9th Oct 2015 07:10
LONDON (Alliance News) - Adgorithms Ltd Friday said earnings for the full year will be materially below expectations following disruption in the online advertising market.
Shares in Adgorithms were down 56% at 55.00 pence Friday morning shortly after market open, the biggest faller on AIM.
The advertising software company said the online advertising market has experienced severe disruption in recent weeks which has resulted in a loss of supply for major online advertising exchanges and a drop in demand from major media buyers.
This had a "significant effect" on indirect revenue generation, Adgorithms said, and is expected to continue to do so in the near term. Full-year earnings will miss market expectations as a result.
"However, the board believes that although these developments affect financial performance in the near term, they strongly emphasise the market need for the company's SaaS solution and will expedite the company's direct sales and adoption of its SaaS solution by advertisers. Adgorithms' proprietary software platform, Albert, can enable brands to place online adverts directly, increasing transparency, marketing effectiveness and return on investment," Adgorithms said.
The company added that Exit Electronics Ltd has engaged Adgorithms for the use of its SaaS platform. Exit Electronics is the sole distributor in Israel for Hisense Co Ltd, which is a Chinese consumer electronics company. The engagement will commence with the launch of Hisense's new flagship products during the Black Friday weekend sale in November.
"Management remain focused on converting a strong pipeline of SaaS opportunities into profitable contracts over the coming months. The company's board of directors remain confident in the overall long-term growth prospects of the business," Adgorithms said.
By Karolina Kaminska; [email protected] @KarolinaAllNews
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