Born in 2009 from an extraordinary opportunity during the crisis phase of the 2008 recession, leading marketing technology company engage:BDR (ASX:EN1) is the premium advertising marketplace for agencies, desks and brands. The Company has been a quick learner & adaptor and thrived when several were afraid. With industry evolvement, EN1 has daringly been on the forefront, adapting to and influencing the change with total control over its destiny.
Continuing its positive trajectory, the Company recently revealed an operational guidance for 2020 and gave an update pertaining to the current events and environmental challenges that the world is facing.
Let’s deep dive-
Work From Home Strategy- 95% Remote Workers
Currently, 95% employees are working remotely after the Company deployed an optional remote working strategy for all employees. Further, access to all systems and software via company VPN have been enabled.
It should be noted here that EN1’s technologies are fully automated & AI-driven and the infrastructure of its platforms and technologies is cloud-based. This translates that people are not required or necessary to be physically present in one location.
What’s interesting is that there has been no interruption/ negative impact on the business with none expected due to the remote work strategy. EN1 has a history of generating seven-figures (USD) in revenue before it considered leasing office space.
In the last 11 years, the majority of the staff have been enabled to work remotely. The self-reliant cloud is owned, operated by EN1 itself. The Company uses battle-tested remote productivity technologies like zoom, G Suite, slack, Jira, Grasshopper, to name a few.
Operational Advances- Past Week Revenue Up by 19%
As reported on 16 March 2020, EN1’s daily revenue has increased by 19% (and 11% in the past 24 hours). The Ad inventory has been up by 9% (in the past 24 hours). Moreover, no clients have cancelled campaigns or lowered spends (throttled), and EN1 has not witnessed any adverse impact recently (in 2020).
The above demonstrates that the strong advertiser demand is out-pacing inventory growth. Consequently, EN1’s management anticipates that ad inventory will continue to grow in mobile apps and CTV.
There is an interesting connection here- as people work from home, app and CTV traffic are likely to grow aggressively. The advertiser demand has risen within the e-commerce category with online purchases significantly increasing. Therefore, advertisers with e-commerce channels are likely to increase spending and have lifted ad budgets as work from home gains traction.
Short-Term Guidance- Upward Growth Curve
EN1 is expecting consistent monthly and quarterly revenue growth and eventually, a significant revenue boost over 2019. The Company conveyed the below guidance, which seems to be reasonable as near-term expectations-
- March 2020 is likely to report continued monthly revenue growth, outshining February’s result by $500K or 30% better and remain EBITDA profitable.
- The Company remains on track to achieving ~3 times the Q12019 result for Q12020.
- Expenses are expected to continue to be reduced on the back of renegotiated contracts with infrastructure providers.
- With ~$1.4 million worth of legacy debt aged over 90 days, EN1 does not expect to currently issue shares to extinguish these liabilities. Management is pursuing on settling these debts.
- The management is assertively working to refinance EN1’s convertible notes facility.
- Audited figures for FY19 are likely to be lodged imminently.
Commenting upon the current events and environmental challenges the world is facing, Executive Chairman and CEO, Mr Ted Dhanik stated-
EN1 last traded at $0.018 up 12.5% on 18 March 2020 (AEDT: 1:57 PM).
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