CentralNic’s H123 trading update shows that revenue, EBITDA and margins have continued to grow in the year, giving us confidence in our forecasts, which we leave unchanged. On 3 July, management announced that it was increasing its FY23 share buyback programme up to £34m, a £30m uplift from when it was first announced in May, highlighting management’s commitment to maximising shareholder returns.
With its FY22 dividend now paid and the company focusing more on organic growth, management remains aligned to its waterfall model for free cash flow allocation, which we analysed in our Q123 update.
CentralNic reported gross revenue of US$396m (+18% y-o-y), net revenue of US$91m (+11% y-o-y) and EBITDA of US$44m (+15% y-o-y, 48.4% EBITDA/net revenue margin) in its H123 trading update. On a quarterly basis, the group expanded EBITDA to net revenue to over 50% in Q2 from 47% in Q1, driven by operating leverage and ahead of our full year forecast of 49.5% (vs 48.4% in FY22).
CentralNic Group Plc (LON:CNIC) is one of the world’s leading providers of internet infrastructure services. The company provide tools for those who wish to go beyond consuming internet content. CentralNic’s services are designed for those who seek to contribute, to communicate, to build, to promote and to earn online.