Topic: Netfonds released final FY23 figures that fell short of prelims due to one-off effects. Further, the company reported record Q1 prelims above expectations, proofing that it is on track to reach its FY24 and mid-term guidance. In detail:

FY23 gross sales came in at € 193m (+9% yoy vs prelims: € 197m), mainly driven by AuC that grew by 11% to € 23.8bn (eNuW: € 23.2bn). Thanks to material expenses that remained stable relatively to sales at 81% (vs 80.9% in FY22) net sales grew by 9% yoy to € 39.4m, above prelims of € 37m.

EBITDA of only € 4.9m (-24% yoy), came in below prelims (€ 6.2m), mainly due to two one-off effects to the tune of € 1.7m stemming from a cancelled software contract and from the at equity consolidation of two investments. Total OPEX of € 34.4m (+17% yoy) was hence higher than the anticipated € 30.8m. EBT came in at € 0.7m (vs € 2m in FY22, vs prelims: € 2.2m) resulting from € 3.6m D&A and a financial result of € 0.1m.

Looking into FY24, Netfonds kicked-off the year with a record quarter. The company achieved gross sales of € 56m (20% yoy, 9% qoq), significantly above our estimates of € 50m carried by AuC that exceeded € 25.1bn (19% yoy vs € 23.8m in FY23). As material expenses should have remained rather stable yoy, net sales grew by 18% yoy to 9.5m. Thanks to scale effects that start to kick-in, EBITDA came in at € 0.9m (+125% yoy), bringing EBT into positive terrain with € 0.3m (vs € -0.4m in FY22).

Going forward, record AuC after Q1, paired with stock markets that reached new all-time highs in Q2, top- and bottom line should continue to grow in H2, even without new AuC inflows that we consider as very likely. Further, the Groups proprietary 360° finfire platform is seen to fuel consolidation of the insurance broker market that is, in contrary to the investment adviser market, still highly fragmented. Thanks to finfire, the selling and managing of insurance products is much easier unlocking enormous cross-selling potentials, as the already onboarded investment adviser can additionally offer a wide range of insurance products to its customers. finfire hence remains the company´s key mid- to long term growth and scalability driver.

In order to reflect strong Q1 results, the bright market outlook and the enormous (cross-selling) potential arising from finfire, we reiterate BUY with an unchanged PT of € 73.00 (old: € 73.00), based on DCF.