Comscore, Inc. (Nasdaq: SCOR), a trusted partner for planning, transacting and evaluating media across platforms, today reported financial results for the fourth quarter and full year ended December 31, 2020.

Fourth Quarter 2020 Financial Highlights

• Revenue for the fourth quarter was $90.0 million compared to $95.2 million in the prior-year quarter
• Net loss of $13.2 million, or $(0.18) per share, compared to a net loss of $21.4 million, or $(0.31) per share in the year-ago quarter
• Adjusted EBITDA of $9.4 million compared to $5.5 million in the prior-year quarter; current period includes a $2.0 million one-time non-cash reduction to cost of revenues related to a revenue-share arrangement

Full-Year 2020 Financial Highlights

• Revenue for 2020 was $356.0 million compared to $388.6 million in 2019
• Net loss of $47.9 million, or $(0.67) per share, compared to $339.0 million, or $(5.33) per share in 2019; loss includes impairment charges of $4.7 million and $241.6 million for 2020 and 2019, respectively
• Adjusted EBITDA of $32.3 million compared to $6.2 million in 2019
• Cash, cash equivalents and restricted cash of $50.7 million as of December 31, 2020 compared to $66.8 million as of December 31, 2019

Recent Key Renewals, Partnerships and New Business Developments

• Syndicated Digital – Renewals include Hearst, Readers Digest Canada, Trusted Media Brands and Magnite while adding Texas Monthly, Team Liquid, Pocket Outdoor, and Anzu as new clients
• Agency – Expanded partnership with dentsu Media to incorporate local television audience and impression-based solutions in local market buying; secured exclusive local television currency agreement with The Moran Group for 20 markets and an exclusive currency deal with Strong Automotive Merchandising Partners across 20 markets
• National TV – Secured renewals with two of the top five media companies
• Local TV – Expanded partnership with Gray, 87 of 94 Gray markets now using Comscore as exclusive selling and posting currency, including Gray's largest market, Cleveland; Tegna renewal includes 22 total markets, adding 6 new markets, and 16 of 22 total markets are using Comscore as exclusive selling and posting currency. Other renewals include Graham Media Group and Griffin Communications
• Activation – Expanded data agreement with Omnicom; launched patent-pending contextual targeting solution for livestreaming connected TV content, the industry's first solution to contextually categorize livestreaming
• International CTV – Expanded measurement solutions in Australia

"Comscore showed a strong focus on operating performance during a challenging time," said Bill Livek, CEO and Executive Vice Chairman of Comscore. "We saw continued improvement in many areas of our business, and with the stockholder vote now completed, we are laser focused on executing our plan and excited about our ability to grow revenue from our audience, content and impression based currencies."

Fourth Quarter Summary Results

Total revenue in the fourth quarter of 2020 was $90.0 million, down from $95.2 million in the year-ago quarter, primarily from lower syndicated digital and movie revenue offset by increases in custom marketing solutions and Activation.

Ratings and Planning revenue was $63.6 million in the fourth quarter of 2020, compared to $66.8 million in the year-ago quarter. The decrease compared to the same period in the prior year was the result of a decline in revenue from syndicated digital products, partially offset by higher National and Local TV revenue. While lower compared to the fourth quarter of 2019, syndicated digital was flat on a sequential basis. TV continued to experience higher revenue compared to the prior year as we continued to expand partnerships in 2020.

Analytics and Optimization revenue was $19.3 million in the fourth quarter of 2020, compared to $17.7 million in the year-ago quarter. The increase was related to higher revenue across products, including digital custom marketing solution sales and Lift. Activation also increased compared to the prior year as well as compared to prior quarters, which were impacted by the pandemic.

Movies Reporting and Analytics revenue was $7.1 million in the fourth quarter of 2020, compared to $10.7 million in the year-ago quarter. Revenue continues to be impacted by ongoing theater closures. We expect theater closures to continue affecting Movies revenue until the major theater chains reopen across the U.S. and abroad.

Expenses from cost of revenues, sales and marketing, research and development and general and administrative were $85.0 million compared to $95.9 million in the year-ago quarter. The decrease relates to a reduction in compensation expense due to lower headcount, as well as lower facility costs, professional fees and other general operating expenses. In the fourth quarter of 2020, the company recorded a $2.0 million one-time non-cash reduction to cost of revenues related to a revenue-share arrangement.

Net loss for the fourth quarter of 2020 was $13.2 million, or $(0.18) per share, compared to a net loss of $21.4 million, or $(0.31) per share reported in the year-ago quarter.

For the fourth quarter of 2020, non-GAAP adjusted EBITDA was $9.4 million, compared to $5.5 million in the year-ago quarter. Fourth quarter adjusted EBITDA includes a $2.0 million one-time non-cash reduction to cost of revenues related to a revenue-share arrangement. Adjusted EBITDA excludes stock-based compensation expense; impairment charges; change in fair value of financing derivatives and warrants liability; restructuring expense; and other items as presented in the accompanying tables.

Full-Year Summary Results

Total revenue for the full year of 2020 was $356.0 million compared to $388.6 million in 2019.

Ratings and Planning revenue was $253.7 million compared to $271.6 million in the prior year, primarily driven by a decrease in revenue from syndicated and digital products, partially offset by higher National and Local TV revenue.

Analytics and Optimization revenue was $69.1 million compared to $74.7 million in the prior year, primarily driven by lower sales and deliveries of digital custom solutions, survey and Lift products in 2020. The decrease was offset by an increase in revenue from Activation products, which continued to experience year-over-year growth.

Movies Reporting and Analytics revenue was $33.3 million compared to $42.3 million in the prior year. Revenue continues to be impacted by ongoing theater closures. We expect theater closures to continue affecting Movies revenue until the major theater chains reopen across the U.S. and abroad.

Expenses from cost of revenues, sales and marketing, research and development and general and administrative were $345.4 million compared to $417.0 million in the prior year. The decrease relates to a reduction in compensation expense due to lower headcount, as well as lower facility costs, professional fees, other general operating expenses and the revenue-share cost reduction described above. A portion of this reduction relates to temporary actions the company implemented to reduce costs given the current economic uncertainty.

Net loss for the full year 2020 was $47.9 million, or $(0.67) per share, compared to a net loss of $339.0 million or $(5.33) per share in 2019. In 2020, the company took a non-cash impairment charge totaling $4.7 million relating to operating right-of-use assets. In 2019, the company took non-cash impairment charges totaling $241.6 million relating to an intangible asset and goodwill.

For the full year of 2020, non-GAAP adjusted EBITDA was $32.3 million, compared to $6.2 million in 2019.

Balance Sheet and Liquidity

As of December 31, 2020, cash, cash equivalents and restricted cash totaled $50.7 million, including $19.6 million in restricted cash. Total debt principal as of December 31, 2020, including $204.0 million of senior secured convertible notes, was $221.9 million. As previously disclosed, the company expects to use proceeds from the investment transactions to extinguish the senior secured convertible notes and will also extinguish its foreign secured term note with cash from its balance sheet.

2021 Outlook

Based on current trends and expectations, the company believes full-year 2021 revenue will increase between 3% and 5% over 2020, driven by a stabilization in syndicated digital revenue, growth in TV revenue, increased Activation revenue and improvement during the year in Movies. The company expects an adjusted EBITDA margin of 6% to 8% for the full year 2021.

Upon closing of the investment transactions, the Company expects to record a non-cash charge that will include extinguishment of debt and associated derivatives, issuance of 3.15 million conversion shares to affiliates of Starboard Value LP, and an antidilution adjustment to the Series A warrant exercise price, which is expected to reset to the transaction price of $2.47 upon closing. The non-cash charge at closing is estimated to range between $15 million and $25 million on a GAAP basis based on recent trading prices, but could vary depending on the market price of the Company's common stock on the closing date and other variables. The charge is not expected to have an impact to adjusted EBITDA.

The company does not provide GAAP net income (loss) on a forward-looking basis because it is unable to predict with reasonable certainty its future stock-based compensation expense, litigation and restructuring expense, fair value adjustments for financing derivatives and warrants, variable interest expense, and any unusual gains or losses without unreasonable effort. These items are uncertain, depend on various factors, and could be material to results computed in accordance with GAAP. For this reason, the company is unable without unreasonable effort to provide a reconciliation of adjusted EBITDA or adjusted EBITDA margin to the most directly comparable GAAP measure, GAAP net income (loss), on a forward-looking basis.

About Comscore

Comscore is a trusted partner for planning, transacting and evaluating media across platforms. With a data footprint that combines digital, linear TV, over-the-top and theatrical viewership intelligence with advanced audience insights, Comscore allows media buyers and sellers to quantify their multiscreen behavior and make business decisions with confidence. A proven leader in measuring digital and TV audiences and advertising at scale, Comscore is the industry's emerging, third-party source for reliable and comprehensive cross-platform measurement.