The Platform Group — Strong momentum in Q125

The Platform Group (FRA: TPG)

Last close As at 22/05/2025

EUR11.45

−0.05 (−0.43%)

Market capitalisation

EUR235m

More on this equity

Research: Consumer

The Platform Group — Strong momentum in Q125

The Platform Group’s Q125 results show strong momentum with a seasonally high adjusted EBITDA margin. Coming so soon after the recent FY24 results, there is no change to management’s guidance for the year, which looks conservative given the profit contribution already reported in Q125. The valuation continues to look very attractive versus its peers.

Russell Pointon

Written by

Russell Pointon

Director of Content, Consumer and Media

Retail

Spotlight — update

23 May 2025

Price €11.45
Market cap €235m
Price Performance
Share details
Code TPG
Listing FSE

Shares in issue

20.4m

Net cash/(debt) (excluding value of holding in Mister Spex) at 31 December 2024

€(83.6)m

Business description

The Platform Group is a leading European online e-commerce platform company. Its software solutions connect partners in many sectors to new e-commerce customers across numerous online channels. Its services include marketing, customer support, payment and delivery.

Bull points

  • Connects commercial partners that lack scale to access a high number of online stores.
  • Large (c 15,300) and growing number of commercial partners across many industries.
  • Investment requirements beyond M&A are low, in particular software for platform solutions.

Bear points

  • E-commerce markets are competitive.
  • M&A aspirations (five to eight acquisitions per year) present execution risk.
  • Expansion into new business verticals and geographies may bring different operational challenges and financial rewards.

Analysts

Russell Pointon
+44 (0)20 3077 5700
Nick Hawkins
+44 (0)20 3077 5700

The Platform Group is a research client of Edison Investment Research Limited

Strong growth and high margin

Strong growth in the number of active customers (+30%) and average order value (+9%) via more partners (+28%) led to a significant (87–88%) increase in both gross merchandise volume (GMV) and adjusted EBITDA and net profit (+47%), with limited financial and tax charges. The adjusted EBITDA margin of 9.9% was much stronger than the comparative of 7.9% in Q124. There was the typical quarterly variability in TPG’s revenue take (revenue/GMV), but revenue still grew strongly (+49%). From a profit perspective, it was pleasing to see the first reduction in distribution costs relative to sales for two years, according to management. This meant the drop in gross margin of 290bp to 34.8%, due to mix changes from acquisitions, was broadly similar at the reported EBITDA level, which fell by 330bp to 12.2%.

No change to recently updated guidance

Management reiterated its guidance for FY25 and FY26, which was upgraded at the recent FY24 results. The guidance implies a lower adjusted EBITDA margin for the rest of the year than was achieved in Q125, which is consistent with the trends of lower profitability that were seen through FY24. It is worth highlighting that Q125’s adjusted EBITDA of €15.9m is equivalent to roughly one-third of the FY25 guidance, much greater than Q124’s roughly one-quarter contribution to FY24. Therefore, the guidance looks conservative but there is limited visibility on the phasing and annualisation of contributions from M&A between years. The opening of a new fulfilment centre will enable TPG to consolidate its other subscale facilities and provide the potential for cost synergies of over €1m.

Valuation: Attractive versus peers

The strong relative share price performance is leading to a gradual re-rating. However, the prospective EV/EBITDA of 6.6x for FY25 remains at a significant discount versus the median of the non-food online peers of 12.6x, although there is a wide range of multiples for the individual companies.

Source: Company accounts and guidance. Note: Forecasts are the midpoint of management’s guidance.

Historical financials and company guidance

Year end Revenue (€m) EBITDA (€m) PBT (€m) EPS (€) EV/EBITDA (x) P/E (x)
12/23 440.8 22.6 33.0 1.48 14.1 7.7
12/24 524.6 33.2 36.3 1.60 9.6 7.2
12/25e 690.0 48.5 - - 6.6
12/26e 820.0 69.7 - - 4.6

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 sol icitation 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

More on The Platform Group

View All

Latest from the Consumer sector

View All Consumer content

Research: Industrials

Smiths News — New recycling MD underpins new activity potential

Smiths News’ PBT increased by 11% in H125, a combination of higher profits and lower financing costs as both debt and debt margins declined. However, in addition to this and perhaps more exciting is confirmation that Smiths has appointed a managing director for its recycling operations from within the industry, a clear endorsement of the potential in this area. Furthermore, its new activities are already gathering momentum, which is mitigating the structural decline of the news and magazine activity and, we believe, has the potential to result in long-term profit growth. This in turn underpins cash generation and dividends, and could see further distributions. We have maintained our operating profit forecasts and valuation of 93p/share, but reduced our FY25 net debt estimate.

Continue Reading

Subscribe to Edison

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

Sign up for free