Last close As at 05/08/2026
EUR1.37
▲ −0.02 (−1.37%)
Market capitalisation
EUR274m
Research: TMT
Since listing on Scale in July 2020, Media and Games Invest (MGI) has completed a dual listing and share placing on Nasdaq First North and issued a €80m bond. In Q320, it reported 29% l-f-l revenue growth with revenues of €35.0m and adjusted EBITDA of €6.4m, supported by 16% organic growth year to date in the games portfolio. Adjusted EBITDA margins fell from 22% in H120 to 18% in Q320, reflecting a changed business mix (with increased digital media and ad tech revenues). Due to the strong growth, management raised its FY20 guidance, with revised targets of revenue of €125–130m (up from €115–125m) and EBITDA of €23–26m (€20–23m previously). Net debt, adjusted for the SEK300m (c €29m) equity placing, fell to €49.3m, leaving scope for M&A.
Written by
Media and Games Invest |
Equity+bond placings, FY20 guidance raised
Software & computer services |
Scale research report - Flash
1 December 2020 |
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Since listing on Scale in July 2020, Media and Games Invest (MGI) has completed a dual listing and share placing on Nasdaq First North and issued a €80m bond. In Q320, it reported 29% l-f-l revenue growth with revenues of €35.0m and adjusted EBITDA of €6.4m, supported by 16% organic growth year to date in the games portfolio. Adjusted EBITDA margins fell from 22% in H120 to 18% in Q320, reflecting a changed business mix (with increased digital media and ad tech revenues). Due to the strong growth, management raised its FY20 guidance, with revised targets of revenue of €125–130m (up from €115–125m) and EBITDA of €23–26m (€20–23m previously). Net debt, adjusted for the SEK300m (c €29m) equity placing, fell to €49.3m, leaving scope for M&A.
Changing business mix, more M&A to come
Gaming remains the principal driver behind MGI’s year-to-date performance, representing 55% of revenues, but 83% of EBITDA, with an adjusted EBITDA margin of 31%. Despite this, adjusted EBITDA margins fell from 22% in H120 to 18% in Q320, reflecting an increased revenue contribution from lower-margin digital media and ad tech (45% of revenues, 17% of EBITDA, 9% adj EBITDA margin). The €80m bond placing allows management to refinance the €50m gamigo bond, simplifying the finance structure and, with a coupon of Euribor +5.75%, saves €1m per year in interest costs, offering €30m additional headroom for M&A.
FY20 guidance raised once more
In its preliminary Q3 trading update on 5 November, management again raised its guidance for FY20, with the top of the old range now the bottom of the new range for both revenue and EBITDA. Revenue guidance of €125–130m represents growth of 49–55% over FY19 (€83.9m). EBITDA guidance of €23–25m represents growth of 48–68% over FY19 (€15.5m).
Valuation: Attractive, reduced funding costs
Based on the mid-point of management’s guidance for FY20, MGI trades at an EV/sales multiple of 1.4x and an EV/adjusted EBITDA multiple of 9.0x, compared to its closest peer, Stillfront, on 8.1x consensus FY20e revenues and 20.8x consensus FY20e EBITDA. Following €110m of equity and bond financing, MGI has access to €60m of free cash for M&A while saving 2% pa on its bond coupon (annualised €1m+). With predictable revenues and strong cash flow generation (cash conversion of c 80%), MGI’s gearing should fall quickly. Underlying growth remains attractive and, supported by M&A (a full M&A pipeline), there is considerable scope for share price appreciation as investors become more familiar with the equity story and multiples normalise towards peer group averages.
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Consensus estimates
Source: MGI accounts (historical figures), Refinitiv consensus (forecasts). Note: *EBITDA adjusted for one-off M&A and financing costs. |
Edison Investment Research provides qualitative research coverage on companies in the Deutsche Börse Scale segment in accordance with section 36 subsection 3 of the General Terms and Conditions of Deutsche Börse AG for the Regulated Unofficial Market (Freiverkehr) on Frankfurter Wertpapierbörse (as of 1 March 2017). Two to three research reports will be produced per year. Research reports do not contain Edison analyst financial forecasts.
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