Revenue increased 23% year-over-year to
$16.6 million; driven by CTV growth of 115%
Telaria, Inc. (NYSE:TLRA), the complete software platform that
optimizes yield for leading video publishers, today announced
financial results for the quarter ended September 30, 2019.
"This was another strong quarter for Telaria reflecting the
successful execution of our strategy as we continue to fortify our
leadership position in the CTV space. CTV is now approaching a
majority of our revenue and continues to be our core strategic
focus and biggest growth driver,” said Mark Zagorski, Telaria CEO.
“We continue to release innovative products that enable greater
addressability and transparency in digital video, helping to shift
TV dollars to CTV and deliver higher advertising yield
opportunities for our publishers. As a result, an increasing number
of leading broadcasters and video publishers around the globe are
relying on our platform to power their programmatic
advertising.”
Third Quarter 2019 Financial Highlights:
- Revenue of $16.6 million, up 23% year-over-year
- Gross profit of $13.1 million, up 13% year-over-year
- Adjusted EBITDA(1) of $(0.3) million, compared to break-even
for the same period last year
(1)
Adjusted EBITDA is a non-GAAP financial measure. Please see the
discussion in the section called “Non-GAAP Financial Measures” and
the reconciliation included at the end of this press release.
Third Quarter 2019 Business Highlights:
- CTV revenue increased 115% year-over-year to $7.3 million and
represented 44% of quarterly revenue
- Enhanced VMP with launch of Creative Communication Status tool
and commercialization of Audience Connect data suite
- Added premium video publishers across our global footprint in
the U.S., Canada, France and our first partner in Japan
- Recognized by Crain’s New York as one of the 50 fastest growing
companies and one of the best places to work in New York
Third Quarter Results
Summary
(in millions, except per share
amounts), (unaudited)
Three Months Ended September
30,
Nine Months Ended
September 30,
2019
2018
% Change
2019
2018
% Change
Revenue
$
16.6
$
13.5
23
%
$
48.4
$
35.5
36
%
Gross profit
$
13.1
$
11.6
13
%
$
39.1
$
31.5
24
%
Loss from continuing operations, net of
income taxes
$
(2.8
)
$
(1.6
)
(75
)%
$
(8.6
)
$
(10.7
)
20
%
Loss from continuing operations, net of
income taxes per share
$
(0.06
)
$
(0.03
)
(100
)%
$
(0.19
)
$
(0.21
)
10
%
Adjusted EBITDA(1)
$
(0.3
)
$—
N/M
$
(1.7
)
$
(4.4
)
61
%
(1)
Adjusted EBITDA is a non-GAAP financial measure. Please see the
discussion in the section called “Non-GAAP Financial Measures” and
the reconciliation included at the end of this press release.
Guidance
Based on information available as of November 5, 2019, the
Company expects the following:
Full Year 2019 Outlook
Full Year 2019
Revenue
$69.0 - $71.0 million
Adjusted EBITDA (1)
$2.0 - $4.0 million
(1)
Adjusted EBITDA is a non-GAAP financial
measure. Please see the discussion in the section called “Non-GAAP
Financial Measures”
Q3 2019 Financial Results Webcast: The Company will host
a conference call at 8:00 AM ET today to discuss its results. The
conference call can be accessed toll-free at (877) 407-9039 or
(201) 689-8470 (Toll/International). The call will also be
broadcast simultaneously at https://telaria.com. Following completion of the
call, a recorded replay of the webcast will be available on
Telaria’s website. To listen to the telephone replay, call
toll-free (844) 512-2921 or (412) 317-6671 (Toll/International),
replay Pin #: 13695215. The telephone replay will be available from
11:00 AM ET November 5, 2019 through 11:59 PM ET November 13, 2019.
Additional investor information can be accessed at https://investor.telaria.com.
About Telaria
Telaria, Inc. (NYSE:TLRA) powers the future of TV advertising
with proprietary, programmatic software that optimizes ad yield for
leading video publishers, enabling the most effective advertising
experience across desktop, mobile and CTV. Telaria’s clients
include the most innovative video content publishers across the
globe such as Hulu, SlingTV, SonyVue, Viacom’s PlutoTV, TubiTV,
Singtel, Australia’s Channel Nine and Channel Ten, and Brazil’s
Globo.
Telaria is headquartered in New York City and supports its
global client base out of 13 offices worldwide across North
America, EMEA, LATAM and APAC.
“Safe Harbor" Statement: This press release contains
forward-looking statements that involve risks, uncertainties,
assumptions and other factors that could cause actual results and
the timing of certain events to differ materially from those set
forth in or implied by such forward-looking statements. All
statements other than statements of historical fact are
forward-looking statements, including statements related to 2019
full year financial guidance and statements concerning the
Company’s growth or any markets in which it operates, including CTV
and OTT. Important factors that could cause actual results or the
timing of events to differ materially from those set forth in or
implied by any forward-looking statements include, without
limitation, risks and uncertainties associated with: the company’s
continuing development of its business model; unfavorable
conditions in the global economy or reductions in digital
advertising spend; the company’s ability to effectively innovate
and adapt to rapidly changing technology and client needs;
increased competition as well as innovations by new and existing
competitors; expansion of the online video advertising market; the
company’s ability to attract new demand partners and maintain
relationships with current demand partners; the company’s ability
to increase or maintain spend from existing demand partners; the
impact of the disposition of the company’s buyer platform on the
company’s operations and financial results; growth of OTT and
connected TV markets; and the shift of linear TV advertising
dollars to digital video; political uncertainty and the ability of
the company to attract political advertising; risks of entering new
markets in which we have limited or no experience and difficulty
adapting our solutions for new markets; the company’s ability to
attract sellers of premium video advertising inventory to its
platform and secure inventory on terms that are favorable to it;
the impact of increased transparency in programmatic transactions
executed through our platform; the company’s ability to detect
fraudulent or malicious activity and ensure a high level of brand
safety for its clients; identifying, attracting and retaining
qualified personnel; defects, errors or interruptions in the
company’s solutions; the company’s ability to collect, use and
process data to deliver its solutions; the impact of tools that
block the display of video ads; the effect of legal, regulatory
developments and industry standards regarding Internet privacy and
other matters; maintaining, protecting and enhancing the company’s
intellectual property; costs associated with defending intellectual
property infringement, securities litigation and other claims;
future opportunities and plans, including the uncertainty of
expected future financial performance and results; as well as other
risks and uncertainties detailed from time-to-time under the
caption “Risk Factors” and elsewhere in the company’s filings with
the U.S. Securities and Exchange Commission, including its Annual
Report on Form 10-K for the year ended December 31, 2018, filed
with the U.S. Securities and Exchange Commission on March 19, 2019,
its Quarterly Report on Form 10-Q for the period ended March 31,
2019 filed with the U.S Securities and Exchange Commission on May
9, 2019, its quarterly Report on Form 10-Q for the period ended
June 30, 2019 filed with the U.S Securities and Exchange Commission
on August 8, 2019, and future filings by the Company, including its
Quarterly Report on Form 10-Q for the period ended September 30,
2019.
Forward-looking statements are based on current expectations and
beliefs and are not guarantees of future performance or events.
Investors are cautioned not to place undue reliance on any
forward-looking statements. Furthermore, forward-looking statements
speak only as of the date on which they are made, and, except as
required by law, the Company disclaims any obligation to update
these forward-looking statements to reflect future events or
circumstances.
(1) Non-GAAP Financial Measures: To supplement its
consolidated financial statements, which are prepared and presented
in accordance with U.S. generally accepted accounting principles
(“GAAP”), the Company reports Adjusted EBITDA, which is a non-GAAP
financial measure. The Company defines Adjusted EBITDA as our loss
from continuing operations, net of income taxes, before
depreciation and amortization expense, total interest and other
income (expense), net and provision for income taxes, and as
adjusted to eliminate the impact of non-cash stock-based
compensation expense, expenses for prior corporate facilities
required to be recorded as operating expenses as a result of the
adoption of certain accounting standards, acquisition related
costs, restructuring costs, executive severance, retention and
recruiting costs, expenses for transitional services and other
adjustments. We use Adjusted EBITDA for financial and operational
decision-making and as a means to evaluate period-to-period
comparisons. We believe that the use of Adjusted EBITDA provides
useful information about our operating results, enhances the
overall understanding of our past financial performance and future
prospects, and allows for greater transparency with respect to a
key metric that is used by management in its financial and
operational decision making. Non-GAAP financial measures should be
considered in addition to results and guidance prepared in
accordance with GAAP, but should not be considered a substitute
for, or superior to, GAAP results. With respect to our expectations
under “Guidance” above, reconciliation of Adjusted EBITDA guidance
to the closest corresponding 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
costs and charges excluded from this non-GAAP measure, in
particular, the measures and effects of stock-based compensation
expense specific to equity compensation awards that are directly
impacted by unpredictable fluctuations in our stock price. We
expect the variability of these costs and charges to have a
significant, and potentially unpredictable, impact on our future
GAAP financial results.
Telaria, Inc.
Condensed Consolidated Balance
Sheets
(in thousands)
September 30,
December 31,
2019
2018
(unaudited)
Assets
Current assets:
Cash and cash equivalents
$
65,749
$
47,659
Accounts receivable net of allowance for
doubtful accounts of $1,069 and $982 as of September 30, 2019 and
December 31, 2018 respectively.
114,382
104,387
Prepaid expenses and other current
assets
3,903
3,381
Total current assets
184,034
155,427
Long-term assets:
Operating lease right-of-use asset, net of
amortization
24,132
—
Property and equipment net of accumulated
depreciation of $3,353 and $2,696 as of September 30, 2019 and
December 31, 2018, respectively
2,167
2,789
Intangible assets, net
3,601
4,379
Goodwill
9,277
9,478
Deferred tax assets
126
193
Other assets
1,998
2,440
Total long-term assets
41,301
19,279
Total assets
$
225,335
$
174,706
Liabilities and stockholders’
equity
Current liabilities:
Accounts payable and accrued expenses
$
137,646
$
109,991
Operating lease liability
5,078
—
Deferred rent
—
797
Contingent consideration on
acquisition
—
1,500
Other current liabilities
171
886
Total current liabilities
142,895
113,174
Long-term liabilities:
Operating lease liability, net of current
portion
24,987
—
Deferred rent, net of current portion
—
5,759
Deferred tax liabilities
1,099
1,153
Other non-current liabilities
218
225
Total liabilities
169,199
120,311
Commitments and contingencies
Stockholders’ equity:
Common stock
4
4
Treasury stock
(31,980
)
(31,980
)
Additional paid-in capital
303,393
293,154
Accumulated other comprehensive loss
(829
)
(949
)
Accumulated deficit
(214,452
)
(205,834
)
Total stockholders’ equity
56,136
54,395
Total liabilities and stockholders’
equity
$
225,335
$
174,706
Telaria, Inc.
Condensed Consolidated
Statements of Operations
(in thousands, except share
and per share data)
(unaudited)
Three Months Ended September
30,
Nine Months Ended
September 30,
2019
2018
2019
2018
Revenue
$
16,564
$
13,478
$
48,402
$
35,509
Cost of revenue
3,419
1,868
9,338
4,032
Gross profit
13,145
11,610
39,064
31,477
Operating expenses:
Technology and development(1)
2,936
2,432
8,531
7,044
Sales and marketing(1)
6,682
5,840
19,784
18,778
General and administrative(1)
6,839
4,306
21,204
14,670
Restructuring costs
—
32
—
149
Depreciation and amortization
345
523
1,153
3,198
Total operating expenses
16,802
13,133
50,672
43,839
Loss from continuing operations
(3,657)
(1,523)
(11,608)
(12,362)
Interest expense and other income,
net:
Interest expense
(1)
(27)
(2)
(74)
Other income, net
910
72
3,097
1,917
Total interest expense and other income,
net
909
45
3,095
1,843
Loss from continuing operations before
income taxes
(2,748)
(1,478)
(8,513)
(10,519)
Provision for income taxes
53
103
104
146
Loss from continuing operations, net of
income taxes
(2,801)
(1,581)
(8,617)
(10,665)
Loss on sale of discontinued operations,
net of income taxes
—
—
—
(136)
Net loss
$
(2,801)
$
(1,581)
$
(8,617)
$
(10,801)
Net loss per share — basic and
diluted:
Loss from continuing operations, net of
income taxes
$
(0.06)
$
(0.03)
$
(0.19)
$
(0.21)
Net loss
$
(0.06)
$
(0.03)
$
(0.19)
$
(0.21)
Weighted-average number of shares of
common stock outstanding:
Basic and diluted
46,158,465
52,716,626
45,579,435
52,265,228
(1) Stock-based compensation expenses
included above:
Three Months Ended September
30,
Nine Months Ended
September 30,
2019
2018
2019
2018
Stock-based compensation expense:
Technology and development
$
278
$
117
$
644
$
370
Sales and marketing
862
352
1,904
1,055
General and administrative
728
465
2,423
1,344
Total stock-based compensation expense in
continuing operations
$
1,868
$
934
4,971
$
2,769
Telaria, Inc.
Condensed Consolidated
Statements of Cash Flows
(in thousands)
(unaudited)
Nine Months Ended
September 30,
2019
2018
Cash flows from operating activities:
Net loss from continuing operations
$
(8,617
)
$
(10,665
)
Total loss from discontinued
operations
—
(136
)
Adjustments required to reconcile net loss
to net cash provided by operating activities:
Depreciation and amortization expense
1,153
3,198
Bad debt expense
110
190
Amortization of acquired technology
143
—
Loss on disposal of property and
equipment
128
41
Amortization of operating lease
right-of-use asset
2,965
—
Stock-based compensation expense
4,971
2,769
Deferred tax benefit
67
—
Net changes in operating assets and
liabilities:
Increase in accounts receivable
(10,197
)
(7,260
)
Increase in prepaid expenses, other
current assets
(765
)
(1,828
)
Increase in accounts payable and accrued
expenses
27,827
14,842
Decrease in other current liabilities
(60
)
(408
)
Decrease in operating lease liability
(3,463
)
—
Increase in deferred rent and security
deposits payable
7
656
Decrease in other liabilities
(10
)
(605
)
Net cash provided by operating
activities
14,259
794
Cash flows from investing activities:
Purchase of property and equipment
(230
)
(2,622
)
Acquisition, net of cash acquired
—
(4,856
)
Net cash used in investing activities
(230
)
(7,478
)
Cash flows from financing activities:
Contingent consideration on
acquisition
(1,500
)
—
Proceeds from the exercise of stock
options awards
5,869
1,776
Proceeds from issuance of common stock
under employee stock purchase plan
509
523
Tax withholdings related to net share
settlements of restricted stock unit awards (RSUs)
(1,110
)
(1,179
)
Net cash provided by financing
activities
3,768
1,120
Net increase (decrease) in cash and cash
equivalents
17,797
(5,564
)
Effect of exchange rate changes in cash
and cash equivalents
293
(189
)
Cash, cash equivalents at beginning of
period
47,659
76,320
Cash, cash equivalents at end of
period
$
65,749
$
70,567
Telaria, Inc.
Reconciliation of Net Loss
from Continuing Operations, Net of Income Taxes to Adjusted
EBITDA
(in thousands)
(unaudited)
Three Months Ended September
30,
Nine Months Ended
September 30,
2019
2018
2019
2018
Loss from continuing operations, net of
income taxes
$
(2,801)
$
(1,581)
$
(8,617)
$
(10,665)
Adjustments:
Depreciation and amortization expense
392
523
1,296
3,198
Total interest expense and other income,
net(1)
(909)
(45)
(3,095)
(1,843)
Provision for income taxes
53
103
104
146
Stock-based compensation expense
1,868
934
4,971
2,769
Expenses for prior corporate facilities
(2)
1,065
—
3,130
—
Acquisition-related costs
—
73
—
402
Restructuring costs
—
32
—
149
Executive severance, retention and
recruiting costs
—
—
473
223
Expenses for transitional services(3)
—
—
—
697
Other adjustments(4)
—
—
—
563
Total net adjustments
2,469
1,620
6,879
6,304
Adjusted EBITDA
$
(332)
$
39
$
(1,738)
$
(4,361)
(1)
Reflects sublease income for our former
office facilities. In addition, for the three and nine months ended
September 30, 2018, includes income received from the transfer of
rights in the name "Tremor Video".
(2)
For the three and nine months ended
September 30, 2019, reflects lease costs for prior corporate
facilities, previously recorded in interest and other income
(expenses), which are now required to be recorded in operating
expenses as a result of the adoption of ASC 842 (Leases).
(3)
For the nine months ended September 30,
2018, reflects costs incurred providing transitional services
following the sale of the divested buyer platform.
(4)
For the nine months ended September 30,
2018, reflects rent expense for our current corporate headquarters,
which was then unoccupied.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20191105005273/en/
Investor Relations: Andrew Posen Vice President, Head of
Investor Relations 212-792-2315 IR@telaria.com
Media: Lekha Rao Vice President, Media Relations &
Corporate Communications 646-226-0254 lrao@telaria.com
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