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Flexion Mobile

Flexion Mobile

Reaching a wider Android market

Flexion is primarily a game distributor on the alternative Android market (which does not include Google Play or China). It offers game developers an opportunity to reach a wider Android market than Google Play, through its full service offering and unique technology, without any additional effort for the game developer itself. The Android mobile games market is growing strongly, with Google Play as the frontrunner. We believe that the alternative Android market has a good chance to match it, or even grow faster in percentage terms.

We believe that Flexion has established a strong market position within the alternative Android market, and is well positioned to reap the benefits of the current fragmentation trend. We regard the fiscal year 2018/19 as a proof of concept. If Flexion is able to keep broadening its game portfolio and enhance its distribution power through new channel deals, it will lead the company to a bright future.

Long-term risks include dependence on key partners, increased competition, and consolidation in the Android market. We think that key channel partners are of particular importance to Flexion, as they are limited. There is currently no direct competitor to Flexion, because it is a first-mover in a niche market, but we expect increased competition. Furthermore, the current fragmentation wave on the Android market will not last forever. Eventual consolidation is likely, which might decrease the value Flexion brings to its customers.

GBPm 2021 2022e 2023e
Sales 33 56 79
Sales growth (%) 58 71,3 42,1
EBITDA 0 6 11
EBITDA margin (%) 0,5 11,6 13,4
EBIT adj 0 4 7
EBIT adj margin (%) 0,9 6,5 9
Pretax profit 0 4 7
EPS rep 0 0,06 0,12
EPS growth (%) 112,1 1816,8 89
EPS adj 0 0,06 0,12
DPS 0 0 0
EV/EBITDA (x) 349,7 9,4 5,1
EV/EBIT adj (x) 183 16,7 7,6
P/E (x) 387,8 20,1 10,7
P/E adj (x) 387,8 20,1 10,7
EV/sales (x) 1,6 1,1 0,7
FCF yield (%) 9,2 -1,6 14
Dividend yield (%) 0 0 0
Net IB debt/EBITDA -95,9 -1,4 -1,7
Lease adj. FCF yield (%) 9,2 -1,6 14
Lease adj. ND/EBITDA -96,3 -1,4 -1,7
GBPm 2021 2022e 2023e
Sales 33 56 79
COGS -28 -43 -58
Gross profit 4 13 21
Other operating items -4 -7 -11
EBITDA 0 6 11
Depreciation on tangibles 0 0 0
Depreciation on intangibles -1 0 0
EBITA 0 4 7
Goodwill impairment charges 0 0 0
Other impairment and amortisation 0 0 0
EBIT 0 4 7
Other financial items 0 0 0
Net financial items 0 0 0
Associated income 0 0 0
Other EO items 0 0 0
Pretax profit 0 4 7
Tax 0 0 0
Net profit 0 3 7
Minority interest 0 0 0
Net profit discontinued 0 0 0
Net profit to shareholders 0 3 7
EPS 0 0,06 0,12
EPS Adj 0 0,06 0,12
Total extraordinary items after tax 0 0 0
Tax rate (%) -38 -4,4 -5
Gross margin (%) 13,1 23,7 26,8
EBITDA margin (%) 0,5 11,6 13,4
EBITA margin (%) 0,9 6,5 9
EBIT margin (%) 0,9 6,5 9
Pretax margin (%) 0,9 6,5 9
Net margin (%) 0,5 6,2 8,6
Growth rates Y/Y 2021 2022 2023
Sales growth (%) 58 71,3 42,1
EBITDA growth (%) 602,2 4229,1 64,2
EBIT growth (%) 122,6 1176,1 95,9
Net profit growth (%) 114,1 1922 95,3
EPS growth (%) 112,1 1816,8 89
Profitability 2021 2022 2023
ROE (%) 1,4 23,5 34
ROE Adj (%) 1,4 23,5 34
ROCE (%) 2,4 24,6 35,7
ROCE Adj(%) 2,4 24,6 35,7
ROIC (%) -14,1 113,7 106,1
ROIC Adj (%) -14,1 113,7 106,1
Adj earnings numbers 2021 2022 2023
EBITDA Adj 0 6 11
EBITDA Adj margin (%) 0,5 11,6 13,4
EBITA Adj 0 4 7
EBITA Adj margin (%) 0,9 6,5 9
EBIT Adj 0 4 7
EBIT Adj margin (%) 0,9 6,5 9
Pretax profit Adj 0 4 7
Net profit Adj 0 3 7
Net profit to shareholders Adj 0 3 7
Net Adj margin (%) 0,5 6,2 8,6
Depreciation and amortisation 0 -3 -3
Of which leasing depreciation 0 0 0
EO items 0 0 0
Impairment and PPA amortisation 0 0 0
EBITDA lease Adj 0 6 11
EBITDA lease Adj margin (%) 0,5 11,6 13,4
Leasing payments 0 0 0
GBPm 2021 2022e 2023e
Total liabilities and equity 28 25 33
Net IB debt -14 -9 -18
Net IB debt excl. pension debt -14 -9 -18
Capital invested -1 7 5
Working capital -9 -2 -2
EV breakdown 2021 2022 2023
Market cap. diluted (m) 67 70 73
Net IB debt Adj -14 -9 -18
Market value of minority 0 0 0
Reversal of shares and participations 0 0 0
Reversal of conv. debt assumed equity 0 0 0
EV 52 61 55
Capital efficiency (%) 2021 2022 2023
Total assets turnover (%) 143,8 211,5 274,3
Capital invested turnover (%) -3228,6 19415,4 14546,9
Capital employed turnover (%) 236,1 310,3 251
Inventories / sales (%) 0 0 0
Customer advances / sales (%) 0 0 0
Payables / sales (%) 27,9 11,8 9,6
Working capital / sales (%) -18 -10 -2,7
Financial risk and debt service 2021 2022 2023
Net debt / equity (%) -110 -55 -77
Net debt / market cap (%) -20,4 -13,8 -26,4
Equity ratio (%) 47 66,2 71,3
Net IB debt adj. / equity (%) -110 -55 -77
Current ratio (%) 135,3 183,9 267,4
EBITDA / net interest (%) 1693,3 51870,2 189193,2
Net IB debt / EBITDA (%) -9589,1 -140,5 -169
Interest cover (%) 3236,1 29219,8 127209
EBITDA 0 6 11
Net financial items 0 0 0
Paid tax 0 0 0
Non-cash items 0 0 0
Cash flow before change in WC 0 6 10
Change in WC 6 -7 0
Operating cash flow 7 -1 11
CAPEX tangible fixed assets 0 0 0
CAPEX intangible fixed assets 0 0 0
Acquisitions and disposals 0 0 0
Free cash flow 6 -1 10
Dividend paid 0 0 0
Share issues and buybacks 0 0 0
Other non cash items -4 -4 -1
Decrease in net IB debt -3 10 1
Balance Sheet (GBPm) 2021 2022 2023
Goodwill 0 0 0
Indefinite intangible assets 0 0 0
Definite intangible assets 1 1 1
Tangible fixed assets 0 0 0
Other fixed assets 0 0 0
Fixed assets 8 9 8
Inventories 0 0 0
Receivables 5 6 7
Other current assets 0 0 0
Cash and liquid assets 14 9 18
Total assets 28 25 33
Shareholders equity 13 17 23
Minority 0 0 0
Total equity 13 17 23
Long-term debt 0 0 0
Pension debt 0 0 0
Convertible debt 0 0 0
Deferred tax 0 0 0
Other long-term liabilities 0 0 0
Short-term debt 0 0 0
Accounts payable 15 8 9
Other current liabilities 0 0 0
Lease liability amortisation 0 0 0
Other intangible assets 8 9 7
Right-of-use asset 0 0 0
Total other fixed assets 0 0 0
Leasing liability 0 0 0
Total other long-term liabilities 0 0 0
Net IB debt excl. leasing -14 -9 -18
Net IB debt / EBITDA lease Adj (%) -9632,8 -141,8 -170,2
GBPm 2021 2022e 2023e
Shares outstanding adj. 50 53 54
Fully diluted shares Adj 53 56 58
EPS 0 0,06 0,12
Dividend per share Adj 0 0 0
EPS Adj 0 0,06 0,12
BVPS 0,26 0,32 0,43
BVPS Adj 0,24 0,3 0,41
Net IB debt / share -0,3 -0,2 -0,3
Share price 1,42 1,26 1,26
Market cap. (m) 71 66 68
Valuation 2021 2022 2023
P/E 387,8 20,1 10,7
EV/sales 1,61 1,09 0,69
EV/EBITDA 349,7 9,4 5,1
EV/EBITA 183 16,7 7,6
EV/EBIT 183 16,7 7,6
Dividend yield (%) 0 0 0
FCF yield (%) 9,2 -1,6 14
P/BVPS 4,79 3,98 2,92
P/BVPS Adj 5,19 4,24 3,07
P/E Adj 387,8 20,1 10,7
EV/EBITDA Adj 349,7 9,4 5,1
EV/EBITA Adj 183 16,7 7,6
EV/EBIT Adj 183 16,7 7,6
EV/cap. employed 4 3,7 2,3
Investment ratios 2021 2022 2023
Capex / sales 1 0,5 0,5
Capex / depreciation -240,2 9,5 10,4
Capex tangibles / tangible fixed assets 0 0 0
Capex intangibles / definite intangibles 33,1 26,6 32,3
Depreciation on intangibles / definite intangibles -13,8 280,8 311,5
Depreciation on tangibles / tangibles 0 0 0
Lease adj. FCF yield (%) 9,2 -1,6 14

Equity research

Read earlier research

Media

Flexion Mobile - Company presentation with CFO Niklas Koresaar
Flexion Mobile - Company update with Flexion Mobile after M&A deals

Main shareholders - Flexion Mobile

Main shareholders Share capital % Voting shares % Verified
Mobile Sensations Ltd 22.0 % 22.0 % 31 Dec 2021
Carl Palmstierna 6.8 % 6.8 % 18 May 2022
Fredrik Palmstierna 4.6 % 4.6 % 31 Dec 2021
Odey Asset Management LLP 4.4 % 4.4 % 31 Mar 2022
Joachim Odqvist 3.1 % 3.1 % 31 Dec 2021
eQ Asset Management Oy 3.1 % 3.1 % 31 May 2022
Avanza Pension 2.6 % 2.6 % 31 Dec 2021
Sjätte AP-fonden 2.4 % 2.4 % 31 Dec 2021
Aktia Asset Management 0.7 % 0.7 % 31 Mar 2022
Aktieinvest Fonder 0.3 % 0.3 % 31 May 2022
Source: Holdings by Modular Finance AB

Insider list - Flexion Mobile

Name Quantity Code Date
Mikael Pawlo + 12 000 BUY 25 Aug 2021
Mikael Pawlo + 100 000 BUY 24 Aug 2021
Carl Gustaf Evert Palmstierna - 100 000 SELL 24 Aug 2021

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