RTHM revenues jumped 60% on last year as company realigns strategy with core products

Companies: Rhythmone



RhythmOne plc gave a preliminary H1 trading update this morning, saying performance for the period was expected to be "materially ahead of management expectations".


The group expects revenues of at least $80M (80% from Core mobile, video and programmatic products), and an adj EBITDA loss of $2.9m, a 60% improvement year-on-year. 


Despite the loss, the company saw profitable performance for adj EBITDA in the last two months of the period:


"...significantly ahead of internal estimates"

Today's positive update was largely due to RHTM's realignment toward Core mobile, video and programmatic products:


"Total programmatic transaction volume grew by over 85% year-on-year, with notable increases in quality. This was due to new and expanding Supply and Demand integrations and the international launch of the platform across Canada, Australia and 7 EU markets."

Speaking about today's update, stockbroker N+1 Singer said:


"Today’s trading update confirms that both strategic and operational progress is continuing. Revenues (“at least US$80m”) look on track despite the faster than expected reduction of non-core revenues. With the Core said to be 80% of H1 revenues RTHM appears to have already achieved the mix change target it was aiming for by the end of the year. A faster reduction in non-core means that costs can be lowered further and efficiency improved. This bodes well for profitability and we flag the H1 EBITDA loss guidance is estimated to be less than US$2.9m and we expect consensus EBITDA of around breakeven to move slightly positive.


The acceleration of Programmatic is driving the core and improvements in customer demand and international expansion point to a business on the front foot. News flow is likely to remain positive and the business looks likely to enter a growth phase that also delivers healthy profitability."

CEO S. Brian Mukherjee said that within a year RHTM had built an "industry-leading" programmatic platform:


"Our ability to source and represent unique, quality inventory at scale remains a core strength of the Company - one that we intend to augment through both organic and inorganic means. We maintain that the significant steps we took in FY2016 to realign the business around our Core capabilities have set the stage for both top-line revenue growth and a return to full year profitability in FY2017."



The information contained within this post is based on personal experience and opinion and should not be considered as a recommendation to trade nor financial advice.