Seraphim Space Investment Trust — Long-term structural growth drivers remain intact

Seraphim Space Investment Trust (LSE: SSIT)

Last close As at 11/04/2024

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Seraphim Space Investment Trust — Long-term structural growth drivers remain intact

Seraphim Space Investment Trust (SSIT) posted a 7.2% NAV TR decline in H123 (ended December 2022) following a valuation update that led to an enterprise value (EV) reduction in the case of four of its large private holdings by 25% or more. This led to a 15% EV decrease across SSIT’s top nine private holdings, though only a 3% fall in fair values, which were cushioned by liquidation preferences and anti-dilution protections within SSIT’s investments. Further negative impact came from lower share prices of listed holdings (Arqit most notably). That said, revenue across SSIT’s top nine private holdings held up well with 56% growth h-o-h in H123.

Milosz Papst

Written by

Milosz Papst

Director, Financials

Investment Companies

Seraphim Space Investment Trust

Long-term structural growth drivers remain intact

Investment trusts
Growth capital

27 April 2023

Price Ord

36.7p

Market cap

£87.9m

NAV

£220.0m

NAV per share*

0.93p

Share discount to NAV

60.4%

*As at end-2022.

Yield

0.0%

Shares in issue

239.4m

Code Ord/ISIN

SSIT/GB00BKPG0138

Primary exchange

LSE

AIC sector

Capital Growth

SSIT’s financial year end

30 June

52-week high/low

99.3p

35.6p

105.0p

95.6p

Gearing

Cash at end-2022

£40.9m

Fund objective

Seraphim Space Investment Trust’s objective is to generate capital growth over the long term through investment in a diversified, international portfolio of predominantly early- and growth-stage unquoted space tech businesses with the potential to dominate globally. Space tech businesses rely on space-based connectivity or precision, navigation and timing signals, addressing a broad range of key applications.

Bull points

SSIT should benefit from structural long-term tailwinds.

Downside protection from liquidity preference and anti-dilution clauses.

Most of the top 10 holdings funded through to at least end-2023.

Bear points

Macroeconomic headwinds curbing venture capital deal activity and valuations.

Liquidity constraints could hamper new investments.

Early-stage companies that are yet to break- even are inherently risky.

Analysts

Milosz Papst

+44 (0)20 3077 5700

Andy Chambers

+44 (0)20 3077 5700

Seraphim Space Investment Trust is a research client of Edison Investment Research Limited

Seraphim Space Investment Trust (SSIT) posted a 7.2% NAV TR decline in H123 (ended December 2022) following a valuation update that led to an enterprise value (EV) reduction in the case of four of its large private holdings by 25% or more. This led to a 15% EV decrease across SSIT’s top nine private holdings, though only a 3% fall in fair values, which were cushioned by liquidation preferences and anti-dilution protections within SSIT’s investments. Further negative impact came from lower share prices of listed holdings (Arqit most notably). That said, revenue across SSIT’s top nine private holdings held up well with 56% growth h-o-h in H123.

SSIT’s portfolio exposures as percentage of fair value

Source: Company data. Note: Platforms – constellations of satellites in space; Downlink – data from space to Earth in a cyber-secure manner; Analyse – artificial intelligence applied to large datasets from space; Product – space datasets fused with terrestrial data targeted at a vertical such as construction, agriculture, oil and gas; Beyond Earth – activity in space; Build – satellite construction/manufacturing/components; Launch – rockets.

Why consider SSIT now?

SSIT offers a unique opportunity to access tomorrow’s potential space tech winners in what will surely be a multi-generational secular growth trend. The latter may help offset headwinds from higher interest rates and slowing economic activity. SSIT’s fund manager, Seraphim Space, is a prominent player in the sector and has a demonstrable track record of investing in early-stage companies. SSIT’s portfolio of 29 investments (with the top 10 making up 84% of fair value) represents exposure to a diverse range of space tech themes, covering operators of satellite constellations, data platforms and providers of in-space services, among others.

Analyst’s view

SSIT’s current share price likely reflects investors’ anxiety over the pressure on valuations and cash runways of VC-backed companies. That said, it implies a c 74% discount to the end-2022 fair value of its private portfolio (assuming SSIT’s liquid reserves at face value), which provides a sizeable degree of downside protection (together with the liquidation preferences and anti-dilution protections). We acknowledge that the above analysis does not account for the potential need to consume part of SSIT’s holding-level cash balance (£40.9m at end-2022, or 18.4% of NAV) to support its portfolio companies. The manager highlighted that all of SSIT’s material holdings (top 10) recently raised funding and have sufficient runway through to at least end-2023, except for one holding for which negotiations on follow-on funding are at an advanced stage (with a term sheet agreed).

EVs of top private portfolio down by c 15% following recent recalibration process

SSIT’s NAV per share (NAVPS) declined by 7.2% to £0.93 during the six months to end-2022, bringing its last 12-month NAV total return (TR) to -11.4%. The H123 NAVPS decrease came from £17.3m in fair value losses (of which £2.0m is realised), partly offset by £2.3m in unrealised foreign exchange (FX) gains (see Exhibit 1). Since its initial public offering in July 2021 (when NAVPS was £0.98 after floating costs), SSIT’s NAV is down 5.1%.

Exhibit 1: SSIT’s NAVPS bridge in H123

Source: Company data

Offering diverse exposure to various parts of space economy

SSIT’s portfolio at end-2022 consisted of 29 space tech investments valued at £181.2m, with private companies accounting for 94% (see Exhibit 3). While quite concentrated (top 10 holdings accounted for 84% of the investment portfolio’s fair value), the portfolio is diversified in terms of ecosystem and investment stage (measured by last funding round) (see front page exhibit and Exhibit 2 below). More than half of the end-2022 portfolio constitutes companies with their own satellite constellations in space.

Exhibit 2: Portfolio fair value by last funding round

Source: Company data

Exhibit 3: Summary of SSIT’s portfolio at end-2022

Company name

Subsector

Fair value (end-June 2022, £m)

Additions/

Disposals (£m)

Fair value change (£m)

FX impact (£m)

Fair value (end-2022, £m)

% of NAV

MOIC*

ICEYE

Earth observation

43.3

0.0

0.0

0.2

43.4

19.5%

1.10

ALL.SPACE

Ground terminals

24.9

0.0

(2.7)

0.1

22.3

10.0%

1.15

HawkEye 360

Earth observation

20.6

0.0

0.0

0.1

20.7

9.3%

1.11

D-Orbit

In-orbit services

12.7

4.4

0.6

0.5

18.1

8.2%

1.55

Altitude Angel

Data platforms

9.0

0.0

0.8

0.0

9.9

4.5%

2.66

LeoLabs

Data platforms

13.7

0.0

(4.8)

0.4

9.3

4.2%

0.80

Satellite Vu

Earth observation

7.8

0.0

0.0

0.0

7.8

3.5%

1.68

Astroscale

In-orbit services

7.7

0.0

0.0

0.0

7.7

3.5%

0.82

Arqit

Satcoms

14.0

(4.7)

(3.2)

0.5

6.7

3.0%

0.29

PlanetWatchers

Data analytics

8.1

2.5

(4.9)

0.2

6.0

2.7%

1.08

Top 10

-

161.8

2.2

(14.2)

2.0

151.9

68.4%

1.03

Other non-early stage

-

21.5

9.7%

0.66

Other early stage

-

7.8

3.5%

1.11

TOTAL

-

181.2

81.6%

0.97

Cash

-

40.9

18.4%

-

Performance fee provision

-

0.0

0.0%

-

net current assets/(liabilities)

-

(0.1)

0.0%

-

NAV

-

222.0

100.0%

-

Source: Company data. Note: MOIC – multiple of invested capital defined as the remaining unrealised fair value divided by the revised cost of investment after accounting for partial realisations.

Fair values of major private holdings down only 3% due to investment structuring through preference shares

Amid the volatility in equity valuations in 2022 (including significant de-ratings of several space tech companies that had completed SPAC mergers), SSIT’s board initiated a valuation recalibration process for material portfolio companies which 1) completed the last funding round more than 12 months ago, 2) recently reached significant operating milestones or 3) exhibited considerable under- or overperformance versus their annual plans. This process will be repeated every quarter until the above private companies complete a new funding round. As a result, the EV of four investments from the top nine private holdings (ie all top 10 positions except for the listed Arqit, see Exhibit 3) was reduced by 25% or more, while EVs remained unchanged for three holdings and were slightly raised for two holdings. Consequently, the aggregate EV of SSIT’s top nine private holdings went down by c 15% in H123.

However, the reduction in the corresponding fair value was only 3% thanks to the downside protections structured within SSIT’s investments. These include, in particular, the structuring of investments as preference shares (rather than common equity), which provides a liquidation preference, as well as clauses that provide anti-dilution protection in case of subsequent down rounds (see our previous note for details). Investments in all the top nine private companies in the current portfolio are structured via preference shares with weighted average anti-dilution protection and/or liquidation preference.

Total portfolio valued at 0.97x cost, with top nine private holdings at 1.14x at end-2022

The EV recalibration resulted in reduced fair values of PlanetWatchers (3.3% of end-2022 investment portfolio fair value) and LeoLabs (5.1%), which were therefore valued at 1.08x and 0.80x cost, respectively, at end-2022. This compares to 2.70x and 1.17x at end-June 2022, respectively, though we note that the decline in the PlanetWatchers multiple also resulted from a follow-on investment (see below). Furthermore, the fair value of ALL.SPACE (12.3% of end-2022 investment portfolio fair value) was reduced by £2.7m to £22.3m based on a funding round that is in progress (the company is now valued at 1.15x cost vs 1.28x at end-June 2022).

Arqit’s share price fell between end-June 2022 and end-December 2022 by 43% in US dollar terms. Apart from factors affecting the broader market for venture capital (VC)/growth capital investments (ie reduced investors’ risk appetite in response to macroeconomic uncertainty), there were some stock-specific factors that could have weighed on the share price, such as Arqit’s US$20m capital raise at US$2.00 per share or the bankruptcy filing of Virgin Orbit (which was one of Arqit’s main clients highlighted in SSIT’s trading update from 27 July 2022). Overall, listed holdings (floated through SPAC mergers) saw a 30% decline in their share prices in H123. At end-2022, all of SSIT’s listed holdings made up 5% of NAV (of which 3% was attributable to Arqit) and were held at 0.29x initial cost. The recent fair value reductions brought SSIT’s total portfolio valuation to 0.97x cost (its portfolio was acquired over 202122), though the multiple stood at 1.14x for SSIT’s nine private holdings included in the top 10 investments by fair value.

Current share price implies a c 74% discount to end-2022 fair value of SSIT’s private portfolio

The fall in SSIT’s share price was more pronounced than that of its NAV per share resulting in a widening discount to NAV, which has also been a trend lately across the UK-listed VC and growth capital investment companies we consider peers for SSIT (see Exhibit 4). The discount to end-2022 NAV now stands at c 60%, offering a meaningful degree of downside protection. This is wider than the average 32% discount for venture portfolios sold by limited partners in the global secondary market in 2022 (according to Jefferies Global Secondary Market Review), though we acknowledge that the discounts may have been wider towards the end of 2022 compared to the annual average.

Exhibit 4: Discount to NAV over the last 12 months – SSIT vs peers

Exhibit 5: Share price performance – SSIT vs selected indices and peers

Source: Refinitiv, company data. Note: Peers include Molten Ventures, IP Group, Augmentum Fintech, Chrysalis Investments, Schroder British Opportunities, Schroder UK Public Private Trust.

Source: Refinitiv. Note: Peers include Molten Ventures, IP Group, Augmentum Fintech, Chrysalis Investments, Schroder British Opportunities, Schroder UK Public Private Trust.

Exhibit 4: Discount to NAV over the last 12 months – SSIT vs peers

Source: Refinitiv, company data. Note: Peers include Molten Ventures, IP Group, Augmentum Fintech, Chrysalis Investments, Schroder British Opportunities, Schroder UK Public Private Trust.

Exhibit 5: Share price performance – SSIT vs selected indices and peers

Source: Refinitiv. Note: Peers include Molten Ventures, IP Group, Augmentum Fintech, Chrysalis Investments, Schroder British Opportunities, Schroder UK Public Private Trust.

In this context, we note SSIT’s analysis indicates that a 50% reduction in the fair value of its nine private investments included in the top 10 holdings would reduce its NAV per share by c 19% (still more than double the current share price). This is not a degree of downward revaluation SSIT’s investment manager would expect for its portfolio though. Interestingly, post reporting date (in February 2023), Astroscale (4.2% of end-2022 investment portfolio fair value) raised US$76m in a series G round at a valuation in line with its last funding round in 2022, which (at end-2022 FX rates) implies a £2.6m (or c 34%) uplift to the end-2022 fair value of SSIT’s stake.

We calculate that SSIT’s current market cap (assuming SSIT’s liquid reserves at face value and Arqit’s value at the current share price), implies a c 74% discount to its end-2022 private portfolio fair value (and a c 69% discount to the end-2022 value of its top nine private holdings). This seems wide given major portfolio holdings are well funded at present and are dynamically growing revenues.

Focus on cash preservation

We acknowledge that the above calculations of implied discount to private portfolio may not account for the potential need to consume part of SSIT’s holding-level cash balance to support its portfolio holdings. Amid the more challenging environment across the global VC sector (especially in terms of exits), SSIT has curbed its capital deployment to focus on extending the cash runway of its portfolio companies and preserve cash at the holding level to improve its ability to support key existing portfolio holdings. It made four new investments (amounting to £4.4m) and six follow-ons (£9.0m) in H123 compared to £87.1m in investments in FY22. New investments in H123 included:

Voyager (£2.1m in series B round in July 2022) – a company developing Starlab (in partnership with Airbus Defence and Space), a free flying space station providing facilities to host public and private astronauts and forming critical infrastructure for support, R&D and manufacturing in space. It will serve, among others, NASA (which has provided US$160m in funding) and a global customer base of space agencies.

Taranis (£2.1m in series D round in August 2022) – an agriculture-focused artificial intelligence business that uses Earth observation data (satellite and drone imagery) to optimise crop yields and increase global food supply.

£0.3m invested in two new early-stage companies, sourced through accelerator programmes managed by an affiliate of SSIT’s investment manager.

SSIT also invested £7.1m within its main portfolio (mostly in D-Orbit and PlanetWatchers) and £1.9m into three early-stage companies. Meanwhile, the company collected £3.3m disposal proceeds following the partial sale of its stake in NASDAQ-listed Arqit during the November 2022 price rally at an average price of US$8.48 per share. SSIT still held a stake in Arqit valued at £6.7m at end-2022, currently worth c £2.0m (significantly down from the £47.9m exposure at end-2021).

As a result, SSIT’s holding-level liquid resources reached £40.9m at end-2022 (18.4% of NAV), which according to SSIT’s management represents sufficient support for at least the next 12 months. Overall, 11 of SSIT’s portfolio companies raised more than US$130m between end-June 2022 and end-December 2022. The manager considers all of SSIT’s material holdings (top 10) as well capitalised, with sufficient runway through to at least end-2023, except for one holding for which negotiations on follow-on funding are at an advanced stage (with a term sheet agreed). We note that some of SSIT’s top 10 holdings (eg Astroscale and Arqit) have already raised capital in 2023.

Top private holdings growing top line by 56% sequentially

The operational developments across the global space tech sector are assisted by structural growth drivers, including the increased emphasis on global security and climate/sustainability. In terms of security, the war in Ukraine had a particularly significant impact on the industry, encouraging governments to boost investments in the sector. Most of the revenues generated by SSIT’s portfolio companies come from defence/security, humanitarian efforts, food security and the climate area. Regulation also plays an important role, eg the recent reduction in the time satellite operators have to remove their end-of-life satellites from the orbit was reduced from 25 years to five years. This should benefit in-space service providers such as LeoLabs, D-Orbit or Astrascale. The investment manager also notes that revenues generated from government contracts or grants are a significant driver for many of SSIT’s portfolio companies. These provide a source of stable funding, cushioning the impact from reduced demand from the commercial sector during a more challenging macroeconomic environment. Consequently, SSIT’s private companies from the top 10 list grew revenues by 56% h-o-h in H123 (fair value weighted).

Below we list selected major developments across SSIT’s top four holdings (making up c 47% of its end-2022 NAV):

ICEYE announced in September 2022 that it has partnered with BAE Systems to provide its advanced Synthetic Aperture Radar (SAR) technology as part of BAE Systems’ new multi-sensor satellite cluster launching in 2024 (BAE Systems was onboarded as a new strategic investor of ICEYE during its US$136m series D round in February 2022). It also signed a multi-year framework contract with the European Maritime Safety Agency (in December 2022) and its subsidiary announced a five-year blanket purchase agreement with NASA for the purchase of SAR data (in April 2023). Finally, its real-time flood data is now available via Esri ArcGIS software, a comprehensive system for mapping and location intelligence deployed in over 350,000 organisations globally.

ALL.SPACE announced in March 2023 the delivery of its first smart terminal to SES for testing over its medium earth orbit systems, which the company considers one of the final steps before it officially launches its smart terminal to the defence and commercial market.

HawkEye 360 successfully launched its Cluster 7 satellites in April 2023 aboard the SpaceX Falcon 9 rocket, further expanding the company’s capabilities to 21 satellites. Its sixth satellite cluster started operations in March 2023, after being launched in January 2023. It was also awarded a contract to provide data for Slingshot Aerospace’s space-based monitoring and detection of radio frequency threats and support the latter’s proliferated Low Earth Orbit Data Exploitation and Enhanced Processing programme for the US Space Force’s Space Systems Command. Moreover, it was awarded a radio frequency contract by the National Reconnaissance Office (in September 2022) and signed a cooperative R&D agreement with the US Army (in August 2022).

D-Orbit successfully launched the 10th commercial mission of its proprietary orbital transfer vehicle (‘space taxi’), extending its market leadership. In April 2023 it also signed a €26m contract with the European Space Agency for the IRIDE project to provide one SAR satellite and manage its flight operations segment on behalf of the end-user (with the option for an additional SAR satellite for €24m). Furthermore, the company successfully demonstrated in-orbit cloud computing and storage with Amazon WorkSpaces in November 2022. We note that D-Orbit had to cancel its SPAC merger plans in 2022 amid a deteriorating market environment.

Global private space tech investments recover in Q123 from 2022 lows

We note the continued meaningful VC/growth capital investments in space tech companies, as illustrated by the Seraphim Space Index (see Exhibit 6), with the Q123 investments of US$1.4bn representing a 75% increase from US$0.8bn in Q422. While the recent activity was below the peak levels in 2021 and early 2022, Seraphim Space highlighted that these record-high levels were driven by megarounds from companies such as SpaceX, OneWeb, Sierra Space and Virgin Galactic. Q123 also saw a record number of growth stage deals (32 closed during the quarter). The quarter also marked the first time European investors committed more capital than US investors.

We do acknowledge the overall tougher funding conditions for VC/growth capital companies at present (compared to 2021), especially for businesses with high upfront capital requirements and long lead times to revenues. That said, the above-mentioned strong secular trends within should encourage investors to participate in new funding rounds of high-quality space tech companies.

Exhibit 6: VC/growth capital investments in the global space tech sector (US$bn)

Source: Company data

General disclaimer and copyright

This report has been commissioned by Seraphim Space Investment Trust and prepared and issued by Edison, in consideration of a fee payable by Seraphim Space Investment Trust. Edison Investment Research standard fees are £60,000 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.

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General disclaimer and copyright

This report has been commissioned by Seraphim Space Investment Trust and prepared and issued by Edison, in consideration of a fee payable by Seraphim Space Investment Trust. Edison Investment Research standard fees are £60,000 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 2023 Edison Investment Research Limited (Edison).

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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 been approved and issued for the purposes of section 21 of the Financial Services and Markets Act 2000 (“FSMA”) by Edison Investment Research Limited. 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 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.

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London │ New York │ Frankfurt

20 Red Lion Street

London, WC1R 4PS

United Kingdom

London │ New York │ Frankfurt

20 Red Lion Street

London, WC1R 4PS

United Kingdom

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Research: TMT

CentralNic Group — FY23 outlook maintained after record Q1

CentralNic’s Q123 trading update confirms management is delivering on its strategy of robust organic growth, coupled with strong cash generation, which has improved shareholder returns and further deleveraged its balance sheet. The group is confident that it is trading at least in line with current market consensus for FY23 and we maintain our forecasts, which are slightly ahead of consensus. CentralNic’s latest agreement with Microsoft Bing in Online Marketing lowers the group’s execution risk by diversifying its advertiser demand pool and adds to its growth potential.

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