Vend Marketplaces (VEND) Q4 2017 earnings summary

Executive summary

• 2017 revenue rose 7% to NOK 16,943m and EBITDA increased 22% to NOK 2,606m; growth was led by online classifieds and digital media revenue.

• Digital products generated 71% of revenue; the operating model was reorganized into Marketplaces and Media divisions, effective 2018.

Financial highlights

• Revenue was NOK 16,943m vs NOK 15,854m; EBITDA was NOK 2,606m vs NOK 2,131m.

• Operating profit reached NOK 3,315m vs NOK 1,237m; profit before tax was NOK 3,144m vs NOK 1,258m, and net income was NOK 2,186m vs NOK 559m.

• Adjusted EPS was NOK 3.43 vs NOK 2.70, excluding other income and expenses and impairment losses, net of related tax and non-controlling interests.

• Other income and expenses were NOK 1,505m, including NOK 821m sale gains and NOK 490m gains from remeasurement of prior interests in staged acquisitions.

• Operating cash flow was NOK 1,290m vs NOK 1,506m; investment cash outflow was NOK 4,546m, chiefly reflecting acquisitions and investments.

Outlook and guidance

• Developed online classifieds retained a 15–20% annual revenue growth target for the next 3–5 years, driven by monetization and structural online-market growth.

• 2018 priorities include mobile services and common scalable platforms; investment-phase losses are expected to decline, with several sites nearing break-even, subject to monetization and competition.

• Media houses will continue digital product development and cost adaptation; weak print advertising could pressure margins over the coming 12 months.