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comScore(SCOR) - 2022 Q1 - Quarterly Report
2022-05-10 21:04
Financial Performance - Revenues for the three months ended March 31, 2022, were $93,966,000, representing an increase of 3.6% compared to $90,330,000 for the same period in 2021[15]. - Net loss for the three months ended March 31, 2022, was $9,276,000, a significant improvement from a net loss of $36,355,000 in the same period of 2021[15]. - The company reported a basic and diluted net loss per common share of $0.14 for the three months ended March 31, 2022, compared to $0.49 for the same period in 2021[15]. - The company reported a comprehensive loss of $9,817,000 for the three months ended March 31, 2022, compared to a comprehensive loss of $38,506,000 for the same period in 2021[15]. - Total revenue for the three months ended March 31, 2022, was $93.966 million, an increase of 4.1% compared to $90.330 million for the same period in 2021[51]. - Digital Ad Solutions revenue was $53.137 million, while Cross Platform Solutions revenue increased to $40.829 million from $37.285 million year-over-year[51]. - The United States market contributed $84.082 million to total revenue, up from $77.774 million in the prior year, representing a growth of 8.4%[51]. - Revenues for Q1 2022 were $93,966,000, a 4.0% increase from $90,330,000 in Q1 2021[106]. Expenses and Losses - The company incurred total expenses from operations of $104,512,000 for the three months ended March 31, 2022, compared to $101,789,000 for the same period in 2021[15]. - Total expenses from operations for Q1 2022 were $104,512,000, leading to a loss from operations of $10,546,000, compared to a loss of $11,459,000 in Q1 2021[106]. - Selling and marketing expenses decreased to $17,166,000, down 3.7% from $17,827,000 in Q1 2021[115]. - Research and development expenses were $9,532,000, a decrease of 7.9% from $10,353,000 in Q1 2021[117]. - General and administrative expenses increased to $18,117,000, up 25.2% from $14,468,000 in Q1 2021[119]. - Systems and bandwidth costs rose by 41.4% to $9,667,000, primarily due to cloud computing and processing costs[113]. Assets and Liabilities - Total current assets as of March 31, 2022, were $109,050,000, slightly down from $109,107,000 as of December 31, 2021[14]. - Total liabilities increased to $254,568,000 as of March 31, 2022, compared to $252,413,000 as of December 31, 2021[14]. - Total stockholders' equity decreased to $213,260,000 as of March 31, 2022, down from $223,176,000 as of December 31, 2021[14]. - The company’s accounts receivable decreased to $64,618,000 as of March 31, 2022, from $72,059,000 as of December 31, 2021[14]. - Current contract liabilities increased to $58.563 million from $54.011 million as of December 31, 2021[52]. - The contingent consideration liability increased to $7,948,000 as of March 31, 2022, from $5,600,000 as of December 31, 2021, reflecting a loss of $2,348,000 due to remeasurement[83]. Cash Flow - Cash and cash equivalents increased to $29,629,000 as of March 31, 2022, from $21,854,000 as of December 31, 2021[14]. - Net cash provided by operating activities in Q1 2022 was $12,408,000, down from $17,888,000 in Q1 2021[19]. - Net cash used in investing activities was $3.8 million for the three months ended March 31, 2022, compared to $3.7 million in 2021[149]. - Net cash used in financing activities decreased significantly to $0.7 million for the three months ended March 31, 2022, from $30.5 million for the same period in 2021[150]. Debt and Financing - The company had outstanding borrowings of $16.0 million and issued letters of credit of $3.3 million under the amended Revolving Credit Agreement as of March 31, 2022, leaving a remaining borrowing capacity of $20.7 million[71]. - The Revolving Credit Agreement was amended on February 25, 2022, increasing the borrowing capacity from $25.0 million to $40.0 million and modifying the interest rate to a SOFR-based rate[66]. - The company recorded a $9.6 million loss on extinguishment of debt in March 2021, primarily due to the write-off of unamortized deferred financing costs and issuance discounts[125]. - The company may need to raise additional funds through public or private equity or debt financing if existing cash and cash flow are insufficient for future activities[154]. Stock and Equity - The company issued 82,527,609 shares of Preferred Stock on March 10, 2021, generating gross proceeds of $204.0 million, with net proceeds totaling $187.9 million after costs[54]. - Each share of Preferred Stock was convertible into 1.057292 shares of Common Stock as of March 31, 2022, with the conversion rate set to return to 1.00 upon payment of accrued dividends on June 30, 2022[55]. - The company recognized accrued dividends to holders of Preferred Stock totaling $11.7 million as of March 31, 2022, compared to $7.9 million as of December 31, 2021, marking a 48.1% increase[90]. - As of March 31, 2022, the Preferred Stock is convertible into an aggregate of 87,255,755 shares of Common Stock, potentially causing substantial dilution to existing stockholders[172]. Corporate Governance and Compliance - The Chief Financial Officer, Jonathan Carpenter, has certified the financial reports, ensuring compliance with the Sarbanes-Oxley Act[31.1][31.2]. - The company is focused on maintaining compliance with the Securities Exchange Act of 1934, as evidenced by the signed reports[185]. - The company has filed various amendments to its Certificate of Incorporation and Bylaws, indicating ongoing corporate governance updates[3][4][5][6][7]. Strategic Partnerships and Agreements - The company entered into a Data License Agreement with Charter Communications, reflecting strategic partnerships to enhance data offerings[10.1]. - The company amended its Credit Agreement with Bank of America, which may indicate a restructuring of its financial obligations[10.2]. - The company has undergone a transition and separation agreement with former executive William Livek, suggesting changes in leadership structure[10.3]. Market and Operational Risks - The ongoing geopolitical situation, including the Russian invasion of Ukraine, may lead to increased regulatory scrutiny and operational risks[171]. - The company anticipates continued revenue growth in the movies business as consumer attendance in theaters increases[110].
comScore(SCOR) - 2021 Q4 - Annual Report
2022-03-02 13:57
PART I [Business](index=4&type=section&id=Item%201.%20Business) Comscore is a global information and analytics company measuring advertising, content, and consumer audiences across various media platforms [Overview](index=4&type=section&id=Overview) Comscore measures audiences and advertising across multiple media platforms using proprietary data science to provide a common standard for transactions - Comscore measures **advertising, content, and consumer audiences** across platforms like **connected TVs, mobile devices, computers, TV, OTT, and movie screens**[19](index=19&type=chunk) - The company's proprietary data science enables **person-level and household-level audience measurement**, removing duplicated viewing across devices[19](index=19&type=chunk) - Customers include a wide range of media ecosystem players such as **digital publishers, television networks, movie studios, brand advertisers, and agencies**[19](index=19&type=chunk) [Recent Key Developments](index=4&type=section&id=Recent%20Key%20Developments) In 2021, Comscore experienced leadership changes, acquired Shareablee for social media insights, and raised $204.0 million through strategic investments - Jonathan Carpenter was appointed as CFO and Treasurer, effective November 29, 2021, while CEO William Livek announced his planned retirement in February 2022[21](index=21&type=chunk)[22](index=22&type=chunk) - Acquired Shareablee, Inc. on December 16, 2021, for up to **$45.0 million**, integrating social media engagement insights into its Media Metrix® and Video Metrix® products[23](index=23&type=chunk)[25](index=25&type=chunk) - Completed strategic investment transactions with Charter, Qurate, and Pine on March 10, 2021, issuing Series B Convertible Preferred Stock for **$204.0 million** to repay outstanding senior secured convertible notes[26](index=26&type=chunk) [Our Approach to Media Measurement](index=5&type=section&id=Our%20Approach%20to%20Media%20Measurement) Comscore's measurement approach combines extensive data collection from panels and third-party sources with advanced data science for cross-platform audience insights - Data collection methods include **proprietary consumer panels, website/app tagging, licensed third-party data, and TV viewership information** from millions of screens[30](index=30&type=chunk) - Key data science innovations include the **UDM methodology** for combining panel and server data, **cross-platform audience de-duplication**, and accredited **Invalid Traffic filtration** methods[33](index=33&type=chunk) [Our Products and Services](index=6&type=section&id=Our%20Products%20and%20Services) Comscore's products are organized into Ratings and Planning, Analytics and Optimization, and Movies Reporting and Analytics, covering audience measurement, campaign evaluation, and box office results - Products and services are categorized into **Ratings and Planning, Analytics and Optimization, and Movies Reporting and Analytics** solution groups[35](index=35&type=chunk) - **Ratings and Planning** products (e.g., Media Metrix, TV Essentials) measure audience size, reach, and demographics across TV and digital platforms[36](index=36&type=chunk) - **Analytics and Optimization** products (e.g., vCE, Lift Models, Activation Solutions) offer solutions for ad campaign planning, validation, and evaluation[36](index=36&type=chunk)[37](index=37&type=chunk) - **Movies Reporting and Analytics** products (e.g., Box Office Essentials, PostTrak) provide real-time measurement of movie ticket sales and audience demographics worldwide[38](index=38&type=chunk) [New Product Investments and Releases](index=8&type=section&id=New%20Product%20Investments%20and%20Releases) Comscore is developing privacy-centric, cookieless solutions, launching Predictive Audiences, enhancing Branded Content reporting with AI, and introducing Consumer Intelligence for local markets - The company is adapting to a **privacy-centric, cookieless environment** by leveraging panel data and participating in industry initiatives like the ANA's Cross-Media Measurement pilot[40](index=40&type=chunk)[41](index=41&type=chunk) - Launched **'Predictive Audiences'** in Q1 2021, a cookie-free targeting solution for digital, mobile, and CTV campaigns[43](index=43&type=chunk) - Partnered with Hive to use **AI-powered computer vision for logo detection**, enhancing Branded Content reporting to measure audience size and demographics[44](index=44&type=chunk) - Introduced **'Comscore Consumer Intelligence,'** a local market tool providing granular insights into consumer purchasing behavior and media interaction[45](index=45&type=chunk)[46](index=46&type=chunk) [Competition](index=10&type=section&id=Competition) Comscore operates in a highly competitive market, competing with full-service research firms, TV measurement startups, and online advertising companies based on accuracy and product breadth - Key competitors include **Nielsen, Ipsos, GfK, VideoAmp, iSpot, Google, Facebook, DoubleVerify, Integral Ad Science, SimilarWeb, and Adobe Analytics**[50](index=50&type=chunk) - Competition is based on providing **accurate, deduplicated audience measurement** across digital and TV platforms, **data reliability, technological adaptation**, and **product breadth**[50](index=50&type=chunk) [Government Regulation and Privacy](index=10&type=section&id=Government%20Regulation%20and%20Privacy) Comscore's business is subject to complex and evolving U.S. and international data privacy laws, including GDPR, CCPA/CPRA, and LGPD, with non-compliance risking substantial penalties - The company is subject to numerous data security and privacy laws, including **GDPR in Europe, CCPA/CPRA in California, and LGPD in Brazil**[53](index=53&type=chunk)[54](index=54&type=chunk) - Failure to comply with these evolving regulations could result in **substantial penalties** and affect the company's ability to conduct business effectively[54](index=54&type=chunk) [Human Capital Management](index=11&type=section&id=Human%20Capital%20Management) As of January 31, 2022, Comscore had 1,355 employees, with a focus on Product and Technology, emphasizing employee engagement, diversity, and inclusion Employee Distribution by Function (as of Dec 31, 2021) | Functional Area | Percent of Employees | | :--- | :--- | | Product and Technology | 53% | | Sales and Service | 22% | | Movies | 14% | | General and Administrative | 11% | - As of January 31, 2022, the company had **1,355 employees** and 145 contingent providers/contractors[56](index=56&type=chunk) - The company promotes **diversity and inclusion**, with **40% of its global workforce being female** and **40% of its U.S. employees identifying as a person of color** as of year-end 2021[65](index=65&type=chunk) [Risk Factors](index=15&type=section&id=Item%201A.%20Risk%20Factors) The company faces substantial risks from the COVID-19 pandemic, intense competition, reliance on third-party data, evolving privacy regulations, operational failures, and financial challenges including net losses and debt obligations - **Business & Technology Risks:** The COVID-19 pandemic could continue to have adverse effects, intense market competition, failure to provide complete analytics or respond to technological developments, and critical dependence on third-party data pose significant threats[85](index=85&type=chunk)[89](index=89&type=chunk)[93](index=93&type=chunk)[96](index=96&type=chunk)[97](index=97&type=chunk) - **Operational & Financial Risks:** Failure to meet analyst expectations, a history of net losses, potential inability to service debt and dividend obligations, and further impairment of goodwill are key financial concerns[86](index=86&type=chunk)[124](index=124&type=chunk)[128](index=128&type=chunk)[131](index=131&type=chunk)[137](index=137&type=chunk) - **Legal & Regulatory Risks:** Concerns over privacy violations and data breaches, domestic and foreign laws (like GDPR, CCPA) limiting data collection, and intellectual property infringement claims present ongoing legal challenges[87](index=87&type=chunk)[142](index=142&type=chunk)[146](index=146&type=chunk)[150](index=150&type=chunk) - **Capital Structure Risks:** Holders of Series B Preferred Stock have significant influence and consent rights, potentially conflicting with common stockholders' interests, and the credit facility contains restrictive covenants limiting operational flexibility[88](index=88&type=chunk)[162](index=162&type=chunk)[169](index=169&type=chunk) [Properties](index=31&type=section&id=Item%202.%20Properties) Comscore's corporate headquarters are in Reston, Virginia, occupying 84,000 square feet, with additional leased offices globally, though most employees currently work remotely - The corporate headquarters in Reston, Virginia, consists of approximately **84,000 square feet** of leased office space[184](index=184&type=chunk) - Other material leased locations include offices in **Portland, New York, and Chicago**[189](index=189&type=chunk) - As of December 31, 2021, the company leased facilities in **25 locations globally**, with about **45,000 square feet being subleased**[184](index=184&type=chunk) PART II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=32&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Comscore's common stock trades on Nasdaq under 'SCOR', with 104 stockholders of record as of February 24, 2022, and its performance lagged major indices from 2016 to 2021 - The company's common stock is traded on The Nasdaq Global Select Market under the symbol **\"SCOR\"**[191](index=191&type=chunk) - As of February 24, 2022, there were **104 stockholders of record**[192](index=192&type=chunk) - The stock performance from **2016 to 2021 lagged behind major indices** including the Nasdaq Composite, S&P MidCap 400, and Nasdaq Computer Index[193](index=193&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=34&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Comscore's 2021 total revenue increased by 3.1% to $367.0 million, driven by Analytics and Optimization growth, while reporting a net loss of $50.0 million and improving cash from operations to $9.9 million [Results of Operations](index=34&type=section&id=Results%20of%20Operations) In 2021, total revenues grew 3.1% to $367.0 million, primarily from Analytics and Optimization, resulting in a net loss of $50.0 million and increased cost of revenues due to higher data costs Consolidated Statement of Operations Summary (in thousands) | | 2021 | 2020 | 2019 | | :--- | :--- | :--- | :--- | | **Revenues** | **$367,013** | **$356,036** | **$388,645** | | Total expenses from operations | $395,878 | $377,311 | $699,112 | | Loss from operations | $(28,865) | $(21,275) | $(310,467) | | **Net loss** | **$(50,037)** | **$(47,918)** | **$(338,996)** | Revenues by Solution Group (2021 vs 2020, in thousands) | Solution Group | 2021 | 2020 | $ Variance | % Variance | | :--- | :--- | :--- | :--- | :--- | | Ratings and Planning | $255,073 | $253,652 | $1,421 | 0.6% | | Analytics and Optimization | $81,306 | $69,080 | $12,226 | 17.7% | | Movies Reporting and Analytics | $30,634 | $33,304 | $(2,670) | (8.0)% | | **Total revenues** | **$367,013** | **$356,036** | **$10,977** | **3.1%** | - Cost of revenues increased by **$22.3 million (12.4%)** in 2021, primarily due to a **$10.6 million increase in data costs**, including an expanded license with Charter[222](index=222&type=chunk) - Selling and marketing expenses decreased by **$3.3 million (4.7%)** in 2021, driven by lower commission expense and reduced office footprint[225](index=225&type=chunk) - General and administrative expenses increased by **$6.0 million (10.7%)** in 2021, mainly due to higher stock-based compensation and professional fees related to a new ERP system implementation[231](index=231&type=chunk) [Liquidity and Capital Resources](index=42&type=section&id=Liquidity%20and%20Capital%20Resources) Comscore's liquidity was significantly impacted by raising $204.0 million from preferred stock issuance in March 2021 to repay senior notes, resulting in $9.9 million net cash from operations Cash Flow Summary (in thousands) | | 2021 | 2020 | 2019 | | :--- | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $9,856 | $717 | $(4,636) | | Net cash used in investing activities | $(14,648) | $(15,555) | $(10,460) | | Net cash (used in) provided by financing activities | $(22,452) | $(2,096) | $31,973 | - On March 10, 2021, the company raised **$204.0 million** in gross proceeds by issuing Series B Convertible Preferred Stock, using the funds to repay its senior secured convertible notes[260](index=260&type=chunk)[261](index=261&type=chunk) - Entered into a new revolving credit agreement on May 5, 2021, with **$16.0 million in borrowings** and **$3.3 million in letters of credit** outstanding as of December 31, 2021[262](index=262&type=chunk)[263](index=263&type=chunk) - As of December 31, 2021, the company has a total fixed payment obligation of **$325.8 million** for data licensing agreements with MVPDs, with terms ranging from one to nine years[290](index=290&type=chunk) [Critical Accounting Estimates](index=45&type=section&id=Critical%20Accounting%20Estimates) Comscore's critical accounting estimates involve significant judgment in revenue recognition, particularly for bundled contracts, and annual goodwill impairment analysis using discounted cash flow and market approaches - **Revenue Recognition:** Significant judgments are required to identify distinct performance obligations and estimate the standalone selling price (SSP) for bundled products, impacting the timing and amount of revenue recognized[296](index=296&type=chunk)[298](index=298&type=chunk) - **Goodwill Impairment:** Goodwill is tested annually by comparing the fair value of the single reporting unit to its carrying value, determined using discounted cash flow and market approaches reliant on key assumptions[299](index=299&type=chunk)[301](index=301&type=chunk) - Key assumptions for the 2021 goodwill impairment analysis included a **long-term growth rate of 3.0%** and a **discount rate of 19.0%**[303](index=303&type=chunk)[304](index=304&type=chunk) - As of the October 1, 2021 annual assessment, the estimated fair value of the reporting unit **exceeded its carrying value by approximately 40%**, indicating no impairment[307](index=307&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=47&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Comscore is exposed to interest rate risk from variable-rate borrowings, financial instrument risk from warrants sensitive to stock price, and foreign currency risk from global operations - The company is subject to **interest rate risk** on its Revolving Credit Agreement, which has a variable rate based on the Daily SOFR[311](index=311&type=chunk) - The warrants liability, valued at **$10.5 million** at year-end 2021, is subject to market risk, where a **10% increase in stock price would increase Series A Warrants' fair value by $1.5 million**[313](index=313&type=chunk)[314](index=314&type=chunk) - The company has **foreign currency risk** from its global operations, with a 10% adverse change in foreign currency values potentially increasing the net loss by approximately **$5.7 million for 2021**[315](index=315&type=chunk)[317](index=317&type=chunk) [Financial Statements and Supplementary Data](index=49&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents Comscore's audited consolidated financial statements for the three years ended December 31, 2021, including balance sheets, statements of operations, cash flows, and detailed notes [Report of Independent Registered Public Accounting Firm](index=50&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) Deloitte & Touche LLP issued an unqualified opinion on Comscore's 2021 financial statements and internal controls, highlighting critical audit matters in revenue recognition, goodwill impairment, and preferred stock accounting - Deloitte & Touche LLP issued an **unqualified opinion** on the financial statements and the effectiveness of internal control over financial reporting as of December 31, 2021[322](index=322&type=chunk)[323](index=323&type=chunk) - **Critical Audit Matter 1:** Revenue recognition, focusing on judgments in identifying performance obligations, determining transaction prices, and allocating them[327](index=327&type=chunk)[328](index=328&type=chunk) - **Critical Audit Matter 2:** Goodwill impairment analysis, specifically the significant judgments in forecasting future revenue and selecting the discount rate[331](index=331&type=chunk)[333](index=333&type=chunk) - **Critical Audit Matter 3:** Accounting for the preferred stock transaction, highlighting the complexity of analyzing embedded derivative features and classification[337](index=337&type=chunk)[339](index=339&type=chunk) [Consolidated Financial Statements](index=53&type=section&id=Consolidated%20Financial%20Statements) The consolidated financial statements show Comscore's total assets at $663.5 million and total liabilities at $252.4 million as of December 31, 2021, with a net loss of $50.0 million for the year Consolidated Balance Sheet Data (in thousands) | | Dec 31, 2021 | Dec 31, 2020 | | :--- | :--- | :--- | | Total current assets | $109,107 | $137,030 | | **Total assets** | **$663,474** | **$677,970** | | Total current liabilities | $165,371 | $184,275 | | **Total liabilities** | **$252,413** | **$448,980** | | Convertible redeemable preferred stock | $187,885 | $— | | **Total stockholders' equity** | **$223,176** | **$228,990** | Consolidated Statement of Operations Data (in thousands) | | 2021 | 2020 | 2019 | | :--- | :--- | :--- | :--- | | Revenues | $367,013 | $356,036 | $388,645 | | Loss from operations | $(28,865) | $(21,275) | $(310,467) | | **Net loss** | **$(50,037)** | **$(47,918)** | **$(338,996)** | | Net loss per share (Basic & Diluted) | $(0.78) | $(0.67) | $(5.33) | [Notes to Consolidated Financial Statements](index=59&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail the Shareablee acquisition for $31.4 million, the $204 million Series B Preferred Stock issuance and senior notes extinguishment, lease obligations, and related party transactions - Acquired Shareablee on December 16, 2021, for total purchase consideration of **$31.4 million**, resulting in **$19.2 million of goodwill** and **$12.6 million of definite-lived intangible assets**[442](index=442&type=chunk)[444](index=444&type=chunk) - As of December 31, 2021, the company has approximately **$210 million of revenue** expected to be recognized from remaining performance obligations under long-term contracts[454](index=454&type=chunk) - Issued **82,527,609 shares of Series B Convertible Preferred Stock** for net proceeds of **$187.9 million**, with a **7.5% cumulative annual dividend**, classified as mezzanine equity[455](index=455&type=chunk)[462](index=462&type=chunk)[361](index=361&type=chunk) - Used proceeds from the preferred stock issuance to extinguish **$204.0 million of senior secured convertible notes**, resulting in a **loss on extinguishment of $9.3 million**[495](index=495&type=chunk)[498](index=498&type=chunk) - As of December 31, 2021, the company had federal and state net operating loss carryforwards of **$620.0 million** and **$1,403.0 million**, respectively, subject to limitation[542](index=542&type=chunk) [Controls and Procedures](index=90&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that disclosure controls and internal control over financial reporting were effective as of December 31, 2021, an assessment also affirmed by Deloitte & Touche LLP - The principal executive officer and principal financial officer concluded that **disclosure controls and procedures were effective** as of December 31, 2021[565](index=565&type=chunk) - Management concluded that **internal control over financial reporting was effective** as of December 31, 2021, an assessment audited by Deloitte & Touche LLP, which also issued an unqualified opinion[566](index=566&type=chunk)[567](index=567&type=chunk) - A new **enterprise resource planning (ERP) system** was implemented in Q3 2021, leading to changes in reporting processes and internal controls[569](index=569&type=chunk) PART III [Directors, Executive Officers and Corporate Governance](index=93&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information regarding directors, executive officers, and corporate governance is incorporated by reference from the company's 2022 Proxy Statement - Information required by this item is **incorporated by reference** from the company's 2022 Proxy Statement[584](index=584&type=chunk) [Executive Compensation](index=93&type=section&id=Item%2011.%20Executive%20Compensation) Information regarding executive compensation is incorporated by reference from the company's 2022 Proxy Statement - Information required by this item is **incorporated by reference** from the company's 2022 Proxy Statement[586](index=586&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=93&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Information regarding security ownership of beneficial owners, management, and related stockholder matters is incorporated by reference from the company's 2022 Proxy Statement - Information required by this item is **incorporated by reference** from the company's 2022 Proxy Statement[587](index=587&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=93&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information regarding certain relationships, related transactions, and director independence is incorporated by reference from the company's 2022 Proxy Statement - Information required by this item is **incorporated by reference** from the company's 2022 Proxy Statement[588](index=588&type=chunk) [Principal Accounting Fees and Services](index=93&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) Information regarding principal accountant fees and services is incorporated by reference from the company's 2022 Proxy Statement - Information required by this item is **incorporated by reference** from the company's 2022 Proxy Statement[589](index=589&type=chunk) PART IV [Exhibits, Financial Statement Schedules](index=94&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section lists the financial statements and exhibits filed as part of the Annual Report on Form 10-K, with other schedules omitted as inapplicable - This section contains the list of **financial statements and exhibits** filed as part of the 10-K report[592](index=592&type=chunk)
comScore(SCOR) - 2021 Q4 - Earnings Call Transcript
2022-03-01 02:27
comScore, Inc. (NASDAQ:SCOR) Q4 2021 Earnings Conference Call February 28, 2022 5:00 PM ET Company Participants John Tinker – Vice President-Investor Relations Bill Livek – Chief Executive Officer Jon Carpenter – Chief Financial Officer Conference Call Participants Laura Martin – Needham Jason Kreyer – Craig-Hallum Matthew Thornton – Truist Securities Benjamin Huang – Jefferies Operator Good day and thank you for standing by. Welcome to the Comscore Fourth Quarter 2021 Financial Results Conference Call. At ...
comScore(SCOR) - 2021 Q3 - Quarterly Report
2021-11-09 14:01
Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 _____________________________________________ FORM 10-Q _____________________________________________ (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2021 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 001-33520 _______ ...
comScore(SCOR) - 2021 Q3 - Earnings Call Transcript
2021-11-09 03:06
comScore, Inc. (NASDAQ:SCOR) Q3 2021 Earnings Conference Call November 8, 2021 5:00 PM ET Company Participants John Tinker - Vice President of Investor Relations Bill Livek - Executive Vice Chairman & Chief Executive Officer Mary Margaret Curry - Senior Vice President & Controller Chris Wilson - Chief Commercial Officer Conference Call Participants Alan Gould - Loop Capital Jason Kreyer - Craig-Hallum Laura Martin - Needham Operator Ladies and gentlemen, thank you for standing by and welcome to the comScore ...
comScore(SCOR) - 2021 Q2 - Earnings Call Transcript
2021-08-10 03:03
Financial Data and Key Metrics Changes - The company reported second quarter revenue of $87.7 million, a decrease from $88.6 million in the same quarter last year [27] - The net loss for the second quarter was $18.5 million compared to a net loss of $10.4 million in the same period last year [33] - Adjusted EBITDA for the second quarter was $2.6 million, down from $9.2 million for the same period last year [33] - Total cash at the end of the second quarter was $17.7 million, down from $50.7 million at the end of the previous year [34] Business Line Data and Key Metrics Changes - Revenue from Ratings and Planning was $62.4 million, down from $63.8 million, primarily due to lower syndicated digital revenue [27] - TV revenue comprised 43% of Ratings and Planning revenue, up from 40% last year, while syndicated digital revenue comprised 46%, down from 48% [28] - Revenue from Analytics and Optimization increased to $17.8 million from $16.9 million, driven by higher Lift and Survey revenue and a 65% year-over-year increase in Activation revenue [29] - Movies Reporting and Analytics revenue was $7.5 million, down from $7.9 million year-over-year but up 10% sequentially [30] Market Data and Key Metrics Changes - The company experienced a rebound in the movie business as U.S. theaters reopened, with expectations for box office revenues to return to pre-pandemic levels over the next year [23][24] - The company signed new agreements with major studios and expanded relationships, indicating a positive trend in the movie industry [24] Company Strategy and Development Direction - The company is focusing on growing its business and investing in new products following the completion of a recapitalization transaction [5] - The integration with Google Ad Data Hubs is expected to enhance cross-platform advertising measurement, which is a strategic move to capture more market share [16][18] - The company aims to expand its predictive audience measurement capabilities beyond North America, indicating a strategy for global growth [20] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the ongoing effects of the pandemic but expressed optimism about new contracts generating revenue in the latter half of 2021 and into 2022 [9][10] - The management highlighted the importance of adapting to changes in media consumption and the need for modern measurement solutions [8] - There is cautious optimism regarding the recovery of the advertising market, with expectations for higher revenue in the second half of the year [35] Other Important Information - The company announced the planned departure of its Chief Financial Officer, Greg Fink, who played a critical role in the company's recovery [25] - The company is in the early stages of measuring out-of-home advertising, with agreements signed with major digital out-of-home advertising companies [22] Q&A Session Summary Question: Can you talk about how the YouTube announcements drive long-term revenue growth? - Management explained that the integration allows for validation of true reach for campaigns on YouTube and YouTube TV, which is expected to enhance revenue opportunities [40] Question: Why did it take longer to sign some contracts? - Management noted that the cautious spending environment among media customers contributed to the delays, but they are optimistic about future revenue from signed contracts [56] Question: What is the outlook for the movie business? - Management anticipates a return to pre-pandemic revenue levels as theaters are reopening, and they are focused on measuring movie consumption across various platforms [60]
comScore(SCOR) - 2021 Q2 - Quarterly Report
2021-08-09 21:03
PART I. FINANCIAL INFORMATION [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) Unaudited financial statements detail the company's financial position, operations, and cash flows, reflecting a major recapitalization and debt extinguishment [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Condensed Consolidated Balance Sheets (in thousands) | Account | June 30, 2021 (Unaudited) | December 31, 2020 | | :--- | :--- | :--- | | Cash and cash equivalents | $16,659 | $31,126 | | Total current assets | $93,844 | $137,030 | | **Total assets** | **$627,379** | **$677,970** | | Total current liabilities | $177,479 | $184,275 | | Senior secured convertible notes | $— | $192,895 | | **Total liabilities** | **$240,873** | **$448,980** | | Convertible redeemable preferred stock | $187,885 | $— | | **Total stockholders' equity** | **$198,621** | **$228,990** | [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) Three Months Ended June 30 (in thousands) | Metric | Three Months Ended June 30, 2021 | Three Months Ended June 30, 2020 | | :--- | :--- | :--- | | Revenues | $87,659 | $88,566 | | Loss from operations | $(10,890) | $(2,742) | | Net loss | $(18,545) | $(10,401) | | Net loss available to common stockholders | $(22,413) | $(10,401) | | Basic and diluted EPS | $(0.28) | $(0.15) | Six Months Ended June 30 (in thousands) | Metric | Six Months Ended June 30, 2021 | Six Months Ended June 30, 2020 | | :--- | :--- | :--- | | Revenues | $177,989 | $178,094 | | Loss from operations | $(22,349) | $(15,493) | | Loss on extinguishment of debt | $(9,629) | $— | | Net loss | $(54,900) | $(23,585) | | Net loss available to common stockholders | $(59,703) | $(23,585) | | Basic and diluted EPS | $(0.76) | $(0.34) | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Six Months Ended June 30 (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2021 | Six Months Ended June 30, 2020 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $10,860 | $(1,792) | | Net cash used in investing activities | $(7,723) | $(7,881) | | Net cash used in financing activities | $(35,876) | $(1,046) | | **Net decrease in cash, cash equivalents and restricted cash** | **$(33,061)** | **$(11,263)** | - Financing activities in the first six months of 2021 were dominated by the net effect of receiving **$188.2 million** in proceeds from issuing convertible redeemable preferred stock, largely used for the **$204.0 million** extinguishment of senior secured convertible notes and a **$14.0 million** payment on a secured term note[26](index=26&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail significant accounting policies and events, including the March 2021 preferred stock issuance for debt extinguishment, and new data license and credit facility agreements - On March 10, 2021, the company issued **82,527,609 shares** of **Series B Convertible Preferred Stock** for net proceeds of **$188.2 million**, classified as **mezzanine equity** due to a contingent redemption feature upon a change of control[39](index=39&type=chunk)[42](index=42&type=chunk) - Proceeds from preferred stock issuance were used to extinguish **$204.0 million** senior secured convertible notes and a secured promissory note on March 10, 2021, resulting in a **$9.6 million** loss on debt extinguishment[37](index=37&type=chunk)[65](index=65&type=chunk)[70](index=70&type=chunk) Revenue by Solution Group (in thousands) | Revenue by Solution Group (in thousands) | Q2 2021 | Q2 2020 | | :--- | :--- | :--- | | Ratings and Planning | $62,418 | $63,779 | | Analytics and Optimization | $17,764 | $16,894 | | Movies Reporting and Analytics | $7,477 | $7,893 | | **Total** | **$87,659** | **$88,566** | - On May 5, 2021, the company entered into a new senior secured revolving credit agreement with a borrowing capacity of **$25.0 million**[72](index=72&type=chunk)[73](index=73&type=chunk) - Concurrent with the new investment, the company entered into a **ten-year Data License Agreement** with Charter Communications, involving gradually increasing license fees from **$10.0 million** in year one to **$32.3 million** in year ten[109](index=109&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=24&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, liquidity, and capital resources, highlighting flat Q2 2021 revenue, increased operating loss, and a major financing transaction [Results of Operations](index=24&type=section&id=Results%20of%20Operations) Q2 2021 revenues decreased slightly to **$87.7 million**, with increased cost of revenues leading to a wider operating loss of **$10.9 million** Revenue by Solution Group (in thousands) | Revenue by Solution Group (in thousands) | Q2 2021 | Q2 2020 | % Change | | :--- | :--- | :--- | :--- | | Ratings and Planning | $62,418 | $63,779 | (2.1)% | | Analytics and Optimization | $17,764 | $16,894 | 5.1% | | Movies Reporting and Analytics | $7,477 | $7,893 | (5.3)% | | **Total revenues** | **$87,659** | **$88,566** | **(1.0)%** | - The decrease in **Movies Reporting and Analytics revenue** continued to be impacted by theater closures and delayed releases due to the **COVID-19 pandemic**[131](index=131&type=chunk) - Cost of revenues for Q2 2021 increased by **$6.4 million (14.3%)** year-over-year, primarily driven by a **$3.5 million** increase in data costs and a **$1.3 million** increase in systems and bandwidth costs[138](index=138&type=chunk) - A loss on debt extinguishment of **$9.6 million** was recorded in Q1 2021 related to the payoff of senior secured convertible notes and the secured term note[153](index=153&type=chunk) [Liquidity and Capital Resources](index=31&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity was altered in Q1 2021 by a **$188.2 million** preferred stock issuance for debt repayment, a new **$25.0 million** revolving credit facility, and substantial contractual obligations - As of June 30, 2021, principal liquidity sources included **$17.7 million** in cash, cash equivalents, and restricted cash, plus availability under a new Revolving Credit Agreement[165](index=165&type=chunk) - On March 10, 2021, the company issued preferred stock for net proceeds of **$188.2 million**, used to repay its senior secured convertible notes[167](index=167&type=chunk)[168](index=168&type=chunk) - In May 2021, the company entered into a new three-year, **$25.0 million** senior secured revolving credit agreement, under which **$8.0 million** was borrowed in July 2021[169](index=169&type=chunk)[177](index=177&type=chunk) Contractual Payment Obligations (in millions) | Contractual Payment Obligation | Amount as of June 30, 2021 | | :--- | :--- | | MVPD Data Licensing Agreements | $384.9 million | | Operating and Financing Leases | $66.6 million | | Cloud-based Data Storage | $24.5 million | [Critical Accounting Policies](index=34&type=section&id=Critical%20Accounting%20Policies) Critical accounting policies include those for new Preferred Stock classified as mezzanine equity and the early adoption of ASU 2020-06 for convertible instruments - The new **Series B Convertible Preferred Stock** is classified as **mezzanine equity** due to a contingent redemption feature upon a change of control[200](index=200&type=chunk) - Effective January 1, 2021, the company early-adopted **ASU 2020-06**, simplifying accounting for convertible instruments, with no impact on previously issued senior secured convertible notes[202](index=202&type=chunk)[203](index=203&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=36&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosure%20about%20Market%20Risk) The company faces market risks from its **$19.4 million** warrants liability, sensitive to stock price changes, and interest rate fluctuations on its new revolving credit facility - The company has a **$19.4 million** warrants liability as of June 30, 2021, whose fair value is sensitive to the company's stock price[208](index=208&type=chunk) - A **10% increase** in common stock price would result in a **$2.5 million increase** in Series A Warrants' fair value, while a **10% decrease** would result in a **$2.4 million decrease**[209](index=209&type=chunk) - The company is subject to **interest rate risk** from its variable-rate **Revolving Credit Agreement**, though exposure was not material as of June 30, 2021[210](index=210&type=chunk) [Item 4. Controls and Procedures](index=37&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of June 30, 2021, with no material changes, and expects to complete a new ERP system implementation in Q3 2021 - The principal executive and financial officers concluded that disclosure controls and procedures were **effective** as of June 30, 2021[213](index=213&type=chunk) - The company is implementing a new **enterprise resource planning (ERP) system**, expected to be completed in **Q3 2021**, to improve internal control over financial reporting[215](index=215&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=38&type=section&id=Item%201.%20Legal%20Proceedings) The company reports on legal proceedings, primarily a privacy class action lawsuit that received final settlement approval on April 12, 2021, with costs covered by insurance - A **privacy class action lawsuit** against the company received final court approval for settlement on **April 12, 2021**, with **no admission of liability** and costs **covered by insurance**[117](index=117&type=chunk)[219](index=219&type=chunk) [Item 1A. Risk Factors](index=38&type=section&id=Item%201A.%20Risk%20Factors) Key risks include restrictive covenants and potential default under the new revolving credit facility, alongside implementation challenges for the new ERP system - The new Revolving Credit Agreement contains **restrictive covenants** that could **limit operating flexibility** by restricting additional debt, investments, and dividends[223](index=223&type=chunk) - Failure to meet **financial covenants**, such as minimum Consolidated EBITDA, could result in an **event of default** and **acceleration of outstanding debt** under the credit facility[224](index=224&type=chunk)[225](index=225&type=chunk) - Delays or errors in implementing the new **enterprise resource planning (ERP) system** could **adversely affect** transaction recording, financial reporting, and business process management[226](index=226&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=39&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities, no use of proceeds from registered equity, and no equity purchases during Q2 2021 - There were **no unregistered sales of equity securities** during the three months ended June 30, 2021[227](index=227&type=chunk) [Item 3. Defaults Upon Senior Securities](index=39&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This section is not applicable as the company reports no defaults upon senior securities [Item 4. Mine Safety Disclosures](index=39&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section is not applicable [Item 5. Other Information](index=39&type=section&id=Item%205.%20Other%20Information) This section is not applicable [Item 6. Exhibits](index=40&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with Form 10-Q, including corporate governance documents, the new Credit Agreement, and CEO/CFO certifications
comScore(SCOR) - 2021 Q1 - Earnings Call Transcript
2021-05-09 08:50
Financial Data and Key Metrics Changes - The company reported first quarter revenue of $90.3 million, an increase from $89.5 million in the same quarter last year, marking the first year-over-year increase since Q4 2018 [29] - Adjusted EBITDA for the first quarter was $5.6 million, down from $6.4 million in the prior year, impacted by higher data costs but benefiting from lower operating costs [37] - The net loss for the first quarter was $36.4 million, compared to a net loss of $13.2 million in the same period last year, including a non-cash charge of $15.3 million related to debt extinguishment [36] Business Line Data and Key Metrics Changes - Revenue from ratings and planning was $65.8 million, up from $63.5 million, driven by higher TV revenue and international cross-platform services [29] - Analytics and optimization revenue increased to $17.7 million from $15.5 million, attributed to higher custom solutions and activation revenue [32] - Movies reporting and analytics revenue decreased to $6.8 million from $10.5 million, impacted by theater closures and delayed releases due to the pandemic [33] Market Data and Key Metrics Changes - TV revenue comprised 46% of ratings and planning revenue, up from 42% last year, while syndicated digital revenue decreased to 45% from 50% [31] - The company expects revenue from the movie business to rebound as theaters reopen, with early signs of recovery noted in box office sales [22][23] Company Strategy and Development Direction - The company is focused on capitalizing on opportunities in both traditional and direct-to-consumer media platforms, enhancing its measurement capabilities [4][6] - Plans to enter new markets and expand product offerings are in place, with a focus on privacy-focused solutions to recapture customers [6][8] - The company aims to improve revenue and margins through investments in data inputs and new commercial relationships [13] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about revenue growth in the second half of 2021, driven by new products and partnerships [38] - The company anticipates a 3% to 5% revenue increase for 2021, with adjusted EBITDA margins expected to be between 6% and 8% [38] - Management noted that the pandemic's impact on the movie industry is expected to lessen as theaters reopen [22][23] Other Important Information - The company completed a recapitalization transaction that significantly reduced outstanding debt, providing financial flexibility for future investments [4] - A new partnership with Dish Media Sling was announced, aimed at enhancing cross-platform measurement capabilities [20] Q&A Session Summary Question: Revenue growth cadence over the next three quarters - Management is optimistic about revenue growth in the back half of 2021, with expectations for improving quarters throughout the year [42][43]
comScore(SCOR) - 2021 Q1 - Quarterly Report
2021-05-06 21:05
PART I. FINANCIAL INFORMATION [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) The unaudited condensed consolidated financial statements for the quarter ended March 31, 2021, show a net loss of $36.4 million, compared to a net loss of $13.2 million in the prior-year period, with total assets decreasing to $643.6 million from $678.0 million at year-end 2020 Condensed Consolidated Balance Sheet Highlights (As of March 31, 2021) | Account | March 31, 2021 ($ thousands) | December 31, 2020 ($ thousands) | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $29,075 | $31,126 | | Total current assets | $107,460 | $137,030 | | Total assets | $643,636 | $677,970 | | **Liabilities & Equity** | | | | Total current liabilities | $181,187 | $184,275 | | Total liabilities | $237,045 | $448,980 | | Convertible redeemable preferred stock | $188,183 | $— | | Total stockholders' equity | $218,408 | $228,990 | Condensed Consolidated Statement of Operations Highlights (Three Months Ended March 31) | Account | 2021 ($ thousands) | 2020 ($ thousands) | | :--- | :--- | :--- | | Revenues | $90,330 | $89,528 | | Loss from operations | ($11,459) | ($12,751) | | Loss on extinguishment of debt | ($9,629) | $— | | Net loss | ($36,355) | ($13,184) | | Net loss per common share (Basic and diluted) | ($0.49) | ($0.19) | Condensed Consolidated Statement of Cash Flows Highlights (Three Months Ended March 31) | Activity | 2021 ($ thousands) | 2020 ($ thousands) | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $17,888 | ($4,781) | | Net cash used in investing activities | ($3,692) | ($3,917) | | Net cash used in financing activities | ($30,477) | ($549) | | Net decrease in cash, cash equivalents and restricted cash | ($16,869) | ($10,174) | [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail significant financial events in Q1 2021, including a major financing transaction, revenue disaggregation, related party transactions, a privacy class-action lawsuit settlement, and a new revolving credit agreement - On March 10, 2021, the company issued **82,527,609 shares** of Series B Convertible Preferred Stock for gross proceeds of **$204.0 million** to Charter, Qurate, and Pine, with proceeds used to repay senior secured convertible notes[32](index=32&type=chunk)[39](index=39&type=chunk) - A loss on debt extinguishment of **$9.6 million** was recorded in Q1 2021 related to the payoff of the senior secured convertible notes and the secured term note[37](index=37&type=chunk) Revenue by Solution Group (Three Months Ended March 31) | Solution Group | 2021 (in thousands) | 2020 (in thousands) | | :--- | :--- | :--- | | Ratings and Planning | $65,806 | $63,521 | | Analytics and Optimization | $17,701 | $15,501 | | Movies Reporting and Analytics | $6,823 | $10,506 | | **Total** | **$90,330** | **$89,528** | - Concurrent with the financing transaction, the company entered into a ten-year Data License Agreement with Charter, with license fees increasing from **$10.0 million** in year one to **$32.3 million** in year ten[109](index=109&type=chunk) - Subsequent to quarter end, on May 5, 2021, the company entered into a new three-year, **$25.0 million** senior secured revolving credit agreement with Bank of America[122](index=122&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=23&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses a slight 0.9% increase in total revenue to $90.3 million for Q1 2021, driven by growth in Ratings and Planning and Analytics and Optimization, offset by a sharp decline in Movies Reporting and Analytics due to the COVID-19 pandemic's impact on theaters [Results of Operations](index=23&type=section&id=Results%20of%20Operations) For Q1 2021, total revenue increased by 0.9% to $90.3 million, driven by growth in Ratings and Planning and Analytics and Optimization, while Movies Reporting and Analytics revenue fell due to theater closures Revenue Variance by Solution Group (Q1 2021 vs Q1 2020) | Solution Group | Q1 2021 Revenue (in thousands) | Q1 2020 Revenue (in thousands) | % Variance | | :--- | :--- | :--- | :--- | | Ratings and Planning | $65,806 | $63,521 | +3.6% | | Analytics and Optimization | $17,701 | $15,501 | +14.2% | | Movies Reporting and Analytics | $6,823 | $10,506 | -35.1% | | **Total revenues** | **$90,330** | **$89,528** | **+0.9%** | - Cost of revenues increased by **$6.9 million** (15.1%) YoY, primarily due to a **$3.0 million** increase in data costs for an expanded data footprint and a **$2.4 million** increase in other license costs for European cross-platform products[138](index=138&type=chunk) - General and administrative expenses decreased by **$1.1 million** (6.9%) YoY, driven by a **$1.6 million** reduction in professional fees and a **$1.1 million** decrease in other expenses, partially offset by a **$1.7 million** increase in employee costs[144](index=144&type=chunk) - A **$9.6 million** loss on debt extinguishment was recorded in Q1 2021 from the payoff of senior secured convertible notes and a secured promissory note[147](index=147&type=chunk) [Liquidity and Capital Resources](index=28&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2021, the company held $33.9 million in cash, cash equivalents, and restricted cash, following a significant recapitalization in March 2021 that raised $204.0 million to extinguish existing debt and improve financial position - In March 2021, the company issued and sold shares of Series B Convertible Preferred Stock to Charter, Qurate, and Pine for gross proceeds of **$204.0 million**[160](index=160&type=chunk) - The proceeds from the preferred stock issuance were used to repay the **$204.0 million** in senior secured convertible notes and the **$13.0 million** secured term note[161](index=161&type=chunk)[172](index=172&type=chunk)[174](index=174&type=chunk) Cash Flow Summary (Three Months Ended March 31) | Cash Flow Activity | 2021 ($ thousands) | 2020 ($ thousands) | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $17,888 | ($4,781) | | Net cash used in investing activities | ($3,692) | ($3,917) | | Net cash used in financing activities | ($30,477) | ($549) | - On May 5, 2021, the company entered into a new **$25.0 million** senior secured revolving credit agreement, which was undrawn as of the filing date[167](index=167&type=chunk)[169](index=169&type=chunk) [Critical Accounting Policies](index=31&type=page&id=Critical%20Accounting%20Policies) The company highlights new critical accounting policies related to the March 2021 financial restructuring, including the classification of newly issued Series B Convertible Preferred Stock as mezzanine equity and the early adoption of ASU 2020-06 - The newly issued Preferred Stock is classified as mezzanine equity on the balance sheet because it is contingently redeemable upon events like a change of control, which are outside the company's control[190](index=190&type=chunk) - The company early-adopted ASU 2020-06, simplifying the accounting for convertible instruments, with no embedded features requiring bifurcation except for the change of control redemption feature[192](index=192&type=chunk)[193](index=193&type=chunk) - The company applied ASC 470, Debt, to account for the repayment of its debt, recognizing a **$9.6 million** loss on extinguishment in Q1 2021[194](index=194&type=chunk)[195](index=195&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=32&type=page&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company identifies two primary market risks: warrants liability, sensitive to common stock price changes, and foreign currency risk from global operations - The company is subject to market risk from its outstanding warrants liability, which was valued at **$12.8 million** as of March 31, 2021[197](index=197&type=chunk) - A 10% increase or decrease in the company's common stock price would result in a corresponding **$1.7 million** increase or decrease in the fair value of the Series A Warrants[198](index=198&type=chunk) [Item 4. Controls and Procedures](index=33&type=page&id=Item%204.%20Controls%20and%20Procedures) As of March 31, 2021, the company's principal executive officer and principal financial officer concluded that disclosure controls and procedures were effective, with no material changes to internal control over financial reporting during the quarter - Management, including the CEO and CFO, concluded that as of March 31, 2021, the company's disclosure controls and procedures were effective[201](index=201&type=chunk) - No material changes to the company's internal control over financial reporting occurred during the first quarter of 2021[202](index=202&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=34&type=page&id=Item%201.%20Legal%20Proceedings) The company reports on a privacy class action lawsuit (Rushing, et al v. The Walt Disney Company, et al.) where a settlement was reached and received final court approval on April 12, 2021 - The company reached a settlement in the Rushing, et al v. The Walt Disney Company, et al. privacy class action lawsuit, which received final court approval on April 12, 2021[118](index=118&type=chunk)[206](index=206&type=chunk) [Item 1A. Risk Factors](index=34&type=page&id=Item%201A.%20Risk%20Factors) The company highlights a new risk factor concerning the planned implementation of a new enterprise resource planning (ERP) system in the second half of 2021, which could adversely affect financial reporting and business operations - A new risk factor has been identified related to the implementation of a new enterprise resource planning (ERP) system planned for the second half of 2021[208](index=208&type=chunk) - Potential issues with the ERP implementation include delays, errors, and disruptions that could impair financial reporting, distract management, and negatively impact the business[208](index=208&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=34&type=page&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) On January 25, 2021, the company issued 2,802,454 shares of its common stock as a payment-in-kind for $6.1 million in interest due on its senior secured convertible notes, an unregistered sale under Section 4(a)(2) of the Securities Act - On January 25, 2021, the company issued **2,802,454 shares** of common stock in lieu of a **$6.1 million** cash interest payment on its notes[209](index=209&type=chunk) [Item 5. Other Information](index=35&type=page&id=Item%205.%20Other%20Information) On May 5, 2021, the company entered into a new three-year senior secured revolving credit agreement with Bank of America, providing a borrowing capacity of $25.0 million and including financial covenants effective at future dates - On May 5, 2021, the company entered into a new three-year, **$25.0 million** senior secured revolving credit agreement[214](index=214&type=chunk)[215](index=215&type=chunk) - The credit agreement includes financial covenants for minimum Consolidated EBITDA (starting before June 30, 2022) and a minimum Fixed Charge Coverage Ratio (starting on or after June 30, 2022)[218](index=218&type=chunk)[219](index=219&type=chunk) [Item 6. Exhibits](index=36&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including corporate governance documents, agreements related to the recent preferred stock issuance and data license agreement, and officer certifications
comScore(SCOR) - 2020 Q4 - Earnings Call Transcript
2021-03-10 17:51
Financial Data and Key Metrics Changes - The company reported fourth quarter revenue of $90 million, down from $95.2 million in the same quarter last year [32] - Adjusted EBITDA for the fourth quarter was $9.4 million, compared to $5.5 million for the same period last year, with a full year adjusted EBITDA of over $32 million in 2020, up from $6 million in 2019 [42][12] - The net loss for the fourth quarter was $13.2 million, an improvement from a net loss of $21.4 million in the same period last year [42] Business Line Data and Key Metrics Changes - Revenue from ratings and planning in the fourth quarter was $63.6 million, down from $66.8 million year-over-year, primarily due to declines in syndicated digital products [33] - Analytics and optimization revenue increased to $19.3 million from $17.7 million year-over-year, driven by higher custom digital marketing solutions revenue [34] - Movies reporting and analytics revenue fell to $7.1 million from $10.7 million in the prior year, impacted by ongoing theater closures [36] Market Data and Key Metrics Changes - The company noted that its international digital services, which represent about 25% of its syndicated digital services, were harder hit by COVID-19 but are expected to resume growth later in 2021 [11] - The connected TV business is gaining momentum, with advertising agency clients increasingly embracing advanced audience metrics [9] Company Strategy and Development Direction - The company aims to eliminate outstanding debt and invest in next-generation products with the support of new strategic investors [4] - Focus on privacy-safe measurement and preparation for a cookieless world, leveraging predictive audience solutions [14][16] - Expansion into international markets is strategic, with a focus on profitability and partnerships with large tech companies [110] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about revenue growth in 2021, expecting a 3% to 5% increase, particularly in the second half of the year [45] - The first quarter of 2021 is expected to be impacted by lower movie revenue, but improvements are anticipated as the year progresses [46] - Management highlighted the importance of partnerships in the connected TV space and the competitive landscape [58] Other Important Information - The company ended the fourth quarter with total cash of $50.7 million, down from $66.8 million at the end of 2019, primarily due to cash interest payments [43] - A non-cash charge related to debt extinguishment and associated derivatives is expected in the first quarter, estimated between $15 million and $25 million [49] Q&A Session Summary Question: Investment spend and product roadmap - Management indicated that investments will focus on leveraging existing data sets to create new products, with progress already made in 2020 [54][56] Question: Importance of partnerships in connected TV - Management emphasized that partnerships are crucial for effective advertising and data integration, and they do not need to own everything to succeed [58] Question: 2021 margin guidance - Management expects margins to improve throughout the year, with revenue growth leading to margin expansion by the end of 2021 [63] Question: Movie revenue recovery - Management believes movie revenue will bottom out in the first quarter, with expectations for recovery as theaters reopen [37][46] Question: Approach to declining payments to MVPDs - Management stated that customers use multiple measurement sources, and the company is well-positioned to capitalize on its census measurement approach [88] Question: Preparing for risks of email-based IDs - Management has been preparing for changes in the advertising landscape since 2019 and believes they are in a strong position to adapt [94]