Benzinga | May 10, 2021 06:28AM EDT

Digital Media Solutions Reports Preliminary Q1 Earnings, Issues Q2 Guidance

* Digital Media Solutions Inc (NYSE: DMS) reported preliminary first-quarter FY21 revenue growth of 33.1% year-on-year to $96.8 million, beating the analyst consensus of $96.46 million. The adjusted revenue grew 33.5% Y/Y to $99.5 million.

* Brand-Direct Solutions revenue rose 37.4% Y/Y to $56.2 million, Marketplace Solutions revenue rose 44.1% Y/Y to $49.3 million, primarily due to insurance sector revenue growth. Other Solutions revenue rose 60.2% Y/Y to $2 million.

* For the largest vertical, insurance, the company generated organic Y/Y revenue growth of 102% and quote request growth of 111%, and anticipates continued strength within insurance throughout the year, CEO Joe Marinucci said.

* Marinucci expects strong growth from the insurance business and margin expansion from the Crisp Results acquisition.

* Gross margin expanded 140 basis points to 28.5%. Brand-Direct Solutions clocked a 240 basis points margin expansion at 26.9%, while Marketplace Solutions margin contracted 730 basis points to 25.7%.

* Adjusted EPS of $0.09 was at par with the analyst consensus. Adjusted EBITDA rose 5.4% Y/Y to $14.1 million.

* The company held $23.9 million in cash and equivalents.

* Guidance: Digital Media Solutions sees a Q2 adjusted revenue outlook of $102 million -107 million and an adjusted EBITDA outlook of $15.2 million -15.7 million.

* It reiterated FY21 adjusted revenue guidance of $455 million - 465 million and adjusted EBITDA guidance of $72 million -75 million.

* Price action: DMS shares closed higher by 3.54% at $11.42 on Friday.