The information contained within this announcement is deemed by the Company to constitute inside information stipulated under the Market Abuse Regulation (EU) No. 596/2014 as it forms part of the domestic law of the United Kingdom by virtue of the European Union (Withdrawal) Act 2018 (as amended) ("UK MAR"). Upon the publication of this announcement via the Regulatory Information Service, this inside information is now considered to be in the public domain.

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION (DIRECTLY OR INDIRECTLY) IN WHOLE OR IN PART IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION.

FOR IMMEDIATE RELEASE           

4 March 2025

 Team Internet Group plc

("Team Internet" or the "Group")

Response to Rule 2.8 announcement from Verdane,

Search market development and

Notice of results

The Board (the "Board") of Team Internet Group plc (AIM: TIG, OTCQX: TIGXF) notes the announcement from Verdane Fund Manager AB ("Verdane") confirming that it does not intend to make a firm offer for Team Internet. As a result, Verdane is bound by the restrictions set out in Rule 2.8 of the City Code on Takeovers and Mergers (the "Takeover Code").

The Board remains confident in Team Internet's fundamental prospects and business. Team Internet is a highly profitable and cash-generative business and, as announced on 11 November 2024, continues to explore options to increase shareholder value including optimising its capital allocation strategy, as well as a comprehensive review of its asset ownership.  The interaction of the Board with the two recent inbound approaches (as noted in the announcement on 7 January 2025) was consistent with the Board's efforts to maximise shareholder value. We have also received repeated approaches for our Domains, Identity & Software ("DIS") segment, which continues to trade strongly. 

Search market development

Google recently announced that from 19 March 2025, it will begin the process of opting all Google Ads accounts out of AdSense for Domains ("AFD"), while allowing advertisers to opt back in. The timeline for completing this process, the rate of advertisers opting back in, and the potential impact on average click prices-and consequently, our Revenue Per Thousand impressions ("RPM") KPI-cannot be accurately estimated at this time. This is expected to lead to an accelerated move from AFD to Google's latest monetisation product, Related Search On Content ("RSOC").

The Board believes that Team Internet is well-positioned to navigate this transition and that this will be a positive development in due course, producing a much more sustainable market and create a more valuable business.

Strategic response

As a leading provider of domain monetisation and digital advertising solutions, Team Internet has been preparing for the arrival of Google's latest monetisation product, RSOC and Team Internet's transition to RSOC. RSOC is core to the transformation of our Search segment into a content and video publishing powerhouse and offers an enhanced user and advertiser experience, as indicated in our November 2024 investor presentation[1].  The market development has been long-anticipated, though the announced acceleration is a challenge. It is anticipated that, during this transition period, contributions from AFD will decline faster than contributions from RSOC appreciate, meaning that the financial performance of Team Internet's Search segment will see a trough in 2025 before it recovers from 2026 onwards and returns to the long-term pattern.

In addition, we are a market leader in zero-click solutions via our Zeropark platform, which offers an alternative to AFD. We continue to work closely with our partners to navigate this transition effectively. We are seeing unprecedented demand for our solutions and are strategically prioritising new customer onboarding to ensure service quality and performance[2].

Balanced earnings composition

Even following the challenges associated with the Search division transition, we have a business which is highly profitable and cash generative. This means we are well placed to continue our review of asset ownership, use our cashflows to reduce debt, continue to return cash to shareholders via a mix of dividends and buybacks, or a blend of some or all of these actions.

In 2024, our Search segment generated $91 million in net revenue, of which approximately $72 million was derived from our Google AFD relationship, the remainder being generated by RSOC, zero-click, display and video advertising.

Our DIS segment, which operates on a subscription-based model, provides a stable and resilient revenue stream, serving as a strong foundation for long-term profitability.

Additionally, our Comparison segment continues to experience strong organic growth with significant operating leverage, providing significant runway for future profit growth.

The DIS and Comparison segments together contributed 52% of the Group's net revenue in 2024, up from 44% in 2023, and are expected to grow further in 2025 and beyond.

Outlook

At this stage our best estimate of 2025 Search segment Adjusted EBITDA is between $20 million and $25 million (2024: $57 million). We expect 2025 Adjusted EBITDA of between $40 million and $43 million (2024: $36 million) from our DIS and Comparison segments, which is consistent with our previous estimates. That adds up to a range of between $60 million and $68 million for Group Adjusted EBITDA in 2025 before a return to double-digit earnings growth from 2026 onwards. 

Notice of results

The Group will provide a further update when it publishes its audited Annual report for the financial year ended 31 December 2024 on Monday, 24 March 2025.

On the day of results there will be a webinar for equity analysts at 10:00, UK time. The presentation will be hosted by CEO Michael Riedl and CFO Billy Green. To register please contact SEC Newgate at [email protected] where further details will be provided.

Furthermore, Team Internet will hold an Investor Meet Company session at 12:00, UK time, on 24 March 2025. Investors can sign up to Investor Meet Company for free to meet Team Internet Group Plc via: https://investormeetcompany.com/team-internet-group-plc/register-investor

Investors who already follow Team Internet Group Plc on the Investor Meet Company platform will automatically be invited. Questions can be submitted pre-event via your Investor Meet Company dashboard up until 09:00 the day before the meeting or at any time during the live presentation.

CEO Comment

Michael Riedl, CEO of Team Internet, commented:
"Changes in the digital advertising landscape are inevitable and Team Internet has a proven track record of adapting to industry shifts and emerging stronger. The early reception of our RSOC solution has been extremely positive, and we remain confident that our diversified model, financial strength, and proactive strategy will continue to deliver long-term shareholder value."

Enquiries

For further information, please contact:

Team Internet Group plc                                                                                            +44 (0) 203 388 0600

Michael Riedl, Chief Executive Officer

William Green, Chief Financial Officer

Zeus Capital Limited (NOMAD and Joint Broker)

Nick Cowles / James Edis (Investment Banking)                                                      +44 (0) 161 831 1512

Dominic King (Corporate Broking)                                                                             +44 (0) 203 829 5000       

Berenberg (Joint Broker) 

Mark Whitmore / Richard Andrews / Alix Mecklenburg-Solodkoff                      +44(0) 203 207 7800

Important notices

In accordance with Rule 26.1 of the Takeover Code, a copy of the announcement will be available on Team Internet's website at www.teaminternet.com by no later than 12 noon (London time) on the business day following the date of this announcement. The content of the website referred to in this announcement is not incorporated into, and does not form part of, this announcement.

This announcement has been prepared in accordance with English law and information disclosed may not be the same as that which would have been prepared in accordance with the laws of jurisdictions outside England.

The distribution of this announcement in jurisdictions other than the United Kingdom may be affected by the laws of relevant jurisdictions. Therefore, any persons who are subject to the laws of any jurisdiction other than the United Kingdom or shareholders of Team Internet who are not resident in the United Kingdom will need to inform themselves about, and observe, any applicable requirements.

Certain statements in this announcement are forward looking and so involve risk and uncertainty because they relate to events, and depend upon circumstances that will occur in the future and therefore results and developments can differ materially from those anticipated. The forward-looking statements reflect knowledge and information available at the date of preparation of this announcement and Team Internet undertakes no obligation to update these forward-looking statements.