boku 2

Strong H1 performance

Boku 16 September 2020 Update
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Boku

Strong H1 performance

H120 results

Software & comp services

21 September 2020

Price

94.3p

Market cap

£267m

US$1.29/£1

Net cash ($m) at end H120

60.4

Shares in issue

282.7m

Free float

89%

Code

BOKU

Primary exchange

AIM

Secondary exchange

N/A

Share price performance

%

1m

3m

12m

Abs

8.6

3.9

(18.2)

Rel (local)

8.3

2.5

(2.7)

52-week high/low

115.5p

49.0p

Business description

Boku operates a billing and identity verification platform that connects merchants with mobile network operators in more than 50 countries. It has c 300 employees, with its main offices in the US, UK, Estonia, Germany and India.

Next event

FY20 trading update

January 2021

Analyst

Katherine Thompson

+44 (0)20 3077 5730

Boku is a research client of Edison Investment Research Limited

Restrictions relating to COVID-19 have had a mixed effect on Boku’s H120 performance, with the Payments business benefiting from increased demand for digital content, while some Identity customers saw weaker demand for their services. Despite this, Boku reported adjusted revenue growth of 9% y-o-y and, demonstrating the operational leverage of the business, adjusted EBITDA growth of 84% y-o-y. With guidance unchanged for FY20, we maintain our EBITDA forecasts.

Year
end

Revenue ($m)

EBITDA*
($m)

Diluted EPS*
($)

DPS
($)

P/E
(x)

EV/EBITDA
(x)

12/18

35.3

6.3

0.016

0.0

78.4

51.9

12/19

50.1

7.4**

0.012

0.0

101.2

44.3

12/20e

55.1

12.3

0.022

0.0

56.2

26.7

12/21e

66.4

17.7

0.032

0.0

38.3

18.5

12/22e

77.7

21.1

0.040

0.0

30.1

15.5

Note: *EBITDA and EPS are normalised, excluding amortisation of acquired intangibles, exceptional items and share-based payments. **Excludes one-off revenue recognition.

Adjusted EBITDA growth of 84% in H120

Boku reported H120 group revenue and EBITDA in line with its July trading update (growth of 5% and 50% y-o-y, respectively, or 9% and 84% on an adjusted basis). As previously highlighted, COVID-19 lockdown restrictions benefited the Payments business through a combination of higher user numbers and lower operating costs, driving adjusted revenue growth of 14% y-o-y and adjusted EBITDA growth of 45%. The Identity business saw existing customers hit by the restrictions and a tougher environment for signing new business, with revenue down 21% y-o-y; although tight cost control reduced the EBITDA loss to $2.0m from $2.3m a year ago.

Maintaining guidance for FY20

In H2, the Payments business will benefit from the first-time consolidation of Fortumo (acquired 1 July), which bolsters the company’s dominance of the direct-carrier billing market, and should see a growing contribution from eWallet services as more merchants go live. In the Identity business, the company is focused on signing up new customers and expanding its carrier network. Management is confident that it can at least meet consensus expectations for FY20. We have made minor changes to our forecasts to reflect H120 performance, although our EBITDA forecasts for FY20–22e are unchanged.

Valuation: Sum-of-parts suggests upside

On EV/sales and EV/EBITDA, Boku is trading at a discount to the average of payment processor peers and identity management peers. Reflecting the different growth and profitability dynamics of the Payments and Identity businesses, we use a sum-of-the-parts approach to assign value to each separately, generating a group equity value of 124p per share. Excluding the Identity business entirely, Boku would be worth 117p per share, still well ahead of the current share price. Key catalysts for the share price include a return to revenue growth in the Boku Identity business, new major merchants being signed up and a growing contribution from wallets.

Review of H120 results

Exhibit 1: Half-yearly results highlights

H119

H120

y-o-y

TPV

$bn

2.3

3.1

36.2%

Take rate

%

0.9%

0.7%

-0.18%

Payment revenues

$m

20.2

22.0

9.2%

Adjusted Payment revenues

$m

19.4

22.0

13.7%

Identity revenues

$m

3.4

2.7

-21.0%

Group revenues

$m

23.5

24.7

4.9%

Adjusted revenues

$m

22.7

24.7

8.6%

Gross profit

$m

20.6

22.4

9.0%

Adjusted gross profit

$m

19.8

22.4

13.4%

Opex

$m

(16.3)

(16.0)

-1.8%

Payments EBITDA

$m

6.6

8.5

27.7%

Adjusted Payments EBITDA

$m

5.8

8.5

45.0%

Identity EBITDA

$m

(2.3)

(2.0)

-13.2%

Group EBITDA

$m

4.3

6.4

50.1%

Adjusted EBITDA

$m

3.5

6.4

84.0%

D&A

$m

(1.3)

(1.7)

24.4%

Normalised operating profit

$m

3.0

4.8

61.8%

Amortisation of acquired intangibles

$m

(0.9)

(0.8)

Share-based payments

$m

(4.2)

(3.0)

Exceptional items

$m

(0.1)

(0.8)

Reported operating profit

$m

(2.3)

0.2

109.6%

Normalised net income

$m

2.2

3.7

70.5%

Reported net income

$m

(2.6)

0.0

101.4%

Gross margin

%

87.5%

90.9%

3.4%

Adjusted gross margin

%

87.1%

90.9%

3.8%

EBITDA margin

%

18.2%

26.1%

7.9%

Adjusted EBITDA margin

%

15.4%

26.1%

10.7%

Normalised operating margin

%

12.5%

19.3%

6.8%

Reported operating margin

%

-9.8%

0.9%

10.7%

Gross cash incl. restricted cash

$m

27.9

80.7

189.7%

Net cash (excl. restricted cash and lease liabilities)

$m

24.2

60.4

149.8%

Source: Boku, Edison Investment Research

H120 revenue and EBITDA were in line with the trading update published in July. The company noted that H119 benefited from a one-off revenue recognition of $0.79m relating to the implementation of IFRS 15. Excluding that, group revenue grew 8.6% y-o-y and group EBITDA grew 84% y-o-y. Share-based payments were lower y-o-y as fewer options and restricted stock units were issued. The group incurred an exceptional charge of $0.9m relating to the Fortumo acquisition.

Gross cash of $80.7m included $44.5m for the acquisition of Fortumo,1 which completed on 1 July. Net cash of $60.4m excludes restricted cash of $0.8m and takes into account debt of $19.5m ($20m loan to fund the Fortumo acquisition net of $0.5m loan costs). After accounting for the cost of the acquisition, the company had a net cash balance of $15.9m.

The average daily cash balance during June (which smooths out the effect of merchant and carrier payments, and excludes Fortumo-related cash flows) was $25.7m compared to $22.4m in December 2019.

Payments business generated strong EBITDA uplift

The Payments business grew revenue 9.2% y-o-y in H120, or 13.7% if the one-off revenue is excluded in H119. Gross margin for H120 of 98.2% was boosted by receipt of $211k of bad debts that had previously been provided for. Operating costs (excluding depreciation and amortisation) only increased 5% y-o-y, partly due to restrictions on travel relating to COVID-19. This resulted in Payments EBITDA growth of 27.7% y-o-y, or 45.0% excluding the one-off revenue in H119.

The business saw strong growth in total payment volume (TPV) of 36% y-o-y, helped by 19% growth in new users to 10.8m, as lockdown generated demand for digital content such as games and video streaming. Monthly active users grew 33% y-o-y in June to 20.3m. The take rate declined from 0.89% to 0.71% y-o-y. However, the company noted that rates were stable for both transaction and settlement model merchants, with the decline purely down to the higher growth of merchants using the lower take rate transaction model.

Despite lockdown restrictions, the company managed to launch new carrier connections for major merchants including Google, Netflix, Sony, Spotify and Tencent.

Identity business harder hit by COVID-19

Several of the Identity business’s customers rely on consumers being outside of the house – for example, ride-hailing companies – and were consequently hit hard by COVID-19 restrictions. It was also more difficult to sign up new customers during H1 as it was not possible to have face-to-face meetings in Q2. Divisional revenue declined 21% y-o-y but careful cost control and lower travel and marketing costs reduced the EBITDA loss from $2.3m to $2.0m.

To provide a comprehensive service to identity verification customers for its Authenticate, Match and Detect solutions, Boku’s Identity business needs connections to mobile network operators (MNOs) in the countries in which its customers’ end customers are located. Although Boku’s Payments business already has connections to a wide network of MNOs, the Identity business has to separately contract with these or other operators to get access to identity data. Since acquiring the Identity business, Boku has expanded its network to cover 200 MNOs in 57 countries and intends to continue to expand this network. It achieves this via direct connections (eg all UK MNOs) or third-party data providers. Having this wide geographic coverage paves the way for Boku to sign up multinational companies as well as local merchants for its mobile identity services. So far, merchants are live and generating revenues in five countries; new contract wins included LexisNexis and FIS.

eWallets: The next growth opportunity for Payments

Boku’s DCB network provides a payment mechanism for digital content and has successfully signed up the major merchants in each category. However, the company is keen to expand the types of payment methods it can support for mobile commerce to encompass physical goods and services in addition to digital content. eWallets are increasing in popularity, particularly in Asia, as a way to undertake mobile commerce and offer the benefit that transaction values are only limited by the funds available in the wallet, rather than by any limits set by regulators. eWallets tend not to be standardised, with different processes in each domestic market, which makes them more complicated for merchants to offer as a payment option. Boku has started building a network of eWallet providers so that merchants can offer them as alternative payment methods.

To date, Boku has signed up more than 10 eWallet providers and is live with seven eWallet providers in nine countries. Live programmes include mainstream console providers and music-streaming services in Indonesia and Korea. The company has announced agreements with the following eWallet providers: DANA (Indonesia), Grabpay (eight countries in South East Asia), Gopay (Indonesia), KaKaoPay (Korea), LinePay (Japan), Ovo (Indonesia) and PayPay (Japan).

Outlook and changes to forecasts

Management expects to achieve group revenue and EBITDA at least in line with current market expectations for FY20 (Refinitiv 10 September: revenue $55.5m, EBITDA $12.5m). For FY21, the company expects the Identity business to show revenue growth and a reduced EBITDA loss. For the Payments business, the consolidation of Fortumo in H2 and the growing contribution from eWallets gives management confidence for the future. We have made minor changes to our forecasts – EBITDA forecasts are unchanged but we have revised our depreciation and amortisation forecasts to reflect H1 performance.

Exhibit 2: Changes to forecasts

$m

FY20e

FY20e

FY21e

FY21e

FY22e

FY22e

Old

New

Change

y-o-y

Old

New

Change

y-o-y

Old

New

Change

y-o-y

Payment revenues

50.0

50.0

0.0%

15.0%

59.5

59.5

0.0%

19.1%

65.7

65.7

0.0%

10.3%

Adjusted Payment revenues

50.0

50.0

0.0%

24.3%

Identity revenues

5.2

5.2

-0.8%

-22.7%

6.9

6.9

0.0%

33.8%

12.0

12.0

0.0%

73.9%

Total revenues

55.2

55.1

-0.1%

10.0%

66.4

66.4

0.0%

20.4%

77.7

77.7

0.0%

16.9%

Total adjusted revenues

55.2

55.1

-0.1%

17.6%

Gross profit

49.6

49.7

0.4%

11.6%

59.3

59.1

-0.3%

18.9%

67.2

67.2

0.0%

13.6%

Gross margin

89.8%

90.2%

0.4%

1.3%

89.3%

89.1%

-0.2%

-1.2%

86.5%

86.5%

0.0%

-2.6%

Payment EBITDA

16.7

16.7

0.0%

4.9%

21.3

21.3

0.0%

27.6%

23.3

23.3

0.0%

9.3%

Adjusted Payment EBITDA

16.7

16.7

0.0%

31.8%

Identity EBITDA

(4.4)

(4.4)

0.0%

-16.4%

(3.6)

(3.6)

0.0%

-17.6%

(2.2)

(2.2)

0.0%

-39.6%

Total EBITDA

12.3

12.3

0.0%

15.4%

17.7

17.7

0.0%

43.9%

21.1

21.1

0.0%

19.3%

Payment EBITDA margin

33.4%

33.4%

0.0%

-3.2%

35.9%

35.9%

0.0%

2.4%

35.5%

35.5%

0.0%

-0.3%

Identity EBITDA margin

-85.0%

-85.7%

-0.7%

-6.5%

-52.8%

-52.8%

0.0%

32.9%

-18.3%

-18.3%

0.0%

34.4%

EBITDA margin

22.3%

22.3%

0.1%

1.0%

26.6%

26.6%

0.0%

4.3%

27.2%

27.2%

0.0%

0.5%

Total adjusted EBITDA

12.3

12.3

0.0%

66.1%

Adjusted EBITDA margin

22.3%

22.3%

0.1%

6.5%

Normalised operating profit

8.9

8.7

-1.5%

93.6%

13.5

13.5

0.0%

54.5%

16.8

16.8

0.0%

23.9%

Normalised operating margin

16.1%

15.9%

-0.2%

6.9%

20.4%

20.4%

0.0%

4.5%

21.6%

21.6%

0.0%

1.2%

Reported operating profit

(1.7)

(0.7)

-58.8%

-21.2%

6.4

6.6

2.0%

-1043%

10.5

10.9

3.6%

65.6%

Reported operating margin

-3.1%

-1.3%

1.8%

0.5%

9.7%

9.9%

0.2%

11.2%

13.5%

14.0%

0.5%

4.1%

Normalised PBT

7.9

8.0

1.2%

93.6%

12.3

12.3

0.0%

54.1%

15.6

15.6

0.0%

27.1%

Reported PBT

(2.7)

(1.5)

-45.1%

N/A

5.2

5.3

2.5%

-455.3%

9.3

9.7

4.0%

82.7%

Normalised net income

6.3

6.4

1.2%

96.1%

9.8

9.8

0.0%

54.1%

12.5

12.5

0.0%

27.1%

Reported net income

(2.6)

(1.5)

-43.2%

N/A

4.7

4.8

2.5%

-425.8%

7.9

8.2

4.0%

72.6%

Normalised basic EPS ($)

0.024

0.024

1.2%

81.3%

0.035

0.035

0.0%

46.2%

0.044

0.044

0.0%

27.1%

Normalised diluted EPS ($)

0.021

0.022

1.2%

79.9%

0.032

0.032

0.0%

46.9%

0.040

0.040

0.0%

27.1%

Reported basic EPS ($)

(0.010)

(0.005)

-43.2%

N/A

0.017

0.017

2.5%

-409.0%

0.028

0.029

4.0%

72.6%

Net debt/(cash)

(14.7)

(17.8)

21.3%

-45.4%

(31.3)

(34.4)

9.9%

93.3%

(51.4)

(54.5)

6.0%

58.2%

TPV ($bn)

6.56

6.56

0.0%

30.0%

7.82

7.82

0.0%

17.4%

8.87

8.87

0.0%

13.5%

Take rate

0.76%

0.76%

0.0%

-0.05%

0.76%

0.76%

0.0%

0.00%

0.74%

0.74%

0.0%

-0.02%

Source: Edison Investment Research. Note: adjusted revenue and EBITDA growth rates for FY20 exclude $3.3m one-off revenue reported in FY19.

Valuation

As we have done before, we look at the valuation on a sum-of-the-parts basis to reflect the different profiles of the Payments and Identity businesses. We use the peer group average EV/EBITDA multiple for FY21 (to reflect a full-year ownership of Fortumo) for the Payments business. For Identity, we use the value of the acquisition of $25m; this is conservative compared to peer valuations but reflects the fact that the business is currently loss-making. This generates an equity value for the group of $435m or 124p per share, compared to the current share price of 94.3p. Excluding the Identity business entirely, the group would be worth $426m or 117p per share, still well ahead of the current share price. When we last wrote (22 July), we estimated a group per-share value of 127p and, excluding Identity, 120p. While our EBITDA forecasts have not changed since then, the peer group multiple has reduced slightly, Boku’s net cash position has slightly increased and the US$/£ rate has moved from 1.27 to 1.29.

Exhibit 3: Peer group valuation metrics

Share price

Market cap

EV

EV/sales

EV/EBITDA

P/E

FCF yield

List ccy

Rep ccy

CY

NY

NY+1

CY

NY

NY+1

CY

NY

NY+1

CY

NY

NY+1

Boku

96.0

271

334

6.1

5.0

4.3

27.2

18.9

15.8

57.2

39.0

30.7

1.7%

5.7%

6.2%

Bango

156.5

116

115

9.7

N/A

N/A

35.9

N/A

N/A

92.1

N/A

N/A

-0.6%

N/A

N/A

Ingenico

140.6

8,941

10,577

3.7

3.3

3.2

17.8

15.8

14.9

29.3

25.8

23.7

3.4%

3.6%

N/A

Worldline

75.74

13,863

14,532

6.2

5.7

5.3

25.1

21.4

19.3

46.4

37.1

32.6

2.2%

3.2%

N/A

FIS

148.5

92,011

108,189

8.6

7.9

7.3

20.4

17.5

15.6

27.0

22.1

19.2

4.0%

4.3%

4.6%

Fiserv

96.43

64,571

87,279

6.2

5.8

5.4

16.0

13.8

12.5

21.9

17.9

15.3

6.1%

7.1%

N/A

Global Payments

169.15

50,617

58,712

8.7

7.7

7.0

19.3

16.4

14.7

26.6

21.2

18.1

3.3%

4.4%

N/A

PayPal

194.6

228,457

224,387

10.5

8.8

7.5

36.9

30.4

26.1

52.2

42.8

35.1

2.3%

2.4%

N/A

Square

144.21

63,962

63,501

8.5

6.6

5.3

202.6

92.2

62.5

258.5

119.2

82.9

-0.2%

-0.6%

N/A

Average payment processors

7.7

6.5

5.9

46.8

29.7

23.7

69.2

40.9

32.4

2.6%

3.5%

4.6%

Average payment processors excluding Square

7.6

6.5

6.0

24.5

19.2

17.2

42.2

27.8

24.0

3.0%

4.2%

4.6%

Equifax

167.7

20,368

23,437

6.0

5.9

5.5

17.7

16.9

15.1

28.2

27.2

23.1

N/A

N/A

N/A

Experian

2983.0

27,323

39,645

7.7

7.1

6.7

22.8

20.6

18.9

40.1

34.9

31.7

N/A

N/A

N/A

GB Group

715.0

1,393

1,435

8.0

7.2

6.6

39.3

30.4

27.3

54.6

41.2

35.0

2.0%

3.1%

4.0%

TransUnion

86.1

16,368

19,603

7.3

6.8

6.3

19.2

17.4

15.5

30.1

26.6

23.3

N/A

N/A

N/A

Average ID management

7.3

6.8

6.3

24.7

21.3

19.2

38.3

32.4

28.2

2.0%

3.1%

4.0%

Source: Edison Investment Research, Refinitiv (as at 10 September 2020)

Exhibit 4: Financial summary

$m

2014

2015

2016

2017

2018

2019

2020e

2021e

2022e

31-December

IFRS

IFRS

IFRS

IFRS

IFRS

IFRS

IFRS

IFRS

IFRS

INCOME STATEMENT

Revenue

 

 

18.3

19.2

17.2

24.4

35.3

50.1

55.1

66.4

77.7

Cost of Sales

(4.1)

(4.0)

(3.2)

(2.3)

(2.5)

(5.6)

(5.4)

(7.3)

(10.5)

Gross Profit

14.2

15.2

14.0

22.1

32.8

44.6

49.7

59.1

67.2

EBITDA

 

 

(9.6)

(11.4)

(12.3)

(2.3)

6.3

10.7

12.3

17.7

21.1

Normalised operating profit

 

 

(9.8)

(12.4)

(13.8)

(4.0)

4.8

4.5

8.7

13.5

16.8

Amortisation of acquired intangibles

(0.8)

(1.9)

(1.7)

(1.3)

(1.3)

(1.6)

(1.7)

(1.5)

(0.4)

Exceptionals

(2.1)

(0.1)

(2.4)

(2.2)

(1.4)

(0.3)

(0.8)

0.0

0.0

Share-based payments

(1.7)

(1.8)

(2.1)

(1.5)

(4.6)

(6.8)

(7.0)

(5.5)

(5.5)

Reported operating profit

(14.4)

(16.2)

(19.9)

(9.0)

(2.4)

(4.1)

(0.7)

6.6

10.9

Net Interest

(0.6)

(0.4)

(1.2)

(2.4)

(0.6)

(0.4)

(0.8)

(1.3)

(1.2)

Joint ventures & associates (post tax)

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

Exceptionals

0.0

0.0

0.0

(17.1)

0.0

0.0

0.0

0.0

0.0

Profit Before Tax (norm)

 

 

(10.4)

(12.8)

(15.0)

(6.4)

4.3

4.1

8.0

12.3

15.6

Profit Before Tax (reported)

 

 

(15.0)

(16.6)

(21.1)

(28.5)

(3.0)

(1.3)

(1.5)

5.3

9.7

Reported tax

(0.4)

(0.4)

0.5

(0.1)

(1.3)

1.7

0.0

(0.5)

(1.5)

Profit After Tax (norm)

(7.8)

(9.6)

(11.2)

(4.8)

3.4

3.2

6.4

9.8

12.5

Profit After Tax (reported)

(15.4)

(17.0)

(20.6)

(28.7)

(4.3)

0.4

(1.5)

4.8

8.2

Minority interests

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

Discontinued operations

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

Net income (normalised)

(7.8)

(9.6)

(11.2)

(4.8)

3.4

3.2

6.4

9.8

12.5

Net income (reported)

(15.4)

(17.0)

(20.6)

(28.7)

(4.3)

0.4

(1.5)

4.8

8.2

Basic ave. number of shares outstanding (m)

21.3

27.4

140.1

150.3

217.1

246.8

266.9

281.4

281.4

EPS - basic normalised ($)

 

 

(0.36)

(0.35)

(0.08)

(0.03)

0.02

0.01

0.02

0.03

0.04

EPS - diluted normalised ($)

 

 

(0.36)

(0.35)

(0.08)

(0.03)

0.02

0.01

0.02

0.03

0.04

EPS - basic reported ($)

 

 

(0.72)

(0.62)

(0.15)

(0.19)

(0.02)

0.00

(0.01)

0.02

0.03

Dividend ($)

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

Revenue growth (%)

#DIV/0!

4.7

(10.4)

42.0

44.5

42.2

10.0

20.4

16.9

Gross Margin (%)

77.6

79.1

81.4

90.7

92.9

88.9

90.2

89.1

86.5

EBITDA Margin (%)

(52.5)

(59.2)

(71.4)

(9.5)

17.9

21.3

22.3

26.6

27.2

Normalised Operating Margin

(53.2)

(64.4)

(80.0)

(16.5)

13.7

9.0

15.9

20.4

21.6

BALANCE SHEET

Fixed Assets

 

 

32.7

30.8

26.8

26.9

23.0

52.2

95.8

93.9

92.1

Intangible Assets

32.5

30.1

25.7

25.8

22.5

46.8

91.2

89.8

89.5

Tangible Assets

0.2

0.7

0.5

0.4

0.3

3.5

2.1

1.1

0.1

Investments & other

0.0

0.0

0.6

0.7

0.3

1.8

2.6

3.0

2.6

Current Assets

 

 

72.5

53.0

48.9

79.3

84.0

89.2

104.0

146.1

179.2

Stocks

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

Debtors

59.7

43.3

37.1

59.1

51.7

53.6

65.8

92.6

106.9

Cash & cash equivalents

12.0

9.0

11.3

18.7

31.1

34.7

37.3

52.7

71.5

Other

0.7

0.6

0.5

1.4

1.3

0.9

0.9

0.9

0.9

Current Liabilities

 

 

(69.6)

(65.5)

(61.0)

(78.0)

(79.6)

(81.8)

(93.5)

(124.7)

(143.6)

Creditors

(64.6)

(60.4)

(54.9)

(75.5)

(77.4)

(78.0)

(88.2)

(120.9)

(139.6)

Tax and social security

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

Short term borrowings

(5.0)

(5.1)

(6.1)

(2.5)

(2.2)

(2.1)

(3.3)

(3.3)

(3.3)

Other

0.0

0.0

0.0

(0.0)

0.0

(1.7)

(1.9)

(0.5)

(0.6)

Long Term Liabilities

 

 

0.0

(0.3)

(15.2)

(0.2)

(0.8)

(2.6)

(17.4)

(16.1)

(14.9)

Long term borrowings

0.0

(0.2)

(15.1)

(0.0)

0.0

0.0

(16.2)

(14.9)

(13.7)

Other long term liabilities

0.0

(0.1)

(0.1)

(0.1)

(0.8)

(2.6)

(1.2)

(1.2)

(1.2)

Net Assets

 

 

35.5

18.0

(0.4)

28.0

26.6

57.0

88.9

99.2

112.9

Minority interests

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

Shareholders' equity

 

 

35.5

18.0

(0.4)

28.0

26.6

57.0

88.9

99.2

112.9

CASH FLOW

Op Cash Flow before WC and tax

(9.6)

(11.4)

(12.3)

(2.3)

6.3

7.4

12.3

17.7

21.1

Working capital

9.3

11.6

(3.4)

1.0

7.2

3.0

(2.0)

5.9

4.4

Exceptional & other

(1.6)

1.1

4.2

(5.5)

0.2

(1.3)

(1.1)

0.0

0.0

Tax

(0.0)

(0.0)

(0.0)

0.0

(0.2)

(0.1)

(0.7)

(1.0)

(1.0)

Net operating cash flow

 

 

(1.9)

1.3

(11.5)

(6.8)

13.5

9.0

8.5

22.6

24.5

Capex

(1.1)

(3.6)

(1.5)

(0.3)

(0.3)

(2.1)

(2.5)

(2.7)

(2.8)

Acquisitions/disposals

5.9

0.3

0.0

0.0

(0.2)

(0.7)

(43.0)

0.0

0.0

Net interest

(0.3)

(0.3)

(0.3)

(0.9)

(0.6)

(0.4)

(0.6)

(1.2)

(1.1)

Equity financing

0.2

0.1

0.1

19.8

0.5

0.6

24.8

0.0

0.0

Dividends

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

Other

0.6

(0.0)

0.1

(1.1)

0.2

(1.5)

(1.9)

(2.1)

(0.6)

Net Cash Flow

3.3

(2.2)

(13.1)

10.6

13.1

4.857

(14.8)

16.6

20.0

Opening net debt/(cash)

 

 

(4.9)

(7.0)

(3.6)

9.9

(16.2)

(28.9)

(32.6)

(17.8)

(34.4)

FX

(1.2)

(0.8)

(0.4)

0.4

(0.5)

(1.1)

0.0

0.0

0.0

Other non-cash movements

0.0

(0.4)

(0.0)

15.1

(0.0)

(0.0)

0.0

0.0

0.0

Closing net debt/(cash)

 

 

(7.0)

(3.6)

9.9

(16.2)

(28.9)

(32.6)

(17.8)

(34.4)

(54.5)

Source: Boku, Edison Investment Research

General disclaimer and copyright

This report has been commissioned by Boku and prepared and issued by Edison, in consideration of a fee payable by Boku. Edison Investment Research standard fees are £49,500 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2020 Edison Investment Research Limited (Edison).

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

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Frankfurt +49 (0)69 78 8076 960

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London +44 (0)20 3077 5700

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United Kingdom

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1185 Avenue of the Americas

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United States of America

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Level 4, Office 1205

95 Pitt Street, Sydney

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Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

General disclaimer and copyright

This report has been commissioned by Boku and prepared and issued by Edison, in consideration of a fee payable by Boku. Edison Investment Research standard fees are £49,500 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2020 Edison Investment Research Limited (Edison).

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

The Investment Research is a publication distributed in the United States by Edison Investment Research, Inc. Edison Investment Research, Inc. is registered as an investment adviser with the Securities and Exchange Commission. Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

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