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We reduce EBITDA forecasts, updating for last November’s trading statement and the September 2016 acquisition of Dot Property. This is not a reflection of Mitula’s operational performance, which continues to progress to strategy, but of additional investment in its self-serve platform, expansion into the fashion vertical and the strengthening of its market capabilities. Mitula is growing strongly, enjoys high EBITDA margins and is well financed. The 40% EV/EBITDA discount to its peer group average deserves investor attention.
Mitula Group
Mitula Group (MUA), a leading aggregator of online classified listings, has delivered H116 normalised profit of A$5.6m, a year-on-year increase of 94%. H116 normalised EBITDA of A$7.14m was 3.4% below the company’s guidance issued in May due to weaker currency and trading conditions in the South American markets. However, Mitula delivered a record EBITDA margin of 52.5%, up from 43.7% y-o-y, and this is superior to its peer group’s median EBITDA margin of 32.8%. MUA is trading at a 46% discount to our blended valuation of A$1.40/share.
Mitula Group (MUA) is a leading aggregator of online classified listings, operating in the global online advertising market. While MUA reports on a calendar year basis, it has reaffirmed its 30 June 2016 prospectus forecast for NPAT of A$10.1m. Our NPAT forecast for this period is within 1.2% of current guidance. More significantly, MUA has identified new revenue streams from its emerging markets that could lead to a medium-term revenue uplift not currently forecast.
Mitula Group is a leading aggregator of online classified listings, operating in the global online advertising market. Its specific growth techniques, together with existing scale and a focus on higher-growth markets, should drive medium-term growth ahead of the sector, we believe. The company listed on ASX in July 2015, raising A$26.52m gross at an offer price of A$0.75/share. Mitula Group is already profitable, has met its prospectus guidance for CY15, is on track to meet its 2016 fiscal year prospectus forecasts, and has made its first post-IPO acquisition, buying Spain-based real estate classifieds aggregator, Nuroa Internet SL for ~€3m (A$4.47m).
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