REG - Digitalbox PLC - Trading Update

DigitalboxAnnouncement

19/09/2023 16:15

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RNS Number : 9657M  Digitalbox PLC  19 September 2023

19 September 2023

 

Digitalbox plc

("Digitalbox", the "Group" or the "Company")

 

Trading Update

 

Digitalbox plc, the mobile-first digital media business, which owns leading
websites Entertainment Daily, The Daily Mash, The Tab and The Poke today
announces a trading update ahead of the publication of its unaudited results
for the six months to June 2023 ("H1 2023") which are due to be announced on
26 September 2023.

For H1 2023, the Group will report revenue of £1.2m (unaudited) and net cash
of £2.3 million (as at 30 June 2023).

 

While the Company has traded ahead of the Board's expectations in H1 2023, it
has seen traffic sourcing to its sites in the first months of H2 2023 continue
to be impacted by a previously communicated and well-documented trend that
many publishers are seeing.

 

This trend is for lower traffic volumes from the major platform sources
Alphabet and Meta to third party sites. Macro-economic pressure on these key
players means they have had to increase consumer engagement time on their own
platforms to improve their results, which has reduced traffic sent to
third-party publishers like Digitalbox.

 

Furthermore, Digitalbox has seen a block within Google Discover cutting
traffic to the Group's leading brand Entertainment Daily, and an imposed reach
reduction on a leading Facebook page for The Tab. While traffic volumes have
been disappointing, session values have traded materially ahead of the market.

 

There remains uncertainty as to the degree to which traffic from the major
platform sources may recover in H2 2023, but the Board expects full-year
revenue for 2023 to be approximately £2.8m and the Company to remain
profitable at adjusted EBITDA* level.

 

To combat this emerging trend, the Company has been planning an on-platform
pivot fuelled by AI-assisted video output creation to increase audience
engagement for its brands. This new approach has been combined with the
acquisition of the Social Chain assets in August. This acquisition has
increased the Group's followers on social media from 8m to over 20m. This
expansion provides a significant opportunity for the Group to gain revenue in
2024 when the digital ad market is expected to recover as the Company becomes
less reliant on taking audiences off the major platforms.

 

Adjusted EBITDA, defined as the profit from operations after deducting
depreciation, amortisation, share-based payments, acquisition and listing
costs, direct costs associated with business combinations and capital
restructure costs.

 

Market abuse regulation: This announcement contains inside information for the
purposes of Article 7 of Regulation (EU) No 596/2014 as it forms part of UK
domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR").
The person responsible for arranging for the release of this announcement on
behalf of the Company is James Carter, Chief Executive Officer.

 

 

Enquiries:

 

 Digitalbox                                                  c/o SEC Newgate
 James Carter, CEO

 Panmure Gordon                                              Tel: 020 7886 2500

 (Nominated Adviser, Financial Adviser & Joint Broker)
 James Sinclair-Ford / Ivo Macdonald (Corporate Advisory)
 Rupert Dearden (Corporate Broking)

 Leander Capital Partners (Joint Broker)                     Tel: 020 7195 1400
 Alex Davies

 SEC Newgate (Financial Communications)                      Tel: 07970 664807
 Robin Tozer / Molly Gretton                                 digitalbox@secnewgate.co.uk

 

 

About Digitalbox plc

 

Based in the UK, Digitalbox is a 'pure-play' digital media business with the
aim of profitable publishing at scale on mobile platforms.

Digitalbox operates the trading brands of "Entertainment Daily", "The Daily
Mash", "The Tab", and "The Poke".

Entertainment Daily produces and publishes online UK entertainment news
covering TV, showbiz and celebrity news. The Daily Mash produces and publishes
satirical news content. The Tab is the UK's biggest youth culture site
fuelled by students.  The Poke expertly curates and editorialises the
funniest content from around the web and social media.

Digitalbox primarily generates revenue from the sale of advertising in and
around the content it publishes. The Company's optimisation for mobile enables
it to achieve revenues per session significantly ahead of market norms for
publishers on mobile.

 

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