LONDON (Alliance News) - Matomy Media Group PLC Tuesday said it is currently trading in line with expectations in 2015, as it posted a fall in pretax profit for 2014 due to higher operating costs and listing expenses offsetting a rise in revenue.
The digital advertising firm posted a pretax profit of USD4.6 million, down from USD8.8 million in 2013, as a rise in revenue to USD237.4 million from USD193.5 million was offset by higher cost of sales and operating expenses.
Matomy said its strongest growth was in North and South America where revenue was up 29%, driven by video advertising revenues, and the introduction of new products including email marketing.
After a challenging first half in Europe, particularly in Spain where a change in user registration requirements by some mobile operators hampered its activity, revenues rebounded in the second half taking total revenue growth in the region for 2014 to 7%.
However, the company's gross margin fell to 25% from 27%, as increased activity in social media advertising led to higher direct media costs, it said.
Operating expenses rose 20%, as a result of costs from acquiring a controlling stake in direct search navigation and domain monetisation business Team Internet last June, and MobAff LLC in 2013, costs relating to its listing on the London Stock Exchange.
Matomy listed last July, after having initially planned to list last March, however it had had to delay the listing as at the time it was not able to meet premium listing rules that require 25% of the shares in issue to be held by investors within the European Economic area.
"During 2014 we made significant strides towards achieving our goal of becoming the recognised global leader in digital performance-based advertising. Through strategic acquisitions and partnerships, as well as investment in our core growth activities of mobile, social and video advertising, and in other areas of the business, we have laid a solid foundation to pursue this important goal," said Chief Executive Officer Ofer Druker in a statement.
"These business developments, together with the planned additional investments in 2015 in our media capabilities, partnerships and acquisitions, will strengthen our market position and drive our long-term profitability and sustainable growth," Druker added.
Shares in Matomy are trading up 1.7% at 209.05 pence Tuesday morning.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
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