Enero Group continues growth trajectory with 38.9% revenue increase

Enero Group, the parent company of BMF, Hotwire and Orchard, has reported $129.5 million in net revenue in its latest half-year result, up 38.9% compared to the previous corresponding period, led by its Creative Technology and Data division.

For the six months ended 31 December 2022, the earnings before interest, taxes, depreciation and amortisation (EBITDA) was $44.3 million, up 38.9% year-on-year (YoY).

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Net profit after tax attributable to equity holders was $14.8 million, up 8.1% YoY from $13.7 million in FY22.

Enero Group CEO, Brent Scrimshaw, said: “Our financial results in the first half of FY23 are driven by a continued focus on our operating strategy and the strong execution across our diversified portfolio.

“While the macroeconomic environment has led to some market headwinds, each business in our portfolio continues to contribute to the Group’s profitability, with the Creative Technology & Data segment, in particular, delivering a standout performance.

“Enero’s deep and enduring client relationships and the strategic relevance of our market-leading capabilities are key differentiators for continued business success.

“In today’s dynamic global marketplace, this progressive capability mix continues to build upon our strong track record of sustainable revenue and EBITDA growth and positions us well to capitalise on the digital agendas and brand transformation solutions for clients worldwide.”

The creative technology & data division witnessed the most growth with its net revenue up 57% to $61.8 million, which was primarily driven by OBMedia’s diversified capabilities and benefits from scale.

Orchard was impacted by health client delays and the timing of client conferences which was partially offset by some growth in consumer clients.

The brand transformation division witnessed a relatively slower 26% growth to $67.7 million, benefiting from the acquisition of ROI DNA and GetIT under Hotwire. 

On a group level, OBMedia boosted the overall growth, but it was partially offset by declines in organic net revenue in Hotwire, BMF and Orchard due to current macroeconomic environment conditions and the sale of the TLE to Fiftyfive5 in May 2022.

Enero said second-half margins at Hotwire will benefit from cost savings initiatives implemented in late Q2.

The Group’s cash balance decreased to $38 million at the end of December due to the aforementioned acquisitions of ROI DNA and GetIT and repayments of $10.3 million of debt.

FY23 H1 operating cash flow was $5.5 million, with cash conversion at 36% due to two large customer payments to OBMedia and BMF which were received just after half-year end. Adjusting for these payments cash conversion was at 74%.

Looking into 2023, the group expected the brand transformation segment to continue to see the impact of slower client decision-making and conservatism across all geographies and in some cases, constrained client budgets.

Enero Group trades at $2.28 on 16 February, with a market capitalisation of $211.40 million.


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