MTMY.L Share News (MTMY)

Less than a year after floating in London, Israeli digital advertising company Matomy Media has issued a profit warning due to a clampdown by ad platforms.The programmatic ad specialist said it expected first half operating profits to end-June will be down roughly 21% on last year to $10m.The decline, it said, was mainly attributable to "comprehensively stricter internal regulations" imposed by various major ad trading platforms, effectively tightening screening to filter out fraudulent and low conversion websites, said broker Canaccord.This widespread clampdown included a leading media trading platform, which was not named by Matomy, introducing a new media verification and screening tool that resulted in an immediate decrease in the amount of digital advertising inventory and this has resulted in an increase in pricing.Matomy also suffered weaker trading across the company in the first quarter but predicted an improvement in the second half. It projected full-year revenues to be in the range of $275m to $285m and earnings before interest, tax, depreciation and amortisation of $26m to $28m, both still below forecast however.Canaccord noted that this still assumed "a significant step up" in second-half EBITDA, given the projected $10m profit in the first half."Ultimately, the tightening up of these exchanges/platforms should improve the quality of digital media available (ie screen out fraudulent and low conversion sites). But the negative short term impact is material and highlights some of the risks of operating within a fast-growing but rapidly evolving advertising technology market," wrote analyst Simon Davies.With underlying growth, particularly within the mobile, video and social channels remaining strong and the recent acquisition of email marketing business Avenlo broadened the range of revenue.