Dianomi Regulatory News (DNM)

18 July 2022

Dianomi plc

("Dianomi", the "Company" or the "Group")

Trading Update

Encouraging H1 performance. Strong pipeline of opportunities with revenues for the full year expected to be broadly in line with market expectations.

Dianomi, a leading provider of native digital advertising services to premium clients in the Business, Finance and Lifestyle sectors, is pleased to announce the following trading update for the first six months to 30 June 2022.

The Group has delivered a good first half, with revenues expected to be up 4% against a particularly strong comparative period last year, despite a negative macro environment. Both the advertiser and publisher base have expanded so far in 2022, including the successful rollout of the contract with CNN Business, which, even though it is yet to be fully implemented, is already a top 5 publisher. Whilst it is too early to determine with certainty, the Company still currently expects revenues for the full year to be broadly in line with market expectations.

There are significant prospective publisher contracts being pursued, representing a solid pipeline of new business. The business is reliant on closing new contracts in the pipeline within expected timeframes to deliver its second half growth expectations, and whilst the timing to convert these opportunities varies, there are several opportunities being pursued which provides confidence in the outlook.

In Q2, some advertisers spent more cautiously; however, historical patterns consistently show trading to be weighted to the second half of the year for both native and video campaigns, although there remains a risk that weaker advertising spend persists. Trials are underway amongst new advertisers across contextual and programmatic channels. Whilst the programmatic platform is nascent, early results are encouraging and it is expected that increased revenue will be generated through this solution in the second half of the year. Video campaigns represent another growth area which generates ad hoc income but can be significant, and a number of conversations with key advertisers with video demand are ongoing.

The Group made investments in FY21 and in the first half of year to support future growth, including the roll-out of Dianomi's contextually-led programmatic platform. These investments were predominantly in marketing and people, including a new Head of Programmatic. However, these investments as well as the additional costs associated with being a public company, have contributed to a decrease in Adjusted EBITDA* margin from 10% for the six months to June 2021 to approximately 5% for the six months to 30 June 2022. Adjusted EBITDA* margin is expected to improve in the second half of the year. Unaudited cash at 30 June 2022 was £10.4 million.

Rupert Hodson, Chief Executive Officer of Dianomi, said:

"Given our significant growth in 2020 and 2021 and the uncertain macro environment, we are encouraged by the Group's performance in the first half of the year.

"With the investments made in future growth, as well as healthy pipelines and historical track record, Dianomi is well placed going into the second half of the year, and we are optimistic for a solid result for the year. In the medium term, the market opportunities for the Group are expanding significantly, as the advertising world adjusts to a cookie-less environment and increasing numbers of potential clients reassess the power and accuracy of contextual solutions."

* Adjusted EBITDA is calculated as profit after tax before deducting net finance costs, tax, depreciation, exceptional items and share based payment charges

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. It forms part of United Kingdom domestic law by virtue of the European Union (Withdrawal) Act 2018. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

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About Dianomi

Dianomi, established in 2003, is a leading provider of native digital advertising services to premium clients in the Business, Finance and Lifestyle sectors. The Group operates from its offices in London, New York and Sydney. The Group enables premium brands to deliver native advertisements to a targeted audience on the desktop and mobile websites, mobile and tablet applications of premium publishers. It provides over 400 advertisers, including blue chip names such as abrdn, Invesco and Baillie Gifford, with access to an international audience of over 500 million devices per month through its partnerships with over 300 premium publishers, including blue chip names such as Reuters, CNN Business, Bloomberg and WSJ. Adverts served are contextually relevant to the content of the webpages on which they appear and mirror the style of the page, which enhances reader engagement. http://www.dianomi.com.