Eletromidia’s share rises more than 4% today after the media market leader out of home report a first quarter with strong growth in all verticals and a net profit that exceeded consensus by 4x.
The company led by Alexandre Guerrero had net revenue of R$242 million, 30% above the same period last year and 12% above the Bloomberg consensus.
Growth was strong across all verticals, but driven mainly by the ‘street’ business, which is the company’s largest and grew 45% in the quarter, to R$140 million.
Eletromidia added 792 panels in the last twelve months and also benefited from the digitalization of existing panels, which has increased sales and the profitability of the operation. (Today, 73% of the company’s panels have already been digitized, which allows for more flexible campaigns and better measurement of results).
The buildings vertical, in which Eletromidia installs panels in the elevators of residential and commercial buildings, also had a robust expansion, growing 62% year on year, with the addition of 753 panels in the quarter.
The transport and shopping verticals grew 31% and 17%, respectively.
Alex Dias, the manager of São Pedro Capital, one of the largest shareholders in the free float of the company, said that the result draws even more attention because it was in the first quarter, which is seasonally bad for the sector.
“The first quarter is usually very weak in this sector because the advertiser is redefining the budgetthere is no clear definition of the strategy, and the flow of people is also weaker, because there are a lot of people traveling,” said the manager.
Despite these seasonalities, Alex said that the company managed to position itself well to capture a good Carnival for consumption, which helped in the quarter.
“In addition, they are closing new contracts every quarter, entering new cities, and have interesting initiatives, such as entering SMEs.”
Eletromidia also managed to expand its EBITDA in the quarter, with an increase of 51%, to R$77 million. The margin went from 27.1% to 31.6%.
The big highlight of the quarter, however, was the net profit, which was R$22 million — 6x higher than the first quarter of last year and 4x higher than the consensus of the sellside.
An analyst who covers the company said that operations “were much better.”
“EBITDA was R$17 million higher than expected and this led to profit. As they tend to have very low numbers this quarter, the percentage was huge,” he said.
Eletromidia’s shares rose 20% in the last twelve months, with the company worth R$2.7 billion on the stock exchange.
Pedro Arbex
Tags: Electromedia soars profit greater consensus
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