Topic: CLIQ reported final FY23 figures on Thursday (update on prelims from Feb. 5th) and announced a € 13m share repurchase program. Here are our key takeaways:

Strong bundled content share boosts higher-LTV customer base. At 94% of FY23 total revenues (88% in FY22), bundled content across 25+ portals continued to grow its share of total revenues at the expense of single content (300+ portals), strengthening customer retention due to offering several streaming verticals “all­-in-one." This strategy has proven very rewarding over the past quarters and has increased LTV per customer by 17% yoy to now € 85. The company is on track to improve its content catalogue across all verticals, and particularly CLIQ’s position in cloud gaming looks promising since it capitalizes on the rapidly advancing market, expected to grow by 46% CAGR until 2030 (Statista).

2024e guidance & growth outlook. Management released a weaker-than-expected 2024 guidance of € 360-380m in revenues and € 52-58m EBITDA. Sales are now seen to come in at c. €  375m or +15% yoy (eNuW old: € 402m), while EBITDA should amount to c. € 55m or +10% yoy (eNuW old: 63m), mainly driven by (1) ongoing headwinds in traffic acquisition and conversion in a still challenging macroeconomic environment and (2) increased costs for both customer acquisition (eNuW: € 157m) as well as elevated licensing fees for higher-quality content (eNuW: € 64m). Having said that, several growth drivers should help the company reach its c. € 500m mid-term sales target along with strong EBITDA and cash flow generation, including further geographic expansion into Latin America and Asia (currently still < 7% of sales) as well as intensifying affiliate marketing with trusted B2B partners (e.g. FAZ and LIDL in Germany) to position CLIQ as a unique D2C brand.

Share buyback program. The company announced a share buyback program of up to € 13m (c. 10% of the shares outstanding; 43% of 2023 operating cash flow), which will be carried out over the next 12 months via open market purchases. (Note: Financial impact not yet included in our estimates). While this share buyback may come at the expense of a dividend payout in 2024 (subject to shareholder approval), in our view, the decision reflects management's continued commitment to shareholder value creation and the closing of the price-value gap embedded in the company's current stock price.

We maintain our BUY rating with a changed PT of € 65.00 (old: € 75) based on FCFY 24e.