Adcore Inc.

Good morning. Welcome to AdCourse Q4 and year-end earnings call. Well, you will give guests another minute to join. So please just sit tight while we wait for our guests to join the call. Thank you all to have joined AdCourse Q4 and year-end earnings call. We're going to give investors another moment to join and we will begin shortly. Okay, thank you all for your patience and with that we'll begin the call and welcome to AdCourse Q4 and year-end earnings call for 2024. You might have seen the press release we put out this morning highlighting a very strong increase in revenue of 24% for Q4 and a record high $3.9 million in gross profit. Today we will review those results in more detail. On the call today, you have myself, Nick Campbell. I'm head of IR. You will have Omri Brill, AdCourse CEO and founder, and Amit Comforti, AdCourse CFO. For the call today, we'll begin with some forward-looking statements you should be aware of when listening to this call, followed by the CEO opening remarks, and then the CFO financial highlights, and concluding with a Q&A. If you do have a question during this call, I'll ask you to use the Submitted Chat feature in Zoom, and we will get to those at the end. Just before we begin, I will make everyone aware that today in this call we'll be making forward-looking statements. These statements are uncertain in nature, so please bear that in mind. I will give everyone about 15 to 30 seconds to review this information, and then we'll move on. Okay, and with that, I will pass the floor to Omri Brill for the CEO opening remarks. Omri, the floor is yours.

Excellent. Let me share my screen. Just one second. Okay, so good morning, everyone, and thank you so much for joining our Q4 earning call. Every earning call, I think it's an exciting moment for the company and opportunity, obviously, to speak with our shareholders. But end of year earning call is always more unique, and I think this quarter even more unique because of the results that we are about to display today. So we are very pleased from the company results in Q4 2024 and for the entire year as well. And let's jump to my presentation. So we had a record break in Q4 and here in 2024 financial results, very strong movement across the board, top line, middle line and bottom line as well. And if you look at top line revenue, we ended up Q4 in 11.2 million in top line revenue. That's a massive increase of almost 25% year on year from 9 million in revenues that we did in the previous year as well. By the way, that's the second strongest quarter in terms of top line revenue the company ever reported. And in terms of gross profit, actually, that's the biggest result that we've been able to show. $3.9 million in gross profit, and that represents 6% year-on-year growth as well. So quite impressive top line and middle line number. Another important KPI, then again, gross profit almost $4 million in Q4 2024, record in terms of what the company has been able to achieve up until now. Cash position spiked to almost $11 million in Q4 2024 compared to $8 million in the previous year. And that represents 34% year-on-year increase. So that's, again, a massive increase. Obviously, if you look quarter over quarter, it's even more impressive. We have like 6.7 million in cash and cash position in Q3 2024 and almost 11 million in Q4 2024. Oh, absolutely, there is seasonality attached to it. But let's say even when we take it into effect, the seasonality is still year-on-year, 34% increase. That's massive. So just to highlight some of the key results that we've been able to present in this quarter, revenue grew by 24% to a bit over $11 million. APAC revenue grew by almost 60%. That's an astonishing number, especially taking into consideration that APAC was challenging post-COVID in 2022 and also in the beginning of 2023. So we see a massive rebound from this important region. EMEA revenue actually that was challenging in the first part of the year grew by 14% this quarter. Net cash flow generated by operating activities spiked to $4 million almost this quarter compared to $1 million in the previous quarter. That represents an extreme growth in net cash flow. Gross profit, almost $4 million. And again, 6% grew year on year compared to the previous quarter. Operation profit grew by almost 300% to $0.4 million. this quarter compared to 0.1 million in the previous year. And adjusted EBITDA spike to 1.3 million compared to 0.5 million in Q4, 2023. So very impressive number across the board, top line, middle line, bottom line, everything moving in the right direction this quarter for us. And also if you look at the entire year, then in a sense Q4, make 2024 in the end of the day quite a positive year for us. If you bear in mind, we started 2024 a bit with some challenges and it was a slow start of the year. And then we saw like a big momentum build up in Q3 and Q4. Basically it was the best finish for this year that we can imagine. So all in all, Including Q4, revenue grew in 2024 by 4%. APAC revenue grew by 25%. That's impressive. North America revenue grew for the entire year by 14%. Net cash flow generated by operating activity grew to $3.3 million compared to $1.1 million in the previous year. Gross profit grew to $13.5 million. That's almost a $1 million increase or 6% increase year on year. Adjusted EBITDA grew to $1.6 million compared to $0.9 million in 2023. And cash and cash position grew by 20, by 34%, again, almost to 11 million. So even, let's say, quarterly, an amazing result. And also the year, all the metrics are positive, top line, bottom line, middle line, everything moving in the right direction for us this year as well. And that's actually a very interesting graph. We can see the company adjusted EBITDA build up throughout the different quarters, starting almost since the time the company went public in, let's say, it was mid-2019. But let's say this graph shows numbers since 2020. And we can see there was, let's say, a good moment to build up in adjusted EBITDA for the company around COVID 2020 and 2021. And all in all, the company being able to demonstrate, to achieve positive adjusted EBITDA in 20 quarters out of 22 quarters that we reported in this graph. And actually Q4 2024, with 1.3 almost million in adjusted EBITDA. It's the second strongest month quarter for us, sorry, in terms of adjusted EBITDA. So let's demonstrate how strong Q4 is for the company. And we can also see that the beginning of, let's say, 2023, the company is starting to rebuild momentum in adjusted EBITDA as well. So what slowly picked up in 2023 now become a bit more impressive, obviously, in the end of 2024 as well. So very interesting graph. And again, out of 2020 quarters that the company covered in this graph, only two quarters were negative and all the rest was with positive adjusted EBITDA. And I think end of year result, it's also a good opportunity not just to summarize 2024. And I think for 2024, the numbers speak for themselves, right? At the end of the day, everything is baked within the financial result of the company. But I would like to take the opportunity and also discuss the company growth strategy for 2025. and how can we continue accelerating our momentum, especially the momentum that we saw in the second part of 2024, in Q3 and Q4. So the company is aiming to achieve $40 million in revenue in 2025. In order to do that, we will need to grow our revenue base by 25% this year. So it's a big goal, but we are confident enough in order to put this goal over here and obviously work out in order to achieve that. In terms of striking our profitability, this is another goal that the company would like to take. We would like to see straight a quarter with positive adjusted EBITDA, so Q3, Q4 2024, and obviously all the quarters within 2025 as well. And obviously, continue to see positive cash flow from operating activity in 2025 as well. We would like to see AI-driven innovation for the company, so deep AI integration across our R&D department, across our marketing solution department, and most importantly, maybe across our different applications. So AI is already a game changer for us in the way we are able to do business. And in 2025, we would like to double down on it and basically deepen our AI integration across the board, basically. And we would like also to continue to see growth in our ARR across the different applications. And our goal is to achieve between 4 million to 5 million in AR across the different application in 2025. So we would like to see the continued momentum that we saw in 2024 in technology, sorry, in technology revenue continue to grow in 2025 as well. So a lot of AI, we're taking like big, big goals, you know, in terms of profitability and depth of revenue. And again, technology, I think if all of that's going to take place or even some of that's going to take place, 2025 should be even a better year than 2024 was for us. That's also a good opportunity to cover the current share price, which is 0.3. We did see like a very positive move in the share price in the last, I would say, two months or so, you know, from the low of around 0.3. or 14 cents or 15 cents. Now it's almost double up or more than double up to 30 cents. But we still believe, management still believe the share, the coin share price is deeply discounted and basically don't really reflect the true company valuation. We can also see if we look at the comparable company that is like a very big upside, still to go with the stock price. If you look at EV to gross profit, we're talking about 300, more than 300%. and even if you talk EV to EBITDA, then we still talk about around 70% upside from the current share price. So we continue to believe in the company's story. Edcore is actually regaining momentum in the second part of 2024. We had the strongest possible imagine end of 2024 in Q4, and we couldn't be more happy with the results we presented. And I think now for Amit to go over the result in more details.

Thank you, Omri, and indeed very strong numbers across the board. We'll now move on to Amit for the CFO Financial Highlights. Amit, the floor is yours.