Special Report: engage:BDR’s (ASX:EN1) strategy to become a profitable adtech has paid dividends, with the company booking a seven-figure profit for 2019.

Back in February last year, engage:BDR knuckled down, releasing its “strategic plan to profitability”.

Having now ticked all the boxes on the list, including cutting costs and bolstering its balance sheet, the company has reported 50 per cent growth in its revenue numbers to $17.1m and a 42 per cent jump in its gross margin to 54 per cent.

EBITDA (earnings before interest, taxes, depreciation and amortisation) has climbed out of the red, from a $7.3m loss to a $1.6m profit

This led to a $9.6m year-over-year improvement in net profit after tax (NPAT), which reached ($1.2m) in 2019.

Gross profit surged 216 per cent to $9.3m and net assets grew to $3.4m, from -$6.6m. Net tangible assets also moved into the black, coming in at $384,000 in 2019 compared to -$9.1m in 2018.

engage:BDR helps brands and advertising agencies bid for online advertising space automatically, whether on a website or social media platform.

It is the brainchild of former MySpace executive Ted Dhanik and MySpace founder Tom Anderson — more affectionately known as ‘MySpace Tom’.

engage:BDR says it hit every one of the initial milestones it outlined in its strategic plan for 2019, as well as achieved the subsequent, upgraded milestones.

The company successfully implemented several cost-saving measures that led to a 43 per cent reduction in staff costs and a 26 per cent drop in operating and administrative expenses, including tech infrastructure.

“EN1 has never been positioned better for revenue, profitability and market share growth,” co-founder and executive chairman Ted Dhanik told investors this morning.

“EN1 has a healthy balance sheet, is profitable, has scaling revenue and margins and has access to significant capital.

“More importantly, EN1 has the partnership integrations which differentiate the company from its US peers.”

 

Growth momentum not slowing

engage:BDR expects revenue, gross margins, EBITDA and NPAT to continue to increase in 2020 as a result of its client and partnership mix.

Right now, the company’s revenues for February are about 300 per cent ahead of February last year. This follows a 281 per cent year-over-year increase in January.

engage:BDR is keeping it simple in 2020, focusing on just three areas: NetZero publisher boarding, AdCel growth, and new integrations for the company’s programmatic ad exchange and scale existing.

The company announced just this week that its NetZero publisher payments product had gone live and had signed and integrated a new programmatic buyer – both of which were generating daily revenues of $10,500 between them and expected to be scaled up soon.

engage:BDR now anticipates much more than the original estimate of $235,000 monthly incremental revenue upon full integration for that publisher.

This story was developed in collaboration with engage:BDR, a Stockhead advertiser at the time of publishing.
This story does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

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