Vend Marketplaces (VEND) Q4 2015 earnings summary

Executive summary

• 2015 revenue rose 1% to NOK 15,117m; reported EBITDA reached NOK 2,016m, while EBITDA excluding investment-phase operations was NOK 2,527m.

• Online classifieds growth and digital media revenue helped offset structural declines in print; reported operating profit was NOK 2,161m, including material non-recurring gains and impairment charges.

• A NOK 2.64bn net equity raise strengthened financial flexibility for growth, including acquisitions and investment in digital products and technology.

Financial highlights

• Operating revenue was NOK 15,117m versus NOK 14,975m in 2014; reported EBITDA was NOK 2,016m versus NOK 1,941m.

• Net income was NOK 1,391m versus a NOK 127m loss; profit attributable to owners was NOK 1,263m versus a NOK 180m loss.

• Reported operating profit rose to NOK 2,161m from NOK 510m; other income and expenses were NOK 1,079m, including NOK 858m from remeasurement of previously held interests.

• Adjusted EPS was NOK 3.17 versus a NOK 0.73 loss; reported EPS was NOK 5.79 versus a NOK 0.84 loss.

• Operating cash flow was NOK 993m versus NOK 1,230m, with the decline largely linked to less favorable working-capital movements.

Outlook and guidance

• Established online classifieds sites retain a mid- to long-term annual revenue growth target of 15–20%; established operations are expected to combine growth potential with healthy margins.

• 2016 investment-phase spending affecting profitability, across consolidated operations and joint ventures, is expected to be around the 2015 level.

• Central technology and product investment had a net negative profit effect of around NOK 150m in 2015; this is expected to rise to NOK 250–300m in 2016.

• Media-house priorities are digital product development and cost adaptation, targeting healthy cash flows and operating margins amid continued structural change.

• The Hemnet 80% acquisition was expected to close in H1 2016, subject to Swedish competition clearance.