Quarterly Report • Oct 31, 2012
Quarterly Report
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(The Group's numbers in this interim report are recognised excluding discontinued operations unless otherwise stated. Numerical data in brackets refers to the corresponding period in 2011 unless otherwise stated. Rounding off differences may arise.)
This interim report will be presented at a press and analyst conference on 31 October 2012 at 11.00 a.m. in Tradedoubler's premises at Sveavägen 20. The presentation may also be followed via a webcast using the link: http://financials.tradedoubler.com/investorrelations.
| Jul-Sep | Jul-Sep | Jan-Sep | Jan-Sep | Full year | |
|---|---|---|---|---|---|
| MSEK | 2012 | 2011 | 2012 | 2011 | 2011 |
| Net sales | 526.1 | 653.9 | 1,740.0 | 1,911.2 | 2,612.7 |
| Gross profit | 119.7 | 152.5 | 406.9 | 459.3 | 626.5 |
| Operating profit | -7.8 | 31.3 | 2.1 | 88.3 | 127.1 |
| Net profit | -10.6 | 19.9 | -11.3 | 53.9 | 92.2 |
| Cash-flow from operating activities | 13.4 | 45.8 | -8.3 | 55.7 | 123.6 |
| Earnings per share, SEK | -0.25 | 0.47 | -0.26 | 1.26 | 2.16 |
| Cash-flow per share, SEK | 0.07 | 0.85 | -2.46 | 0.79 | 1.60 |
| Operating profit/Gross profit (%) | neg | 20.5 | 0.5 | 19.2 | 20.3 |
| Return on equity (12 months) (%) | 4.9 | 13.8 | 4.9 | 13.8 | 16.8 |
CEO's comments on the third quarter of 2012
Since I assumed the CEO position in August, we have conducted a thorough review of Tradedoubler's business and cost structure. It is clear that in order to restore growth and regain a market leading position, we need to sharpen the way we conduct our business.
In this work, I can draw on in-depth industry knowledge and experience gained from having successfully managed performance marketing businesses both in Europe and the US. We are now implementing an ambitious and achievable plan that establishes a clear foundation for future growth. We need to take steps on three main fronts:
Control: We have established a plan to bring costs under control. The aim moving forward is to continue to manage our cost structure, while channeling our investments into areas where they will create the most value.
Competitive situation: Our competitive position has weakened, which is reflected in declining sales and gross profit. The initial actions we are taking will halt this trend and then we will increasingly focus on re-establishing growth. There is no doubt that the competitive pressure is significant in the larger, more mature markets such as Germany, the Netherlands, Sweden and the UK. However, in Southern Europe, we are competing well despite continuing weak market conditions.
Business focus: The performance marketing sector is growing in Europe, a trend that is set to continue in the long-term, driven by developments in e-commerce and online advertising. We anticipate a healthy sector growth rate of 3-7 per cent annually over the next few years.
A detailed review of how Tradedoubler's business has been performing over time and in various countries as well as indepth interviews with large clients has shown that we have a strong position in the performance marketing sector. Our business model, where clients pay and get paid for results, is much appreciated by marketers and publishers.
In recent years we have sought to develop our business by expanding into non-core areas such as display advertising and search. We are now re-focusing on our core proposition – performance marketing - in order to take advantage of the sector growth.
The future: We are now executing our long-term strategy to get Tradedoubler back into a leadership position in performance marketing. This strategy will focus around three prioritized areas:
1) Prioritize key clients in key markets
2) Improve our service and product offering to become clients' first choice
3) Restructure our business to better serve the needs of our customers.
Our market is maturing and the ability to offer a technology solution that allows advertisers to manage their own private network is becoming increasingly important. We are in a unique position to take advantage of this market opportunity as, unlike our competitors, we already offer both wellestablished technology and network solutions.
Performance marketing is about long-term relationships. Therefore, for our strategy to be successful, we need to adopt a long-term approach. We need to develop and execute welldevised plans in each of the three areas to get back on track. In terms of revenue growth, we see the company returning to a performance level in line with the market during the second half of 2013.
Our focus on developing a highly competitive performance marketing company will not hamper our efforts to drive our cost level down. On the contrary, we expect our operating costs, excluding depreciation, to be between SEK 35 M and SEK 39 M per month in 2013, down from a monthly average of over SEK 41 M, excluding change-related costs, during the first three quarters of 2012. This cost reduction drive is already underway, however, we expect additional changerelated costs in the fourth quarter of 2012 of approximately SEK 10 M.
I am in the process of building a new management team that will work with me to implement this strategy. This team will be in place during first quarter of 2013.
I look forward to sharing news about our revitalized business focus, control of costs and competitive drive in creating a newlook Tradedoubler over the coming months.
Rob Wilson President and CEO
The underlying markets for e-commerce and online advertising in Europe are growing by over 10 per cent per year, which is creating a good basis for growth in performance marketing. Larger volumes from individual customers and increasing market maturity are putting pressure on prices and margins, and consequently we expect the performance marketing segment to grow by a more modest 3-7 per cent per year over the next few years.
Performance marketing is estimated to have continued growing during the third quarter. Growth was stronger in Northern Europe than in Southern Europe, in line with the economic trend. Price pressure continued, particularly in Northern Europe. In more mature markets, such as the UK, competition for large customers was significant.
Companies that offer publishers different opportunities to earn money on their sites are becoming better and better at maintaining relationships with their counterparties. Userfriendly, automatic systems for connecting to e-traders' programmes, which allow for changes and monitoring of earnings, are becoming highly appreciated and are attracting website owners.
The strong interest in marketing via mobiles and Internet tablets continued. Tradedoubler conducted a survey focusing on how consumers use their smartphones. This showed that even today mobiles have a strong impact on purchasing behaviour. The most popular usage is investigating products on the mobile in order to make a purchase later via a mobile, computer, tablet or in a physical store. In addition, almost one third of those who own a smartphone download some form of voucher code using their phone every month.
During the year, Tradedoubler opened its platform so that affiliates can work with it in a simpler and more efficient way. The speed of product development has increased as a result and several new products have been launched on the platform.
A system for handling voucher codes was introduced during the second and the third quarters. Discount coupons or voucher codes are an effective way to encourage purchasing and have become very popular for getting consumers, who for example, investigate the selection of products and services via their mobiles, to actually purchase the product, either online or in a store. Over 4,000 different variants of voucher code have been created in the system, which in turn generated earnings equivalent to 8 per cent of gross profit in Affiliate during the third quarter.
Tradedoubler has also introduced a new communication system in order to simplify, automate and improve message handling for affiliates, as well as a product catalogue system that will improve data quality, accelerate import and export of data and boost the number of products that the system can handle.
Tradedoubler has also launched an app for its affiliates. The app provides a quick overview of an affiliate's cooperation with Tradedoubler and gives access to daily earnings statistics.
Consolidated net sales during the interim period amounted to SEK 1,740.0 M (1,911.2), a fall of 8 per cent adjusted for changes in exchange rates. Net sales during the third quarter amounted to SEK 526.1 M (653.9), a decline of 16 per cent adjusted for changes in exchange rates.
Gross profit during the interim period amounted to SEK 406.9 M (459.3), a fall of 10 per cent adjusted for changes in exchange rates. Gross profit during the quarter amounted to SEK 119.7 M (152.5), a fall of 17 per cent adjusted for changes in exchange rates.
Gross profit was adversely affected by a weak competitive position, changes in the group management and weak economies in Southern Europe.
Large customers that have worked with performance marketing for a long time have increasingly opted to manage affiliate relationships themselves, which also contributed to the weaker earnings. Tradedoubler offers such services and can thereby retain customers for a longer time even though this extension of the customer relationship is based on lower earnings.
Network decreased its gross profit during the quarter to SEK 105.3 M (138.1), a decline of 20 per cent adjusted for changes in exchange rates. Technology reported an unchanged gross profit of SEK 14.5 M (14.5), an increase of 6 per cent adjusted for changes in exchange rates.
Gross margin during the interim period decreased to 23.4 per cent from 24.0 per cent during the same period of last year. Gross margin was 22.8 per cent during the quarter, compared to 23.3 per cent during the same quarter of last year. Gross margin was negatively impacted by increasing competition from other players, both in display and in performance marketing.
Operating costs amounted to SEK 404.8 M (371.0) during the interim period. During the quarter, operating costs totalled SEK 127.5 M (121.3). Depreciation and amortisation accounted for SEK 13.1 M (14.6) of this during the interim period and SEK 4.6 M (3.5) during the quarter.
Change-related costs mainly consisted of personnel expenses and amounted to SEK 5.3 M during the quarter, which means that change-related costs during the interim period totalled approx. SEK 20 M. This was also reflected in higher administrative expenses.
Confirmed bad debt losses and provisions for doubtful accounts receivable amounted to SEK -7.5 M (-4.5) during the interim period and to SEK -2.8 M (-0.2) during the quarter.
Operating profit (EBIT) amounted to SEK 2.1 M (88.3) during the interim period. Operating profit during the third quarter was SEK -7.8 M (31.3) mainly due to the fact that the company did not manage to adjust its cost level in line with falling transaction volumes.
Financial income and expenses amounted to SEK 1.4 M (-11.8) during the interim period. During the quarter, financial income and expenses amounted to SEK 2.2 M (-5.0). The Group had no interest-bearing loans at the end of the quarter (0.0).
Profit after tax during the period amounted to SEK -11.3 M (53.9). During the third quarter, profit after tax was SEK -10.6 M (19.9). The tax expense amounted to SEK 14.8 M (22.6) during the interim period and to SEK 5.0 M (6.4) during the quarter. Of this expense, SEK 13.3 M during the interim period and SEK 7.3 M during the quarter related to adjustments in respect of previous years.
Gross profit during the third quarter amounted to SEK 105.3 M (138.1), a fall of 20 per cent adjusted for changes in exchange rates. The North West, Central, and South East market units accounted for the biggest declines.
Operating profit (EBIT) amounted to SEK -13.6 M (24.3). The Central, North East and North West market units accounted for most of the decline and for the biggest losses.
| MSEK | Jul-Sep | Jul-Sep | Jan-Sep | Jan-Sep | Full year |
|---|---|---|---|---|---|
| Gross profit (GP) | 2012 | 2011 | 2012 | 2011 | 2011 |
| Market Unit Central | 24.7 | 31.8 | 84.7 | 95.2 | 131.4 |
| Market Unit France | 19.9 | 22.7 | 64.0 | 73.5 | 99.7 |
| Market Unit North East | 26.6 | 31.4 | 86.8 | 93.6 | 127.8 |
| Market Unit North West | 16.7 | 27.3 | 64.9 | 81.8 | 112.4 |
| Market Unit South East | 9.1 | 15.0 | 35.2 | 47.0 | 63.1 |
| Market Unit South West | 8.3 | 9.8 | 25.7 | 28.1 | 36.3 |
| Total Network | 105.3 | 138.1 | 361.3 | 419.2 | 570.6 |
| Business Unit Technology | 14.5 | 14.5 | 45.6 | 40.1 | 55.9 |
| Total gross profit | 119.7 | 152.5 | 406.9 | 459.3 | 626.5 |
| Operating profit (EBIT) | |||||
| Market Unit Central | -4.2 | 4.3 | -6.3 | 13.7 | 19.7 |
| Market Unit France | 3.1 | 6.8 | 9.7 | 24.5 | 34.6 |
| Market Unit North East | -4.9 | 1.9 | -16.8 | 3.7 | 4.1 |
| Market Unit North West | -7.0 | 3.2 | -9.9 | 5.3 | 12.2 |
| Market Unit South East | -0.2 | 5.8 | 3.1 | 19.4 | 25.6 |
| Market Unit South West | -0.4 | 2.3 | 1.4 | 4.8 | 6.0 |
| Total Network | -13.6 | 24.3 | -18.8 | 71.3 | 102.2 |
| Business Unit Technology | 5.8 | 6.9 | 20.9 | 17.0 | 24.8 |
| Total EBIT | -7.8 | 31.3 | 2.1 | 88.3 | 127.1 |
| Operating profit/Gross profit, % | |||||
| Market Unit Central | neg | 13.6 | neg | 14.4 | 15.0 |
| Market Unit France | 15.7 | 30.1 | 15.1 | 33.3 | 34.7 |
| Market Unit North East | neg | 6.0 | neg | 3.9 | 3.2 |
| Market Unit North West | neg | 11.7 | neg | 6.4 | 10.9 |
| Market Unit South East | neg | 38.9 | 9.0 | 41.3 | 40.6 |
| Market Unit South West | neg | 23.1 | 5.3 | 17.1 | 16.6 |
| Business Unit Technology | 40.1 | 47.8 | 45.8 | 42.5 | 44.4 |
The Central market unit achieved a gross profit of SEK 24.7 M (31.8) during the quarter, a fall of 14 per cent adjusted for changes in exchange rates. Operating profit was SEK -4.2 M (4.3). Gross profit fell in the unit's three largest countries, Germany, Switzerland and the Netherlands.
France reported a gross profit of SEK 19.9 M (22.7) during the quarter, a decline of 4 per cent adjusted for changes in exchange rates. Operating profit amounted to SEK 3.1 M (6.8). For some time, the unit has been increasingly focusing its
efforts on affiliate. This has boosted sales but it takes time for this to be converted into revenue.
Gross profit in North East amounted to SEK 26.6 M (31.4) during the quarter, a fall of 11 per cent adjusted for changes in exchange rates. Operating profit was SEK -4.9 M (1.9). There is high turnover in the market unit's customer portfolio, which is having a negative impact on earnings, as it takes time for new customers to build up volumes.
The North West market unit reported a gross profit of SEK 16.7 M (27.3) during the quarter, a decline of 40 per cent adjusted for changes in exchange rates. Gross profit for the quarter was negatively impacted by SEK 3.6 M in Cost of Sales referring to previous periods. Operating profit was SEK -7.0 M (3.2). The intense competition persisted in the UK, which is the most mature market in Europe. The sales organisation was restructured in order to achieve a stronger focus.
The South East market unit achieved a gross profit of SEK 9.1 M (15.0) during the quarter, a fall of 33 per cent adjusted for changes in exchange rates. Operating profit was SEK -0.2 M (5.8). Larger media agencies are establishing their own networks for specific market niches, which implies lower transaction volumes for Tradedoubler. The unit has also lost some larger customers.
Gross profit in the South West market unit during the quarter amounted to SEK 8.3 M (9.8), a decline of 10 per cent adjusted for changes in exchange rates. Operating profit was SEK -0.4 M (2.3). Renegotiations and low activity in the travel sector, which is very important for the unit, had a negative impact on earnings.
Gross profit during the third quarter was unchanged at SEK 14.5 M (14.5). Operating profit (EBIT) amounted to SEK 5.8 M (6.9).
The business developed well generally. The operations in Southern Europe continued to grow during the quarter. The interest in Technology is increasing in line with customers' experience of online marketing.
Tradedoubler's operations, particularly within Network, fluctuate with the development of e-commerce and online advertising. Although these areas are showing positive underlying growth, there are fluctuations during the year particularly within e-commerce. The highest level of activity is before Christmas, which implies that the fourth quarter is normally the strongest for Tradedoubler.
The parent company's net sales amounted to SEK 95.5 M (144.4) during the interim period. Revenue primarily consisted of licensing revenue and remuneration from subsidiaries for centrally performed services.
Financial income and expenses amounted to SEK 5.0 M (16.5). Profit after tax amounted to SEK -18.4 M (32.4). The significantly lower profit, compared to the same period of the previous year, was mainly due to lower licensing revenue, which itself is a result of lower sales in subsidiaries.
The parent company's receivables from group companies amounted to SEK 111.6 M (159.1), at the end of the quarter, of which none (0.0) were non-current. The parent company's liabilities to group companies amounted to SEK 129.3 M (123.9), of which none (0.0) were non-current. Cash and cash equivalents amounted to SEK 26.2 M (36.4).
Cash flow from operating activities during the third quarter amounted to SEK 13.4 M (45.8), after a change in working capital of SEK 22.5 M (22.8). The negative effect on the cash flow due to falling volumes was moderated by a proportionally large decrease in accounts receivable. Cash flow from operating activities before changes in working capital amounted to SEK -9.1 M (22.9) during the quarter.
Net investments in intangible assets amounted to SEK 8.9 M (7.7). These mainly consisted of investments in production and business systems.
Cash flow for the interim period amounted to SEK -105.1 M (39.8), due to weak earnings in the interim period impacted by falling volumes, a negative working capital trend, a high investment rate and dividend paid to the company's shareholders. Cash and cash equivalents amounted to SEK 173.3 M (261.6) at the end of the quarter. The Group had no interestbearing loans (0.0) on the balance sheet date.
Consolidated shareholders' equity amounted to SEK 497.7 M (592.7) at end of the quarter. For the latest 12-month period, the return on equity amounted to 4.9 (13.8) per cent.
At the end of the quarter, Tradedoubler's staff corresponded to 489 (553) full-time equivalents (FTEs), which includes full-time, temporary and contract employees. The number of full-time equivalents decreased by 60 due to the discontinuation of Search and outsourcing of parts of the IT operations in December 2011.
Tradedoubler's share is listed on NASDAQ OMX Stockholm's list for medium-sized companies (Mid Cap) in the Media sector. The share is traded under the ticker TRAD.
The total number of shares at the end of the interim period was 42,807,449, of which 130,000 were in own custody. The average number of outstanding shares during the interim period was 42,677,449.
Earnings per share amounted to SEK -0.25 (0.47) during the third quarter and to SEK -0.26 (1.26) during the first nine months of the year. Equity per share amounted to SEK 11.70 (13.90) at the end of the quarter.
The share price closed at SEK 14.00 on the final trading day of September 2012, which was lower than at the end of September 2011 when the share price was SEK 23.00. At year-end, the share price closed at SEK 27.30.
Aside from remuneration to the Board and senior executives, no transactions between Tradedoubler and related parties impacting the company's financial position and results have taken place.
Tradedoubler divides risks into market-related risks, operational risks, financial risks and legal risks. These risks are described on pages 15-17 of the 2011 Annual Report.
Tradedoubler has a deferred tax receivable of SEK 14 M attributable to a previous intra-group loan. The receivable has arisen by virtue of the fact that right to deduction of interest expenses related to the loan was denied in the subsidiary. Therefore an application of repayment of previously paid tax on interest income will be initiated for the parent company. The company expects that it will be able to recover the full amount although there is always a risk in this type of case.
Apart from the above-mentioned tax receivable, no significant risks or uncertainties are considered to have arisen after the latest published Annual Report, other than greater uncertainty about the future economic and market trend in Europe and increased customer credit risks as a result of this.
Rob Wilson was appointed new President and CEO to succeed Urban Gillström. Rob Wilson was most recently head of the North West market unit. Jonas Ragnarsson took over as new CFO after Erik Skånsberg. Both managerial changes took effect on 1 August 2012.
The decision was made to abolish the role of CCO (Chief Commercial Officer) with responsibility for marketing and sales. Elaine Safier left from the company as a consequence of this.
The market for performance marketing is expected to continue to show growth during 2013. The company is expected to return to growth in line with the market during the second half of next year.
Product development, customer relationships and the organisation are directed at strengthening the Group's position in the core business Affiliate, performance marketing.
Operating costs before depreciation and amortisation are expected to be in the range of SEK 35-39 M per month during 2013.
Change-related costs are expected to amount to approx. SEK 10 M during the fourth quarter of 2012.
No significant events have occurred after the end of the reporting period.
The annual general meeting 2013 will be held on 7 May 2013 in Tradedoubler's premises at Sveavägen 20 in Stockholm.
In accordance with the resolution of the annual general meeting 2012, a Nomination Committee has been appointed consisting of representatives of the three largest shareholders at the end of August as well as the Chairman of the Board. The owner representatives are Johan Strandberg representing SEB, (Chairman of the Nomination Committee), Ramsay Brufer representing Alecta and Mats Andersson representing Fjärde APfonden.
Shareholders wishing to present proposals to the Nomination Committee for the 2013 Annual General Meeting can, at the latest the 27th of March 2013, submit them to the Nomination Committee's secretary Carol Spendilow (TradeDoubler's General Counsel) by post: TradeDoubler AB, Att: Carol Spendilow, Sveavägen 20, 111 57 Stockholm, Sweden, or by e-mail: [email protected].
Information about the work of the nomination committee may be found on Tradedoubler's home page www.tradedoubler.com.
This interim report is prepared in accordance with IAS 34, Interim Financial Reporting and the Swedish Annual Accounts Act. From and including the interim report for the period January-June 2012, the key ratio 'equity per share' is calculated on the basis of equity on the balance sheet date. In interim reports prior to this and in the 2011 Annual Report, the key ratio was calculated on the basis of the average equity for the interim period. Other accounting policies and calculation methods applied are unchanged compared with the 2011 Annual Report.
For information on the accounting policies applied, see the 2011 Annual Report.
This interim report will be presented at a press and analyst conference on 31 October 2012 at 11.00 a.m. in Tradedoubler's premises at Sveavägen 20, Stockholm. The presentation may be followed via a webcast on the website:
http://financials.tradedoubler.com/investorrelations, and by telephone:
| Sweden | +46 8 5055 9843 |
|---|---|
| UK | +44 207750 9950 |
| US | +1 866 6765869 |
The presentation material will be published concurrently with the interim report.
Year-end report 2012 6 February 2013 Interim report January-March 2013 3 May 2013 Interim report January-June 2013 26 July 2013 Interim report January-September 2013 30 October 2013 Year-end report 2013 6 February 2014
The capital markets day that was announced for the autumn of 2012 will take place during 2013.
Rob Wilson, President and CEO, telephone +44 (0) 7500 667 587 Jonas Ragnarsson, CFO, telephone +46 8 405 08 00 E-mail: [email protected]
Both an English version and a Swedish version of this report have been prepared. In the event of a difference between the two reports, the Swedish version shall prevail.
This interim report has been reviewed by the company's auditor Ernst & Young AB.
Stockholm, 31 October 2012
Rob Wilson President and CEO
| Jul-Sep | Jul-Sep | Jan-Sep | Jan-Sep | Full year | |
|---|---|---|---|---|---|
| SEK 000s | 2012 | 2011 | 2012 | 2011 | 2011 |
| Net Sales | 526,115 | 653,926 | 1,739,981 | 1,911,247 | 2,612,701 |
| Cost of goods sold | -406,399 | -501,386 | -1,333,089 | -1,451,950 | -1,986,163 |
| Gross profit | 119,715 | 152,540 | 406,892 | 459,297 | 626,539 |
| Selling expenses | -80,225 | -82,027 | -257,011 | -247,322 | -335,928 |
| Administrative expenses | -37,009 | -31,040 | -118,811 | -94,474 | -120,840 |
| Development expenses | -10,242 | -8,213 | -28,944 | -29,178 | -42,711 |
| Operating profit | -7,760 | 31,260 | 2,125 | 88,323 | 127,060 |
| Net financial items | 2,223 | -4,970 | 1,409 | -11,805 | -12,693 |
| Profit before tax | -5,537 | 26,290 | 3,533 | 76,518 | 114,367 |
| Tax | -5,041 | -6,369 | -14,840 | -22,606 | -22,201 |
| Net profit for continued operations | -10,577 | 19,921 | -11,307 | 53,912 | 92,166 |
| Net profit for discontinued operations | - | 564 | - | 5,560 | -143,069 |
| Total net profit for continued and discontinued operations | -10,577 | 20,485 | -11,307 | 59,472 | -50,904 |
All earnings accrue to the parent company's shareholders.
| Jul-Sep | Jul-Sep | Jan-Sep | Jan-Sep | Full year | |
|---|---|---|---|---|---|
| SEK 000s | 2012 | 2011 | 2012 | 2011 | 2011 |
| Profit for the period, after tax | -10,577 | 20,485 | -11,307 | 59,472 | -50,904 |
| Other comprehensive income | |||||
| Translation difference, net after tax | -14,017 | 20,014 | -7,786 | 24,540 | 21,060 |
| Exchange difference on increased net investment, net after tax* | - | 1,046 | - | -8,130 | -8,130 |
| Reversal of exchange difference on increased net investment, net | |||||
| after tax* | - | - | - | - | 98,077 |
| Reversal of translation difference, net after tax* | - | - | - | - | 3,765 |
| Total comprehensive income for the period, after tax | -24,595 | 41,546 | -19,093 | 75,883 | 63,868 |
| Comprehensive income attributable to: | |||||
| Parent company shareholders | -24,595 | 41,546 | -19,093 | 75,883 | 63,868 |
* These items are related to discontinued operations.
| Jul-Sep | Jul-Sep | Jan-Sep | Jan-Sep | Full year | |
|---|---|---|---|---|---|
| SEK | 2012 | 2011 | 2012 | 2011 | 2011 |
| Profit per share for continued operations | -0.25 | 0.47 | -0.26 | 1.26 | 2.16 |
| Total profit per share (including discontinued operations) | -0.25 | 0.48 | -0.26 | 1.39 | -1.19 |
| Number of Shares | |||||
| Weighted average | 42,677,449 | 42,677,449 | 42,677,449 | 42,677,449 | 42,677,449 |
The earnings per share above apply before and after dilution.
| Jul-Sep | Jul-Sep | Jan-Sep | Jan-Sep | Full year | |
|---|---|---|---|---|---|
| 2012 | 2011 | 2012 | 2011 | 2011 | |
| Gross profit (GP) / revenue (%) | 22.8 | 23.3 | 23.4 | 24.0 | 24.0 |
| Operating profit (EBIT ) / revenue (%) | -1.5 | 4.8 | 0.1 | 4.6 | 4.9 |
| Operating profit (EBIT) / gross profit (GP) (%) | -6.5 | 20.5 | 0.5 | 19.2 | 20.3 |
| Net profit/gross profit (GP) (%) | -8.8 | 13.1 | -2.8 | 11.7 | 14.7 |
| Equity/assets ratio (%) | 41.4 | 40.7 | 41.4 | 40.7 | 40.4 |
| Return on equity (12 months) (%) | 4.9 | 13.8 | 4.9 | 13.8 | 16.8 |
| Average number of employees | 489 | 553 | 490 | 546 | 544 |
| Return on Capital Employed (12 months) (%) | 7.9 | 22.4 | 7.9 | 22.4 | 23.4 |
| Cash-flow per share, SEK | 0.1 | 0.9 | -2.5 | 0.8 | 1.7 |
| Equity per share, SEK | 11.7 | 13.9 | 11.7 | 13.9 | 13.6 |
| Stock price at the end of the period, SEK | 14.0 | 23.0 | 14.0 | 23.0 | 27.3 |
| 30 Sep | 30 Sep | 31 Dec | |
|---|---|---|---|
| SEK 000s | 2012 | 2011 | 2011 |
| Assets | |||
| Intangible fixed assets | 423,595 | 428,644 | 404,054 |
| Tangible fixed assets | 9,984 | 14,814 | 10,968 |
| Financial fixed assets | 3,611 | 2,757 | 3,549 |
| Deferred tax assets | 37,725 | 30,284 | 21,111 |
| Total fixed assets | 474,914 | 476,498 | 439,683 |
| Accounts receivables | 518,326 | 613,599 | 642,432 |
| Tax assets | 7,111 | 40,949 | 28,632 |
| Other current receivables | 28,110 | 62,911 | 35,149 |
| Cash & cash equivalents | 173,288 | 261,636 | 290,745 |
| Total current assets | 726,835 | 979,095 | 996,957 |
| Total assets | 1,201,749 | 1,455,593 | 1,436,640 |
| Shareholders' equity and liabilities | |||
| Shareholders' equity | 497,734 | 592,667 | 580,843 |
| Deferred tax liabilities | 6,752 | 9,606 | 7,625 |
| Other provisions | 990 | 1,079 | 1,044 |
| Total long-term liabilities | 7,743 | 10,685 | 8,669 |
| Accounts payable | 16,740 | 29,124 | 29,407 |
| Current liabilities to publishers | 423,693 | 459,447 | 498,346 |
| Tax liabilities | 9,427 | 16,829 | 9,251 |
| Other current liabilities | 246,411 | 346,841 | 310,124 |
| Total current liabilities | 696,272 | 852,241 | 847,128 |
| Total shareholder´s equity and liabilities | 1,201,749 | 1,455,593 | 1,436,640 |
| Jul-Sep | Jul-Sep | Jan-Sep | Jan-Sep | Full year | |
|---|---|---|---|---|---|
| SEK 000s | 2012 | 2011 | 2012 | 2011 | 2011 |
| Opening balance | 522,329 | 551,122 | 580,843 | 516,784 | 516,784 |
| Total comprehensive income for the period, continued operations | -24,595 | 38,069 | -19,093 | 78,027 | 112,914 |
| Total comprehensive income for the period, discontinued | - | 3,476 | - | -2,144 | -49,046 |
| operations* | |||||
| Equity-settled share-based payments | - | - | - | - | 191 |
| Dividend | - | - | -64,016 | - | - |
| Closing balance | 497,734 | 592,667 | 497,734 | 592,667 | 580,843 |
All capital accrues to the parent company's shareholders.
* See disclosure regarding discontinued operations, page 18.
| Jul-Sep | Jul-Sep | Jan-Sep | Jan-Sep | Full year | |
|---|---|---|---|---|---|
| SEK 000s | 2012 | 2011 | 2012 | 2011 | 2011 |
| Operating activities | |||||
| Profit before tax | -5,537 | 26,289 | 3,533 | 76,517 | 114,367 |
| Adjustments for items not included in cash flow | 3,815 | 4,675 | 26,957 | 21,572 | 16,098 |
| Income taxes paid | -7,355 | -8,020 | -10,725 | -22,746 | -14,463 |
| Cash flow from operating activities before changes in working | |||||
| capital | -9,077 | 22,944 | 19,765 | 75,343 | 116,002 |
| Changes in working capital | 22,515 | 22,820 | -28,110 | -19,638 | 7,626 |
| Cash flow from operating activities | 13,438 | 45,764 | -8,345 | 55,705 | 123,628 |
| Investing activities | |||||
| Net investments in intangible assets | -8,912 | -7,657 | -29,295 | -16,025 | -25,828 |
| Net investments in tangible assets | -1,690 | -1,942 | -3,175 | -5,236 | -3,877 |
| Net investments in financial assets | -27 | 196 | -251 | -520 | -1,394 |
| Net investments in stocks and subsidiaries | - | - | - | - | -24,421 |
| Cash flow from investing activities | -10,629 | -9,403 | -32,721 | -21,781 | -55,520 |
| Financing activities | |||||
| Dividend paid to parent company's shareholders | - | - | -64,016 | - | - |
| Cash flow from financing activities | - | - | -64,016 | - | - |
| Cash flow for the period from continuing operations | 2,809 | 36,361 | -105,082 | 33,924 | 68,108 |
| Cash flow from discontinued operations | |||||
| Cash flow from operating activities | - | 3,362 | - | 5,910 | 3,903 |
| Cash flow from investing activities | - | - | - | - | -51 |
| Cash flow from financing activities | - | - | - | - | - |
| Cash flow for the period from discontinued operations | - | 3,362 | - | 5,910 | 3,852 |
| Cash flow for the period | 2,809 | 39,723 | -105,082 | 39,834 | 71,960 |
| Cash and cash equivalents | |||||
| On the opening date | 179,352 | 214,260 | 290,745 | 209,744 | 209,744 |
| Translation difference in cash and cash equivalents | -8,873 | 7,653 | -12,375 | 12,058 | 9,041 |
| Cash and cash equivalens on the closing date | 173,288 | 261,636 | 173,288 | 261,636 | 290,745 |
| Adjustments for non-cash items | |||||
| Depreciation | 4,002 | 3,932 | 11,258 | 12,840 | 16,776 |
| Other | -187 | 743 | 15,699 | 8,732 | -678 |
| Total non-cash items | 3,815 | 4,675 | 26,957 | 21,572 | 16,098 |
* Attributable to discontinued operations.
| Jul-Sep | Jul-Sep | Jan-Sep | Jan-Sep | Full year | |
|---|---|---|---|---|---|
| SEK 000s | 2012 | 2011 | 2012 | 2011 | 2011 |
| Net Sales | 18,319 | 51,788 | 95,487 | 144,364 | 193,554 |
| Cost of goods sold | -2,291 | -2,040 | -6,074 | -5,826 | -7,931 |
| Gross profit | 16,028 | 49,749 | 89,413 | 138,538 | 185,623 |
| Selling expenses | -430 | -1,252 | -2,295 | -5,230 | -6,010 |
| Administrative expenses | -29,496 | -26,017 | -108,480 | -90,843 | -119,216 |
| Development expenses | -6,823 | -7,388 | -20,875 | -23,739 | -32,140 |
| Operating profit | -20,721 | 15,093 | -42,238 | 18,725 | 28,257 |
| Net financial items | 2,629 | -3,293 | 5,018 | 16,458 | -363,513 |
| Profit before tax | -18,092 | 11,800 | -37,221 | 35,183 | -335,256 |
| Tax | 9,884 | -1,344 | 18,858 | -2,771 | -113 |
| Net profit | -8,208 | 10,456 | -18,363 | 32,411 | -335,369 |
| 30 Sep | 30 Sep | 31 Dec | |
|---|---|---|---|
| SEK 000s | 2012 | 2011 | 2011 |
| Assets | |||
| Intangible fixed assets | 50,151 | 17,929 | 26,601 |
| Fixed tangible assets | 4,137 | 9,239 | 5,520 |
| Financial fixed assets | 207,323 | 545,327 | 206,327 |
| Deffered tax assets | 24,215 | - | - |
| Total fixed assets | 285,825 | 572,495 | 238,449 |
| Accounts receivables | 3,012 | 2,625 | 6,339 |
| Receivables from Group companies | 111,608 | 159,139 | 157,307 |
| Tax assets | 3,731 | 20,438 | 7,191 |
| Other current receivables | 7,873 | 10,091 | 11,100 |
| Cash & cash equivalents | 26,221 | 36,432 | 52,224 |
| Total current assets | 152,444 | 228,724 | 234,161 |
| Total assets | 438,270 | 801,220 | 472,610 |
| Shareholders' equity and liabilities | |||
| Shareholders equity | 191,818 | 543,710 | 274,198 |
| Accounts payable | 11,481 | 13,355 | 10,299 |
| Liabilities to Group companies | 129,289 | 123,919 | 71,119 |
| Other liabilities | 105,681 | 120,236 | 116,994 |
| Total current liabilities | 246,451 | 257,510 | 198,412 |
| Total shareholder´s equity and liabilities | 438,270 | 801,220 | 472,610 |
| 30 Sep | 30 Sep | 31 Dec | |
|---|---|---|---|
| SEK 000s | 2012 | 2011 | 2011 |
| Group | |||
| Pledged assets | none | none | none |
| Rent deposits | 3,611 | 2,754 | 3,549 |
| Contingent liabilities | none | none | none |
| Parent company | |||
| Pledged assets | none | none | none |
| Contingent liabilities | 5,523 | 5,769 | 6,939 |
| Jul-Sep | Apr-Jun | Jan-Mar | Oct-Dec | Jul-Sep | Apr-Jun | Jan-Mar | Oct-Dec | |
|---|---|---|---|---|---|---|---|---|
| SEK 000s | 2012 | 2012 | 2012 | 2011 | 2011 | 2011 | 2011 | 2010 |
| Net Sales | 526,115 | 573,660 | 640,206 | 701,455 | 653,926 | 604,760 | 652,561 | 679,448 |
| Cost of goods sold | -406,399 | -432,873 | -493,816 | -534,213 | -501,386 | -455,283 | -495,280 | -506,877 |
| Gross profit | 119,715 | 140,786 | 146,390 | 167,241 | 152,540 | 149,477 | 157,281 | 172,571 |
| Total costs | -127,475 | -143,549 | -133,742 | -128,505 | -121,280 | -127,239 | -122,455 | -138,816 |
| Operating profit | -7,760 | -2,763 | 12,648 | 38,737 | 31,260 | 22,237 | 34,826 | 33,755 |
| Net financial items | 2,223 | -1,088 | 273 | -888 | -4,970 | 2,094 | -8,929 | -4,133 |
| Profit before tax | -5,537 | -3,851 | 12,921 | 37,849 | 26,290 | 24,331 | 25,897 | 29,622 |
| Tax | -5,041 | -6,988 | -2,811 | 405 | -6,369 | -10,352 | -5,886 | -8,166 |
| Net profit | -10,577 | -10,839 | 10,109 | 38,254 | 19,921 | 13,979 | 20,012 | 21,455 |
| 30 Sep | 30 Jun | 31 Mar | 31 Dec | 30 Sep | 30 Jun | 31 Mar | 31 Dec | |
|---|---|---|---|---|---|---|---|---|
| SEK 000s | 2012 | 2012 | 2012 | 2011 | 2011 | 2011 | 2011 | 2010 |
| Assets | ||||||||
| Intangible fixed assets | 423,595 | 427,356 | 406,048 | 404,054 | 428,644 | 405,883 | 406,738 | 423,123 |
| Other fixed assets | 51,320 | 42,277 | 38,581 | 35,629 | 47,854 | 47,527 | 45,560 | 45,654 |
| Current receivables | 553,547 | 622,317 | 668,812 | 706,213 | 717,459 | 681,006 | 691,012 | 737,204 |
| Cash & cash equivalents | 173,288 | 179,352 | 268,222 | 290,745 | 261,636 | 214,260 | 245,633 | 209,744 |
| Total assets | 1,201,749 | 1,271,302 | 1,381,663 | 1,436,640 | 1,455,593 | 1,348,676 | 1,388,944 | 1,415,725 |
| Shareholders' equity and liabilities | ||||||||
| Shareholders' equity | 497,734 | 522,329 | 587,636 | 580,843 | 592,667 | 551,122 | 530,870 | 516,784 |
| Long-term non-interest bearing debt | 7,743 | 8,479 | 8,576 | 8,669 | 10,685 | 11,420 | 12,199 | 18,926 |
| Current non-interest bearing debt | 696,272 | 740,494 | 785,451 | 847,128 | 852,241 | 786,134 | 845,875 | 880,015 |
| Total shareholder´s equity and | ||||||||
| liabilities | 1,201,749 | 1,271,302 | 1,381,663 | 1,436,640 | 1,455,593 | 1,348,676 | 1,388,944 | 1,415,725 |
| Jul-Sep | Apr-Jun | Jan-Mar | Oct-Dec | Jul-Sep | Apr-Jun | Jan-Mar | Oct-Dec | |
|---|---|---|---|---|---|---|---|---|
| SEK 000s | 2012 | 2012 | 2012 | 2011 | 2011 | 2011 | 2011 | 2010 |
| Operating activities | ||||||||
| Profit before tax | -5,537 | -3,851 | 12,921 | 37,849 | 26,289 | 24,331 | 25,897 | 29,610 |
| Adjustments for items not included in | ||||||||
| cash flow | 3,815 | 21,373 | 1,769 | -5,473 | 4,675 | 8,789 | 8,108 | 5,481 |
| Tax paid | -7,355 | -291 | -3,079 | 8,283 | -8,020 | -11,174 | -3,552 | 24,925 |
| Cash flow from changes in working capital |
22,515 | -29,978 | -20,648 | 27,263 | 22,821 | -53,804 | 11,346 | 16,003 |
| Cash flow from operating activities | 13,438 | -12,747 | -9,037 | 67,922 | 45,765 | -31,858 | 41,799 | 76,019 |
| Cash flow from investing activities | -10,629 | -9,596 | -12,496 | -33,739 | -9,403 | -7,944 | -4,434 | -3,477 |
| Cash flow from financing activities | - | -64,016 | - | - | - | - | - | - |
| Cash flow from continued | ||||||||
| operations | 2,809 | -86,359 | -21,533 | 34,183 | 36,362 | -39,802 | 37,365 | 72,542 |
| Cash flow from discontinued | - | - | - | -2,058 | 3,362 | 1,115 | 1,433 | 1,543 |
| operations | ||||||||
| Cash flow for the period | 2,809 | -86,359 | -21,533 | 32,125 | 39,724 | -38,687 | 38,798 | 74,085 |
| Cash and cash equivalents | ||||||||
| On the opening date | 179,352 | 268,222 | 290,745 | 261,636 | 214,260 | 245,633 | 209,744 | 136,212 |
| Translation difference | -8,873 | -2,511 | -990 | -3,016 | 7,653 | 7,314 | -2,909 | -553 |
| Cash and cash equivalens on the | 173,288 | 179,352 | 268,222 | 290,745 | 261,636 | 214,260 | 245,633 | 209,744 |
| closing date |
| Jul-Sep | Apr-Jun | Jan-Mar | Oct-Dec | Jul-Sep | Apr-Jun | Jan-Mar | Oct-Dec | |
|---|---|---|---|---|---|---|---|---|
| 2012 | 2012 | 2012 | 2011 | 2011 | 2011 | 2011 | 2010 | |
| Gross profit (GP) / revenue (%) | 22.8 | 24.5 | 22.9 | 23.8 | 23.3 | 24.7 | 24.1 | 25.4 |
| Operating profit (EBIT ) / revenue (%) | -1.5 | -0.5 | 2.0 | 5.5 | 4.8 | 3.7 | 5.3 | 5.0 |
| Operating profit (EBIT) / gross profit (GP) (%) |
-6.5 | -2.0 | 8.6 | 23.2 | 20.5 | 14.9 | 22.1 | 19.6 |
| Net profit/gross profit (GP) (%) | -8.8 | -7.7 | 6.9 | 22.9 | 13.1 | 9.4 | 12.7 | 12.4 |
| Equity/assets ratio (%) | 41.4 | 41.1 | 42.5 | 40.4 | 40.7 | 40.9 | 38.2 | 36.5 |
| Return on equity (12 months) (%) | 4.9 | 10.7 | 14.7 | 16.8 | 13.8 | 13.0 | 16.5 | 14.6 |
| Average number of employees | 489 | 487 | 493 | 536 | 553 | 541 | 545 | 534 |
| Return on Capital Employed (12 months) (%) |
7.9 | 15.2 | 19.0 | 23.4 | 22.4 | 22.1 | 21.4 | 18.8 |
| Cash-flow per share, SEK | 0.1 | -2.0 | -0.5 | 0.8 | 0.9 | -0.9 | 0.9 | 1.7 |
| Equity per share, SEK | 11.7 | 12.2 | 13.8 | 13.6 | 13.9 | 12.9 | 12.4 | 12.1 |
| Stock price at the end of the period, SEK |
14.0 | 16.9 | 31.1 | 27.3 | 23.0 | 40.5 | 46.8 | 49.5 |
| Jul-Sep | Apr-Jun | Jan-Mar | Oct-Dec | Jul-Sep | Apr-Jun | Jan-Mar | Oct-Dec | |
|---|---|---|---|---|---|---|---|---|
| MSEK | 2012 | 2012 | 2012 | 2011 | 2011 | 2011 | 2011 | 2010 |
| Market Unit Central | ||||||||
| Gross profit | 24.7 | 28.4 | 31.5 | 36.2 | 31.8 | 31.2 | 32.3 | 35.7 |
| Operating profit | -4.2 | -3.5 | 1.4 | 6.0 | 4.3 | 4.1 | 5.3 | 4.8 |
| Market Unit France | ||||||||
| Gross profit | 19.9 | 20.6 | 23.5 | 26.1 | 22.7 | 22.9 | 27.9 | 30.1 |
| Operating profit | 3.1 | 1.1 | 5.4 | 10.2 | 6.8 | 6.0 | 11.6 | 8.0 |
| Market Unit North East | ||||||||
| Gross profit | 26.6 | 30.3 | 30.0 | 34.3 | 31.4 | 30.6 | 31.5 | 36.0 |
| Operating profit | -4.9 | -5.9 | -6.0 | 0.4 | 1.9 | 0.3 | 1.5 | 3.2 |
| Market Unit North West | ||||||||
| Gross profit | 16.7 | 22.1 | 26.0 | 30.6 | 27.3 | 26.3 | 28.2 | 29.9 |
| Operating profit | -7.0 | -4.3 | 1.4 | 7.0 | 3.2 | -0.1 | 2.2 | 6.1 |
| Market Unit South East | ||||||||
| Gross profit | 9.1 | 13.5 | 12.5 | 16.0 | 15.0 | 15.5 | 16.6 | 15.5 |
| Operating profit | -0.2 | 1.5 | 1.8 | 6.2 | 5.8 | 6.1 | 7.5 | 4.0 |
| Market Unit South West | ||||||||
| Gross profit | 8.3 | 8.9 | 8.6 | 8.1 | 9.8 | 9.3 | 9.0 | 10.9 |
| Operating profit | -0.4 | 0.9 | 0.9 | 1.2 | 2.3 | 1.3 | 1.3 | 1.2 |
| Technology | ||||||||
| Gross profit | 14.5 | 17.0 | 14.3 | 15.9 | 14.5 | 13.7 | 11.9 | 14.4 |
| Operating profit | 5.8 | 7.5 | 7.6 | 7.8 | 6.9 | 4.6 | 5.5 | 6.5 |
| Total | ||||||||
| Gross profit | 119.7 | 140.8 | 146.4 | 167.2 | 152.5 | 149.5 | 157.3 | 172.6 |
| Operating profit (EBIT) | -7.8 | -2.8 | 12.6 | 38.7 | 31.3 | 22.2 | 34.8 | 33.8 |
| Jul-Sep | Jan-Sep | Full year | |
|---|---|---|---|
| SEK 000s | 2011 | 2011 | 2011 |
| Net Sales | 82,051 | 268,542 | 343,990 |
| Cost of goods sold | -74,581 | -243,971 | -312,178 |
| Gross profit | 7,470 | 24,571 | 31,812 |
| Total costs | -8,902 | -29,316 | -39,536 |
| Operating profit | -1,432 | -4,745 | -7,724 |
| Net financial items | 1,964 | 2,175 | 270 |
| Profit before tax | 532 | -2,569 | -7,454 |
| Tax | 33 | 8,130 | 11,272 |
| Net profit excl capital loss for the year for discontinuing operations | 564 | 5,560 | 3,818 |
| Capital loss | - | - | -146,887 |
| Net profit for the year for discontinuing operations | 564 | 5,560 | -143,069 |
| Other comprehensive income | |||
| Net profit from discontinued operations | 564 | 5,560 | -143,069 |
| Translation difference on equity net after tax | 1,866 | 426 | 311 |
| Exchange difference on increased net investment, net after tax | 1,046 | -8,130 | -8,130 |
| Reversal of exchange difference on increased net investment, net after tax | - | - | 98,077 |
| Reversal of translation difference on equity, net after tax | - | - | 3,765 |
| Total other comprehensive income from discontinued operations | 3,476 | -2,145 | -49,046 |
Discontinued operations refers to the operations in the Search market unit, which were transferred to Netbooster during the fourth quarter of 2011.
Return on equity. Net profit for the interim period as a percentage of average equity calculated as opening plus closing equity divided by two.
Return on capital employed. Operating profit plus interest income as a percentage of average capital employed calculated as opening plus closing capital employed divided by two.
Equity per share. Equity divided by the number of outstanding shares on the balance sheet date.
Earnings per share. Net profit for the year attributable to the parent company's shareholders divided by the average number of shares.
Earnings per share after full dilution. Net profit/loss for the year divided by the average number of shares calculated after full dilution.
Cash flow per share. Cash flow divided by the average number of outstanding shares.
Operating margin. Operating profit as a percentage of sales.
Equity/assets ratio. Equity as a percentage of the balance sheet total.
Capital employed. Total assets less current and non-current non interest-bearing liabilities including deferred tax liabilities.
AdCode. An ad display system which is used in order to optimise and display the best ad on a publisher's website.
Affiliate. Used for a website which via adverts directs Internet visitor traffic to the advertising company's website.
Affiliate network. A system where advertisers that want to boost their Internet sales are matched together with website owners that want to boost their advertising revenue by means of an affiliate programme.
Affiliate programme. An agreement where the advertiser pays a fee to the publisher in order to relay traffic to the advertiser's website.
App download tracking. Software that enables the advertiser to monitor and obtain statistics about when the consumer downloads and installs software from the advertiser and how the consumer uses the software afterwards.
Cost-per-action (CPA).Cost-per-action (CPA). Means that the advertisers pay a fee which either is based on the sales
generated by the advertising or on the number of leads (principally registrations) generated by the advert.
Cost-per-click (CPC).This pricing model means that advertisers pay a fee based on the number of clicks or unique visitors generated by the advertising.
Cost-per-lead (CPL).Means that the advertisers pay a fee which is based on the number of leads (primarily registrations) generated by the advert.
Cost-per-thousand impressions (CPM). A pricing model where advertisers pay a fee based on the number of views of an advert.
E-mail publishers. Use e-mail to send out targeted offers to a list of recipients.
Full-time equivalents (FTE) or full-time employees. The total number of full-time and temporary as well as contract employees.
Performance-based. Collective term for marketing activities on the Internet where publishers only get paid when a predetermined transaction is generated.
Product feed. A distribution system where advertisers can upload their product databases in order to enable publishers to create content and ads on their websites.
Publisher. (Also called affiliate) Websites that agree on display of adverts and direct Internet visitor traffic to the advertising company's website.
Trackability. The process and method for follow-up of website traffic, primarily through use of cookies.
Portals. Websites which act as a gateway to the Internet and offer broad content and large volumes of traffic. On the portal, there are several links, a search engine and other services, for instance, free e-mail or filters and blocking possibilities.
Search engine optimizing publishers. Own websites which use search engines, e.g. Google and Yahoo!, in combination with their own knowledge about the search engine and the advertiser in order to display the advertiser high up in the search results list. These publishers help to generate greater volumes.
Voucher code. Voucher codes that are created and easily distributed to consumers via a publisher's website. The consumer can then use the voucher code when purchasing a product/service from the advertiser.
Tradedoubler creates results by improving the clients' digital marketing. This happens through our performance-based advertising network and our tools and services which help advertisers to make the most of their campaigns.
Tradedoubler operates on the growing and dynamic market for Internet marketing. The measured results are crucial in this market for determining how campaigns are designed and how advertising rates are set. Digital marketing now has a greater reach than TV advertising in the case of many countries and target groups.
Tradedoubler has operations in 18 countries. The core business is to arrange adverts between advertisers and websites. This mainly takes place through Tradedoubler's affiliate network which consists of 2,000 advertisers and 140,000 active publishers.
The core business is conducted in the segment Network which accounts for 90 per cent of the group's gross profit. The Technology unit licenses Tradedoubler's technology platform for Internet marketing to major advertisers.
Tradedoubler's business model is based on the company:
The basis of the operations is that Tradedoubler arranges and optimises ads and campaign space between advertisers and publishers of websites. Through its knowledge of Internet marketing, technology platforms for handling transactions and tracking visitors, advanced administrative system and affiliate network, Tradedoubler improves business for both advertisers and publishers. Tradedoubler is able to receive payment in relation to the result generated since the outcome is clearly measurable.
A large portion of Tradedoubler's revenue is performancebased. Remuneration from advertisers to publishers – and to Tradedoubler – is only payable when the visitor performs a certain activity, such as clicking on an ad or executing a purchase.
The activities which determine the remuneration are CPM (costper-thousands impressions), CPC (cost-per-click), CPL (cost-perlead) and CPA (cost-per-action). Which one or combination of these activities forms the basis for the remuneration is decided on a case-by-case-basis. CPA and CPC are the most common. Tradedoubler's system tracks the customer activities generated by a certain advert in order to calculate the remuneration.
Tradedoubler discloses the information provided herein pursuant to the Swedish Securities Markets Act. The information was released for publication on 31 October 2012 at 8.00 a.m. CET.
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