Bullboard - Stock Discussion Forum illumin Holdings Inc T.ILLM

Alternate Symbol(s): ILLMF

illumin Holdings Inc. provides a journey advertising platform, which enables marketers to reach consumers at every stage of their journey by leveraging advanced machine learning algorithms and real-time data analytics. It enables advertisers to connect intelligently with audiences across online display, video, social and mobile campaigns. Its Programmatic Marketing Platform, powered by machine... see more

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TSX:ILLM - Post Discussion

illumin Holdings Inc > RBC

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Post by retiredcf on May 11, 2023 9:57am

RBC

May 11, 2023

AcuityAds Holdings Inc
Q1/23 Results - A Good Start to the Year in a Tough Operating Environment

TSX: ILLM | CAD 1.94 | Sector Perform | Price Target CAD 3.50

Sentiment: Positive

Our view

Q1/23 revenue growth was higher than forecast, which we view as an incremental positive given the tough operating environment. We view Q1/23 results as an incremental positive for the shares at current levels.

First impression

• Q1/23 results largely in-line with slightly stronger revenue growth. Revenues and adjusted EBITDA were $26.5MM (+11.2% YoY) and -$1.3MM versus our estimates of $25.8MM and -$0.3MM (consensus is $25.5MM and -$0.4MM). Excluding media costs, net revenue of $12.5MM was in line with our estimate of $12.5MM and consensus of $12.5MM. The modest negative adjusted EBITDA variance was mainly due to continued strategic investments in R&D and sales and marketing to drive greater illumin penetration. Please see Exhibit 1 for a summary of Q1/23 results versus expectations.

• illumin traction continues in a seasonally softer quarter. illumin revenues were $16.7MM in Q1/23, representing 63% of total revenue and up +113% YoY versus $7.9MM in Q1/22. While illumin self-serve revenue decreased -8.3% sequentially to $2.2MM due to seasonality, the company added 40 new illumin clients in the quarter. Management also indicated early traction in signing multi-year contracts for illumin, which is expected to add to revenue visibility over time.

• Other notables. (i) while management continues to monitor the macro environment, the company will continue to invest in illumin and expects "significant improvement" in revenues and EBITDA in Q2/23; (ii) no shares were repurchased in Q1/23; and (iii) the company had cash of $80.2MM as of Q1/23.

• Issues in focus for the 8:30am ET call. (i) the impact of macro headwinds on advertising spend within Managed Services and any changes to the operating environment; and (ii) more granularity around expected traction with signing multi-year contracts for illumin.

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