3rd Quarter of 2017 Adjusted EBITDA up 42% Compared to 3rd Quarter of 2016
Company Trailing 12 Month Adjusted EBITDA of $32.9 Million
IRVINE, Calif., Nov. 13, 2017 (GLOBE NEWSWIRE) -- Propel Media, Inc. (OTCPink:PROM), a performance focused digital media and advertising company, today announced its results for the 3rd quarter and first nine months of 2017. The Company achieved $22.2 million in revenue and an adjusted EBITDA of $8.7 million in the 3rd quarter of 2017.
For the Three Months Ended September 30, 2017:
- Revenue of $22.2 million as compared to $13.7 million in the 3rd quarter of 2016
- Operating income of $7.6 million as compared to $5.2 million in the 3rd quarter of 2016
- Net income of $3.0 million as compared to net loss of $0.1 million in the 3rd quarter of 2016
- Adjusted EBITDA of $8.7 million as compared to $6.1 million in the 3rd quarter of 2016
For the Nine Months Ended September 30, 2017:
- Revenue of $62.4 million as compared to $44.6 million in the first nine months of 2016
- Operating income of $23.3 million as compared to $10.4 million in the first nine months of 2016
- Net income of $8.8 million as compared to net loss of $0.7 million in the first nine months of 2016
- Adjusted EBITDA of $25.9 million as compared to $15.0 million in the first nine months of 2016
3rd Quarter Business Highlights:
- 11th consecutive positive Adjusted EBITDA quarter since becoming a publicly-traded company in January 2015
- Adjusted EBITDA of $32.9 million for the 12 months ending September 30, 2017
- Increased media buying efforts to expand the Company’s owned and operated member-based network
- Continued to invest in DeepIntent, the Company’s newly acquired integrated data and programmatic buying platform
“Propel Media strategically focused on expanding its owned and operated member-based network through increased media buying expenditures in the third quarter,” said Marv Tseu, Chief Executive Officer of Propel Media. “We also invested in DeepIntent’s software development and sales teams. We expect to continue to devote resources in the 4th quarter to grow our audience and to invest in DeepIntent,” continued Tseu.
Further details concerning the results of operations for the three and nine months ended September 30, 2017 is set forth in the Company’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 13, 2017.
About Propel Media
Propel Media connects digital marketers with unique audiences through intent-based technology that delivers superior performance with measurable results. We “Do Digital Differently” with a distinctive approach to digital powered by proprietary contextualization technology and a unique supply of ad inventory. Headquartered in Irvine, California, Propel Media is distinguished by its ability to deliver consistent results and its commitment to providing the highest level of client services to its partners.
For more information visit: www.propelmedia.com
Forward-Looking Statements:
This press release includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including those statements regarding Propel Media’s capital structure, ability to execute its operating plan, anticipated financial flexibility and future financial performance and any other statements that are not statements of historical fact. These statements may be identified, without limitation, by the use of forward-looking terminology such as “anticipates”, “expects,” “will” or comparable terms or the negative thereof. Such statements are based on management’s current estimates, assumptions that management believes to be reasonable, and currently available competitive, financial, and economic data as of the date hereof. Forward-looking statements are inherently uncertain and subject to a variety of events, factors and conditions, many of which are beyond the control of Propel Media and not all of which are known to Propel Media, including, without limitation those risk factors described from time to time in Propel Media’s reports filed with the SEC. Among the factors that could cause Propel Media’s actual results to differ materially are: loss of key advertising customers; inability to acquire new advertising customers; limitations on its ability to acquire new users profitably or at all; inability to protect its intellectual property; inability to comply with the covenants in its credit facility; inability to obtain necessary financing or enter into equity arrangements with existing or new institutional shareholders; inability to execute its acquisition strategy; inability to effectively manage its growth; failure to effectively integrate the operations of acquired businesses; competition; loss of key personnel; increases in costs of operations; continued compliance with government regulations; and general economic conditions. Further, investors should keep in mind that Propel Media’s financial results in any particular period may not be indicative of future results. Propel Media is under no obligation to, and expressly disclaims any obligation to, update or alter its forward-looking statements, whether as a result of new information, future events, changes in assumptions or otherwise, except as required by law.
Use of Non-GAAP Financial Information
In addition to the results presented in accordance with generally accepted accounting principles, or GAAP, we present Adjusted EBITDA, which is a non-GAAP measure. Adjusted EBITDA, which is based upon the adjusted EBITDA which we report to our lenders, is a key measurement monitored by management, and is determined by taking net (loss) income (the nearest GAAP measure) and adding interest, taxes, depreciation, amortization, impairment charges, stock based compensation, bank fees, losses from extraordinary, unusual or nonrecurring items, noncash items, merger and other onetime expenses and severance. We believe that this non-GAAP measure, viewed in addition to and not in lieu of our reported GAAP results, provides useful information to investors by providing a more focused measure of operating results, enhances the overall understanding of past financial performance and future prospects, and allows for greater transparency with respect to key metrics used by management in its financial and operational decision making. The non-GAAP measure presented herein may not be comparable to similarly titled measures presented by other companies. Adjusted EBITDA has been reconciled to the nearest GAAP measure in the table following the financial statements attached to this press release.
| Propel Media, Inc. and Subsidiaries | ||||||||
| Condensed Consolidated Balance Sheets | ||||||||
| As of | ||||||||
| September 30, | December 31, | |||||||
| 2017 | 2016 | |||||||
| Assets | (unaudited) | |||||||
| Current assets | ||||||||
| Cash | $ | 2,556,000 | $ | 2,823,000 | ||||
| Accounts receivable, net | 10,520,000 | 6,595,000 | ||||||
| Prepaid expenses & other current assets | 826,000 | 564,000 | ||||||
| Total current assets | 13,902,000 | 9,982,000 | ||||||
| Property and equipment, net | 1,387,000 | 1,594,000 | ||||||
| Intangible assets | 1,267,000 | 20,000 | ||||||
| Goodwill | 6,057,000 | 2,869,000 | ||||||
| Deferred tax assets, net | 30,697,000 | 31,691,000 | ||||||
| Other assets | 65,000 | 89,000 | ||||||
| Total assets | $ | 53,375,000 | $ | 46,245,000 | ||||
| Liabilities and Stockholders’ Deficit | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | 3,937,000 | $ | 1,861,000 | ||||
| Accrued expenses | 4,108,000 | 3,914,000 | ||||||
| Advertiser deposits | 1,295,000 | 1,832,000 | ||||||
| Current portion of long-term debt | 6,158,000 | 6,089,000 | ||||||
| Total current liabilities | 15,498,000 | 13,696,000 | ||||||
| Long-term debt, less current portion, net | 61,522,000 | 65,999,000 | ||||||
| Obligations to transferors | 15,038,000 | 14,569,000 | ||||||
| Other non-current liabilities | - | 142,000 | ||||||
| Total liabilities | 92,058,000 | 94,406,000 | ||||||
| Stockholders' Deficit | ||||||||
| Preferred Stock, $0.0001 par value, authorized 1,000,000 shares, | - | - | ||||||
| no shares issued or outstanding | ||||||||
| Common Stock, $0.0001 par value, authorized 500,000,000 shares, | ||||||||
| issued and outstanding 250,010,162 | ||||||||
| at September 30, 2017 and December 31, 2016 | 25,000 | 25,000 | ||||||
| Additional paid-in capital | 3,474,000 | 2,757,000 | ||||||
| Accumulated deficit | (42,182,000 | ) | (50,943,000 | ) | ||||
| Total stockholders’ deficit | (38,683,000 | ) | (48,161,000 | ) | ||||
| Total liabilities and stockholders' deficit | $ | 53,375,000 | $ | 46,245,000 | ||||
| Propel Media, Inc. and Subsidiaries | |||||||||||||||
| Condensed Consolidated Statements of Operations | |||||||||||||||
| (unaudited) | |||||||||||||||
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||
| 2017 | 2016 | 2017 | 2016 | ||||||||||||
| Revenues | $ | 22,207,000 | $ | 13,687,000 | $ | 62,354,000 | $ | 44,589,000 | |||||||
| Cost of revenues | 8,218,000 | 3,826,000 | 22,574,000 | 16,430,000 | |||||||||||
| Gross profit | 13,989,000 | 9,861,000 | 39,780,000 | 28,159,000 | |||||||||||
| Operating expenses: | |||||||||||||||
| Salaries, commissions, benefits and related expenses | 3,891,000 | 2,581,000 | 10,311,000 | 10,501,000 | |||||||||||
| Technology, development and maintenance | 1,021,000 | 883,000 | 2,655,000 | 3,086,000 | |||||||||||
| Marketing and promotional | 32,000 | 20,000 | 61,000 | 69,000 | |||||||||||
| General and administrative | 710,000 | 233,000 | 1,387,000 | 1,233,000 | |||||||||||
| Professional services | 279,000 | 416,000 | 878,000 | 996,000 | |||||||||||
| Depreciation and amortization | 438,000 | 525,000 | 1,210,000 | 1,723,000 | |||||||||||
| Impairment of software and video library | - | - | 20,000 | 183,000 | |||||||||||
| Operating expenses | 6,371,000 | 4,658,000 | 16,522,000 | 17,791,000 | |||||||||||
| Operating income | 7,618,000 | 5,203,000 | 23,258,000 | 10,368,000 | |||||||||||
| Other income (expense): | |||||||||||||||
| Interest expense, net | (2,813,000 | ) | (3,095,000 | ) | (9,335,000 | ) | (9,284,000 | ) | |||||||
| Gain from extinguishment of debt | - | - | - | 106,000 | |||||||||||
| Other income (expense) | - | - | (1,000 | ) | 18,000 | ||||||||||
| Total other expenses | (2,813,000 | ) | (3,095,000 | ) | (9,336,000 | ) | (9,160,000 | ) | |||||||
| Income before income tax expense | 4,805,000 | 2,108,000 | 13,922,000 | 1,208,000 | |||||||||||
| Income tax expense | (1,797,000 | ) | (2,250,000 | ) | (5,161,000 | ) | (1,887,000 | ) | |||||||
| Net income (loss) | $ | 3,008,000 | $ | (142,000 | ) | $ | 8,761,000 | $ | (679,000 | ) | |||||
| Net income (loss) per common share | $ | 0.01 | $ | (0.00 | ) | $ | 0.04 | $ | (0.00 | ) | |||||
| Weighted average number of shares outstanding - basic and diluted | 250,010,162 | 250,010,162 | 250,010,162 | 250,010,162 | |||||||||||
| Propel Media, Inc. and Subsidiaries | ||||||||||||||
| Reconciliation of Non-GAAP Information | ||||||||||||||
| (Unaudited) | ||||||||||||||
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||
| 2017 | 2016 | 2017 | 2016 | |||||||||||
| Net income (loss) | $ | 3,008,000 | $ | (142,000 | ) | $ | 8,761,000 | $ | (679,000 | ) | ||||
| Depreciation and amortization | 438,000 | 525,000 | 1,210,000 | 1,723,000 | ||||||||||
| Impairment charges | - | - | 20,000 | 183,000 | ||||||||||
| Interest expense | 2,813,000 | 3,095,000 | 9,335,000 | 9,284,000 | ||||||||||
| Stock-based compensation expense | 262,000 | 240,000 | 717,000 | 1,412,000 | ||||||||||
| Taxes | 1,798,000 | 2,206,000 | 5,166,000 | 1,897,000 | ||||||||||
| Bank fees (credits) | 29,000 | 26,000 | 81,000 | (3,000 | ) | |||||||||
| Amortization of DeepIntent deferred purchase price | 238,000 | - | 264,000 | - | ||||||||||
| Merger and other one-time expenses | 140,000 | 172,000 | 321,000 | 225,000 | ||||||||||
| Severance | - | 13,000 | - | 913,000 | ||||||||||
| Adjusted EBITDA (a non-GAAP measure) | $ | 8,726,000 | $ | 6,135,000 | $ | 25,875,000 | $ | 14,955,000 | ||||||
Press Contact:
David Shapiro
Propel Media
press@propelmedia.com