- The Company expects close to US$4.0
million in annualized cost savings from recent cost
reductions and operational efficiency initiatives, driving positive
Adjusted EBITDA for 2H-2023.
- Won over US$9.0 million in
upfront commitments for 2024 from major agencies; continuing to
negotiate further commitments.
TORONTO, Oct.
30, 2023 /CNW/ -- Sabio Holdings Inc. (TSXV: SBIO;
OTCQX: SABOF) (the "Company" or "Sabio"), a leading provider of
Connected TV ("CTV")/over-the-top ("OTT") advertising platforms
validated by performance, is pleased to provide a business update
for the third quarter of 2023, including its cost and operational
efficiency initiatives, preliminary results for its Q3-2023
financial performance, a status update on upfront commitments
negotiated for 2024, and a leadership update.
Cost and Operational Efficiency Initiatives and Q3-2023
Financial Performance
The CTV/OTV space is continually evolving, and aligned with
that, the Company is continuously seeking opportunities to create a
more efficient and streamlined business. During the third quarter,
management implemented several initiatives aimed at creating
operational efficiencies and reducing costs. These initiatives,
which are expected to result in approximately US$4.0 million in annualized cost savings
included strategic headcount reductions; the exiting of
non-essential contractor and supplier arrangements; and the
optimization of certain operational processes, including
enhancement of the Company's cloud storage strategy.
"The macro headwinds impacting overall advertising spend
were pronounced in the third quarter, as rising interest rates and
category-specific events including the auto workers strike impacted
short-term advertising budgets," commented Sajid Premji, Sabio's CFO. "During the
quarter, Sabio faced these challenges head-on implementing
several cost and operational initiatives to optimize our operating
infrastructure. While some of these initiatives, including our
headcount reductions, did not take effect until the beginning of
September, they were instrumental in helping us maintain Adjusted
EBITDA neutrality in Q3-2023. Moreover, our reduced break-even
point positions us well to realize meaningful positive Adjusted
EBITDA in the fourth quarter, and into 2024 when the full benefit
of these reductions will be realized. Our performance in winning
the upfront commitments has already set a Company record without
the expected tailwinds of the 2024 U.S. election cycle,
demonstrating the strength of our technology-led value proposition
in the CTV/OTT market."
Sabio expects revenues for Q3-2023 to be in the range of
US$8.5 million to US$8.8 million, and Adjusted EBITDA to be in the
range of a loss of US$0.2M to
slightly positive. Overall operating expenditures are expected to
decrease sequentially compared to the second quarter of 2023 and on
a year-over-year basis compared to the third quarter of 2022. The
Company expects to end Q3-2023 with over US$2.0 million in cash on hand.
The Company will provide the full financial results in the
upcoming filing of the Company's financial statements and MD&A
which are anticipated to be filed on SEDAR and made available on
the Company's website before November 29,
2023.
Upfront Commitments
Sabio is also pleased to announce commitments from various
parties to endeavor to spend an aggregate of a minimum of
US$9.0 million in 2024, and does not
include potential political and advocacy commitments ahead of the
2024 election cycle. The commitments span across several
diversified verticals including automotive, quick-service and
casual restaurants, and sports and entertainment.
"These multi-million-dollar upfronts, secured with some of the
biggest agency holding companies in advertising, speaks
volumes to Sabio's differentiated position in CTV/OTT"
said Aziz Rahimtoola, CEO. "Our
focus on assembling one of the most complete end-to-end technology
stacks in the fast growing ad-supported streaming space, where the
U.S. market is expected to grow to over $29 billion in 20241, has delivered
increased revenue from existing customers along with a 38% increase
in new Fortune 500 nameplates."
Leadership Update
The Company also announces that Humera
Kassem, Sabio's Chief People Officer will be leaving her
position and the Company effective November
30, 2023 as she moves on to new challenges and opportunities
in her home state of Texas.
"Humera has played an important role in the growth and
development of Sabio's team culture and human resources systems."
said Aziz Rahimtoola. "We wish her
the best in her future endeavors and appreciate the contributions
she has made to Sabio through her tenure."
The preliminary results set forth above are based on
management's initial review of the Company's operating and
financial results for Q3-2023 and are subject to change as these
results have not been reviewed. Final reported results could differ
from these preliminary results following the completion of
quarter-end and year-end accounting procedures, final adjustments,
and other developments arising between now and the time that the
Company's financial results are finalized, and such changes could
be material. The Company's independent auditor, MNP LLP, has not
reviewed, or performed any procedures with respect to the
accompanying preliminary financial results and other data and,
accordingly, does not express an opinion or any other form of
assurance with respect thereto.
These estimates are subject to a number of cautionary
statements, assumptions, contingencies and risks as set forth in
this news release. The foregoing outlook and expectations
constitute forward-looking statements and financial outlook and are
qualified in their entirety by the "Forward-Looking Statements"
cautionary statement below. The purpose of this financial outlook
is to provide readers with early guidance regarding management's
current reasonable expectations as to the anticipated results for
Q3-2023. Readers are cautioned that this financial outlook may not
be appropriate for other purposes.
About Sabio Holdings
Sabio Holdings Inc. (TSXV:
SBIO) (OTCQX: SABOF) is one of the fastest-growing CTV/OTT
technology and service providers in the high-growth ad-supported
video-on-demand ("AVOD") and FAST channel space. Its cloud-based
CTV/OTT technologies provide publishers with distribution,
monetization, and analytics while delivering ROI validation for
brands and agencies. The Sabio portfolio is comprised of: Sabio —
our trusted and transparent content monetization demand-side
platform (DSP); App Science® — our cutting edge,
non-panel based, real-time measurement and attribution software as
a service (SAAS) platform; and Vidillion — our cloud-based
ad-insertion, and content distribution and management platform. For
more information, visit: sabioholding.com
Forward-Looking Statements
This press release may contain certain forward-looking
information and statements ("forward-looking information")
within the meaning of applicable Canadian securities legislation,
including but not limited to the release of Q3-2023 results, that
are not based on historical fact, including without limitation
statements containing the words "believes", "anticipates", "plans",
"intends", "will", "should", "expects", "continue", "estimate",
"forecasts" and other similar expressions. Readers are
cautioned to not place undue reliance on forward-looking
information. Actual results and developments may differ materially
from those contemplated by these statements. The Company undertakes
no obligation to comment on analyses, expectations or statements
made by third-parties in respect of the Company, its securities, or
financial or operating results (as applicable). Although the
Company believes that the expectations reflected in forward-looking
information in this press release are reasonable, such
forward-looking information has been based on expectations, factors
and assumptions concerning future events that may prove to be
inaccurate and are subject to numerous risks and uncertainties,
certain of which are beyond the Company's control, including the
risk factors disclosed in the Filing Statement which is publicly
available on SEDAR at www.sedar.com. The forward-looking
information contained in this press release is expressly qualified
by this cautionary statement and is made as of the date hereof. The
Company disclaims any intention and has no obligation or
responsibility, except as required by law, to update or revise any
forward-looking information, whether as a result of new
information, future events or otherwise.
This news release shall not constitute an offer to sell or
the solicitation of an offer to buy any securities in any
jurisdiction.
Neither the TSX Venture Exchange nor its Regulation
Service Provider (as that term is defined in the policies of the
TSX Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Media Contacts
Sajid Premji, Chief Financial
Officer
investor@sabio.inc
1-844-974-2662
Sam Wang, Investor Relations
investor@sabio.inc
Hollis Guerra, Daddi Brand
Communications
hguerra@daddibrand.com
1
https://www.insiderintelligence.com/chart/262315/us-connected-tv-ctv-ad-spending-2021-2027-billions-change-of-digital-ad-spending
SOURCE Sabio Holdings Inc