AcuityAds Reports Fourth Quarter and Fiscal Year 2019 Financial Results

- Generated $38.5 million in Revenue, $6.0 million in Adjusted EBITDA and $2.0 million in Net Income for the Fourth Quarter 2019
- 2019 Annual Revenue grew 70% to $119.1 million with Adjusted EBITDA of $9.7 million

TORONTO and NEW YORK, March 3, 2020 /CNW/ - AcuityAds Holdings Inc. (TSX:AT) (OTCQX:ACUIF) ("AcuityAds" or "Company"), a technology leader that provides targeted digital media solutions enabling advertisers to connect intelligently with audiences across all digital advertising campaigns, today announced its financial results for the three and twelve months ended December 31, 2019.

"We are incredibly pleased with our results for the fourth quarter of 2019 as we achieved record revenue, Adjusted EBITDA and net income. The Company performed above our expectations as we continued to see strong momentum in our business as well as higher gross margins attributable to our enhanced AI platform and lower costs resulting from tighter expense controls," said Tal Hayek, Chief Executive Officer of AcuityAds. "2019 was also a record year for Acuity. We delivered $119 million in revenue and close to $10 million in Adjusted EBITDA while also investing significant resources into our AI technology, expanding our inventory supply pipes and developing a new self-serve advertising automation system."

Mr. Hayek continued, "We are very excited with the momentum we are already seeing in 2020 as we continue to see the positive results from the enhancements to our AI technology that have continued to improve our gross margin and generate even better ROI for our clients. In addition, we have recently signed several clients to the beta testing of our new self-serve advertising automation platform. We expect the full launch of this platform in the summer of 2020 will further propel AcuityAds' growth, profitability and leadership position in the industry."

Fourth Quarter and Fiscal Year 2019 Highlights

• Total revenue for the three months ended December 31, 2019 was $38.5 million compared to $32.9 million for the same period in 2018, an increase of 17%. Total revenue for the twelve months ended December 31, 2019 was $119.1 million compared to $70.2 million for the same period in 2018, an increase of 70%.
• Total Self-Serve revenue for the three months ended December 31, 2019 increased 113% to $11.1 million, compared to $5.2 million for the same period in 2018. Total Self-Serve revenue for the twelve months ended December 31, 2019 increased 97% to $31.1 million compared to $15.8 million for the same period in 2018.
• Total Connected TV revenue grew approximately 169% sequentially from Q3 2019. Compared to Q1 2019, Connected TV revenue grew approximately 15 times.
• Revenue less media costs margin was 51% for the three months ended December 31, 2019 compared to 50% for the same period in 2018. Revenue less media costs margin was 48% for the twelve months ended December 31, 2019 compared to 52% for the same period in 2018.
• Adjusted EBITDA was $6.0 million for the three months ended December 31, 2019 compared to an Adjusted EBITDA of $3.3 million for the same period in 2018. Adjusted EBITDA for the twelve months ended December 31, 2019 was $9.7 million compared to an Adjusted EBITDA of $2.8 million for the same period in 2018.
• Net income for the three months ended December 31, 2019 was $2.0 million or $0.04 per share compared to a net loss of $3.9 million for the same period in 2018. Net loss for the twelve months ended December 31, 2019 was $5.2 million compared to a Net Loss of $10.8 million for the same period in 2018. The three months ended December 31, 2019 includes a $3.1 million gain related to the reversal of the earn-out and a $3.2 million charge related to a partial write-down of goodwill related to the 2018 acquisition of Adman.
• Adjusted Net Income was $5.2 million or $0.11 per share for the three months ended December 31, 2019 compared to Adjusted Net Income of $2.5 million or $0.06 per share for the same period in 2018. Adjusted Net Income for the twelve months ended December 31, 2019 was $4.8 million or $0.11 per share compared to an Adjusted Net Loss of $0.8 million for the same period in 2018. Adjusted Net Income (Loss) excludes non-cash items such as depreciation, amortization, impairment loss, fair value gain, foreign exchange gain/loss and share-based compensation (see table below).
• As at December 31, 2019 the Company's cash and restricted cash balance was $7.5 million.

The following table presents a reconciliation of net income (loss) to Adjusted EBITDA for the periods ended:

The following table presents a reconciliation of net income (loss) to Adjusted Net Income (Loss) for the periods ended:

Conference Call Details:

Date: Tuesday, March 3rd, 2020
Time: 9:00 AM Eastern Time

Participant Dial-in Numbers:
Local – (+1) 416 764 8609
Toll Free – (+1) 888 390 0605
Conference ID: 82324824

Recording Playback Numbers:
Local – (+1) 416 764 8677
Toll Free – (+1) 888 390 0541
Passcode: 324824 #
Expiry Date: Tuesday, March 10th, 2020 at 11:59pm

Non-IFRS Measures
This press release makes reference to certain non-IFRS measures. These measures are not recognized measures under IFRS, do not have a standardized meaning prescribed by IFRS, and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of our results of operations from management's perspective. Accordingly, these measures should not be considered in isolation nor as a substitute for analysis of our financial information reported under IFRS. We use non-IFRS measures including "revenue less media costs margin", "Adjusted EBITDA" and "Adjusted Net Income (Loss)" (as well as other measures discussed elsewhere in this press release).

The term "revenue less media costs margin" refers to the amount that "revenue less media costs" represents as a percentage of total revenue for a given period, while the term "revenue less media costs" refers to the net amount of revenue after deducting direct media costs. Revenue less media costs is used for internal management purposes as an indicator of the performance of the Company's solution in balancing the goals of delivering excellent results to advertisers while meeting the Company's margin objectives and, accordingly the Company believes it is useful supplemental information to include in this press release and in its MD&A.

"Adjusted EBITDA" refers to net income (loss) after adjusting for finance costs, impairment loss, fair value gain, income taxes, foreign exchange gain (loss), depreciation and amortization, share-based compensation, acquisition and related integration costs, severance expenses and adjustments to the carrying value of investment tax credits receivable. The Company believes that Adjusted EBITDA is useful supplemental information as it provides an indication of the results generated by the Company's main business activities before taking into consideration how those activities are financed and taxed and also prior to taking into consideration depreciation of property and equipment and certain other items listed above. It is a key measure used by the Company's management and board of directors to understand and evaluate the Company's operating performance, to prepare annual budgets and to help develop operating plans.

"Adjusted Net Income (Loss)" refers to net income (loss) after adjusting for non-cash items such as impairment loss, fair value gain, depreciation and amortization, share-based compensation and foreign exchange gain/loss. The Company believes that Adjusted Net Income (Loss) is useful supplemental information as it provides an indication of the results generated by the Company's main business activities on a cash basis. It is another key measure used by the Company's management and board of directors to understand and evaluate the Company's operating performance, to prepare annual budgets and to help develop operating plans.

These non-IFRS measures are used to provide investors with supplemental measures of our operating performance and thus highlight trends in our business that may not otherwise be apparent when relying solely on IFRS measures. We believe that securities analysts, investors and other interested parties frequently use non-IFRS measures in the evaluation of issuers, and that these non-IFRS measures in particular are relevant to their analysis of the Company.

About AcuityAds:
AcuityAds is a leading technology company that provides marketers a powerful and holistic solution for digital advertising across all ad formats and screens to amplify reach and Share of Attention® throughout the customer journey. Via its unique, data-driven insights, real-time analytics and industry-leading activation platform based on proprietary Artificial Intelligence technology, AcuityAds leverages an integrated ecosystem of partners for data, inventory, brand safety and fraud prevention, offering unparalleled, trusted solutions that the most demanding marketers require to be successful in the digital era.

AcuityAds is headquartered in Toronto with offices throughout the U.S., Europe and Latin America. For more information, visit AcuityAds.com.

Disclaimer in Regards to Forward-Looking Statements
Certain statements included herein constitute "forward-looking statements" within the meaning of applicable securities laws. These statements may relate to the Company's future financial outlook and anticipated events or results and include, but are not limited to, the expansion of its industry, its 2020 outlook, expectations regarding the full launch of the Company's new Self-Serve Programmatic Marketing Platform and the effect it will have on its growth, profitability and leadership position in the industry. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management at this time, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Investors are cautioned not to put undue reliance on forward-looking statements. Many factors could cause the Company's actual results, level of activity, performance or achievements or future events or developments to differ materially from those expressed or implied by the forward-looking statements, including, without limitation, the factors discussed in the "Risk Factors" section of the Company's management discussion and analysis dated March 2, 2020 for the fiscal year ended December 31, 2019 (the "MD&A"). A copy of the MD&A and the Company's other publicly filed documents can be accessed under the Company's profile on the System for Electronic Document Analysis and Retrieval ("SEDAR") at www.sedar.com. The Company cautions that the list of risk factors and uncertainties described in the MD&A is not exhaustive and other factors could also adversely affect its results. Readers are urged to consider the risks, uncertainties and assumptions carefully in evaluating the forward-looking information and are cautioned not to place undue reliance on such information.

Except as required by law, AcuityAds does not intend, and undertakes no obligation, to update any forward-looking statements to reflect, in particular, new information or future events.

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SOURCE AcuityAds Holdings Inc.

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