Research Note - Playmaker Capital (PMKR:TSXV) - Q3 Is Another Strong Showing Of Growth Through Acquisition

Yesterday after market close, Playmaker Capital reported Q3/22 financial results. During the quarter PMKR acquired World Soccer Talk, Juanfutbol, and closed a $20.0M convertible loan facility; furthering their strategy of growth through acquisition. In addition to acquisitions, PMKR showed accelerating organic growth speaking to the high quality of content the group is distributing. Year over year growth was largely in part due to acquisitions made in the latter part of 2021.

 

The quarter is encouraging from an organic growth perspective and another step in the right direction for building out a long-term sustainable business. While we are enthusiastic about the acquisitions, we are cognizant of the convertible facility now representing a burden on future returns. PMKR remains focused on getting more eyes to their content and is looking forward to a Q4/22 with amazing potential due to the world cup and the potential increase in audience from a finish which could include prevalent Latin American competitors.

 

Highlights from the quarter include:

 

  • Revenue of $8.8M (+84% YoY) vs. our estimate of $7.4M.

  • Gross margin of 90% vs. our estimate of 92% and 90% in Q2.

  • Adjusted EBITDA (ex. corporate) of $2.3M (26% margin) vs. our estimate of $2.2M (26% margin). Adjusted EBITDA including corporate came in at $1.1M vs. our estimate of $1.0M.

  • PF Revenue came in at $10.0M and PF Adj. EBITDA came in at $2.7M

  • PMKR ended the quarter with a cash balance of $14.0M ($8.5M of this balance was used in the Wedge transaction October 17, 2022)

 

 

Acquisitions: During Q3, PMKR made four acquisitions; World Soccer Talk, JuanFutbol, Pasion Aguila, and Planeta Boca Juniors. The acquisitions focus on soccer and are made with prudent timing in the run up to world cup 2022 in Qatar. Having a focused exposure to Latin America the acquisitions play into PMKR’s strategy of identifying and executing on targets which will allow them to sell focused direct advertising.


20221115 - M Partners - PMKR - Q3 Financials
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