- On track to report over 15% year-over-year annual growth despite conclusion of a significant global agreement with a large ad network client -
TORONTO, ON / ACCESSWIRE / November 30, 2020 / Adcore Inc. (the "Company" or "Adcore") (TSXV:ADCO)(FSE:ADQ), a leading provider of machine-learning ("ML" and "AI") powered advertising technologies used by digital agencies and advertisers to leverage digital marketing in an effortless and accessible way ("Effortless Advertising"), announced today that despite the conclusion of a significant global agreement with a large ad network client during the fourth quarter ended December 31, 2020, it is on track to report an increase in 2020 revenue of greater than 15% compared to 2019. The Company has been experiencing strong growth in its direct clients' activity during the fourth quarter of 2020 and believes this trend will continue into 2021.
The Company has outlined the following significant factors that have led to this revenue outlook for fiscal 2020.
Major ad network client of the Company concludes agreement:
A major ad network client referred to as "Client A" in the Company's financial statements has informed the Company that it has revised its worldwide partnership strategy, a decision which led to the ending of various agreements with multiple partners, including Adcore.
While the global agreement was concluded, the Company has retained an agreement with the ad network client in a key territory, which has been experiencing significant growth over the past year.
The Company is actively working on renewing the global agreement with the ad network client under revised terms during Q1 2021.
All the Company's indirect clients from the global agreement will remain Adcore's clients and continue to use the Company's technologies. The Company believes it will be able to further leverage and monetize this valuable customer base going forward.
The expected impact of the ad network client not renewing the agreement with the Company will result in an adjustment in revenue of approximately $1.5M over Q4 2020. The Company expects that the impact to net revenue will be considerably mitigated by:
The rebound the Company experienced in Q3 2020 is gaining even more momentum in Q4 2020, positioning the Company for record fourth quarter revenue, with direct clients' e-commerce activities up dramatically this holiday season.
The Company is encouraged by the traction coming from the Hong Kong and Australia offices and is optimistic that it will gain market share and drive significant growth in these regions during Q4 2020 and full year 2021.
The Company holds additional regional and global agreements with other ad network clients similar to the agreement that was concluded, which have already driven additional value.
Adcore has a strong balance sheet and high liquidity, with net working capital of $7 million as of September 30, 2020, providing financial flexibility to invest in organic and non-organic growth.
The Company is seeing signs of recovery in the tourism and leisure sector during Q4 2020, which will provide additional support to its growing e-commerce activity.
New initiatives the Company took as a reaction to the COVID-19 pandemic and the rise of the stay-at-home economy are starting to bear fruit.
Omri Brill, Chief Executive Officer, commented on the news, "Over the last decade, Adcore has grown at a CAGR of 39% by being customer focused and solving a dire need in the market place. In spite of a particularly challenging 2020 with the pandemic and lost high margin revenue from the conclusion of the global agreement, we are on track to report a strong fiscal year with a particularly strong Q4."
Mr. Brill continued, "The conclusion of the global agreement may very well prove to be a pivotal point in our evolution as a company, accelerating our drive to diversify the revenue base across multiple high growth markets. Adcore has always been an agile company, evidenced just recently by the fast adjustments we made at the outset of the pandemic and the quick rebound in our revenues from Q2 to Q3 2020. The Company has already started to reallocate resources previously dedicated to the global agreement and aggressively refocus on our core value offering. Under the revised strategy, we are already on our way to building a more durable, predictable and valuable business into 2021."
With the fourth quarter of fiscal 2020 not yet concluded, the Company has not yet completed its financial close processes for this quarter, and therefore full GAAP and non-GAAP financial results have not yet been finalized and until the Company reports its full financial results for fiscal 2020, the preliminary revenue results described in this press release are estimates only and are subject to revisions that could differ materially.
Conference Call and Webcast Information
Management will host an investor conference call and audio webcast at 8:30 a.m. EST on December 1, 2020. The conference call will include a Q&A session, questions can be sent in advance to email@example.com.
To access the live conference call:
Meeting ID: 827 4045 2390
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Adcore is a leading provider of machine-learning powered advertising technologies used by digital agencies and advertisers to leverage digital marketing in an effortless and accessible way ("Effortless Advertising") with the goal of scaling activity and maximizing ROI.
By combining extensive industry knowledge and experience with its proprietary artificial intelligence engine, Adcore offers a unique digital marketing solution. In addition to being named numerous times on Deloitte's Fast 50 Technology list, Adcore is a certified Google Premier Partner, Microsoft Partner, Facebook Partner and TikTok Partner.
Established in 2006, the Company employs over forty people in its headquarters in Tel Aviv, Israel and satellite offices in Melbourne, Australia, Toronto, Canada and Hong Kong, Greater China.
For more information about Adcore, please visit https://www.adcore.com/investors/
This press release contains certain forward-looking statements, including statements about the Company. Wherever possible, words such as "may", "will", "should", "could", "expect", "plan", "intend", "anticipate", "believe", "estimate", "predict" or "potential" or the negative or other variations of these words, or similar words or phrases, have been used to identify these forward-looking statements. These statements reflect management's current beliefs and are based on information currently available to management as at the date hereof.
Forward-looking statements involve significant risk, uncertainties and assumptions. Many factors could cause actual results, performance or achievements to differ materially from the results discussed or implied in the forward-looking statements. These factors should be considered carefully and readers should not place undue reliance on the forward-looking statements. Although the forward-looking statements contained in this press release are based upon what management believes to be reasonable assumptions, the Company cannot assure readers that actual results will be consistent with these forward-looking statements. These forward-looking statements are made as of the date of this press release, and the Company assumes no obligation to update or revise them to reflect new events or circumstances, except as required by law.
For further information please contact:
Omri Brill, CEO
Martijn van den Bemd, GM North America
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or the accuracy of this release.
SOURCE: Adcore Inc.
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