DMS Announces Q3 2021 Results
- Record quarterly revenue of $107.4 million and also record adjusted revenue of $111.8 million
- Revenue growth of 30% and organic revenue growth of 11% from the year-ago period
- Net income of $5.4 million and adjusted EBITDA of $11 million
- Variable marketing margin (VMM) of $37.9 million, or 35%
- Reiterating prior 2021 guidance on revenues, EBITDA, gross margins and VMM margins
Clearwater, FL -- November 9, 2021 -- Digital Media Solutions, Inc. (NYSE: DMS), a leading provider of technology-enabled digital performance advertising solutions connecting consumers and advertisers, today announced record third quarter revenue of $107.4 million and adjusted revenue of $111.8 million.
“We are pleased to have reported a record revenue quarter for DMS,” stated Joe Marinucci, CEO of DMS. “And, I’m happy to say that diversification helped us continue to deliver top-line growth in this quarter, especially in our largest sector of insurance. In fact, total revenue was up 30% on a reported basis over the year-ago quarter.”
Q3 2021 Performance:
Total revenue was $107.4 million, up 30% over the same quarter last year. Adjusted revenue was $111.8 million, an increase of 31% year over year. Gross profit was $31 million, with a 29% margin, compared to 32% in Q2 and 30% in the year-ago quarter. VMM of 35% in Q3, compares to 38% in Q2 2021 and 35% in Q3 2020.
Operating expenses totaled $26 million in the third quarter, a decrease of $3 million from Q2 2021 and an increase of $2 million year over year. Net income was $5.4 million, up from $4.1 million in the same quarter last year. EPS came in at $0.10 as compared to $0.09 in Q3 of the prior year.
On a segment basis, excluding intracompany revenue, Brand-Direct Solutions generated revenue of $65 million, up 32% over the same quarter last year. Gross margin was 23%, down from 26% in Q2 2021, and flat versus the same quarter last year.
Marketplace Solutions generated Q3 revenue of $58 million, up 47% over the same quarter last year. Gross margin was 25%, down from 29% in Q2 2021, and down from 30% in the year ago quarter.
The Other Solutions segment generated revenue of $2 million, down 22% compared to Q3 2020. Gross margin was 72%, compared to 76% in the prior quarter and 64% in Q3 of the prior year.
We ended the quarter with $18.7 million in cash, cash equivalents and marketable securities, flat from the end of Q2, reflecting normal shifts in working capital. Our total debt at quarter end was $224 million, and net of issuance costs, it was $218 million, and we had an available balance on our revolving credit facility of $50 million. Lastly, Q3 ended with a total headcount of 600 FTEs.
Fourth Quarter and Full-Year 2021 Guidance:
Thanks to the diversification, vertical integration and culture of continuous innovation, the Company believes it is well-positioned for Q4. DMS currently anticipates revenue, adjusted revenue, gross margin, variable marketing margin, and adjusted EBITDA ranges as follows:
Fourth Quarter 2021:
- Revenue: $112-$122 million
- Adjusted Revenue: $116-$126 million
- Gross Margin: 28-31%
- Variable Marketing Margin: 32-36%.
- Adjusted EBITDA: $16.5-$19.5 million
Full-Year 2021:
- Revenue: $421 - $431 million
- Adjusted Revenue: $437 - $447 million
- Adjusted EBITDA: $60 - $63 million
Third-Quarter Earnings Call Details
The Company will hold a conference call to discuss these results at 8:30 a.m. (Eastern Time) today, November 9, 2021.
The U.S. toll free dial-in for the conference call is 1-844-200-6205, and the international dial-in number is 1-929-526-1599. The access code is 898038. A live webcast of the conference call will be available on the investor relations page of the Company's website at https://investors.digitalmediasolutions.com.
A replay will be available after the conclusion of the call through November 16, 2021. The U.S. toll-free replay dial-in number is 1-866-813-9403, and the international replay dial-in number is 1-929-458-6194. The replay access code is 688744.
Read the full press release, here.