CLIQ Digital reported final figures (preliminary figures and guidance 2023 already out; see comment dated February 1st) and held a webinar where management reiterated strategy and growth prospects. In a nutshell, we still believe in the USP of CLIQ’s unique business model: value-for-money streaming content at very attractive price point and with curated bundles in a world of “overpriced content overload”.

At 88% of total revenues vs. 72% in FY 2021, bundled content continues to grow its share of total revenues at the expense of single content. This is a positive as a bundled content offering several streaming verticals “all-in-one” helps customer retention. North America accounts for a growing share of revenues at 57% of total (FY 2021: 50%). Currency effects, with a strong dollar, do skew the picture accounting for 7 percentage points of the reported 84% yoy sales growth, and we hence anticipate a more balanced geographic split in FY 2023. Europe is up a healthy 62% yoy with the replication of the own-media buying, bundled content approach in full swing.

The German all-in-one service cliq.de was launched mid-December 2022, with most impact therefore expected in FY 2023. The multi-media (online, TV, OoH) marketing campaign will extend over Q1 and Q2. At € 6.99 /months for an attractive bundle of movies & series, music, audiobooks, sports and games, the package is a highly differentiated newcomer in the “silo” landscape of overpriced single-content verticals available (see graph on p.2), especially for the mass-market. As a reminder, 53% of German households do not subscribe to any streaming service. Pricing might be the reason as 82% of German are not willing to spend more € 15 a month for streaming services. CLIQ is also looking at ad-funded models to broaden its addressable market.

The 2023 guidance of > € 345m in revenues; > € 50m in EBITDA and > € 120m in marketing spend clearly shows the magnitude of the growth on offer. Some of the marketing budget (eNuW: € 10-20m) will go into the brand and will be directly expensed.  Management also highlighted that cliq.de might be a blue print for other European market launches.

We roll over valuation to the average of FCFY 23E and 24E and derive a PT of € € 76.6 (€ 70). BUY.