Awardit: Key clients continue to invest more in loyalty - ABG

Solid org. growth of 12%, but a tad weaker profitability
Adj. EBITA cut by 2%, 5%, and 4% on '23e-'25e
Positioned for strong growth, trading at 10x EV/EBITA


Overall stable in a seasonally weak quarter

Awardit delivered solid growth in a seasonally weak Q1. Organic growth of 12% was driven by existing Loyalty customers continuing to grow their programs and new customers in Gift Cards compensating for a lower retail volume. We were happy to see that Zupergift continues to see rapid growth, with volumes up 100% y-o-y. Adj. EBITA of SEK 9.5m (vs. ABGSCe of SEK 11.5m) was hurt by unusually high redemption rates in MBXP and weaker volumes in Prämie. However, management said the outlook for Prämie in Q2 was better. Connex was integrated in the quarter. As it had a bigger cash position than the purchase price, there was a net cash inflow of SEK 22m from the acquisition. According to management, Connex and Prämie have already started working on integrating their offerings to achieve synergies. Moreover, due to a strong H2'22 for Connex, the acquisition multiple is now 6.3x, down from 7.6x initially. With synergies, the realised multiple will likely be even lower.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/awardit/Equity-research/2023/5/awardit---key-clients-continue-to-invest-more-in-loyalty/