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North Media

North Media

Leading print ad distributor

North Media’s history dates back to 1965, when the distribution of unaddressed printed advertisements and newspapers was its main activity. The company has since diversified its product offering to include advertisement-funded internet distribution activities. North Media is the only media company listed on the OMX Copenhagen Stock Exchange. It operates four segments: FK Distribution, North Media Newspapers, North Media Online and BEKEY.

Offline media remains popular in Denmark, with ~75% of Danish households receiving it. Because the number of supermarkets is declining, the industry demands tailored marketing solutions, and North Media offers a strong distribution platform. We believe that the company can therefore leverage its position to increase prices. In addition to its strong offline position, North Media is also expanding its digital efforts, where good expansion opportunities exist.

There are three main risks to the business: 1) the implementation of regulations against physical advertisements and/or an increased negative perception of offline advertisements, 2) increased penetration of online marketing from competitors and its market share versus print media, and 3) difficulties finding growth opportunities in the three smaller segments of the company.

DKKm 2019 2020e 2021e
Sales 1130 1101 1079
Sales growth (%) -1,3 -2,6 -2
EBITDA 191 195 199
EBITDA margin (%) 16,9 17,8 18,5
EBIT adj 160 168 173
EBIT adj margin (%) 14,2 15,3 16
Pretax profit 268 169 174
EPS rep 11,11 7,2 7,41
EPS growth (%) 277,5 -35,2 2,9
EPS adj 11,02 7,2 7,41
DPS 4 4,5 4,5
EV/EBITDA (x) 2,3 0,7 -0,1
EV/EBIT adj (x) 2,8 0,8 -0,1
P/E (x) 4 5,1 5
P/E adj (x) 4 5,1 5
EV/sales (x) 0,4 0,1 0
FCF yield (%) 14,7 20,8 21,2
Dividend yield (%) 9 12,1 12,1
Net IB debt/EBITDA -1,8 -2,5 -3,2
DKKm 2019 2020e 2021e
Sales 1130 1101 1079
COGS -541 -498 -476
Gross profit 589 603 602
Other operating items -398 -407 -403
EBITDA 191 195 199
Depreciation on tangibles -29 -26 -25
Depreciation on intangibles -2 -2 -1
EBITA 160 168 173
Goodwill impairment charges 0 0 0
Other impairment and amortisation 0 0 0
EBIT 160 168 173
Other financial items 0 0 0
Net financial items -12 -6 -5
Associated income 117 6 6
Other EO items 2 0 0
Pretax profit 268 169 174
Tax -62 -39 -40
Net profit 205 129 133
Minority interest 0 0 0
Net profit discontinued 0 0 0
Net profit to shareholders 205 129 133
EPS 11,11 7,2 7,41
EPS Adj 11,02 7,2 7,41
Total extraordinary items after tax 1,7 0 0
Tax rate (%) -23,3 -23,3 -23,3
Gross margin (%) 52,1 54,8 55,8
EBITDA margin (%) 16,9 17,8 18,5
EBITA margin (%) 14,2 15,3 16
EBIT margin (%) 14,2 15,3 16
Pretax margin (%) 13,3 14,8 15,5
Net margin (%) 7,8 11,2 11,8
Growth rates Y/Y 2019 2020 2021
Sales growth (%) -1,3 -2,6 -2
EBITDA growth (%) 38,9 2,5 1,9
EBIT growth (%) 46,1 4,8 3
Net profit growth (%) 267,9 -37 2,9
EPS growth (%) 277,5 -35,2 2,9
Profitability 2019 2020 2021
ROE (%) 33,9 17,5 15,2
ROE Adj (%) 33,7 17,5 15,2
ROCE (%) 37,9 20 17,8
ROCE Adj(%) 37,7 20 17,8
ROIC (%) 35,8 38,7 41,1
ROIC Adj (%) 35,8 38,7 41,1
Adj earnings numbers 2019 2020 2021
EBITDA Adj 191 195 199
EBITDA Adj margin (%) 16,9 17,8 18,5
EBITA Adj 160 168 173
EBITA Adj margin (%) 14,2 15,3 16
EBIT Adj 160 168 173
EBIT Adj margin (%) 14,2 15,3 16
Pretax profit Adj 266 169 174
Net profit Adj 204 129 133
Net profit to shareholders Adj 204 129 133
Net Adj margin (%) 7,6 11,2 11,8
DKKm 2019 2020e 2021e
EBITDA 191 195 199
Net financial items -12 -6 -5
Paid tax -62 -39 -40
Non-cash items 0 0 0
Cash flow before change in WC 117 151 153
Change in WC 2 1 1
Operating cash flow 130 152 154
CAPEX tangible fixed assets -12 -14 -13
CAPEX intangible fixed assets 1 0 0
Acquisitions and disposals 2 0 0
Free cash flow 121 138 141
Dividend paid 55 5 5
Share issues and buybacks 1 0 0
Other non cash items -35 3 0
Decrease in net IB debt 155 146 145
Balance Sheet (DKKm) 2019 2020 2021
Goodwill 39 39 39
Indefinite intangible assets 3 0 0
Definite intangible assets 11 10 8
Tangible fixed assets 250 238 226
Other fixed assets 86 92 98
Fixed assets 389 378 371
Inventories 5 4 4
Receivables 89 92 90
Other current assets 0 0 0
Cash and liquid assets 485 631 776
Total assets 968 1105 1241
Shareholders equity 671 805 943
Minority 0 0 0
Total equity 671 805 943
Long-term debt 123 123 123
Pension debt 0 0 0
Convertible debt 0 0 0
Deferred tax 10 10 10
Other long-term liabilities 9 9 9
Short-term debt 11 11 11
Accounts payable 42 45 44
Other current liabilities 102 102 102
Total liabilities and equity 968 1105 1241
Net IB debt -351 -497 -642
Net IB debt excl. pension debt -351 -497 -642
Capital invested 339 327 319
Working capital -50 -51 -52
EV breakdown 2019 2020 2021
Market cap. diluted (m) 821 666 666
Net IB debt Adj -351 -497 -642
Market value of minority 0 0 0
Reversal of shares and participations -26 -32 -38
Reversal of conv. debt assumed equity 0 0 0
EV 444 137 -15
Capital efficiency (%) 2019 2020 2021
Total assets turnover (%) 126 106,2 92
Capital invested turnover (%) 329,3 330,5 334
Capital employed turnover (%) 153,3 126,2 107,1
Inventories / sales (%) 0,4 0,4 0,4
Customer advances / sales (%) 0,9 0,9 0,9
Payables / sales (%) 4,1 4 4,2
Working capital / sales (%) -4,3 -4,6 -4,8
Financial risk and debt service 2019 2020 2021
Net debt / equity (%) -52,3 -61,7 -68,2
Net debt / market cap (%) -51,5 -74,6 -96,4
Equity ratio (%) 69,4 72,9 75,9
Net IB debt adj. / equity (%) -52,3 -61,7 -68,2
Current ratio (%) 373,7 459,9 554,6
EBITDA / net interest (%) 1643,1 3550,7 3692,1
Net IB debt / EBITDA (%) -184,2 -254,4 -322,6
Interest cover (%) 1318,9 2907,7 3054,7
DKKm 2019 2020e 2021e
Shares outstanding adj. 18 18 18
Fully diluted shares Adj 18 18 18
EPS 11,11 7,2 7,41
Dividend per share Adj 4 4,5 4,5
EPS Adj 11,02 7,2 7,41
BVPS 36,37 44,84 52,5
BVPS Adj 33,64 42,12 49,87
Net IB debt / share -19 -27,7 -35,8
Share price 36,93 37,1 37,1
Market cap. (m) 682 666 666
Valuation 2019 2020 2021
P/E 4 5,1 5
EV/sales 0,39 0,12 -0,01
EV/EBITDA 2,3 0,7 -0,1
EV/EBITA 2,8 0,8 -0,1
EV/EBIT 2,8 0,8 -0,1
Dividend yield (%) 9 12,1 12,1
FCF yield (%) 14,7 20,8 21,2
P/BVPS 1,22 0,83 0,71
P/BVPS Adj 1,32 0,88 0,74
P/E Adj 4 5,1 5
EV/EBITDA Adj 2,3 0,7 -0,1
EV/EBITA Adj 2,8 0,8 -0,1
EV/EBIT Adj 2,8 0,8 -0,1
EV/cap. employed 0,6 0,1 0
Investment ratios 2019 2020 2021
Capex / sales 1 1,2 1,2
Capex / depreciation 37 49,4 50,8
Capex tangibles / tangible fixed assets 4,9 5,7 5,9
Capex intangibles / definite intangibles -8,9 0 0
Depreciation on intangibles / definite intangibles 15,2 15,9 17,9
Depreciation on tangibles / tangibles 11,4 10,9 10,9

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Main shareholders - North Media

Main shareholders Share capital % Voting shares % Verified
Richard Bunck 55.7 % 55.7 % 31 Dec 2019
North Media A/S 10.5 % 10.5 % 3 Mar 2020
Olav W. Hansen 5.0 % 5.0 % 18 Feb 2020
Mads Dahl Andersen 1.1 % 1.1 % 31 Dec 2019
Fundamental Fondsmæglerselskab A/S 0.9 % 0.9 % 31 Dec 2019
C WorldWide Asset Management 0.7 % 0.7 % 31 Dec 2019
MP Pension 0.6 % 0.6 % 29 Feb 2020
Kåre Stausø Wigh 0.4 % 0.4 % 31 Dec 2019
BIL Danmark 0.3 % 0.3 % 29 Feb 2020
Sparinvest 0.3 % 0.3 % 29 Feb 2020
Source: Holdings by Modular Finance AB