TIDMTRMR
RNS Number : 1040J
Tremor International Ltd
19 August 2021
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF REGULATION 11 OF THE MARKET ABUSE (AMMENT) (EU EXIT) REGULATIONS
2019/310
Tremor International Reports Record Results for the Three and
Six Months Ended June 30, 2021
-Programmatic Revenue increased 196% in Q2 driven by 280% growth
in CTV, representing strong organic growth
TEL-AVIV, Israel - August 19, 2021 - Tremor International Ltd.
(AIM/NASDAQ: TRMR) ("Tremor" or the "Company"), a global leader in
Video and Connected TV ('CTV') advertising, offering an end-to-end
technology platform that enables advertisers to reach relevant
audiences and publishers to maximize yield on their digital
advertising inventory, announced today its financial results for
the three and six months ended June 30, 2021.
"I am pleased to report that the first half of 2021 further
validated Tremor's strategy of developing an end-to-end technology
platform and our focus on Video, CTV and data. This impressive
revenue growth, which we believe is one of the highest across our
peer group, affirms our continued investment in product innovation
and business development," said Ofer Druker, Chief Executive
Officer of Tremor. "I am equally proud that the entirety of the
growth we achieved in the first half of 2021 was organic and as a
result of increased client spending on programmatic advertising.
Increasingly, Tremor is empowering our clients to deliver impactful
brand stories to targeted, relevant audiences globally."
Mr Druker concluded, "The successful capital raise through our
U.S. IPO and concurrent listing of our shares on NASDAQ in June
represents a milestone achievement for Tremor and a de-facto
endorsement from our shareholders."
Second Quarter 2021 Financial Highlights ($ in millions, except
per share amount)
Three months ended June
30 Six Months ended June 30
2021 2020 % 2021 2020 %
------- -------- ------- ------ ------------- ------------
IFRS highlights
Revenues 81.4 35.7 128% 152.4 74.3 105%
Programmatic Revenues 67.5 22.8 196% 123.2 50.0 146%
Operating Profit/(Loss) 21.2 (13.8) 254% 36.4 (31.5) 216%
Total Comprehensive
Income/(Loss) 24.4 (12.7) 293% 36.4 (29.6) 223%
Diluted EPS 0. 17 (0.09) 292% 0.26 (0.19) 234%
Non-IFRS highlights
Contribution ex-TAC 73.7 28.5 159% 136.7 60.6 126%
Adjusted EBITDA 37.3 1.2 2,930% 64.8 1.8 3,545%
Adjusted EBITDA
Margin 51% 4% 1,070% 47% 3% 1,516%
Non-IFRS net Income
(Loss) 32.8 (3.2) 1,111% 50.2 (5.7) 983%
Non-IFRS Diluted
EPS 0.23 (0.02) 1,054% 0.35 (0.04) 935%
Second Quarter and H1 Highlights
o Record Financial Performance Underpinned by Significant
Programmatic Activity
Strong growth in Programmatic activity reinforces the Company's
strategy to create an end-to-end platform while leveraging
technology, data and business intelligence. Momentum buoyed by
strong performance in video across all screens, fuelled by CTV:
o Q2 Contribution ex-TAC increased 159% to $73.7 million,
compared to Q2 2020
o H1 Contribution ex-TAC increased by 126% to $136.7 million
year-over-year
o Q2 Programmatic Revenue increased 196% to $67.5 million,
compared to Q2 2020, driven by continued strong performance in
CTV
o H1 Programmatic Revenue increased 14 6% to $ 123 .2 million
year-over-year
o Q2 Adjusted EBITDA increased 2,930% to $37.3 million
year-over-year, compared to Q2 2020
o H1 Adjusted EBITDA increased 3,545% to $64.8 million
year-over-year
o Continued Growth in CTV and Video Spending
CTV remains a strategic focus for Tremor as the industry
continues to shift towards programmatic buying.
o CTV Revenue grew by 280% to $20.9 million in Q2 2021, compared
to the same period in 2020
o CTV accounted for 28% of total Contribution ex-TAC in Q2 2021
compared to 19% in the same period in 2020
o Video represented 81% of total Contribution ex-TAC in H1 2021,
up from 69% in H1 2020
o Strengthened Balance Sheet and Exposure to U.S. Capital
Markets
o On June 22, 2021, Tremor successfully raised $128.6 million
(plus an additional $19.3 million in gross proceeds through
underwriters' exercising of its over-allotment option), before
deducting underwriting discounts and commissions when its American
Depositary Shares (ADSs) began trading on the NASDAQ Global Market
under the ticker symbol "TRMR."
o NASDAQ listing expected to provide the Company with greater
visibility in the marketplace and to better position it to raise
additional capital in the future.
o The Company intends to use the net proceeds from this offering
for working capital, general corporate purposes and to fund
incremental growth, including possible acquisitions in the
future
o Cash and cash equivalents of $275.5 million and zero debt as
of June 30, 2021
o Expanding Omnichannel Solution
Tremor empowers advertisers to complement their video campaigns
with premium listening environments through programmatic audio.
o Ability to run standard or tag-based audio campaigns with our
supply partners such as AdsWizz, Pandora and Spotify
o Ability to target smart speakers like Amazon Echo and Google
Home through connected device targeting
o Expanded Partnership Roster and Achieved Important Business
Wins
o New partnerships with Tegna, Rakuten Viki and A&E
o Completed support for LiveRamp's IdentityLink solution and
Unified ID 2.0 in the Exchange to facilitate industry initiatives
to support a cookie-less world
o Launched in-house TV retargeting and measurement solution that
provides brand advertisers the ability to reach and engage TV
viewing audiences at scale with Data-Driven Video Creative
(DDC)
o Tr.ly Creative has provided support this year to leading
brands that include: Amazon, The Home Depot, Walgreens, NewsUK
(including the Sun and Times Radio), Lego, Disney, McDonalds and
Norton
Financial Guidance
Our guidance assumes that the global economy continues to
recover and we do not have any major COVID-19-related setbacks that
may cause economic conditions to deteriorate or otherwise
significantly reduce advertiser demand. Accordingly, we estimate
the following:
Third Quarter 2021 outlook summary:
o Contribution ex-TAC of at least $75 million
o Adjusted EBITDA of approximately $37 million
Management remains confident in the medium to long-term
prospects of the Company with Tremor well-placed to further benefit
from the ongoing resurgence in the global digital advertising
industry.
Use of Non-IFRS Financial Information
In addition to our IFRS results, we review certain non-IFRS
financial measures to help us evaluate our business, measure our
performance, identify trends affecting our business, establish
budgets, measure the effectiveness of investments in our technology
and development and sales and marketing, and assess our operational
efficiencies. These non-IFRS measures include Contribution ex-TAC,
Adjusted EBITDA, Non-IFRS Income (Loss) and Non-IFRS Earnings
(Loss) per share, each of which is discussed below.
These non-IFRS financial measures are not intended to be
considered in isolation from, as substitutes for, or as superior
to, the corresponding financial measures prepared in accordance
with IFRS. You are encouraged to evaluate these adjustments, and
review the reconciliation of these non-IFRS financial measures to
their most comparable IFRS measures, and the reasons we consider
them appropriate. It is important to note that the particular items
we exclude from, or include in, our non-IFRS financial measures may
differ from the items excluded from, or included in, similar
non-IFRS financial measures used by other companies. See
"Reconciliation of Revenue to Contribution ex-TAC," "Reconciliation
of net loss to Adjusted EBITDA," "Reconciliation of net loss to
non-IFRS income (loss)," and "Reconciliation of IFRS loss per share
to non-IFRS income (loss) per share" included as part of this press
release.
o Contribution ex-TAC - Contribution ex-TAC is defined as our
gross profit plus depreciation and amortization attributable to
cost of revenues and cost of revenues (exclusive of depreciation
and amortization) minus the Performance media cost ("traffic
acquisition costs" or "TAC"). Contribution ex-TAC is a supplemental
measure of our financial performance that is not required by, or
presented in accordance with, IFRS. Contribution ex-TAC should not
be considered as an alternative to gross profit as a measure of
financial performance. Contribution ex-TAC is a non-IFRS financial
measure and should not be viewed in isolation. We believe
Contribution ex-TAC is a useful measure in assessing the
performance of Tremor International, because it facilitates a
consistent comparison against our core business without considering
the impact of traffic acquisition costs related to revenue reported
on a gross basis.
o
o Adjusted EBITDA - We define as total comprehensive income for
the period adjusted for foreign currency translation differences
for foreign operations, financing expenses, net, tax benefit,
depreciation and amortization, stock-based compensation,
restructuring, acquisition and IPO-related costs and other expenses
(income), net. Adjusted EBITDA is included in the press release
because it is a key metric used by management and our board of
directors to assess our financial performance. Adjusted EBITDA is
frequently used by analysts, investors and other interested parties
to evaluate companies in our industry. Management believes that
Adjusted EBITDA is an appropriate measure of operating performance
because it eliminates the impact of expenses that do not relate
directly to the performance of the underlying business
o Adjusted EBITDA margin - we define as Adjusted EBITDA as a
percentage of Contribution ex-TAC
o Non-IFRS Income (Loss) and Non-IFRS Earnings (Loss) per Share
- We define non-IFRS earnings (loss) per share as non-IFRS income
(loss) divided by non-IFRS weighted-average shares outstanding.
Non-IFRS income (loss) is equal to net income (loss) excluding
stock-based compensation, cash and non-cash based acquisition and
related expenses, including amortization of acquired intangible
assets, merger related severance costs, transaction expenses. In
periods in which we have non-IFRS income, non-IFRS weighted-average
shares outstanding used to calculate non-IFRS earnings per share
includes the impact of potentially dilutive shares. Potentially
dilutive shares consist of stock options, restricted stock awards,
restricted stock units, and potential shares issued under the
Employee Stock Purchase Plan, each computed using the treasury
stock method. We believe non-IFRS earnings (loss) per share is
useful to investors in evaluating our ongoing operational
performance and our trends on a per share basis, and also
facilitates comparison of our financial results on a per share
basis with other companies, many of which present a similar
non-IFRS measure. However, a potential limitation of our use of
non-IFRS earnings (loss) per share is that other companies may
define non-IFRS earnings (loss) per share differently, which may
make comparison difficult. This measure may also exclude expenses
that may have a material impact on our reported financial results.
Non-IFRS earnings (loss) per share is a performance measure and
should not be used as a measure of liquidity. Because of these
limitations, we also consider the comparable IFRS measure of net
income (loss)
First Half 2021 Financial Results Webcast and Conference Call
Details
Webcast Details:
-- Tremor International Q2 2021 and H1 2021 Earnings Webcast
-- Thursday, August 19, 2021 at 6:00 AM (PT) / 9:00 AM (ET) and 2:00 PM (BST)
-- A live and archived webcast will be made available via Tremor's Investor Relations website at
https://investors.tremorinternational.com/events/event-details/tremor-international-second-quarter-2021-and-h1-2021-earnings-webcast
-- A full transcript of the webcast will also be made available
on the Company's website today ahead of the webcast commencing
Participant Dial-In Number:
-- US/CANADA Participant Toll-Free Dial-In Number: (844) 692-7011
-- INTERNATIONAL Participant Dial-In Number: (929) 517-0922
-- Conference ID: 3026147
For further information please contact:
Tremor International Ltd via Vigo Consulting
Ofer Druker, Chief Executive Officer
Sagi Niri, Chief Financial Officer
finnCap Ltd Tel: +44 20 7220 0500
Jonny Franklin-Adams / James Thompson (Corporate
Finance)
Tim Redfern / Dicky Chambers (ECM)
Stifel Nicolaus Europe Limited Tel: +44 20 7710 7600
Fred Walsh / Alain Dobkin / Nick Adams /
Richard Short
Vigo Consulting Tel: +44 20 7390 0230
Jeremy Garcia / Antonia Pollock
U.S Investor Relations
Todd Fromer
KCSA Strategic Communications
tfromer@kcsa.com
About Tremor International
Tremor is a global company offering an end-to-end technology
advertising platform, operating across three core capabilities -
Video, Data and CTV. Tremor's unique approach is centered on
offering a full stack of end-to-end solutions which provides it
with a major competitive advantage within the video advertising
ecosystem.
Tremor Video helps advertisers deliver impactful brand stories
across all screens through the power of innovative video technology
combined with advanced audience data and captivating creative
content. Tremor Video's innovative video advertising technology has
offerings in CTV, in-stream, out-stream and in-app.
The media side of Tremor, Unruly, drives real business outcomes
in multiscreen advertising. Its programmatic platform efficiently
and effectively delivers performance, quality, and actionable data
to demand and supply-focused clients and partners. Tremor has a
meaningful number of direct integrations with publishers, unique
demand relationships with a variety of advertisers and privileged
access to News Corp inventory. Unruly connects to the world's
largest DSPs and is compatible with most Ad Age top 100 brands.
Tremor is headquartered in Israel and maintains offices
throughout the United States, Canada, Europe, Asia-Pacific and
Australia and is traded on the London Stock Exchange (AIM: TRMR)
and NASDAQ (TRMR).
Forward Looking Statements
This press release contains forward-looking statements,
including forward-looking statements within the meaning of Section
27A of the United Stated Securities Act of 1933, as amended, and
Section 21E of the United States Securities and Exchange Act of
1934, as amended. Forward-looking statements are identified by
words such as "anticipates," "believes," "expects," "intends,"
"may," "can," "will," "estimates," and other similar expressions.
However, these words are not the only way Tremor identifies
forward-looking statements. All statements contained in this press
release that do not relate to matters of historical fact should be
considered forward-looking statements, including without limitation
statements regarding the continued shift in the industry towards
programmatic buying, the growth of CTV, benefits of any of Tremor's
commercial partnerships and any other statements related to
Tremor's future financial results. These statements are neither
promises nor guarantees but involve known and unknown risks,
uncertainties and other important factors that may cause Tremor's
actual results, performance or achievements to be materially
different from its expectations expressed or implied by the
forward-looking statements, including, but not limited to, the
following: negative global economic conditions, potential negative
developments in the COVID-19 pandemic and how those developments
may adversely impact Tremor's business, customers and the markets
in which Tremor competes, changes in industry trends, other
negative developments in Tremor's business or unfavourable
legislative or regulatory developments. Tremor cautions you not to
place undue reliance on these forward-looking statements. For a
more detailed discussion of these factors, and other factors that
could cause actual results to vary materially, interested parties
should review the risk factors listed in Tremor's Registration
Statement on Form F-1, which was filed with the U.S. Securities and
Exchange Commission ( www.sec.gov ) on June 17, 2021. Any
forward-looking statements made by Tremor in this press release
speak only as of the date of this press release, and Tremor does
not intend to update these forward-looking statements after the
date of this press release, except as required by law.
Tremor , and the Tremor logo are trademarks of Tremor
International Ltd. in the United States and other countries. All
other trademarks are the property of their respective owners. The
use of the word "partner" or "partnership" in this press release
does not mean a legal partner or legal partnership.
Adjusted EBITDA Reconciliation
Three months ended June Six Months ended June
30 30
-------------------------------- ----------------------------
2021 2020 % 2021 2020 %
---------- ----------- ------- -------- --------- -------
($ in thousands)
Net Income (Loss) 24,069 (11,782) 304% 36,943 (26,041) 242%
Taxes on income (3,427) (1,888) (1,838) (4,471)
Financial expense
(income), net 599 (114) 1,311 (1,002)
Depreciation and
amortization 10,029 10,563 19,912 22,023
Stock-based compensation 2,610 3,333 4,951 8,561
Restructuring & Acquisition
costs 314 1,120 434 2,709
IPO related one-time
costs 3,133 -- 3,133 --
---------- ----------- ------- -------- --------- -------
Adjusted EBITDA 37,327 1,232 2,930% 64,846 1,779 3,545%
Contribution ex-TAC Reconciliation
Three months ended Six Months ended June
June 30 30
----------------------------- ---------------------------
2021 2020 % 2021 2020 %
---------- ---------- ----- --------- --------- -----
($ in thousands)
Revenues 81,379 35,685 128% 152,388 74,296 105%
Cost of revenues (exclusive
of depreciation and
amortization) (17,238) (15,227) (34,930) (28,485)
Depreciation and amortization
attributable to Cost
of Revenues (4,012) (4,729) (8,199) (9,736)
Gross profit (IFRS) 60,129 15,729 282% 109,259 36,075 203%
Depreciation and amortization
attributable to Cost
of Revenues 4,012 4,729 8,199 9,736
Cost of revenues (exclusive
of depreciation and
amortization) 17,238 15,227 34,930 28,485
Performance media
cost (7,632) (7,178) 6% (15,653) (13,677) 14%
Contribution ex-TAC
(Non-IFRS) 73,747 28,507 159% 136,735 60,619 126%
Non-IFRS Net Income Reconciliation
Three months ended June Six Months ended June
30 30
------------------------------ ---------------------------
2021 2020 % 2021 2020 %
--------- ---------- ------- -------- ---------- -----
($ in thousands)
Net Income (Loss) 24,069 (11,782) 304% 36,943 (26,041) 242%
Acquisition and related
items, including
amortization of acquired
intangibles and restructuring 7,065 7,531 13,653 15,561
Stock-based compensation
expense 2,610 3,333 4,951 8,561
IPO related one-time
costs 3,133 -- 3,133 --
Tax effect of Non-GAAP
adjustments (1) (4,117) (2,323) (8,442) (3,771)
N on-IFRS Income
(Loss) 32,760 (3,241) 1,111% 50,238 (5,690) 983%
Weighted average
shares outstanding-diluted
(in millions) (2) 143.8 135.6 142.1 134.4
Non-IFRS diluted
EPS (in USD) 0.23 (0.02) 1,054% 0.35 (0.04) 935%
(1) Non-IFRS income (loss) includes the estimated tax impact
from the expense items reconciling between net loss and non-IFRS
income (loss)
(2) Non-IFRS earnings (loss) per share is computed using the
same weighted-average number of shares that are used to compute
GAAP earnings (loss) per share in periods where there is both a
non-GAAP loss and a GAAP net loss
Review Report of the Independent Auditors to the Shareholders of
Tremor International Ltd.
Introduction
We have reviewed the accompanying financial information of
Tremor International Ltd. and its subsidiaries (hereinafter - "the
Company") comprising the condensed consolidated interim statement
of financial position as of June 30, 2021, the related condensed
consolidated interim statements of comprehensive income for the six
and three month periods then ended and the related condensed
consolidated interim statements of changes in equity and cash flows
for the six-month period then ended. The Board of Directors and
Management are responsible for the preparation and presentation of
this interim financial information in accordance with IAS 34
"Interim Financial Reporting". Our responsibility is to express a
conclusion on this interim financial information based on our
review.
Scope of Review
We conducted our review in accordance with Standard on Review
Engagements (Israel) 2410 , "Review of Interim Financial
Information Performed by the Independent Auditor of the Entity" of
the Institute of Certified Public Accountants in Israel. A review
of interim financial information consists of making inquiries,
primarily of persons responsible for financial and accounting
matters, and applying analytical and other review procedures.
A review is substantially less in scope than an audit conducted
in accordance with generally accepted auditing standards in Israel
and consequently does not enable us to obtain assurance that we
would become aware of all significant matters that might be
identified in an audit. Accordingly, we do not express an audit
opinion.
Conclusion
Based on our review, nothing has come to our attention that
causes us to believe that the accompanying financial information
was not prepared, in all material respects, in accordance with IAS
34.
Somekh Chaikin
Member Firm of KPMG International
August 19 , 2021
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL
POSITION
(Unaudited )
December
June 30 31
2021 2020
--------- ---------
USD thousands
--------------------
Assets
ASSETS :
Cash and cash equivalents 275,544 97,463
Trade receivables, net 139,676 153,544
Other receivables 17 ,138 17,6 15
Current tax assets 1,507 2 , 029
--------- ---------
TOTAL CURRENT ASSETS 433,865 270,651
--------- ---------
Fixed assets, net 3,003 3 , 292
Right-of-use assets 16,330 18,657
Intangible assets, net 210,854 224,500
Deferred tax assets 35,408 31,717
Other long term assets 1,630 1,834
--------- ---------
TOTAL NON-CURRENT ASSETS 267,225 280,000
--------- ---------
TOTAL ASSETS 701,090 550,651
========= =========
Liabilities and shareholders' equity
LIABILITIES:
Current maturities of lease liabilities 7,230 9,047
Trade payables 133,045 125,863
Other payables 43,909 47,122
Current tax liabilities 4,379 3 , 162
--------- ---------
TOTAL CURRENT LIABILITIES 188,563 185,194
--------- ---------
Employee benefits 501 49 5
Long-term lease liabilities 10,461 12,162
Deferred tax liabilities 12,821 15,963
Other long term liabilities 4,5 42 7,824
--------- ---------
TOTAL NON-CURRENT LIABILITIES 28,325 36,444
--------- ---------
TOTAL LIABILITIES 216,888 221,638
--------- ---------
SHAREHOLDERS' EQUITY:
Share capital 429 380
Share premium 383, 457 264,831
Other comprehensive income 2,837 3,330
Retained earnings 97,479 60,472
--------- ---------
TOTAL SHAREHOLDERS' EQUITY 484,202 329,01 3
--------- ---------
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY 701,090 550,651
========= =========
Chairman of the Chief Executive Chief Finance Officer
Board of Directors Officer
Date of approval of the financial statements: August 19 , 20 2
1
The accompanying notes are an integral part of these Condensed
consolidated interim financial statements.
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF OPERATION AND OTHER
COMPREHENSIVE INCOME
(Unaudited)
Six months ended Three months ended
June 30 June 30
-------------------- ---------------------
2021 *2020 2021 2020
--------- --------- --------- ----------
USD thousands USD thousands
152 ,
Revenues 388 74,296 81,379 35,685
Expenses:
Cost of Revenues (Exclusive of depreciation 28,48
and amortization shown separately below) 34 , 930 5 17,238 15,227
Research and development expenses 6,808 6,484 3,405 2,963
Selling and marketing expenses 36,519 33,010 18,469 14,841
General and administrative expenses 18,003 15,808 11,197 5,875
Depreciation and amortization** 19,912 22,023 10,029 10,563
( 200
Other Income (200) - ) -
115,97
Total Expenses 2 105,810 60, 138 49,469
--------- --------- --------- ----------
36,41 21 ,
Operating Profit (Loss) 6 (31,514) 241 (13,784)
========= ========= ========= ==========
Financing income (173) (1,362) (87) (258)
Financing expenses 1, 484 360 686 144
--------- --------- --------- ----------
Financing expenses (income), net 1, 311 (1,002) 599 (114)
--------- --------- --------- ----------
Profit (Loss) before taxes on income 35, 105 (30,512) 20, 642 (13,670)
Tax benefit 1,838 4,471 3,427 1,888
--------- --------- --------- ----------
Profit (loss) for the period 36,943 (26,041) 24,069 (11,782)
========= ========= ========= ==========
Other comprehensive income items:
Foreign currency translation differences ( 493
for foreign operation ) (3,511) 343 (878)
--------- --------- --------- ----------
( 493
Total other comprehensive income (loss) ) (3,511) 343 (878)
--------- --------- --------- ----------
Total comprehensive income (loss) 36,450 (29,552) 24,412 (12,660)
========= ========= ========= ==========
Earnings (loss) per share
Basic earnings (loss) per share (in
USD) 0.272 (0.194) 0.175 (0.087)
Diluted earnings (loss) per share (in
USD) 0.260 (0.194) 0. 167 (0.087)
* Restated. See Note 1a.
** Comparative information has been reclassified. Depreciation
and amortization is mainly attributed to
intangible assets and right-of-use assets. See note 2c.
The accompanying notes are an integral part of these condensed
consolidated interim financial statements.
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN
EQUITY
(Unaudited)
Share Share Other comprehensive Retained
capital premium income Earnings Total
--------- --------- -------------------- ---------- ---------
USD thousands
-----------------------------------------------------------------
Balance as of January
1, 2021 380 264,831 3,330 60,472 329,013
Total Comprehensive
income (loss) for
the period
Profit for the period - - - 36,943 36,943
Other comprehensive
Income:
Foreign Currency
Translation - - ( 493 ) - ( 493 )
--------- --------- -------------------- ---------- ---------
Total comprehensive
Income (loss) for
the period - - ( 493 ) 36,943 36,450
--------- --------- -------------------- ---------- ---------
Transactions with
owners, recognized
directly in equity
Revaluation of liability
for put option on
non- controlling
interests - - - 64 64
Issuance of shares
net of issuance costs
of $ 11.9million 41 118,054 118,095
Own shares acquired (3) (6,640) - - (6,643)
Share based payments - 6,912 - - 6,912
Exercise of share
options 11 300 - - 311
--------- --------- -------------------- ---------- ---------
Balance as of June
30, 2021 429 383,457 2, 837 97,479 484,202
========= ========= ==================== ========== =========
Balance as of January
1, 2020 351 240,989 494 58,778 300,612
Total Comprehensive
loss for the period
( 26,041 ( 26,041
Loss for the period - - - ) )
Other comprehensive
Income:
Foreign currency ( 3,51
translation - - ( 3,51 1) - 1)
--------- --------- -------------------- ---------- ---------
Total comprehensive ( 26,041 ( 29,552
loss for the period - - ( 3,51 1) ) )
--------- --------- -------------------- ---------- ---------
Transactions with
owners, recognized
directly in equity
Own shares acquired (8) (5,172) - - (5,180)
Issuance of shares
in Business Combination 25 14,092 - - 14,117
Share based payments - 8,346 - - 8,346
Revaluation of liability
for put option on
non-controlling interests (110) (110)
Exercise of share
options 12 548 - - 560
--------- --------- -------------------- ---------- ---------
Balance as of June 32,6 288,79
30, 2020 380 258,803 (3,017) 27 3
========= ========= ==================== ========== =========
The accompanying notes are an integral part of these condensed
consolidated interim financial statements.
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS
(Unaudited)
Six months ended
June 30
-------------------
2021 2020
-------- ---------
USD thousands
-------------------
CASH FLOWS FROM OPERATING ACTIVITIES :
(26, 041
Profit (loss) for the period 36,943 )
Adjustments for:
Depreciation and amortization 19,912 22,02 3
(1,13 1
Net financing expense (income) 1, 235 )
Loss on sale of fixed assets 6 -
Gain on leases change contracts (307) (2,843)
Share-based payment 4,951 8,561
Gain on sale of business unit (200) -
( 1,838 ( 4,471
Tax benefit ) )
Change in trade and other receivables 15, 677 43,244
( 31,849
Change in trade and other payables 259 )
Change in employee benefits 4 ( 40 )
Income taxes received 1,940 903
( 1,047
Income taxes paid (1,680) )
Interest received 170 290
Interest paid (311) ( 404 )
-------- ---------
Net cash provided by operating activities 76, 761 7,195
-------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES
Change in pledged deposits (205) 185
Leases Receipt 1,625 1,279
Repayment of long-term loans - 817
Acquisition of fixed assets (1,770) ( 393 )
Acquisition and capitalization of intangible ( 2,438
assets (2,484) )
Acquisition of subsidiaries, net of cash
acquired - 6, 227
Proceeds from sale of business unit 152 -
Net cash provided by (used in) investing
activities (2,682) 5,677
-------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES
Acquisition of own shares (6,643) (5,180)
Issuance of shares, net of issuance costs 118,446 -
Payment of call/put option (2,414) -
Proceeds from exercise of share options 311 560
Leases repayment (5,537) (8,058)
-------- ---------
Net cash provided by (used in) financing
activities 104,163 (12,678)
-------- ---------
178,24
Net increase in cash and cash equivalents 2 194
======== =========
CASH AND CASH EQUIVALENTS AS OF THE BEGINNING
OF PERIOD 97,463 79,047
EFFECT OF EXCHANGE RATE ON CASH AND CASH
EQUIVALENTS (16 1 ) (98)
-------- ---------
CASH AND CASH EQUIVALENTS 275,544 79,143
======== =========
The accompanying notes are an integral part of these condensed
consolidated interim financial statements.
NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
NOTE 1: GENERAL
a. Reporting entity:
Tremor International Ltd. (the "Company" or "Tremor
International"), formerly known as Taptica International Ltd., was
incorporated in Israel under the laws of the State of Israel on
March 20, 2007. The ordinary shares of the C ompany are listed on
the AIM Market of the London Stock Exchange and the American
Depositary Shares ("ADSs") each of which represents two ordinary
shares of the Company, represented by the American Depositary
Receipts ("ADR") are listed on the Nasdaq Capital Market (see Note
1d) . The address of the registered office is 82 Yigal Alon Street
Tel-Aviv, 6789124, Israel.
Tremor International is a global C ompany offering an end-to-end
software platform that supports a wide range of media types (e.g.,
video, display, etc.) and devices (e.g., mobile, Connected TVs,
streaming devices, desktop, etc.), creating an efficient
marketplace where advertisers (buyers) are able to purchase high
quality advertising inventory from publishers (sellers) at scale.
Tremor Video Inc. ("Tremor Video"), a wholly owned subsidiary, is
the Company's Demand Side Platform ("DSP") providing full-service
and self-managed marketplace access to advertisers and agencies in
order to execute their digital marketing campaigns in real time
across various ad formats. Unruly Group, LLC ( Former name
RhythmOne, LLC), provide access to the Sell Side Platform ("SSP")
which is designed to monetize digital inventory for publishers and
app developers by enabling their content to have the necessary code
and requirements for programmatic advertising integration. The SSP
provides access to significant amounts of data, unique demand, and
a comprehensive product suite to drive more effective inventory
management and revenue optimization. The Company also provides a
Data Management Platform ("DMP") solution which integrates both DSP
and SSP solutions enabling advertisers and publishers to use data
from various sources in order to optimize results of their
advertising campaigns.
Tremor International Ltd. is headquartered in Israel and
maintains offices throughout the US, Canada, EMEA and
Asia-Pacific.
b. On April 1, 2019, the Company completed an acquisition
transaction with RhythmOne and on January 4, 2020, the Company
completed an acquisition transaction with Unruly. Following the
acquisition of RhythmOne and Unruly, the Company invested and
developed capabilities both in the DSP and SSP solutions which
launched in 2020 to offer an end-to-end platform that provides
customers access to an advertising marketplace in an efficient and
scalable manner utilizing machine learning, artificial intelligence
and advanced algorithms As a result of those acquisitions and their
influence on the Company's operation and other changes in the
industry practice, the Company has changed revenue presentation as
of 2020 to a net basis with respect to its programmatic activity
(see Note 3K in annual financial statements). Consequently,
comparative information has been restated to correct the error as
follows:
Six months ended
June 30 2020(unaudited)
-----------------------------------------------
As presented
in the Effect As presented
past of in
financial retrospective these financial
statements adjustment statements
------------- -------------- ----------------
USD thousand
-----------------------------------------------
Revenues 136,500 62,204 74,296
Cost of revenues 90,689 62,204 28,48 5
c. The COVID-19 pandemic continues to create business and
economic uncertainty and volatility and is expected to continue to
impact the global economy, disrupted global supply chains and work
force participation and created volatility and disruption of
financial markets impacted mainly the Company's operation during
the first half of fiscal year 2020. The extent of the impact of
COVID-19 pandemic on the Company's operational and financial
performance is monitoring by the Company and will depend on future
developments, which are highly uncertain and cannot be predicted,
including but not limited to, the duration and spread of the
pandemic.
d. Material events in the reporting period:
On June 22, 2021, the Company completed its initial public
offering in the U.S. of 6,768,953 American Depositary Shares
("ADSs"), at a public offering price of $19.00 per ADS, for
aggregate proceeds of $128.6 million before deducting underwriting
discounts and commissions (the "Nasdaq IPO"). Each ADS represents
two Ordinary Shares of the Company. The ADSs began trading on the
Nasdaq Global Market on June 18, 2021, under the ticker symbol
"TRMR". The Company also granted the underwriters of the Nasdaq IPO
a 30-day option to purchase additional up to 1,015,342 ADSs from
the Company at the initial public offering price of $19.00 per ADS,
which the underwriters subsequently exercised in full on July 15,
2021. See Note 9 .
Effective upon completion of the Nasdaq IPO, on June 22, 2021,
the Company granted an aggregate of 4,725,000 Restricted Share
Units ("RSUs") and 2,025,000 Performance Share Units ("PSUs") to
its three Executive Directors, Ofer Druker, Yaniv Carmi and Sagi
Niri, pursuant to the terms of the Company's 2017 Equity Incentive
Plan and the Company's Global Share Incentive Plan (2011). The
grant of the RSUs and PSUs awards was approved by the Company's
shareholders on April 30, 2021 (subject to the completion of the
Nasdaq IPO). The RSU awards vest gradually over a period of three
years, with 8.33% of each such grant vesting each quarter, subject
to the executive continuing to be employed by a Company group
member on the applicable vesting date. The PSU awards vest
gradually over a period of three years, with 33.33% of each grant
vesting each year, subject to (i) the executive continuing to be
employed by a Company group member on the applicable vesting date,
and (ii) compliance with performance-based metrics determined by
the Compensation Committee of the Board of Directors of the
Company.
The fair value of each RSU and PSU granted to the Executive
Directors as of April 30, 2021, is 720 pence (approximately $10.02)
per Ordinary Share, based on the market value of the Company's
quoted Ordinary Shares on AIM.
The estimated aggregated cost of the 4,725,000 RSUs and
2,025,000 PSUs awards, assuming 100% vesting, will be approximately
$67 million over the three-year vesting period commencing June 22,
2021.
In addition, effective upon completion of the Nasdaq IPO on June
22, 2021, the Company's three Executive Directors are entitled to a
special bonus in recognition for their special contribution to the
completion of the Nasdaq IPO in the amount of $500,000, as approved
by the Company's shareholders on April 30, 2021 (subject to the
completion of the Nasdaq IPO). The special bonuses payable to the
Executive Directors were part of an aggregate $3 million special
bonus for the Company executives and employees, as approved and
allocated by the Company's Board of Directors (out of an aggregate
$5 million that was initially approved).
On April 22, 2021, the Company's shareholders also approved an
increase of 6,500,000 Ordinary Shares to the aggregate available
pool of the Company's 2017 Equity Incentive Plan and the Company's
Global Share Incentive Plan (2011) (with 80% of the increase
allocated to the 2017 Plan and 20% of the increase allocated to the
2011 Plan).
e. Definitions :
In these financial statements -
The Company - Tremor International Ltd and its subsidiaries
Subsidiaries - Companies, the financial statements of
which are fully consolidated, directly
or indirectly, with the financial statements
of the Company such as Unruly Group, LLC,
Unruly Holding Ltd, Tremor Video Inc.
Related party - As defined by IAS 24, "Related Party Disclosures".
NOTE 2: BASIS OF PREPARATION
a. Statement of compliance:
The condensed consolidated interim financial statements have
been prepared in accordance with IAS 34 Interim Financial Reporting
and do not include all the information required for full annual
financial statements. They should be read in conjunction with the
financial statements for the year ended December 31, 2020
(hereinafter - "the annual financial statements").
The condensed consolidated interim financial statements were
authorized for issue by the Company's Board of Directors on August
19 , 2021.
b. Use of estimates and judgments:
The preparation of financial statements in conformity with IFRS
requires management of the Company to make judgments, estimates and
assumptions that affect the application of accounting policies and
the reported amounts of assets, liabilities, income, and expenses.
Actual results may differ from these estimates.
The preparation of accounting estimates used in the preparation
of the Company's financial statements requires management of the
Company to make assumptions regarding circumstances and events that
involve considerable uncertainty. Management of the Company
prepares estimates on the basis of past experience, various facts,
external circumstances, and reasonable assumptions according to the
pertinent circumstances of each estimate.
Estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognized in the
period in which the estimates are revised and in any future periods
affected.
c. Classification of expenses:
The Company reclassified the depreciation and amortization
expenses that is mainly attributed to intangible assets and
right-of-use assets to a separate line in the statements of
operation and other comprehensive income named: "Depreciation and
amortization". Management believes that presenting depreciation and
amortization separately is more meaningful and relevant to an
understanding of the Company's financial performance.
NOTE 3: SIGNIFICANT ACCOUNTING POLICIES
The accounting policies applied by the Company in these
condensed consolidated interim financial statements are the same as
those applied by the Company in its annual financial statements,
there was no change in accounting policies or any new relevant
standards during the quarter.
NOTE 4: SHAREHOLDERS' EQUITY
Issued and paid-in share capital:
Or dinary Shares
---------------------------
2021 2020
------------- ------------
Number of shares
---------------------------
Balance as of January 1 133,916,229 124,223,182
( 917,998
Own shares held by the Group ) (2,833,395)
Share based compensation 3,741,234 4,170,129
Issuance of shares in IPO * 13,537,906 -
Shares issued in business combination
** - 8,525,323
------------- ------------
Issued and paid-in share capital
as of June 30 1 50,277,371 134,085,239
============= ============
Authorized share capital 500 ,000,000 300,000,000
============= ============
Rights attached to share:
The holders of ordinary shares are entitled to receive dividends
as declared from time to time and are entitled to one vote per
share at general meetings of the Company. All shares rank equally
with regard to the Company's residual assets.
Issuing new public shares:
* See Note 1b
**Following the acquisition of Unruly, the Company issued
8,525,323 shares at a quoted price of GBP 1 .51 (USD 1.98) per
share to former Unruly shareholders which became admitted to
trading on AIM on January 10, 2020, and are subject to a 18-months
lock-up.
NOTE 5 : EARNINGS (LOSS) PER SHARE
Basic earnings (loss) per share:
The calculation of basic earnings (loss) per share for the six
and three months periods ended June 30, 2021 and 2020 was based on
the profit for the periods divided by a weighted average number of
ordinary shares outstanding, calculated as follows:
Profit for the period:
Six months ended
June 30 (unaudited)
-----------------------
2021 2020
---------- -----------
USD thousands
-----------------------
Profit (loss) for the period 36,943 (26,041)
========== ===========
Three months ended
June 30 (unaudited)
-----------------------
2021 2020
---------- -----------
USD thousands
-----------------------
Profit (loss) for the period 24,069 (11,782)
========== ===========
Weighted average number of ordinary shares:
Six months ended
June 30 (unaudited)
-------------------------
2021 2020
----------- ------------
Shares of NIS
-------------------------
0.01 par value
-------------------------
Weighted average number of ordinary
shares used to calculate basic earnings 1 36 , 033
per share as of June 30 , 008 134,369,723
=========== ============
Basic earnings (loss) per share
(in USD) 0. 272 (0.194)
=========== ============
Three months ended
June 30 (unaudited)
--------------------------
2021 2020
------------ ------------
Shares of NIS
--------------------------
0.01 par value
--------------------------
Weighted average number of ordinary
shares used to calculate basic earnings
per share as of June 30 137,645,630 135,620,865
============ ============
Basic earnings (loss) per share
(in USD) 0.175 (0.087)
============ ============
Diluted earnings (loss) per share:
The calculation of diluted earnings (loss) per share for the six
and three months period ended June 30, 2021 and 2020 was based on
profit or for the period divided by a weighted average number of
shares outstanding after adjustment for the effects of all dilutive
potential ordinary shares, calculated as follows:
Weighted average number of ordinary shares (diluted):
Six months ended
June 30 (unaudited)
-------------------------
2021 2020
----------- ------------
Shares of NIS
-------------------------
0.01 par value
-------------------------
Weighted average number of ordinary
shares used to calculate basic 1 36 , 033
earnings per share , 008 134,369,723
Effect of share options issued 6 ,084,840 -
----------- ------------
Weighted average number of ordinary
shares used to calculate diluted 142,1 1 7
earnings per share ,848 134,369,723
=========== ============
Diluted earnings (loss) per share
(in USD) 0. 260 ( 0.194 )
=========== ============
Three months ended
June 30 (unaudited)
--------------------------
2021 2020
------------ ------------
Shares of NIS
--------------------------
0.01 par value
--------------------------
Weighted average number of ordinary
shares used to calculate basic
earnings per share 137,645,630 135,620,865
Effect of share options issued 6,112,829
------------ ------------
Weighted average number of ordinary
shares used to calculate diluted
earnings per share 143,758,459 135,620,865
============ ============
Diluted earnings (loss) per share
(in USD) 0. 167 (0.087)
============ ============
NOTE 6: SHARE-BASED PAYMENT ARRANGEMENTS
a. Share-based compensation plan:
The terms and conditions related to the grants of the share
options programs are as follows:
-- All the share options that were granted are non-marketable.
-- All options are to be settled by physical delivery of ordinary shares or ADSs.
-- Vesting conditions are based on a service period of between 0.5- 4 years.
b. Stock Options:
The number of share options is as follows :
Weighted average
Number of options exercise price
-------------------- -------------------
2021 2020 2021 2020
-------- ---------- --------- --------
(Thousands) (GBP)
-------------------- -------------------
Outstanding of
1 January 3,781 4,828
Forfeited (102) (1,473) 1.6 2.76
Exercised (167) (729) 1.35 0.47
Granted - 1,551 - 1.58
Outstanding of
June 30 3,512 4,177
======== ==========
Exercisable of
June 30 214 535
======== ==========
In January 2020, the Company's Board of Directors approved a
change in the exercise price and vesting terms relating to
2,204,174 options for ordinary shares held by certain employees
(the "Amended Options"), as follows:
Originally granted Amended Granted
------------------------- ---------------------
Exercise Exercise
Grated Number price Exercisable price Exercisable
date of options (GBP) date from (GBP) date from
-------------- ----------- ---------- ------------- -------- -----------
March 20, March 20, July 28,
2017 217,000 2.44 2019 1.60 2021
July 28,
June 18, 2017 116,000 2.99 June 18, 2019 1.60 2021
November 5, November 5, July 28,
2017 391,000 4.31 2019 1.60 2021
January 23, January 23, July 31,
2018 1,163,000 4.37 2020 1.60 2021
July 31,
June 20, 2018 52,000 4.37 June 20, 2020 1.60 2021
July 28,
April 2, 2019 265,174 2.06-18.27 April 2, 2019 1.60 2021
The options that had a vesting date up to July 2021 will now
vest and become exercisable on July 2021, while the vesting and
exercise periods of the rest of the options remain unchanged. The
incremental fair value (amounting to USD 1,282 thousand) is
recognized over the remaining vesting period. The new expiration
date is one year after the last exercise date.
c. Information on measurement of fair value of share-based payment plans:
The total expense recognized in the six months period ended June
30 , 2021 and 2020 with respect to the options granted to
employees, amounted to approximately USD 718 thousand and USD
1,291, respectively.
The total expense recognized in the three months period ended
June 30, 2021 and 2020 with respect to the options granted to
employees, amounted to approximately USD 294 thousand and USD 626,
respectively.
d. Restricted Share Units (RSU):
The number of restricted share units is as follows :
Weighted-Average
Number of RSU's Grant Date Fair Value
----------------- ------------------------
2021 2020 2021 2020
-------- ------- ----------- -----------
(Thousands)
-----------------
Outstanding at 1
January 3,777 3,969 2.364 2.372
Forfeited (12) (45) 6.071 3.922
Exercised (1,656) (1,822) 2.145 2.216
Granted 4,76 5 1,909 10.017 2. 4 13
Restricted stock
units assumed in
acquisition during
the period - 415 - 2. 592
-------- -------
Outstanding at June
30 6,874 4,426 2.752 2.418
======== =======
The total expense recognized in the six months period ended June
30 , 2021 and 2020 with respect to the RSU granted to employees,
amounted to approximately USD 2,767 and USD 4,696 thousand,
respectively.
The total expense recognized in the three months period ended
June 30, 2021 and 2020 with respect to the RSU granted to
employees, amounted to approximately USD 1,676 and USD 1,985
thousand, respectively.
Please see Note 1d regarding RSU's grant to its executive
directors.
e. Performance Stock Units (PSU):
The number of performance stock units is as follows :
Weighted-Average
Number of PSU's Grant Date Fair Value
------------------ ------------------------
2021 2020 2021 2020
--------- ------- ------------ ----------
(Thousands)
------------------
Outstanding of January
1 3,852 5,071 2.155 2.105
Forfeited (90) (181) 2.429 2.389
Exercised ( 1 ,918) (1,738) 2.408 2.402
Granted 2,065 725 10.010 2.590
--------- -------
Outstanding of June
30 3,909 3,877 8.652 2.265
========= =======
The vesting of the PSU's is subject to continues employment and
compliance with the performance criteria determined by the
Company's Remuneration Committee and the Company's Board of
Directors.
Please see Note 1 d regarding PSU's grant to its executive
directors.
The total expense recognized in six months ended June 30, 2021
and 2020 with respect to the PSU granted to employees, amounted to
approximately USD 1,466 thousand and USD 2,574 thousand,
respectively.
The total expense recognized in three months ended June 30, 2021
and 2020 with respect to the PSU granted to employees, amounted to
approximately USD 640 thousand and USD 722 thousand,
respectively.
f. Share based expense recognized in the statements of operation
and other comprehensive income is as follows:
Six months ended
June 30 (unaudited)
-----------------------
2021 2020
----------- ----------
USD thousands
-----------------------
Selling and marketing 1,112 2,975
Research and development 263 182
General and administrative 3,576 5,404
----------- ----------
4,951 8,561
=========== ==========
Three months ended
June 30 (unaudited)
-----------------------
2021 2020
----------- ----------
USD thousands
-----------------------
Selling and marketing 425 1,052
Research and development 120 160
General and administrative 2,065 2,121
----------- ----------
2,610 3,333
=========== ==========
Note 7 - Subsidiaries
Business combination from a prior period that was measured at
provisional amounts .
On January 4, 2020, the Company completed the acquisition of
Unruly Holdings Limited and Unruly Media Inc. from News Corp UK
& Ireland Limited (UK Seller) and News Preferred Holdings Inc.
(US Seller) for total consideration of: (i) issuance of 7,960,111
Ordinary Shares of the Company to the UK Seller in exchange for a
loan in the amount of GBP 12,020 thousand (USD 15,729 thousand)
between UK Seller (as lender) and Unruly Group Limited (as
borrower); (ii) GBP 1 to UK Seller for 100% of the issued share
capital of Unruly Holdings Limited; and (iii) issuance of 565,212
Ordinary Shares of the Company to the US Seller and USD 1 for 100%
of the issued share capital of Unruly Media Inc.
The financial statements of the Company as of June 30, 2020,
included provisional amounts. Upon completing the independent
valuation for the business combination, immaterial amounts were
retrospectively adjusted.
NOTE 8: OPERATING SEGMENTS
The Company has a single reportable segment as a provider of
marketing services.
Geographical information:
In presenting information on the basis of geographical segments,
segment revenue is based on the geographical location of
consumers.
Six months ended
June 30 (unaudited)
-----------------------
2021 2020
------------ ---------
USD thousands
-----------------------
America 135,663 63,696
APAC 9,470 8,538
EMEA 7,255 2,062
------------ ---------
Total 152,388 74,296
============ =========
Three months ended
June 30 (unaudited)
-----------------------
2021 2020
----------- ----------
USD thousands
-----------------------
America 72,403 30,077
APAC 4,920 4,454
EMEA 4,056 1,154
----------- ----------
Total 81,379 35,685
=========== ==========
NOTE 9: SUBSEQUENT EVENTS
On July 15 ,2021, Nasdaq IPO underwriters exercised in full
their over-allotment option to purchase an additional 1,015,342
ADSs from the Company at the initial public offering price of
$19.00 per ADS, raising an additional $19.3 million in gross
proceeds to the Company before deducting underwriting discounts and
commissions.
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IR DKFBBDBKBQFD
(END) Dow Jones Newswires
August 19, 2021 02:00 ET (06:00 GMT)