Enero posts 25% increase in net revenue, while Australia jumps 24.5% due to Orchard Marketing acquisition

Enero – the holding group behind agencies like BMF, Hotwire, Frank, Orchard Marketing, and The Leading Edge – has posted a 25% increase in net revenue to $129.5m and a 53% jump in earnings before interest, tax, depreciation and amortisation (EBITDA) to $20.7m for FY19.

Australia’s net revenue was up 24.5% to $60m, due to Enero’s acquisition of Orchard Marketing in the second half of FY18, an agency which is primarily based in Australia. Excluding the acquisition, the market’s organic revenue was flat.

Enero’s key FY19 results. (Click to enlarge)

International markets represented 54% of net revenue and 61% of operating EBITDA. Australia’s operating EBITDA climbed 20.2% to $10.7m.

The local market’s operating EBITDA margin declined slightly year on year (18.5% in FY18 and 17.8% in FY19), but Enero noted this is in line with the expected industry range.

“We have delivered an excellent set of results for FY2019 with strong numbers across our key financial metrics in all markets,” said Enero Group CEO Matthew Melhuish.

“There is positive momentum in many areas of the Group coming from new business wins and new talent joining the Group. The achievement of 14% organic revenue growth, excluding the impact of acquisitions, demonstrates we can achieve more working together as a Group.”

Australia made up 30% of net revenue for FY19 (Click to enlarge)

Overall operating EBITDA margin improved to 16%, while net profit after tax to equity holders was $5.7m. Directors declared a final dividend of 3c per share, fully franked, and the ratio of staff costs is trending down to land on 68.1% versus 2018’s 69.7%, and operating costs down from 17.5% to 16% due to “rental efficiencies”.

“As we enter a new strategic phase, we have further simplified our outward facing brands but more importantly put more strength and capabilities in the larger businesses,” Melhuish added.

“We will continue to build digital and data capabilities and we remain ready to invest further through acquisitions in our international network, particularly in the USA, which has experienced incredible growth this year.”

Enero’s Melhuish

Enero’s top client represents 12% of the group’s net revenue and the top 10 clients 34%. The Orchard acquisition has given Enero greater exposure to clients in the auto and healthcare sectors.

Across the financial year, Orchard Marketing added healthcare clients Flordis and Avant Mutual, while BMF won Tourism Tasmania, Agoda, and various government projects.

Earlier this year, former Enero agency Naked was absorbed into BMF as part of Enero’s strategy of “reimagining the future and building strong businesses that take advantage of the changing marketing landscape”.


Get the latest media and marketing industry news (and views) direct to your inbox.

Sign up to the free Mumbrella newsletter now.



Sign up to our free daily update to get the latest in media and marketing.