iClick Interactive Asia Group Limited Reports Fourth Quarter and Full Year 2018 Unaudited Financial Results
Three Months Ended December 31, | Year Ended December 31, | |||||||||||
2017 | 2018 | Percentage change |
2017 | 2018 | Percentage change |
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(US$ in thousands) |
||||||||||||
(Unaudited) |
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Financial Metrics: | ||||||||||||
Net revenues |
||||||||||||
Mobile audience solutions |
34,174 | 33,951 | (1%) | 101,426 | 140,428 | 38% | ||||||
Other solutions |
5,587 | 5,553 | (1%) | 23,832 | 19,589 | (18%) | ||||||
Total net revenues |
39,761 | 39,504 | (1%) | 125,258 | 160,017 | 28% | ||||||
Gross profit |
9,716 | 11,753 | 21% | 29,525 | 39,120 | 32% | ||||||
Adjusted EBITDA1 | (2,224) | (885) | N/M | (4,515) | 1,564 | N/M | ||||||
Adjusted net loss1 | (3,775) | (1,291) | N/M | (11,198) | (4,669) | N/M | ||||||
Diluted adjusted net loss per ADS1 | (0.24) | (0.02) | N/M | (0.59) | (0.09) | N/M | ||||||
Operating Metrics: | ||||||||||||
Gross billing | ||||||||||||
Mobile audience solutions | 67,756 | 79,139 | 17% | 172,194 | 328,702 | 91% | ||||||
Other solutions | 18,669 | 18,918 | 1% | 76,085 | 71,047 | (7%) | ||||||
Total gross billing | 86,425 | 98,057 | 13% | 248,279 | 399,749 | 61% | ||||||
1 For more details on these non-GAAP financial measures, please see the tables captioned “Unaudited Reconciliations of GAAP and Non-GAAP Results” set forth at the end of this press release. |
“2018 was a very productive year for iClick, as we continued to achieve record high results in various key financial and operating metrics, including gross billing, net revenues, gross profit, and adjusted EBITDA. We also reported historically low adjusted net loss for the year. Additionally, we strengthened our business through organic growth and acquisitions, and continued the transformation of our Company to a CRM & Marketing Cloud Platform,” said
“We believe our market-leading Chinese consumer dataset, experience in serving enterprise-level clients and strong data analytics capability, combined with plans to strengthen our online marketing position, build new revenue streams, increase cash flow and expand margins, will continue to drive solid growth for years to come,” Hsieh said.
Fourth Quarter 2018 Results:
Net revenues for the fourth quarter of 2018 were
Net revenues from mobile audience solutions were
Net revenues from other solutions remained relatively stable at
Gross profit for the fourth quarter of 2018 increased by 21% to
Total operating expenses were
Operating loss was
Net loss totalled
Net loss attributable to the Company’s shareholders per basic and diluted ADS was
Gross billing3 reached
Adjusted EBITDA for the fourth quarter of 2018 was a loss of
Adjusted net loss for the fourth quarter of 2018 was
As of
2For more details, please see note 4 under the “Unaudited Condensed Consolidated Statements of Comprehensive Loss”.
3Gross billing is defined as the aggregate dollar amount that clients pay the Company after deducting rebates paid and discounts given to clients.
Full Year 2018 Results:
Net revenues for 2018 were
Net revenues from mobile audience solutions increased by 38% to
Net revenues from other solutions were
Gross profit increased by 32% to
Total operating expenses were
Operating loss for 2018 was
Net loss totalled
Net loss attributable to the Company’s shareholders per basic and diluted ADS was
Gross billing grew to
Adjusted EBITDA for 2018 was
Adjusted net loss attributable to the Company’s shareholders was
Outlook
Based on the information available as of the date of this press release, iClick provided the following outlook for the full year 2019 and the first quarter of 2019:
Full Year 2019:
- Net revenues are estimated to be between
US$200 million and US$220 million for 2019. - Gross profit margin is estimated to be between 28% and 30%.
First Quarter 2019:
- Net revenues are estimated to be between
US$38 million and US$42 million . - Gross profit margin is estimated to be between 26% and 28%.
The above outlook is based on current market conditions and reflects the Company’s preliminary estimates of market and operating conditions, expected foreign exchange fluctuation, and customer demand, which are all subject to change. Please also refer to the factors set out under “Safe Harbor Statement”.
Conference Call
The Company will host an earnings conference call at
Dial-in details for the earnings conference call are as follows:
United States: | +1-845-675-0437 |
International: | +65-6713-5090 |
Hong Kong: | +852-3018-6771 |
China: | 400-620-8038 |
Conference ID: | 4978334 |
Participants should dial-in at least five minutes before the scheduled start time and ask to be connected to the call for “iClick Interactive.”
Additionally, a live and archived webcast of the conference call will be available on the Company's investor relations website at http://ir.i-click.com.
A replay of the conference call will be accessible by phone two hours after the conclusion of the live call at the following numbers until
United States: | +1-855-452-5696 |
International: | +61-2-8199-0299 |
Hong Kong: | 800-963-117 |
China: | 400-632-2162 |
Replay Access Code: | 4978334 |
About
Non-GAAP Financial Measures
The Company uses adjusted EBITDA, adjusted net loss, and diluted adjusted net loss per ADS, each a non-GAAP financial measure, in evaluating the Company’s operating results and for financial and operational decision making purposes.
The Company believes that adjusted EBITDA, adjusted net loss, and diluted adjusted net loss per ADS help identify underlying trends in the Company’s business that could otherwise be distorted by the effect of the expenses and gains that the Company includes in net loss. The Company believes that adjusted EBITDA and adjusted net loss provide useful information about the Company’s operating results, enhance the overall understanding of the Company’s past performance and future prospects and allow for greater visibility with respect to key metrics used by the Company’s management in its financial and operational decision-making.
Adjusted EBITDA, adjusted net loss, and diluted adjusted net loss per ADS should not be considered in isolation or construed as an alternative to net loss or any other measure of performance or as an indicator of the Company’s operating performance. Investors are encouraged to review the historical non-GAAP financial measures to the most directly comparable GAAP measures. Adjusted EBITDA, adjusted net loss, and diluted adjusted net loss per ADS presented here may not be comparable to similarly titled measures presented by other companies. Other companies may calculate similarly titled measures differently, limiting their usefulness as comparative measures to the Company’s data. The Company encourages investors and others to review the Company’s financial information in its entirety and not rely on a single financial measure.
For more information on these non-GAAP financial measures, please see the table captioned “Unaudited Reconciliations of GAAP and Non-GAAP results” set forth at the end of this press release.
Statement Regarding Unaudited Financial Information
The unaudited financial information set out in this press release is preliminary and subject to potential adjustments. Adjustments to the consolidated financial statements may be identified when audit work has been performed for the Company’s year-end audit, which could result in significant differences from this preliminary unaudited financial information.
Safe Harbor Statement
This announcement contains forward-looking statements. These statements constitute “forward-looking” statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," "confident" and similar statements. Such statements are based upon management’s current expectations and current market and operating conditions, and relate to events that involve known or unknown risks, uncertainties and other factors, all of which are difficult to predict and many of which are beyond the Company’s control. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the Company's fluctuations in growth; its success in implementing its mobile and new retail strategies; its success in structuring a CRM & Marketing Cloud platform; relative percentage of its gross billing recognized as net revenues under the gross and net models; its ability to retain existing clients or attract new ones; its ability to retain content distribution channels and negotiate favourable contractual terms; market competition, including from independent online marketing technology platforms as well as large and well-established internet companies; market acceptance of online marketing technology solutions; effectiveness of its algorithms and data engines; its ability to collect and use data from various sources; fluctuations in foreign exchange rates; and general economic conditions in
For investor and media inquiries, please contact:
In China: iClick Interactive Asia Group Limited Lisa Li Phone: +852-3700-9065 E-mail: ir@i-click.com |
In the United States: PondelWilkinson Inc. Evan Pondel/Laurie Berman Tel: +1-310-279-5980 E-mail: iclk@pondel.com |
(financial tables follow)
ICLICK INTERACTIVE ASIA GROUP LIMITED Unaudited Condensed Consolidated Statements of Comprehensive Loss (US$’000, except share data and per share data, or otherwise noted, unaudited) |
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Three Months Ended December 31, |
Year Ended December 31, |
|||||||
2017 | 2018 | 2017 | 2018 | |||||
Net revenues4 | 39,761 | 39,504 | 125,258 | 160,017 | ||||
Cost of revenues4 | (30,045 | ) | (27,751 | ) | (95,733 | ) | (120,897 | ) |
Gross profit | 9,716 | 11,753 | 29,525 | 39,120 | ||||
Operating expenses | ||||||||
Research and development expenses | (1,200 | ) | (2,451 | ) | (5,778 | ) | (10,737 | ) |
Sales and marketing expenses | (8,287 | ) | (12,747 | ) | (25,935 | ) | (32,080 | ) |
General and administrative expenses | (6,056 | ) | (7,101 | ) | (12,983 | ) | (23,757 | ) |
Total operating expenses | (15,543 | ) | (22,299 | ) | (44,696 | ) | (66,574 | ) |
Operating loss | (5,827 | ) | (10,546 | ) | (15,171 | ) | (27,454 | ) |
Interest expense | (130 | ) | (79 | ) | (551 | ) | (352 | ) |
Other gains, net | 405 | 925 | 1,841 | 687 | ||||
Fair value loss on derivative liabilities | (3,134 | ) | — | (10,190 | ) | — | ||
Fair value gain/(loss) on convertible notes | — | 546 | — | (4,837 | ) | |||
Loss before income tax expense | (8,686 | ) | (9,154 | ) | (24,071 | ) | (31,956 | ) |
Income tax (expenses)/benefit | (49 | ) | 1,015 | (548 | ) | (655 | ) | |
Net loss | (8,735 | ) | (8,139 | ) | (24,619 | ) | (32,611 | ) |
Net loss attributable to noncontrolling interests | — | 202 | — | 202 | ||||
Net loss attributable to iClick Interactive Asia Group Limited | (8,735 | ) | (7,937 | ) | (24,619 | ) | (32,409 | ) |
Accretion to convertible redeemable preferred shares redemption value | (1,057 | ) | — | (1,662 | ) | — | ||
Accretion to redeemable ordinary shares redemption value | (2,371 | ) | — | (3,650 | ) | — | ||
Net loss attributable to iClick Interactive Asia Group Limited’s ordinary shareholders | (12,163 | ) | (7,937 | ) | (29,931 | ) | (32,409 | ) |
Net loss | (8,735 | ) | (8,139 | ) | (24,619 | ) | (32,611 | ) |
Other comprehensive loss: | ||||||||
Foreign currency translation adjustment, net of US$nil tax | (10 | ) | 1 | (79 | ) | (2,547 | ) | |
Comprehensive loss | (8,745 | ) | (8,138 | ) | (24,698 | ) | (35,158 | ) |
Comprehensive loss attributable to noncontrolling interests | — | 202 | — | 202 | ||||
Comprehensive loss attributable to iClick Interactive Asia Group Limited | (8,745 | ) | (7,936 | ) | (24,698 | ) | (34,956 | ) |
Net loss per ADS attributable to iClick Interactive Asia Group Limited | ||||||||
— Basic | (0.41 | ) | (0.15 | ) | (1.07 | ) | (0.61 | ) |
— Diluted | (0.41 | ) | (0.15 | ) | (1.07 | ) | (0.61 | ) |
Weighted average number of ADS used in per share calculation: | ||||||||
— Basic | 29,699,102 | 54,556,147 | 27,863,006 | 52,904,817 | ||||
— Diluted | 29,699,102 | 54,556,147 | 27,863,006 | 52,904,817 | ||||
4On January 1, 2018, the Company adopted ASC 606 "Revenue from Contracts with Customers" using the modified retrospective method. The adoption did not have any impact to the accumulated deficit as of January 1, 2018. As a result of the adoption, certain rebates to marketers are presented net of revenues, as opposed to being included in cost of revenues in prior periods. | ||||||||
ICLICK INTERACTIVE ASIA GROUP LIMITED Unaudited Condensed Consolidated Balance Sheets (US$’000, except share data and per share data, or otherwise noted, unaudited) |
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As of December 31, | |||
2017 | 2018 | ||
Assets | |||
Current assets | |||
Cash and cash equivalents | 19,401 | 39,828 | |
Time deposit | 25,000 | - | |
Short-term investment | - | 17,427 | |
Accounts receivable, net of allowance for doubtful receivables of US$1,478 and US$1,507 as of December 31, 2017 and December 31, 2018, respectively | 40,798 | 65,627 | |
Rebates receivable | 1,334 | 4,067 | |
Prepaid media costs | 37,784 | 19,107 | |
Other current assets | 3,107 | 3,242 | |
Income tax receivable | 3 | - | |
Total current assets | 127,427 | 149,298 | |
Non-current assets | |||
Deferred tax assets | 850 | 1,153 | |
Property and equipment, net | 1,165 | 329 | |
Intangible assets, net | 10,600 | 7,247 | |
Goodwill | 48,496 | 48,496 | |
Long-term investment | - | 503 | |
Other assets | 284 | 232 | |
Total non-current assets | 61,395 | 57,960 | |
Total assets | 188,822 | 207,258 | |
Liabilities, mezzanine equity and shareholders’ equity | |||
Current liabilities | |||
Accounts payable (including accounts payable of the consolidated variable interest entity (“VIE”) and its subsidiaries without recourse to the Company of US$29 and US$45 as of December 31, 2017 and December 31, 2018, respectively) | 3,904 | 6,557 | |
Deferred revenue (including deferred revenue of the consolidated VIE and its subsidiaries without recourse to the Company of US$5,986 and US$1,300 as of December 31, 2017 and December 31, 2018, respectively) | 33,037 | 27,191 | |
Accrued liabilities and other current liabilities (including accrued liabilities and other current liabilities of the consolidated VIE and its subsidiaries without recourse to the Company of US$804 and US$1,776 as of December 31, 2017 and December 31, 2018, respectively) | 16,129 | 16,348 | |
Bank borrowings | 10,486 | 9,439 | |
Convertible notes at fair value | - | 34,837 | |
Income tax payable | 2,123 | 2,779 | |
Total current liabilities | 65,679 | 97,151 | |
Non-current liabilities | |||
Accrued liabilities and other non-current liabilities (including accrued liabilities and other non-current liabilities of the consolidated VIE and its subsidiaries without recourse to the Company of US$nil as of December 31, 2017 and December 31, 2018, respectively) | - | 673 | |
Deferred tax liabilities | 3,159 | 2,794 | |
Total non-current liabilities | 3,159 | 3,467 | |
Total liabilities | 68,838 | 100,618 |
As of December 31, 2017 |
As of December 31, 2018 |
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Equity | |||
Ordinary shares – Class A (US$0.001 par value; 80,000,000 shares authorized as of December 31, 2017 and December 31, 2018, respectively; 21,238,825 and 23,166,092 shares issued and outstanding as of December 31, 2017 and December 31, 2018, respectively) | 21 | 23 | |
Ordinary shares – Class B (US$0.001 par value; 20,000,000 shares authorized as of December 31, 2017 and December 31, 2018, respectively; 4,820,608 shares issued and outstanding as of December 31, 2017 and December 31, 2018, respectively) | 5 | 5 | |
Treasury shares (2,123,382 shares and 1,363,860 shares as of December 31, 2017 and December 31, 2018, respectively) | (2,093) | (576) | |
Additional paid-in capital | 274,294 | 293,072 | |
Statutory reserves | 81 | 81 | |
Accumulated other comprehensive losses | (3,320) | (5,867) | |
Accumulated deficit | (149,004) | (181,413) | |
Total shareholders’ equity | 119,984 | 105,325 | |
Noncontrolling interests | - | 1,315 | |
Total equity | 119,984 | 106,640 | |
Total liabilities and equity | 188,822 | 207,258 | |
ICLICK INTERACTIVE ASIA GROUP LIMITED
Unaudited Reconciliations of GAAP and Non-GAAP Results
Adjusted EBITDA represents net loss before (i) depreciation and amortization, (ii) interest expense, (iii) income tax expenses/(benefit), (iv) share-based compensation, (v) fair value loss on derivative liabilities, (vi) fair value (gain)/loss on convertible notes, (vii) other gains, net, (viii) convertible notes issuance cost, (ix) professional fees in relation to acquisitions, and (x) net loss attributable to noncontrolling interests.
The table below sets forth a reconciliation of the Company’s adjusted EBITDA to net loss for the periods indicated:
Three Months Ended December 31, |
Year Ended December 31, |
|||||||
2017 | 2018 | 2017 | 2018 | |||||
(Unaudited) | ||||||||
Net loss | (8,735 | ) | (8,139 | ) | (24,619 | ) | (32,611 | ) |
Add / (less): | ||||||||
Depreciation and amortization | 1,372 | 1,342 | 5,584 | 5,226 | ||||
Interest expense | 130 | 79 | 551 | 352 | ||||
Income tax expenses/(benefit) | 49 | (1,015 | ) | 548 | 655 | |||
EBITDA | (7,184 | ) | (7,733 | ) | (17,936 | ) | (26,378 | ) |
Add / (less): | ||||||||
Share-based compensation | 2,231 | 6,396 | 5,072 | 19,679 | ||||
Fair value loss on derivative liabilities | 3,134 | — | 10,190 | — | ||||
Fair value (gain)/loss on convertible notes | — | (546 | ) | — | 4,837 | |||
Other gains, net | (405 | ) | (925 | ) | (1,841 | ) | (687 | ) |
Convertible notes issuance cost5 | — | — | — | 2,190 | ||||
Professional fees in relation to acquisitions6 | — | 1,721 | — | 1,721 | ||||
Net loss attributable to noncontrolling interests | — | 202 | — | 202 | ||||
Adjusted EBITDA | (2,224 | ) | (885 | ) | (4,515 | ) | 1,564 |
Adjusted net loss represents net loss before (i) share-based compensation, (ii) fair value loss on derivative liabilities, (iii) fair value (gain)/loss on convertible notes, (iv) other gains, net, (v) convertible notes issuance cost, (vi) professional fees in relation to acquisitions, and (vii) net loss attributable to noncontrolling interests. There is no material tax effects on these non-GAAP adjustments.
5Convertible notes issuance cost represents one-off transaction cost for the issue of convertible notes, including success fee, legal and professional fee, and consulting fee.
6 It represents one-off transaction cost for acquisitions, including consulting fee, and legal and professional fee.
The table below sets forth a reconciliation of the Company’s adjusted net loss to net loss for the periods indicated:
Three Months Ended December 31, |
Year Ended December 31, |
|||||||||||
2017 | 2018 | 2017 | 2018 | |||||||||
(Unaudited) | ||||||||||||
Net loss | (8,735 | ) | (8,139 | ) | (24,619 | ) | (32,611 | ) | ||||
Add / (less): | ||||||||||||
Share-based compensation | 2,231 | 6,396 | 5,072 | 19,679 | ||||||||
Fair value loss on derivative liabilities | 3,134 | — | 10,190 | — | ||||||||
Fair value (gain)/loss on convertible notes | — | (546 | ) | — | 4,837 | |||||||
Other gains, net | (405 | ) | (925 | ) | (1,841 | ) | (687 | ) | ||||
Convertible notes issuance cost | — | — | — | 2,190 | ||||||||
Professional fees in relation to acquisitions | — | 1,721 | — | 1,721 | ||||||||
Net loss attributable to noncontrolling interests | — | 202 | — | 202 | ||||||||
Adjusted net loss | (3,775 | ) | (1,291 | ) | (11,198 | ) | (4,669 | ) |
The basic and diluted adjusted net loss per ADS for the periods indicated are calculated as follows:
Three Months Ended December 31, |
Year Ended December 31, |
||||||||||
2017 | 2018 | 2017 | 2018 | ||||||||
(Unaudited) | |||||||||||
Numerator: | |||||||||||
Adjusted net loss | (3,775 | ) | (1,291 | ) | (11,198 | ) | (4,669 | ) | |||
Accretion to convertible redeemable preferred shares redemption value | (1,057 | ) | — | (1,662 | ) | — | |||||
Accretion to redeemable ordinary shares redemption value | (2,371 | ) | — | (3,650 | ) | — | |||||
(7,203 | ) | (1,291 | ) | (16,510 | ) | (4,669 | ) | ||||
Denominator: | |||||||||||
Denominator for basic and diluted net loss per ADS | |||||||||||
- weighted average ADS outstanding | 29,699,102 | 54,556,147 | 27,863,006 | 52,904,817 | |||||||
Basic adjusted net loss per ADS | (0.24 | ) | (0.02 | ) | (0.59 | ) | (0.09 | ) | |||
Diluted adjusted net loss per ADS | (0.24 | ) | (0.02 | ) | (0.59 | ) | (0.09 | ) |
Source: iClick Interactive Asia Group Limited