“Progress and change” were the watchwords for media and marketing analytics specialist Ebiquity plc (LON:EBQ) in 2016, and that should continue in 2017 as its Growth Acceleration Programme starts to bear fruit.
The AIM-listed group reported 5.5% growth in underlying pretax profits to £11.8mln in the full-year to December 31, up from £11.2mln a year earlier, as revenues increased by 9.1% to £83.6mln.
The firm saw its Media Value Measurement (MVM) business record total year-on-year revenue growth of 12.3%, while its Marketing Performance Optimization operations also continued to deliver strong growth, with total revenues up 31.2% on 2015.
Together MVM and MPO accounted for 72% of overall group revenues in 2016, up from 68% in 2015.
But revenues from its Market Intelligence unit fell 5.2% on a total basis largely due to an expected substantial decline in revenues from its project-based research business.
Ebiquity is paying a dividend of 0.65p, up from the 0.4p paid a year earlier continuing its progressive pay-out policy.
Michael Karg, Ebiquity’s CEO, said: "We have seen continued strong performance from our consultancy businesses MVM and MPO, which are at the core of the changing nature of the media landscape particularly around effectiveness and efficiency of marketing investments.
“We have already made good progress with our growth acceleration plan, which will replicate our service offering across key territories, further strengthening our ability to service global clients.”
New platform …
Ebiquity launched a new global advertising intelligence platform in September last year, extending its reach to 15 European countries and up to 80 territories worldwide.
It rolled out the platform to more than 120 companies with users across every continent.
The platform allows clients to access a database of over 25mln ads, as well as new charting and presentation capabilities, automated report functionality and an improved user interface.
Analysts at broker Numis Securities noted that Ebiquity’s final results were “in line with our expectations”.
“As outlined at the pre-close update the group made robust progress in Marketing Performance Optimisation, while Media Value Measurement was held back in its contract compliance business as clients digested the ANA report, and Market Intelligence was solid other than the expected decline in project-based reputation work.”
In July 2016, Ebiquity was a major contributor to a report from the US Association of National Advertisers (ANA) on transparency.
Commissioned after a study showed cash rebates to media agencies were pervasive in ad-buying, the ANA guidelines laid down a blueprint for contracts between marketers and agencies.
Ebiquity described it as one of the most important events in the company’s history.
Mind the GAP …
The Numis analysts added: “The group detailed its Growth Acceleration Plan last year and has already delivered on a number of milestones, for example the Strategic Media Consultancy, roll-out of effectiveness practices, digital product development and talent review programme.”
The analysts maintained their pretax profit forecasts of £12.3mln for 2017, and £11.3mln for 2018, the peak year of the GAP investment programme.
Repeating a ‘buy’ rating and 161p target price on the stock they concluded: “We remain firm supporters of Ebiquity and see further scope for the shares to re-rate as the benefits of the GAP are delivered over the coming years.”
Ebiquity shares held steady at 121p after the results, pausing having shot up by 20% in the year-to-date.
Further progress should be expected as the Growth Accelerations Plan plays out.