Team Internet Group — More diverse, international, integrated

Team Internet Group (AIM: TIG)

Last close As at 18/05/2024

GBP1.66

0.60 (0.36%)

Market capitalisation

GBP430m

More on this equity

Research: TMT

Team Internet Group — More diverse, international, integrated

Team Internet (previously CentralNic) marked its 10-year anniversary of being listed with a name change and a capital markets day. Both reinforced the company’s transformation into a diversified digital marketing platform group. The group consists of a network of people, technologies and tier one partners focused on creating successful connections between consumers and companies online. We believe that this strategy and platform provide a resilient foundation for Team Internet to continue to generate strong growth and cash flows. In our view, the current value rating is at odds with the company’s growth track record and prospects.

Written by

Dan Ridsdale

Head of Technology

CentralNic Group_resized

TMT

Team Internet Group

More diverse, international, integrated

Capital markets day

Software and comp services

19 September 2023

Price

133p

Market cap

£364m

US$1.25/£

Net debt/cash (US$m) at 30 June 2023

68.2

Shares in issue

274m

Free float

46.5%

Code

TIG

Primary exchange

AIM

Secondary exchange

N/A

Share price performance

%

1m

3m

12m

Abs

1.4

15.1

8.1

Rel (local)

(2.3)

14.4

3.2

52-week high/low

159p

109p

Business description

Team Internet Group is a global internet company that derives recurring revenue from privacy-safe, AI-based customer journeys that help online consumers make informed choices, as well as from the distribution of domain names.

Next events

German Equity Forum 2023 (Deutsches Eigenkapitalforum)

November 2023

Analysts

Dan Ridsdale

+44 (0)20 3077 5700

Max Hayes

+44 (0)20 3077 5700

Team Internet Group is a research client of Edison Investment Research Limited

Team Internet (previously CentralNic) marked its 10-year anniversary of being listed with a name change and a capital markets day. Both reinforced the company’s transformation into a diversified digital marketing platform group. The group consists of a network of people, technologies and tier one partners focused on creating successful connections between consumers and companies online. We believe that this strategy and platform provide a resilient foundation for Team Internet to continue to generate strong growth and cash flows. In our view, the current value rating is at odds with the company’s growth track record and prospects.

Year end

Revenue ($m)

EBIRDA*
($m)

PBT*
($m)

Diluted EPS*
(p)

EV/EBITDA
(x)

P/E
(x)

12/21

410.5

46.3

31.9

10.9

11.6

12.2

12/22

728.2

86.0

64.3

21.4

6.2

6.2

12/23e

833.7

94.4

80.7

21.1

5.7

6.3

12/24e

909.6

103.0

89.3

24.7

5.2

5.4

Note: *Excludes the impact of share-based payments, foreign exchange charges and non-core operating costs.

What is in a name?

The renaming of the group Team Internet from CentralNic reflects the extent to which the business has expanded beyond its domain name registry origins to become a diversified digital marketing platform business. Through organic growth and a programme of acquisitions, the company has diversified its presence in both online marketing and online presence (domain registry, etc) business lines. This commercial growth has been mirrored in financial performance, with revenues growing from $4m in 2013 to $728m in 2022 (a 79% CAGR), with EBITDA growing at a CAGR of 65% over the same period. Performance has remained strong in FY23, with revenues and EBITDA growing 18% and 15% year-on-year.

More diverse, more global, more vertically integrated

We believe that Team Internet is well placed to continue on this growth path, supplementing organic growth initiatives with regular acquisitions to further diversify the company’s service, partner and geographical footprint, and support the capture of more value per transaction through vertical integration.

Valuation: Resilience, growth prospects not priced in

Team Internet’s value ratings of 5.7x 2023 EV/EBITDA and 6.3x P/E are in stark contrast with its growth track record and our view of the company’s prospects for continued growth. We believe that the capital markets day illustrated the extent to which the business has both diversified its risk profile and put in place the methodologies and culture to open up new growth opportunities. The business model is cash generative, and the share price does not yet fully factor in the impact of its share buyback programme.

Capital markets day: Key takeaways

‘Transforming how businesses and customers connect online’

Team Internet’s capital markets day marked the company’s 10th year since IPO. While management took the opportunity to highlight the company’s strong track record of generating growth since IPO, the day was mainly focused on explaining how the business has put in place a diverse platform of products and partners, supported by a team and culture to sustain this strong growth trajectory.

Since IPO, Team Internet has built its business through organic growth and regular acquisitions, first building the company’s footprint in the global domain ecosystem and then expanding and building a diverse position in online marketing. The result is a business that has sustained robust organic growth, with a diverse set of offerings and partners within the digital ecosystem. CEO Michael Riedl discussed the group’s common purpose, spanning these operations, of 'Transforming how businesses and customers connect online’. In particular, the company is focused on delivering reciprocal success for itself, customers and partners through delivering well qualified, high-intent traffic to the group’s partner and customer base.

Exhibit 1: Corporate introduction
(click graphic for CMD video)

Exhibit 2: Mission, purpose and vision
(click graphic for CMD video)

Source: Team Internet CMD

Source: Team Internet CMD

Exhibit 1: Corporate introduction
(click graphic for CMD video)

Source: Team Internet CMD

Exhibit 2: Mission, purpose and vision
(click graphic for CMD video)

Source: Team Internet CMD

More diverse, integrated, more global

The company’s growth strategy from here on is set to continue in a similar vein with the goal of building a business that becomes progressively more diverse, more global and more vertically integrated. The company will continue to combine organic development initiatives with M&A to achieve this.

With a strong platform to build upon, organic development initiatives are now coming to the fore. For example, the company highlighted the development of Adsolutely, a supply aggregator as a mechanism for capturing more of the value chain within its Search operations. The company is also applying AI or machine learning across many elements of its business to optimise processes or improve efficiency.

On the M&A side, with Team Internet operating in a fragmented market, we continue to see good opportunities for the company to both broaden and strengthen its offering through acquisitions while maintaining a balanced approach to capital allocation.

Diverse, long-standing, symbiotic partnerships

Most successful businesses within the digital advertising and marketing space leverage partnerships with tier one ecosystem players and Team Internet is no exception. These partners are key to the group’s success and growth strategy, while key partner risk is considerably mitigated by the fact that these relationships are long standing and symbiotic, and the company’s network of partners continues to diversify. For example, the company’s Search division’s relationship with Google spans nearly 10 years, while the company has also added Yahoo and Bing as demand-side platforms, complementing the likes of Facebook, TikTok and Taboola on the supply side. In the Comparison division, Vergleich.org has partnered with Amazon for nine years, but also works with eBay, Otto and many other smaller retailers and with Axel Springer as media partner.

Understanding the company’s four divisions

While Team Internet currently reports two segments – Online Marketing and Online Presence – the capital markets day gave equal weighting to four key business lines: Search, Comparison, Performance (all reported within Online Marketing), as well as Online Presence.

Exhibit 3: Revenue breakdown by division

Source: Team Internet, Edison Investment Research

Search

The company’s Search division includes a number of businesses providing traffic monetisation services for domain owners and traffic commerce solutions for advertisers and publishers. The division’s core value proposition is essentially to connect online consumers to the services they are looking for, generating revenues through delivering high intent traffic to the customer base of publishers, advertisers and domain owners.

This is the largest and most diverse division within Online Marketing, comprising of four brands:

Tonic – a leading traffic monetisation platform, a key growth engine of the business, which has grown traffic by 400% since 2021.

Parking Crew – the leading provider of solutions for monetising type-in traffic for domain traffic globally.

Aporia – a performance-marketing agency and Tonic’s largest publisher.

Traffic Club – an owned and operated domain portfolio acquisition and management business.

Exhibit 4: Parking Crew – domain monetisation
(click graphic for CMD video)

Exhibit 5: Tonic – traffic monetisation
(click graphic for CMD video)

Source: Team Internet

Source: Team Internet

Exhibit 4: Parking Crew – domain monetisation
(click graphic for CMD video)

Source: Team Internet

Exhibit 5: Tonic – traffic monetisation
(click graphic for CMD video)

Source: Team Internet

Management cites the business’s commitment to innovation and value-added product development as a key success factor for operating in a digital traffic market that is complex, fragmented and dynamic. For example, machine learning is being used to optimise templates and key words to improve conversion rates.

The group is also continually expanding and optimising its offering through both organic development and M&A. To illustrate, management highlighted how the group is now able to provide each step in connecting advertisers with publishers through a combination of Parking Crew, Tonic, Aporia (acquired in September 2022) and Adsolutely (developed in house). Management estimates that through offering more integrated solutions, its share of a transaction has the potential to increase from 25% to 45–50%.

Exhibit 6: Capturing more of the value chain through vertical integration

Source: Team Internet

Comparison

The group’s performance division is dominated by Vergleich.org, the leading data-driven B2C product comparison site in Germany, Europe’s largest e-commerce market. This business was acquired in February 2022 for an initial value of €67m (€60m EV) expanding by a potential €38m based on performance.

Vergleich’s key value proposition is to effectively and efficiently convert interested customers into buyers, often within two minutes. The business achieves this through developing, maintaining and promoting multiple specialist comparison websites, each representing specific product categories, for example, household, sports & leisure etc, which offer comparisons for over 20,000 product types covering over 300,000 products. The business operates websites under its own brand, and on a white-label basis for key media partners, the largest one being Axel-Springer (Bild, Auto-Bild, Computer and WELT).

The company then aims to ‘own’ the search results for any consumer considering buying a specific product, through running sites with very relevant content, site and key-word optimisation and paid search, etc.

The company derives the majority of its revenues from transaction fees from key retail partners, the largest of which is Amazon (50% of the German e-commerce market and a partner for nine years), but also eBay, Otto and many other general and specialist firms. The company is also seeing strong growth from fees from manufacturers for hosting sponsored products, with advertisements (Google AdSense) providing a revenue stream for non-converting traffic.

Exhibit 7: Comparison – Vergleich.org (click graphic for CMD video)

Source: Team Internet

Measured international expansion – but potential could be significant

Vergleich is continuing to see good growth prospects in Germany. The German e-commerce market is forecast to grow 8% in 2023, according to Statista, which is supplemented by adding new partners and product categories. The company continues to develop and optimise its technology platform to further improve conversion and the scalability of the model. For example, AI is being used to support the generation of content.

The company has now taken its first steps internationally. A proof of concept has been started in France with a small team and limited set of product categories and partners. Initial work is focused on understanding what works and what does not from a French consumer’s perspective, which would then pave the way for a more concerted expansion. Beyond this, other European markets and eventually the US will also come into focus.

We believe that the growth opportunity for Vergleich could be very substantial. Through leveraging its core platform and key partnerships and adopting an incremental, data led approach, the company should be able to execute this strategy in an incremental, low risk way. We believe that further data points supporting the company’s international growth potential will be an important key performance indicator for investors.

Performance

The Performance division provides technologies and services to help customers track, analyse and optimise their online commercial activities. These services are provided to support both external customers and Team Internet’s own operations.

The division consists of three key brands, Zeropark and Voluum, acquired together in June 2020, and now joined by Adrenalads, acquired in early September 2023.

Exhibit 8: Performance Division – structure

Source: Team Internet

Zeropark is a commerce media platform that helps brands simplify the process of reaching high intent customers. Essentially, the product aims to maximise a customer’s return on their activities and processes in a complex digital environment where consumers have many more touchpoints to brands and spend more time researching buying decisions. The group recently announced a series of new partnerships for Zeropark: 1) it has been upgraded to a Tier 1 Demand Partner by Sovrn, a leading publisher technology platform reaching 500 million active consumers; 2) a significant deal with Booking.com, aimed at increasing vacation bookings through targeted ad campaigns run by Zeropark's media buying team; 3) Klarna, a buy now, pay later platform, has become a direct publisher on the Zeropark network.

Voluum is a SaaS ad tracking platform that allows advertisers to track any type of campaign or advertisement, then analyse and optimise future campaigns. It collects detailed data on clicks and conversions and has automation tools (eg automated AB tests) that enable the client to quickly take action and adapt their processes accordingly.

Adrenalads – this acquisition brought on board a team of very experienced media buyers who focus on direct navigation and search traffic. This acquisition was made to support the scaling of Team Internet’s existing businesses.

Exhibit 9: Zero Park
(click graphic for CMD video)

Exhibit 10: Voluum
(click graphic for CMD video)

Source: Team Internet

Source: Team Internet

Exhibit 9: Zero Park
(click graphic for CMD video)

Source: Team Internet

Exhibit 10: Voluum
(click graphic for CMD video)

Source: Team Internet

Online Presence

Online Presence was where it all started for Team Internet and now comprises a suite of platform and service providers in the global market for internet domains. The company has progressively expanded its range of offerings and market position through M&A since IPO, to the extent that it has become a critical component of the global online presence marketplace.

Growths drivers strengthening

In recent years, the division has been somewhat of a cash cow for the group, but growth is now picking up again, with the division registering 15% growth on a 12-month trailing basis (TTM) 2023 compared to 5% for TTM 2022 at H122. This was attributed to the structural shift in demand towards top level domains where CentralNic has a competitive edge. Looking ahead, growth prospects could be further boosted by the progress the group is making in the government market and by iCann’s plans to begin accepting applications for the next round of top-level domain names in 2026.

Government – the company announced that its Registry business had been selected as one of two suppliers of critical domain services to the UK government’s Crown Commercial Service’s Network Services 3 framework. The company operates and manages the UK government’s .gov.uk and .london domains. Management is seeing good opportunities to expand its services with the UK government and with other government organisations, some of which are looking at the UK government’s structure as a blueprint for their own on-line services.

Proposed new GTLDs expand the envelope – ICANN, the organisation that oversees the global Domain Name System (DNS), is working towards making new generic Top Level Domains (gTLDs) available in 2026, 14 years after the last window, in 2012, which ultimately introduced over 1,200 new gTLDs to the DNS. This should drive demand for the company’s advisory services to 2026 followed by registry and distribution once new domains become available.

Online Presence Services in more detail

Resellers – operating through the brands CentralNic Reseller, Hexonet, Partner Gate and TPP Wholesale, Team Internet is the second largest domain name distribution network globally. The reseller operations provide technology and expertise to enable clients to run their TLDs effectively. For example, it ensures clients maintain compliance with ICANN’s guidelines, as well as providing value-added services such as Hosting and cybersecurity solutions. It is growing year on year.

Brand Services is a consultancy/advisor type business, where expert teams work with domain owners to help them protect and optimise their online presence. While this is a competitive market, it also high margin and the company enjoys long-standing relationships with brand names. Growth opportunities are being seen in the mid-market and emerging economies, while this division should be the first to benefit from ICANN’s new gTLD release in 2026.

Registry – the role of the domain registry is help TLD owners and managers to manage and maintain those TLDs. One of a small number of competitors and regulated by iCANN, the registry business provides the software, infrastructure and expertise to make sure customers’ domains remain online. The company’s progress with the UK government and ICANN’s proposed expansion of top level gTLD provide two clear growth opportunities for this business.

Retail – the company owns a portfolio of retail stores offering domains, email, website builders and security products to consumers, sole traders, SMBs and domain investors. The company is investing in technology to enhance sales performance, adding higher-margin, value-added services and is in the process of merging platforms and brands to simplify operations and enhance productivity.

Exhibit 11: Reseller
(click graphic for CMD video)

Exhibit 12: Registry
(click graphic for CMD video)

Source: Team Internet

Source: Team Internet

Exhibit 13: Brand Services
(click graphic for CMD video)

Exhibit 14: Retail
(click graphic for CMD video)

Source: Team Internet

Source: Team Internet

Exhibit 11: Reseller
(click graphic for CMD video)

Source: Team Internet

Exhibit 13: Brand Services
(click graphic for CMD video)

Source: Team Internet

Exhibit 12: Registry
(click graphic for CMD video)

Source: Team Internet

Exhibit 14: Retail
(click graphic for CMD video)

Source: Team Internet

Valuation: Track record, diversity and growth prospects not reflected in the current valuation

Team Internet’s value ratings of 5.5x 2023 EV/EBITDA and 6.3x P/E are in stark contrast with its growth track record and our view of the company’s resilience and prospects for continued growth. The ratings are at substantial discounts to peers: 32% based on EV/EBITDA and 52% based on P/E. The company has also developed a good track record of meeting or beating estimates (eg our FY23 adjusted EPS estimate is now 22% higher than when initiated in March 2022) and we see no reason why this track record is about to be interrupted.

We believe that the capital markets day illustrated the extent to which the business has both diversified its risk profile and put in place the methodologies and culture to open up new growth opportunities. The business model is cash generative and the share price does not yet fully factor in the impact of its share buyback programme.

Exhibit 15: Peer valuation table

Ticker

Company 

Year end

 

Share price

 

Quoted
ccy

 

EV
(US$m)

 

Sales
growth

EBITDA/Net Revenue

EV/sales

EV/EBITDA

P/E

FY1e (%)

FY1e
(%)

FY1e (x)

FY2e (x)

FY1e (x)

FY2e (x)

FY1e (x)

FY2e (x)

TIG.L

Team Internet Group

Dec-22

132.8

GBp

534

14.5

49.5

0.6

0.6

5.7

5.2

8.0

6.8

Online Marketing peers

 

 

 

 

 

 

 

 

 

 

 

 

APP.O

Applovin Corp

Dec-23

42.4

USD

16,987

9.5

60.4

5.5

4.9

12.8

10.8

56.6

32.5

SAXG.DE

Stroeer SE & Co

Dec-23

43.8

EUR

3,846

6.5

71.1

1.9

1.7

6.3

5.7

15.3

12.2

MGNI.OQ

Magnite

Dec-23

8.1

USD

1,505

6.7

88.7

2.8

2.5

8.9

7.4

15.9

10.8

PERI.OQ

Perion Network

Dec-23

34.2

USD

1,178

17.0

44.4

1.6

1.4

7.0

6.5

14.3

12.5

TBLA.OQ

Taboola.com

Dec-23

3.7

USD

1,071

4.0

18.0

0.7

0.6

14.0

5.7

184.0

13.0

PUBM.O

PubMatic

Dec-23

13.1

USD

503

(2.2)

40.1

2.0

1.8

8.1

6.4

N/A

74.8

M8G.DE

Mgi Media and Games Invest

Dec-23

1.2

EUR

445

4.4

57.1

1.3

1.2

4.4

3.9

7.7

6.1

TRMR.L

Tremor International

Dec-23

146.0

GBp

171

13.1

33.2

0.5

0.5

1.7

1.5

5.8

3.9

ADTH.OQ

AdTheorent Holding Company

Dec-23

1.3

USD

39

3.9

18.5

0.2

0.2

2.0

1.7

13.1

22.5

DSP.O

Viant Technology

Dec-23

6.4

USD

190

12.9

16.7

0.9

0.8

8.0

6.3

N/A

N/A

SYS1.L

System1

Mar-24

215.0

GBp

29

(11.1)

N/A

1.1

0.9

13.2

8.2

247.9

37.2

YOCG.DE

YOC

Dec-23

12.7

EUR

46

30.0

29.4

1.4

1.2

10.4

8.2

16.0

11.3

Mean

 

 

 

 

7.9

43.4

1.6

1.5

8.1

6.0

57.7

21.5

Median

 

 

 

 

6.6

40.1

1.3

1.2

8.1

6.4

15.6

12.5

Discount to median (Online Marketing)

 

 

 

 

 

 

-52%

-50%

-30%

-18%

-49%

-45%

Online Presence (web services) peers 

 

 

 

 

 

 

 

 

 

 

 

GDDY.N

GoDaddy

Dec-23

73.7

USD

13,900

4.1

40.8

3.3

3.0

12.7

11.4

30.4

21.1

CRTO.OQ

Criteo

Dec-23

29.0

USD

1,243

10.4

32.6

1.2

1.1

4.3

3.9

10.2

9.3

CATME.ST

Catena Media

Dec-23

19.2

SEK

192

N/A

N/A

N/A

N/A

N/A

N/A

N/A

N/A

TCX.N

Tucows

Dec-23

20.1

USD

223

N/A

N/A

N/A

N/A

N/A

N/A

N/A

N/A

IOMG.L

iomart group

Mar-24

180.0

GBp

300

3.5

55.7

2.1

1.8

6.7

6.2

17.3

17.0

Mean

 

 

 

 

6.0

43.0

2.2

2.0

7.9

7.2

19.3

15.8

Median

 

 

 

 

4.1

40.8

2.1

1.8

6.7

6.2

17.3

17.0

Total mean

 

 

 

 

7.5

43.3

1.8

1.6

8.0

6.3

48.8

20.3

Discount to median (Online Presence)

-70%

-68%

-15%

-17%

-54%

-60%

Total median

 

 

 

 

6.5

40.4

1.4

1.2

8.0

6.3

15.9

12.7

Discount to median

-55%

-50%

-30%

-18%

-50%

-47%

Source: Refinitiv, Edison Estimates

Exhibit 16: Financial summary

$'k

2020

2021

2022

2023e

2024e

31-December

IFRS

IFRS

IFRS

IFRS

IFRS

INCOME STATEMENT

Revenue

 

 

240,012

410,540

728,237

833,705

909,572

Cost of Sales

(164,894)

(292,041)

(550,541)

(643,120)

(701,456)

Gross Profit

75,118

118,499

177,696

190,585

208,116

EBITDA

 

 

29,394

46,251

86,024

94,416

103,017

Normalised operating profit

 

 

27,310

42,737

83,045

90,839

99,115

Amortisation of acquired intangibles

(13,747)

(18,291)

(36,399)

(36,399)

(36,399)

Exceptionals

(10,529)

(7,087)

(7,395)

0

0

Share-based payments

(5,113)

(5,006)

(5,698)

(5,698)

(5,698)

Reported operating profit

(2,079)

12,353

33,553

48,742

57,018

Net Interest

(9,834)

(10,798)

(18,736)

(10,120)

(9,813)

Joint ventures & associates (post tax)

79

0

0

0

0

Exceptionals

0

0

0

0

0

Profit Before Tax (norm)

 

 

17,555

31,939

64,309

80,720

89,302

Profit Before Tax (reported)

 

 

(11,834)

1,555

14,817

38,623

47,205

Reported tax

975

(5,097)

(16,895)

(25,023)

(27,684)

Profit After Tax (norm)

14,044

25,551

57,414

58,118

64,297

Profit After Tax (reported)

(10,859)

(3,542)

(2,078)

13,599

19,521

Net income (normalised)

14,044

25,551

57,414

58,118

64,297

Net income (reported)

(10,859)

(3,542)

(2,078)

13,599

19,521

Basic average number of shares outstanding (m)

197

227

266

273

257

EPS - basic normalised (c)

 

 

7.14

11.24

21.61

21.29

25.00

EPS - diluted normalised (c)

 

 

6.86

10.91

21.41

21.09

24.75

EPS - basic reported (c)

 

 

(5.52)

(1.56)

(0.78)

4.98

7.59

Dividend (c)

0.00

0.00

0.01

0.01

0.01

Revenue growth (%)

119.8

71.0

77.4

14.5

9.1

Gross Margin (%)

31.3

28.9

24.4

22.9

22.9

EBITDA Margin (%)

12.2

11.3

11.8

11.3

11.3

EBITDA/Net Revenue (%)

39.1

39.0

48.4

49.5

49.5

Normalised Operating Margin

11.4

10.4

11.4

10.9

10.9

BALANCE SHEET

Fixed Assets

 

 

270,578

271,830

365,062

351,263

328,864

Intangible Assets

255,716

254,169

347,938

334,139

311,740

Tangible Assets

8,677

8,601

7,358

7,358

7,358

Investments & other

6,185

9,060

9,766

9,766

9,766

Current Assets

 

 

77,606

128,391

193,650

206,090

255,537

Stocks

1,011

895

646

1,938

2,114

Debtors

47,941

71,363

98,231

111,922

112,139

Cash & cash equivalents

28,654

56,133

94,773

92,230

141,284

Other

0

0

0

0

0

Current Liabilities

 

 

96,421

137,129

197,712

216,865

219,479

Creditors

89,256

117,016

190,348

209,631

212,245

Tax and social security

0

0

0

0

0

Short term borrowings

5,819

18,276

5,456

5,326

5,326

Lease liabilities

1,346

1,837

1,908

1,908

1,908

Long Term Liabilities

 

 

137,867

149,110

193,667

205,172

207,851

Long term borrowings

107,820

119,251

145,872

145,872

145,872

Other long-term liabilities

30,047

29,859

47,795

59,300

61,979

Net Assets

 

 

113,896

113,982

167,333

135,316

157,071

Minority interests

0

0

0

0

0

Shareholders' equity

 

 

113,896

113,982

167,333

135,316

157,071

CASH FLOW

Op Cash Flow before WC and tax

3,997

23,360

54,195

78,598

87,506

Working capital

4,129

4,091

7,245

4,299

2,222

Exceptional & other

14,526

15,804

24,434

15,818

15,511

Tax

(1,957)

(2,230)

(8,399)

(13,518)

(25,005)

Net operating cash flow

 

 

20,695

41,025

77,475

85,197

80,235

Capex

(4,259)

(4,810)

(6,543)

(5,667)

(5,819)

Acquisitions/disposals

(37,065)

(18,344)

(81,396)

(18,600)

(10,000)

Interest paid

(9,512)

(8,695)

(7,766)

(10,120)

(9,813)

Equity financing

34,667

0

58,187

(47,460)

0

Change in borrowing

1,563

24,721

34,691

0

0

Other

(4,734)

(3,700)

(30,730)

(2,241)

(2,083)

Net Cash Flow

1,355

30,197

43,918

(2,543)

49,054

Opening net debt/(cash)

 

 

74,998

84,985

81,394

56,555

58,968

FX

1,117

(2,718)

(5,278)

0

0

Other non-cash movements

(12,459)

(23,888)

(13,801)

130

0

Closing net debt/(cash)

 

 

84,985

81,394

56,555

58,968

9,914

Source: Edison Investment Research, company accounts


General disclaimer and copyright

This report has been commissioned by Team Internet Group and prepared and issued by Edison, in consideration of a fee payable by Team Internet Group. 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).

Australia

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 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 distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

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.

United States

Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

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

General disclaimer and copyright

This report has been commissioned by Team Internet Group and prepared and issued by Edison, in consideration of a fee payable by Team Internet Group. 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).

Australia

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 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 distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

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.

United States

Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

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

More on Team Internet Group

View All

Latest from the TMT sector

View All TMT content

Research: Financials

AGBA — Forecasts lowered but momentum maintained

AGBA generated sales of US$28.4m in H123, 361% higher than in H122, as it continued to onboard agents and COVID-19 restrictions were relaxed. Compared to Q123, revenue increased by 54% as AGBA continued to benefit from the reopening of the Hong Kong-China border in February and the Chinese economy. Despite the positive momentum, AGBA has reduced its forecasts for each consecutive year to 2026 because of the slower-than-expected revival of the Chinese and Hong Kong economies so far in 2023. It still projects double-digit growth in subsequent years and expects to capitalise on increasing travel to Hong Kong from Mainland Chinese looking for high-quality health and wealth products.

Continue Reading
AGBA Holding

Subscribe to Edison

Get access to the very latest content matched to your personal investment style.

Sign up for free