NEW YORK, Oct. 28, 2020 /PRNewswire/ -- Criteo S.A.
(NASDAQ: CRTO), the global technology company powering the world's
marketers with trusted and impactful advertising, today announced
financial results for the third quarter ended September
30, 2020 that exceeded the top end of its most recent
quarterly guidance, despite the continued impact of the
pandemic.
Third Quarter 2020 Financial Highlights:
Our financial results reflect the continued impact of the
pandemic on our business. The following table summarizes our
consolidated financial results for the three months ended
September 30, 2019 and 2020:
|
Three Months
Ended
|
|
September
30,
|
|
2020
|
|
2019
|
|
YoY
Change
|
|
(in millions,
except EPS data)
|
GAAP
Results
|
|
|
|
|
|
Revenue
|
$
|
470
|
|
|
$
|
523
|
|
|
(10)
|
%
|
Net Income
|
$
|
5
|
|
|
$
|
21
|
|
|
(74)
|
%
|
Diluted
EPS
|
$
|
0.09
|
|
|
$
|
0.28
|
|
|
$ (0.19)
|
|
Cash from operating
activities
|
$
|
51
|
|
|
$
|
43
|
|
|
18
|
%
|
Net cash
position
|
$
|
627
|
|
|
$
|
409
|
|
|
53
|
%
|
|
|
|
|
|
|
Non-GAAP
Results1
|
|
|
|
|
|
Revenue
ex-TAC
|
$
|
186
|
|
|
$
|
221
|
|
|
(16)
|
%
|
Revenue ex-TAC
margin
|
40
|
%
|
|
42
|
%
|
|
|
Adjusted
EBITDA
|
$
|
49
|
|
|
$
|
64
|
|
|
(23)
|
%
|
Adjusted diluted
EPS
|
$
|
0.40
|
|
|
$
|
0.54
|
|
|
$ (0.14)
|
|
Free Cash
Flow
|
$
|
38
|
|
|
$
|
19
|
|
|
98
|
%
|
Megan Clarken, Chief Executive
Officer of Criteo, said, "We are pleased to deliver better
performance than expected on both the top and bottom lines,
demonstrating the continued resilience of our business during the
pandemic, relentless focus on improving execution and the talent,
strength and dedication of our great people."
Clarken continued: "As we look forward, we are transforming our
company to a Commerce Media Platform over the next few years to
maximize the value of our unique Reach and Commerce assets,
enabling our strong customer base, including global brands and
retailers, to optimize their sales and digital advertising returns.
We believe we have a path to growth over time with a clear
product roadmap, a dedicated leadership team and the financial
strength to support growth investments."
Operating Highlights
- Criteo and The Trade Desk collaborate on industry wide Unified
ID 2.0, an upgraded alternative to third-party
cookies.
- Total clients grew 3% year-over-year to close to 20,600 after
adding over 200 net new clients, the highest number since Q4
2019.
- Same-client revenue2 declined 6% year-over-year (vs.
13% decline in Q2 2020) and same-client Revenue ex-TAC2
decreased 11% year-over-year (vs. 14% decline in Q2 2020) at
constant currency3, including approximately 17 points
directly attributable to the COVID-19 disruption on both.
- New solutions grew 43% year-over-year to 19% of total Revenue
ex-TAC.
- Retail Media grew close to 60% year-over-year, and same-client
Revenue ex-TAC3 for Retail Media increased 70%
year-over-year.
- Our direct header-bidding technology now connects to close to
5,000 direct publishers.
___________________________________________________
|
1
|
Revenue excluding
Traffic Acquisition Costs, or Revenue ex-TAC, Revenue ex-TAC
margin, Adjusted EBITDA, Adjusted EBITDA at constant currency,
Adjusted EBITDA margin, Adjusted diluted EPS, Free Cash Flow and
growth at constant currency are not measures calculated in
accordance with U.S. GAAP.
|
2
|
Same-client revenue
or Revenue ex-TAC is the revenue or Revenue ex-TAC generated by
clients that were live with us in a given quarter and still live
with us the same quarter in the following year.
|
3
|
Constant currency
measures exclude the impact of foreign currency fluctuations and is
computed by applying the 2019 average exchange rates for the
relevant period to 2020 figures.
|
Financial Summary
Revenue for the quarter was $470
million and Revenue ex-TAC was $186
million. Adjusted EBITDA was over $49
million, resulting in an adjusted diluted EPS of
$0.40. These all reflect
year-over-year declines, largely due to the anticipated negative
COVID impact. Excluding the impact of the pandemic, we estimate
that Revenue ex-TAC declined about 2% in Q3 2020. Free cash flow
was $38 million in Q3 2020, growing
98% year-over-year, and $98 million
for the nine months 2020. We have $627M cash on the balance sheet, which includes
$158M from the Revolving Credit
Facility.
Sarah Glickman, Chief Financial
Officer, said, "During Q3 we continued to make progress against all
four of our strategic pillars and I am pleased that we were able to
control costs and grow free cash flow. Our goal now is to return to
growth and ensure smart investment allocation while reducing
fixed costs."
Revenue and Revenue ex-TAC
Revenue declined 10% year-over-year, or 11% at constant
currency, to $470 million (Q3 2019: $523 million),
after an estimated $80 million net
negative business impact from the COVID-19 disruption, or
approximately 15 points of the year-over-over decline at constant
currency. Revenue ex-TAC decreased 16% year-over-year, or 16% at
constant currency, to $186 million (Q3 2019:
$221 million), after an approximately $33 million net negative business impact from the
COVID-19 disruption, or approximately 15 points of the
year-over-over decline at constant currency. Growth in our
midmarket business and increased adoption of new solutions were
offset by the decline in our core business with large clients,
primarily as a result of the COVID-19 pandemic impact, in
particular on our Travel and Classifieds clients. Revenue ex-TAC as
a percentage of revenue, or Revenue ex-TAC margin, was 40% (Q3
2019: 42%).
- In the Americas, Revenue declined 4% year-over-year, or 3% at
constant currency, to $205 million
and represented 43% of total Revenue. Revenue ex-TAC declined 13%
year-over-year, or 11% at constant currency, to $74 million and represented 40% of total Revenue
ex-TAC.
- In EMEA, Revenue declined 10% year-over-year, or 13% at
constant currency, to $168 million
and represented 36% of total Revenue. Revenue ex-TAC declined 14%
year-over-year, or 17% at constant currency, to $71 million and represented 38% of total Revenue
ex-TAC.
- In Asia-Pacific, Revenue
declined 20% year-over-year, or 21% at constant currency, to
$98 million and represented 21% of
total Revenue. Revenue ex-TAC declined 23% year-over-year, or 24%
at constant currency, to $42 million
and represented 22% of total Revenue ex-TAC.
Net Income and Adjusted Net Income
Net income decreased 74% year-over-year to $5 million
(Q3 2019: $21 million). Net income margin as a percentage
of revenue was 1% (Q3 2019: 4%). In the course of the third
quarter 2020, we incurred $12 million
in restructuring related and transformation costs. Net income
available to shareholders of Criteo S.A. decreased 72%
year-over-year to $5 million, or $0.09 per share on a diluted basis (Q3 2019:
$19 million, or $0.28 per share
on a diluted basis).
Adjusted Net Income, or net income adjusted to eliminate the
impact of equity awards compensation expense, amortization of
acquisition-related intangible assets, acquisition-related costs
and deferred price consideration, restructuring related and
transformation costs and the tax impact of these adjustments,
decreased 31% year-over-year to $24 million, or $0.40 per share on a diluted basis (Q3 2019:
$35 million, or $0.54 per share
on a diluted basis).
Adjusted EBITDA and Operating Expenses
Adjusted EBITDA decreased 23% year-over-year, or 27% at constant
currency, to $49 million (Q3 2019: $64 million),
driven by the Revenue ex-TAC performance over the period, including
the still meaningful impact of the COVID-19 pandemic, partly offset
by effective expense management measures. Adjusted EBITDA as a
percentage of Revenue ex-TAC, or Adjusted EBITDA margin, was 27%
(Q3 2019: 29%).
Operating expenses decreased 11% or $17
million, to $143 million (Q3 2019:
$160 million), mostly driven by lower headcount-related
expense and disciplined expense management across the Company.
Operating expenses, excluding the impact of equity awards
compensation expense, pension costs, restructuring related and
transformation costs, depreciation and amortization and
acquisition-related costs and deferred price consideration, which
we refer to as Non-GAAP Operating Expenses, decreased 15% or
$21 million, to $117 million
(Q3 2019: $138 million), largely
driven by lower headcount and robust expense management across
the Company.
The Company intends to manage its expense base in a disciplined
way, while also investing in growth and innovation.
Cash Flow, Cash and Financial Liquidity Position
Cash flow from operating activities increased 18% year-over-year
to $51 million (Q3 2019: $43 million).
Free Cash Flow, defined as cash flow from operating activities
less acquisition of intangible assets, property, plant and
equipment and change in accounts payable related to intangible
assets, property, plant and equipment, increased 98% to
$38 million (Q3 2019: $19 million), representing 77%
of Adjusted EBITDA for the third quarter (Q3 2019: 30%) and 66% for
the first nine months 2020 (9 months 2019: 44%).
Cash and cash equivalents increased $208
million compared to December 31,
2019 to $627 million, after spending $44 million on share repurchases in the first
nine months 2020, and preemptively drawing $158 million of the Company's €350 million
Revolving Credit Facility (RCF) in the second quarter.
The Company had financial liquidity in excess of $870 million, including its cash position and
RCF as of September 30,
2020.
Business Outlook
The following forward-looking statements reflect Criteo's
expectations as of October 28,
2020.
As of now, we continue to see a significant impact to our
business related to the pandemic, continued economic uncertainty,
customer demand and supply chain logistics of our clients.
Fourth quarter 2020 guidance:
- We expect Revenue ex-TAC to be between $223
million and $230 million, implying constant-currency
decline of approximately 15% at the midpoint.
-
- Assumes less concentrated peak Holiday Season compared to prior
years
- Assumes continued slow rebound in our Travel and
Classifieds verticals
- Assumes $17M negative impact from
Privacy headwinds in the fourth quarter
- We expect Adjusted EBITDA to be between $81
million and $88 million.
The above guidance for the fourth quarter ending December 31, 2020, assumes the following exchange
rates for the main currencies impacting our business: a U.S.
dollar-euro rate of 0.882, a U.S. dollar-Japanese Yen rate of 107,
a U.S. dollar-British pound rate of 0.79, a U.S. dollar-Korean Won
rate of 1,196 and a U.S. dollar-Brazilian real rate of 5.23.
The above guidance assumes no acquisitions are completed
during the fourth quarter ending December 31, 2020.
Reconciliation of Revenue ex-TAC and Adjusted EBITDA guidance to
the closest corresponding U.S. GAAP measure is not available
without unreasonable efforts on a forward-looking basis due to the
high variability, complexity and low visibility with respect to the
charges excluded from these non-GAAP measures; in particular, the
measures and effects of equity awards compensation expense specific
to equity compensation awards that are directly impacted by
unpredictable fluctuations in our share price. The variability of
the above charges could potentially have a significant impact on
our future U.S. GAAP financial results.
Non-GAAP Financial Measures
This press release and its attachments include the following
financial measures defined as non-GAAP financial measures by the
U.S. Securities and Exchange Commission ("SEC"): Revenue ex-TAC,
Revenue ex-TAC by Region, Revenue ex-TAC margin, Adjusted EBITDA,
Adjusted EBITDA margin, Adjusted Net Income, Adjusted diluted EPS,
Free Cash Flow and Non-GAAP Operating Expenses. These measures are
not calculated in accordance with U.S. GAAP.
Revenue ex-TAC is our revenue excluding Traffic Acquisition
Costs ("TAC") generated over the applicable measurement period and
Revenue ex-TAC by Region reflects our Revenue ex-TAC by our
geographies. Revenue ex-TAC, Revenue ex-TAC by Region and Revenue
ex-TAC margin are key measures used by our management and board of
directors to evaluate our operating performance, generate future
operating plans and make strategic decisions regarding the
allocation of capital. In particular, we believe that the
elimination of TAC from revenue can provide a useful measure for
period-to-period comparisons of our business and across our
geographies.
Accordingly, we believe that Revenue ex-TAC, Revenue ex-TAC by
Region and Revenue ex-TAC margin provide useful information to
investors and the market generally in understanding and evaluating
our operating results in the same manner as our management and
board of directors.
Adjusted EBITDA is our consolidated earnings before financial
income (expense), income taxes, depreciation and amortization,
adjusted to eliminate the impact of equity awards compensation
expense, pension service costs, restructuring related and
transformation costs, acquisition-related costs and deferred price
consideration.
During the period, we have broadened the definition of Adjusted
EBITDA to exclude costs related to restructuring and transformation
costs, in addition to restructuring charges previously
excluded. Adjusted EBITDA and Adjusted EBITDA margin are key
measures used by our management and board of directors to
understand and evaluate our core operating performance and trends,
to prepare and approve our annual budget and to develop short- and
long-term operational plans. In particular, we believe that by
eliminating equity awards compensation expense, pension service
costs, restructuring related and transformation costs,
acquisition-related costs and deferred price consideration,
Adjusted EBITDA and Adjusted EBITDA margin can provide useful
measures for period-to-period comparisons of our business.
Accordingly, we believe that Adjusted EBITDA and Adjusted EBITDA
margin provide useful information to investors and the market
generally in understanding and evaluating our results of operations
in the same manner as our management and board of
directors.
Adjusted Net Income is our net income adjusted to eliminate the
impact of equity awards compensation expense, amortization of
acquisition-related intangible assets, acquisition-related costs
and deferred price consideration, restructuring related and
transformation costs and the tax impact of these adjustments.
Adjusted Net Income and Adjusted diluted EPS are key measures used
by our management and board of directors to evaluate operating
performance, generate future operating plans and make strategic
decisions regarding the allocation of capital.
In particular, we believe that by eliminating equity awards
compensation expense, amortization of acquisition-related
intangible assets, acquisition-related costs and deferred price
consideration, restructuring related and transformation costs and
the tax impact of these adjustments, Adjusted Net Income and
Adjusted diluted EPS can provide useful measures for
period-to-period comparisons of our business. Accordingly, we
believe that Adjusted Net Income and Adjusted diluted EPS provide
useful information to investors and the market generally in
understanding and evaluating our results of operations in the same
manner as our management and board of directors.
Free Cash Flow is defined as cash flow from operating activities
less acquisition of intangible assets, property, plant and
equipment and change in accounts payable related to intangible
assets, property, plant and equipment. Free Cash Flow is a key
measure used by our management and board of directors to evaluate
the Company's ability to generate cash. Accordingly, we believe
that Free Cash Flow permits a more complete and comprehensive
analysis of our available cash flows.
Non-GAAP Operating Expenses are our consolidated operating
expenses adjusted to eliminate the impact of depreciation and
amortization, equity awards compensation expense, pension service
costs, restructuring related and transformation costs,
acquisition-related costs and deferred price consideration. The
Company uses Non-GAAP Operating Expenses to understand and compare
operating results across accounting periods, for internal budgeting
and forecasting purposes, for short-term and long-term operational
plans, and to assess and measure our financial performance and the
ability of our operations to generate cash. We believe Non-GAAP
Operating Expenses reflects our ongoing operating expenses in a
manner that allows for meaningful period-to-period comparisons and
analysis of trends in our business. As a result, we believe that
Non-GAAP Operating Expenses provides useful information to
investors in understanding and evaluating our core operating
performance and trends in the same manner as our management and in
comparing financial results across periods. In addition, Non-GAAP
Operating Expenses is a key component in calculating Adjusted
EBITDA, which is one of the key measures the Company uses to
provide its quarterly and annual business outlook to the investment
community.
Please refer to the supplemental financial tables provided in
the appendix of this press release for a reconciliation of Revenue
ex-TAC to revenue, Revenue ex-TAC by Region to revenue by region,
Adjusted EBITDA to net income, Adjusted Net Income to net income,
Free Cash Flow to cash flow from operating activities, and Non-GAAP
Operating Expenses to operating expenses, in each case, the most
comparable U.S. GAAP measure. Our use of non-GAAP financial
measures has limitations as an analytical tool, and you should not
consider such non-GAAP measures in isolation or as a substitute for
analysis of our financial results as reported under U.S. GAAP. Some
of these limitations are: 1) other companies, including companies
in our industry which have similar business arrangements, may
address the impact of TAC differently; and 2) other companies may
report Revenue ex-TAC, Revenue ex-TAC by Region, Adjusted EBITDA,
Adjusted Net Income, Free Cash Flow, Non-GAAP Operating Expenses or
similarly titled measures but calculate them differently or over
different regions, which reduces their usefulness as comparative
measures. Because of these and other limitations, you should
consider these measures alongside our U.S. GAAP financial results,
including revenue and net income.
Forward-Looking Statements Disclosure
This press release contains forward-looking statements,
including projected financial results for the quarter ending
December 31, 2020, our expectations regarding our market
opportunity and future growth prospects and other statements that
are not historical facts and involve risks and uncertainties that
could cause actual results to differ materially. Factors that might
cause or contribute to such differences include, but are not
limited to: failure related to our technology and our ability to
innovate and respond to changes in technology, uncertainty
regarding the scope and impact of the COVID-19 pandemic on our
employees, operations, revenue and cash flows, uncertainty
regarding our ability to access a consistent supply of internet
display advertising inventory and expand access to such inventory,
investments in new business opportunities and the timing of these
investments, whether the projected benefits of acquisitions
materialize as expected, uncertainty regarding international growth
and expansion, the impact of competition, uncertainty regarding
legislative, regulatory or self-regulatory developments regarding
data privacy matters and the impact of efforts by other
participants in our industry to comply therewith, the impact of
consumer resistance to the collection and sharing of data, our
ability to access data through third parties, failure to enhance
our brand cost-effectively, recent growth rates not being
indicative of future growth, our ability to manage growth,
potential fluctuations in operating results, our ability to grow
our base of clients, and the financial impact of maximizing Revenue
ex-TAC, as well as risks related to future opportunities and plans,
including the uncertainty of expected future financial performance
and results and those risks detailed from time-to-time under the
caption "Risk Factors" and elsewhere in the Company's SEC filings
and reports, including the Company's Annual Report on Form 10-K
filed with the SEC on March 2, 2020, and in subsequent
Quarterly Reports on Form 10-Q as well as future filings and
reports by the Company. Importantly, at this time, the COVID-19
pandemic is having a significant impact on Criteo's business,
financial condition, cash flow and results of operations. There are
significant uncertainties about the duration and the extent of the
impact of the virus.
Except as required by law, the Company undertakes no duty or
obligation to update any forward-looking statements contained in
this release as a result of new information, future events, changes
in expectations or otherwise.
Conference Call Information
Criteo's senior management team will discuss the Company's
earnings and provide a strategic update on a call that will take
place today, October 28, 2020, at
8:00 AM EDT, 1:00 PM CEST.
The conference call will be webcast live on the Company's website
http://ir.criteo.com and will be available for replay.
- U.S. callers: +1 855 209 8212
- International callers: +1 412 317 0788 or +33 1
76 74 05 02
Please ask to be joined into the "Criteo S.A." call.
About Criteo
Criteo (NASDAQ: CRTO) is the global technology company powering
the world's marketers with trusted and impactful advertising. 2,600
Criteo team members partner with over 20,000 customers and
thousands of publishers around the globe to deliver effective
advertising across all channels, by applying advanced machine
learning to unparalleled data sets. Criteo empowers companies of
all sizes with the technology they need to better know and serve
their customers. For more information, please visit
www.criteo.com.
Contacts
Criteo Investor Relations
Edouard Lassalle, SVP, Market Relations &
Capital Markets, e.lassalle@criteo.com
Clemence Vermersch, Associate,
Investor Relations, c.vermersch@criteo.com
Criteo Public Relations
Jessica Meyers, Director,
Public Relations, Americas, j.meyers@criteo.com
Financial information to follow
CRITEO
S.A. Consolidated Statement of Financial
Position (U.S. dollars in thousands,
unaudited)
|
|
|
|
December 31,
2019
|
|
September 30,
2020
|
Assets
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
418,763
|
|
|
$
|
626,744
|
|
Trade
receivables, net of allowances of $16.1 million and $38.3
million at December 31, 2019 and September 30, 2020,
respectively
|
|
481,732
|
|
|
335,583
|
|
Income
taxes
|
|
21,817
|
|
|
11,422
|
|
Other taxes
|
|
60,924
|
|
|
58,123
|
|
Other current
assets
|
|
17,225
|
|
|
19,278
|
|
Total current
assets
|
|
1,000,461
|
|
|
1,051,150
|
|
Property, plant and
equipment, net
|
|
194,161
|
|
|
195,679
|
|
Intangible assets,
net
|
|
86,886
|
|
|
78,340
|
|
Goodwill
|
|
317,100
|
|
|
319,595
|
|
Right of Use Asset -
operating lease
|
|
142,044
|
|
|
120,283
|
|
Marketable
securities
|
|
—
|
|
|
23,416
|
|
Non-current financial
assets
|
|
21,747
|
|
|
20,174
|
|
Deferred tax
assets
|
|
27,985
|
|
|
34,731
|
|
Total non-current assets
|
|
789,923
|
|
|
792,218
|
|
Total
assets
|
|
$
|
1,790,384
|
|
|
$
|
1,843,368
|
|
|
|
|
|
|
Liabilities and
shareholders' equity
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Trade
payables
|
|
$
|
390,277
|
|
|
$
|
293,480
|
|
Contingencies
|
|
6,385
|
|
|
960
|
|
Income
taxes
|
|
3,422
|
|
|
276
|
|
Financial liabilities
- current portion
|
|
3,636
|
|
|
167,033
|
|
Lease liability -
operating - current portion
|
|
45,853
|
|
|
48,691
|
|
Other taxes
|
|
50,099
|
|
|
45,998
|
|
Employee - related
payables
|
|
74,781
|
|
|
68,709
|
|
Other current
liabilities
|
|
35,886
|
|
|
43,299
|
|
Total current
liabilities
|
|
610,339
|
|
|
668,446
|
|
Deferred tax
liabilities
|
|
9,272
|
|
|
8,439
|
|
Retirement benefit
obligation
|
|
8,485
|
|
|
10,634
|
|
Financial liabilities
- non-current portion
|
|
769
|
|
|
44
|
|
Lease liability -
operating - non-current portion
|
|
117,988
|
|
|
90,560
|
|
Other non-current
liabilities
|
|
5,543
|
|
|
3,333
|
|
Total non-current liabilities
|
|
142,057
|
|
|
113,010
|
|
Total
liabilities
|
|
752,396
|
|
|
781,456
|
|
Commitments and
contingencies
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
Common shares, €0.025
par value, 66,197,181 and 66,083,172 shares authorized, issued and
outstanding at December 31, 2019 and September 30, 2020,
respectively.
|
|
2,158
|
|
|
2,155
|
|
Treasury stock,
3,903,673 and 5,989,258 shares at cost as of December 31, 2019 and
September 30, 2020, respectively.
|
|
(74,900)
|
|
|
(92,450)
|
|
Additional paid-in
capital
|
|
668,389
|
|
|
685,841
|
|
Accumulated other
comprehensive loss
|
|
(40,105)
|
|
|
(19,658)
|
|
Retained
earnings
|
|
451,725
|
|
|
452,932
|
|
Equity - attributable
to shareholders of Criteo S.A.
|
|
1,007,267
|
|
|
1,028,820
|
|
Non-controlling
interests
|
|
30,721
|
|
|
33,092
|
|
Total
equity
|
|
1,037,988
|
|
|
1,061,912
|
|
Total equity and
liabilities
|
|
$
|
1,790,384
|
|
|
$
|
1,843,368
|
|
CRITEO S.A.
Consolidated Statement of Income
(U.S. dollars in thousands, except share and per share data,
unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
Nine Months
Ended
|
|
|
|
|
September
30,
|
|
|
|
September
30,
|
|
|
|
|
2019
|
|
2020
|
|
YoY
Change
|
|
2019
|
|
2020
|
|
YoY
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
522,606
|
|
|
$
|
470,345
|
|
|
(10)
|
%
|
|
$
|
1,608,876
|
|
|
$
|
1,411,335
|
|
|
(12)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
Traffic acquisition
cost
|
|
(301,901)
|
|
|
(284,401)
|
|
|
(6)
|
%
|
|
(928,559)
|
|
|
(839,463)
|
|
|
(10)
|
%
|
Other cost of
revenue
|
|
(31,101)
|
|
|
(34,608)
|
|
|
11
|
%
|
|
(86,205)
|
|
|
(102,328)
|
|
|
19
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
189,604
|
|
|
151,336
|
|
|
(20)
|
%
|
|
594,112
|
|
|
469,544
|
|
|
(21)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development expenses
|
|
(41,414)
|
|
|
(30,954)
|
|
|
(25)
|
%
|
|
(132,006)
|
|
|
(99,716)
|
|
|
(24)
|
%
|
Sales and operations
expenses
|
|
(85,985)
|
|
|
(83,659)
|
|
|
(3)
|
%
|
|
(277,397)
|
|
|
(244,414)
|
|
|
(12)
|
%
|
General and
administrative expenses
|
|
(32,835)
|
|
|
(28,672)
|
|
|
(13)
|
%
|
|
(102,372)
|
|
|
(83,772)
|
|
|
(18)
|
%
|
Total Operating
expenses
|
|
(160,234)
|
|
|
(143,285)
|
|
|
(11)
|
%
|
|
(511,775)
|
|
|
(427,902)
|
|
|
(16)
|
%
|
Income from
operations
|
|
29,370
|
|
|
8,051
|
|
|
(73)
|
%
|
|
82,337
|
|
|
41,642
|
|
|
(49)
|
%
|
Financial
expense
|
|
(900)
|
|
|
(491)
|
|
|
(45)
|
%
|
|
(4,228)
|
|
|
(1,828)
|
|
|
(57)
|
%
|
Income before
taxes
|
|
28,470
|
|
|
7,560
|
|
|
(73)
|
%
|
|
78,109
|
|
|
39,814
|
|
|
(49)
|
%
|
Provision for income
taxes
|
|
(7,913)
|
|
|
(2,267)
|
|
|
(71)
|
%
|
|
(23,614)
|
|
|
(11,943)
|
|
|
(49)
|
%
|
Net Income
|
|
$
|
20,557
|
|
|
$
|
5,293
|
|
|
(74)
|
%
|
|
$
|
54,495
|
|
|
$
|
27,871
|
|
|
(49)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income available
to shareholders of Criteo S.A.
|
|
$
|
18,778
|
|
|
$
|
5,227
|
|
|
(72)
|
%
|
|
$
|
48,721
|
|
|
$
|
26,402
|
|
|
(46)
|
%
|
Net income available
to non-controlling interests
|
|
$
|
1,779
|
|
|
$
|
66
|
|
|
(96)
|
%
|
|
$
|
5,774
|
|
|
$
|
1,469
|
|
|
(75)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding used in computing per share amounts:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
64,868,545
|
|
|
60,080,598
|
|
|
|
|
64,600,869
|
|
|
61,059,345
|
|
|
|
Diluted
|
|
66,067,045
|
|
|
61,027,795
|
|
|
|
|
65,916,219
|
|
|
61,644,827
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income allocated
to shareholders per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.29
|
|
|
$
|
0.09
|
|
|
(69)
|
%
|
|
$
|
0.75
|
|
|
$
|
0.43
|
|
|
(43)
|
%
|
Diluted
|
|
$
|
0.28
|
|
|
$
|
0.09
|
|
|
(68)
|
%
|
|
$
|
0.74
|
|
|
$
|
0.43
|
|
|
(42)
|
%
|
CRITEO
S.A.
Consolidated
Statement of Cash Flows
(U.S. dollars in
thousands, unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
Nine Months
Ended
|
|
|
|
|
September
30,
|
|
|
|
September
30,
|
|
|
|
|
2019
|
|
2020
|
|
YoY
Change
|
|
2019
|
|
2020
|
|
YoY
Change
|
Net
income
|
|
$
|
20,557
|
|
|
$
|
5,293
|
|
|
(74)
|
%
|
|
$
|
54,495
|
|
|
$
|
27,871
|
|
|
(49)
|
%
|
Non-cash and
non-operating items
|
|
18,776
|
|
|
39,831
|
|
|
NM
|
|
72,735
|
|
|
105,742
|
|
|
45
|
%
|
- Amortization and provisions
|
|
19,455
|
|
|
24,680
|
|
|
27
|
%
|
|
57,381
|
|
|
79,631
|
|
|
39
|
%
|
- Equity awards compensation expense (1)
|
|
11,165
|
|
|
6,803
|
|
|
(39)
|
%
|
|
36,760
|
|
|
22,465
|
|
|
(39)
|
%
|
- Net gain or loss on disposal of non-current assets
|
|
—
|
|
|
591
|
|
|
NM
|
|
|
—
|
|
|
2,734
|
|
|
NM
|
|
- Change in deferred taxes
|
|
(2,710)
|
|
|
(80)
|
|
|
(97)
|
%
|
|
(1,374)
|
|
|
(7,697)
|
|
|
NM
|
|
- Change in income taxes
|
|
(9,309)
|
|
|
6,684
|
|
|
NM
|
|
|
(19,939)
|
|
|
7,411
|
|
|
NM
|
|
- Other
|
|
175
|
|
|
1,153
|
|
|
NM
|
|
|
(93)
|
|
|
1,198
|
|
|
NM
|
|
Changes in working
capital related to operating activities
|
|
3,956
|
|
|
6,032
|
|
|
52
|
%
|
|
36,243
|
|
|
7,663
|
|
|
(79)
|
%
|
- (Increase) / Decrease in trade receivables
|
|
14,821
|
|
|
(4,177)
|
|
|
NM
|
|
|
120,164
|
|
|
122,529
|
|
|
2
|
%
|
- Increase / (Decrease) in trade payables
|
|
(4,415)
|
|
|
8,494
|
|
|
NM
|
|
|
(77,895)
|
|
|
(95,303)
|
|
|
22
|
%
|
- (Increase) / Decrease in other current assets
|
|
638
|
|
|
(2,762)
|
|
|
NM
|
|
|
2,150
|
|
|
2,288
|
|
|
6
|
%
|
- Increase / (Decrease) in other current liabilities
|
|
(10,177)
|
|
|
6,303
|
|
|
NM
|
|
|
(4,726)
|
|
|
(20,145)
|
|
|
NM
|
|
- Change in operating lease liabilities and right of use
assets
|
|
3,089
|
|
|
(1,826)
|
|
|
NM
|
|
|
(3,450)
|
|
|
(1,706)
|
|
|
(51)
|
%
|
CASH FROM
OPERATING ACTIVITIES
|
|
43,289
|
|
|
51,156
|
|
|
18
|
%
|
|
163,473
|
|
|
141,276
|
|
|
(14)
|
%
|
Acquisition of
intangible assets, property, plant and equipment
|
|
(27,239)
|
|
|
(16,308)
|
|
|
(40)
|
%
|
|
(69,343)
|
|
|
(57,037)
|
|
|
(18)
|
%
|
Change in accounts
payable related to intangible assets, property, plant and
equipment
|
|
3,295
|
|
|
3,410
|
|
|
3
|
%
|
|
(11,077)
|
|
|
13,870
|
|
|
NM
|
|
(Payment for)
disposal of a business, net of cash acquired (disposed)
|
|
106
|
|
|
(3)
|
|
|
NM
|
|
|
(4,582)
|
|
|
(3)
|
|
|
(100)
|
%
|
Change in other
non-current financial assets
|
|
(165)
|
|
|
(280)
|
|
|
70
|
%
|
|
(1,349)
|
|
|
(20,629)
|
|
|
NM
|
|
CASH USED FOR
INVESTING ACTIVITIES
|
|
(24,003)
|
|
|
(13,181)
|
|
|
(45)
|
%
|
|
(86,351)
|
|
|
(63,799)
|
|
|
(26)
|
%
|
Proceeds from
borrowings under line-of-credit agreement
|
|
—
|
|
|
3,193
|
|
|
NM
|
|
|
—
|
|
|
157,503
|
|
|
NM
|
|
Repayment of
borrowings
|
|
(167)
|
|
|
(12)
|
|
|
(93)
|
%
|
|
(506)
|
|
|
(181)
|
|
|
(64)
|
%
|
Proceeds from capital
increase
|
|
725
|
|
|
117
|
|
|
(84)
|
%
|
|
638
|
|
|
101
|
|
|
(84)
|
%
|
Repurchase of
treasury stocks
|
|
(17,603)
|
|
|
(10,554)
|
|
|
(40)
|
%
|
|
(17,603)
|
|
|
(43,655)
|
|
|
NM
|
|
Change in other
financial liabilities
|
|
(928)
|
|
|
(1,083)
|
|
|
17
|
%
|
|
(1,167)
|
|
|
(2,010)
|
|
|
72
|
%
|
CASH (USED FOR)
FROM FINANCING ACTIVITIES
|
|
(17,973)
|
|
|
(8,339)
|
|
|
(54)
|
%
|
|
(18,638)
|
|
|
111,758
|
|
|
NM
|
|
Effect of exchange
rates changes on cash and cash equivalents
|
|
(14,188)
|
|
|
18,927
|
|
|
NM
|
|
|
(13,732)
|
|
|
18,746
|
|
|
NM
|
|
Net increase
(decrease) in cash and cash equivalents
|
|
(12,875)
|
|
|
48,563
|
|
|
NM
|
|
|
44,752
|
|
|
207,981
|
|
|
NM
|
|
Net cash and cash
equivalents at beginning of period
|
|
422,053
|
|
|
578,181
|
|
|
37
|
%
|
|
364,426
|
|
|
418,763
|
|
|
15
|
%
|
Net cash and cash
equivalents at end of period
|
|
$
|
409,178
|
|
|
$
|
626,744
|
|
|
53
|
%
|
|
$
|
409,178
|
|
|
$
|
626,744
|
|
|
53
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL
DISCLOSURES OF CASH FLOW INFORMATION
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash paid for taxes,
net of refunds
|
|
$
|
(19,932)
|
|
|
$
|
4,337
|
|
|
NM
|
|
|
$
|
(44,927)
|
|
|
$
|
(12,229)
|
|
|
(73)
|
%
|
Cash paid for
interest
|
|
$
|
(337)
|
|
|
$
|
(153)
|
|
|
(55)
|
%
|
|
$
|
(1,095)
|
|
|
$
|
(819)
|
|
|
(25)
|
%
|
(1)
|
Share-based
compensation expense according to ASC 718 Compensation - stock
compensation accounted for $10.8 million and $6.5 million of
equity awards compensation expense for the quarter ended September
30, 2019 and 2020, respectively, and $35.7 million and $21.4
million of equity awards compensation for the nine months ended
September 30, 2019 and 2020, respectively.
|
CRITEO
S.A. Reconciliation of Cash from Operating Activities to
Free Cash Flow (U.S. dollars in thousands,
unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
Nine Months
Ended
|
|
|
|
|
September
30,
|
|
|
|
September
30,
|
|
|
|
|
2019
|
|
2020
|
|
YoY
Change
|
|
2019
|
|
2020
|
|
YoY
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH FROM OPERATING
ACTIVITIES
|
|
$
|
43,289
|
|
|
$
|
51,156
|
|
|
18
|
%
|
|
$
|
163,473
|
|
|
$
|
141,276
|
|
|
(14)
|
%
|
Acquisition of
intangible assets, property, plant and equipment
|
|
(27,239)
|
|
|
(16,308)
|
|
|
(40)
|
%
|
|
(69,343)
|
|
|
(57,037)
|
|
|
(18)
|
%
|
Change in accounts
payable related to intangible assets, property, plant and
equipment
|
|
3,295
|
|
|
3,410
|
|
|
3
|
%
|
|
(11,077)
|
|
|
13,870
|
|
|
NM
|
|
FREE CASH FLOW
(1)
|
|
$
|
19,345
|
|
|
$
|
38,258
|
|
|
98
|
%
|
|
$
|
83,053
|
|
|
$
|
98,109
|
|
|
18
|
%
|
(1)
|
Free Cash Flow is
defined as cash flow from operating activities less acquisition of
intangible assets, property, plant and equipment and change in
accounts payable related to intangible assets, property, plant and
equipment.
|
CRITEO
S.A. Reconciliation of Revenue ex-TAC by Region to
Revenue by Region (U.S. dollars in thousands,
unaudited)
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
Nine Months
Ended
|
|
|
|
|
|
|
|
September
30,
|
|
|
|
|
|
September
30,
|
|
|
|
|
|
Region
|
|
2019
|
|
2020
|
|
YoY
Change
|
|
YoY Change at
Constant Currency
|
|
2019
|
|
2020
|
|
YoY
Change
|
|
YoY Change at
Constant Currency
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas
|
|
$
|
213,937
|
|
|
$
|
204,618
|
|
|
(4)
|
%
|
|
(3)
|
%
|
|
$
|
645,904
|
|
|
$
|
582,037
|
|
|
(10)
|
%
|
|
(9)
|
%
|
|
EMEA
|
|
185,556
|
|
|
167,800
|
|
|
(10)
|
%
|
|
(13)
|
%
|
|
589,558
|
|
|
517,535
|
|
|
(12)
|
%
|
|
(12)
|
%
|
|
Asia-Pacific
|
|
123,113
|
|
|
97,927
|
|
|
(20)
|
%
|
|
(21)
|
%
|
|
373,414
|
|
|
311,763
|
|
|
(17)
|
%
|
|
(17)
|
%
|
|
Total
|
|
522,606
|
|
|
470,345
|
|
|
(10)
|
%
|
|
(11)
|
%
|
|
1,608,876
|
|
|
1,411,335
|
|
|
(12)
|
%
|
|
(12)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Traffic acquisition
costs
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas
|
|
(129,047)
|
|
|
(130,756)
|
|
|
1
|
%
|
|
3
|
%
|
|
(390,083)
|
|
|
(366,095)
|
|
|
(6)
|
%
|
|
(5)
|
%
|
|
EMEA
|
|
(103,899)
|
|
|
(97,272)
|
|
|
(6)
|
%
|
|
(10)
|
%
|
|
(328,591)
|
|
|
(295,822)
|
|
|
(10)
|
%
|
|
(9)
|
%
|
|
Asia-Pacific
|
|
(68,955)
|
|
|
(56,373)
|
|
|
(18)
|
%
|
|
(19)
|
%
|
|
(209,885)
|
|
|
(177,546)
|
|
|
(15)
|
%
|
|
(16)
|
%
|
|
Total
|
|
(301,901)
|
|
|
(284,401)
|
|
|
(6)
|
%
|
|
(7)
|
%
|
|
(928,559)
|
|
|
(839,463)
|
|
|
(10)
|
%
|
|
(9)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue ex-TAC
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas
|
|
84,890
|
|
|
73,862
|
|
|
(13)
|
%
|
|
(11)
|
%
|
|
255,821
|
|
|
215,942
|
|
|
(16)
|
%
|
|
(14)
|
%
|
|
EMEA
|
|
81,657
|
|
|
70,528
|
|
|
(14)
|
%
|
|
(17)
|
%
|
|
260,967
|
|
|
221,713
|
|
|
(15)
|
%
|
|
(14)
|
%
|
|
Asia-Pacific
|
|
54,158
|
|
|
41,554
|
|
|
(23)
|
%
|
|
(24)
|
%
|
|
163,529
|
|
|
134,217
|
|
|
(18)
|
%
|
|
(18)
|
%
|
|
Total
|
|
$
|
220,705
|
|
|
$
|
185,944
|
|
|
(16)
|
%
|
|
(16)
|
%
|
|
$
|
680,317
|
|
|
$
|
571,872
|
|
|
(16)
|
%
|
|
(15)
|
%
|
(1)
|
We define Revenue
ex-TAC as our revenue excluding traffic acquisition costs generated
over the applicable measurement period. Revenue ex-TAC and Revenue,
Traffic Acquisition Costs and Revenue ex-TAC by Region are not
measures calculated in accordance with U.S. GAAP. We have included
Revenue ex-TAC and Revenue, Traffic Acquisition Costs and Revenue
ex-TAC by Region because they are key measures used by our
management and board of directors to evaluate operating
performance, generate future operating plans and make strategic
decisions regarding the allocation of capital. In particular, we
believe that the elimination of TAC from revenue and review of
these measures by region can provide useful measures for
period-to-period comparisons of our business. Accordingly, we
believe that Revenue ex-TAC and Revenue, Traffic Acquisition Costs
and Revenue ex-TAC by Region provide useful information to
investors and others in understanding and evaluating our results of
operations in the same manner as our management and board of
directors. Our use of Revenue ex-TAC and Revenue, Traffic
Acquisition Costs and Revenue ex-TAC by Region has limitations as
an analytical tool, and you should not consider them in isolation
or as a substitute for analysis of our financial results as
reported under U.S. GAAP. Some of these limitations are: (a) other
companies, including companies in our industry which have similar
business arrangements, may address the impact of TAC differently;
(b) other companies may report Revenue, Traffic Acquisition Costs
and Revenue ex-TAC by Region or similarly titled measures but
define the regions differently, which reduces their effectiveness
as a comparative measure; and (c) other companies may report
Revenue ex-TAC or similarly titled measures but calculate them
differently, which reduces their usefulness as a comparative
measure. Because of these and other limitations, you should
consider Revenue ex-TAC and Revenue, Traffic Acquisition Costs and
Revenue ex-TAC by Region alongside our other U.S. GAAP financial
results, including revenue. The above table provides a
reconciliation of Revenue ex-TAC to revenue and Revenue ex-TAC by
Region to revenue by region.
|
CRITEO
S.A. Reconciliation of Adjusted EBITDA to Net
Income (U.S. dollars in thousands,
unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
Nine Months
Ended
|
|
|
|
|
September
30,
|
|
|
|
September
30,
|
|
|
|
|
2019
|
|
2020
|
|
YoY
Change
|
|
2019
|
|
2020
|
|
YoY
Change
|
Net income
|
|
$
|
20,557
|
|
|
$
|
5,293
|
|
|
(74)
|
%
|
|
$
|
54,495
|
|
|
$
|
27,871
|
|
|
(49)
|
%
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial
expense
|
|
900
|
|
|
491
|
|
|
(45)
|
%
|
|
4,228
|
|
|
1,828
|
|
|
(57)
|
%
|
Provision for income
taxes
|
|
7,913
|
|
|
2,267
|
|
|
(71)
|
%
|
|
23,614
|
|
|
11,943
|
|
|
(49)
|
%
|
Equity awards
compensation expense
|
|
11,770
|
|
|
6,803
|
|
|
(42)
|
%
|
|
40,043
|
|
|
22,465
|
|
|
(44)
|
%
|
Research and
development
|
|
3,230
|
|
|
3,333
|
|
|
3
|
%
|
|
11,458
|
|
|
7,771
|
|
|
(32)
|
%
|
Sales and
operations
|
|
4,398
|
|
|
3,190
|
|
|
(27)
|
%
|
|
16,292
|
|
|
8,380
|
|
|
(49)
|
%
|
General and
administrative
|
|
4,142
|
|
|
280
|
|
|
(93)
|
%
|
|
12,293
|
|
|
6,314
|
|
|
(49)
|
%
|
Pension service
costs
|
|
388
|
|
|
572
|
|
|
47
|
%
|
|
1,173
|
|
|
1,649
|
|
|
41
|
%
|
Research and
development
|
|
188
|
|
|
286
|
|
|
52
|
%
|
|
572
|
|
|
824
|
|
|
44
|
%
|
Sales and
operations
|
|
71
|
|
|
101
|
|
|
42
|
%
|
|
214
|
|
|
291
|
|
|
36
|
%
|
General and
administrative
|
|
129
|
|
|
185
|
|
|
43
|
%
|
|
387
|
|
|
534
|
|
|
38
|
%
|
Depreciation and
amortization expense
|
|
22,388
|
|
|
21,752
|
|
|
(3)
|
%
|
|
62,999
|
|
|
66,098
|
|
|
5
|
%
|
Cost of
revenue
|
|
12,193
|
|
|
14,712
|
|
|
21
|
%
|
|
32,175
|
|
|
40,581
|
|
|
26
|
%
|
Research and
development (1)
|
|
4,249
|
|
|
1,721
|
|
|
(59)
|
%
|
|
11,260
|
|
|
9,029
|
|
|
(20)
|
%
|
Sales and
operations
|
|
4,178
|
|
|
4,176
|
|
|
—
|
%
|
|
14,151
|
|
|
12,737
|
|
|
(10)
|
%
|
General and
administrative
|
|
1,768
|
|
|
1,143
|
|
|
(35)
|
%
|
|
5,413
|
|
|
3,751
|
|
|
(31)
|
%
|
Acquisition-related
costs
|
|
—
|
|
|
112
|
|
|
NM
|
|
|
—
|
|
|
112
|
|
|
NM
|
|
General and
administrative
|
|
—
|
|
|
112
|
|
|
NM
|
|
|
—
|
|
|
112
|
|
|
NM
|
|
Restructuring related
and transformation costs (2)
|
|
303
|
|
|
12,181
|
|
|
NM
|
|
|
2,921
|
|
|
15,606
|
|
|
NM
|
|
Research and
development
|
|
172
|
|
|
1,985
|
|
|
NM
|
|
|
296
|
|
|
3,493
|
|
|
NM
|
|
Sales and
operations
|
|
131
|
|
|
5,357
|
|
|
NM
|
|
|
2,196
|
|
|
6,793
|
|
|
NM
|
|
General and
administrative
|
|
—
|
|
|
4,839
|
|
|
NM
|
|
|
429
|
|
|
5,320
|
|
|
NM
|
|
Total net
adjustments
|
|
43,662
|
|
|
44,178
|
|
|
1
|
%
|
|
134,978
|
|
|
119,701
|
|
|
(11)
|
%
|
Adjusted EBITDA
(3)
|
|
$
|
64,219
|
|
|
$
|
49,471
|
|
|
(23)
|
%
|
|
$
|
189,473
|
|
|
$
|
147,572
|
|
|
(22)
|
%
|
(1)
|
For the Nine
Months Ended September 30, 2020, the Company recognized an
accelerated amortization for Manage technology due to a revised
useful life in 2019
($4.0 million in Research and development).
|
(2)
|
For the Three Months
Ended and the Nine Months Ended September 2019, and September 2020,
respectively, the Company recognized restructuring related and
transformation costs following its new organizational structure
implemented to support its multi-product platform strategy and
office right sizing policy:
|
|
Three Months
Ended
|
Nine Months
Ended
|
|
September
30,
|
September
30,
|
|
2019
|
|
2020
|
2019
|
|
2020
|
(Gain) from
forfeitures of share-based compensation awards
|
(606)
|
|
|
—
|
|
(3,284)
|
|
|
—
|
|
Depreciation and
amortization expense
|
—
|
|
|
—
|
|
1,228
|
|
|
—
|
|
Facilities and
impairment related costs
|
—
|
|
|
7,023
|
|
1,647
|
|
|
8,817
|
|
Payroll related
costs
|
909
|
|
|
2,858
|
|
3,330
|
|
|
4,489
|
|
Consulting costs
related to transformation
|
—
|
|
|
2,300
|
|
—
|
|
|
2,300
|
|
Total
restructuring related and transformation costs
|
303
|
|
|
12,181
|
|
2,921
|
|
|
15,606
|
|
For the Three Months
Ended and the Nine Months Ended September 30, 2020, the cash
outflows related to restructuring related and transformation costs
were $6.2 million, and $13.0 million respectively, and were mainly
compromised of payroll costs, broker fees and termination penalties
related to facilities.
|
|
|
|
|
(3)
|
We define Adjusted
EBITDA as our consolidated earnings before financial income
(expense), income taxes, depreciation and amortization, adjusted to
eliminate the impact of equity awards compensation expense, pension
service costs, restructuring related and transformation costs,
acquisition-related costs and deferred price consideration.
Adjusted EBITDA is not a measure calculated in accordance with U.S.
GAAP. We have included Adjusted EBITDA because it is a key measure
used by our management and board of directors to understand and
evaluate our core operating performance and trends, to prepare and
approve our annual budget and to develop short-term and long-term
operational plans. In particular, we believe that the elimination
of equity awards compensation expense, pension service costs,
restructuring related and transformation costs, acquisition-related
costs and deferred price consideration in calculating Adjusted
EBITDA can provide a useful measure for period-to-period
comparisons of our business. Accordingly, we believe that Adjusted
EBITDA provides useful information to investors and others in
understanding and evaluating our results of operations in the same
manner as our management and board of directors. Our use of
Adjusted EBITDA has limitations as an analytical tool, and you
should not consider it in isolation or as a substitute for analysis
of our financial results as reported under U.S. GAAP. Some of these
limitations are: (a) although depreciation and amortization are
non-cash charges, the assets being depreciated and amortized may
have to be replaced in the future, and Adjusted EBITDA does not
reflect cash capital expenditure requirements for such replacements
or for new capital expenditure requirements; (b) Adjusted EBITDA
does not reflect changes in, or cash requirements for, our working
capital needs; (c) Adjusted EBITDA does not reflect the potentially
dilutive impact of equity-based compensation; (d) Adjusted EBITDA
does not reflect tax payments that may represent a reduction in
cash available to us; and (e) other companies, including companies
in our industry, may calculate Adjusted EBITDA or similarly titled
measures differently, which reduces their usefulness as a
comparative measure. Because of these and other limitations, you
should consider Adjusted EBITDA alongside our U.S. GAAP financial
results, including net income.
|
CRITEO
S.A. Reconciliation from Non-GAAP Operating Expenses to
Operating Expenses under GAAP (U.S. dollars in thousands,
unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
Nine Months
Ended
|
|
|
|
|
September
30,
|
|
|
|
September
30,
|
|
|
|
|
2019
|
|
2020
|
|
YoY
Change
|
|
2019
|
|
2020
|
|
YoY
Change
|
Research and
Development expenses
|
|
$
|
(41,414)
|
|
|
$
|
(30,954)
|
|
|
(25)
|
%
|
|
$
|
(132,006)
|
|
|
$
|
(99,716)
|
|
|
(24)
|
%
|
Equity awards
compensation expense
|
|
3,230
|
|
|
3,333
|
|
|
3
|
%
|
|
11,458
|
|
|
7,771
|
|
|
(32)
|
%
|
Depreciation and
Amortization expense (1)
|
|
4,249
|
|
|
1,721
|
|
|
(59)
|
%
|
|
11,260
|
|
|
9,029
|
|
|
(20)
|
%
|
Pension service
costs
|
|
188
|
|
|
286
|
|
|
52
|
%
|
|
572
|
|
|
824
|
|
|
44
|
%
|
Restructuring
related and transformation costs (2)
|
|
172
|
|
|
1,985
|
|
|
NM
|
|
|
296
|
|
|
3,493
|
|
|
NM
|
|
Non GAAP - Research
and Development expenses
|
|
(33,575)
|
|
|
(23,629)
|
|
|
(30)
|
%
|
|
(108,420)
|
|
|
(78,599)
|
|
|
(28)
|
%
|
Sales and Operations
expenses
|
|
(85,985)
|
|
|
(83,659)
|
|
|
(3)
|
%
|
|
(277,397)
|
|
|
(244,414)
|
|
|
(12)
|
%
|
Equity awards
compensation expense
|
|
4,398
|
|
|
3,190
|
|
|
(27)
|
%
|
|
16,292
|
|
|
8,380
|
|
|
(49)
|
%
|
Depreciation and
Amortization expense
|
|
4,178
|
|
|
4,176
|
|
|
—
|
%
|
|
14,151
|
|
|
12,737
|
|
|
(10)
|
%
|
Pension service
costs
|
|
71
|
|
|
101
|
|
|
42
|
%
|
|
214
|
|
|
291
|
|
|
36
|
%
|
Restructuring
related and transformation costs (2)
|
|
131
|
|
|
5,357
|
|
|
NM
|
|
|
2,196
|
|
|
6,793
|
|
|
NM
|
|
Non GAAP - Sales and
Operations expenses
|
|
(77,207)
|
|
|
(70,835)
|
|
|
(8)
|
%
|
|
(244,544)
|
|
|
(216,213)
|
|
|
(12)
|
%
|
General and
Administrative expenses
|
|
(32,835)
|
|
|
(28,672)
|
|
|
(13)
|
%
|
|
(102,372)
|
|
|
(83,772)
|
|
|
(18)
|
%
|
Equity awards
compensation expense
|
|
4,142
|
|
|
280
|
|
|
(93)
|
%
|
|
12,293
|
|
|
6,314
|
|
|
(49)
|
%
|
Depreciation and
Amortization expense
|
|
1,768
|
|
|
1,143
|
|
|
(35)
|
%
|
|
5,413
|
|
|
3,751
|
|
|
(31)
|
%
|
Pension service
costs
|
|
129
|
|
|
185
|
|
|
43
|
%
|
|
387
|
|
|
534
|
|
|
38
|
%
|
Acquisition
related costs
|
|
—
|
|
|
112
|
|
|
NM
|
|
|
—
|
|
|
112
|
|
|
NM
|
|
Restructuring
related and transformation costs (2)
|
|
—
|
|
|
4,839
|
|
|
NM
|
|
|
429
|
|
|
5,320
|
|
|
NM
|
|
Non GAAP - General
and Administrative expenses
|
|
(26,796)
|
|
|
(22,113)
|
|
|
(17)
|
%
|
|
(83,850)
|
|
|
(67,741)
|
|
|
(19)
|
%
|
Total Operating
expenses
|
|
(160,234)
|
|
|
(143,285)
|
|
|
(11)
|
%
|
|
(511,775)
|
|
|
(427,902)
|
|
|
(16)
|
%
|
Equity awards
compensation expense
|
|
11,770
|
|
|
6,803
|
|
|
(42)
|
%
|
|
40,043
|
|
|
22,465
|
|
|
(44)
|
%
|
Depreciation and
Amortization expense (1)
|
|
10,195
|
|
|
7,040
|
|
|
(31)
|
%
|
|
30,824
|
|
|
25,517
|
|
|
(17)
|
%
|
Pension service
costs
|
|
388
|
|
|
572
|
|
|
47
|
%
|
|
1,173
|
|
|
1,649
|
|
|
41
|
%
|
Acquisition-related costs
|
|
—
|
|
|
112
|
|
|
NM
|
|
|
—
|
|
|
112
|
|
|
NM
|
|
Restructuring
related and transformation costs (2)
|
|
303
|
|
|
12,181
|
|
|
NM
|
|
|
2,921
|
|
|
15,606
|
|
|
NM
|
|
Total Non GAAP
Operating expenses (3)
|
|
$
|
(137,578)
|
|
|
$
|
(116,577)
|
|
|
(15)
|
%
|
|
$
|
(436,814)
|
|
|
$
|
(362,553)
|
|
|
(17)
|
%
|
(1)
|
For the Nine
Months Ended September 30, 2020, the Company recognized an
accelerated amortization for Manage technology due to a revised
useful life in 2019 ($4.0 million in Research and
development).
|
(2)
|
For the Three Months
Ended and the Nine Months Ended September 2019, and September 2020,
respectively, the Company recognized restructuring related and
transformation costs following its new organizational structure
implemented to support its multi-product platform strategy and
office right sizing policy.
|
|
Three Months
Ended
|
Nine Months
Ended
|
|
September
30,
|
September
30,
|
|
2019
|
|
2020
|
2019
|
|
2020
|
(Gain) from
forfeitures of share-based compensation awards
|
(606)
|
|
|
—
|
|
(3,284)
|
|
|
—
|
|
Depreciation and
amortization expense
|
—
|
|
|
—
|
|
1,228
|
|
|
—
|
|
Facilities and
impairment related costs
|
—
|
|
|
7,023
|
|
1,647
|
|
|
8,817
|
|
Payroll related
costs
|
909
|
|
|
2,858
|
|
3,330
|
|
|
4,489
|
|
Consulting costs
related to transformation
|
—
|
|
|
2,300
|
|
—
|
|
|
2,300
|
|
Total
restructuring related and transformation costs
|
303
|
|
|
12,181
|
|
2,921
|
|
|
15,606
|
|
For the Three Months
Ended and the Nine Months Ended September 30, 2020, the cash
outflows related to restructuring related and transformation costs
were $6.2 million, and $13.0 million respectively, and were mainly
compromised of payroll costs, broker fees and termination penalties
related to facilities
|
|
|
|
|
(3)
|
We define Non-GAAP
Operating Expenses as our consolidated operating expenses adjusted
to eliminate the impact of depreciation and amortization, equity
awards compensation expense, pension service costs, restructuring
related and transformation costs, acquisition-related costs and
deferred price consideration. The Company uses Non-GAAP Operating
Expenses to understand and compare operating results across
accounting periods, for internal budgeting and forecasting
purposes, for short-term and long-term operational plans, and to
assess and measure our financial performance and the ability of our
operations to generate cash. We believe Non-GAAP Operating Expenses
reflects our ongoing operating expenses in a manner that allows for
meaningful period-to-period comparisons and analysis of trends in
our business. As a result, we believe that Non-GAAP Operating
Expenses provides useful information to investors in understanding
and evaluating our core operating performance and trends in the
same manner as our management and in comparing financial results
across periods. In addition, Non-GAAP Operating Expenses is a key
component in calculating Adjusted EBITDA, which is one of the key
measures we use to provide our quarterly and annual business
outlook to the investment community.
|
CRITEO
S.A. Detailed Information on Selected
Items (U.S. dollars in thousands,
unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
Nine Months
Ended
|
|
|
|
|
September
30,
|
|
|
|
September
30,
|
|
|
|
|
2019
|
|
2020
|
|
YoY
Change
|
|
2019
|
|
2020
|
|
YoY
Change
|
Equity awards
compensation expense
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development
|
|
$
|
3,230
|
|
|
$
|
3,333
|
|
|
3
|
%
|
|
$
|
11,458
|
|
|
$
|
7,771
|
|
|
(32)
|
%
|
Sales and
operations
|
|
4,398
|
|
|
3,190
|
|
|
(27)
|
%
|
|
16,292
|
|
|
8,380
|
|
|
(49)
|
%
|
General and
administrative
|
|
4,142
|
|
|
280
|
|
|
(93)
|
%
|
|
12,293
|
|
|
6,314
|
|
|
(49)
|
%
|
Total equity awards
compensation expense
|
|
11,770
|
|
|
6,803
|
|
|
(42)
|
%
|
|
40,043
|
|
|
22,465
|
|
|
(44)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pension service
costs
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development
|
|
188
|
|
|
286
|
|
|
52
|
%
|
|
572
|
|
|
824
|
|
|
44
|
%
|
Sales and
operations
|
|
71
|
|
|
101
|
|
|
42
|
%
|
|
214
|
|
|
291
|
|
|
36
|
%
|
General and
administrative
|
|
129
|
|
|
185
|
|
|
43
|
%
|
|
387
|
|
|
534
|
|
|
38
|
%
|
Total pension service
costs
|
|
388
|
|
|
572
|
|
|
47
|
%
|
|
1,173
|
|
|
1,649
|
|
|
41
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization expense
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
revenue
|
|
12,193
|
|
|
14,712
|
|
|
21
|
%
|
|
32,175
|
|
|
40,581
|
|
|
26
|
%
|
Research and
development (1)
|
|
4,249
|
|
|
1,721
|
|
|
(59)
|
%
|
|
11,260
|
|
|
9,029
|
|
|
(20)
|
%
|
Sales and
operations
|
|
4,178
|
|
|
4,176
|
|
|
—
|
%
|
|
14,151
|
|
|
12,737
|
|
|
(10)
|
%
|
General and
administrative
|
|
1,768
|
|
|
1,143
|
|
|
(35)
|
%
|
|
5,413
|
|
|
3,751
|
|
|
(31)
|
%
|
Total depreciation
and amortization expense
|
|
22,388
|
|
|
21,752
|
|
|
(3)
|
%
|
|
62,999
|
|
|
66,098
|
|
|
5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition-related
costs
|
|
|
|
|
|
|
|
|
|
|
|
|
General and
administrative
|
|
—
|
|
|
112
|
|
|
NM
|
|
|
—
|
|
|
112
|
|
|
NM
|
|
Total
acquisition-related costs
|
|
—
|
|
|
112
|
|
|
NM
|
|
|
—
|
|
|
112
|
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring related
and transformation costs (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development
|
|
172
|
|
|
1,985
|
|
|
NM
|
|
|
296
|
|
|
3,493
|
|
|
NM
|
|
Sales and
operations
|
|
131
|
|
|
5,357
|
|
|
NM
|
|
|
2,196
|
|
|
6,793
|
|
|
NM
|
|
General and
administrative
|
|
—
|
|
|
4,839
|
|
|
NM
|
|
|
429
|
|
|
5,320
|
|
|
NM
|
|
Total restructuring
related and transformation costs
|
|
$
|
303
|
|
|
$
|
12,181
|
|
|
NM
|
|
|
$
|
2,921
|
|
|
$
|
15,606
|
|
|
NM
|
|
(1)
|
For the Nine
Months Ended September 30, 2020, the Company recognized an
accelerated amortization for Manage technology due to a revised
useful life in 2019 ($4.0 million in Research and
development).
|
(2)
|
For the Three Months
Ended and the Nine Months Ended September 2019, and September 2020,
respectively, the Company recognized restructuring related and
transformation costs following its new organizational structure
implemented to support its multi-product platform strategy and
office right sizing policy:
|
|
Three Months
Ended
|
Nine Months
Ended
|
|
September
30,
|
September
30,
|
|
2019
|
|
2020
|
2019
|
|
2020
|
(Gain) from
forfeitures of share-based compensation awards
|
(606)
|
|
|
—
|
|
(3,284)
|
|
|
—
|
|
Depreciation and
amortization expense
|
—
|
|
|
—
|
|
1,228
|
|
|
—
|
|
Facilities and
impairment related costs
|
—
|
|
|
7,023
|
|
1,647
|
|
|
8,817
|
|
Payroll related
costs
|
909
|
|
|
2,858
|
|
3,330
|
|
|
4,489
|
|
Consulting costs
related to transformation
|
—
|
|
|
2,300
|
|
—
|
|
|
2,300
|
|
Total
restructuring related and transformation costs
|
303
|
|
|
12,181
|
|
2,921
|
|
|
15,606
|
|
For the Three Months
Ended and the Nine Months Ended September 30, 2020, the cash
outflows related to restructuring related and transformation costs
were $6.2 million, and
$13.0 million respectively, and were mainly compromised of payroll
costs, broker fees and termination penalties related to
facilities.
|
CRITEO
S.A. Reconciliation of Adjusted Net Income to Net
Income (U.S. dollars in thousands except share and per
share data, unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
Nine Months
Ended
|
|
|
|
|
September
30,
|
|
|
|
September
30,
|
|
|
|
|
2019
|
|
2020
|
|
YoY
Change
|
|
2019
|
|
2020
|
|
YoY
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
20,557
|
|
|
$
|
5,293
|
|
|
(74)
|
%
|
|
$
|
54,495
|
|
|
$
|
27,871
|
|
|
(49)
|
%
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity awards
compensation expense
|
|
11,770
|
|
|
6,803
|
|
|
(42)
|
%
|
|
40,043
|
|
|
22,465
|
|
|
(44)
|
%
|
Amortization of
acquisition-related intangible assets (1)
|
|
5,456
|
|
|
2,899
|
|
|
(47)
|
%
|
|
16,393
|
|
|
12,594
|
|
|
(23)
|
%
|
Acquisition-related
costs
|
|
—
|
|
|
112
|
|
|
NM
|
|
—
|
|
|
112
|
|
|
NM
|
Restructuring related
and transformation costs (2)
|
|
303
|
|
|
12,181
|
|
|
NM
|
|
2,921
|
|
|
15,606
|
|
|
NM
|
Tax impact of the
above adjustments
|
|
(2,640)
|
|
|
(2,986)
|
|
|
13
|
%
|
|
(7,971)
|
|
|
(5,611)
|
|
|
(30)
|
%
|
Total net
adjustments
|
|
14,889
|
|
|
19,009
|
|
|
28
|
%
|
|
51,386
|
|
|
45,166
|
|
|
(12)
|
%
|
Adjusted net income
(3)
|
|
$
|
35,446
|
|
|
$
|
24,302
|
|
|
(31)
|
%
|
|
$
|
105,881
|
|
|
$
|
73,037
|
|
|
(31)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
-
Basic
|
|
64,868,545
|
|
|
60,080,598
|
|
|
|
|
64,600,869
|
|
|
61,059,345
|
|
|
|
-
Diluted
|
|
66,067,045
|
|
|
61,027,795
|
|
|
|
|
65,916,219
|
|
|
61,644,827
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income
per share
|
|
|
|
|
|
|
|
|
|
|
|
|
-
Basic
|
|
$
|
0.55
|
|
|
$
|
0.40
|
|
|
(27)
|
%
|
|
$
|
1.64
|
|
|
$
|
1.20
|
|
|
(27)
|
%
|
-
Diluted
|
|
$
|
0.54
|
|
|
$
|
0.40
|
|
|
(26)
|
%
|
|
$
|
1.61
|
|
|
$
|
1.18
|
|
|
(27)
|
%
|
(1)
|
For the Nine
Months Ended September 30, 2020, the Company recognized an
accelerated amortization for Manage technology due to a revised
useful life in 2019 ($4.0 million in Research and
development).
|
(2)
|
For the Three Months
Ended and the Nine Months Ended September 2019, and September 2020,
respectively, the Company recognized restructuring related and
transformation costs following its new organizational
structure implemented to support its multi-product platform
strategy and office right sizing policy:
|
|
Three Months
Ended
|
Nine Months
Ended
|
|
September
30,
|
September
30,
|
|
2019
|
|
2020
|
2019
|
|
2020
|
(Gain) from
forfeitures of share-based compensation awards
|
(606)
|
|
|
—
|
|
(3,284)
|
|
|
—
|
|
Depreciation and
amortization expense
|
—
|
|
|
—
|
|
1,228
|
|
|
—
|
|
Facilities and
impairment related costs
|
—
|
|
|
7,023
|
|
1,647
|
|
|
8,817
|
|
Payroll related
costs
|
909
|
|
|
2,858
|
|
3,330
|
|
|
4,489
|
|
Consulting costs
related to transformation
|
—
|
|
|
2,300
|
|
—
|
|
|
2,300
|
|
Total
restructuring related and transformation costs
|
303
|
|
|
12,181
|
|
2,921
|
|
|
15,606
|
|
For the Three Months
Ended and the Nine Months Ended September 30, 2020, the cash
outflows related to restructuring related and transformation costs
were $6.2 million, and $13.0 million respectively, and were mainly
compromised of payroll costs, broker fees and termination penalties
related to facilities.
|
|
|
|
|
(3)
|
We define Adjusted
Net Income as our net income adjusted to eliminate the impact of
equity awards compensation expense, amortization of
acquisition-related intangible assets, restructuring related and
transformation costs, acquisition-related costs and deferred price
consideration and the tax impact of the foregoing adjustments.
Adjusted Net Income is not a measure calculated in accordance with
U.S. GAAP. We have included Adjusted Net Income because it is a key
measure used by our management and board of directors to evaluate
operating performance, generate future operating plans and make
strategic decisions regarding the allocation of capital. In
particular, we believe that the elimination of equity awards
compensation expense, amortization of acquisition-related
intangible assets, acquisition-related costs and deferred price
consideration, restructuring related and transformation costs and
the tax impact of the foregoing adjustments in calculating Adjusted
Net Income can provide a useful measure for period-to-period
comparisons of our business. Accordingly, we believe that Adjusted
Net Income provides useful information to investors and others in
understanding and evaluating our results of operations in the same
manner as our management and board of directors. Our use of
Adjusted Net Income has limitations as an analytical tool, and you
should not consider it in isolation or as a substitute for analysis
of our financial results as reported under U.S. GAAP. Some of these
limitations are: (a) Adjusted Net Income does not reflect the
potentially dilutive impact of equity-based compensation or the
impact of certain acquisition related costs; and (b) other
companies, including companies in our industry, may calculate
Adjusted Net Income or similarly titled measures differently, which
reduces their usefulness as a comparative measure. Because of these
and other limitations, you should consider Adjusted Net Income
alongside our other U.S. GAAP-based financial results, including
net income.
|
CRITEO
S.A. Constant Currency Reconciliation (U.S.
dollars in thousands, unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
Nine Months
Ended
|
|
|
|
|
September
30,
|
|
|
|
September
30,
|
|
|
|
|
2019
|
|
2020
|
|
YoY
Change
|
|
2019
|
|
2020
|
|
YoY
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue as
reported
|
|
$
|
522,606
|
|
|
$
|
470,345
|
|
|
(10)
|
%
|
|
$
|
1,608,876
|
|
|
$
|
1,411,335
|
|
|
(12)
|
%
|
Conversion impact
U.S. dollar/other currencies
|
|
|
|
(3,800)
|
|
|
|
|
|
|
11,732
|
|
|
|
Revenue at constant
currency(1)
|
|
522,606
|
|
|
466,545
|
|
|
(11)
|
%
|
|
1,608,876
|
|
|
1,423,067
|
|
|
(12)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Traffic acquisition
costs as reported
|
|
(301,901)
|
|
|
(284,401)
|
|
|
(6)
|
%
|
|
(928,559)
|
|
|
(839,463)
|
|
|
(10)
|
%
|
Conversion impact
U.S. dollar/other currencies
|
|
|
|
2,183
|
|
|
|
|
|
|
(6,473)
|
|
|
|
Traffic Acquisition
Costs at constant currency(1)
|
|
(301,901)
|
|
|
(282,218)
|
|
|
(7)
|
%
|
|
(928,559)
|
|
|
(845,936)
|
|
|
(9)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue ex-TAC as
reported(2)
|
|
220,705
|
|
|
185,944
|
|
|
(16)
|
%
|
|
680,317
|
|
|
571,872
|
|
|
(16)
|
%
|
Conversion impact
U.S. dollar/other currencies
|
|
|
|
(1,617)
|
|
|
|
|
|
|
5,259
|
|
|
|
Revenue ex-TAC at
constant currency(2)
|
|
220,705
|
|
|
184,327
|
|
|
(16)
|
%
|
|
680,317
|
|
|
577,131
|
|
|
(15)
|
%
|
Revenue
ex-TAC(2)/Revenue as reported
|
|
42
|
%
|
|
40
|
%
|
|
|
|
42
|
%
|
|
41
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other cost of revenue
as reported
|
|
(31,101)
|
|
|
(34,608)
|
|
|
11
|
%
|
|
(86,205)
|
|
|
(102,328)
|
|
|
19
|
%
|
Conversion impact
U.S. dollar/other currencies
|
|
|
|
(303)
|
|
|
|
|
|
|
(1,271)
|
|
|
|
Other cost of revenue
at constant currency(1)
|
|
(31,101)
|
|
|
(34,911)
|
|
|
12
|
%
|
|
(86,205)
|
|
|
(103,599)
|
|
|
20
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA(3)
|
|
64,219
|
|
|
49,471
|
|
|
(23)
|
%
|
|
189,473
|
|
|
147,572
|
|
|
(22)
|
%
|
Conversion impact
U.S. dollar/other currencies
|
|
|
|
(2,399)
|
|
|
|
|
|
|
(182)
|
|
|
|
Adjusted
EBITDA(3) at constant currency(1)
|
|
$
|
64,219
|
|
|
$
|
47,072
|
|
|
(27)
|
%
|
|
$
|
189,473
|
|
|
$
|
147,390
|
|
|
(22)
|
%
|
Adjusted
EBITDA(3)/Revenue ex-TAC(2)
|
|
29
|
%
|
|
27
|
%
|
|
|
|
28
|
%
|
|
26
|
%
|
|
|
(1)
|
Information herein
with respect to results presented on a constant currency basis is
computed by applying prior period average exchange rates to current
period results. We have included results on a constant currency
basis because it is a key measure used by our management and Board
of directors to evaluate operating performance. Management reviews
and analyzes business results excluding the effect of foreign
currency translation because they believe this better represents
our underlying business trends. The table above reconciles the
actual results presented in this section with the results presented
on a constant currency basis.
|
|
|
(2)
|
Revenue ex-TAC is not
a measure calculated in accordance with U.S. GAAP. See the table
entitled "Reconciliation of Revenue ex-TAC by Region to Revenue by
Region" for a reconciliation of Revenue Ex-TAC to
revenue.
|
|
|
(3)
|
Adjusted EBITDA is
not a measure calculated in accordance with U.S. GAAP. See the
table entitled "Reconciliation of Adjusted EBITDA to Net Income"
for a reconciliation of Adjusted EBITDA to net income.
|
CRITEO
S.A. Information on Share
Count (unaudited)
|
|
|
|
Nine Months
Ended
|
|
|
September
30,
|
|
|
2019
|
|
|
2020
|
|
Shares outstanding as
at January 1,
|
|
64,249,084
|
|
|
62,293,508
|
|
Weighted average
number of shares issued during the period
|
|
351,785
|
|
|
(1,234,163)
|
|
Basic number of
shares - Basic EPS basis
|
|
64,600,869
|
|
|
61,059,345
|
|
Dilutive effect of
share options, warrants, employee warrants - Treasury
method
|
|
1,315,350
|
|
|
585,482
|
|
Diluted number of
shares - Diluted EPS basis
|
|
65,916,219
|
|
|
61,644,827
|
|
|
|
|
|
|
Shares issued as at
September 30, before Treasury stocks
|
|
66,173,983
|
|
|
66,083,172
|
|
Treasury stock as of
September 30,
|
|
(1,807,251)
|
|
|
(5,989,258)
|
|
Shares outstanding as
of September 30, after Treasury stocks
|
|
64,366,732
|
|
|
60,093,914
|
|
Total dilutive effect
of share options, warrants, employee warrants
|
|
8,494,732
|
|
|
7,581,847
|
|
Fully diluted shares
as at September 30,
|
|
72,861,464
|
|
|
67,675,761
|
|
CRITEO
S.A. Supplemental Financial Information and Operating
Metrics (U.S. dollars in thousands except where stated,
unaudited)
|
|
|
Q3
2018
|
Q4
2018
|
Q1
2019
|
Q2
2019
|
Q3
2019
|
Q4
2019
|
Q1
2020
|
Q2
2020
|
Q3
2020
|
YoY
Change
|
QoQ
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Clients
|
19,213
|
19,419
|
19,373
|
19,733
|
19,971
|
20,247
|
20,360
|
20,359
|
20,565
|
3%
|
1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
528,869
|
670,096
|
558,123
|
528,147
|
522,606
|
652,640
|
503,376
|
437,614
|
470,345
|
(10)%
|
7%
|
|
Americas
|
211,247
|
317,350
|
217,993
|
213,974
|
213,937
|
306,250
|
191,745
|
185,674
|
204,618
|
(4)%
|
10%
|
|
EMEA
|
195,230
|
220,904
|
209,643
|
194,359
|
185,556
|
216,639
|
190,114
|
159,621
|
167,800
|
(10)%
|
5%
|
|
APAC
|
122,392
|
131,842
|
130,487
|
119,814
|
123,113
|
129,751
|
121,517
|
92,319
|
97,927
|
(20)%
|
6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TAC
|
(305,387)
|
(398,238)
|
(322,429)
|
(304,229)
|
(301,901)
|
(386,388)
|
(297,364)
|
(257,698)
|
(284,401)
|
(6)%
|
10%
|
|
Americas
|
(126,406)
|
(196,168)
|
(131,545)
|
(129,491)
|
(129,047)
|
(189,092)
|
(120,022)
|
(115,317)
|
(130,756)
|
1%
|
13%
|
|
EMEA
|
(111,131)
|
(128,053)
|
(117,291)
|
(107,401)
|
(103,899)
|
(124,939)
|
(108,397)
|
(90,153)
|
(97,272)
|
(6)%
|
8%
|
|
APAC
|
(67,850)
|
(74,017)
|
(73,593)
|
(67,337)
|
(68,955)
|
(72,357)
|
(68,945)
|
(52,228)
|
(56,373)
|
(18)%
|
8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue ex-TAC
(1)
|
223,482
|
271,858
|
235,694
|
223,918
|
220,705
|
266,252
|
206,012
|
179,916
|
185,944
|
(16)%
|
3%
|
|
Americas
|
84,841
|
121,182
|
86,448
|
84,483
|
84,890
|
117,158
|
71,723
|
70,357
|
73,862
|
(13)%
|
5%
|
|
EMEA
|
84,099
|
92,851
|
92,352
|
86,958
|
81,657
|
91,700
|
81,717
|
69,468
|
70,528
|
(14)%
|
2%
|
|
APAC
|
54,542
|
57,825
|
56,894
|
52,477
|
54,158
|
57,394
|
52,572
|
40,091
|
41,554
|
(23)%
|
4%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flow from
operating activities
|
50,256
|
85,600
|
67,220
|
52,964
|
43,289
|
59,359
|
56,743
|
33,377
|
51,156
|
18%
|
53%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
29,656
|
45,408
|
23,684
|
32,792
|
23,944
|
17,520
|
11,737
|
18,532
|
12,898
|
(46)%
|
(30)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital
expenditures/Revenue
|
6%
|
7%
|
4%
|
6%
|
5%
|
3%
|
2%
|
4%
|
3%
|
N.A
|
N.A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash
position
|
458,690
|
364,426
|
395,771
|
422,053
|
409,178
|
418,763
|
436,506
|
578,181
|
626,744
|
53%
|
8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Headcount
|
2,737
|
2,744
|
2,813
|
2,873
|
2,794
|
2,755
|
2,701
|
2,685
|
2,636
|
(6)%
|
(2)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Days Sales
Outstanding (days -
end of month)
|
60
|
58
|
59
|
58
|
57
|
52
|
62
|
61
|
62
|
N.A
|
N.A
|
|
|
(1)
|
We define Revenue
ex-TAC as our revenue excluding traffic acquisition costs generated
over the applicable measurement period. Revenue ex-TAC and Revenue,
Traffic Acquisition Costs and Revenue ex-TAC by Region are not
measures calculated in accordance with U.S. GAAP. We have included
Revenue ex-TAC and Revenue, Traffic Acquisition Costs and Revenue
ex-TAC by Region because they are key measures used by our
management and board of directors to evaluate operating
performance, generate future operating plans and make strategic
decisions regarding the allocation of capital. In particular, we
believe that the elimination of TAC from revenue and review of
these measures by region can provide useful measures for
period-to-period comparisons of our business. Accordingly, we
believe that Revenue ex-TAC and Revenue, Traffic Acquisition Costs
and Revenue ex-TAC by Region provide useful information to
investors and others in understanding and evaluating our results of
operations in the same manner as our management and board of
directors. Our use of Revenue ex-TAC and Revenue, Traffic
Acquisition Costs and Revenue ex-TAC by Region has limitations as
an analytical tool, and you should not consider them in isolation
or as a substitute for analysis of our financial results as
reported under U.S. GAAP. Some of these limitations are: (a) other
companies, including companies in our industry which have similar
business arrangements, may address the impact of TAC differently;
(b) other companies may report Revenue, Traffic Acquisition Costs
and Revenue ex-TAC by Region or similarly titled measures but
define the regions differently, which reduces their effectiveness
as a comparative measure; and (c) other companies may report
Revenue ex-TAC or similarly titled measures but calculate them
differently, which reduces their usefulness as a comparative
measure. Because of these and other limitations, you should
consider Revenue ex-TAC and Revenue, Traffic Acquisition Costs and
Revenue ex-TAC by Region alongside our other U.S. GAAP financial
results, including revenue. The above table provides a
reconciliation of Revenue ex-TAC to revenue and Revenue ex-TAC by
Region to revenue by region.
|
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SOURCE Criteo S.A.