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Press release content from Business Wire. The AP news staff was not involved in its creation.
PRESS RELEASE: Paid content from Business Wire
Press release content from Business Wire. The AP news staff was not involved in its creation.

DoubleVerify Announces Third Quarter 2021 Financial Results

November 9, 2021 GMT

NEW YORK--(BUSINESS WIRE)--Nov 9, 2021--

DoubleVerify (“DV”) (NYSE: DV), a leading software platform for digital media measurement, data and analytics, today announced financial results for the third quarter ended September 30, 2021.

“We are pleased to have delivered another quarter of strong revenue and EBITDA growth and excited to highlight two strategic acquisitions that significantly expand our product leadership in CTV and Social and grow our global footprint,” said Mark Zagorski, CEO of DoubleVerify. “Our third quarter performance demonstrates continued organic growth and reflects the ongoing value that our products create for advertisers across all digital media platforms. Our pending acquisition of OpenSlate extends our core value proposition by combining its proven pre-campaign contextual targeting solutions with DV’s granular post-campaign measurement, offering end-to-end brand safety, suitability and contextual solutions across social video and CTV environments. The recently completed acquisition of Meetrics expands our business opportunities in EMEA. We expect both of these strategic investments to fuel our long-term growth trajectory and drive better business outcomes for DV customers by expanding our ability to drive media quality and performance everywhere.”

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Third Quarter 2021 Financial Highlights:
(All comparisons are to the third quarter of 2020)

  • Total revenue of $83.1 million, an increase of 36%.
  • Advertiser Programmatic revenue of $41.9 million, an increase of 49%.
  • Advertiser Direct revenue of $34.1 million, an increase of 23%.
    • Media Transactions Measured (“MTM”) for Social increased by 83% and for CTV increased by 41%.
    • APAC revenue increased by 96%.
    • EMEA revenue increased by 44%.
  • Supply-Side revenue of $7.1 million, an increase of 32%.
  • Net income of $7.9 million, an increase of 37%.
  • Adjusted EBITDA of $26.4 million, an increase of 82%, representing a 32% EBITDA margin.

Third Quarter and Recent Business Highlights:

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  • Grew premium-priced Authentic Brand Suitability (ABS) revenues by approximately 64% year-over-year in the third quarter driven by increased adoption on Google’s DV360 and The Trade Desk. Subsequent to quarter-end, ABS was launched on Tremor International, a leader in video and CTV advertising.
  • Drove global market share growth through new product upsells and logo wins including Facebook, Sony Japan, Disney Studios, TJX (TJ Maxx, Marshalls), American Family Insurance, Dropbox, Afterpay ANZ, Peloton Global, Burberry, Patek Philippe, John Lewis and HRA Pharma.
  • Partnered with TikTok to measure ad viewability, fraud and in-geo impressions. Via the solutions DoubleVerify expects to gain upon completing the OpenSlate acquisition, the company will be the only provider of unified brand suitability targeting, viewability and verification coverage across TikTok.
  • Expanded partnership with Innovid, an independent CTV advertising and measurement platform, to support the automation of DoubleVerify’s DV Video OmniTag, maximizing operational efficiency for advertisers.
  • Uncovered and neutralized Smokescreen, a fraud scheme that hijacked CTV devices to generate fraudulent ad impressions, protecting DV customers from wasting millions of dollars of investment each month.
  • Launched new version of DV Pinnacle™, the company’s unified analytics and reporting platform, offering global brands transparency into programmatic supply chain quality.

Strategic Initiatives:

  • Acquired Meetrics GmbH, a leading European ad verification company, on August 31, 2021 for an aggregate net cash purchase price of $24.3 million.
  • Recently launched Custom Contextual targeting for DV Publisher Suite enabling premium digital publishers to effectively monetize inventory in the post-cookie era.
  • Announced today an agreement to acquire OpenSlate, the leading independent pre-activation and content classification platform for social video and CTV in a cash and stock transaction valued at $150 million.

“In the third quarter, we continued to deliver strong momentum with year-over-year revenue growth of 36% and adjusted EBITDA margin of 32%, driven by continued international expansion, and product successes in fast-growth sectors such as Programmatic, Social and CTV,” said Nicola Allais, CFO of DoubleVerify. “In addition to delivering high growth and high profitability, we took advantage of our debt-free balance sheet and significant cash position to acquire Meetrics and support the pending acquisition of OpenSlate. We expect these strategic investments to fortify our long-term growth profile and allow us to capture a greater share of a large and growing addressable market. While our fourth quarter outlook reflects prudence due to supply chain issues that some of our customers currently face, we are reiterating our full-year 2021 guidance ranges and expect to deliver 34% full year revenue growth and a 32% EBITDA margin at the midpoints.”

Fourth Quarter and Full-Year 2021 Guidance:

DoubleVerify anticipates Revenue and Adjusted EBITDA to be in the following ranges:

Fourth quarter 2021:

  • Revenue of $98 to $103 million, a year-over-year increase of approximately 28% at the midpoint.
  • Adjusted EBITDA in the range of $34 to $36 million, a year-over-year improvement of approximately 27% at the midpoint.

Full year 2021:

  • Revenue of $325 to $330 million, a year-over-year increase of 34% at the midpoint, which is unchanged from the midpoint of the previous guidance range provided on July 29, 2021.
  • Adjusted EBITDA in the range of $103 to $105 million, a year-over-year increase of 42% at the midpoint, unchanged from the previous guidance range provided on July 29, 2021.

With respect to the Company’s expectations under “Fourth Quarter and Full Year 2021 Guidance” above, the Company has not reconciled the non-GAAP measure Adjusted EBITDA to the GAAP measure net income in this press release because the Company does not provide guidance for stock-based compensation expense, depreciation and amortization expense, acquisition-related costs, interest income, and income taxes on a consistent basis as the Company is unable to quantify these amounts without unreasonable efforts, which would be required to include a reconciliation of Adjusted EBITDA to GAAP net income. In addition, the Company believes such a reconciliation would imply a degree of precision that could be confusing or misleading to investors.

Conference Call and Webcast Information

DoubleVerify will host a conference call and live webcast to discuss its third quarter 2021 financial results at 4:30 p.m. Eastern Time today, Nov 9, 2021. To access the conference call, dial (888) 645-4404 for the U.S. or Canada, or (862) 298-0702 for international callers. The webcast will be available live on the Investors section of the Company’s website at https://ir.doubleverify.com/. In addition, an archived webcast will be available approximately two hours after the conclusion of the live event.

Key Business Terms

Advertiser Direct revenue is generated from the verification and measurement of advertising impressions that are directly purchased on digital media properties, including publishers and social media platforms.

Advertiser Programmatic revenue is generated from the evaluation, verification and measurement of advertising impressions purchased through programmatic demand-side platforms.

Supply-Side revenue is generated from platforms and publisher partners who use DoubleVerify’s data analytics to evaluate, verify and measure their advertising inventory.

Gross Revenue Retention Rate is the total prior period revenue earned from advertiser customers, less the portion of prior period revenue attributable to lost advertiser customers, divided by the total prior period revenue from advertiser customers.

Media Transactions Measured (MTM) is the volume of media transactions that DoubleVerify’s software platform measures.

Measured Transaction Fee (MTF) is the fixed fee DoubleVerify charges per thousand Media Transactions Measured.

DoubleVerify Holdings, Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

 

 

 

As of

 

As of

(in thousands, except per share data)

 

September 30, 2021

 

December 31, 2020

Assets:

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

Cash and cash equivalents

 

$

319,825

 

 

$

33,354

 

Trade receivables, net of allowances for doubtful accounts of $5,246 and $7,049 as of September 30, 2021 and December 31, 2020 respectively

 

 

95,509

 

 

 

94,677

 

Prepaid expenses and other current assets

 

 

9,326

 

 

 

13,904

 

Total current assets

 

 

424,660

 

 

 

141,935

 

Property, plant and equipment, net

 

 

16,693

 

 

 

18,107

 

Goodwill

 

 

244,672

 

 

 

227,349

 

Intangible assets, net

 

 

117,705

 

 

 

121,710

 

Deferred tax assets

 

 

82

 

 

 

82

 

Other non-current assets

 

 

2,185

 

 

 

2,151

 

Total assets

 

$

805,997

 

 

$

511,334

 

Liabilities and Stockholders' Equity:

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

Trade payables

 

$

4,105

 

 

$

3,495

 

Accrued expense

 

 

25,127

 

 

 

25,419

 

Income tax liabilities

 

 

540

 

 

 

1,277

 

Current portion of capital lease obligations

 

 

2,140

 

 

 

1,515

 

Contingent considerations current

 

 

1,717

 

 

 

1,198

 

Other current liabilities

 

 

3,986

 

 

 

1,116

 

Total current liabilities

 

 

37,615

 

 

 

34,020

 

Long-term debt

 

 

 

 

 

22,000

 

Capital lease obligations

 

 

3,106

 

 

 

3,447

 

Deferred tax liabilities

 

 

29,732

 

 

 

31,418

 

Other non-current liabilities

 

 

2,788

 

 

 

3,292

 

Contingent considerations non-current

 

 

 

 

 

462

 

Total liabilities

 

$

73,241

 

 

$

94,639

 

Commitments and contingencies (Note 13)

 

 

 

 

 

 

Stockholders’ equity

 

 

 

 

 

 

Common stock, $0.001 par value, 1,000,000 shares authorized, 158,524 shares issued and 158,474 outstanding as of September 30, 2021; 700,000 shares authorized, 140,222 shares issued and 125,074 shares outstanding as of December 31, 2020

 

 

159

 

 

 

140

 

Preferred stock, $0.01 par value, 100,000 shares authorized, zero shares issued and outstanding as of September 30, 2021; 61,006 shares authorized, issued, and outstanding as of December 31, 2020. Liquidation preference: $350,000 as of December 31, 2020

 

 

 

 

 

610

 

Additional paid-in capital

 

 

677,588

 

 

 

620,679

 

Treasury stock, at cost, 50 shares and 15,146 shares as of September 30, 2021 and December 31, 2020, respectively

 

 

(1,802

)

 

 

(260,686

)

Retained earnings

 

 

55,941

 

 

 

54,941

 

Accumulated other comprehensive income, net of income taxes

 

 

870

 

 

 

1,011

 

Total stockholders’ equity

 

 

732,756

 

 

 

416,695

 

Total liabilities and stockholders' equity

 

$

805,997

 

 

$

511,334

 

DoubleVerify Holdings, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

(UNAUDITED)

 

 

 

Three Months Ended September 30,

 

Nine Months Ended September 30,

(in thousands, except per share data)

 

 

2021

 

 

2020

 

 

 

2021

 

 

 

2020

Revenue

 

$

83,098

 

$

61,037

 

 

$

227,208

 

 

$

165,276

Cost of revenue (exclusive of depreciation and amortization shown separately below)

 

 

13,435

 

 

8,998

 

 

 

35,929

 

 

 

23,963

Product development

 

 

16,359

 

 

13,087

 

 

 

45,658

 

 

 

34,324

Sales, marketing and customer support

 

 

19,539

 

 

16,728

 

 

 

54,653

 

 

 

41,880

General and administrative

 

 

14,465

 

 

10,369

 

 

 

58,317

 

 

 

29,327

Depreciation and amortization

 

 

7,492

 

 

6,087

 

 

 

21,989

 

 

 

18,167

Income from operations

 

 

11,808

 

 

5,768

 

 

 

10,662

 

 

 

17,615

Interest expense

 

 

249

 

 

858

 

 

 

936

 

 

 

2,958

Other expense, net

 

 

365

 

 

481

 

 

 

365

 

 

 

359

Income before income taxes

 

 

11,194

 

 

4,429

 

 

 

9,361

 

 

 

14,298

Income tax expense (benefit)

 

 

3,270

 

 

(1,376

)

 

 

8,361

 

 

 

1,975

Net income

 

$

7,924

 

$

5,805

 

 

$

1,000

 

 

$

12,323

Earnings per share:

 

 

 

 

 

 

 

 

Basic

 

$

0.05

 

$

0.04

 

 

$

0.01

 

 

$

0.09

Diluted

 

$

0.05

 

$

0.04

 

 

$

0.01

 

 

$

0.08

Weighted-average common stock outstanding:

 

 

 

 

 

 

 

 

Basic

 

 

158,045

 

 

139,841

 

 

 

144,305

 

 

 

139,779

Diluted

 

 

167,045

 

 

146,554

 

 

 

153,547

 

 

 

146,843

Comprehensive income:

 

 

 

 

 

 

 

 

Net income

 

$

7,924

 

$

5,805

 

 

$

1,000

 

 

$

12,323

Other comprehensive income:

 

 

 

 

 

 

 

 

Foreign currency cumulative translation adjustment

 

 

303

 

 

410

 

 

 

(141

)

 

 

488

Total comprehensive income

 

$

8,227

 

$

6,215

 

 

$

859

 

 

$

12,811

DoubleVerify Holdings, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (UNAUDITED)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Comprehensive

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Additional

 

 

 

 

Income (Loss)

 

Total

 

 

Common Stock

 

Preferred Stock

 

Treasury Stock

 

Paid-in

 

Retained

 

Net of

 

Stockholders’

(in thousands)

 

Shares

 

Amount

 

Shares

 

Amount

 

Shares

 

Amount

 

Capital

 

Earnings

 

Income Taxes

 

Equity

Balance as of January 1, 2021

 

140,222

 

$

140

 

61,006

 

 

$

610

 

 

15,146

 

 

$

(260,686

)

 

$

620,679

 

 

$

54,941

 

 

$

1,011

 

 

$

416,695

 

Foreign currency translation adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(799

)

 

 

(799

)

Stock-based compensation expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,538

 

 

 

 

 

 

 

 

 

2,538

 

Common stock issued upon exercise of stock options

 

180

 

 

 

 

 

 

 

 

 

 

 

 

 

 

538

 

 

 

 

 

 

 

 

 

538

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

5,644

 

 

 

 

 

 

5,644

 

Balance as of March 31, 2021

 

140,402

 

$

140

 

61,006

 

 

$

610

 

 

15,146

 

 

$

(260,686

)

 

$

623,755

 

 

$

60,585

 

 

$

212

 

 

$

424,616

 

Foreign currency translation adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

355

 

 

 

355

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4,714

 

 

 

 

 

 

 

 

 

4,714

 

Common stock issued upon exercise of stock options

 

871

 

 

2

 

 

 

 

 

 

 

 

 

 

 

 

2,907

 

 

 

 

 

 

 

 

 

2,909

 

Common stock issued upon vesting of restricted stock units

 

217

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Conversion of Series A preferred stock to common stock in connection with initial public offering

 

5,190

 

 

5

 

(61,006

)

 

 

(610

)

 

(15,146

)

 

 

260,686

 

 

 

(260,081

)

 

 

 

 

 

 

 

 

 

Issuance of common stock in connection with initial public offering

 

9,977

 

 

10

 

 

 

 

 

 

 

 

 

 

 

 

269,380

 

 

 

 

 

 

 

 

 

269,390

 

Issuance of common stock in connection with the private placement concurrent with the initial public offering

 

1,111

 

 

1

 

 

 

 

 

 

 

 

 

 

 

 

29,999

 

 

 

 

 

 

 

 

 

30,000

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(12,568

)

 

 

 

 

 

(12,568

)

Balance as of June 30, 2021

 

157,768

 

$

158

 

 

 

$

 

 

 

 

$

 

 

$

670,674

 

 

$

48,017

 

 

$

567

 

 

$

719,416

 

Foreign currency translation adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

303

 

 

 

303

 

Shares repurchased for settlement of employee tax withholdings

 

 

 

 

 

 

 

 

 

50

 

 

 

(1,802

)

 

 

 

 

 

 

 

 

 

 

 

(1,802

)

Stock-based compensation expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4,848

 

 

 

 

 

 

 

 

 

4,848

 

Common stock issued upon exercise of stock options

 

651

 

 

1

 

 

 

 

 

 

 

 

 

 

 

 

2,066

 

 

 

 

 

 

 

 

 

2,067

 

Common stock issued upon vesting of restricted stock units

 

105

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7,924

 

 

 

 

 

 

7,924

 

Balance as of September 30, 2021

 

158,524

 

$

159

 

 

 

$

 

 

50

 

 

$

(1,802

)

 

$

677,588

 

 

$

55,941

 

 

$

870

 

 

$

732,756

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as of January 1, 2020

 

139,721

 

$

140

 

 

 

$

 

 

 

 

$

 

 

$

283,457

 

 

$

34,488

 

 

$

(67

)

 

$

318,018

 

Foreign currency translation adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(153

)

 

 

(153

)

Stock-based compensation expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

802

 

 

 

 

 

 

 

 

 

802

 

Common stock issued upon exercise of stock options

 

32

 

 

 

 

 

 

 

 

 

 

 

 

 

 

70

 

 

 

 

 

 

 

 

 

70

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,440

 

 

 

 

 

 

2,440

 

Balance as of March 31, 2020

 

139,753

 

$

140

 

 

 

$

 

 

 

 

$

 

 

$

284,329

 

 

$

36,928

 

 

$

(220

)

 

$

321,177

 

Foreign currency translation adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

231

 

 

 

231

 

Stock-based compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,140

 

 

 

 

 

 

 

 

 

1,140

 

Common stock issued upon exercise of stock options

 

58

 

 

 

 

 

 

 

 

 

 

 

 

 

 

51

 

 

 

 

 

 

 

 

 

51

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4,078

 

 

 

 

 

 

4,078

 

Balance as of June 30, 2020

 

139,811

 

$

140

 

 

 

$

 

 

 

 

$

 

 

$

285,520

 

 

$

41,006

 

 

$

11

 

 

$

326,677

 

Foreign currency translation adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

410

 

 

 

410

 

Stock-based compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,619

 

 

 

 

 

 

 

 

 

1,619

 

Common stock issued under employee purchase plan

 

61

 

 

 

 

 

 

 

 

 

 

 

 

 

 

423

 

 

 

 

 

 

 

 

 

423

 

Common stock issued upon exercise of stock options

 

44

 

 

 

 

 

 

 

 

 

 

 

 

 

 

263

 

 

 

 

 

 

 

 

 

263

 

Common stock issued upon vesting of restricted stock units

 

19

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

5,805

 

 

 

 

 

 

5,805

 

Balance as of September 30, 2020

 

139,935

 

$

140

 

 

 

$

 

 

 

 

$

 

 

$

287,825

 

 

$

46,811

 

 

$

421

 

 

$

335,197

 

DoubleVerify Holdings, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

 

 

 

Nine Months Ended

 

 

September 30,

(in thousands)

 

2021

 

2020

Operating activities:

 

 

 

 

 

 

Net income

 

$

1,000

 

 

$

12,323

 

Adjustments to reconcile net income to net cash provided by operating activities

 

 

 

 

 

 

Bad debt (recovery) expense

 

 

(1,186

)

 

 

3,041

 

Depreciation and amortization expense

 

 

21,989

 

 

 

18,167

 

Amortization of debt issuance costs

 

 

221

 

 

 

211

 

Accretion of acquisition liabilities

 

 

 

 

 

36

 

Deferred taxes

 

 

(4,572

)

 

 

(3,912

)

Stock-based compensation expense

 

 

12,100

 

 

 

3,561

 

Interest expense (income)

 

 

130

 

 

 

(36

)

Change in fair value of contingent consideration

 

 

57

 

 

 

(949

)

Offering costs

 

 

21,797

 

 

 

1,852

 

Other

 

 

661

 

 

 

742

 

Changes in operating assets and liabilities net of effect of business combinations

 

 

 

 

 

 

Trade receivables

 

 

690

 

 

 

(11,633

)

Prepaid expenses and other current assets

 

 

4,590

 

 

 

(3,457

)

Other non-current assets

 

 

(162

)

 

 

(9

)

Trade payables

 

 

425

 

 

 

1,881

 

Accrued expenses

 

 

(684

)

 

 

2,081

 

Other current liabilities

 

 

2,747

 

 

 

(7,143

)

Other non-current liabilities

 

 

(1,369

)

 

 

1,082

 

Net cash provided by operating activities

 

 

58,434

 

 

 

17,838

 

Investing activities:

 

 

 

 

 

 

Purchase of property, plant and equipment

 

 

(5,499

)

 

 

(6,545

)

Acquisition of business, net of cash acquired

 

 

(24,323

)

 

 

 

Net cash (used in) investing activities

 

 

(29,822

)

 

 

(6,545

)

Financing activities:

 

 

 

 

 

 

Payments of long-term debt

 

 

(22,000

)

 

 

(563

)

Deferred payment related to Leiki acquisition

 

 

 

 

 

(2,033

)

Deferred payment related to Zentrick acquisition

 

 

(50

)

 

 

(50

)

Payment of contingent consideration related to Zentrick acquisition

 

 

 

 

 

(601

)

Proceeds from common stock issued upon exercise of stock options

 

 

5,514

 

 

 

383

 

Proceeds from common stock issued under employee purchase plan

 

 

 

 

 

425

 

Proceeds from issuance of common stock upon initial public offering

 

 

269,390

 

 

 

 

Proceeds from issuance of common stock in connection with concurrent private placement

 

 

30,000

 

 

 

 

Payments related to offering costs

 

 

(21,797

)

 

 

(1,230

)

Capital lease payments

 

 

(1,222

)

 

 

(1,242

)

Shares repurchased for settlement of employee tax withholdings

 

 

(1,802

)

 

 

 

Net cash provided by (used in) financing activities

 

 

258,033

 

 

 

(4,911

)

Effect of exchange rate changes on cash and cash equivalents and restricted cash

 

 

(173

)

 

 

(38

)

Net increase in cash, cash equivalents, and restricted cash

 

 

286,472

 

 

 

6,344

 

Cash, cash equivalents, and restricted cash - Beginning of period

 

 

33,395

 

 

 

11,342

 

Cash, cash equivalents, and restricted cash - End of period

 

$

319,867

 

 

$

17,686

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

 

319,825

 

 

 

17,289

 

Restricted cash (included in prepaid expenses and other current assets on the Condensed Consolidated Balance Sheets)

 

 

42

 

 

 

397

 

Total cash and cash equivalents and restricted cash

 

$

319,867

 

 

$

17,686

 

Supplemental cash flow information:

 

 

 

 

 

 

Cash paid for taxes

 

 

5,586

 

 

 

14,901

 

Cash paid for interest

 

 

580

 

 

 

2,692

 

Non-cash investing and financing activities:

 

 

 

 

 

 

Conversion of Series A preferred stock to common stock in connection with the initial public offering

 

 

610

 

 

 

 

Treasury stock reissued upon the conversion of Series A preferred stock to common stock

 

 

260,686

 

 

 

 

Acquisition of equipment under capital lease

 

 

1,518

 

 

 

973

 

Capital assets financed by accounts payable

 

 

41

 

 

 

1,313

 

Offering costs included in accounts payable and accrued expense

 

 

 

 

 

772

 

Comparison of the Three and Nine Months Ended September 30, 2021 and September 30, 2020

Revenue

 

Three Months Ended September 30,

 

Change

 

Change

 

Nine Months Ended September 30,

 

Change

 

Change

 

2021

 

2020

 

$

 

%

 

2021

 

2020

 

$

 

%

 

(In Thousands)

 

 

 

 

 

 

 

(In Thousands)

 

 

 

 

 

 

Revenue by customer type:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Advertiser - direct

$

34,057

 

$

27,582

 

$

6,475

 

23

%

 

$

93,260

 

$

73,476

 

$

19,784

 

27

%

Advertiser - programmatic

 

41,902

 

 

28,044

 

 

13,858

 

49

 

 

 

113,694

 

 

76,023

 

 

37,671

 

50

 

Supply-side customer

 

7,139

 

 

5,411

 

 

1,728

 

32

 

 

 

20,254

 

 

15,777

 

 

4,477

 

28

 

Total revenue

$

83,098

 

$

61,037

 

$

22,061

 

36

%

 

$

227,208

 

$

165,276

 

$

61,932

 

37

%

Adjusted EBITDA

In addition to our results determined in accordance with GAAP, we believe that certain non-GAAP financial measures, including Adjusted EBITDA and Adjusted EBITDA Margin, are useful in evaluating our business. A metric similar to Adjusted EBITDA is used in certain calculations under our New Revolving Credit Facility. We calculate Adjusted EBITDA Margin as Adjusted EBITDA divided by total revenue. The following table presents a reconciliation of Adjusted EBITDA, a non-GAAP financial measure, to the most directly comparable financial measure prepared in accordance with GAAP.

 

Three Months Ended September 30,

 

Nine Months Ended September 30,

 

2021

 

2020

 

2021

 

2020

 

(In Thousands)

 

(In Thousands)

Net income

$

7,924

 

 

$

5,805

 

 

$

1,000

 

 

$

12,323

 

Net income margin

 

10

%

 

 

10

%

 

 

0

%

 

 

7

%

Depreciation and amortization

 

7,492

 

 

 

6,087

 

 

 

21,989

 

 

 

18,167

 

Stock-based compensation

 

4,848

 

 

 

1,619

 

 

 

12,100

 

 

 

3,561

 

Interest expense

 

249

 

 

 

858

 

 

 

936

 

 

 

2,958

 

Income tax expense (benefit)

 

3,270

 

 

 

(1,376

)

 

 

8,361

 

 

 

1,975

 

M&A costs (recoveries) (a)

 

1,079

 

 

 

(25

)

 

 

1,128

 

 

 

198

 

Offering costs and IPO readiness costs (b)

 

318

 

 

 

768

 

 

 

22,465

 

 

 

2,995

 

Other costs (c)

 

878

 

 

 

307

 

 

 

987

 

 

 

3,031

 

Other expense (d)

 

365

 

 

 

481

 

 

 

365

 

 

 

359

 

Adjusted EBITDA

$

26,423

 

 

$

14,524

 

 

$

69,331

 

 

$

45,567

 

Adjusted EBITDA margin

 

32

%

 

 

24

%

 

 

31

%

 

 

28

%

(a)

M&A costs (recoveries) for the three and nine months ended September 30, 2021 consist of transaction costs related to the acquisition of Meetrics and other deferred compensation costs related to acquisitions. M&A costs for the three and nine months ended September 30, 2020 consist of deferred compensation costs related to acquisitions.

(b)

Offering costs and IPO readiness costs for the three and nine months ended September 30, 2021 and 2020 consist of third-party costs incurred in preparation and completion for our IPO and other transaction related expenses.

(c)

Other costs for the three and nine months ended September 30, 2021 consist of reimbursements paid to Providence for costs incurred prior to the IPO date and non-recurring recognition of a cease-use liability related to unoccupied leased office space. For the three and nine months ended September 30, 2020, other costs include reimbursements paid to Providence as well as costs related to the departure of our former Chief Executive Officer, and third-party costs incurred in response to investigating and remediating certain IT/cybersecurity matters that occurred in March 2020.

(d)

Other expense for the three and nine months ended September 30, 2021 and 2020 consists of changes in fair value associated with contingent considerations and the impact of foreign currency transaction gains and losses associated with monetary assets and liabilities.

We use Adjusted EBITDA and Adjusted EBITDA Margin as measures of operational efficiency to understand and evaluate our core business operations. We believe that these non-GAAP financial measures are useful to investors for period to period comparisons of our core business and for understanding and evaluating trends in our operating results on a consistent basis by excluding items that we do not believe are indicative of our core operating performance.

These non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as substitutes for an analysis of our results as reported under GAAP. Some of the limitations of these measures are:

  • they do not reflect changes in, or cash requirements for, our working capital needs;
  • Adjusted EBITDA does not reflect our capital expenditures or future requirements for capital expenditures or contractual commitments;
  • they do not reflect income tax expense or the cash requirements to pay income taxes;
  • they do not reflect our interest expense or the cash requirements necessary to service interest or principal payments on our debt; and
  • although depreciation and amortization are non-cash charges related mainly to intangible assets, certain assets being depreciated and amortized will have to be replaced in the future, and Adjusted EBITDA does not reflect any cash requirements for such replacements.

In addition, other companies in our industry may calculate these non-GAAP financial measures differently than we do, limiting their usefulness as a comparative measure. You should compensate for these limitations by relying primarily on our GAAP results and using the non-GAAP financial measures only supplementally.

Total stock-based compensation expense recorded in the Condensed Consolidated Statements of Operations and Comprehensive Income as follows:

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30,

 

September 30,

(in thousands)

 

2021

 

2020

 

2021

 

2020

Product development

 

$

1,239

 

$

212

 

$

1,953

 

$

465

Sales, marketing and customer support

 

 

1,423

 

 

305

 

 

3,743

 

 

869

General and administrative

 

 

2,186

 

 

1,102

 

 

6,404

 

 

2,227

Total stock-based compensation

 

$

4,848

 

$

1,619

 

$

12,100

 

$

3,561

Forward-Looking Statements

This press release includes “forward-looking statements,” including with respect to the initial public offering. Forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond our control. We caution you that the forward-looking information presented in this press release is not a guarantee of future events, and that actual events may differ materially from those made in or suggested by the forward-looking information contained in this press release. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology such as “may,” “plan,” “seek,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe” or “continue” or the negative thereof or variations thereon or similar terminology. Any forward-looking information presented herein is made only as of the date of this press release, and we do not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.

About DoubleVerify

DoubleVerify is a leading software platform for digital media measurement and analytics. Our mission is to make the digital advertising ecosystem stronger, safer and more secure, thereby preserving the fair value exchange between buyers and sellers of digital media. Hundreds of Fortune 500 advertisers employ our unbiased data and analytics to drive campaign quality and effectiveness, and to maximize return on their digital advertising investments – globally.

View source version on businesswire.com:https://www.businesswire.com/news/home/20211109006402/en/

CONTACT: Media ContactChris Harihar

Crenshaw Communications

646-535-9475

chris@crenshawcomm.comInvestor RelationsTejal Engman

DoubleVerify

IR@doubleverify.com

KEYWORD: UNITED STATES NORTH AMERICA NEW YORK

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SOURCE: DoubleVerify

Copyright Business Wire 2021.

PUB: 11/09/2021 04:05 PM/DISC: 11/09/2021 04:06 PM

http://www.businesswire.com/news/home/20211109006402/en