Currency in SEK
Last close As at 09/06/2023
SEK34.75
▲ 1.05 (3.12%)
Market capitalisation
SEK2,368m
Research: Financials
We consider CoinShares International (CS) an attractively priced option on the prospective adoption of digital assets. We estimate that CS’s market capitalisation of £204m (on a fully diluted basis) is at present at least 85% covered by the sum of CS’s cash at bank (£13.9m at end-June 2022), net amounts from brokers (£38.1m) and the accrued management fees related to XBT Provider products (we estimate the current balance at c £120m). Moreover, CS is now trading at c 0.93x book value. With a steady fee income and good equity position, we think CS is well placed to be one of the beneficiary survivors of the current ‘crypto winter’.
CoinShares International |
An attractively priced option on crypto adoption |
Q222 results |
Financials |
10 August 2022 |
Share price performance
Business description
Next events
Analyst
CoinShares InternationalCoinShares International is a research client of Edison Investment Research Limited |
We consider CoinShares International (CS) an attractively priced option on the prospective adoption of digital assets. We estimate that CS’s market capitalisation of £204m (on a fully diluted basis) is at present at least 85% covered by the sum of CS’s cash at bank (£13.9m at end-June 2022), net amounts from brokers (£38.1m) and the accrued management fees related to XBT Provider products (we estimate the current balance at c £120m). Moreover, CS is now trading at c 0.93x book value. With a steady fee income and good equity position, we think CS is well placed to be one of the beneficiary survivors of the current ‘crypto winter’.
Year end |
Revenue |
Adjusted EBITDA* |
Adj. EPS** |
DPS |
P/E |
Yield |
12/20 |
18.4 |
22.1 |
0.28 |
0.00 |
10.1 |
0.0 |
12/21 |
80.9 |
121.7 |
1.64 |
0.00 |
1.7 |
0.0 |
12/22e |
49.3 |
20.0 |
0.25 |
0.00 |
11.3 |
0.0 |
12/23e |
36.1 |
31.5 |
0.28 |
0.00 |
10.1 |
0.0 |
Note: *Sum of revenue, income and gains from capital markets infrastructure and gains on
principal investments less administrative expenses excluding D&A. **Total comprehensive
income (excluding currency translation differences and fair value gain/(loss) on investments
recognised in other comprehensive income) per share attributable to the shareholders of the parent.
Remaining cautious in its capital markets activities
CS recognised a £17.7m loss from the TerraUSD (UST) collapse in Q222 (see our previous note for details ), resulting in a CoinShares Capital Markets (CSCM) loss of £11.4m during the quarter. Having said that, it has so far avoided any further significant losses from counterparty risk arising from the financial issues of several large players, which sent ripples across the digital asset industry. CS has successfully recalled most of its decentralised finance (DeFi) and fixed income positions and remains in a defensive mode in its capital markets activities for now.
CoinShares Physical continues to attract new funds
Meanwhile, the company further expanded its exchange traded products (ETP) suite (five products launched in Q222). While net outflows from the legacy XBT Provider products continued at c US$132m (vs US$246m in Q122), the CoinShares Physical platform recorded a minor positive net inflow in Q222, bringing the H122 net inflows to US$105m (excluding seed assets). We consider the above as an indication of sustained investor interest in digital asset exposure. CS’s equities platform saw US$60m net outflows, translating into H122 net inflows of US$35m. The decline in digital asset prices in Q222 reduced CS’s assets under management (AUM) to £1.66bn at end-June 2022 (vs £3.95bn at end-March 2022), resulting in asset management fees of £14.2m in Q222 (compared to £19.6m in Q221).
Valuation: Fair value at SEK80.0
We have reduced CS’s FY22 forecasts on the back of more muted CSCM activity but have retained our mid- to long-term digital asset allocation assumptions, arriving at a CS valuation of SEK80.0 per share (down from SEK85.0 previously).
Q222 results: £17.7m loss from the UST collapse
CS reported and adjusted EBITDA loss of £8.2m in Q222 (vs a £28.6m profit in Q221) and its adjusted net loss came in at £11.4m (vs a £26.6m profit in Q221), mostly due to a one-time loss of £17.7m arising from the UST stablecoin de-pegging (see our previous note for details). Its total comprehensive loss was minimal at £0.1m in Q222 (vs a £26.6m profit in Q221), assisted by a currency translation gain of £11.3m arising from the appreciation of the US dollar (in which CoinShares Capital Markets (Jersey) Limited is denominated) against sterling.
Exhibit 1: Q222 results highlights
£m, unless otherwise stated |
Q222 |
Q122 |
Q421 |
Q321 |
Q221 |
Revenue, of which: |
13.9 |
18.0 |
25.8 |
18.4 |
19.6 |
XBT Provider |
13.0 |
16.3 |
24.4 |
17.5 |
19.5 |
CoinShares Physical |
0.6 |
0.4 |
0.5 |
0.2 |
0.1 |
Equities platform |
0.6 |
0.5 |
0.6 |
0.6 |
- |
B2C* |
(0.1) |
0.7 |
0.3 |
- |
- |
Capital market infrastructure income/gains, of which: |
(11.4) |
10.1 |
16.2 |
8.4 |
14.7 |
Liquidity provisioning |
1.6 |
2.0 |
2.4 |
1.7 |
3.3 |
Delta Neutral Trading Strategies |
(1.3) |
0.6 |
5.3 |
2.6 |
9.1 |
Fixed income activities |
0.8 |
1.2 |
3.5 |
3.1 |
1.7 |
DeFi |
4.9 |
6.3 |
3.6 |
- |
- |
Other |
(17.4) |
0.1 |
1.5 |
1.0 |
0.5 |
Principal investment gains/(losses) |
(5.1) |
(0.1) |
0.7 |
4.8 |
4.1 |
Adj. administrative expenses |
(5.8) |
(9.2) |
(10.0) |
(5.7) |
(9.7) |
Adj. EBITDA |
(8.2) |
18.7 |
32.9 |
26.0 |
28.6 |
Adj. EBITDA margin |
N/A |
67.1% |
77.0% |
82.0% |
74.7% |
Depreciation and amortisation |
(0.7) |
(0.6) |
(0.5) |
(0.5) |
(0.1) |
Finance expense |
(2.4) |
(2.2) |
(2.9) |
(1.5) |
(1.6) |
Income taxes |
(0.1) |
0.1 |
0.3 |
(0.4) |
(0.3) |
Currency translation differences |
11.3 |
4.1 |
(0.4) |
2.6 |
(0.1) |
Total comprehensive income |
(0.1) |
20.2 |
29.5 |
26.2 |
26.6 |
Adjusted net income |
(11.4) |
16.1 |
29.7 |
N/A |
N/A |
Source: Company data; Note: *Acquired in December 2021.
CSCM: Moving into defence mode
CS recognised the loss on UST in its Capital Markets Infrastructure segment (under ‘other’ activities) but has so far avoided any further large losses from the contagion spreading recently across the digital asset markets, as it has no direct exposure to the troubled players such as Celsius, Three Arrows Capital, BlockFi or Voyager. The company has significantly reduced its DeFi positions, notably in institutional lending protocols such as Maple and TrueFi. Together with the lack of income from the Anchor protocol following the UST collapse in May, this translated into a decline in DeFi income to £4.9m in Q222 from £6.3m in Q122. CS has also successfully recalled most of its balances in its fixed income activities outside of DeFi to limit losses from defaulting counterparties (generating a £0.8m income in Q22 compared to £1.2m in Q122 and £1.7m in Q221). The CEO highlighted during the earnings call that most of the contagion in the form of counterparty risk arising from poor risk management of several large players in the sector has likely materialised. This particularly applies to Europe and the United States, while some incremental risk may still materialise in the case of Asian players.
Income from liquidity provisioning for the XBT Provider products was £1.6m, down from £2.0m in Q121 and £3.3m in Q221, influenced by lower digital asset prices. With most of the trading capital tied up in DeFi in the earlier part of the quarter, CSCM did not generate any meaningful income/gains from delta neutral strategies, where it booked a small loss of £1.3m in Q222. This arose from opening a long futures position to take advantage of historically low annualised premiums to maintain the required exposure related to XBT Provider products, with the potential to reduce CS’s interest expense and/or invest the cash in higher yielding strategies. The Value at Risk on CSCM’s derivative book stood at £125k at end-June 2022.
As a result of the above, CSCM reported a loss of £11.4m in Q222 (or a £6.3m profit excluding the UST loss). Together with the reduced capital markets activity, CS paid down all revolving credit lines it has with brokers. As a result, it had a net amount due from brokers of £38.1m at end-June 2022, compared to a net amount due to brokers of £205.2m at end-March 2022. We understand that CSCM has remained cautious in terms of activity so far in Q322, which if sustained would result in a significant reduction in interest expense.
Asset management: AUM and fees lower, but inflows into CoinShares Physical continue
CS booked £14.2m in asset management revenue in Q222 (vs £19.6m in Q221). The vast majority of fees still comes from the legacy XBT Provider products (£13.0m in Q222), but with gradually increasing importance of the CoinShares Physical platform and the equities platform (£0.6m each).
We note that despite the turmoil in the digital asset markets, CoinShares Physical enjoyed net inflows of US$105m (excluding seed assets) in H122, of which US$86m was in Q122. We believe that this demonstrates the strength of the platform’s value proposition. During the quarter, CS launched five new products based on the following assets: FTX Token, Chainlink, Uniswap, Matic and Cosmos (the last two with embedded staking mechanism), bringing its current suite within CoinShares Physical to 14 products. We estimate that all the new CoinShares Physical products launched in 2022 year to date had a combined AUM of c US$66m at end-June 2022 (of which c 84% are seed assets of Solana and FTX Token ETPs provided by FTX). Net outflows from XBT Provider seen throughout FY21 and in Q122 continued in Q222 at around US$132m (vs US$246m in Q122), according to our calculations. The decline in net outflows is likely driven by lower digital asset prices, but also may have been driven by the declining share of unit holders who invested before the latest bull run, which started in 2020. CS’s equities platform saw a c US$60m net outflow in Q222, bringing the H122 balance to c US$35m of net inflows.
CS’s AUM stood at £1.66bn at end-June 2022, of which 58% was attributable to XBT Provider, 8% to CoinShares Physical and 34% to the equities platform. This represents a decrease from £3.95bn at end-March 2022, affected by the decline in digital asset prices, and has translated into lower custody fees, resulting in lower direct costs of CS’s asset management platform at US$0.5m in Q222 vs US$1.4m in Q122. Coupled with a reduction in administrative expenses to £1.1m in Q222, from £1.9m in Q221, this translated into a still robust operating profit of the segment of £12.6m (vs £16.3m in Q221).
Principal investments: Write-downs of 3iQ and Solana tokens
Both CS’s equity investments and proprietary digital asset holdings were written down during the quarter, resulting in a principal investments loss of £5.1m in Q222 (vs a £4.1m gain in Q221). Major drivers were 3iQ Asset Management (revalued downwards by c US$3.5m in Q222 to US$2.5m), whose valuation was affected by the fall in AUM amid lower digital asset prices, as well as CS’s proprietary holdings of Solana tokens (down by c US$1.4m to US$0.7m). This was partially offset by c US$0.6m of carried interest from CoinShares Fund II booked in Q222 (US$3.0m in total in H122).
The largest holding within CS’s principal investments portfolio remains its 32.06% stake in the online bank, FlowBank, which is basically a Swiss provider of online trading services with a local banking licence. Its carrying value at end-June 2022 was US$29.1m (out of CS’s total portfolio of US$44.2m) and the stake is accounted for using the equity method. During a recent interview (released on 25 May 2022), FlowBank’s CEO highlighted that he expects the company to be profitable on a monthly basis starting from the second half of 2022 or even earlier (possibly in May/June). In Q222, CS recognised a minor £0.1m loss from its share of joint venture and associate profits/(losses), which we understand consists primarily of its stake in FlowBank and Gold Token SA.
B2C: Development in progress
CS continued the integration of the Napoleon Group (acquired in Q421) and successfully launched a beta version of NapBots (trading bots) on 11 July 2022, with a formal relaunch and rebranding planned for Q322. Furthermore, on 4 July 2022, CS completed the acquisition of Napoleon Asset Management, the first crypto asset manager in Europe with an Alternative Investment Fund Managers Directive licence. Management highlighted that the B2C platform remains in its infancy and that the £0.8m operating loss in Q222 is a function of costs incurred to drive growth of this business line.
Forecast revisions and valuation update
We have retained our mid- to long-term digital asset adoption assumptions, as we see enough evidence that digital assets have established themselves as another distinct asset class. Further adoption signs include the recent deal signed by BlackRock with Coinbase to provide its clients access to digital assets (by connecting Coinbase to its Aladdin platform). Consequently, we have made only limited adjustments to our FY25e forecasts, with our new adjusted EBITDA expectation down 10.8% vs our previous forecasts published in June. For FY22, however, we have reduced our adjusted EBITDA forecast from £41.0m to £20.0m, primarily due to lower CSCM income/gains (£6.9m vs £31.8m previously) given the lower Q222 results compared to our expectations (even though the latter accounted for the UST loss) and CS’s expected muted trading activity in Q322. We assume a gradual pick-up in CSCM activity from Q422, but expect somewhat lower income and gains in FY23e and FY24e, as we factor in more moderate activity in the broad digital asset markets compared to FY21 following the current ‘crypto winter’. The weaker CSCM forecast for FY22 is partially offset by lower administrative cost assumptions given the reversal of bonus accruals CS booked in Q222 and more limited direct costs amid lower CSCM activity and AUM of CS’s asset management business (translating into reduced trading fees and custody fees, respectively).
We now arrive at CS’s fair value per share of SEK80.0 based on our discounted cash flow (DCF) model (compared to SEK85.0 previously). This implies a significant upside to CS’s current share price of SEK34.65. Consequently, we believe that CS represents an attractively priced option on the prospective digital assets adoption. We estimate that CS’s market capitalisation of £204m (on a fully diluted basis) is at present at least 85% covered by the sum of CS’s cash at bank (£13.9m at end-June 2022), net amounts from brokers (£38.1m) and the accrued management fees related to XBT Provider products (we estimate the current balance at c £120m). Moreover, CS is now trading at c 0.93x book value. With a steady fee income and good equity position (£220.9m at end-June 2022), we think CS is well-placed to be one of the beneficiary survivors of the current ‘crypto winter’.
We note that the upgrade of the Ethereum network (often referred to as ‘The Merge’), which will involve migrating the network from a proof-of-work to a proof-of-stake (PoS) consensus algorithm, is now scheduled for September. We believe that, in line with other CoinShares Physical ETPs based on PoS blockchains, CS is likely to offer a fixed percentage staking yield to Ethereum ETP holders at some stage, retaining any excess yield. However, at this stage we do not account for any excess staking yields CS could earn on its CoinShares Physical Ethereum ETP AUM, given the limited visibility in terms of the exact staking yields on the Ethereum network following The Merge (which will depend, among others, on the proportion of total Ether (ETH) supply being staked on the network). For illustrative purpose, we estimate that every 10bp excess yield on CoinShares Physical Ethereum ETP AUM would raise our CS valuation by c 1.5%.
Exhibit 2: Summary of forecast revisions
|
FY21 |
FY22e |
FY23e |
FY24e |
FY25e |
||||||||
|
Actual |
Old |
New |
diff (%) |
Old |
New |
diff (%) |
Old |
New |
diff (%) |
Old |
New |
diff (%) |
Revenue, of which: |
80.9 |
51.9 |
49.3 |
(5.1) |
37.1 |
36.1 |
(2.7) |
48.6 |
49.1 |
0.9 |
69.4 |
73.2 |
5.5 |
XBT Provider |
78.5 |
44.7 |
43.1 |
(3.7) |
29.1 |
25.2 |
(13.4) |
34.7 |
30.5 |
(11.9) |
41.6 |
37.0 |
(11.0) |
CoinShares Physical & other * |
0.9 |
2.4 |
3.0 |
25.6 |
4.3 |
7.6 |
76.2 |
9.4 |
14.3 |
52.3 |
22.1 |
30.9 |
39.5 |
Equities platform |
1.2 |
2.2 |
1.9 |
(10.4) |
2.3 |
1.9 |
(16.9) |
2.8 |
2.5 |
(10.2) |
3.4 |
3.0 |
(10.2) |
B2C |
0.3 |
2.6 |
1.2 |
(52.9) |
1.4 |
1.4 |
(0.6) |
1.8 |
1.8 |
(0.6) |
2.3 |
2.3 |
(0.6) |
Capital market infrastructure income/gains, of which: |
62.1 |
31.8 |
6.2 |
(80.6) |
51.9 |
35.9 |
(30.8) |
59.9 |
44.0 |
(26.5) |
68.8 |
54.9 |
(20.2) |
Liquidity provisioning |
13.8 |
7.7 |
6.6 |
(15.1) |
4.6 |
5.5 |
18.8 |
6.5 |
5.7 |
(13.3) |
8.4 |
4.6 |
(44.8) |
Delta Neutral Trading Strategies |
27.2 |
10.9 |
0.5 |
(95.0) |
19.0 |
16.0 |
(15.9) |
23.3 |
21.7 |
(7.0) |
27.5 |
30.7 |
11.6 |
Fixed income activities |
10.9 |
6.7 |
2.5 |
(62.7) |
6.8 |
2.5 |
(62.7) |
6.8 |
2.5 |
(62.7) |
6.9 |
2.6 |
(62.7) |
DeFi |
3.6 |
4.0 |
13.9 |
246.3 |
18.8 |
11.5 |
(38.6) |
19.7 |
13.8 |
(29.8) |
20.7 |
16.6 |
(19.8) |
Other |
6.6 |
2.5 |
(17.4) |
NM |
2.7 |
0.3 |
(87.5) |
3.6 |
0.3 |
(90.4) |
5.3 |
0.3 |
(93.4) |
Principal investment gains/(losses) |
9.6 |
(0.1) |
(5.3) |
NM |
0.0 |
0.0 |
N/A |
0.0 |
0.0 |
N/A |
0.0 |
0.0 |
N/A |
Administrative expenses excluding D&A |
(31.1) |
(42.4) |
(30.3) |
(28.4) |
(46.1) |
(40.2) |
(12.9) |
(50.6) |
(46.8) |
(7.5) |
(56.6) |
(55.0) |
(2.8) |
Adj. EBITDA |
121.7 |
41.0 |
20.0 |
(51.4) |
42.6 |
31.5 |
(26.0) |
57.2 |
45.5 |
(20.5) |
79.9 |
71.3 |
(10.8) |
Total comprehensive income |
110.5 |
33.9 |
18.2 |
(46.4) |
29.0 |
20.3 |
(29.9) |
42.1 |
33.7 |
(20.0) |
62.0 |
57.0 |
(8.2) |
Source: Company data, Edison Investment Research. Note: *Includes fees from CoinShares Physical, 3iQ and Invesco
Exhibit 3: Financial summary
Year ending December, £000’s unless otherwise stated |
FY18 |
FY19 |
FY20 |
FY21 |
FY22e |
FY23e |
FY24e |
FY25e |
Income Statement |
|
|
|
|
|
|
|
|
Revenues |
10,549 |
11,331 |
18,389 |
80,892 |
49,278 |
36,107 |
49,080 |
73,177 |
Administrative expenses |
(10,927) |
(9,284) |
(14,312) |
(32,167) |
(32,560) |
(42,399) |
(49,071) |
(57,234) |
Other operating income |
4,811 |
529 |
607 |
11,427 |
18,427 |
19,349 |
20,316 |
21,332 |
Profit/(loss) on financial instruments |
519,988 |
(64,553) |
(1,398,436) |
(2,236,196) |
1,905,694 |
(1,141,829) |
(790,728) |
(2,223,823) |
Realised gain/(loss) on investments |
(1,074) |
(405) |
942 |
5,287 |
(5,574) |
0 |
0 |
0 |
Adj. EBITDA |
12,993 |
11,171 |
22,113 |
121,688 |
19,950 |
31,480 |
45,463 |
71,310 |
EBIT |
523,347 |
(62,382) |
(1,392,810) |
(2,170,757) |
1,935,113 |
(1,128,772) |
(770,404) |
(2,186,547) |
Finance income |
693 |
931 |
3,793 |
10,905 |
10,356 |
7,132 |
8,079 |
9,211 |
Finance expense |
(148) |
(404) |
(1,191) |
(6,810) |
(7,245) |
(8,927) |
(9,494) |
(12,107) |
Pre-tax profit |
523,892 |
(61,855) |
(1,390,208) |
(2,166,662) |
1,938,223 |
(1,130,567) |
(771,819) |
(2,189,443) |
Income taxes |
(230) |
(269) |
(401) |
(1,284) |
0 |
0 |
0 |
0 |
Net income |
523,662 |
(62,124) |
(1,390,610) |
(2,167,946) |
1,938,223 |
(1,130,567) |
(771,819) |
(2,189,443) |
Total comprehensive income |
14,407 |
8,914 |
18,419 |
114,346 |
18,168 |
20,308 |
33,724 |
56,957 |
Reported EPS (diluted, £) |
N/A |
N/A |
(21.68) |
(32.62) |
26.77 |
(15.62) |
(10.66) |
(30.24) |
Adjusted EPS (diluted, £)* |
N/A |
N/A |
0.28 |
1.64 |
0.25 |
0.28 |
0.47 |
0.79 |
DPS (£) |
0.00 |
0.00 |
0.00 |
0.00 |
0.00 |
0.00 |
0.00 |
0.00 |
Balance Sheet |
|
|
|
|
|
|
|
|
Property, plant and equipment |
214 |
376 |
223 |
510 |
510 |
577 |
714 |
922 |
Digital assets |
N/A |
N/A |
N/A |
N/A |
2,495 |
2,495 |
2,495 |
2,495 |
Intangible assets |
0 |
7 |
20 |
19,781 |
18,908 |
18,035 |
17,162 |
16,289 |
Investments |
6,158 |
5,585 |
3,626 |
24,501 |
41,536 |
41,536 |
41,536 |
41,536 |
Long term receivables and other |
15 |
323 |
329 |
581 |
1,360 |
1,360 |
1,360 |
1,360 |
Non-current assets |
6,387 |
6,290 |
4,199 |
45,372 |
64,810 |
64,004 |
63,268 |
62,603 |
Trade and other receivables |
9,350 |
27,011 |
62,274 |
1,075,971 |
551,054 |
775,790 |
959,232 |
1,537,196 |
Digital assets |
217,521 |
427,524 |
1,826,695 |
2,736,481 |
953,360 |
1,645,463 |
2,112,714 |
3,803,550 |
Cash at bank |
32,897 |
2,350 |
2,266 |
11,088 |
5,542 |
19,608 |
91,295 |
98,308 |
Amounts due from brokers |
N/A |
39,405 |
66,518 |
118,976 |
42,869 |
78,159 |
102,226 |
186,941 |
Current assets |
259,767 |
496,290 |
1,957,752 |
3,942,516 |
1,552,824 |
2,519,020 |
3,265,467 |
5,625,994 |
Total assets |
266,154 |
502,580 |
1,961,951 |
3,987,888 |
1,617,634 |
2,583,024 |
3,328,735 |
5,688,597 |
Share capital |
2,214 |
2,215 |
31 |
34 |
34 |
34 |
34 |
34 |
Share premium |
111 |
111 |
2,387 |
30,781 |
30,781 |
30,781 |
30,781 |
30,781 |
Other reserves |
104,322 |
168,813 |
1,209,630 |
667,846 |
(1,252,209) |
(101,334) |
704,208 |
2,950,609 |
Retained earnings |
(68,003) |
(125,795) |
(1,155,551) |
(497,727) |
1,440,496 |
309,929 |
(461,890) |
(2,651,334) |
Total equity |
38,644 |
45,343 |
56,497 |
200,934 |
219,101 |
239,409 |
273,133 |
330,090 |
Trade payables and other liabilities |
227,469 |
419,340 |
1,792,936 |
3,491,612 |
1,127,156 |
2,055,049 |
2,687,851 |
4,915,273 |
Amounts due to brokers |
N/A |
37,631 |
112,121 |
292,708 |
270,517 |
287,707 |
366,892 |
442,375 |
Lease liabilities |
0 |
0 |
0 |
0 |
859 |
859 |
859 |
859 |
Current tax liabilities |
42 |
266 |
398 |
2,635 |
0 |
0 |
0 |
0 |
Current liabilities |
227,510 |
457,237 |
1,905,454 |
3,786,955 |
1,398,533 |
2,343,615 |
3,055,602 |
5,358,507 |
Non-current liabilities |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
Total equity and liabilities |
266,154 |
502,580 |
1,961,951 |
3,987,888 |
1,617,634 |
2,583,024 |
3,328,735 |
5,688,597 |
Ratios |
|
|
|
|
|
|
|
|
Adj. EBITDA margin |
52.1% |
54.0% |
62.8% |
85.1% |
36.0% |
43.7% |
48.8% |
55.7% |
Adj. net margin |
59.4% |
38.4% |
47.6% |
80.0% |
32.8% |
28.2% |
36.2% |
44.5% |
Source: Company data, Edison Investment Research. Note: *Total comprehensive income (excluding currency translation differences and fair value gain/(loss) on investments recognised in other comprehensive income) per share attributable to shareholders of the parent.
|
|
Research: TMT
4imprint’s first half results show the benefit of record levels of customer demand, with revenue up 58% year-on-year and operating profit rising from $3.6m in H121 to $44.0m in H122. July’s trading update had indicated FY22 revenue breaking through management’s long-held $1bn target, with a material uplift in operating profit to over $75m. With H122 revenue per marketing dollar at $8.19, up from $5.46 in H121, we have substantially raised our profit forecasts for FY22 and FY23 and now publish our first thoughts on FY24. The group continues to invest in its product and people as well as its marketing and generates significant amounts of cash, giving it an excellent opportunity to continue to build market share.
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