28 Apr ASX ANNOUNCEMENT: PPL records Q3 revenue of $14.9m with 32% growth
Pureprofile (ASX: PPL, or the “Company”) is pleased to release its March Quarterly Activity Report and Appendix 4C. The Company is pleased to report record revenues for the quarter following the acquisition of Cohort in Q2 and 32% growth across the Data and Insights and Programmatic Media business units over the previous corresponding period (PcP).
- Quarterly revenue of $14.9m – a record quarter for Pureprofile
- Operating cash flow of $0.5m – the fifth consecutive quarter of positive operating cash flow
- Cohort integration progressing well with UK business growing strongly
- Cash and cash equivalents of $3.32m at the end of the quarter
Data and Insights
The Data and Insights business unit continued to perform well, recording $3.0m revenue for the quarter and $9.4m YTD, an increase of 21% PcP.
The Programmatic Media business continued to grow strongly with revenue reaching $5.6m for the quarter ($17.15m YTD), an increase of 40% over the previous corresponding period.
In November 2016, Pureprofile completed the acquisition of Cohort Global (Cohort), a successful lead generation business operating in Australia, the UK and US.The integration of Cohort is proceeding well with cross-selling opportunities being pursued across the group and a growing pipeline of opportunities.
Cohort generated revenue of $6.3m for the quarter, with the UK business growing by 55% over the previous quarter. Growth in Cohort’s Australian business was more challenging in Q3 with several of Cohort’s customers temporarily reducing their marketing budgets in the period. Cohort’s management is, however, optimistic that Q4 in Australia will be a stronger quarter.
Accordingly, Pureprofile currently expects that Cohort will generate EBITDA in excess of $4m for FY17, improving on the $3.7m of EBITDA achieved in FY16 and triggering payment of the earn-out. In Pureprofile’s half-year accounts a provision of $8.5m was made for deferred consideration relating to the earn-out.
Based upon Cohort’s year-to-date results, the Company expects the earn-out consideration payable is likely to be less than the $8.5m provision made at 31 December 2016. Historically though, the last quarter has been the strongest for Cohort’s business. Pureprofile, therefore, believes it prudent to leave the earn-out provision at $8.5m until the full year results and total earn-out can be accurately estimated.
There are two tranches to the earn-out consideration. If earned, both would be payable in Q2 FY2018:
- Earn-out Tranche 1 – earned if FY17 normalised EBITDA is $4m or more. Consideration is payable in Pureprofile shares to be issued at $0.45 per share and escrowed until May 2018; and
- Earn-out Tranche 2 – the relevant calculation is expected to be 5x (FY17 normalised EBITDA less $4m). Consideration would be payable in either cash or PPL shares (issued at a minimum price of $0.50) with the form of consideration at the sellers’ discretion.
Paul Chan, Pureprofile’s CEO, said,
“I am pleased with a solid Q3, in particular the growth of our international business in line with our growth strategies. Q4 is historically the strongest period for the group and we have started the quarter well. We are continuing to deliver strong value for the biggest brands, publishers and advertisers that are embracing the consumer driven model of marketing. The Cohort acquisition is clearly a strategic addition to the Group, substantially increasing our scale and global footprint.”
“Our industry leading technology platform and products continue to deliver new contract wins. Most importantly, we are building a strong pipeline of opportunities with large national and global brands and publishers.”