Fraud-prevention software developer Adveritas (ASX: AV1) has completed an $8.5 million placement to existing shareholders and new institutional investors in support of its global growth strategy.
The company will issue approximately 85 million shares priced at $0.10 each, representing a 4.8% discount to the last closing price and a 67% premium to the price of capital raised in May.
The oversubscribed raising will strengthen Adveritas’ cash balance and support its expansion into the US market and new verticals including e-commerce, as well as support ongoing product development and integrations with affiliate platforms to increase cross-selling opportunities with existing clients.
Market response
Adveritas co-founder and chief executive officer Mathew Ratty said he was pleased with the market response to the raising.
“I would like to thank our long-term shareholders for their continued strong support and welcome our new investors to the share register,” he said.
“Our strengthened cash balance will support us in achieving our strategic objectives, which in turn will lead us to consistently generate positive operating cash flows.”
Record contract value
Adveritas has described achieving record single-customer annual contract value of $1m as a “significant milestone in the company’s global evolution”.
The value is more than 10 times higher than the record annual contract value the company achieved two years earlier.
Adveritas has also signed a number of renewal contracts with global sports betting clients containing higher contract rates and longer terms.
These renewals increased the company’s annual contract values by around 27% in the March quarter and are expected to generate cash receipts of $5m over the collective term.
Strong client base
Ongoing improvements to its flagship TrafficGuard product and the release of in-demand features including shadow campaigns and Smart Ranges is driving the strength of Adveritas’ client base.
Adveritas designed Smart Ranges specifically for gaming and betting clients to address issues related to sophisticated and large-scale activities associated with invalid traffic and fraud.
Initial rollouts have shown promising results, with clients experiencing return-on-investment increases of up to 25% in digital advertising spend.
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