First Berlin Equity Research has published a research update on ad pepper media International N.V. (ISIN: NL0000238145). Analyst Dr. Karsten von Blumenthal reiterated his BUY rating and decreased the price target from EUR 4.60 to EUR 4.40.

ad pepper media International (APM) has published preliminary Q2/22 figures which are close to our forecasts and significantly below the prior year figures. Group revenue declined 10% y/y to €5.9m and group EBITDA fell from €1.04m in Q2/21 to €-0.19m (FBe: €-0.07m) due mainly to weaker Webgains figures. Webgains has been hit by the weakness of its main market, the UK. Management is thus focusing on improving sales and earnings in the UK. Due to the difficult macroeconomic environment management expects Q3/22 revenue to be roughly on par with Q2/22 with a slight decline in operating costs q/q. This indicates slightly better earnings q/q. Given its strong balance sheet, APM is well prepared to weather the business cycle downturn, which may offer new business opportunities if competitors streamline their product offering or exit regional markets. We stick to our full-year revenue forecast but lower our EBITDA estimate slightly to reflect the slightly weaker than expected Q2 earnings. An updated DCF model yields a €4.40 price target (previously: €4.60). We reiterate our Buy rating.