Q1 2021 Comscore Inc Earnings Call

The decline as the year progresses and.

Additionally, as I mentioned earlier, we are making enhancements to this suite of products both from a speed and data perspective that should result, and new customers as well as the return of previous customers later this year.

We also received video view ability accreditation from the media rating pump zone also known as the MRC for integrated third party measurement on Facebook, and Instagram, which should benefit our digital product suite.

Turning to our first quarter financial results, we continued to be encouraged by many products that it experienced solid.

Year over year, while at the same time, reducing many operating expenses and the long term, we believe our investments and data inputs.

And the new commercial relationships that we have signed will generate increased adjusted EBITDA from our higher revenue and expanded margins.

Greg will cover the first quarter results in detail later in the call.

On the National TV front, we are excited about new opportunities presented by the addition of Comcast D identified set top box data.

We expanded the number of highly targeted and networks and our national service.

And these additions could prove valuable as we signed two new network deals this quarter.

This product advancement, along with others is given the confidence the Viacom CBS do use comscore asset currency because of our stability and detail on the viewer I believe this move will help influence more media companies to do the same.

As we help them grow their business.

Our efforts to expand our connected TV measurement footprint are starting to bear fruit.

Are squarely positioned to take advantage of the opportunity that the connected TV marketplace percentage.

We expect to expand and additional markets and the second quarter that should increase revenue on the back half of 2021.

CTV information or connected TV is fair and important but it is the combination of CTV information and integrated it with our full census media footprint that includes linear TV and digital over the top video on demand address.

<unk> and other media that contains the real power of undue plicate at reach and frequency for planning and for Bonnie. This is where comscore has and in a unique position because of our close close relationship with the Mvpds.

And and the digital place based advertising Association also known as the D. P. A a to measure out of home media, which is a natural extension of our impression based currencies.

And we are as a trusted source per superior audience and site across linear T. D. O T T desktop mobile cinema and now, bringing the same measurement precision to bear.

Outdoor and digital out of home at a time that America is starting to get out of their homes again.

We signed our first client Lightbox and we expect to sign more in the near future, which we believe will continue to contribute to wrap and new and the second half of 2021, and so we ramp up the services.

We have announced and recently signed and important partnership with dish media slang and.

Have signed another cornerstone agreement that we're announcing on this call and aggregator a credit and debit card transactions that we believe will begin to generate revenue during 2021 and will help our customers prove that they are advertising is working.

Ambition slang theme Green and includes the continued cross class corn and measurement of advanced advertising and content by Comscore television products.

The expanded data rates, including first party matching rights to improve accuracy of campaign results and national address ability measurement per programming networks.

Lastly, and movies, while the first quarter Shaw lower revenue, we expect to see a rebound shortly and now that uf's theaters are beginning to reopen its scale and with countries such as the U K, Ireland, and France expected will be reopened and the next couple of weeks we also.

And renewed agreements with the television advertising Bureau, cops reps cash TV, Katy Oc and Los Angeles, Quincy Media, Sagamore Hill Broadcasting and independence television.

In summary, we made strong progress and all areas of our business and the first quarter.

We now have the financial flexibility to invest and future growth products and are moving quickly to bring.

And to market.

Products that should increase our revenue and 2021.

Now I'd like to turn the call over to our Chief Financial Officer, Greg Greg.

Greg Please.

Thank you Bill today, we reported first quarter revenue of $90 3 million up from $89 5 million and the first quarter of last year.

The first quarter of 2021 marks the first quarterly year over year increase since the fourth quarter of 2018.

Revenue from ratings and planning and the first quarter was $65 8 million.

From $63 5 million reported and the first quarter of last year.

The increase compared to the same period and the prior year was the result of higher TV revenue and services related to our international Cross platform offering partially offset by syndicated digital.

TV continued to experience higher revenue compared to the prior year from new partnerships and from delivering TV data as part of an expanded relationship with an enterprise customer.

We also recorded $2 $4 million and revenue for certain cross platform services delivered in Europe related to the renewal other multi year agreement.

Syndicated digital revenue was lower compared to the prior year quarter, primarily from lower international business.

For the first quarter TV revenue comprised 46% of our ratings and planning revenue compared to 42% last year, while syndicated digital revenue comprised 45% of our ratings and planning compared to 50% and the first quarter of 2020.

Revenue from analytics and optimization and the first quarter was $17 7 million up from $15 5 million and the first quarter of last year.

The increase was due to higher custom solutions revenue compared to the first quarter of last year and increased activation revenue.

The first quarter of 2021 and benefited from delivery of projects, where customers delayed projects last year to 2021 due to the pandemic.

Movies reporting and analytics revenue and the first quarter was $6 8 million compared to $10 5 million and the prior year quarter.

Revenue continues to be impacted by theater closures and delayed releases as a result of the pandemic as customers continue to hold off restarting services globally until further certainty of content and theater openings is clear.

And as theater re openings began in earnest and major U S cities and March and are expected and Europe. Shortly we believe revenue from our movie business has bottomed and we will see revenue increase from this level starting in the second quarter.

Turning to operating costs, our core operating expenses, which includes cost of revenues sales and marketing R&D and G&A increased $4 $7 million year over year and the first quarter.

Cost of revenues increased by $6 9 million and the first quarter compared to the year ago quarter, due primarily to an increase of $3 million and data costs and $2 4 million related to the multi year Cross platform services contract I described earlier.

We do expect cost of revenues to continue to increase and 2021 from higher data costs as well as our additional data required to support our international expansion.

However, we expect margins to improve over the course of the year as revenue increases.

Selling and marketing expense declined $1 4 million as compared to the year ago quarter from lower travel and marketing costs, while R&D expense was flat.

G&A expense for the first quarter decreased $1 1 million compared to the prior year quarter from lower operating costs and many areas of our administrative functions.

We do expect our operating expenses to rise slightly from these levels as we invest and new product offerings that should lead to higher revenue later this year.

And the first quarter, we reported a net loss of $36 4 million compared to a net loss of $13 2 million and the same period last year.

The first quarter of 2021 includes a noncash charge of $15 3 million. We took upon closing of the transaction related to the extinguishment of debt and associated derivative issuance of conversion shares and.

And and adjustment to the series a warrant exercise price.

The first quarter of 2020 included a $4 7 million noncash impairment charge related to certain properties.

For the first quarter of 2021, adjusted EBITDA was $5 6 million compared to $6 4 million for the same period last year.

Adjusted EBITDA for the first quarter was impacted by higher data costs, but benefited from our generally lower operating costs as compared to the prior year.

We ended the first quarter with total cash of $33 9 million compared to $50 7 million at December 31, 2020.

The decrease in cash reflects the repayment of debt in the quarter as well as transaction cost associated with the completion of the recapitalization.

Yesterday, we entered into a $25 million revolving credit facility that will provide us additional liquidity and financial flexibility.

Looking forward, we continue to expect 2021 revenue will increase between three and 5% over 2020.

And that the increase will take hold beginning on the second half of 2021.

In addition, we expect adjusted EBITDA margin to be between six and 8% per year.

Now, let me turn it back to the operator to take questions.

And as a reminder to ask a question you will need to press star and the number one on your telephone keypad.

And Thats Star one.

And your first question comes from Dan Medina from Needham.

And Gregg and thanks for taking the question.

And just given where the first quarter came out and I was wondering if you can discuss how we might think of revenue growth cadence over the next three quarters and what will be the key growth drivers and each quarter. Thank you.

Thanks, Dan and I. Appreciate the question look we're really pleased where were first quarter came out.

And we're very optimistic about the back half of 2021 preliminary let me start there.

And while we haven't provided specifics regarding the 2021 quarters.

We are very focused on revenue growth and continue to believe it's going to be in the back half of 2021.

We have outlined in our guidance to achieve the 3% to 5%.

Bill outlined many different products and things that have occurred over the last.

Four months to start out 2021, and as those now are signed and in process, we expect those to generate revenue and the back half.

And I haven't given specifics around quarters, we do continue to believe that we will see improving quarters throughout all of 2021.

Great. Thank you.

And I would now like to turn the call back over key Bill <unk> for closing remarks.

Thank you operator.

We remain excited about the future and we'll continue to see the progress.

Advanced through 2021, we look forward to sharing with you the progress on our next quarterly call and with press releases and the interim and thank you for joining us today and trusting us with some of your investment dollars. Thank you and have a great evening.

Ladies and gentlemen, this concludes today's conference call. Thank you for participating you may now disconnect.

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