Original-Research: Media and Games Invest SE - von GBC AG

Einstufung von GBC AG zu Media and Games Invest SE

Unternehmen: Media and Games Invest SE

ISIN: MT0000580101

Anlass der Studie: Research Note

Empfehlung: BUY

Kursziel: 9.20 EUR

Letzte Ratingänderung:

Analyst: Marcel Goldmann, Cosmin Filker

FY 2021 closed with jump in revenues and earnings; Strong dovetailing of

media and games business ensure high growth rate; Due to transformation

into a fully integrated ad tech company with own gaming activities, we

expect dynamic growth; Forecasts and price target raised; Buy rating

Turnover and earnings development 2021

On 28 February 2022, Media and Games Invest SE (MGI) announced its

preliminary business figures for the past financial year 2021. According to

these figures, the MGI Group was able to continue its dynamic growth course

in the past financial period with a jump in turnover of 80.0% to EUR 252.20

million (previous year: EUR 140.20 million). The high growth rate was

particularly due to the strong fourth quarter (revenue Q4 2021: EUR 80.2

million vs. revenue Q4 2020: EUR 48.70 million), which was also the quarter

with the highest revenue and earnings in the company's history to date. The

rapid increase in revenue was based on both organic and inorganic revenue

effects (38.0% organic growth and 42.0% inorganic growth).

The significant increase in Group turnover was mainly driven by the Media

segment. In this business segment, the company achieved a jump in turnover

by 147.7% to EUR 139.60 million (previous year: EUR 65.0 million). In

addition to significant revenue growth from organic growth factors, such as

expanded advertising partnerships, this business unit also benefited from

significant positive effects from completed M&A measures (e.g. Smaato


In addition, the gaming segment also made a significant contribution to the

increase in group revenues with a significant increase in revenues of 49.7%

to EUR 112.60 million (previous year: EUR 75.20 million). This dynamic

increase in revenue resulted primarily from several content updates, game

launches and the KingsIsle acquisition.

Even more significant increases were achieved at the earnings level.

Compared to the previous year, EBITDA increased highly dynamically by

131.0% to EUR 65.00 million (previous year: EUR 26.50 million). EBITDA,

adjusted for one-off effects (e.g. special and restructuring costs from M&A

transactions), increased by 144.3% to EUR 71.10 million (previous year: EUR

29.10 million). The adjusted EBITDA margin also increased significantly to

28.0% (previous year: 21.0%). In our opinion, the very good company

performance is primarily the result of the economies of scale and synergy

effects achieved within the 'strongly interlinked' business fields of media

and games.

The corporate guidance issued by MGI management was thus exceeded. Our

revenue estimate (revenue: EUR 234.15 million) and earnings forecasts

(EBITDA: EUR 61.21 million, adjusted EBITDA: EUR 65.71 million) were also

exceeded, and our net forecast (net result: EUR 16.93 million) was almost


Forecasts and evaluation

With the publication of the preliminary figures, MGI has announced its

corporate guidance for the current business year. According to this

guidance, the company expects revenues in a range of EUR 290.0 million to

EUR 310.0 million and adjusted EBITDA in a range of EUR 80.0 million to EUR

90.0 million.

Based on this positive outlook and the currently highly convincing company

performance, we are significantly raising our previous revenue and earnings

forecasts for the financial years 2022 and 2023. For the current financial

year, we now expect revenues of EUR 302.22 million (previously: EUR 289.88

million) and an adjusted EBITDA of EUR 88.72 million (previously: EUR 86.53

million). For the following financial year 2023, we expect revenues of EUR

382.16 million (previously: EUR 362.41 million) and an adjusted EBITDA of

EUR 116.04 million (previously: EUR 111.83 million). In the following

financial year 2024, revenue and adjusted EBITDA should increase further to

EUR 478.26 million and EUR 145.78 million respectively. Against the

background that we expect higher interest expenses in the future than was

previously the case, we have only slightly increased our previous net

forecast for the financial year 2022 and slightly lowered our net forecast

for the financial year 2023.

In the past few years, the MGI Group has built up to a good starting point

to continue to grow very dynamically and highly profitably as an ad tech

company with its own gaming activities (access to 'first party data' and

advertising space of gaming assets). The combination of the synergetic

media and games business activities should continue to significantly boost

the profitable growth to date. In addition, the high level of cash on hand

(cash and cash equivalents at the end of 2021: approx. EUR 180.0 million)

offers the company the opportunity to further strengthen the group through

planned M&A transactions and thus to further increase the earning power and

the pace of growth.

Within the framework of our DCF valuation model, we have raised our

previous price target to EUR 9.20 (previously: EUR 8.50 per share) due to

our increased estimates for the financial years 2022 and 2023. In view of

the current share price level, we thus continue to assign a BUY rating and

see significant share price potential. The valuation results of our peer

group analysis (see below) also support our assessment of the

attractiveness and price potential of the MGI share.

Die vollständige Analyse können Sie hier downloaden:


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Date (time) of completion: 08/03/2022 (18:43 pm)

Date (time) of first distribution: 09/03/2022 (10:30 am)

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