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CST: 21/08/2018 01:25:59   

Propel Media Reports $9.2MM of Adjusted EBITDA and $20.9MM of Revenue for the 1st Quarter of 2018

97 Days ago

IRVINE, Calif., May 15, 2018 (GLOBE NEWSWIRE) -- Propel Media, Inc. (OTCPink:PROM), a performance focused digital media and advertising company, today announced its financial results for the first quarter ended March 31, 2018. The Company achieved revenue of $20.9 million and adjusted EBITDA of $9.2 million in the first quarter of 2018.

Performance Highlights for the First Quarter 2018:

  • Revenue of $20.9 million, which represents an increase of 12% as compared to $18.6 million in the first quarter of 2017
  •  Gross margin of 73%, which represents an increase of 17% as compared to 63% in the first quarter of 2017
  • Operating income of $8.1 million, which represents an increase of 20% as compared to $6.7 million in the first quarter of 2017
  • Adjusted EBITDA of $9.2 million, which represents an increase of 24% as compared to $7.4 million in the first quarter of 2017
  • DeepIntent, the integrated data and programmatic buying platform which the Company acquired in June of 2017, continues to focus on delivering high-value campaigns for pharma and healthcare clients, as well as several other key initiatives.

“The Company’s first quarter performance was excellent. The business performed well, and we were able to reduce our user acquisition spend which, in turn, increased our gross margins.  In addition, we continued to focus on building out DeepIntent’s product offerings and sales pipeline, particularly in the pharma vertical.  Finally, last week, with payments of $4.4 million, we were able to fully satisfy what had been $18.5 million of future obligations, which better positions us as we move to the next steps in our plan to refinance our term and revolving loans” said Marv Tseu, Chief Executive Officer of Propel Media.

Further details concerning the results of operations for the three months ended March 31, 2018 is set forth in the Company’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on May 14, 2018.

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  
    March 31,       December 31,  
    2018       2017  
Assets   (unaudited)    
Current assets      
Cash $ 8,764,000     $ 5,081,000  
Accounts receivable, net   7,418,000       9,502,000  
Prepaid expenses & other current assets   975,000       1,157,000  
Total current assets   17,157,000       15,740,000  
       
Property and equipment, net   3,658,000       3,315,000  
Intangible assets   1,135,000       1,201,000  
Goodwill   6,028,000       6,028,000  
Deferred tax assets, net   18,807,000       18,932,000  
Other assets   138,000       137,000  
Total assets $ 46,923,000     $ 45,353,000  
       
Liabilities and Stockholders’ Deficit      
Current liabilities      
Accounts payable $ 2,494,000     $ 4,419,000  
Accrued expenses   4,867,000       4,252,000  
Advertiser deposits   1,444,000       2,137,000  
Current portion of long-term debt   66,095,000       6,181,000  
Current portion of obligations to transferors   5,522,000       -  
Total current liabilities   80,422,000       16,989,000  
       
       
Long-term debt, less current portion, net   -       60,725,000  
Obligations to transferors, less curent portion, net   9,846,000       15,203,000  
Total liabilities   90,268,000       92,917,000  
       
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 March 31, 2018 and December 31, 2017   25,000       25,000  
Additional paid-in capital   3,964,000       3,717,000  
Accumulated deficit   (47,334,000 )     (51,306,000 )
Total stockholders’ deficit   (43,345,000 )     (47,564,000 )
Total liabilities and stockholders' deficit $ 46,923,000     $ 45,353,000  
       


 
Propel Media, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(unaudited)
       
  For the Three Months Ended March 31,
    2018       2017  
       
Revenues $ 20,920,000     $ 18,632,000  
Cost of revenues   5,562,000       6,933,000  
Gross profit   15,358,000       11,699,000  
       
Operating expenses:      
Salaries, commissions, benefits and related expenses   4,245,000       3,085,000  
Technology, development and maintenance   1,577,000       817,000  
Marketing and promotional   90,000       17,000  
General and administrative   510,000       353,000  
Professional services   421,000       276,000  
Depreciation and amortization   462,000       397,000  
Impairment of software and video library   -       20,000  
       
Operating expenses   7,305,000       4,965,000  
       
Operating income   8,053,000       6,734,000  
       
Other expense:      
Interest expense, net   (2,824,000 )     (2,911,000 )
Total other expense   (2,824,000 )     (2,911,000 )
       
Income before income tax expense   5,229,000       3,823,000  
Income tax expense   (1,257,000 )     (1,425,000 )
Net income $ 3,972,000     $ 2,398,000  
       
Net income per common share, basic and diluted $ 0.02     $ 0.01  
       
Weighted average number of common shares outstanding, basic and diluted   250,010,162       250,010,162  
       


 
Propel Media, Inc. and Subsidiaries
Reconciliation of Non-GAAP Information
(Unaudited)
       
       
       
  For the Three Months Ended  
  March 31, 2018   March 31, 2017
Net income $ 3,972,000     $ 2,398,000  
Depreciation and amortization   462,000       397,000  
Impairment charges   -       20,000  
Interest expense   2,824,000       2,911,000  
Stock-based compensation expense   247,000       229,000  
Taxes   1,263,000       1,427,000  
Bank fees   26,000       27,000  
Amortization of DeepIntent deferred purchase price   238,000       -  
Other one-time expenses   160,000       -  
Adjusted EBITDA (a non-GAAP measure) $ 9,192,000     $ 7,409,000  
       

Press Contact:
David Shapiro
Propel Media
press@propelmedia.com