Last close As at 05/08/2026
EUR1.37
▲ −0.02 (−1.37%)
Market capitalisation
EUR274m
Research: TMT
MGI – Media and Games Invest (MGI) has been steadily gaining market share in a difficult trading environment. It is now the leading mobile open web supply-side platform (SSP) on both Android and iOS in North America; second on Android and fifth on iOS in EMEA. Continuing weak advertising pricing means that FY23 revenue guidance was pulled back at the interims, but careful cost management should ensure EBITDA is flat over FY22, with an annualised cost-saving programme of €10m also put in place. MGI’s fundamentals are positive, with its vertical integration giving an efficient market proposition and earlier acquisitions providing a sound basis for its connected TV offering. The withdrawal of personal identifiers on Google should give further impetus, which we feel is not yet reflected in the rating.
MGI – Media and Games Invest |
Building a major global adtech player |
Q223 results |
Software |
14 November 2023 |
Share price performance
Business description
Next events
Analysts
MGI – Media and Games Invest is a research client of Edison Investment Research Limited |
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MGI – Media and Games Invest (MGI) has been steadily gaining market share in a difficult trading environment. It is now the leading mobile open web supply-side platform (SSP) on both Android and iOS in North America; second on Android and fifth on iOS in EMEA. Continuing weak advertising pricing means that FY23 revenue guidance was pulled back at the interims, but careful cost management should ensure EBITDA is flat over FY22, with an annualised cost-saving programme of €10m also put in place. MGI’s fundamentals are positive, with its vertical integration giving an efficient market proposition and earlier acquisitions providing a sound basis for its connected TV offering. The withdrawal of personal identifiers on Google should give further impetus, which we feel is not yet reflected in the rating.
Year end |
Revenue |
Adjusted EBITDA* |
PBT* |
EPS* |
EV/EBITDA* (x) |
P/E |
12/21 |
252.2 |
71.2 |
26.9 |
19.8 |
6.8 |
4.2 |
12/22 |
324.4 |
93.2 |
30.3 |
13.5 |
5.2 |
6.2 |
12/23e |
303.0 |
93.2 |
20.8 |
9.5 |
5.2 |
8.7 |
12/24e |
325.5 |
102.5 |
32.9 |
15.4 |
4.5 |
5.4 |
Note: *PBT and EPS are normalised, excluding amortisation of acquired intangibles, exceptional items and share-based payments.
Q2 results reflect lower pricing, higher volumes
Q223 net revenues were down by 2% at €76.2m (organic growth of 1% adjusted for divestments and currency). Considering that management notes advertising prices in cost per mille as running at 20–25% lower than the prior year, this represents a very good uplift in volumes as the group grows its market share. An adjusted EBITDA margin of 28% (Q222: 27%) shows the resilience of the business model as volumes scale, as well as tight control of costs. Working capital was a net drain in H123 as receivables increased with more, larger publisher payments, but this should unwind in H223. End-June net leverage at 3.2x was slightly over the 2–3x target range but, again, should fall back within that range by the year-end. FY23 revenue guidance is now flat over FY22 (adjusted for divestments), with adjusted EBITDA guided to flat year-on-year, which implies a step up for full year margins.
Fundamental market changes give large opportunity
The programmatic adtech market is highly inefficient, with many layers of complexity each scraping a slice of cost. MGI, through its Verve brand, has built a vertically integrated solution that is gaining traction and growing share. We believe that many advertisers, publishers and intermediaries are ill-prepared for the upcoming withdrawal of Google cookies and that this presents Verve with a major opportunity to accelerate its presence with its established AI-driven solutions.
Valuation: Well below peers
Adtech shares have had mixed performances in 2023, with scale a clear benefit. MGI is now trading at a considerable discount to peers across pure adtech and relevant content categories. Parity of rating on EV/sales and EV/EBITDA across FY22–24e would see the price climb to €3.03 (from €3.57 in June).
Exhibit 1: Financial summary
€000s |
2021 |
2022 |
2023e |
2024e |
||
31-December |
IFRS |
IFRS |
IFRS |
IFRS |
||
INCOME STATEMENT |
||||||
Revenue |
|
|
252,166 |
324,444 |
303,000 |
325,515 |
Operating costs excl. D&A |
(187,124) |
(239,691) |
(217,897) |
(228,098) |
||
Adj. EBITDA |
|
|
71,216 |
93,153 |
93,215 |
102,529 |
EBITDA |
|
|
65,042 |
84,753 |
85,103 |
97,417 |
Operating profit (before amort. and excepts.) |
|
|
48,768 |
68,288 |
69,566 |
81,578 |
Amortisation of acquired intangibles |
(11,964) |
(14,853) |
(13,368) |
(13,368) |
||
Exceptionals |
(4,708) |
(27,100) |
(6,500) |
(3,500) |
||
Share-based payments |
(1,466) |
(1,613) |
(1,613) |
(1,613) |
||
Reported operating profit |
36,804 |
26,618 |
48,086 |
63,098 |
||
Net Interest |
(21,919) |
(37,983) |
(48,793) |
(48,684) |
||
Joint ventures & associates (post tax) |
0 |
0 |
0 |
0 |
||
Exceptionals |
1 |
0 |
0 |
0 |
||
Profit Before Tax (norm) |
|
|
26,850 |
30,304 |
20,773 |
32,895 |
Profit Before Tax (reported) |
|
|
14,887 |
(11,365) |
(707) |
14,414 |
Reported tax |
1,169 |
(9,064) |
0 |
(4,882) |
||
Profit After Tax (norm) |
28,018 |
21,194 |
14,114 |
23,393 |
||
Profit After Tax (reported) |
16,055 |
(20,429) |
(707) |
9,533 |
||
Minority interests |
(7) |
(88) |
(1,000) |
(1,200) |
||
Discontinued operations |
0 |
0 |
0 |
0 |
||
Net income (normalised) |
28,019 |
21,056 |
15,114 |
24,593 |
||
Net income (reported) |
16,061 |
(20,341) |
293 |
10,733 |
||
Average Number of Shares Outstanding (m) |
141.7 |
156.2 |
159.2 |
159.2 |
||
EPS - basic normalised (c) |
|
|
19.77 |
13.48 |
9.49 |
15.44 |
EPS - normalised fully diluted (c) |
|
|
19.77 |
12.07 |
8.52 |
13.86 |
EPS - basic reported (c) |
|
|
11.33 |
(13.02) |
0.18 |
6.74 |
Dividend (c) |
0.00 |
0.00 |
0.00 |
0.00 |
||
Revenue growth (%) |
179.8 |
28.7 |
(6.6) |
7.4 |
||
Adjusted EBITDA Margin (%) |
28.2 |
28.7 |
30.8 |
31.5 |
||
Normalised Operating Margin (%) |
19.3 |
21.0 |
23.0 |
25.1 |
||
BALANCE SHEET |
||||||
Fixed Assets |
|
|
650,495 |
823,637 |
831,854 |
844,828 |
Intangible Assets |
605,746 |
791,284 |
798,641 |
811,353 |
||
Tangible Assets |
4,681 |
5,522 |
6,382 |
6,644 |
||
Investments & other |
40,068 |
26,831 |
26,831 |
26,831 |
||
Current Assets |
|
|
283,598 |
221,022 |
222,702 |
247,303 |
Stocks |
0 |
0 |
0 |
0 |
||
Debtors |
97,497 |
65,085 |
54,789 |
58,860 |
||
Cash & cash equivalents |
180,156 |
149,992 |
161,968 |
182,498 |
||
Other |
5,945 |
5,945 |
5,945 |
5,945 |
||
Current Liabilities |
|
|
243,433 |
219,471 |
212,433 |
215,251 |
Creditors |
53,754 |
68,711 |
55,226 |
58,044 |
||
Short term borrowings |
32,020 |
31,903 |
39,644 |
39,644 |
||
Other financial liabilities |
137,611 |
97,515 |
97,515 |
97,515 |
||
Other non-financial liabilities |
20,048 |
21,342 |
20,048 |
20,048 |
||
Long Term Liabilities |
|
|
383,168 |
503,443 |
491,443 |
491,443 |
Long term borrowings |
343,925 |
389,386 |
382,386 |
382,386 |
||
Other long term liabilities |
39,243 |
114,057 |
109,057 |
109,057 |
||
Net Assets |
|
|
307,493 |
321,745 |
350,679 |
385,437 |
Minority interests |
(59) |
1,211 |
1,211 |
1,211 |
||
Shareholders' equity |
|
|
307,434 |
322,956 |
351,890 |
386,648 |
CASH FLOW |
||||||
Operating Cash Flow |
16,055 |
(20,429) |
(707) |
9,533 |
||
Depreciation & amortisation |
28,238 |
58,135 |
28,904 |
29,206 |
||
Working capital |
(5,714) |
55,284 |
(3,189) |
(1,253) |
||
Exceptional & other |
1,167 |
(2,755) |
1,613 |
1,613 |
||
Tax |
1,514 |
6,002 |
0 |
0 |
||
Net finance cost |
23,583 |
37,983 |
48,793 |
48,684 |
||
Net operating cash flow |
|
|
64,843 |
134,220 |
75,414 |
87,782 |
Capex |
(39,844) |
(46,007) |
(34,992) |
(35,051) |
||
Acquisitions/disposals |
(255,790) |
(138,000) |
5,159 |
(5,000) |
||
Equity financing |
109,338 |
27,900 |
0 |
0 |
||
Dividends |
0 |
0 |
0 |
0 |
||
Other |
(24,920) |
(53,413) |
(32,422) |
(26,861) |
||
Net Cash Flow |
(146,373) |
(75,300) |
13,159 |
20,870 |
||
Opening net debt/(cash) |
|
|
57,690 |
198,600 |
273,900 |
260,062 |
FX |
0 |
0 |
0 |
0 |
||
Other non-cash movements |
5,463 |
0 |
679 |
(340) |
||
Closing net debt/(cash) |
|
|
198,600 |
273,900 |
260,062 |
239,532 |
Source: Company accounts, Edison Investment Research
|
|
Research: Metals & Mining
Wheaton Precious Metals’ (WPM’s) Q323 profits exceeded our prior forecasts by US$4.0m (or 3.4%) at the pre-tax level and by US$4.2m (or 3.6%) at the post-tax level, driven by very strong production performances at Salobo and Constancia in particular. Production during the quarter amounted to 154,800oz gold equivalent ounces (GEOs) compared to our prior estimate of 151,919oz, as a consequence of which our FY23 production forecast remains within the company’s 600–660koz GEO guidance range, while our adjusted EPS forecast has changed by less than 1% (notwithstanding the cessation of lead and zinc concentrate production at Aljustrel until Q225).