Audioboom narrows loss and reaches cash flow breakeven

Podcasting company Audioboom reported a 92% improvement in revenue in its final results on Friday, to $11.7m, reporting “significant” growth in the final three months of the period.

The AIM-traded firm said its adjusted EBITDA loss narrowed to $5.1m in the 13 months ended 31 December, from $5.6m in the 12 months ended 30 November 2017, with that metric also seeing “much improved” performance in the final three months of the period.

Group cash as at 31 December stood at $1.6m, rising from $1m year-on-year, with operating cash flow breakeven achieved in the final three months of the 13 months.

Audioboom’s key performance indicators all delivered significant growth, with the board noting revenue per 1,000 listens in the US increased to $25.87 in December, up 74% from $14.87 in November 2017.

It had a brand advertiser count of 160 as at period end, up 65% from the 97 it counted in November 2017, with new tier one advertisers including Bose and TiVo.

Total available premium advertising impressions grew to a total of 1.02 billion in the 2018 financial period, up from 671 million in 2017, which made for an increase of 51%.

The company said its focus was on working with the most prominent podcasts, which was demonstrated with notable new content including a multi-year contract for 'Casefile', a popular true crime podcast; and 'And That's Why We Drink', one of the biggest new podcasts of 2018.

It also saw the re-signing of 'No Such Thing As A Fish' and 'The Totally Football Show', two of the UK's biggest podcasts by listens.

Co-production partnerships were established with leading existing brands and broadcasters, including 'Beyond the Grid' with Formula One, to enhance gross margins.

Traction and growth for the ‘Audioboom Original Network’ (AON) continued, with 11 shows produced from the group's New York and London studios, creating original intellectual property and generating higher margins than third party podcasts.

The year also saw the successful launch of ‘Sonic Influencer Marketing’, which the board described as a platform which enabled brands to secure advertising within any globally available podcast.

Audioboom completed Spotify API integration, a sales agreement with Starburns Audio, a new podcasting network created by Starburns Industries, and an international sales partnership agreement with The Podcast Exchange in Canada, it added.

Finally, it withdrew from the proposed reverse acquisition of Triton Digital Canada, a technology provider to the online audio industry when - despite significant demand - it was not possible to complete the associated fundraise.

Since the period ended, Audioboom said its key performance indicators for the first quarter of 2019 all demonstrated further significant growth over the prior year.

It said it was trading ahead of management expectations, with record quarterly revenue of$4.6m, up 180% on the first quarter of 2018.

The company’s brand advertiser count stood at 178 as at 31 March, which was up 55% year-on-year, while its revenue per 1,000 listens in the US was $23.77, which was ahead 67% on the same quarter a year ago.

That was, however, lower than the fourth quarter of 2018 due to higher inventory being available in the first quarter of 2019.

Total available premium advertising impressions were 305 million, which was up 28% from the same time last year.

Also since the end of the 2018 financial period, Audioboom said it had raised a total of £4.3m before expenses from a placing and subscriptions to secure leading podcasting talent and shows, and develop co-production and AON opportunities which were expected to further improve the group's performance over the course of 2019 and beyond.

It said it was looking at a “strong” pipeline of high revenue-producing podcast content and talent, and other opportunities, and explained that ongoing cost control was continuing as it recognised the reduction and repurposing of headcount costs and the savings made from renegotiated hosting, bandwidth and ad serving costs.

“I am delighted the significant investments we've made in people and technology over the past couple of years have been reflected in these financial results with revenue increasing 92% for the period and the company achieving cash flow break-even over the final three months,” said Audioboom chief executive officer Rob Proctor.

“We signed some impressive new content during the period, including 'Casefile', 'And That's Why We Drink' and also re-signed two of the UK's biggest podcasts, by number of listens.

“I am particularly pleased with the success of our Audioboom Originals Network programming with both the London and New York studios creating more than 11 shows, which expands our operating margins and creates valuable intellectual property for the company.”

Proctor said the entire audio entertainment industry was already beginning to value intellectual property within the sector, adding that the sector had already seen several large industry players such as Spotify acquiring podcasting businesses over the last 12 months and Luminary, a podcast startup, raise $100m.

“The recent successful placing and subscription for new shares in the company positions us well to acquire even more talent and valuable third-party podcasts to both maintain our leading market position across the United States and Europe, and drive further material revenue growth this year.”