Financial Overview

Overview
The number of advertisers Bidstack work with has grown to over 70 (FY20: 35) and the portfolio of game titles has risen to 58. The campaigns are evolving from test spends to recurring campaign spend in multiple markets. The business has also witnessed a significant increase in the visibility of its pipeline as the fundamentals of the business have matured.

This culminated in the transformational agreements announced towards the end of 2021 where we first secured a global leader in digital interactive entertainment’s AAA mobile portfolio across multiple formats, including exclusivity for one of its biggest sporting franchises, and, second, a $30m revenue guarantee for 2 years commencing 1 March 2022. These are significant transactions for the whole of the emerging in- game advertising industry, not just for Bidstack.

Trading
In 2021, Bidstack delivered revenue of £2.6m (FY20: £1.7m) which grew by 55%. More importantly, the business has focussed on converting higher margin transactions during the year. The significant increase in Bidstack’s gross margin to 36% (FY20: 13%) is testament to the great work undertaken by the commercial teams.

Gross revenue and gross margin

The transition from test spend to “on-plan” campaign spend is a positive mix driver which has also improved the quality of revenue. This is reflected in the growth of both of our core markets with the US growing 116% year on year and EMEA by 36%, compared to 2020.

The headline operating expenses (excluding exceptional items) of £8.7m (FY20: £7.2m) grew by 20% year on year. The increase is primarily driven by staff costs which represents the investment in headcount (excluding Directors) averaging 73 in 2021 (FY20: 49). This investment was crucial and allowed the business to continue to build out its commercial team and drive execution across sales and publisher business development while reinforcing the product team.

Operating expenses (excluding exceptional items) (£)

Net loss (£)

At the year end, the cash balance held was £7.1m (FY20: £2.3m), in line with market expectations. The movement reflects the successful fundraise in July 2021 of £10.86m (before expenses), significant improvement in gross margin and enhanced the investment in innovation qualifying for R&D tax credits. Net cash used in operations before tax adjustments has remained relatively flat at £6.2m over the last two years, reflecting the Group’s careful management of its working capital.

Cash flow bridge 2019 – 2021 (£M)

FY19 £3.1m/ FY20 £2.4m/ FY21 £7.1