North Media: Lower costs drive positive earnings surprise - ABG

2% revenue beat; 20% EBIT beat driven by lower costs
We take '23e EBIT up ~3% to the higher end of guidance
FVR of DKK 58-96 (54-92); '23e DKK 44/share net cash position


Q1 revenues roughly in line; significant EBIT beat

North Media posted Q1 revenues of DKK 240.0m (+2% vs. ABGSCe at DKK 235.7m), equivalent to negative ~3% y-o-y growth. EBIT came in at DKK 43.8m (+20% vs. ABGSCe at DKK 36.6m), corresponding to a margin of 18.3%, with the beat driven primarily by lower distribution and logistics costs. Q1 also saw a DKK 103.8m gain on the investment portfolio (vs. ABGSCe at DKK 110.4m), leading to a 3% EPS beat vs. ABGSCe, while adj. EPS came in 33% higher than us. The very wide FY'23 guidance, with group revenues of DKK 920m-975m and an EBIT margin of 14-16%, was reiterated.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/north-media/Equity-research/2023/5/north-media---lower-costs-drive-positive-earnings-surprise/