Bank: “HOLD on Viaplay”
October 26, 2022
Analysts at investment bank Jefferies have advised shareholders to hold onto their Viaplay shares despite the broadcaster’s “multi-faceted downgrades” and the talking points which followed on from the company’s Q3 results.
The bank, in its snapshot ‘First View’ report, admits that Viaplay’s business is “flagging” and not helped by the “immediate effects of the general economic slowdown on advertising and subscription sales”.
It summarises Viaplay’s results saying that its Q3 2022 subscribers are in-line, net sales -4.8 per cent behind and the EBIT loss of -SEK 171 million compares to consensus on -SEK 236 million.
“Within the mix, Nordic subscribers were -5 per cent behind, International +11.2 per cent ahead. Nordic net subscriber adds +395,000 Q-o-Q (from +458,000 in 2Q/2022), International +685,000 (from +307,000 in 2Q/2022), notes the report.
Viaplay’s guidance for the rest of 2022 says its organic sales growth will slip to about 20 per cent (from up to 28 per cent) previous guidance. Its Nordic sales growth is also downgraded to about 10 per cent from 20 per cent previously. Its Viaplay subscriber numbers are guided to be unchanged at an overall 7.3 million but this is made up from a lower Nordic total (4.6 million) and an improved International at 2.7 million (from 2.5 million).
On the upside, Jefferies reminds investors that its overall subscriber base is still guided to be about 12 million by the end of 2025, with International EBIT going “positive” a year earlier in 2024 (previously in 2025).