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North Media

North Media

Leading print ad distributor

North Media is the only media company listed on the OMX Copenhagen Stock Exchange. While the company started as a distributor of unaddressed printed advertisements and newspapers in 1965, the company is today considered both a value and a growth company. The company’s Last Mile segment (86% of ’21 sales) is its cash cow, but it is operating in an industry with structurally declining volumes. Its Digital Services segments (14% of ’21 sales) consists of BoligPortal (home rentals platform), Ofir (job portal), and Bekey (digital access solutions).

Despite the growing importance of ESG, offline media remains popular in Denmark, with ~80% of Danish households receiving local newspapers and ~66% receiving leaflets. To cater to this need, the Last Mile segment offers a strong and efficient distribution platform, and the segment has obtained an even stronger market position in Denmark following PostNord’s exit from the market in 2017. In addition, North Media’s Digital Services segments offer high growth rates and improving profitability in the years ahead.

There are three main risks to the company: 1) the implementation of regulations or bans against physical advertisements on the back of environmental concerns, which in the worst case could put the Last Mile segment almost completely out of business, 2) stiff competition facing the Digital Services segments, and 3) difficulties in finding new growth opportunities in the Digital Services segments.

DKKm 2021 2022e 2023e
Sales 1034 1030 1041
Sales growth (%) -1,1 -0,4 1,1
EBITDA 292 237 240
EBITDA margin (%) 28,3 23 23,1
EBIT adj 244 209 212
EBIT adj margin (%) 23,6 20,3 20,4
Pretax profit 347 245 250
EPS rep 15,12 10,55 10,78
EPS growth (%) -10,7 -30,2 2,1
EPS adj 16,44 11,32 11,55
DPS 0 0 0
EV/EBITDA (x) 4,1 2,5 2
EV/EBIT adj (x) 4,9 2,8 2,3
P/E (x) 7,1 7,5 7,4
P/E adj (x) 6,6 7 6,9
EV/sales (x) 1,2 0,6 0,5
FCF yield (%) 7,5 9,8 10
Dividend yield (%) 0 0 0
Net IB debt/EBITDA -2,6 -3,6 -4
Lease adj. FCF yield (%) 7,5 9,8 10
Lease adj. ND/EBITDA -2,6 -3,6 -4
DKKm 2021 2022e 2023e
Sales 1034 1030 1041
COGS -413 -427 -432
Gross profit 621 602 609
Other operating items -328 -365 -369
EBITDA 292 237 240
Depreciation on tangibles -29 -28 -29
Depreciation on intangibles -2 -2 -2
EBITA 268 223 226
Goodwill impairment charges 0 0 0
Other impairment and amortisation 0 0 0
EBIT 244 209 212
Other financial items 0 0 0
Net financial items 98 36 38
Associated income -1 -1 -1
Other EO items 154 40 43
Pretax profit 347 245 250
Tax -73 -54 -55
Net profit 274 191 195
Minority interest 0 0 0
Net profit discontinued 0 0 0
Net profit to shareholders 274 191 195
EPS 15,12 10,55 10,78
EPS Adj 16,44 11,32 11,55
Total extraordinary items after tax 0 0 0
Tax rate (%) -21,2 -22 -22
Gross margin (%) 60 58,5 58,5
EBITDA margin (%) 28,3 23 23,1
EBITA margin (%) 26 21,7 21,7
EBIT margin (%) 23,6 20,3 20,4
Pretax margin (%) 33,2 23,8 24
Net margin (%) 26,1 18,5 18,7
Growth rates Y/Y 2021 2022 2023
Sales growth (%) -1,1 -0,4 1,1
EBITDA growth (%) 8,1 -18,8 1,3
EBIT growth (%) 1,7 -14,4 1,4
Net profit growth (%) -10,7 -30,2 2,1
EPS growth (%) -10,7 -30,2 2,1
Profitability 2021 2022 2023
ROE (%) 595,3 762,1 1246,5
ROE Adj (%) 647,3 817,9 1336
ROCE (%) 201,6 166,9 181,8
ROCE Adj(%) 215,3 176,3 191,8
ROIC (%) 63,6 50,7 51,4
ROIC Adj (%) 63,6 50,7 51,4
Adj earnings numbers 2021 2022 2023
EBITDA Adj 292 237 240
EBITDA Adj margin (%) 28,3 23 23,1
EBITA Adj 268 223 226
EBITA Adj margin (%) 26 21,7 21,7
EBIT Adj 244 209 212
EBIT Adj margin (%) 23,6 20,3 20,4
Pretax profit Adj 371 259 264
Net profit Adj 298 205 209
Net profit to shareholders Adj 298 205 209
Net Adj margin (%) 28,4 19,9 20,1
Depreciation and amortisation -24 -14 -14
Of which leasing depreciation 0 0 0
EO items 0 0 0
Impairment and PPA amortisation -24 -14 -14
EBITDA lease Adj 292 237 240
EBITDA lease Adj margin (%) 28,3 23 23,1
Leasing payments 0 0 0
DKKm 2021 2022e 2023e
EBITDA 292 237 240
Net financial items 98 36 38
Paid tax -73 -54 -55
Non-cash items -94 -59 -60
Cash flow before change in WC 223 160 163
Change in WC -58 0 0
Operating cash flow 165 160 163
CAPEX tangible fixed assets -18 -18 -18
CAPEX intangible fixed assets 0 0 0
Acquisitions and disposals 0 0 0
Free cash flow 147 142 145
Dividend paid -91 -91 -91
Share issues and buybacks 0 0 0
Other non cash items 99 49 51
Decrease in net IB debt 262 236 245
Balance Sheet (DKKm) 2021 2022 2023
Goodwill 39 39 39
Indefinite intangible assets 7 0 0
Definite intangible assets 10 8 7
Tangible fixed assets 290 290 290
Other fixed assets 78 77 76
Fixed assets 351 351 351
Inventories 6 6 6
Receivables 82 82 82
Other current assets 0 0 0
Cash and liquid assets 883 983 1088
Total assets 1321 1421 1526
Shareholders equity 34 16 16
Minority 0 0 0
Total equity 34 16 16
Long-term debt 113 113 113
Pension debt 0 0 0
Convertible debt 0 0 0
Deferred tax 11 11 11
Other long-term liabilities 6 6 6
Short-term debt 5 5 5
Accounts payable 110 110 110
Other current liabilities 5 5 5
Total liabilities and equity 275 256 256
Net IB debt -758 -858 -963
Net IB debt excl. pension debt -758 -858 -963
Capital invested 322 322 322
Working capital -29 -29 -29
EV breakdown 2021 2022 2023
Market cap. diluted (m) 1955 1441 1441
Net IB debt Adj -758 -858 -963
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 1197 582 478
Capital efficiency (%) 2021 2022 2023
Total assets turnover (%) 82,4 75,1 70,7
Capital invested turnover (%) 335,4 368,7 400
Capital employed turnover (%) 115,5 91,4 78,1
Inventories / sales (%) 0,4 0,4 0,4
Customer advances / sales (%) 0,9 0,9 0,9
Payables / sales (%) 4,1 4,2 4
Working capital / sales (%) -5,6 -2,8 -2,7
Financial risk and debt service 2021 2022 2023
Net debt / equity (%) -2207 -5441,7 -6203,2
Net debt / market cap (%) -38,4 -59,6 -66,8
Equity ratio (%) 2,6 1,1 1
Net IB debt adj. / equity (%) -2207 -5441,7 -6203,2
Current ratio (%) 782,3 863,2 947,5
EBITDA / net interest (%) 6087,5 4477,2 4534,3
Net IB debt / EBITDA (%) -259,4 -361,8 -400,7
Interest cover (%) 5071,7 4213,1 4270,2
Lease liability amortisation 0 0 0
Other intangible assets 10 10 10
Right-of-use asset 0 0 0
Total other fixed assets 12 12 12
Leasing liability 7 7 7
Total other long-term liabilities 0 0 0
Net IB debt excl. leasing -765 -865 -970
Net IB debt / EBITDA lease Adj (%) -261,7 -364,6 -403,5
DKKm 2021 2022e 2023e
Shares outstanding adj. 18 18 18
Fully diluted shares Adj 18 18 18
EPS 15,12 10,55 10,78
Dividend per share Adj 0 0 0
EPS Adj 16,44 11,32 11,55
BVPS 59,67 65,22 70,99
BVPS Adj 57,51 63,06 68,83
Net IB debt / share -41,9 -47,4 -53,2
Share price 108,97 79,6 79,6
Market cap. (m) 1972 1441 1441
Valuation 2021 2022 2023
P/E 7,1 7,5 7,4
EV/sales 1,16 0,57 0,46
EV/EBITDA 4,1 2,5 2
EV/EBITA 4,5 2,6 2,1
EV/EBIT 4,9 2,8 2,3
Dividend yield (%) 0 0 0
FCF yield (%) 7,5 9,8 10
P/BVPS 1,81 1,22 1,12
P/BVPS Adj 1,88 1,26 1,16
P/E Adj 6,6 7 6,9
EV/EBITDA Adj 4,1 2,5 2
EV/EBITA Adj 4,5 2,6 2,1
EV/EBIT Adj 4,9 2,8 2,3
EV/cap. employed 7,5 4,1 3,4
Investment ratios 2021 2022 2023
Capex / sales 1,8 1,8 1,7
Capex / depreciation 75,7 128,7 130,1
Capex tangibles / tangible fixed assets 6,2 6,2 6,3
Capex intangibles / definite intangibles 0 0 0
Depreciation on intangibles / definite intangibles 0 0 0
Depreciation on tangibles / tangibles 8,3 4,8 4,8
Lease adj. FCF yield (%) 7,5 9,8 10

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Main shareholders - North Media

Main shareholders Share capital % Voting shares % Verified
Richard Bunck 55.7 % 55.7 % 31 Dec 2021
North Media A/S 9.5 % 9.5 % 31 Dec 2021
Olav W. Hansen 5.0 % 5.0 % 18 Feb 2020
eQ Asset Management Oy 2.0 % 2.0 % 30 Jun 2022
Lærernes Pension 1.8 % 1.8 % 31 Dec 2021
Fundamental Fondsmæglerselskab A/S 1.6 % 1.6 % 30 Apr 2022
Gudme Raaschou Asset Management 1.1 % 1.1 % 30 Apr 2022
Herald Investment Management 0.9 % 0.9 % 31 Dec 2021
Kåre Stausø Wigh 0.6 % 0.6 % 21 Feb 2022
Dimensional Fund Advisors 0.4 % 0.4 % 30 Jun 2022
Source: Holdings by Modular Finance AB