As companies face slower growth globally, they need to spend more wisely and effectively with their available marketing and advertising budgets. This is where COMSCORE, Inc. (NASDAQ:SCOR) fits in; the company provides an intelligence platform that allows customers to analyze and deliver more cost-effective digital marketing.
Strong numbers
Management continues to pursue the company’s top four key priorities, which include maintaining measurement leadership (in mobile and multi-platform), continuing campaign measurement progress and global roll-out, capitalizing on the Digital Analytix momentum, and executing to improve margins and free cash flow. COMSCORE, Inc. (NASDAQ:SCOR) delivered a strong Q1 and the share price jumped over 19% after the earnings release.
For Q1, the record level pro forma revenue was $67.5 million, up 12% year-over-year, driven by strength in audience analytics and new products. The profitability was strong for Q1, with pro forma adjusted EBITDA of $12.6 million, driven by higher revenue and cost controls. The company also generated free cash flow of $16.9 million.
The Procter & Gamble Company (NYSE:PG) as a strategic partner
New products, including Validated Campaign Essentials (vCE), DAx, subscriber analytics, and Mobile Metrix 2.0, will contribute around 28%-30% to comScore’s annual contract value in 2013. COMSCORE, Inc. (NASDAQ:SCOR) had formed a partnership with The Procter & Gamble Company (NYSE:PG), the largest advertiser in the world, which provides consumer packaged goods. Procter & Gamble has over 300 brands spread across 180 countries, and invests heavily (around $8 billion) in advertising. However, The Procter & Gamble Company (NYSE:PG) continues to work on cost cutting due to competitive pricing and slowing growth. More effective spending and marketing remains an important priority for Procter & Gamble.
American Express Company (NYSE:AXP) is another major client signed up for vCE service. American Express is a global payments and network company, which also provides travel services. American Express also spent heavily on advertising and ranked No. 8 for America’s biggest advertisers, with over $2.1 billion of total ad spending in 2011. American Express Company (NYSE:AXP) continues to focus on premium quality lending, while investors are concerned about increasing operating expenses. American Express Company (NYSE:AXP) will continue to rely on media/ad technology to cost-effectively boost growth.
Procter & Gamble and American Express are not alone, as 22 of the top 25 largest global advertisers (89% of global ad dollars) are vCE/CE clients. Further, top ten CPG advertisers also work with comScore. COMSCORE, Inc. (NASDAQ:SCOR) continues to be supported with a strong client base.
Outlook
The management expects revenue of $65.6 million-$68 million, with an adjusted EBITDA of $10.5 million-$12.0 million for Q2, 2012. For 2013, non-GAAP pro forma revenue is expected to be $275.5 million-$283.5 million with pro forma adjusted EBITDA of $48.3 million-$54.8 million.
