CentralNic Group - Flying high with 62% organic revenue growth

CentralNic has delivered another record quarter, with pro forma last 12 months organic revenue growth of 62% to 30 June 2022 (53% to 31 March 2022), driven by the performance of the Online Marketing division. CentralNic’s privacy-safe approach to online marketing has proved resilient and to be high growth. As a result, H122 revenue is expected to be US$335m (H121: US$175m), with adjusted EBITDA of US$38m (H121: US$20.5m), a margin of 11.3% (Q122: 11.8%). Both H122 revenue and adjusted EBITDA figures represent 58% of our FY22 estimates (revenues US$573m, adjusted EBITDA US$66m). Management is guiding towards CentralNic meeting at least the upper end of market expectations for FY22, disclosed as revenues of US$603m and adjusted EBITDA of US$70m, although this appears conservative given the annual run-rate. CentralNic trades on an undemanding rating given its growth (FY22 EV/adjusted EBITDA of 6.8x and P/E of 9.5x). We will review our forecasts with the full H122 results due on 30 August.