Nexxen International (NEXN) Q4 2014 earnings summary

Executive summary

• FY14 revenue rose 46% to $63.1m, driven by publisher and advertiser growth; Taptica acquisition expanded mobile, video and data capabilities.

• AIM admission on 28 May 2014 raised $50m gross; proceeds supported technology investment and targeted acquisitions.

• Mobile rose to 28% of Q4 revenue from 18% for FY14, positioning mobile as the primary growth focus.

Financial highlights

• Revenue $63.1m, up 46% YoY; gross profit $19.0m, up 35%; operating profit $8.6m vs $8.4m.

• Net income was $6.1m vs $7.1m; adjusted EBITDA, excluding share-based payments, increased 19% to $10.5m from $8.8m.

• R&D expense increased 152% to $2.0m; operating cash flow rose 19% to $8.6m.

• Cash and cash equivalents at 31 Dec 2014 were $24.7m vs $3.2m a year earlier.

Outlook and guidance

• FY15 revenue growth expected, primarily from acceleration in mobile; stated position was profitable and cash-generative.

• Mobile/video SSP targeted for launch by end-H1 2015; cross-device single tag expected Q2, with integrated SSP/DSP DMP planned for early H2.

• New York office opened in Q1 2015 to pursue East Coast agencies and brands; a mobile advertising analytics tool was also launched.

• Tier 1 customers expected to remain an important growth driver as technology and data capabilities develop.