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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 2, 2024

 

 

AdTheorent Holding Company, Inc.

(Exact name of Registrant as Specified in Its Charter)

 

 

Delaware			001-40116	85-3978415
(State or Other Jurisdiction of Incorporation)			(Commission File Number)	(IRS Employer Identification No.)
330 Hudson Street 13th Floor
New York, New York				10013
(Address of Principal Executive Offices)				(Zip Code)

 

Registrant’s Telephone Number, Including Area Code: (800) 804-1359

 

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common stock, par value $0.0001 per share		ADTH		The Nasdaq Stock Market
Warrants to purchase common stock		ADTHW		The Nasdaq Stock Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 

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Item 2.02 Results of Operations and Financial Condition.

On May 2, 2024, AdTheorent Holding Company, Inc. (the “Company”) released its financial results for the quarter ended March 31, 2024. A copy of the Company’s press release is attached as Exhibit 99.1 to this Form 8-K and incorporated herein by reference.

The information provided in Item 2.02 in this report shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits.

d) Exhibits.

Exhibit No.		Description
99.1		Press release issued by AdTheorent Holding Company, Inc., dated May 2,2024.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Comments in this Current Report on Form 8-K and in the exhibit attached hereto contain certain forward-looking statements, which are based on management’s good faith expectations and beliefs concerning future developments. Actual results may differ materially from these expectations as a result of many factors. These factors include, but are not limited to, the risks and uncertainties described in the “Risk Factors” and “Cautionary Statement Regarding Forward Looking Statements” sections of the Company’s Annual Report on Form 10-K, as well as in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s Quarterly Reports on Form 10-Q. The Company does not undertake any obligation to update such forward-looking statements. All market and industry data are based on Company estimates.

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

			AdTheorent Holding Company, Inc.
Date:	May 2, 2024	By:	/s/ James Lawson
			James Lawson Chief Executive Officer

 

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Exhibit 99.1

 

AdTheorent Holding Company, Inc. Reports First Quarter 2024 Financial Results

 

New York, NY — May 2, 2024 — AdTheorent Holding Company, Inc. (Nasdaq: ADTH) (“AdTheorent” or “the Company”), a machine learning pioneer and industry leader using privacy-forward solutions to deliver measurable value for programmatic advertisers, today announced its first quarter 2024 financial results.

First Quarter 2024 Financial Overview:

Business and Operating Highlights:

*The Company prepares its consolidated financial statements in accordance with the U.S. generally accepted accounting principles (“GAAP”). Adjusted Gross Profit and Adjusted EBITDA are non-GAAP financial measures. See the supplementary schedules in this press release for a discussion of how the Company defines and calculates these measures and a reconciliation thereof to the most directly comparable GAAP measures.

Transaction with Cadent:

On April 1, 2024, the Company announced its entry into a definitive agreement to be acquired by Cadent, LLC for approximately $324 million in cash, or $3.21 per share (the “Merger”). The Merger is expected to be completed by the third quarter of 2024 and is subject to approval by AdTheorent’s stockholders, expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as well as other customary closing conditions. Upon completion of the Merger, AdTheorent common stock will no longer be listed on the Nasdaq Stock Exchange or trade in any other public market. A press release describing the details of the

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Merger can be found on the investor relations page of AdTheorent’s website at investors.adtheorent.com. Due to the pending Merger, AdTheorent will not provide updated guidance or host a conference call or webcast to discuss first quarter 2024 results.

About AdTheorent:

AdTheorent uses advanced machine learning technology and privacy-forward solutions to deliver impactful advertising campaigns for marketers. AdTheorent's advanced machine learning-powered media buying platform powers its predictive targeting, predictive audiences, geo-intelligence, audience extension solutions and in-house creative capability, Studio A\T. Focused on the predictive value of machine learning models, AdTheorent's product suite and flexible transaction models allow advertisers to identify the most qualified potential consumers coupled with the optimal creative experience to deliver superior results, measured by each advertiser's real-world business goals. AdTheorent is headquartered in New York, with fourteen locations across the United States and Canada.

AdTheorent is consistently recognized with numerous technology, product, growth and workplace awards. AdTheorent was named “Best Buy-Side Programmatic Platform” in the 2023 Digiday Technology Awards and was honored with an AI Breakthrough Award and “Most Innovative Product” (B.I.G. Innovation Awards) for six consecutive years. Additionally, AdTheorent is the only seven-time recipient of Frost & Sullivan's “Digital Advertising Leadership Award.” In September 2023, evidencing its continued prioritization of its team, AdTheorent was named a Crain’s Top 100 Best Place to Work in NYC for the tenth consecutive year. AdTheorent ranked tenth in the Large Employer Category and 26th Overall in 2023. For more information, visit adtheorent.com.

 

Forward-Looking Statements:

This communication contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain words such as “believe,” “anticipate,” “expect,” “estimate,” “intend,” “project,” “plan,” or words or phrases with similar meaning. Such statements may also include statements regarding the completion of the proposed merger and the expected timing of the completion of the proposed merger, the management of AdTheorent upon completion of the proposed merger and AdTheorent’s plans upon completion of the proposed merger. Forward-looking statements should not be read as a guarantee of future performance or results and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved. Forward-looking statements contained in this press release relate to, among other things, the Company’s projected financial performance and operating results, including projected revenue, Adjusted Gross Profit and Adjusted EBITDA, as well as statements regarding inflationary pressures and recessionary fears.

 

Forward-looking statements are based on current expectations, forecasts and assumptions that involve risks and uncertainties, including, but not limited to, the market for programmatic advertising developing slower or differently than the Company’s expectations, the demands and expectations of clients and the ability to attract and retain clients and other economic, competitive, governmental and technological factors outside of the Company's control, that may cause the Company's business, strategy or actual results to differ materially from the forward-looking statements. The Company does not intend and undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable law. Investors are referred to AdTheorent's filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K and any subsequent filings on Forms 10-Q or 8-K, for additional information regarding the risks and uncertainties that may cause actual results to differ materially from those expressed in any forward-looking statement.

 

 

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Investor Contact:

David DeStefano, ICR

AdTheorentIR@icrinc.com

(203) 682-8383

 

Press Contact:

Melanie Berger, AdTheorent

Melanie@adtheorent.com

(850) 567-0082

 

 

 

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ADTHEORENT HOLDING COMPANY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands)

 

		March 31,				December 31,
		2024				2023
ASSETS		(unaudited)
Current assets
Cash and cash equivalents		$	69,202			$	70,261
Accounts receivable, net			55,233				71,288
Income tax recoverable			163				177
Prepaid expenses			5,974				4,515
Total current assets			130,572				146,241
Property and equipment, net			437				457
Operating lease right of use assets			4,794				5,085
Investment in SymetryML Holdings			742				628
Other intangible assets, net			8,204				7,969
Goodwill			34,842				34,842
Deferred income taxes, net			11,647				10,575
Other assets			397				299
Total assets		$	191,635			$	206,096
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable		$	13,586			$	17,910
Accrued compensation			3,012				10,483
Accrued expenses			5,442				4,994
Operating lease liabilities, current			1,436				1,421
Total current liabilities			23,476				34,808
Warrants			6,730				967
Seller's Earn-Out			5				10
Operating lease liabilities, non-current			4,779				5,141
Total liabilities			34,990				40,926
Stockholders’ equity
Preferred Stock			—				—
Common Stock			9				9
Additional paid-in capital			94,631				93,304
Retained earnings			62,005				71,857
Total stockholders' equity			156,645				165,170
Total liabilities and stockholders’ equity		$	191,635			$	206,096

 

 

 

 

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ADTHEORENT HOLDING COMPANY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited; in thousands, except share and per share data)

 

		Three Months Ended March 31,
		2024				2023
Revenue		$	34,857			$	32,674
Operating expenses:
Platform operations			20,601				18,387
Sales and marketing			10,862				10,307
Technology and development			3,222				3,291
General and administrative			5,771				3,936
Total operating expenses			40,456				35,921
Loss from operations			(5,599	)			(3,247	)
Interest income, net			646				619
Gain on change in fair value of Seller's Earn-Out			5				233
Loss on change in fair value of warrants			(5,763	)			(269	)
Gain (loss) on fair value of investment in SymetryML Holdings			114				(168	)
Other expense, net			(4	)			(41	)
Total other (loss) income, net			(5,002	)			374
Net loss before income taxes			(10,601	)			(2,873	)
Benefit (provision) for income taxes			749				(2,350	)
Net loss		$	(9,852	)		$	(5,223	)
Loss per share:
Basic		$	(0.11	)		$	(0.06	)
Diluted		$	(0.11	)		$	(0.06	)
Weighted-average common shares outstanding:
Basic			90,449,398				87,551,278
Diluted			90,449,398				87,551,278

 

 

 

 

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ADTHEORENT HOLDING COMPANY, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited; in thousands)

 

		Three Months Ended March 31,
		2024				2023
Cash flows from operating activities
Net loss		$	(9,852	)		$	(5,223	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Provision for credit losses			(200	)			—
Amortization expense			1,403				2,059
Depreciation expense			47				49
Amortization of debt issuance costs			14				14
Gain on change in fair value of Seller's Earn-Out			(5	)			(233	)
Loss on change in fair value of warrants			5,763				269
Loss (gain) on fair value of investment in SymetryML Holdings			(114	)			168
Deferred tax benefit			(1,072	)			(1,326	)
Equity-based compensation			2,041				1,480
Changes in operating assets and liabilities:
Accounts receivable			16,255				16,719
Income taxes recoverable			14				(46	)
Prepaid expenses and other assets			(1,280	)			(1,824	)
Accounts payable			(4,412	)			(572	)
Accrued compensation, accrued expenses, and other liabilities			(7,370	)			(7,423	)
Net cash provided by operating activities			1,232				4,111
Cash flows from investing activities
Capitalized software development costs			(1,448	)			(1,196	)
Purchase of property and equipment			(33	)			(23	)
Net cash used in investing activities			(1,481	)			(1,219	)
Cash flows from financing activities
Cash received for exercised options			238				57
Taxes paid related to net settlement of restricted stock awards			(1,199	)			(399	)
Proceeds from employee stock purchase plan			151				172
Net cash used in financing activities			(810	)			(170	)
Net (decrease) increase in cash and cash equivalents			(1,059	)			2,722
Cash and cash equivalents at beginning of period			70,261				72,579
Cash and cash equivalents at end of period		$	69,202			$	75,301

Non-GAAP Financial Measures

 

The Company uses financial measures that are not calculated in accordance with GAAP including Adjusted EBITDA and Adjusted Gross Profit. The Company's management believes that this information can assist investors in evaluating the Company's operational trends, financial performance, and cash generating capacity and make strategic decisions. Management believes these non-GAAP measures allow investors to evaluate the Company’s financial performance using some of the same measures as management.

 

Because of the limitations associated with these non-GAAP financial measures, “Adjusted Gross Profit,” “EBITDA,” “Adjusted EBITDA,” “Adjusted Gross Profit as a percentage of Revenue” and “Adjusted EBITDA as a percent of Adjusted Gross Profit” should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP. The Company compensates for these limitations by relying primarily on its GAAP results and using non-GAAP measures on a supplemental basis. You should review the reconciliation of the non-GAAP financial measures below and not rely on any single financial measure to evaluate AdTheorent's business.

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The tables below show the Company’s non-GAAP financial metrics reconciled to the comparable GAAP financial metrics included in this release.

Adjusted Gross Profit

Adjusted Gross Profit is a non-GAAP profitability measure. Adjusted Gross Profit is a non-GAAP financial measure of campaign profitability, monitored by management and the board, used to evaluate the Company's operating performance and trends, develop short- and long-term operational plans, and make strategic decisions regarding the allocation of capital. The Company believes this measure provides a useful period-to-period comparison of campaign profitability and is useful information to investors and the market in understanding and evaluating its operating results in the same manner as its management and board. Gross profit is the most comparable GAAP measurement, which is calculated as revenue less platform operations costs. In calculating Adjusted Gross Profit, the Company adds back other platform operations costs, which consist of amortization expense related to capitalized software, depreciation expense, allocated costs of personnel which set up and monitor campaign performance, and platform hosting, license, and maintenance costs, to gross profit.

The following table sets forth a reconciliation of revenue to Adjusted Gross Profit for the periods presented:

 

		Three Months Ended March 31,
		2024				2023
		(In thousands)
Revenue		$	34,857			$	32,674
Less: Platform operations			20,601				18,387
Gross Profit			14,256				14,287
Add back: Other platform operations			8,118				6,610
Adjusted Gross Profit		$	22,374			$	20,897

EBITDA and Adjusted EBITDA

EBITDA is a non-GAAP financial measure defined by the Company as net loss, before interest income, net; depreciation, amortization; and income tax (benefit) provision. Adjusted EBITDA is defined as EBITDA before equity-based compensation expense, transaction costs, non-core operations and other non-recurring items. Net loss is the most comparable GAAP measurement.

Collectively these non-GAAP financial measures are key profitability measures used by the Company's management and board to understand and evaluate its operating performance and trends, develop short-and long-term operational plans and make strategic decisions regarding the allocation of capital. The Company believes that these measures can provide useful period-to-period comparisons of campaign profitability. Accordingly, the Company believes that these measures provide useful information to investors and the market in understanding and evaluating its operating results in the same manner as its management and board.

 

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The following table sets forth a reconciliation of net loss to Adjusted EBITDA for the periods presented:

 

		Three Months Ended March 31,
		2024				2023
		(In thousands)
Net loss		$	(9,852	)		$	(5,223	)
Interest income, net			(646	)			(619	)
Tax (benefit) provision			(749	)			2,350
Depreciation and amortization			1,450				2,108
EBITDA		$	(9,797	)		$	(1,384	)
Equity-based compensation			2,041				1,480
Transaction costs (1)			2,345				166
Gain on change in fair value of Seller's Earn-Out (2)			(5	)			(233	)
Loss on change in fair value of warrants (3)			5,763				269
(Gain) loss on fair value of investment in SymetryML Holdings			(114	)			168
Adjusted EBITDA		$	233			$	466

 

 

The following table presents Adjusted EBITDA as a Percentage of Adjusted Gross Profit and Adjusted Gross Profit as a Percentage of Revenue:

 

		Three Months Ended March 31,
		2024				2023
		(In thousands, except percentages)
Gross Profit		$	14,256			$	14,287
Net loss		$	(9,852	)		$	(5,223	)
Net loss as a percentage of Gross Profit			-69.1	%			-36.6	%
Adjusted Gross Profit		$	22,374			$	20,897
Adjusted EBITDA		$	233			$	466
Adjusted EBITDA as a percentage of Adjusted Gross Profit			1.0	%			2.2	%
Gross Profit		$	14,256			$	14,287
Revenue		$	34,857			$	32,674
Gross Profit as a percentage of Revenue			40.9	%			43.7	%
Revenue		$	34,857			$	32,674
Adjusted Gross Profit		$	22,374			$	20,897
Adjusted Gross Profit as a percentage of Revenue			64.2	%			64.0	%

 

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