I will try to be a bit positive again, even though my primary thought would be about changing the title: Ilkka – wallet emptied, fortunately there’s Alma.
The acquired Custobar has at least managed to grow further in H1, and its result has grown as well. The EV/EBITDA of the acquisition based on the “forecast” after H1 (H2 = H1) is approx. 15, and with the same forecast, growth would be around 20% on an annual basis.
EBITDA of approx. €0.8M would be 12.5%, but presumably this percentage should increase more as the headcount remains roughly the same and revenue grows.
Last year, the improvement in EBITDA and profit (EBITDA from 5.7% → 11.5% and profit from €55k → €388k) seems to have come largely through headcount reductions (26 → 19), despite the growth.
If that kind of +20% growth with an improving EBITDA margin were to continue in the future, the purchase would be quite good indeed.
Now I just doubt that the growth will continue like this, and I’m also a bit worried about how significant the key person risk might be. On the technical side of Custobar, there appears to be one founder and six employees. The founder just sold their entire stake, and apparently the whole payout was in cash. Will they be motivated to work flat out for this joint starting next Monday?
Let’s wait and wonder, and collect dividends, since I just raised my average price with small purchases at 3.8xE. Let’s enjoy the story.