Company Announcement

No. 1/2018

Copenhagen, 5 November 2018


This announcement does not constitute a prospectus and nothing herein contains an offering of securities. No one should purchase or subscribe for any securities in Adform A/S ("Adform" or the "Company") except on the basis of information in any prospectus published by the Company in connection with the potential offering and admission of such securities to trading and official listing on Nasdaq Copenhagen A/S (“Nasdaq Copenhagen”). Copies of any such prospectus will, following publication, be available at the Company’s registered office and, subject to certain exceptions, through the website of the Company.

Adform announces intention to launch an Initial Public Offering on Nasdaq Copenhagen

Adform, an advertising technology company, today announced its intention to launch an Initial Public Offering ("IPO") and to list its shares on Nasdaq Copenhagen.

The contemplated IPO is expected to consist of sale of newly issued shares, to raise gross proceeds of DKK 750 million to support Adform’s strategy by funding its strategic initiatives and strengthening its balance sheet, as well as a potential sale of existing shares by certain of the current shareholders in Adform. The total offer size will be announced in connection with the publication of the prospectus.

Adform is currently owned by GCM Holding ApS, VIA Equity Fond I K/S, Accredonet Holding ApS, Stefan Juricic (collectively the "Selling Shareholders") and Danica Pension, Livsforsikringsaktieselskab.

Chairman of the board of directors, Peter L. Ravn, said:
“We are investing in accelerating Adform’s growth on several dimensions and intend to seek funding of the rapid market expansion, continued product development and a strengthening of our balance sheet through an initial public offering. It is our firm belief, that Adform’s multiple growth levers, business model, and high-growth markets constitute an interesting investment opportunity for new investors."

CEO, Gustav Mellentin, said:
“Since Jakob, Stefan and I founded Adform 16 years ago, we have focused on building a unique product portfolio for lead-ing customers, while driving towards sustainable, long term growth.

It’s been quite a journey from a basement in Nørrebro, Copenhagen to today having more than 850 fantastic colleagues across 24 countries, but I am convinced the most exciting times are still ahead of us. We have ambitious goals for the fu-ture, and we believe that our unique proposition forms a solid foundation for future growth. I am thrilled by the prospect of inviting new shareholders along for Adform’s continued successful journey.”

Information about Adform

Adform is an advertising technology company established in Copenhagen in 2002 by Gustav Mellentin, Jakob Toftgaard Bak and Stefan Juricic (the “Founders”). Adform's main business is, in essence, to provide the software systems that buyers and sellers of digital display advertising use to automate and optimise their advertising processes.

Adform’s software platform consists of a number of individual products that each plays a role in the process. These products are organised into two suites: Advertiser Edge for the Buy Side (i.e. customers buying ad inventory, such as advertisers and agencies) and Publisher Edge for the Sell Side (i.e. customers selling ad inventory, such as publishers). For the first nine months of 2018, Adform’s Buy Side revenue category accounted for 84% of total revenue, whereas the Sell Side revenue category accounted for 16%.

The products in Advertiser Edge allow buy-side customers to engage in bidding for advertising space and to serve the right ads to a user’s browser based on a variety of real time data sources as well as machine learning algorithms and artificial intelligence. Similarly, Publisher Edge allows sell-side customers to sell ad inventory via real-time auctioning and to display the ads into dedicated placements on the publisher’s web page. The underlying, individual products offer additional benefits when used as a suite, but are interoperable with other industry solutions and, hence, also compete on an individual basis.

More than 10 years ago, Adform started solidifying its footprint across the Nordic region, which was soon after followed by expansion into the rest of Europe and recently beyond the European continent. As at 30 September 2018, Adform has a presence in 15 countries in Europe as well as entry positions in the U.S., Turkey, Singapore, China, Australia, United Arab Emirates (Dubai) and India. For the first nine months of 2018, 38% of revenue was generated in the Nordic region and 62% in the International region (i.e. outside the Nordic region).

Adform has grown its organisation to 866 employees as at 30 September 2018. While headquartered in Copenhagen, the majority of the employees are located in Adform’s offices in Central Eastern Europe.

Key financials

In the financial year ended 31 December 2017, Adform generated EUR 59.5 million in revenue, growing 19% compared to 2016, and realised EUR 6.0 million in EBITDA (non-IFRS), corresponding to an EBITDA margin (non-IFRS) of 10.1%. Gross billings (non-IFRS) were EUR 255.6 million in the financial year ended 31 December 2017 compared to EUR 184.0 million for 2016, corresponding to a growth rate of 39%.

Revenue for the first nine months of 2018 was EUR 47.1 million, an increase of 16% compared to the same period in 2017, and Adform realised EUR -0.8 million in EBITDA (non-IFRS), corresponding to an EBITDA margin (non-IFRS) of -1.6% reflecting the Company’s continued investment into global growth and product leadership. Excluding incurred IPO costs and share-based payments, Adform’s EBITDA (non-IFRS) would be EUR 2.5 million in the first nine months of 2018, corresponding to an EBITDA-margin (non-IFRS) of 5.3%.

The table below summarises key financials for the nine months ended on 30 September 2018 and 2017 as well as for the financial years 2015-2017.


As at and for the nine months ended 30 September
As at and for the financial year ended 31 December
KEY FIGURES (EUR million) 2018 2017 2017 2016 2015
Gross billings (non-IFRS)1 221.5 173.0 255.6 184.0 115.4
Gross billings growth (non-IFRS)2 28.0% 46.3% 38.9% 59.4%  -
Revenue 47.1 40.5 59.5 50.0 40.6
Revenue growth 16.2% 23.6% 18.9% 23.4%  -
EBITDA (non-IFRS)3 -0.8 0.9 6.0 1.3 2.2
EBITDA margin (non-IFRS) -1.6% 2.1% 10.1% 2.6% 5.4%
Operating profit/(loss) (EBIT) -7.7 -4.4 -1.3 -3.8 -0.4
EBIT margin -16.3% -10.8% -2.2% -7.6% -5.4%
Net working capital (non-IFRS)4  -1.2 -5.9 -4.8 1.7 3.5
1) Gross billings include the value of clients' purchase of media through Adform's platform plus platform and other fees. The value of media purchased, not attributable to Adform, is recognised as media costs and netted out from gross billing to revenue.

2) Year over year growth based on Note 1 definition.

3) EBITDA means earnings before interest, taxes, depreciation and amortisation.

4) Net working capital is defined as the sum of trade receivables, receivables related to trading orders and other receivables and prepayments less the sum of trade payables, payables related to trading orders and other payables.

Financial guidance for 2018 and 2019

For the financial year 2018, Adform targets:

  • Revenue in the range of EUR 68.0 million to EUR 69.0 million
  • EBITDA (non-IFRS) in the range of EUR 5.0 million to EUR 6.0 million
  • EBIT in the range of EUR -4.5 million to EUR -3.5 million 

For the financial year 2019, Adform targets:

  • Revenue in the range of EUR 77.5 million to 81.0 million
  • EBITDA (non-IFRS) in the range of EUR -4.5 million to EUR -3.5 million
  • EBIT in the range of EUR -16.0 million to EUR -15.0 million 

The financial guidance for EBITDA (non-IFRS) and EBIT is before share-based payments, effects of IFRS 16 and IPO costs.


Adform aspires to gradually accelerate revenue growth towards doubling the current growth rate in the medium term.

Investments related to the strategic initiatives drive a higher cost base, initially at the expense of profitability. However, as the effects of the initiatives materialise and the business scales, the aspiration is to increase the EBITDA margin to a level around 20% in the medium term. 

Key strengths

Positioned in attractive digital growth segments of large global advertising market
Adform operates within the USD 99bn digital display advertising market, a sub-segment of the USD 543bn global advertising market (2017 forecasts by Zenith). The digital display ad market is forecasted to grow by a CAGR of approximately 13% from 2017 to 2020 (Zenith). In addition to the forecasted growth in the general digital ad display market, Adform may benefit from its positioning in certain growth pockets that are experiencing growth above the digital display ad market, e.g. the mobile display and video ad markets and the markets for data management platforms and programmatic advertising. Furthermore, traditional advertising channels, such as television, radio/audio and out-of-home, are increasingly being digitised and are thereby becoming addressable markets for Adform.

An independent, open platform with a leading product suite
Adform is well positioned to address critical challenges in the advertising market by offering a comprehensive technology platform as opposed to most competitors that provide single-product offerings, so-called point solutions. Adform’s platform approach offers considerable benefits to customers as compared to point solutions, such as improved workflow efficiency, data effectiveness and return on investment. While customers can access individual parts of Adform's platform, by aggregating functionality in one platform, Adform offers a proposition worth more than the sum of its parts.

Growing high-profile and loyal customer base
As at 30 September 2018, Adform had 995 active customers with revenue generation of more than EUR 6,000 within a period of 12 months, which was a net increase of 43% compared to 31 December 2016 and 14% compared to 31 December 2017. The customer base includes many well-reputed multinational advertisers and publishers, including several Fortune 500 companies. In addition, Adform has successfully entered into agreements with all of the six largest global agency groups (or relevant subsidiaries thereof). As more products are deployed by a customer, the value of the relationship increases, and the customer loyalty typically grows, which provides for a customer base with a low customer churn, equalling 5% of revenue in 2017 and even lower for large customers.

Broad European footprint through track record of entering new markets
Adform holds a strong market position in the Nordic region due to the Company’s early-mover status, and Adform is generally well positioned across Europe. Adform has a well-established presence in markets such as Germany, Italy, the Netherlands, Spain and Central and Eastern Europe and the Company has continued its expansion outside Europe into the U.S. and Asia Pacific, and in the future, Adform intends to expand its operations further within Asia Pacific and into Latin America.

Strong and ambitious organisation with technology and customer focus
Adform is a founder-driven organisation with a strong and consistent focus on long-term success. The Founders’ vision for Adform has been pivotal to the Company’s development over the years. In recent years, Adform has hired a number of experienced industry profiles to further strengthen the leadership team and ensure scalability as the Company pursues additional growth opportunities over the coming years. Adform is a technology and customer-focused organisation with the majority of its employees engaged in software development and IT (43% of total employees as at 30 September 2018) as well as customer-centric roles (41% of total employees as at 30 September 2018).

Attractive growth profile with margin expansion potential
Since its establishment, Adform has delivered sustained revenue growth, which has been driven by new product launches, geographical expansion and upselling into the existing customer base. At the same time, Adform has shown a prudent approach to its business by balancing growth and sustainability. Proceeds from established markets and core products have been reinvested into entering new markets and launching new products, allowing Adform to realise continued, strong growth while realising positive EBITDA. In 2017, the contribution margin (defined as local revenue less all local direct costs) was 80% for Nordics and 66% for International. 

Bank syndicate

ABG Sundal Collier Denmark, filial af ABG Sundal Collier ASA, Norge and Danske Bank A/S are acting as Joint Global Coordinators and Joint Bookrunners in the offering and Carnegie Investment Bank, filial af Carnegie Investment Bank AB (publ), Sverige is acting as Joint Bookrunner in the offering and is together with the Joint Global Coordinators the Managers in the offering.

Additional information

For additional information, please contact:

Adform A/S
Gustav Mellentin, CEO     +45 3535 7100

Media enquiries
Point Communications
Hans Bøving                  +45 4075 0333

Jørgen Fischer Ravn       +45 2030 3903

Important notice
This announcement is not an offer to sell or a solicitation of any offer to buy any securities issued by Adform in any jurisdiction where such offer or sale would be unlawful, and the announcement and the information contained herein are not for distribution or release, directly or indirectly, in or into such jurisdictions.

In any member state of the European Economic Area (the "EEA") other than Denmark (each a "Relevant Member State"), that has implemented Directive 2003/71/EC (and amendments thereto, including the Amending Directive 2010/73/EU) this announcement is only addressed to, and is only directed at, investors in that Relevant Member State who fulfil the criteria for exemption from the obligation to publish a prospectus, including qualified investors, within the meaning of the Prospectus Directive as implemented in each such Relevant Member State.

This announcement and the information contained herein are not for distribution in or into the United States of America (including its territories and possessions, any state of the United States of America and the District of Columbia) (the “United States”). This document does not constitute, or form part of, an offer to sell, or a solicitation of an offer to purchase, any securities in the United States. The securities referred to herein have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”) and may not be offered or sold within the United States absent registration or an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. There is no intention to register any securities referred to herein in the United States or to make a public offering of the securities in the United States.

In the United Kingdom, this announcement and any other materials in relation to the securities described herein are only being distributed to, and are only directed at, and any investment or investment activity to which this announcement relates is available only to, and will be engaged in only with persons who are investment professionals falling within article 19(5) or falling within article 49(2)(a) to (d) ("high net worth companies, unincorporated associations, etc."), of the U.K. Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 or other persons to whom such investment or investment activity may lawfully be made available (together, "Relevant Persons"). Persons who are not Relevant Persons should not take any action on the basis of this announcement and should not act or rely on it.

This announcement does not constitute a prospectus and nothing herein contains or should be interpreted to contain an offering of securities. No one should purchase or subscribe for any securities in the Company, except on the basis of information in any prospectus published by the Company in connection with the potential offering and admission of such securities to trading and official listing on Nasdaq Copenhagen. Copies of any such prospectus will, following publication, be available from the Company's registered office and on the website of the Company.

The Managers and their affiliates are acting exclusively for the Company and the Selling Shareholders and no one else in connection with the potential offering. They will not regard any other person as their respective clients in relation to the potential offering and will not be responsible to anyone other than the Company and the Selling Shareholders for providing the protections afforded to their respective clients, nor for providing advice in relation to the potential offering, the contents of this announcement or any transaction, arrangement or other matter referred to herein.

In connection with the potential offering, the Managers and any of their affiliates, acting as investors for their own accounts, may purchase shares and in that capacity may retain, purchase, sell, offer to sell or otherwise deal for their own accounts in such shares and other securities of the Company or related investments in connection with the potential offering or otherwise. Accordingly, references in the prospectus, if published, to the shares being issued, offered, acquired, placed or otherwise dealt in should be read as including any issue or offer to, or acquisition, placing or dealing by, such Joint Bookrunner and any of their affiliates acting as investors for their own accounts. The Managers do not intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligations to do so.

Matters discussed in this announcement may constitute forward-looking statements. Forward-looking statements are statements that are not historical facts and that can be identified by words such as “believe”, “expect”, “anticipate”, “intends”, “estimate”, “will”, “may”, “continue”, “should”, and similar expressions. The forward-looking statements in this announcement are based upon various assumptions, many of which are based, in turn, upon further assumptions. Although the Company believes that these assumptions were reasonable when made, these assumptions are inherently subject to significant known and unknown risks, uncertainties, contingencies and other important factors which are difficult or impossible to predict and are beyond its control. Such risks, uncertainties, contingencies and other important factors could cause actual events to differ materially from the expectations expressed or implied in this announcement by such forward-looking statements.

The information, opinions and forward-looking statements contained in this announcement speak only as at its date and are subject to change without notice.