Phorm Corporation Limited ("Phorm" or the "Company)
Operational Update
Phorm (AIM: PHRM), a leading internet personalisation technology company, announces an unaudited operational and financial update showing further strong growth in the group's revenues and key performance indicators ("KPIs").
RUSSIA
Key Performance Indicator
2014 Q3
2014 Q4
2015 Q1
2015 Q2
Average of daily unique users (m)
12.5
23.9
31.5
35.5
Total advertising requests (m)
16,625.3
25,437.3
40,343.5
83,018.9
Total advertisements served (m)
126.9
295.5
342.0
393.3
Total revenues (m RUB)
2.0
9.8
15.7
29.0
The three core components of the Company's business model are users, inventory (advertising requests) and advertising campaigns (advertisements served). These components are put in place sequentially in order to generate revenue.
In terms of users in Russia, the Company is delighted to announce that the average daily unique user numbers has grown from 12.5 million in Q3 2014 to 35.5 million in Q2 2015. These figures serve to demonstrate the scale of the opportunity available to the Company.
The number of advertising requests to which the Company has access in Russia has also increased significantly. The number of requests has more than doubled from 40.3 billion in Q1 2015 to 83.1 billion Q2 2015. Phorm now has publishing deals in place with some of the largest players in the market and the Company expects this to continue to grow over the coming months.
The most important component of the Company's business model is the advertising campaigns. The growth in both advertisements served and revenues provides evidence of the increasing adoption of Phorm's product in the market. Unaudited revenue derived from Russia has almost doubled, from RUB15.7 million (approximately US$0.3 million) in Q1 2015 to RUB29.0 million (approximately US$0.5 million) in Q2 2015. The growth in revenue is based on demonstrating the performance of the platform to the advertisers through a series of paid for test campaigns. Phorm is now working with six of the top tier global agencies in Russia.
Phorm is also delighted to announce that, following these results, five of the agencies have agreed to begin integrating Phorm's platform into their trading desks, which is expected to significantly increase the number of campaigns to which Phorm has access. In addition, two of these agencies have already started integration training. The Company is particularly pleased with this development as it provides rapid access to large numbers of campaigns without having to increase the cost base of our Russian operations.
United States of America ("US")
Key Performance Indicator
2015 Q2
Average of daily unique users (m)
42.4
Total advertising requests (m)
361,331.8
Total advertisements served (m)
65.9
The Company announced on 21 April 2015 that is had started commercial operations in the US and has been very pleased with the initial reaction it has received in the market.
In terms of users, Phorm has been able to build an audience comparatively quickly and, on average, now has access to 42.4 million daily unique users.
The Company has placed significant focus on its ability to integrate with third parties, as it is a route to generating significant commercial scale rapidly. The initial results of this strategy can be seen by the number of advertising requests to which the Company has access. In Q2 2015, Phorm had access to 361.3 billion advertising requests, which is four times more than in Russia and achieved in significantly less time.
At this stage, the Company is serving both paid and free test campaigns. There are currently eight campaigns running and Phorm is delighted with the way these initial campaigns are performing and is confident that the majority, if not all, of the free test campaigns will convert to paid-for campaigns in the near future. The pipeline of potential opportunities in the US currently stands at over US$0.5 million and the Company expects this to grow rapidly.
As in Russia, the Company will be pursuing a strategy of integrating its technology with the trading desks of the major agencies to quickly access large numbers of campaigns.
China
In China, as the Company announced on 21 April 2015, the focus has been on developing a partnership with a large local player. A number of these discussions are progressing and further announcements will be made as and when appropriate.
-Ends-
For further information please contact:
Phorm Corporation Limited
Andy Croxson (analysts and investors)
+44 20 3397 6001
UK Investors
Mirabaud Securities LLP (Broker)
+44 20 7321 2508
Jason Woollard
Peter Krens
Strand Hanson Limited (Nominated Adviser)
+44 20 7409 3494
James Harris
Matthew Chandler
James Dance
US Investors
Lippert/Heilshorn and Associates (Investor Relations)
+1 212 838 3777
John Heilshorn
About Phorm
Phorm is a global personalisation technology company that makes content and advertising more relevant to the consumer. Phorm's innovative platform preserves user privacy and delivers a more interesting online experience.
Phorm's industry leading technology enables its ISP partners to offer a new type of online advertising platform and a free consumer internet content feature, ensuring more relevant advertisements and personalised content for opted-in users.
Phorm's advertising platform revolutionises current standards of online privacy, fully protecting the identity of consumers. Phorm's solution is completely opt-in. Only those users consenting to the service are profiled and only ever on an anonymous basis.
Phorm's partners include leading ISPs, Publishers, Advertising Networks and Advertisers.
Phorm, under a predecessor holding company, was admitted to trading on the AIM market of the London Stock Exchange in 2004.
