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Eksterne analyser

G5 Entertainment: Not a clear trend shift in sight yet - ABG

G5 Entertainment

Dette er en ekstern analyse og afspejler ikke nødvendigvis vores perspektiv eller værdier.

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Negative trend sustained, but there are a few growth options in H2
We cut adj. EBIT 12-8% on 2025e-2027e
Trading at 5x EV/FCF '25e; half of market cap in net cash


Organic growth improving, but slower than expected

The organic growth improved somewhat q-o-q but at a lower rate than we expected, from -15% to -11% y-o-y (vs. ABGSC -5%). There were some positive aspects of the report, including the biggest title, Sherlock, growing q-o-q (+2%) and continued high growth for G5 Store (+39% y-o-y and +8% q-o-q measured in USD). The conversion of sales through G5 Store gives a higher gross margin. G5 Store now comprises 23% of sales (15%), and we expect it will continue to increase. Interestingly, management said it will open up G5 Store to external developers, which could add another high-margin revenue stream with revenues potentially starting already in 2025. This, combined with a positive trend for Sherlock and the new release of Twilight Land in H2, we think could significantly improve the organic growth trend, although we expect the core portfolio to continue declining near-term.
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