Attached files
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| 8-K - interCLICK, Inc. | v171228_8k.htm |
| EX-99.2 - interCLICK, Inc. | v171228_ex99-2.htm |
interCLICK,
Inc.
Prepared
Remarks – ICR Conference 1/13/10
SLIDE 2:
Good
afternoon, thanks for your time today. Here’s an important disclaimer for your
review.
Certain
statements in this presentation and responses to various questions may contain
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995 including our fourth quarter 2009 revenue and
EBITDA, our 2010 revenue guidance, gross profit, continuing growth, integrating
additional partners and our ability to maximize ROI. Forward-looking
statements can be identified by words such as “anticipates,” “intends,” “plans,”
“seeks,” “believes,” “estimates,” “expects” and similar references to future
periods.
Forward-looking
statements are based on our current expectations and assumptions regarding our
business, the economy and other future conditions. Because
forward-looking statements relate to the future, they are subject to inherent
uncertainties, risks and changes in circumstances that are difficult to
predict. Our actual results may differ materially from those
contemplated by the forward-looking statements. We caution you
therefore against relying on any of these forward-looking
statements. They are neither statements of historical fact nor
guarantees or assurances of future performance. Important factors
that could cause actual results to differ materially from those in the
forward-looking statements include the impact of intense competition, the
continuation or worsening of current economic conditions, a potential decrease
in corporate advertising spending, a potential decrease in consumer spending and
the condition of the domestic and global credit and capital
markets.
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Further
information on interCLICK’s risk factors is contained in its filings with the
SEC, including the Prospectus Supplement dated December 15, 2009. Any
forward-looking statement made by interCLICK in this presentation speaks only as
of the date on which it is made. Factors or events that could cause
our actual results to differ may emerge from time to time, and it is not
possible for us to predict all of them. We undertake no obligation to
publicly update any forward-looking statement, whether as a result of new
information, future developments or otherwise.
This
presentation includes disclosure of EBITDA, a non-GAAP financial measure.
interCLICK relies on certain non-GAAP financial measures as defined under SEC
Regulation G in assessing performance and when planning, forecasting and
analyzing future periods. interCLICK believes that non-GAAP financial
measures are useful to investors because they allow for greater transparency
with respect to key metrics used by management. A reconciliation of EBITDA to
the most directly comparable GAAP measure is available at the end of this
presentation.
SLIDE 3:
Starting
with an overview of interCLICK:
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We up-listed to Nasdaq on
November 5th last
year.
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We currently have 4 Sales
Offices with over 20 sales managers based in those
offices.
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Our Basic Share Count is 23.6
million shares, and our fully diluted share count is approx. 30 million
shares.
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interCLICK has a reach of
approximately 143 million unique users per COMSCORE, and serves over 3
billion impressions/ month across about 750
publishers.
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interCLICK
is the leading ad network in data and inventory transparency....we offer a
unique strategy in the behavioral targeting market – as our transparent platform
leverages the rich ecosystem of 3rd party data providers in order to provide
unprecedented ROI and scale to advertisers. More on our strategy in a few
minutes.
SLIDE 4:
Here’s
a quarterly snapshot of our financials over the past two years. Note that from
Q1’08 to Q3’09, our quarterly revenues have grown by approximately
300%.
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Our
previous guidance was to deliver revenues in Q4 over $18 million, and for the
full-year 2009, over $51 million. We delivered $2.5 million of EBITDA in the
first three quarters of 2009, and previously guided EBITDA in Q4 of at least
$1.5 million.
Our
preliminary 2010 guidance was to deliver revenues exceeding $80 million, and
EBITDA of $9 million. Any updates to 2010 guidance will happen when we report
2009 results in late February.
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SLIDE 5:
In
terms of a business update, the market conditions leading up to and including
the holidays were the best we’ve seen. We’ll report our numbers in several
weeks, but we’re confident that we’ll exceed our $18 million revenue guidance by
at least $3 million – to over $21 million, highlighted by an exceptional
December.
We
continue to benefit from a couple of significant market trends. Non-premium
display has been, and will continue to be, the largest growth area for all of
online advertising, including search. This flight to value is being led by
companies delivering innovative technology and process based solutions.
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Throughout
2009, interCLICK invested significantly in our infrastructure highlighted by
several large scale platform upgrades as well as several key personnel hires at
the executive and middle management levels that have had a meaningful impact on
our business, allowing us to scale our business and improve operating
efficiencies. Second, as the third party data market continues to mature we will
continue to stay at the forefront of innovative targeting
solutions.
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Demand
tends to be strongest in the fourth quarter due to seasonality and
end-of-the-year revenue pushes by the agencies. In order to fill the demand, our
cost of goods sold rose on an absolute and percentage basis to some of the
highest levels we saw all year.
While
this affected our overall gross margin percentage, the much higher
demand for our services led to total gross profit dollars that we estimate will
exceed our initial expectations.
We
believe that the tremendous revenue growth we enjoyed, along with macro trends
such as increases
in third-party data costs, re-affirms not
only our leadership position in the marketplace but also our approach to
delivering value to our clients.
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Our
ability to execute successfully on the operational front – especially as we
continue to grow campaigns over time – cannot be understated.
For
example, the platform upgrade we completed back in July allowed us to experience
tremendous operational efficiency even as we saw demand spike to new highs.
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SLIDE 6:
This
graphic depicts the evolving ad network model. Ad networks are now supply chain
management companies aligning Demand (Advertisers) with proper Supply (Inventory
sources include Publishers, Portals, and Exchanges, and Data
Suppliers).
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Equilibrium
is achieved when supply and demand are properly aligned.
interCLICK’s
long-term focus is to optimize for supply-chain success by executing in three
critical areas: Hiring Great People, Developing World-Class, Repeatable
Operating Processes and Technology Innovation.
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SLIDE 7:
Our
unique technology platform was architected to allow integration across an array
of 3rd party data providers.
We
have 4 partners that we’ve directly integrated with to date, and 4 additional
data providers that we obtain data from through data exchanges. And we expect to
continue integrating additional partners and different types of data in the near
term.
It’s
important to note that there’s no silver bullet when it comes to utilizing
3rd
party data (or inventory for that matter).
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The
key is to understand what data lifts what inventory for a given advertiser
campaign.
SLIDE 8:
This
schematic outlines our unique strategy and technology platform. Our platform
uniquely combines multiple data sources for an advertiser and evaluates them for
a given ad campaign to determine the inherent value of each data source –
allowing us to maximize ROI and build desired audiences at unprecedented
scale.
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Our
market share gains are a result of interCLICK delivering market-leading ROI and
volume to advertisers….which is translating to budget increases from our
existing advertisers. 2/3 of our revenues in Q2 were from existing
advertisers.
In
Q3, that percentage grew to over ¾ of our revenues from existing
advertisers.
SLIDE 9:
I’ll
complete my presentation today by providing a snapshot of key operating and
financial metrics for interCLICK, which you can see have grown dramatically over
the past two years.
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For
example, the middle (blue) line shows quarterly revenue, which grew 128% from
$4.7 million back in Q2 2008 – just prior to when we began integrating 3rd party
data – to $10.6 million one year later, in Q2 2009. And given our Q4 revenue
update I just provided, our growth has accelerated further, as we expect to
double again over these past two quarters; from $10.6 million in Q2 to over $21
million in Q4.
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Our
Gross Profit trajectory (shown here on the bottom green line) has exceeded that
of our revenue trajectory. Using the same example in Q2 2008 our Gross Profit
was $1.3 million dollars. One year later, in Q2 2009, our Gross Profit was $5
million – which was a 285% improvement year-over-year.
This
third curve (the top red line) shows the total impressions by quarter the
company has served over the past year (see the right axis in millions). Note
that while our revenues grew by 128% from Q2 to Q2, the number of quarterly
impressions served remained virtually flat year-over-year. In Q2 08, we served
8.26 billion impressions, and in Q2 09, we served the 8.38 billion impressions,
a year-over-year increase of only 1%.
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That
should now give you a clear indication as to why our gross profits have grown so
rapidly. We clearly have become more efficient in the management of our supply
chain and effective at delivering to advertisers market-leading returns on their
ad spend.
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SLIDE
10:
This
next slide plots our noteworthy technology releases against the revenue and
gross profit lines. I’ve already mentioned the 3rd Party
Data Integration in Q3 last year which was a strategic game-changer for
us.
Also
around that time we launched an internal Supply Chain Toolset which allows us to
measure the profitability of every single impression we serve. And currently
we’re in alpha stage of our new OSM platform which you’ll hear more about in the
coming months.
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SLIDE 11: GAAP
Slide
Here’s
a reconciliation between GAAP and non-GAAP measures.
SLIDE 12: Questions and
Answers
Thank
you for your time today, I’m happy to take your questions at this
time.
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