OB Media

1/ What is OB Media ?
OB Media is owned at 51 % by Enero.
It has a rather unique profile of high growth (+ 63 % in FY 22) and exceptional margin (operating EBITDA margin of 76 % in FY 22).
In FY 22, OB Media had revenues of 58 m.

2/ What's their business ?
"it is a programmatic media platform business which connects publishers with the world's largest search engines*.
The business functions as a platform and therefore has achieved a higher margin than other businesses in the group".
Unfortunately, Enero is quite secretive about this business. So we do not have much details regarding its business model.

3/ What's driving its growth in FY 22
- there was an acceleration of OB Media growth during H2 (revenue of + 73 % in H2 22 after + 52 % in H1 22; some positive fx impact in H2 vs H1)
- 3 elements given by Enero to explain such a growth : search engine partnership growth, 120 % increase in customers delivered to advertisers to 285 m, 30 % improvement in traffic conversion.
- "in FY, first 5 weeks...The Creative Technology** segment has continued its strong financial performance".

4/ Valuation
In FY 22, Enero's 51 % in OB Media represented 55 % of Enero's operating EBITDA (excluding OB Media minority interests) or 22.5 m.
So, if we take the extreme assumption that all the other Enero's business are valued at 0, their share in OB Media is valued at 260 m which represents a ratio EV/EBITDA of 11.6 x.
That looks cheap given OB Media profile, both in terms of growth and profitability.


* Google is likely to be their main customer. Interesting to see that Enero's major customer in this division had 21.7 m revenues in FY22 vs 19.9 m in FY 21; so the large revenue increase in FY 22 did not come from this customer in FY 22 and the company was able to diversify its customer basis.
** essentially OB Media