Member Info for stt1

I'd add the following to Motley fool's cautions:
1) The Alphonso, data provider, court case, filed last month.
2) The ongoing investigations into GPRD/Privacy and court case againt IAB.
3) CEO selling 1/3 of his holding in Dec
4) Shares on Loan trebling since Dec
5) US Ad tech bubble.

Should You Buy Tremor's Stock After Its Busted IPO?

https://www.fool.com/investing/2021/06/23/should-you-buy-tremors-stock-after-its-busted-ipo/?source=eptyholnk0000202&utm_source=yahoo-host&utm_medium=feed&utm_campaign=article

It hasn't helped PSN.

The reputational damage is far greater than the financial resolution.

Julian
" I think you expected it to continue spiraling down for a long period"

Where did I say that or are you making it up?

Last week the UK sp was over 800p, it fell around 20%. The US & UK prices will follow each other, up or down until there's news.
That is the problem with a dual listing, with AIM being the primary listing.
Investors anxiously looking at the US.

The red flags were obvious (to me). Tosca selling just days before the IPO and Shares on Loan trebling since Dec was a dead giveaway.
Whereas several were expecting a spike on IPO day.

My last trade at around 800p worked out well.

Best to trade than get caught out.

Offer closed today.

In US trmr ended the day down 1.18% at $18.01 eq 651p UK.

US Peers:
Magnite up 4.3%
Pubm up 8.24%
TTD up 5.29%
Perion up 2.98%

I thought the gap compared to US Peers was to going to narrow after IPO.

13.5m offer shares (closed today) being admitted for UK trading tomorrow morning.

https://www.globenewswire.com/news-release/2021/06/22/2251086/0/en/Tremor-International-Ltd-Announces-Closing-of-Offering.html

Krusty,
"It doesn't end next week, but the next phase (the tapered extension) begins and runs until the end of September."

Agree, it tapers off.
Given the avg property price is around £250k, it's as good as ended next week.

"As of April 2021, the average house price in the UK is £250,772, and the index stands at 131.52. Property prices have fallen by 1.9% compared to the previous month, and risen by 8.9% compared to the previous year."

https://landregistry.data.gov.uk/app/ukhpi

Eddie,
"Even if we had $250m to $280m that’s a whopping amount don’t you agree ?"
Ok, thanks for confirming you made the $300m up?

I'm sure readers aren't fools and would be interested to know from the company what they are actually going to do.
Alphonso court case.
Inventory Payments.
M&A.

Given at fy2020 Dec they stated they are retaining cash for working capital, the recent court case filing against Alphonso, I think they need the cash for inventory payments/working capital.

From their fy accounts:
""Net cash from operating activities of $35.2 million (2019: $45.1 million) mainly due to working capital requirements during record H2 and Q4 2020 performance"

"Although the Company have paid dividends and share buybacks in the past, the Company does not anticipate paying any dividends in the foreseeable future. The Company currently intend to retain future earnings, if any, to finance operations and expand its business. "

https://www.tremorinternational.com/wp-content/uploads/2021/03/TRMR-Final-Results-100321.pd

Perhaps the reasoning given when Sizmek filed for Chapter 11 is a more plausible explanation? ie the way ad tech model works.

The ad tech model works by DSPs/SSPs, partnering with each other. It is usually the case that the company would pay their 'supplier' (other ad tech companies) around 60 days but receive their cut from 'customers' (other ad tech companies) around 90 days. That gap("inventory payments") has to be covered from their own cash or they setup credit facilities.

"Brands and agencies often pay DSPs on 90-day or even 120-day cycles. But DSPs pay SSPs between 30 to 60 days."

"DSPs shoulder this burden directly because they constantly owe money to inventory suppliers. The Trade Desk took out a $200 million loan in 2017 to preserve liquidity while it bridges inventory payments. MediaMath has raised more than $600 million, including $225 million last year."

https://adexchanger.com/online-advertising/sizmeks-bankruptcy-is-changing-how-the-supply-side-manages-dsp-debts/

Eddie,
"Ofer must have already had the outline of a plan for the approx. $300m cash that will now be sitting on our balance sheet."

Where did you get $300m from or did you make it up?

Q1 they stated $130m + the placing of $128m BEFORE deducting discounts and commissions.

" for aggregate proceeds of approximately $128.6 million before deducting underwriting discounts and commissions"

https://www.tremorinternational.com/wp-content/uploads/2021/06/TRMR-Closing-Release-220621.pdf


As you know the way inventory payments work, I think they are likely to need the money to pay for inventory. The Trade Desk had to raise $200m just to pay for inventory.

How much does losing Alphonso impact their revenues?

In terms of Unruly, they bought Unruly for 1/3 of revenues and, pre-covid, several M&A were around 1/3 - 1/2 revenues.

The paltry price paid for Unruly rattles the consolidating ad tech market

https://digiday.com/media/paltry-price-paid-unruly-rattles-consolidating-ad-tech-market/#:~:text=Unruly%20generated%20%C2%A343.5%20million,12%20months%20until%20June%2030.

From the link, 13.5m shares to be admitted to AIM from tomorrow morning.

"Application has been made for the 13,537,906 ordinary shares of Tremor underlying the ADSs to be issued in the Offering to be admitted to trading on AIM, and it is expected that admission will become effective and dealings in the ordinary shares will commence at 8:00 a.m. (Greenwich Mean Time) on June 23, 2021."

around 10% dilution.

Tremor International Ltd. Announces Closing of Offering

https://www.globenewswire.com/news-release/2021/06/22/2251086/0/en/Tremor-International-Ltd-Announces-Closing-of-Offering.html

I think the sp is down because the Stamp Duty hol ends next week.

Property transactions are slowing.

"The latest figures released by HMRC have revealed that UK residential property transactions reached 114,940 in May - a 3.9% dip against the previous month, but still 138.2% higher than May 2020.

When non-seasonally adjusted, transactions totalled 103,100 and were 123.4% higher than May 2020 and down 8.7% against April 2021."

https://www.propertyreporter.co.uk/property/looming-stamp-duty-holiday-deadline-sees-residential-property-sales-ease-in-may.html

Bald_eagle
"More likely to be a spotty teenager with a laptop on the dark web."

Exactly, that's the point.

Why CTV fraud is increasing.

The CEO is ex-CEO of Telaria(demerged from Trmr) and formed partnership with Rubicon to form Magnite.
Telaria(now Magnite) demerged from trmr due to 'perceived conflict of interest' - Trmr operate a full stack.

The CMO is ex-COO (Chief Operations Officer) of rthm(now trmr).

Given their previous roles, they would know how ad tech ecosystem works

They say fraud follows the money..

This is what Dan (ex-COO of rthm) and Doubleverify say about adtech fraud within CTV.

Dan Slivjanovski, ex COO/CMO of rthm talks about fraud and transparency within the ad tech ecosystem...

"Trust in an Ad-Supported Internet is Eroding.
Fake news, digital ad fraud, and data privacy are pressing issues threatening the trust and confidence in an ad-supported internet. "

Fraud Follows the Money
"Third-party verification has successfully reduced desktop digital ad fraud to low single digits.
Now, with mobile apps commanding more than 50% of a consumer's time online, advertiser demand for quality mobile inventory has swelled. In return, we've seen an 800% increase of in-app ad fraud. Expect that in-app ad fraud will continue to accelerate as fraud follows the money. Also, expect emerging premium, high-growth media types such as connected TV (CTV) to draw the attention of fraudsters in line with sharp increases in budget allocation."
http://www.adotas.com/2019/01/2019-ad-predictions-cmo-doubleverify/

and more recently:

Doubleverify have discovered more CTV fraud. This is likely to call for another round of calls for transparency and possible pulling back of CTV spending by advertisers, as it did in 2017.

CTV Fraud Scheme Costs up to $50m

"Discovered by digital media measurement and verification platform DoubleVerify, the scheme named ParrotTerra is estimated to have cost advertisers between USD $30m (£21.7m) and USD $50m (£36.1m) in stolen spend."

The fallout from ParrotTerra will no doubt amplify calls for greater transparency across the CTV supply chain, and more comprehensive solutions for tackling bad actors."
https://www.exchangewire.com/blog/2021/02/10/bloomberg-media-aspires-for-100m-from-consumer-subs-ctv-fraud-scheme-costs-up-to-50m/

Telaria (Magnite) reasons for selling their TremorDSP.. perceived conflict of interest

"Clients were also uneasy with Tremor servicing both the buy- and sell-sides."
"There's always been a little bit of friction because we were selling agencies and advertisers different products while we were representing publishers," Zagorski said. "And the people who plug into that sell-side platform would always be somewhat hesitant to commit to it in a huge way because we had that perceived conflict."
https://adexchanger.com/digital-tv/tremor-video-sells-demand-side-business-taptica-50m/

Julian,
The current pre-market is $18.47 which is eq to 668p.
What is the current sp, 668p?

The Uk following the US, following the UK, following the US.

That is a vicious circle.

Until there is news to break the circle.

Ad tech companies have a high dependancy on rtb (Real Time Bidding) or Programmatic.

I think there's severe consequences for ad tech model with this court case, especially if IAB lose.

Programmatic/rtb is heavily used.

IAB Tech Lab sued over its role in â€ËÅ“world’s largest data breach’
https://www.thedrum.com/news/2021/06/17/iab-tech-lab-sued-over-its-role-world-s-largest-data-breach

Tricky
"TLY has dangerously high debt levels - very much overshadowing the so-called huge amounts of cash."

Can you back up that assertion with evidence showing "dangerously high debt level" or are you making it malicious statements?

From their TU from 2 months ago:
"As at 31 March 2021 the Company was in a healthy financial position with £14.8 million of net cash (31 March 2020: £8.9 million). The Company has no debt financing ** and all deferred HMRC payments have been paid in full. "
https://polaris.brighterir.com/public/totally/news/rns/story/xppk83x

Tricky
"Give profits away in dividends for a growth company is not the answer.
TLY should be using the money for, well, growth."

As you well know they had a 'add and build' strategy. During the 'Add' stage, they were using the money to grow.

Now they are in the 'build' stage, they have surplus cash. Their diversified business model has been built, maybe some small ad ons.

It's time for the growth stage.

£14.3m cash is a huge cash amount for a company valued at only £70m.

That's less than their £90-100m revenues.

Eddie,
"whether TLY's medium to longer term fortunes is ever going to significantly benefit from the Covid crises."

The beauty of their diversified business model is that they are NOT covid dependent.
They were growing significantly pre-covid, continued to do so during covid and will continue to do so post covid.

Everyone needs healthcare, covid or not.

Last 5 years:
period revenue, cash, profit/loss
2015 £0.6m, £0.4m, £0.4m
2016 £4m, £1m, £1.4m
2017 £21.3m, £11.3m, £5.6m
2018 £42m, £10.2m, £0.2m
2019 £78m, £7.5m, £1.1m
2020 £105m, £8.9m, £4m
2021E£92.m, £14.8m, substantially above £4m

https://polaris.brighterir.com/public/totally/news/rns/story/xppk83x

Key takeaways from the TU on fy expectations:

Cash £14.8m
Revenue ~£92m
earnings substantially ahead of management expectations and last year's £4m.

Foundation set for growth.
Dividend paying.

Mcap £70m

https://polaris.brighterir.com/public/totally/news/rns/story/xppk83x

It seems to me that there's a distinct lack of interest in US, as can be seen by the discounted placing.

Why did they need a huge placing if they have $130m in the bank?

The offer closes tomorrow.

Bru

"No Q2/H1 results. ----so what give them time."
**********************************************
The last fy audited results shows only 12% increase in revenues, despite the hotly contested US Elections and covid. Plus they include contribution from Unruly (2019 NIL) and rthm (2019 8 months). They also missed expectations.
Presenting just 1 qtr of results doesn't show growth.

Total net revenue increased by only 12% to $184.3 million (2019: $164.0 million). Only $20m!!
Adj Ebitda up only £100k(2019 $60.4m)

These figures include a full year contribution from Unruly(2019 nil) and rthm(fy2019 8 months)
""The Company traded strongly during 2020 as a whole, achieving a 12% increase in net revenues to 184.3 million (2019: $164.0 million), primarily driven by the performance of our Programmatic activities generating an increase of 30% to $161.6 million (2019: $124.2 million) as a result of our strategic shift to focus on our Programmatic activities as a key growth driver""

Check the table in the results - fy2020 inc full year from Unruly & Rthm.

Revenues up ONLY 2%
Net revenues up ONLY 12%
GP up ONLY 10%

https://www.tremorinternational.com/wp-content/uploads/2021/03/TRMR-Final-Results-100321.pdf

Q2 should be significantly higher than Q1, given that Q1 is normally a 'quiet' qtr.

Alphonso court case
********************
They haven't said there is NO impact from losing Alphonso, the data provider?
The impact won't be known for months.

"Shares on Loan increasing. -----means f....allll"
***********************************************
Shares on Loan(sol) trebled since the CEO sold 1/3 of his holding. Tosca selling DAYS before the IPO is questionable.
Who is lending out the shares? Is it Tosca, Mithaq?


"Huge placing. Offer closes Tues"
*********************************
Why do they need a huge placing if they have $130m in the bank. Is it for inventory payments? They did indicate 'working capital' so I think it could be. That raises the question of how much do they owe?

Radium,
Ad tech expenditure has been growing for years.

Rthm(now trmr) were also offering CTV. They were also operating the full stack.

How did that work out?
rthm were also making losses for years.

https://www.rhythmone.com/news/rhythmone-expands-suite-of-smart-tv-impression-units-for-advanced-tv-advertising/

Sizmek
*******
Sizmek filed for Chapter 11 bankruptcy despite providing CTV and being Nasdaq listed.

https://digiday.com/media/tip-ice-berg-sizmek-saga-spells-trouble-ad-tech/

Placing.
Overhang.
Court case.

Best to trade.

we're now in the vicious circle. The problem with the dual listing.

$17.88 on Nas is 647p.

US Peer Pubm down 5%
Magn down 1%