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Original-Research: NFON AG - from NuWays AG

28.02.2025 / 09:00 CET/CEST

Dissemination of a Research, transmitted by EQS News - a service of EQ

Group.

The issuer is solely responsible for the content of this research. The

result of this research does not constitute investment advice or an

invitation to conclude certain stock exchange transactions.

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Classification of NuWays AG to NFON AG

Company Name: NFON AG

ISIN: DE000A0N4N52

Reason for the research: Update

Recommendation: BUY

from: 28.02.2025

Target price: EUR 12.30

Target price on sight of: 12 month

Last rating change:

Analyst: Philipp Sennewald

Strong FY24p highlighted by superb FCF; chg.

Topic: NFON released preliminary FY24 figures, showing a stronger than

expected top- and bottom-line as well as an extraordinarily strong FCF. In

detail:

FY24 sales increased 6.1% yoy to EUR 87.3m (eNuW: EUR 86.1m; eCons: EUR 86.5m)

driven by moderate seat growth (+1.4% to 665k) as well as premium solutions.

Notably, non-recurring sales were up 95% yoy in Q4, indicating a strong

effect from botarios project business and also a strong growth in Q4 as well

as FY24 by the newly acquired subsidiary (consolidated since 09/24).

According to CEO Heider, the company exceeded expectations and thus made a

strong contribution to the FY result. Importantly, recurring revenues grew

5.1% yoy to EUR 81.1m (in line with eNuW), implying a recurring revenue ratio

of 92.9%.

FY24 adj. EBITDA improved disproportionately by 48% yoy to EUR 12.3m (eNuW: EUR

12.0m; eCons: EUR 11.3m), implying a margin of 14.1% (+3.9pp yoy). The

improved profitability was mainly driven by an improved product mix (i.e.

premium solutions), the imposed efficiency measures as well as the

margin-accretive

acquisition of botario (c. 30% EBITDA margin). Reported EBITDA was in line

with our estimates at EUR 10.8m.

The clear highlight of the release however was the FCF, which improved

strongly from EUR 1.0m in FY23 to EUR 6.5m in FY24 and was substantially ahead

of our estimate (eNuW: EUR 3.8m). The strong increase was mainly driven by the

improved profitabilty as well as lower CapEx (eNuW).

New guidance. For FY25e, management targets sales to grow by 8-10% (eNuW

new: +10.4%) and an adj. EBITDA of EUR 13.5-15.5m (eNuW new: EUR 15.8m). In our

view, both should be well achievable even at the upper end of the range.

This should be driven by (1) the continuous efficiency gains, (2) a further

improvin

product mix as well as (3) the introduction of new solutions like NFON

Intelligent Assistent or voice mail transcription.

Despite the recent share price jump (+45% YTD), this is still not adequately

reflected in the share price, in our view, given a valuation of 7.3x

EV/EBITDA FY25e (5.5x FY26e).

We hence reiterate BUY with an increased EUR 12.30 PT (old: EUR 11.70) based on

DCF. The stock remains part of our NuWays Alpha List.

You can download the research here: http://www.more-ir.de/d/31869.pdf

For additional information visit our website:

https://www.nuways-ag.com/research-feed

Contact for questions:

NuWays AG - Equity Research

Web: www.nuways-ag.com

Email: research@nuways-ag.com

LinkedIn: https://www.linkedin.com/company/nuwaysag

Adresse: Mittelweg 16-17, 20148 Hamburg, Germany

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Diese Meldung ist keine Anlageberatung oder Aufforderung zum Abschlu

bestimmter Börsengeschäfte.

Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben

analysierten Unternehmen befinden sich in der vollständigen Analyse.

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2093177 28.02.2025 CET/CEST

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