Last close As at 05/08/2026
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EUR35m
Research: TMT
Claranova has reported another strong quarter of revenue growth in Q121, with reported revenue up 29% y-o-y and organic, constant currency revenue up 23% y-o-y. PlanetArt was the driver of growth, with good performance from the original photo-printing business and the acquired personalised gifts business. We have increased our revenue forecasts to reflect Q1 performance but due to the high level of uncertainty caused by COVID-19, we maintain our EBITDA forecasts for FY21 and FY22.
Claranova |
Demand held up in Q121 |
Q121 revenue update |
Software & comp services |
5 November 2020 |
Share price performance
Business description
Next events
Analyst
Claranova is a research client of Edison Investment Research Limited |
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Claranova has reported another strong quarter of revenue growth in Q121, with reported revenue up 29% y-o-y and organic, constant currency revenue up 23% y-o-y. PlanetArt was the driver of growth, with good performance from the original photo-printing business and the acquired personalised gifts business. We have increased our revenue forecasts to reflect Q1 performance but due to the high level of uncertainty caused by COVID-19, we maintain our EBITDA forecasts for FY21 and FY22.
Year end |
Revenue (€m) |
EBITDA** |
PBT* |
Diluted EPS* |
DPS |
P/E |
06/19 |
262.3 |
16.0 |
12.0 |
0.25 |
0.0 |
24.2 |
06/20 |
409.1 |
17.4 |
11.3 |
0.20 |
0.0 |
29.8 |
06/21e |
488.0 |
27.4 |
21.0 |
0.30 |
0.0 |
20.2 |
06/22e |
557.0 |
36.8 |
30.4 |
0.44 |
0.0 |
13.5 |
Note: *PBT and EPS are normalised, excluding amortisation of acquired intangibles, exceptional items and share-based payments. **Pre-IFRS 16.
PlanetArt drives organic growth
Group organic constant currency growth of 23% came mainly from PlanetArt (+32%, 77% of group revenue) with a small contribution from myDevices (+111%, 1% of group revenue), partially offset by a 2% decline for Avanquest (22% of group revenue). PlanetArt saw continued strong demand for photo printing and 50% like-for-like growth in the personalised gifts business. Avanquest has substantially completed the shift from upfront to subscription licensing for its proprietary software products, which has depressed revenue growth and profitability in recent quarters. From this point, growth should start to accelerate and margins improve.
Raising revenue forecasts; maintaining EBITDA
Reflecting the better-than-expected performance of PlanetArt and slightly lower-than-expected growth of Avanquest, we have increased our group revenue forecasts by 1.2% for FY21 and FY22. Taking into account COVID-19-related uncertainty in Claranova’s seasonally strongest quarter (CYQ4), we cautiously maintain our EBITDA forecasts.
Valuation: Sum of the parts suggests upside
Reflecting the different business models and minority interests for each division, we continue to use a sum-of-the-parts approach to valuation. Based purely on peer-group averages per division, we calculate a fair value of €15.9 per share. However, once multiples are adjusted to reflect our views on the growth and profitability of each division, we calculate what we believe to be a more realistic valuation of €12.12 per share (unchanged since our last note). Factors that could provide upside to our estimates would be sustained high demand for photo printing, successful adoption of the FreePrints Gift app in the US and returning recent acquisitions to profitability.
Quarterly revenue update
Claranova reported 29% y-o-y revenue growth in Q121. On an organic basis, group revenue grew 19% y-o-y; at constant currency this increased to 23%.
Exhibit 1: Quarterly revenue by division
Revenues (€m) |
Q121 |
Q120 |
y-o-y |
y-o-y |
y-o-y |
Reported (%) |
Organic (%) |
Constant ccy, organic (%) |
|||
PlanetArt |
69 |
48 |
43 |
29 |
32 |
Avanquest |
20 |
21 |
(6) |
(6) |
(2) |
myDevices |
1 |
1 |
100 |
100 |
111 |
Total |
90 |
70 |
29 |
19 |
23 |
Source: Claranova
On a divisional basis:
■
PlanetArt: the division saw 32% growth on an organic, constant currency basis (Q120: 30%, Q420: 53%). The high levels of demand experienced in Q420 (which covered much of the lockdown periods in Europe and the US) continued into Q121. With further lockdowns being implemented across Europe, this could support elevated demand in Q221. Personal Creations contributed two months of revenue in Q120 and CafePress only contributed one month of revenue in Q121. The company noted the personalised gifts business grew 50% on a like-for-like basis, which implies that under Claranova’s ownership the Personal Creations business is performing well.
■
Avanquest: in Q121, revenue declined 6% y-o-y or 2% on a constant currency basis. The business has been shifting key software lines from upfront to subscription licensing, which has supressed revenue growth over the last year. In the case of SodaPDF and InPixio this transition is complete, with 82% and 72% of revenue, respectively, from subscription licences, and double-digit revenue growth in Q121. Recurring revenue made up 54% of revenue in Q121 compared to 46% in Q420. The company noted that lower margin, non-strategic activities continued to decline, in particular, sales of third-party, physical software and sales through partner channels.
■
myDevices: divisional revenues doubled year-on-year, representing mainly non-recurring revenue from commercial partners in the US. COVID-19 restrictions have made it difficult for customers in the hospitality sector to install internet-of-things devices but we believe that once restrictions are removed, demand should return.
Outlook and changes to forecasts
Management commented it remains fully focused on maintaining the current positive momentum, despite the recent renewed lockdowns in most countries of operation. CYQ4 is typically the strongest quarter for Claranova, particularly in the PlanetArt division, and it remains to be seen what impact the pandemic will have on demand and logistics (cost and speed of delivery). Despite these uncertainties, management expects to be able to maintain its track record of strong and profitable growth.
We have revised our FY21 and FY22 revenue forecasts to reflect the stronger Q1 performance by Planet Art and slightly lower revenues for Avanquest. Bearing in mind the uncertainties around Q221 trading, we maintain our EBITDA forecasts.
Exhibit 2: Changes to forecasts
€'m |
FY21e |
FY21e |
FY22e |
FY22e |
|||||
Old |
New |
Change |
y-o-y |
Old |
New |
Change |
y-o-y |
||
Revenues |
482.4 |
488.0 |
1.2% |
19.3% |
550.6 |
557.0 |
1.2% |
14.1% |
|
EBITDA |
30.6 |
30.6 |
0.0% |
48.5% |
40.0 |
40.0 |
0.0% |
30.7% |
|
EBITDA margin |
6.3% |
6.3% |
(0.1%) |
1.2% |
7.3% |
7.2% |
(0.1%) |
0.9% |
|
EBITDA - pre IFRS 16 |
27.4 |
27.4 |
0.0% |
57.1% |
36.8 |
36.8 |
0.0% |
34.3% |
|
EBITDA margin - pre IFRS 16 |
5.7% |
5.6% |
(0.1%) |
1.4% |
6.7% |
6.6% |
(0.1%) |
1.0% |
|
Normalised operating profit |
25.7 |
25.7 |
0.0% |
62.7% |
35.1 |
35.1 |
0.0% |
36.6% |
|
Normalised operating profit margin |
5.3% |
5.3% |
(0.1%) |
1.4% |
6.4% |
6.3% |
(0.1%) |
1.0% |
|
Reported operating profit |
19.4 |
19.4 |
0.0% |
148.7% |
31.8 |
31.8 |
0.0% |
63.9% |
|
Reported operating margin |
4.0% |
4.0% |
0.0% |
2.1% |
5.8% |
5.7% |
(0.1%) |
1.7% |
|
Normalised PBT |
21.0 |
21.0 |
0.0% |
85.5% |
30.4 |
30.4 |
0.0% |
44.8% |
|
Reported PBT |
14.7 |
14.7 |
0.0% |
344.3% |
27.1 |
27.1 |
0.0% |
84.6% |
|
Normalised net income |
11.8 |
11.8 |
0.0% |
47.4% |
17.7 |
17.7 |
0.0% |
50.2% |
|
Reported net income |
6.9 |
6.9 |
0.0% |
1287.8% |
15.2 |
15.2 |
0.0% |
118.6% |
|
Normalised basic EPS (€) |
0.30 |
0.30 |
0.0% |
47.4% |
0.45 |
0.45 |
0.0% |
50.2% |
|
Normalised diluted EPS (€) |
0.30 |
0.30 |
0.0% |
47.4% |
0.44 |
0.44 |
0.0% |
50.2% |
|
Reported basic EPS (€) |
0.18 |
0.18 |
0.0% |
1287.8% |
0.39 |
0.39 |
0.0% |
118.6% |
|
Net debt/(cash) |
(22.1) |
(22.6) |
2.3% |
62.7% |
(48.9) |
(49.5) |
1.1% |
118.8% |
|
Divisional revenues |
|||||||||
PlanetArt |
377.2 |
386.4 |
2.5% |
23.1% |
432.6 |
442.9 |
2.4% |
14.6% |
|
Avanquest |
99.7 |
96.0 |
(3.7%) |
6.3% |
111.7 |
107.8 |
(3.5%) |
12.3% |
|
myDevices |
5.6 |
5.6 |
0.0% |
16.7% |
6.3 |
6.3 |
0.0% |
12.5% |
|
Total |
482.4 |
488.0 |
1.2% |
19.3% |
550.6 |
557.0 |
1.2% |
14.1% |
|
Divisional EBITDA |
|||||||||
PlanetArt |
19.5 |
19.5 |
0.0% |
38.1% |
27.0 |
27.0 |
0.0% |
38.5% |
|
Avanquest |
11.3 |
11.3 |
(0.0%) |
57.8% |
13.0 |
13.0 |
0.0% |
15.0% |
|
myDevices |
(3.4) |
(3.4) |
0.0% |
(11.5%) |
(3.2) |
(3.2) |
0.0% |
(5.9%) |
|
Total EBITDA - pre IFRS 16 |
27.4 |
27.4 |
0.0% |
57.1% |
36.8 |
36.8 |
0.0% |
34.3% |
Source: Edison Investment Research
Exhibit 3: Financial summary
€'m |
2015 |
2016 |
2017 |
2018 |
2019 |
2020 |
2021e |
2022e |
||
30-June |
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
||
INCOME STATEMENT |
||||||||||
Revenue |
|
|
93.1 |
117.4 |
130.2 |
161.5 |
262.3 |
409.1 |
488.0 |
557.0 |
EBITDA |
|
|
(6.8) |
(9.2) |
(5.0) |
3.9 |
16.0 |
20.6 |
30.6 |
40.0 |
Normalised operating profit |
|
|
(11.4) |
(16.0) |
(5.8) |
3.4 |
15.5 |
15.8 |
25.7 |
35.1 |
Amortisation of acquired intangibles |
0.0 |
0.0 |
0.0 |
0.0 |
(1.5) |
(2.4) |
(3.3) |
(3.3) |
||
Exceptionals |
15.6 |
(10.0) |
0.4 |
(2.4) |
(2.9) |
(5.6) |
(3.0) |
0.0 |
||
Share-based payments |
(0.0) |
(0.1) |
(4.8) |
(7.1) |
0.3 |
0.0 |
0.0 |
0.0 |
||
Reported operating profit |
4.2 |
(26.1) |
(10.1) |
(6.1) |
11.4 |
7.8 |
19.4 |
31.8 |
||
Net Interest |
1.1 |
(1.7) |
(0.9) |
(0.3) |
(3.5) |
(4.5) |
(4.7) |
(4.7) |
||
Joint ventures & associates (post tax) |
0.0 |
(0.0) |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
||
Exceptionals |
0.0 |
0.0 |
0.0 |
0.0 |
(45.6) |
0.0 |
0.0 |
0.0 |
||
Profit Before Tax (norm) |
|
|
(10.3) |
(17.7) |
(6.6) |
3.1 |
12.0 |
11.3 |
21.0 |
30.4 |
Profit Before Tax (reported) |
|
|
5.3 |
(27.8) |
(11.0) |
(6.4) |
(37.7) |
3.3 |
14.7 |
27.1 |
Reported tax |
(0.6) |
(0.8) |
(0.4) |
(1.8) |
(3.7) |
(2.1) |
(3.4) |
(6.2) |
||
Profit After Tax (norm) |
(10.9) |
(18.5) |
(7.0) |
2.4 |
9.2 |
8.7 |
16.1 |
23.4 |
||
Profit After Tax (reported) |
4.7 |
(28.6) |
(11.4) |
(8.2) |
(41.4) |
1.2 |
11.3 |
20.8 |
||
Minority interests |
(8.1) |
0.0 |
0.3 |
0.2 |
0.6 |
(0.7) |
(4.4) |
(5.7) |
||
Discontinued operations |
(3.2) |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
||
Net income (normalised) |
(18.9) |
(18.5) |
(6.7) |
2.6 |
9.8 |
8.0 |
11.8 |
17.7 |
||
Net income (reported) |
(6.5) |
(28.6) |
(11.0) |
(7.9) |
(40.8) |
0.5 |
6.9 |
15.2 |
||
Basic ave. number of shares outstanding (m) |
6 |
38 |
38 |
39 |
39 |
39 |
39 |
39 |
||
EPS - basic normalised (€) |
|
|
(3.27) |
(0.49) |
(0.18) |
0.07 |
0.25 |
0.20 |
0.30 |
0.45 |
EPS - diluted normalised (€) |
|
|
(3.27) |
(0.49) |
(0.18) |
0.06 |
0.25 |
0.20 |
0.30 |
0.44 |
EPS - basic reported (€) |
|
|
(1.13) |
(0.76) |
(0.29) |
(0.20) |
(1.04) |
0.01 |
0.18 |
0.39 |
Dividend (€) |
0.00 |
0.00 |
0.00 |
0.00 |
0.00 |
0.00 |
0.00 |
0.00 |
||
Revenue growth (%) |
- |
26.1 |
10.9 |
24.0 |
62.4 |
56.0 |
19.3 |
14.1 |
||
EBITDA Margin (%) |
-7.3 |
-7.9 |
-3.8 |
2.4 |
6.1 |
5.0 |
6.3 |
7.2 |
||
Normalised Operating Margin |
-12.3 |
-13.7 |
-4.4 |
2.1 |
5.9 |
3.9 |
5.3 |
6.3 |
||
BALANCE SHEET |
||||||||||
Fixed Assets |
|
|
15.7 |
3.0 |
2.0 |
1.3 |
75.1 |
93.7 |
96.7 |
92.7 |
Intangible Assets |
12.0 |
1.5 |
0.9 |
0.5 |
69.9 |
70.5 |
74.1 |
70.7 |
||
Tangible Assets |
0.6 |
0.5 |
0.3 |
0.2 |
1.4 |
15.7 |
15.1 |
14.5 |
||
Investments & other |
3.1 |
1.1 |
0.7 |
0.6 |
3.8 |
7.5 |
7.5 |
7.5 |
||
Current Assets |
|
|
48.0 |
25.5 |
28.1 |
79.1 |
100.9 |
116.3 |
129.7 |
160.7 |
Stocks |
5.9 |
5.0 |
3.7 |
3.7 |
4.8 |
14.4 |
17.2 |
19.6 |
||
Debtors |
4.8 |
4.7 |
4.3 |
4.9 |
11.6 |
9.9 |
11.8 |
13.5 |
||
Cash & cash equivalents |
30.5 |
11.1 |
17.1 |
65.7 |
75.4 |
82.8 |
91.5 |
118.4 |
||
Other |
6.9 |
4.7 |
2.9 |
4.8 |
9.1 |
9.2 |
9.2 |
9.2 |
||
Current Liabilities |
|
|
(32.0) |
(25.3) |
(28.1) |
(37.2) |
(60.5) |
(74.6) |
(79.7) |
(85.8) |
Creditors |
(26.9) |
(24.5) |
(26.6) |
(35.4) |
(54.8) |
(64.3) |
(69.4) |
(75.5) |
||
Tax and social security |
(0.3) |
(0.0) |
(0.3) |
(1.7) |
(3.0) |
(1.2) |
(1.2) |
(1.2) |
||
Short term borrowings |
(4.8) |
(0.7) |
(1.1) |
(0.1) |
(2.7) |
(6.1) |
(6.1) |
(6.1) |
||
Other |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
(3.0) |
(3.0) |
(3.0) |
||
Long Term Liabilities |
|
|
(2.4) |
(1.1) |
(0.7) |
(29.0) |
(52.0) |
(73.1) |
(73.1) |
(73.1) |
Long term borrowings |
(1.8) |
(0.6) |
0.0 |
(28.1) |
(49.1) |
(62.8) |
(62.8) |
(62.8) |
||
Other long term liabilities |
(0.7) |
(0.5) |
(0.7) |
(0.9) |
(2.9) |
(10.3) |
(10.3) |
(10.3) |
||
Net Assets |
|
|
29.3 |
2.1 |
1.3 |
14.2 |
63.6 |
62.3 |
73.6 |
94.4 |
Minority interests |
0.0 |
0.0 |
(0.1) |
(1.8) |
(11.0) |
(11.7) |
(16.1) |
(21.7) |
||
Shareholders' equity |
|
|
29.3 |
2.1 |
1.2 |
12.5 |
52.6 |
50.6 |
57.5 |
72.7 |
CASH FLOW |
||||||||||
Op Cash Flow before WC and tax |
(6.8) |
(9.2) |
(5.0) |
3.9 |
16.0 |
20.6 |
30.6 |
40.0 |
||
Working capital |
0.4 |
2.5 |
6.8 |
7.9 |
(4.1) |
22.5 |
0.4 |
2.0 |
||
Exceptional & other |
(3.8) |
(4.3) |
(2.2) |
(5.7) |
(5.2) |
(6.3) |
(3.0) |
0.0 |
||
Tax |
0.3 |
(0.3) |
(0.0) |
(1.2) |
(3.8) |
(6.8) |
(3.4) |
(6.2) |
||
Net operating cash flow |
|
|
(9.8) |
(11.3) |
(0.4) |
5.0 |
3.0 |
30.0 |
24.6 |
35.8 |
Capex |
(4.4) |
(0.9) |
(0.2) |
(0.1) |
(2.5) |
(1.2) |
(1.0) |
(1.0) |
||
Acquisitions/disposals |
10.8 |
(0.4) |
3.6 |
14.2 |
(13.3) |
(31.9) |
(7.0) |
0.0 |
||
Net interest |
(0.9) |
(0.1) |
(0.0) |
(0.3) |
0.0 |
(0.5) |
(4.7) |
(4.7) |
||
Equity financing |
33.2 |
(5.1) |
1.9 |
2.0 |
(1.4) |
0.0 |
0.0 |
0.0 |
||
Dividends |
0.0 |
2.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
||
Other |
0.1 |
0.1 |
0.1 |
(0.6) |
0.0 |
0.4 |
(3.2) |
(3.2) |
||
Net Cash Flow |
29.0 |
(15.7) |
5.0 |
20.1 |
(14.2) |
(3.2) |
8.7 |
26.9 |
||
Opening net debt/(cash) |
|
|
18.0 |
(23.9) |
(9.8) |
(16.0) |
(37.5) |
(23.6) |
(13.9) |
(22.6) |
FX |
0.1 |
(0.1) |
(0.6) |
0.4 |
0.3 |
(0.8) |
0.0 |
0.0 |
||
Other non-cash movements |
12.6 |
1.7 |
1.8 |
1.1 |
0.0 |
(5.7) |
0.0 |
0.0 |
||
Closing net debt/(cash) |
|
|
(23.9) |
(9.8) |
(16.0) |
(37.5) |
(23.6) |
(13.9) |
(22.6) |
(49.5) |
Source: Claranova, Edison Investment Research
|
|
Research: Metals & Mining
On 28 October, Lepidico (LPD) announced that it had signed a formal mandate with the US International Development Finance Corporation (DFC) to undertake an in-depth analysis and evaluation of the Karibib Phase 1 (L Max/LOH-Max) project for the purpose of determining whether it qualifies for DFC debt-based financing. This entry of a US federal government institution into the development of Lepidico’s Phase 1 project is consistent with the former’s attempt to secure the future supply of up to 35 metals and minerals deemed ‘critical’ for the ongoing health of the US economy – four of which can be produced by Lepidico. In addition to the credibility that the DFC lends Karibib, for the company, its involvement holds out the possibility of a higher (and more efficient) proportion of debt funding and a lower average interest rate.