Expects Revenue Growth of Approximately
50% for the Fiscal Year
TORONTO and NEW YORK, Sept. 11,
2017 /CNW/ - AcuityAds Holdings Inc. (TSXV:AT OTCQB:ACUIF)
("AcuityAds" or "Company"), a technology leader that enables
advertisers to connect intelligently with audiences across video,
mobile, social and online display advertising campaigns, today
announced an adjustment in its revenue expectations and at the
current pace is still anticipating 2017 full year growth of
approximately 50%.
The Company has outlined three significant factors that have led
to this revenue guidance for fiscal 2017.
Europe, Middle East & Africa (EMEA) Self-Service Region:
The Company has identified a select number of Self-Serve
partners in the EMEA region that were not meeting AcuityAds'
quality standards for the use of its Self-Serve platform. The
Company has chosen to take a long term view and remove these
partners from its Self-Serve platform recognizing that there would
be an impact on revenue. However, the Company believes that
this move would ultimately benefit its long-term growth
objectives.
"AcuityAds strives to promote the highest standards in
advertising and brand promotion," said Tal
Hayek, AcuityAds Chief Executive Officer. "We have an
aggressive long term strategy for the EMEA region and our decision
to cull certain Self-Serve Partners in this region is intended to
ensure that we maintain our strong brand equity with our customers,
partners and stakeholders around the globe".
The expected impact of this decision will result in an
adjustment in revenue expectations from this region of
approximately $10M over the balance
of fiscal 2017. The Company expects that the impact to net
revenue will be somewhat mitigated as this business had been
transacted at significantly lower margins.
140 Proof Changes:
A significant customer of 140 Proof recently changed the nature
of its relationship with the Company by electing to purchase its
proprietary social data rather than making the associated media
buys through 140 Proof's platform. As a result, the Company
believes this will have a potential $6M impact on the Company's 2017 revenue.
Despite this change, the 140 Proof acquisition is expected to
deliver approximately $5M of revenue
this fiscal year.
To date, the Company has made net payments to 140 Proof
stakeholders of approximately $2.8M.
Furthermore, given the potential risks that the Company
determined during the acquisition process, the transaction was
structured with an earn-out providing that all future payments
would be contingent upon 140 Proof meeting certain financial
targets. Given the change with this customer, the Company
believes that these targets are unlikely to be met and, as a
result, it is expected that the Company will significantly reduce
the earn-out obligations currently reflected on its balance
sheet. As a result, the Company expects this change to have a
positive effect on Adjusted EBITDA of approximately $3M for the quarter and expected to have a
negative impact on comprehensive income due to a potential
impairment charge on goodwill and intangible assets.
"While we are disappointed that a significant customer of 140
Proof changed the nature of its relationship with AcuityAds,
our due diligence and the subsequent deal structure has
successfully allowed us to mitigate against such outcomes", said
Mr. Hayek.
Strength of the Canadian Dollar:
As the Company reports its results in Canadian dollars, it is
expected that the stronger Canadian dollar will have an adverse
effect on the Company's revenue expectations for the second half of
2017 of approximately $2M.
As a result of these adjustments and changes, the Company has
already taken actions to reduce its Selling, General &
Administration (SG&A) expenses.
"We feel strongly that our actions this quarter demonstrate that
management has taken a long-term view to creating and enhancing
shareholder value," said Mr. Hayek. "When we see any activity that
does not meet our high standards, we move swiftly and without
compromise. When we acquire, we are meticulously focused on deal
structure to mitigate risk. Despite these adjustments to our
revenue guidance, we remain more committed than ever to both our
organic and non-organic growth strategy."
About AcuityAds:
AcuityAds is a technology company that enables marketers to
connect intelligently with their most meaningful audiences through
digital media. A Self-Serve programmatic marketing platform,
powered by machine learning, is at the core of our business. This
is accompanied by strategic digital advertising solutions that
cater to social, mobile and video-specific needs. AcuityAds
empowers marketers by offering transparency on costs and brand
safety, and real-time reporting and analytics, bringing
accountability to programmatic advertising to deliver business
results.
AcuityAds is headquartered in Toronto,
Canada with sales offices in New
York City, Boston,
Chicago, Los Angeles, San
Francisco, San Diego,
Vancouver, Calgary, Montreal and London,
England. For more information, visit AcuityAds.com.
Disclaimer in regards to Forward-looking
Statements
This press release contains "forward-looking statements" that
reflect the Company's current expectations and projections about
its future results. When used in this press release, forward
looking statements can be identified by the use of words such as
"may", or by such words as "will", "intend", "believe", "estimate",
"consider", "expect", "anticipate", and "objective" and similar
expressions or variations of such words. Forward-looking statements
are, by their nature, not guarantees of the Company's future
operational or financial performance, and are subject to risks and
uncertainties and other factors that could cause the Company's
actual results, performance, prospects or opportunities to differ
materially from those expressed in, or implied by, these forward
looking statements. No representation or warranty is intended with
respect to anticipated future results, or that estimates or
projections will be sustained.
In developing the forward-looking statements in this press
release, the Company has applied several material assumptions,
including the Company's ability and general business and economic
conditions. Many risks, uncertainties and other factors could cause
the actual results of the Company to differ materially from the
results, performance, achievements or developments expressed or
implied by such forward‐looking statements. These risks,
uncertainties and other factors include, but are not limited to the
following: overall economic conditions, rapid technological
changes, use of cookies, demand for the Company's product, the
introduction of competing technologies, competitive pressures,
network restrictions, fluctuations in foreign currency exchange
rates, and other similar factors that may cause the actual results,
performance or achievements to differ materially from those
expressed or implied in these forward‐looking statements.
Readers are cautioned not to place undue reliance on these
forward looking statements, which speak only as of the date of the
press release or as of the date otherwise specifically indicated
herein. Due to risks and uncertainties, including the risks and
uncertainties elsewhere in this press release, actual events may
differ materially from current expectations. The Company disclaims
any intention or obligation to update or revise any forward looking
statements, whether as a result of new information, future events
or otherwise. All forward looking statements, within this
release are expressly qualified in their entirety by this
cautionary statement.
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
SOURCE AcuityAds Inc.