Taptica climbs after 'strong' showing from brand advertising

Taptica International's shares climbed on Tuesday after profit and revenue were boosted by a strong performance from the business' brand advertising arm.

The Israeli video advertising firm recorded 2018 profit before tax of $27.2m, an increase of 57% compared to the year before, as revenue jumped by 31% to $276.9m due to the "strong performance" of the brand advertising arm, which generated revenues of $146.1m or 53% of total revenue.

The division added clients such as American department store TJMaxx, car rental giant Hertz, best-selling US Greek yogurt brand Chobani, with the leisure, retail and auto segment verticals performing strongly alongside.

Tim Weller, non-executive chairman of Taptica, said: "2018 was another year of continued progress for Taptica, during which we successfully executed on our strategy to deliver higher-margin revenues and broaden our blue-chip client base internationally. What is particularly pleasing is the performance of the company's brand advertising platform, Tremor Video DSP, which has reported a significant improvement in earnings for the year."

Meanwhile, the Performance-Based Marketing division saw revenue decrease by 11% to $130.8m as a result of an anticipated reduction in legacy revenues in display and video, according to the AIM traded company.

Taptica is in the process of merging with video advertising group RhythmOne, which would mitigate much of the market volatility seen last year, according to a statement from the company.

The outfit's share price has suffered since Hagai Tal stepped down from the chief executive in December due to a legal action related to a company he had previously been involved in.

"The outlook for the company remains positive with Taptica continuing to benefit from the global shift in advertising spend away from traditional advertising methods and towards specialist data-driven technology providers and digital video. Taptica expects the growth of subscription-based video and over-the-top media services (OTT) to continue," said Weller.

Taptica's shares were up 4.02% at 179.95p at 1335 GMT.