North Media - Equity performance outweighs commercial lag
Solid equity performance, with limited commercial news Recent data points to have limited financial impact We reiterate our estimates and FVR Company has already flagged an unexciting Q2 Due to continued COVID-19 lockdowns across Denmark in April and May along with the platform upgrade in BoligPortalen, Q2’21 is flagged to be a relatively slow quarter. We estimate FK distribution, BoligPortal and Bekey to deliver -5%, 1% and -10% growth respectively for the quarter, however we expect continued strong momentum in Ofir (+50% y-o-y). As a result, we estimate -4% organic growth and an EBIT margin of 24. 7% (up 2.
6pp y-o-y but -1. 8pp q-o-q) for Q2’21e. We believe North Media will deliver a return on securities of ~DKK 31m during the quarter based on strong price development for Genmab, DSV, Novo Nordisk, SEA, Nvidia and Paypal, which are up an aggregated 5-6%.
We expect limited financial impact on recent news In FK Distribution, we track the ‘NoThanks’ subscribers, which is slightly down to 32. 1% during Q2’21 compared to 32. 5% in Q1’21, yet still up from 29.
8% in Q2’20. In addition, following up on an agreement with a residential service company in Q1’21 for 18k residential stairways, Bekey announced a collaboration with Nemlig. com to deliver to 26k stairways of groceries.
The company did not publish a statement, so we imagine the collaboration to have limited financial impact in the short term. Lastly, FK Distribution’s appeal against the competition authority’s ruling in June ’20 was rejected, and the company is considering further legal action. There is no news regarding a potential fine related to the matter or any potential next steps; however, we expect more news on the topic in the Q2 report.
We reiterate our estimates and FVR We make no estimate changes in this report and reiterate our FVR of DKK 103-156/share, equal to an EV/EBIT of 4-8x in ’22e.