen rate of 108, a U.S. dollar-British pound rate of 0.746, a U.S.
dollar-Korean Won rate of 1,150 and a U.S. dollar-Brazilian real
rate of 5.70.
The above guidance assumes no acquisitions are completed during
the second quarter ending June 30, 2021 and fiscal year ended
December 31, 2021.
Reconciliation of Revenue ex-TAC and Adjusted EBITDA guidance to
the closest corresponding U.S. GAAP measure is not available
without unreasonable efforts on a forward-looking basis due to the
high variability, complexity and low visibility with respect to the
charges excluded from these non-GAAP measures; in particular, the
measures and effects of equity awards compensation expense specific
to equity compensation awards that are directly impacted by
unpredictable fluctuations in our share price. The variability of
the above charges could potentially have a significant impact on
our future U.S. GAAP financial results.
Investor Day 2021
Criteo will hold a virtual investor day on Thursday, June 3rd, 2021. More details
will be provided ahead of the event, which will be webcast live, on
the Company's Investor Relations website http://ir.criteo.com.
Non-GAAP Financial Measures
This press release and its attachments include the following
financial measures defined as non-GAAP financial measures by the
U.S. Securities and Exchange Commission ("SEC"): Revenue ex-TAC,
Revenue ex-TAC by Region, Revenue ex-TAC by Solution, Revenue
ex-TAC margin, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted
Net Income, Adjusted diluted EPS, Free Cash Flow and Non-GAAP
Operating Expenses. These measures are not calculated in accordance
with U.S. GAAP.
Revenue ex-TAC is our revenue excluding Traffic Acquisition
Costs ("TAC") generated over the applicable measurement period and
Revenue ex-TAC by Region reflects our Revenue ex-TAC by our
geographies. Revenue ex-TAC, Revenue ex-TAC by Region, Revenue
ex-TAC by Solution, and Revenue ex-TAC margin are key measures used
by our management and board of directors to evaluate our operating
performance, generate future operating plans and make strategic
decisions regarding the allocation of capital. In particular, we
believe that the elimination of TAC from revenue can provide a
useful measure for period-to-period comparisons of our business and
across our geographies.
Accordingly, we believe that Revenue ex-TAC, Revenue ex-TAC by
Region, Revenue ex-TAC by Solution and Revenue ex-TAC margin
provide useful information to investors and the market generally in
understanding and evaluating our operating results in the same
manner as our management and board of directors.
Adjusted EBITDA is our consolidated earnings before financial
income (expense), income taxes, depreciation and amortization,
adjusted to eliminate the impact of equity awards compensation
expense, pension service costs and restructuring related and
transformation costs.
Adjusted EBITDA and Adjusted EBITDA margin are key measures used
by our management and board of directors to understand and evaluate
our core operating performance and trends, to prepare and approve
our annual budget and to develop short- and long-term operational
plans. In particular, we believe that by eliminating equity awards
compensation expense, pension service costs and restructuring
related and transformation costs, Adjusted EBITDA and Adjusted
EBITDA margin can provide useful measures for period-to-period
comparisons of our business. Accordingly, we believe that Adjusted
EBITDA and Adjusted EBITDA margin provide useful information to
investors and the market generally in understanding and evaluating
our results of operations in the same manner as our management and
board of directors.
Adjusted Net Income is our net income adjusted to eliminate the
impact of equity awards compensation expense, amortization of
acquisition-related intangible assets, restructuring related and
transformation costs and the tax impact of these adjustments.
Adjusted Net Income and Adjusted diluted EPS are key measures used
by our management and board of directors to evaluate operating
performance, generate future operating plans and make strategic
decisions regarding the allocation of capital.
In particular, we believe that by eliminating equity awards
compensation expense, amortization of acquisition-related
intangible assets, restructuring related and transformation costs
and the tax impact of these adjustments, Adjusted Net Income and
Adjusted diluted EPS can provide useful measures for
period-to-period comparisons of our business. Accordingly, we
believe that Adjusted Net Income and Adjusted diluted EPS provide
useful information to investors and the market generally in
understanding and evaluating our results of operations in the same
manner as our management and board of directors.
Free Cash Flow is defined as cash flow from operating activities
less acquisition of intangible assets, property, plant and
equipment and change in accounts payable related to intangible
assets, property, plant and equipment. Free Cash Flow
Conversion is defined as free cash flow divided by Adjusted EBITDA.
Free Cash Flow and Free Cash Flow Conversion are key measures used
by our management and board of directors to evaluate the Company's
ability to generate cash. Accordingly, we believe that Free Cash
Flow and Free Cash Flow Conversion permit a more complete and
comprehensive analysis of our available cash flows.
Non-GAAP Operating Expenses are our consolidated operating
expenses adjusted to eliminate the impact of depreciation and
amortization, equity awards compensation expense, pension service
costs, and restructuring related and transformation costs. The
Company uses Non-GAAP Operating Expenses to understand and compare
operating results across accounting periods, for internal budgeting
and forecasting purposes, for short-term and long-term operational
plans, and to assess and measure our financial performance and the
ability of our operations to generate cash. We believe Non-GAAP
Operating Expenses reflects our ongoing operating expenses in a
manner that allows for meaningful period-to-period comparisons and
analysis of trends in our business. As a result, we believe that
Non-GAAP Operating Expenses provides useful information to
investors in understanding and evaluating our core operating
performance and trends in the same manner as our management and in
comparing financial results across periods. In addition, Non-GAAP
Operating Expenses is a key component in calculating Adjusted
EBITDA, which is one of the key measures the Company uses to
provide its quarterly and annual business outlook to the investment
community.
Please refer to the supplemental financial tables provided in
the appendix of this press release for a reconciliation of Revenue
ex-TAC to revenue, Revenue ex-TAC by Region to revenue by region,
Revenue ex-TAC by Solution to revenue by solution, Adjusted EBITDA
to net income, Adjusted Net Income to net income, Free Cash Flow to
cash flow from operating activities, and Non-GAAP Operating
Expenses to operating expenses, in each case, the most comparable
U.S. GAAP measure. Our use of non-GAAP financial measures has
limitations as an analytical tool, and you should not consider such
non-GAAP measures in isolation or as a substitute for analysis of
our financial results as reported under U.S. GAAP. Some of these
limitations are: 1) other companies, including companies in our
industry which have similar business arrangements, may address the
impact of TAC differently; and 2) other companies may report
Revenue ex-TAC, Revenue ex-TAC by Region, Revenue ex-TAC by
Solution, Adjusted EBITDA, Adjusted Net Income, Free Cash Flow,
Non-GAAP Operating Expenses or similarly titled measures but
calculate them differently or over different regions, which reduces
their usefulness as comparative measures. Because of these and
other limitations, you should consider these measures alongside our
U.S. GAAP financial results, including revenue and net income.
Forward-Looking Statements Disclosure
This press release contains forward-looking statements,
including projected financial results for the quarter ending June
30, 2021 and the year ended December
31, 2021, our expectations regarding our market opportunity
and future growth prospects and other statements that are not
historical facts and involve risks and uncertainties that could
cause actual results to differ materially. Factors that might cause
or contribute to such differences include, but are not limited to:
failure related to our technology and our ability to innovate and
respond to changes in technology, uncertainty regarding the scope
and impact of the COVID-19 pandemic on our employees, operations,
revenue and cash flows, uncertainty regarding our ability to access
a consistent supply of internet display advertising inventory and
expand access to such inventory, including without limitation
uncertainty regarding the timing and scope of proposed changes to
and enhancements of the Chrome browser announced by Google,
investments in new business opportunities and the timing of these
investments, whether the projected benefits of acquisitions
materialize as expected, uncertainty regarding international growth
and expansion, the impact of competition, uncertainty regarding
legislative, regulatory or self-regulatory developments regarding
data privacy matters and the impact of efforts by other
participants in our industry to comply therewith, the impact of
consumer resistance to the collection and sharing of data, our
ability to access data through third parties, failure to enhance
our brand cost-effectively, recent growth rates not being
indicative of future growth, our ability to manage growth,
potential fluctuations in operating results, our ability to grow
our base of clients, and the financial impact of maximizing Revenue
ex-TAC, as well as risks related to future opportunities and plans,
including the uncertainty of expected future financial performance
and results and those risks detailed from time-to-time under the
caption "Risk Factors" and elsewhere in the Company's SEC filings
and reports, including the Company's Annual Report on Form 10-K
filed with the SEC on February 26, 2021, and in
subsequent Quarterly Reports on Form 10-Q as well as future filings
and reports by the Company. Importantly, at this time, the COVID-19
pandemic continues to have a significant impact on Criteo's
business, financial condition, cash flow and results of operations.
There are significant uncertainties about the duration and the
extent of the impact of the virus.
Except as required by law, the Company undertakes no duty or
obligation to update any forward-looking statements contained in
this release as a result of new information, future events, changes
in expectations or otherwise.
Conference Call Information
Criteo's senior management team will discuss the Company's
earnings on a call that will take place today, May 5, 2021, at 8:00 AM ET,
2:00 PM CET. The conference call will be
webcast live on the Company's website http://ir.criteo.com
and will be available for replay.
- U.S.
callers:
+1 855 209 8212
- International callers: +1 412 317 0788 or +33 1 76
74 05 02
Please ask to be joined into the "Criteo S.A." call.
About Criteo
Criteo (NASDAQ: CRTO) is the global technology company powering
the world's marketers with trusted and impactful advertising. 2,500
Criteo team members partner with over 20,000 customers and
thousands of publishers around the globe to deliver effective
advertising across all channels, by applying advanced machine
learning to unparalleled data sets. Criteo empowers companies of
all sizes with the technology they need to better know and serve
their customers. For more information, please visit
www.criteo.com.
Contacts
Criteo Investor Relations
Edouard Lassalle, SVP, Market Relations &
Capital Markets, e.lassalle@criteo.com
Clemence Vermersch, Director,
Investor Relations, c.vermersch@criteo.com
Criteo Public Relations
Jessica Meyers, Director,
Public Relations, Americas, j.meyers@criteo.com
Financial information to follow
CRITEO
S.A. Consolidated Statement of Financial
Position (U.S. dollars in thousands,
unaudited)
|
|
|
|
March 31,
2021
|
|
December 31,
2020
|
Assets
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
520,060
|
|
|
$
|
488,011
|
|
Trade
receivables, net of allowances of $38.7 million and $39.9 million
at March 31, 2021 and December 31, 2020,
respectively
|
|
416,910
|
|
|
474,055
|
|
Income
taxes
|
|
12,750
|
|
|
11,092
|
|
Other taxes
|
|
69,692
|
|
|
69,987
|
|
Other current
assets
|
|
22,494
|
|
|
21,405
|
|
Marketable Securities
- current portion
|
|
17,586
|
|
|
—
|
|
Total current
assets
|
|
1,059,492
|
|
|
1,064,550
|
|
Property, plant and
equipment, net
|
|
168,036
|
|
|
189,505
|
|
Intangible assets,
net
|
|
79,440
|
|
|
79,744
|
|
Goodwill
|
|
322,821
|
|
|
325,805
|
|
Right of Use Asset -
operating lease
|
|
96,266
|
|
|
114,012
|
|
Marketable securities
- non current portion
|
|
28,281
|
|
|
41,809
|
|
Non-current financial
assets
|
|
14,788
|
|
|
18,109
|
|
Deferred tax
assets
|
|
13,511
|
|
|
19,876
|
|
Total non-current assets
|
|
723,143
|
|
|
788,860
|
|
Total
assets
|
|
$
|
1,782,635
|
|
|
$
|
1,853,410
|
|
|
|
|
|
|
Liabilities and
shareholders' equity
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Trade
payables
|
|
$
|
347,209
|
|
|
$
|
367,025
|
|
Contingencies
|
|
1,773
|
|
|
2,250
|
|
Income
taxes
|
|
1,201
|
|
|
2,626
|
|
Financial liabilities
- current portion
|
|
2,114
|
|
|
2,889
|
|
Lease liability -
operating - current portion
|
|
44,501
|
|
|
48,388
|
|
Other taxes
|
|
56,192
|
|
|
58,491
|
|
Employee - related
payables
|
|
71,450
|
|
|
85,272
|
|
Other current
liabilities
|
|
32,693
|
|
|
33,390
|
|
Total current
liabilities
|
|
557,133
|
|
|
600,331
|
|
Deferred tax
liabilities
|
|
4,066
|
|
|
5,297
|
|
Retirement benefit
obligation
|
|
5,621
|
|
|
6,167
|
|
Financial liabilities
- non-current portion
|
|
371
|
|
|
386
|
|
Lease liability -
operating - non-current portion
|
|
61,874
|
|
|
83,007
|
|
Other non-current
liabilities
|
|
9,807
|
|
|
5,535
|
|
Total non-current liabilities
|
|
81,739
|
|
|
100,392
|
|
Total
liabilities
|
|
638,872
|
|
|
700,723
|
|
Commitments and
contingencies
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
Common shares, €0.025
par value, 66,391,906 and 66,272,106 shares authorized,
issued and outstanding at March 31, 2021 and December 31, 2020,
respectively.
|
|
2,164
|
|
|
2,161
|
|
Treasury stock,
5,597,601 and 5,632,536 shares at cost as of March 31, 2021
and December 31, 2020, respectively.
|
|
(87,263)
|
|
|
(85,570)
|
|
Additional paid-in
capital
|
|
702,022
|
|
|
693,164
|
|
Accumulated other
comprehensive income (loss)
|
|
(17,825)
|
|
|
16,028
|
|
Retained
earnings
|
|
510,528
|
|
|
491,359
|
|
Equity - attributable
to shareholders of Criteo S.A.
|
|
1,109,626
|
|
|
1,117,142
|
|
Non-controlling
interests
|
|
34,137
|
|
|
35,545
|
|
Total
equity
|
|
1,143,763
|
|
|
1,152,687
|
|
Total equity and
liabilities
|
|
$
|
1,782,635
|
|
|
$
|
1,853,410
|
|
CRITEO S.A.
Consolidated Statement of Income
(U.S. dollars in thousands, except share and per share data,
unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
|
March
31,
|
|
|
|
|
2021
|
|
2020
|
|
YoY
Change
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
541,077
|
|
|
$
|
503,376
|
|
|
7
|
%
|
|
|
|
|
|
|
|
Cost of
revenue
|
|
|
|
|
|
|
Traffic acquisition
cost
|
|
(327,667)
|
|
|
(297,364)
|
|
|
10
|
%
|
Other cost of
revenue
|
|
(34,712)
|
|
|
(33,806)
|
|
|
3
|
%
|
|
|
|
|
|
|
|
Gross
profit
|
|
178,698
|
|
|
172,206
|
|
|
4
|
%
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
Research and
development expenses
|
|
(31,697)
|
|
|
(37,515)
|
|
|
(16)
|
%
|
Sales and operations
expenses
|
|
(79,354)
|
|
|
(84,974)
|
|
|
(7)
|
%
|
General and
administrative expenses
|
|
(33,428)
|
|
|
(25,915)
|
|
|
29
|
%
|
Total Operating
expenses
|
|
(144,479)
|
|
|
(148,404)
|
|
|
(3)
|
%
|
Income from
operations
|
|
34,219
|
|
|
23,802
|
|
|
44
|
%
|
Financial
expense
|
|
(718)
|
|
|
(334)
|
|
|
NM
|
Income before
taxes
|
|
33,501
|
|
|
23,468
|
|
|
43
|
%
|
Provision for income
taxes
|
|
(10,051)
|
|
|
(7,040)
|
|
|
43
|
%
|
Net Income
|
|
$
|
23,450
|
|
|
$
|
16,428
|
|
|
43
|
%
|
|
|
|
|
|
|
|
Net income available
to shareholders of Criteo S.A.
|
|
$
|
22,406
|
|
|
$
|
15,459
|
|
|
45
|
%
|
Net income available
to non-controlling interests
|
|
$
|
1,044
|
|
|
$
|
969
|
|
|
8
|
%
|
|
|
|
|
|
|
|
Weighted average
shares outstanding used in computing per share amounts:
|
|
|
|
|
|
|
Basic
|
|
60,741,674
|
|
|
61,691,001
|
|
|
|
Diluted
|
|
64,077,409
|
|
|
62,125,582
|
|
|
|
|
|
|
|
|
|
|
Net income allocated
to shareholders per share:
|
|
|
|
|
|
|
Basic
|
|
$
|
0.37
|
|
|
$
|
0.25
|
|
|
48
|
%
|
Diluted
|
|
$
|
0.35
|
|
|
$
|
0.25
|
|
|
40
|
%
|
CRITEO
S.A. Consolidated Statement of Cash Flows (U.S.
dollars in thousands, unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
|
March
31,
|
|
|
|
|
2021
|
|
2020
|
|
YoY
Change
|
Net
income
|
|
$
|
23,450
|
|
|
$
|
16,428
|
|
|
43
|
%
|
Non-cash and
non-operating items
|
|
30,017
|
|
|
32,828
|
|
|
(9)
|
%
|
- Amortization and provisions
|
|
17,225
|
|
|
27,044
|
|
|
(36)
|
%
|
- Equity awards compensation expense (1)
|
|
7,215
|
|
|
8,502
|
|
|
(15)
|
%
|
- Net gain or (loss) on disposal of non-current assets
|
|
3,945
|
|
|
2,266
|
|
|
74
|
%
|
- Change in deferred taxes
|
|
4,998
|
|
|
(2,678)
|
|
|
NM
|
|
- Change in income taxes
|
|
(3,379)
|
|
|
(2,329)
|
|
|
45
|
%
|
- Other
|
|
13
|
|
|
23
|
|
|
(43)
|
%
|
Changes in working
capital related to operating activities
|
|
23,895
|
|
|
7,487
|
|
|
NM
|
|
- (Increase) / Decrease in trade receivables
|
|
47,226
|
|
|
99,388
|
|
|
(52)
|
%
|
- Increase / (Decrease) in trade payables
|
|
(10,640)
|
|
|
(81,679)
|
|
|
(87)
|
%
|
- (Increase) / Decrease in other current assets
|
|
(5,050)
|
|
|
(10,398)
|
|
|
(51)
|
%
|
- Increase / (Decrease) in other current liabilities
|
|
(4,527)
|
|
|
(945)
|
|
|
NM
|
|
- Change in operating lease liabilities and right of use
assets
|
|
(3,114)
|
|
|
1,121
|
|
|
NM
|
|
CASH FROM
OPERATING ACTIVITIES
|
|
77,362
|
|
|
56,743
|
|
|
36
|
%
|
Acquisition of
intangible assets, property, plant and equipment
|
|
(11,953)
|
|
|
(11,258)
|
|
|
6
|
%
|
Change in accounts
payable related to intangible assets, property, plant and
equipment
|
|
(1,827)
|
|
|
(479)
|
|
|
NM
|
|
Change in other
non-current financial assets
|
|
(3,252)
|
|
|
889
|
|
|
NM
|
|
CASH USED FOR
INVESTING ACTIVITIES
|
|
(17,032)
|
|
|
(10,848)
|
|
|
57
|
%
|
Repayment of
borrowings
|
|
(182)
|
|
|
(170)
|
|
|
7
|
%
|
Proceeds from capital
increase
|
|
2,074
|
|
|
4
|
|
|
NM
|
|
Repurchase of
treasury stocks
|
|
(4,930)
|
|
|
(18,241)
|
|
|
(73)
|
%
|
Change in other
financial liabilities
|
|
(378)
|
|
|
(354)
|
|
|
7
|
%
|
CASH USED FOR
FINANCING ACTIVITIES
|
|
(3,416)
|
|
|
(18,761)
|
|
|
(82)
|
%
|
Effect of exchange
rates changes on cash and cash equivalents
|
|
(24,865)
|
|
|
(9,391)
|
|
|
NM
|
|
Net increase
(decrease) in cash and cash equivalents
|
|
32,049
|
|
|
17,743
|
|
|
81
|
%
|
Net cash and cash
equivalents at beginning of period
|
|
488,011
|
|
|
418,763
|
|
|
17
|
%
|
Net cash and cash
equivalents at end of period
|
|
$
|
520,060
|
|
|
$
|
436,506
|
|
|
19
|
%
|
|
|
|
|
|
|
|
SUPPLEMENTAL
DISCLOSURES OF CASH FLOW INFORMATION
|
|
|
|
|
|
|
Cash paid for taxes,
net of refunds
|
|
$
|
(8,432)
|
|
|
$
|
(12,047)
|
|
|
(30)
|
%
|
Cash paid for
interest
|
|
$
|
(367)
|
|
|
$
|
(349)
|
|
|
5
|
%
|
|
(1) Share-based compensation expense
according to ASC 718 Compensation - stock compensation accounted
for $6.8 million and $8.1 million of equity awards
compensation expense for the quarter ended March 31, 2021 and
2020, respectively
|
CRITEO
S.A. Reconciliation of Cash from Operating Activities to
Free Cash Flow (U.S. dollars in thousands,
unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
|
March
31,
|
|
|
|
|
2021
|
|
2020
|
|
YoY
Change
|
|
|
|
|
|
|
|
CASH FROM OPERATING
ACTIVITIES
|
|
$
|
77,362
|
|
|
$
|
56,743
|
|
|
36
|
%
|
Acquisition of
intangible assets, property, plant and equipment
|
|
(11,953)
|
|
|
(11,258)
|
|
|
6
|
%
|
Change in accounts
payable related to intangible assets, property, plant and
equipment
|
|
(1,827)
|
|
|
(479)
|
|
|
NM
|
|
FREE CASH FLOW
(1)
|
|
$
|
63,582
|
|
|
$
|
45,006
|
|
|
41
|
%
|
|
(1) Free Cash Flow is defined as cash
flow from operating activities less acquisition of intangible
assets, property, plant and equipment and change in accounts
payable related to intangible assets, property, plant and
equipment.
|
CRITEO
S.A. Reconciliation of Revenue ex-TAC to Revenue
(U.S. dollars in thousands, unaudited)
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
|
March
31,
|
|
|
|
|
|
Region
|
|
2021
|
|
2020
|
|
YoY
Change
|
|
YoY Change
at Constant
Currency
|
Revenue
|
|
|
|
|
|
|
|
|
|
Americas
|
|
$
|
203,900
|
|
|
$
|
191,745
|
|
|
6
|
%
|
|
8
|
%
|
|
EMEA
|
|
212,096
|
|
|
190,114
|
|
|
12
|
%
|
|
4
|
%
|
|
Asia-Pacific
|
|
125,081
|
|
|
121,517
|
|
|
3
|
%
|
|
(1)
|
%
|
|
Total
|
|
541,077
|
|
|
503,376
|
|
|
7
|
%
|
|
4
|
%
|
|
|
|
|
|
|
|
|
|
|
Traffic acquisition
costs (1)
|
|
|
|
|
|
|
|
|
|
Americas
|
|
(127,628)
|
|
|
(120,022)
|
|
|
6
|
%
|
|
7
|
%
|
|
EMEA
|
|
(126,648)
|
|
|
(108,397)
|
|
|
17
|
%
|
|
9
|
%
|
|
Asia-Pacific
|
|
(73,391)
|
|
|
(68,945)
|
|
|
6
|
%
|
|
2
|
%
|
|
Total
|
|
(327,667)
|
|
|
(297,364)
|
|
|
10
|
%
|
|
7
|
%
|
|
|
|
|
|
|
|
|
|
|
Revenue ex-TAC
(1)
|
|
|
|
|
|
|
|
|
|
Americas
|
|
76,272
|
|
|
71,723
|
|
|
6
|
%
|
|
8
|
%
|
|
EMEA
|
|
85,448
|
|
|
81,717
|
|
|
5
|
%
|
|
(2)
|
%
|
|
Asia-Pacific
|
|
51,690
|
|
|
52,572
|
|
|
(2)
|
%
|
|
(5)
|
%
|
|
Total
|
|
$
|
213,410
|
|
|
$
|
206,012
|
|
|
4
|
%
|
|
0.5
|
%
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
|
March
31,
|
|
|
|
|
|
Solution
|
|
2021
|
|
2020
|
|
YoY
Change
|
|
YoY Change
at Constant
Currency
|
Revenue
|
|
|
|
|
|
|
|
|
|
Marketing
Solutions
|
|
$
|
483,190
|
|
|
$
|
469,773
|
|
|
3
|
%
|
|
(0.5)
|
%
|
|
Retail Media
(2)
|
|
57,887
|
|
|
33,603
|
|
|
72
|
%
|
|
69
|
%
|
|
Total
|
|
541,077
|
|
|
503,376
|
|
|
7
|
%
|
|
4
|
%
|
|
|
|
|
|
|
|
|
|
|
Traffic acquisition
costs (1)
|
|
|
|
|
|
|
|
|
|
Marketing
Solutions
|
|
(290,873)
|
|
|
(273,057)
|
|
|
7
|
%
|
|
3
|
%
|
|
Retail Media
(2)
|
|
(36,794)
|
|
|
(24,307)
|
|
|
51
|
%
|
|
49
|
%
|
|
Total
|
|
(327,667)
|
|
|
(297,364)
|
|
|
10
|
%
|
|
7
|
%
|
|
|
|
|
|
|
|
|
|
|
Revenue ex-TAC
(1)
|
|
|
|
|
|
|
|
|
|
Marketing
Solutions
|
|
192,317
|
|
|
196,716
|
|
|
(2)
|
%
|
|
(5)
|
%
|
|
Retail Media
(2)
|
|
21,093
|
|
|
9,296
|
|
|
127
|
%
|
|
122
|
%
|
|
Total
|
|
$
|
213,410
|
|
|
$
|
206,012
|
|
|
4
|
%
|
|
0.5
|
%
|
|
(1) We define Revenue ex-TAC as our
revenue excluding traffic acquisition costs generated over the
applicable measurement period. Revenue ex-TAC, Traffic Acquisition
Costs, Revenue ex-TAC by Region and Revenue ex-TAC by Solution are
not measures calculated in accordance with U.S. GAAP. We have
included Revenue ex-TAC, Traffic Acquisition Costs, Revenue
ex-TAC by Region and Revenue ex-TAC by Solution because they are
key measures used by our management and board of directors to
evaluate operating performance, generate future operating plans and
make strategic decisions regarding the allocation of capital. In
particular, we believe that the elimination of TAC from revenue and
review of these measures by region and solution can provide useful
measures for period-to-period comparisons of our business.
Accordingly, we believe that Revenue ex-TAC, Traffic Acquisition
Costs, Revenue ex-TAC by Region, and Revenue ex-TAC by Solution
provide useful information to investors and others in understanding
and evaluating our results of operations in the same manner as our
management and board of directors. Our use of Revenue ex-TAC,
Traffic Acquisition Costs, Revenue ex-TAC by Region and Revenue
ex-TAC by Solution has limitations as an analytical tool, and you
should not consider them in isolation or as a substitute for
analysis of our financial results as reported under U.S. GAAP. Some
of these limitations are: (a) other companies, including companies
in our industry which have similar business arrangements, may
address the impact of TAC differently; (b) other companies may
report Revenue, Traffic Acquisition Costs, Revenue ex-TAC by
Region and Revenue ex-TAC by Solution, or similarly titled measures
but define the regions, and product families differently, which
reduces their effectiveness as a comparative measure; and (c) other
companies may report Revenue ex-TAC or similarly titled measures
but calculate them differently, which reduces their usefulness as a
comparative measure. Because of these and other limitations, you
should consider Revenue ex-TAC and Revenue, Traffic Acquisition
Costs, Revenue ex-TAC by Region and Revenue ex-TAC by
Solution alongside our other U.S. GAAP financial results, including
revenue. The above tables provide a reconciliation of Revenue
ex-TAC to revenue, Revenue ex-TAC by Region to revenue by region
and Revenue ex-TAC by Solution to revenue by solution.
|
|
(2) Criteo operates as one operating
segment. From January 1,2021 we have disaggregated revenues between
Marketing Solutions and Retail Media. A strategic building
block of Criteo's Commerce Media Platform, the Retail Media
Platform, introduced in June 2020, is a self-service solution
providing transparency, measurement and control to brands and
retailers. In all arrangements running on this platform, Criteo
recognizes revenue on a net basis, whereas revenue from
arrangements running on legacy Retail Media solutions are accounted
for on a gross basis. Over time, we expect most clients using
Criteo's legacy Retail Media solutions to transition to this
platform. As new clients onboard and existing clients transition to
the Retail Media Platform, Revenue may decline but Revenue ex-TAC
margin will increase. Revenue ex-TAC will not be impacted by this
transition.
|
CRITEO
S.A. Reconciliation of Adjusted EBITDA to Net
Income (U.S. dollars in thousands,
unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
|
March
31,
|
|
|
|
|
2021
|
|
2020
|
|
YoY
Change
|
Net income
|
|
$
|
23,450
|
|
|
$
|
16,428
|
|
|
43
|
%
|
Adjustments:
|
|
|
|
|
|
|
Financial
expense
|
|
718
|
|
|
334
|
|
|
NM
|
|
Provision for income
taxes
|
|
10,051
|
|
|
7,040
|
|
|
43
|
%
|
Equity awards
compensation expense
|
|
7,882
|
|
|
8,503
|
|
|
(7)
|
%
|
Research and
development
|
|
2,496
|
|
|
2,370
|
|
|
5
|
%
|
Sales and
operations
|
|
2,369
|
|
|
3,618
|
|
|
(35)
|
%
|
General and
administrative
|
|
3,017
|
|
|
2,515
|
|
|
20
|
%
|
Pension service
costs
|
|
338
|
|
|
538
|
|
|
(37)
|
%
|
Research and
development
|
|
175
|
|
|
269
|
|
|
(35)
|
%
|
Sales and
operations
|
|
53
|
|
|
95
|
|
|
(44)
|
%
|
General and
administrative
|
|
110
|
|
|
174
|
|
|
(37)
|
%
|
Depreciation and
amortization expense
|
|
21,854
|
|
|
24,138
|
|
|
(9)
|
%
|
Cost of
revenue
|
|
15,244
|
|
|
12,771
|
|
|
19
|
%
|
Research and
development (1)
|
|
1,753
|
|
|
5,650
|
|
|
(69)
|
%
|
Sales and
operations
|
|
3,954
|
|
|
4,340
|
|
|
(9)
|
%
|
General and
administrative
|
|
903
|
|
|
1,377
|
|
|
(34)
|
%
|
Restructuring related
and transformation costs (2)
|
|
11,636
|
|
|
2,209
|
|
|
NM
|
|
Research and
development
|
|
1,436
|
|
|
995
|
|
|
44
|
%
|
Sales and
operations
|
|
7,367
|
|
|
1,021
|
|
|
NM
|
|
General and
administrative
|
|
2,833
|
|
|
193
|
|
|
NM
|
|
Total net
adjustments
|
|
52,479
|
|
|
42,762
|
|
|
23
|
%
|
Adjusted EBITDA
(3)
|
|
$
|
75,929
|
|
|
$
|
59,190
|
|
|
28
|
%
|
|
(1) For the Three Months Ended March
31, 2020, the Company recognized an accelerated amortization for
Manage technology due to a revised useful life in 2019 ($3.3
million in Research and development).
|
|
(2) For
the Three Months Ended March 2021, and March 2020, respectively,
the Company recognized restructuring related and transformation
costs following its new organizational structure implemented to
support its Commerce Media Platform strategy:
|
|
|
Three Months
Ended
|
|
March
31,
|
|
2021
|
|
2020
|
(Gain) from
forfeitures of share-based compensation awards
|
(666)
|
|
|
—
|
|
Facilities and
impairment related costs
|
6,616
|
|
|
987
|
|
Payroll related
costs
|
5,152
|
|
|
1,222
|
|
Consulting costs
related to transformation
|
534
|
|
|
—
|
|
Total
restructuring related and transformation costs
|
11,636
|
|
|
2,209
|
|
|
For the Three Months
Ended March 31, 2021 and March 31, 2020, respectively, the cash
outflows related to restructuring related and transformation costs
were $6.1 million, and $4.5 million respectively, and were mainly
comprised of payroll costs, broker and termination penalties
related to facilities and other consulting fees.
|
|
(3) We define Adjusted EBITDA as our
consolidated earnings before financial income (expense), income
taxes, depreciation and amortization, adjusted to eliminate the
impact of equity awards compensation expense, pension service
costs, and restructuring related and transformation costs. Adjusted
EBITDA is not a measure calculated in accordance with U.S. GAAP. We
have included Adjusted EBITDA because it is a key measure used by
our management and board of directors to understand and evaluate
our core operating performance and trends, to prepare and approve
our annual budget and to develop short-term and long-term
operational plans. In particular, we believe that the elimination
of equity awards compensation expense, pension service costs, and
restructuring related and transformation costs in calculating
Adjusted EBITDA can provide a useful measure for period-to-period
comparisons of our business. Accordingly, we believe that Adjusted
EBITDA provides useful information to investors and others in
understanding and evaluating our results of operations in the same
manner as our management and board of directors. Our use of
Adjusted EBITDA has limitations as an analytical tool, and you
should not consider it in isolation or as a substitute for analysis
of our financial results as reported under U.S. GAAP. Some of these
limitations are: (a) although depreciation and amortization are
non-cash charges, the assets being depreciated and amortized may
have to be replaced in the future, and Adjusted EBITDA does not
reflect cash capital expenditure requirements for such replacements
or for new capital expenditure requirements; (b) Adjusted EBITDA
does not reflect changes in, or cash requirements for, our working
capital needs; (c) Adjusted EBITDA does not reflect the potentially
dilutive impact of equity-based compensation; (d) Adjusted EBITDA
does not reflect tax payments that may represent a reduction in
cash available to us; and (e) other companies, including companies
in our industry, may calculate Adjusted EBITDA or similarly titled
measures differently, which reduces their usefulness as a
comparative measure. Because of these and other limitations, you
should consider Adjusted EBITDA alongside our U.S. GAAP financial
results, including net income.
|
CRITEO
S.A. Reconciliation from Non-GAAP Operating Expenses to
Operating Expenses under GAAP
(U.S. dollars in thousands, unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
|
March
31,
|
|
|
|
|
2021
|
|
2020
|
|
YoY
Change
|
Research and
Development expenses
|
|
$
|
(31,697)
|
|
|
$
|
(37,515)
|
|
|
(16)
|
%
|
Equity awards
compensation expense
|
|
2,496
|
|
|
2,370
|
|
|
5
|
%
|
Depreciation and
Amortization expense
|
|
1,753
|
|
|
5,650
|
|
|
(69)
|
%
|
Pension service
costs
|
|
175
|
|
|
269
|
|
|
(35)
|
%
|
Restructuring
related and transformation costs
|
|
1,436
|
|
|
995
|
|
|
44
|
%
|
Non GAAP - Research
and Development expenses
|
|
(25,837)
|
|
|
(28,231)
|
|
|
(8)
|
%
|
Sales and Operations
expenses
|
|
(79,354)
|
|
|
(84,974)
|
|
|
(7)
|
%
|
Equity awards
compensation expense
|
|
2,369
|
|
|
3,618
|
|
|
(35)
|
%
|
Depreciation and
Amortization expense
|
|
3,954
|
|
|
4,340
|
|
|
(9)
|
%
|
Pension service
costs
|
|
53
|
|
|
95
|
|
|
(44)
|
%
|
Restructuring
related and transformation costs
|
|
7,367
|
|
|
1,021
|
|
|
NM
|
|
Non GAAP - Sales and
Operations expenses
|
|
(65,611)
|
|
|
(75,900)
|
|
|
(14)
|
%
|
General and
Administrative expenses
|
|
(33,428)
|
|
|
(25,915)
|
|
|
29
|
%
|
Equity awards
compensation expense
|
|
3,017
|
|
|
2,515
|
|
|
20
|
%
|
Depreciation and
Amortization expense
|
|
903
|
|
|
1,377
|
|
|
(34)
|
%
|
Pension service
costs
|
|
110
|
|
|
174
|
|
|
(37)
|
%
|
Restructuring
related and transformation costs
|
|
2,833
|
|
|
193
|
|
|
NM
|
|
Non GAAP - General
and Administrative expenses
|
|
(26,565)
|
|
|
(21,656)
|
|
|
23
|
%
|
Total Operating
expenses
|
|
(144,479)
|
|
|
(148,404)
|
|
|
(3)
|
%
|
Equity awards
compensation expense
|
|
7,882
|
|
|
8,503
|
|
|
(7)
|
%
|
Depreciation and
Amortization expense
|
|
6,610
|
|
|
11,367
|
|
|
(42)
|
%
|
Pension service
costs
|
|
338
|
|
|
538
|
|
|
(37)
|
%
|
Restructuring
related and transformation costs
|
|
11,636
|
|
|
2,209
|
|
|
NM
|
|
Total Non GAAP
Operating expenses (1)
|
|
$
|
(118,013)
|
|
|
$
|
(125,787)
|
|
|
(6)
|
%
|
|
(1) We define Non-GAAP Operating
Expenses as our consolidated operating expenses adjusted to
eliminate the impact of depreciation and amortization, equity
awards compensation expense, pension service costs, and
restructuring related and transformation costs. The Company uses
Non-GAAP Operating Expenses to understand and compare operating
results across accounting periods, for internal budgeting and
forecasting purposes, for short-term and long-term operational
plans, and to assess and measure our financial performance and the
ability of our operations to generate cash. We believe Non-GAAP
Operating Expenses reflects our ongoing operating expenses in a
manner that allows for meaningful period-to-period comparisons and
analysis of trends in our business. As a result, we believe that
Non-GAAP Operating Expenses provides useful information to
investors in understanding and evaluating our core operating
performance and trends in the same manner as our management and in
comparing financial results across periods. In addition, Non-GAAP
Operating Expenses is a key component in calculating Adjusted
EBITDA, which is one of the key measures we use to provide our
quarterly and annual business outlook to the investment
community.
|
CRITEO
S.A. Detailed Information on Selected
Items (U.S. dollars in thousands,
unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
|
March
31,
|
|
|
|
|
2021
|
|
2020
|
|
YoY
Change
|
Equity awards
compensation expense
|
|
|
|
|
|
|
Research and
development
|
|
$
|
2,496
|
|
|
$
|
2,370
|
|
|
5
|
%
|
Sales and
operations
|
|
2,369
|
|
|
3,618
|
|
|
(35)
|
%
|
General and
administrative
|
|
3,017
|
|
|
2,515
|
|
|
20
|
%
|
Total equity awards
compensation expense
|
|
7,882
|
|
|
8,503
|
|
|
(7)
|
%
|
|
|
|
|
|
|
|
Pension service
costs
|
|
|
|
|
|
|
Research and
development
|
|
175
|
|
|
269
|
|
|
(35)
|
%
|
Sales and
operations
|
|
53
|
|
|
95
|
|
|
(44)
|
%
|
General and
administrative
|
|
110
|
|
|
174
|
|
|
(37)
|
%
|
Total pension service
costs
|
|
338
|
|
|
538
|
|
|
(37)
|
%
|
|
|
|
|
|
|
|
Depreciation and
amortization expense
|
|
|
|
|
|
|
Cost of
revenue
|
|
15,244
|
|
|
12,771
|
|
|
19
|
%
|
Research and
development
|
|
1,753
|
|
|
5,650
|
|
|
(69)
|
%
|
Sales and
operations
|
|
3,954
|
|
|
4,340
|
|
|
(9)
|
%
|
General and
administrative
|
|
903
|
|
|
1,377
|
|
|
(34)
|
%
|
Total depreciation
and amortization expense
|
|
21,854
|
|
|
24,138
|
|
|
(9)
|
%
|
|
|
|
|
|
|
|
Restructuring related
and transformation costs
|
|
|
|
|
|
|
Research and
development
|
|
1,436
|
|
|
995
|
|
|
44
|
%
|
Sales and
operations
|
|
7,367
|
|
|
1,021
|
|
|
NM
|
|
General and
administrative
|
|
2,833
|
|
|
193
|
|
|
NM
|
|
Total restructuring
related and transformation costs
|
|
$
|
11,636
|
|
|
$
|
2,209
|
|
|
NM
|
|
CRITEO
S.A. Reconciliation of Adjusted Net Income to Net
Income (U.S. dollars in thousands except share and per
share data, unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
|
March
31,
|
|
|
|
|
2021
|
|
2020
|
|
YoY
Change
|
|
|
|
|
|
|
|
Net income
|
|
$
|
23,450
|
|
|
$
|
16,428
|
|
|
43
|
%
|
Adjustments:
|
|
|
|
|
|
|
Equity awards
compensation expense
|
|
7,882
|
|
|
8,503
|
|
|
(7)
|
%
|
Amortization of
acquisition-related intangible assets (1)
|
|
2,935
|
|
|
6,848
|
|
|
(57)
|
%
|
Restructuring related
and transformation costs
|
|
11,636
|
|
|
2,209
|
|
|
NM
|
Tax impact of the
above adjustments
|
|
(2,751)
|
|
|
(1,960)
|
|
|
40
|
%
|
Total net
adjustments
|
|
19,702
|
|
|
15,600
|
|
|
26
|
%
|
Adjusted net income
(2)
|
|
$
|
43,152
|
|
|
$
|
32,028
|
|
|
35
|
%
|
|
|
|
|
|
|
|
Weighted average
shares outstanding
|
|
|
|
|
|
|
-
Basic
|
|
60,741,674
|
|
|
61,691,001
|
|
|
|
-
Diluted
|
|
64,077,409
|
|
|
62,125,582
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income
per share
|
|
|
|
|
|
|
-
Basic
|
|
$
|
0.71
|
|
|
$
|
0.52
|
|
|
37
|
%
|
-
Diluted
|
|
$
|
0.67
|
|
|
$
|
0.52
|
|
|
29
|
%
|
|
(1) For the Three Months Ended March
31, 2020, the Company recognized an accelerated amortization for
Manage technology due to a revised useful life in 2019 ($3.3
million in Research and development).
|
|
(2) We define Adjusted Net Income as
our net income adjusted to eliminate the impact of equity awards
compensation expense, amortization of acquisition-related
intangible assets, restructuring related and transformation costs,
and the tax impact of the foregoing adjustments. Adjusted Net
Income is not a measure calculated in accordance with U.S. GAAP. We
have included Adjusted Net Income because it is a key measure used
by our management and board of directors to evaluate operating
performance, generate future operating plans and make strategic
decisions regarding the allocation of capital. In particular, we
believe that the elimination of equity awards compensation expense,
amortization of acquisition-related intangible assets,
restructuring related and transformation costs and the tax impact
of the foregoing adjustments in calculating Adjusted Net Income can
provide a useful measure for period-to-period comparisons of our
business. Accordingly, we believe that Adjusted Net Income provides
useful information to investors and others in understanding and
evaluating our results of operations in the same manner as our
management and board of directors. Our use of Adjusted Net Income
has limitations as an analytical tool, and you should not consider
it in isolation or as a substitute for analysis of our financial
results as reported under U.S. GAAP. Some of these limitations are:
(a) Adjusted Net Income does not reflect the potentially dilutive
impact of equity-based compensation or the impact of certain
acquisition related costs; and (b) other companies, including
companies in our industry, may calculate Adjusted Net Income or
similarly titled measures differently, which reduces their
usefulness as a comparative measure. Because of these and other
limitations, you should consider Adjusted Net Income alongside our
other U.S. GAAP-based financial results, including net
income.
|
CRITEO
S.A. Constant Currency Reconciliation (U.S.
dollars in thousands, unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
|
March
31,
|
|
|
|
|
2021
|
|
2020
|
|
YoY
Change
|
|
|
|
|
|
|
|
Revenue as
reported
|
|
$
|
541,077
|
|
|
$
|
503,376
|
|
|
7
|
%
|
Conversion impact
U.S. dollar/other currencies
|
|
(16,747)
|
|
|
|
|
|
Revenue at constant
currency(1)
|
|
524,330
|
|
|
503,376
|
|
|
4
|
%
|
|
|
|
|
|
|
|
Traffic acquisition
costs as reported
|
|
(327,667)
|
|
|
(297,364)
|
|
|
10
|
%
|
Conversion impact
U.S. dollar/other currencies
|
|
10,317
|
|
|
|
|
|
Traffic Acquisition
Costs at constant currency(1)
|
|
(317,350)
|
|
|
(297,364)
|
|
|
7
|
%
|
|
|
|
|
|
|
|
Revenue ex-TAC as
reported(2)
|
|
213,410
|
|
|
206,012
|
|
|
4
|
%
|
Conversion impact
U.S. dollar/other currencies
|
|
(6,430)
|
|
|
|
|
|
Revenue ex-TAC at
constant currency(2)
|
|
206,980
|
|
|
206,012
|
|
|
0.5
|
%
|
Revenue
ex-TAC(2)/Revenue as reported
|
|
39
|
%
|
|
41
|
%
|
|
|
|
|
|
|
|
|
|
Other cost of revenue
as reported
|
|
(34,712)
|
|
|
(33,806)
|
|
|
3
|
%
|
Conversion impact
U.S. dollar/other currencies
|
|
322
|
|
|
|
|
|
Other cost of revenue
at constant currency(1)
|
|
(34,390)
|
|
|
(33,806)
|
|
|
2
|
%
|
|
|
|
|
|
|
|
Adjusted
EBITDA(3)
|
|
75,929
|
|
|
59,190
|
|
|
28
|
%
|
Conversion impact
U.S. dollar/other currencies
|
|
(4,591)
|
|
|
|
|
|
Adjusted
EBITDA(3) at constant currency(1)
|
|
$
|
71,338
|
|
|
$
|
59,190
|
|
|
21
|
%
|
Adjusted
EBITDA(3)/Revenue ex-TAC(2)
|
|
36
|
%
|
|
29
|
%
|
|
|
|
(1) Information herein with respect
to results presented on a constant currency basis is computed by
applying prior period average exchange rates to current period
results. We have included results on a constant currency basis
because it is a key measure used by our management and Board of
directors to evaluate operating performance. Management reviews and
analyzes business results excluding the effect of foreign currency
translation because they believe this better represents our
underlying business trends. The table above reconciles the actual
results presented in this section with the results presented on a
constant currency basis.
|
|
(2) Revenue ex-TAC is not a measure
calculated in accordance with U.S. GAAP. See the table entitled
"Reconciliation of Revenue ex-TAC to Revenue" for a reconciliation
of Revenue Ex-TAC to revenue.
|
|
(3)
Adjusted EBITDA is not a measure calculated in accordance with U.S.
GAAP. See the table entitled "Reconciliation of Adjusted EBITDA to
Net Income" for a reconciliation of Adjusted EBITDA to net
income.
|
CRITEO
S.A. Information on Share
Count (unaudited)
|
|
|
|
Three Months
Ended
|
|
|
2021
|
|
2020
|
Shares outstanding as
at January 1,
|
|
60,639,570
|
|
|
62,293,508
|
|
Weighted average
number of shares issued during the period
|
|
102,104
|
|
|
(602,507)
|
|
Basic number of
shares - Basic EPS basis
|
|
60,741,674
|
|
|
61,691,001
|
|
Dilutive effect of
share options, warrants, employee warrants - Treasury
method
|
|
3,335,736
|
|
|
434,581
|
|
Diluted number of
shares - Diluted EPS basis
|
|
64,077,410
|
|
|
62,125,582
|
|
|
|
|
|
|
Shares issued as
March 31, before Treasury stocks
|
|
66,391,906
|
|
|
66,202,881
|
|
Treasury stock as of
March 31,
|
|
(5,597,601)
|
|
|
(4,533,650)
|
|
Shares outstanding as
of March 31, after Treasury stocks
|
|
60,794,305
|
|
|
61,669,231
|
|
Total dilutive effect
of share options, warrants, employee warrants
|
|
7,458,737
|
|
|
6,982,753
|
|
Fully diluted shares
as at March 31,
|
|
68,253,042
|
|
|
68,651,984
|
|
CRITEO
S.A. Supplemental Financial Information and Operating
Metrics (U.S. dollars in thousands except where stated,
unaudited)
|
|
|
YoY
Change
|
QoQ
Change
|
Q1
2021
|
Q4
2020
|
Q3
2020
|
Q2
2020
|
Q1
2020
|
Q4
2019
|
Q3
2019
|
Q2
2019
|
Q1
2019
|
|
|
|
|
|
|
|
|
|
|
|
|
Clients
|
1%
|
(4)%
|
20,626
|
21,460
|
20,565
|
20,359
|
20,360
|
20,247
|
19,971
|
19,733
|
19,373
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
7%
|
(18)%
|
541,077
|
661,282
|
470,345
|
437,614
|
503,376
|
652,640
|
522,606
|
528,147
|
558,123
|
Americas
|
6%
|
(35)%
|
203,900
|
312,817
|
204,618
|
185,674
|
191,745
|
306,250
|
213,937
|
213,974
|
217,993
|
EMEA
|
12%
|
(9)%
|
212,096
|
232,137
|
167,800
|
159,621
|
190,114
|
216,639
|
185,556
|
194,359
|
209,643
|
APAC
|
3%
|
8%
|
125,081
|
116,328
|
97,927
|
92,319
|
121,517
|
129,751
|
123,113
|
119,814
|
130,487
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
7%
|
(18)%
|
541,077
|
661,282
|
470,345
|
437,614
|
503,376
|
N.A
|
N.A
|
N.A
|
N.A
|
Marketing
Solutions
|
3%
|
(11)%
|
483,190
|
543,262
|
412,126
|
381,270
|
469,773
|
N.A
|
N.A
|
N.A
|
N.A
|
Retail
Media
|
72%
|
(51)%
|
57,887
|
118,020
|
58,219
|
56,344
|
33,603
|
N.A
|
N.A
|
N.A
|
N.A
|
|
|
|
|
|
|
|
|
|
|
|
|
TAC
|
10%
|
(20)%
|
(327,667)
|
(408,108)
|
(284,401)
|
(257,698)
|
(297,364)
|
(386,388)
|
(301,901)
|
(304,229)
|
(322,429)
|
Americas
|
6%
|
(37)%
|
(127,628)
|
(203,341)
|
(130,756)
|
(115,317)
|
(120,022)
|
(189,092)
|
(129,047)
|
(129,491)
|
(131,545)
|
EMEA
|
17%
|
(8)%
|
(126,648)
|
(137,384)
|
(97,272)
|
(90,153)
|
(108,397)
|
(124,939)
|
(103,899)
|
(107,401)
|
(117,291)
|
APAC
|
6%
|
9%
|
(73,391)
|
(67,383)
|
(56,373)
|
(52,228)
|
(68,945)
|
(72,357)
|
(68,955)
|
(67,337)
|
(73,593)
|
|
|
|
|
|
|
|
|
|
|
|
|
TAC
|
10%
|
(20)%
|
(327,667)
|
(408,108)
|
(284,401)
|
(257,698)
|
(297,364)
|
N.A
|
N.A
|
N.A
|
N.A
|
Marketing
Solutions
|
7%
|
(10)%
|
(290,873)
|
(324,017)
|
(243,616)
|
(218,990)
|
(273,057)
|
N.A
|
N.A
|
N.A
|
N.A
|
Retail
Media
|
51%
|
(56)%
|
(36,794)
|
(84,091)
|
(40,785)
|
(38,708)
|
(24,307)
|
N.A
|
N.A
|
N.A
|
N.A
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue ex-TAC
(1)
|
4%
|
(16)%
|
213,410
|
253,174
|
185,944
|
179,916
|
206,012
|
266,252
|
220,705
|
223,918
|
235,694
|
Americas
|
6%
|
(30)%
|
76,272
|
109,476
|
73,862
|
70,357
|
71,723
|
117,158
|
84,890
|
84,483
|
86,448
|
EMEA
|
5%
|
(10)%
|
85,448
|
94,753
|
70,528
|
69,468
|
81,717
|
91,700
|
81,657
|
86,958
|
92,352
|
APAC
|
(2)%
|
6%
|
51,690
|
48,945
|
41,554
|
40,091
|
52,572
|
57,394
|
54,158
|
52,477
|
56,894
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue ex-TAC
(1)
|
4%
|
(16)%
|
213,410
|
253,174
|
185,944
|
179,916
|
206,012
|
N.A
|
N.A
|
N.A
|
N.A
|
Marketing
Solutions
|
(2)%
|
(12)%
|
192,317
|
219,245
|
168,510
|
162,280
|
196,716
|
N.A
|
N.A
|
N.A
|
N.A
|
Retail
Media
|
127%
|
(38)%
|
21,093
|
33,929
|
17,434
|
17,636
|
9,296
|
N.A
|
N.A
|
N.A
|
N.A
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flow from
operating activities
|
36%
|
76%
|
77,362
|
44,080
|
51,156
|
33,377
|
56,743
|
59,359
|
43,289
|
52,964
|
67,220
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
17%
|
(38)%
|
13,780
|
22,302
|
12,898
|
18,532
|
11,737
|
17,520
|
23,944
|
32,792
|
23,684
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital
expenditures/Revenue
|
N.A
|
N.A
|
3%
|
3%
|
3%
|
4%
|
2%
|
3%
|
5%
|
6%
|
4%
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash
position
|
19%
|
7%
|
520,060
|
488,011
|
626,744
|
578,181
|
436,506
|
418,763
|
409,178
|
422,053
|
395,771
|
|
|
|
|
|
|
|
|
|
|
|
|
Headcount
|
(6)%
|
(2)%
|
2,532
|
2,594
|
2,636
|
2,685
|
2,701
|
2,755
|
2,794
|
2,873
|
2,813
|
|
|
|
|
|
|
|
|
|
|
|
|
Days Sales
Outstanding (days - end of month)
|
N.A
|
N.A
|
64
|
56
|
62
|
61
|
62
|
52
|
57
|
58
|
59
|
|
(1) We define Revenue ex-TAC as our
revenue excluding traffic acquisition costs generated over the
applicable measurement period. Revenue ex-TAC, Traffic Acquisition
Costs, Revenue ex-TAC by Region and Revenue ex-TAC by Solution are
not measures calculated in accordance with U.S. GAAP. We have
included Revenue ex-TAC, Traffic Acquisition Costs, Revenue
ex-TAC by Region and Revenue ex-TAC by Solution because they are
key measures used by our management and board of directors to
evaluate operating performance, generate future operating plans and
make strategic decisions regarding the allocation of capital. In
particular, we believe that the elimination of TAC from revenue and
review of these measures by region and solution can provide useful
measures for period-to-period comparisons of our business.
Accordingly, we believe that Revenue ex-TAC, Traffic Acquisition
Costs, Revenue ex-TAC by Region, and Revenue ex-TAC by Solution
provide useful information to investors and others in understanding
and evaluating our results of operations in the same manner as our
management and board of directors. Our use of Revenue ex-TAC,
Traffic Acquisition Costs, Revenue ex-TAC by Region and Revenue
ex-TAC by Solution has limitations as an analytical tool, and you
should not consider them in isolation or as a substitute for
analysis of our financial results as reported under U.S. GAAP. Some
of these limitations are: (a) other companies, including companies
in our industry which have similar business arrangements, may
address the impact of TAC differently; (b) other companies may
report Revenue, Traffic Acquisition Costs, Revenue ex-TAC by
Region and Revenue ex-TAC by Solution, or similarly titled measures
but define the regions, and product families differently, which
reduces their effectiveness as a comparative measure; and (c) other
companies may report Revenue ex-TAC or similarly titled measures
but calculate them differently, which reduces their usefulness as a
comparative measure. Because of these and other limitations, you
should consider Revenue ex-TAC and Revenue, Traffic Acquisition
Costs, Revenue ex-TAC by Region and Revenue ex-TAC by
Solution alongside our other U.S. GAAP financial results, including
revenue. The above tables provide a reconciliation of Revenue
ex-TAC to revenue, Revenue ex-TAC by Region to revenue by region
and Revenue ex-TAC by Solution to revenue by solution.
|
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content:http://www.prnewswire.com/news-releases/criteo-reports-strong-first-quarter-2021-financial-results-301284133.html
SOURCE Criteo S.A.