Earnings call transcript: Moltiply Group Q4 2024 sees strong revenue growth

Moltiply Group SpA reported robust financial results for the fourth quarter of 2024, with significant year-over-year increases in both revenue and EBITDA. The company’s stock surged by 6.91% following the announcement, reflecting strong investor confidence. According to InvestingPro data, the stock currently trades at €7.03, showing notable volatility with a beta of 1.94. The company has maintained dividend payments for 17 consecutive years, demonstrating consistent shareholder returns. The full-year revenue reached €454 million, marking a 13.1% increase from the previous year, while net income rose by an impressive 42.1%.

Key Takeaways

• Q4 2024 revenues increased by 18.1% year-over-year.
• EBITDA for the full year grew by 13.6%.
• The company divested non-core assets and focused on operational efficiency.
• Positive outlook with anticipated high single-digit revenue growth.

Company Performance

Moltiply Group demonstrated strong performance across its business lines in Q4 2024, driven by strategic divestments and operational improvements. The company capitalized on market recoveries in the mortgage and insurance sectors, outperforming competitors in these areas. Despite challenges in the e-commerce sector due to Google advertising costs, Moltiply maintained its market position in key verticals.

Financial Highlights

• Q4 2024 Revenue: €454 million, up 18.1% YoY
• Full Year 2024 Net Income: Increased by 42.1% YoY
• Full Year 2024 EBITDA: Up 13.6% YoY

Outlook & Guidance

Looking ahead, Moltiply Group expects high single-digit revenue growth and low double-digit EBITDA growth. The company’s next earnings report is scheduled for March 21, 2025, as tracked by InvestingPro. Subscribers can access detailed financial forecasts and the comprehensive Pro Research Report, part of InvestingPro’s coverage of over 1,400 stocks. The company sees potential upside from regulatory developments, such as the Digital Markets Act investigation into Google, which could benefit its e-commerce operations. However, the outlook remains conservative due to broader market uncertainties.

Executive Commentary

Chairman Marco Pascarmona emphasized the company’s strong start to the year, stating, "We are starting the year with strength in a number of business lines." CFO Alessandro Fracassisio highlighted the ongoing integration of acquired businesses, saying, "We continue to fine-tune the acquired businesses."

Risks and Challenges

• E-commerce sector faces advertising cost challenges with Google.
• Potential headwinds in the automotive market.
• Broader economic uncertainties could impact growth projections.

Q&A

During the earnings call, analysts inquired about the recovery of the mortgage market, which the company confirmed. Questions also focused on the impact of Google advertising costs on the e-commerce sector and Moltiply’s flexible M&A strategy.

Full transcript - Moltiply Group SpA (MOL) Q4 2024:

Conference Operator: Good afternoon. This is the Colosco conference operator. Welcome and thank you for joining the presentation of Multiply Group Fourth Quarter twenty twenty four Results Conference Call. As a reminder, all participants are in listen only mode.

After the presentation, there will be an opportunity to ask questions. At this time, I would like to turn the conference over to Mr. Marco Pascarmona, Chairman Mr. Alessandro Fracassisio and Mr. Francesco Machandaro, CFO of Multipuy Group.

Please go ahead.

Marco Pascarmona, Chairman, Multiply Group: Thank you, and welcome everybody to our conference call. We will rely as usual on the presentation that was published on our website and start from Page 17 of the document with the full year highlights. And for full year 2024, our revenues are €454,000,000 which is up 13.1% year on year compared to €401,300,000 in the previous year. And this comes for 49% from our Maverick or Droking division and 51% from our Multiply or BPO division. EBITDA in the full year is million and that’s up 13.6% year on year compared to million in 2023.

And this comes for 54% from broking and 46% from BPO. EBIT is million. That’s up 15.3% year on year compared to the million of ’twenty three. And of course, as you know, EBIT is affected by significant amortization of PPA assets. Net income for 2024 is million.

That’s up 42.1% year on year compared to million in 2023. If we look on the following page at the fourth quarter, revenues are under, let me say something that I got missed. One important point is this asterisk here. Basically, let’s go back to the previous slide to the full year. We’ve just signed a contract just very recently to sell as more subsidiary of our DPO division, a company called FEMCOFINANTIEMENTI SEBIA that is authorized to operate as a lender and that was not giving us a particularly useful contribution and was causing a lot of complexity.

So we decided to discontinue this business by selling it. And so we are reporting our full year figures net of discontinued operations, which is not big basically. The contribution of Cenkraft in 2018 was in terms of net income contribution negative 900,000.0 and was more also in terms of revenues and so on. But the figures here and every time you see the asterisk are net of change of events in amenity. Again, it’s small, but it’s net of the figures and in the full year report, you will have all the details.

But again, it’s minor. And for ’twenty three also we adjusted figures, but for ’twenty three the adjustment is almost neutral in terms of net income. So sorry for this, going back to the Q4. In Q4, revenues were million, that’s up 18.1% year on year compared to million in Q4 of ’twenty three. And the revenues come for 48% from Drosin and 52% from BPO.

In terms of EBITDA, in Q4 ’twenty four, we reported million, that’s up 23.2% year on year compared to million in Q4 ’twenty three. And the EBITDA is not particularly relevant here. I mean, it’s million, which up a lot year on year, but this is just because in Q4 twenty twenty three, we recognized all the amortization of the year of the newly acquired assets basically and the results of the purchase price allocation in 2023 of Raftree Aper and the other foreign companies. So it’s not a very meaningful comparison. And looking at the net income also it’s €13,400,000 in Q4 ’twenty four, but the comparison to Q4 ’twenty three is not very meaningful because Q4 ’twenty three was also affected by this PPA amortization effect that was all concentrated in Q4 and twenty three.

On Page 19, we can go into the details of our fabric or broking division. And here the division for the full year posted revenues of million, that’s up 17.5% year on year compared to €188,100,000 in the previous financial year. The EBITDA is in the full year at €66,800,000 that’s up 10.1% compared to EUR 60,700,000.0 in 2023. And the EBIT is EUR 43,700,000.0, that’s up 7.5% year on year compared to EUR €40,700,000 of 2023. Looking just at the fourth quarter, the fourth quarter had an acceleration with revenues of million, up 23.8% year on year compared to the million of Q4 twenty twenty three.

The EBITDA in the fourth quarter is million, that’s up 15.5% year on year compared to the million of Q4 twenty twenty three. EBIT again for the same thing that I described before is million but cannot be really compared to Q4 of twenty twenty three. If you remember once every year we also provide figures about the breakdown of our revenues, so between the different business lines that compose the two divisions. And so here we are able to comment not only on the performance analysis but also to give these annual figures. And well, let’s start from the summary, which is that our view of the performance of the Americas division in 2024 is positive.

And we did this time, thanks to both organic growth and the contribution of the acquisition of Zwicco, which was consolidated from Q3 ’twenty four and price wise that was consolidated for Q4 twenty twenty four. And then not everything was perfect, but we will comment on that below. The expectations of ’25 are for growth for all the main business lines with the exception of e commerce by comparison, which has a more uncertain outlook and we will also comment on that in a second. So looking at the different business lines, we start with credit blocking. Credit blocking was the business line that was actually flattish or slightly down year on year.

And basically, we were expecting recovery of this is mostly mortgages and some personal loans. We were expecting recovery in ’twenty four, but the recovery was quite delayed and started entering only in the final part of ’twenty four. And now we are seeing the market, of course, up year on year and the situation looks much better than the first part of twenty twenty four. So on this, the outlook is at least for the short term visibility, it is an outlook of growth. We see demand year on year and good volumes.

And so we would expect the continuation of the trends of Q4 ’twenty four. Of course, all this is subject, this is the business that we have that is more subject to consumer confidence and so on. So there is global instability, of course, this could be affected. But for now, as I was saying, the outlook is positive and the continuation of what we have seen at the end of last year. Insurance growth, this is a business in which we have seen over the years very stable trends.

We continue to see double digit organic growth in ’twenty four. Actually, we did $40,000,000 of revenues, up 17.8% year on year compared to 33.9% in ’twenty three. So double digit organic growth and also thanks of course to rising insurance premiums. And here what we can say is that we expect growth to continue 25%. Telco and energy comparison was generated million of revenues.

In ’twenty four, that’s up a loss year on year almost 70% compared to million of an already good 2023. Here the growth comes in past, it is organic and partly it is attributable to the acquisition of Vicho, which was a good addition to our business portfolio and there is a synergy with the rest. And for 2025, we expect growth to continue even if mainly resulting from the enlargement of the consolidation area. On the next page, we have e commerce price comparison. Here, we have million of revenues in ’twenty four, that’s up 15.7% year on year compared to the million of revenues of 2023.

But the reoccupation is less satisfactory because we also had a very significant increase of traffic acquisition costs from Google so that the EBITDA contribution in euros of this business line to the division and to the group is lower than last year. So in terms of EBITDA, we did negative year on year. And so we contracted. And this is our performance in ’twenty four compared to ’twenty three in particular was affected in a significant way by some changes that Google introduced following entry to force of digital market charter. Basically, with those changes, we were able to drive more traffic to our website, but at a very high cost.

And overall, the net effect was favorable for our business. Now here, we are in a, as you know, in a very particular situation because the European Commission has opened in very quickly after the entry of force of the DMA, an investigation against Google for possible violations of the DMA with respect exactly to the favoring of Google Shopping vis a vis competing comparison services. And we hope that the commission will quickly conclude its investigations and basically do what it is, use the instruments at its disposal to ensure full compliance with the regulation. And on our side, just as our point of view, just as a point of view of all the other main comparison websites in Europe, Our point of view is that the current solution is not compliant, so we would expect consumption from the commission. And of course, our results here would be linked and dependent also on the actual enforcement of the D and A, which hopefully there is a one year kind of soft deadline for the commission should, we should start seeing things awfully soon.

But for now there is uncertainty. Finally, international markets which includes Spain, France, Mexico and now The Netherlands from twenty four of twenty twenty four did million of revenues 24%, that’s up 21.4% year on year compared to 53,000,000 in 2023. And here the comment is that things are going well organically, they did well organically, but also of course price wise contributed. We continue to fine tune the acquired businesses, So that in order to increase both their growth potential and also pay their profit potential. And now the expectation for 2025 is of continued organic growth.

This is mainly driven by the insurance comparison businesses in the different countries. And this is of course supplemented by the fact that with price wise, we are managing the consolidation area. So with this, I’m done on the Maverick division and I’d like to hand over to Alejandro for PPO. Hello, good afternoon everyone. Good morning.

It’s Martin from The U. S. So we are on Page 25. Let’s start looking at the numbers and then we’ll get into some comments both at the division overall on the single business line. But then what’s behind the performance of the year and also the outlook for 2025.

So as you can see, well, first of all, also here the note, it’s important to recall the note that Marco said before. So the numbers, both in terms of revenues, the detail in EBIT are net of discontinued operations that is the sale of our Argentina’s identity lending entity asset that we agreed to sell early March of this twenty twenty five. So all the space you should always remind this when looking at the numbers. So revenues are up 9.2% in 2024 from $230,000,000 to $233,000,000 basically. The EBITDA is up 18.1% year on year from 37.4 in 2023 to 56,000,000 in 2024.

That has also means that there is EBITDA margin improvement from 22% to 24% for the whole year in 2024. Also the EBIT increased 32.2% then looking at the EBITDA with the PQ and A is always difficult especially it’s not necessarily meaningful in terms of trend. But anyway, it went up 32.2% from 22,500,000.0 in 2023 to 29,700,000.0 in 2024. And there was obviously an improvement in the 2020 EBIT margin. Let’s look at the first quarter numbers, the financials and this year, this was a really positive quarter, even better than we expected.

And I’ll comment about it in a second, but we had a 13.2% growth in terms of revenues from 60,500,000.0 to 68,400,000.0 in the fourth quarter. And the EBITDA also increased 33.4% growing from 13,300,000.0 to 17,700,000.0. This has meant that we have increased our EDG margin from 22% to relatively 26%. The EDG also shows a very positive trend from 7,000,000 to 11,000,000, that’s 58.2% year on year growth and the EBIT margin increased from 11.5% to 16.1%. Again, these numbers do not include the negative impact that we have had in ’twenty four of these two discontinued operations.

So let’s comment this. Well, the first thing, we’re very proud of this result because all of these is organic or apart from a very small contribution in December of a small acquisition that we did. So you can consider this particularly organic and it means that the business has really resilient M and A to deliver growth. And if you have followed us the perspective for this year has actually improved along the year. Let’s try that positively then the credit market is really slow, market already mentioned on it.

And so this is the point we thought we would not be able to grow in 2024 and instead we were able also thanks to the recovery of the credit market, but also thanks to a good performance of multiplies, multiplies claims and multipliers. We really had a very, very positive second half of the year and also of the third quarter as I just commented. Again, the real news is the multi time mortgages, which as we see in effect on the delivered good growth overall on considering the full year, but really this growth was in the second half and especially in the last quarter. And this is thanks to not only the mortgage market as a whole, but also the fact that when we decrease in interest rates, we saw a resurgence in refinancing in the silverware, which as you know, is an important part of our outsourcing business with the car notary services that we offer to banks. So if we look at 30% to 35%, we really see that these growth trends can continue overall if you look at the overall division and obviously we will have different trends at the single business line level.

I will comment in the next pages on the different prospects of the value business lines. But overall, we do expect to continue this revenue growth and EBITDA growth. There are obviously markets for uncertainty. Well, I don’t know, let’s even comment on the political unrest and the things which obviously will impact potentially consumer confidence and that means that all the retail credit base, this particular would be impacted. But also let me just comment because some investors have also asked for it on the M and A transactions that are currently underway in the Italian market.

And so my comment assumes that there are no impact during 2025 and that’s really considerable considering the big uncertainty. What is the outcome of this corporate vehicle that we are seeing there? And also, we do not know what will be the impact in the end. Let me just comment, it’s not we can hear, but the value is the one that will interest, will impact us the most potentially is the Mediobanca and NPS deal. But again, because these are significant clients of the BPO division, both of them are significant clients in the BPO division.

So obviously, we don’t know what will be the potential restructuring that will happen afterwards. But again, I think it’s reasonable to assume that we will see the impact in 2025 and then obviously all of you have your views on what we have been here And it’s something really similar to say that the outcome of the single deals and then it’s not a really difficult decision of the value here. So it’s really hard to say and we saw it. So let’s get into the different business lines. I’m now on Page 28.

And so I’ll give a brief description of what’s underlying the results of 2024 and also an outlook of 2025 bearing in mind the uncertainties that I said before. So 2024 commodities were in the end as well as the year, so you say almost 20% growth on the full year here. However, especially when you compare these results to the Navios side, it seems much stronger. But the reason why this is much stronger is not in part to some of the senior client trends of the BPL division, which are not necessarily connected with markets. For example, yes, we have moved the past year as a client that it’s had a very strong growth in the mortgage market share and so we were able to focus on that.

But it’s also true that behind these numbers there are the parallel services and those services in terms of revenues are when the business grows, the single ticket has been cited has also the income of the notaries and that income has recently increased because of the fair tariff deal, however you want to call it, I mean, from echo content, fair compensation law that has come into action in the last quarter that has increased. So it’s not just a market effect here, you also see a mix effect. So there is more significant growth in terms of revenue of the ParaNortiva business, which will continue also in the next quarters. But now we are also seeing growth of the outsourcing of underwriting and commercial activities and we are seeing new clients growing and new clients coming in the world. So here the perspectives are positive.

And so we expect a new 2025 score for this business line, which was kind of the lever in ’twenty three and the first start of ’twenty four and also in ’twenty two. So this is where we are confident that we will see this will be an engine of the multi client division growth for 2025. Let’s go now to the real estate business. This one as we said really had the impact of the disappearing of the eco bond incentives. In reality, this business performed better than we expected.

We had expected a much steeper decline than this one. And this is because again the tail, both of the revenues, the margin of the activities related to the incentivized restructuring has continued into the second half of twenty twenty four. Now you see over in December was already basically year and in the last I mean very small, small, big activity, but they are not significant as the rest of the business has been in the last three years. So here, 2025 will be net of this activity. So let’s say, it declined.

We expected it declined less and then we expect it in 2025, we will still see that downward adjustment. Again, what are the other activities that we do here, we also do appraisals for credit related activities. So as the credit business, the credit market recovers, we will see growth of those activities. They will probably not be enough to offset the notification of the impact of the economics, but there is a space for opportunities for stabilization, but 2025 should still be declining at least from where we stand now. And therefore, for example, we applied a new client on the appraisal side.

So I mean, we will see both market and market share price. The next discipline is multi client loans. Here we saw recover growth actually just in growth in 2024. Unfortunately, this was more in revenues than margins Overall operating margin and EBITDA level kind of remained unchanged between ’thirty three and ’twenty four. We expect ’25 or ’25 maybe a little more growth in operating margin will be a decline in revenues, small declines in revenues and a little bit of adjustment.

We’re really focusing on efficiency here. But overall, this has been a very stable business line through the years and it delivers good margin. So we are happy with it. Then let’s go to Kain. So Kain has obviously been the star performer of 2024 and this really thanks to the big events of ’twenty three and ’twenty four, so the end of the tail and the end is also where most of the profits are because the claims that take longer to process are the larger ones, the more complex ones and those are inherently of higher margin for us because the value that we bring to the table helping companies with this claim which are larger can help them save money and if we need then they would recognize more important margins to us.

And so here you saw as well as in revenues but also especially in margin during 2024. This is almost 20% growth from 23%. This is a business that has really exploded in the last few years. What do we expect in 25%? We expect obviously a normalization, but which again, at least from where we stand now or the growth again market shares and so we do expect to have a ’25 that will be lower than ’24, but we do expect to be over the 23 levels So it’s not just a hump of revenue center stability, but we are on a multi year trend of growth and we hope to continue to continue to see the growth.

And North in fifteen days, we will finally see the obligation for companies and corporations to insure themselves for natural catastrophes. That means that there will be a new interesting endgame for us. And as you know, most of our activities are relative to property damages and things like this. So the fact that the insured base will increase will give us good opportunity for organic growth, but in terms of revenues and margin. So even this will take some time because basically the obligation pumping to close April 1.

So first people will have to ensure then and again it’s not very clear what happens if you do not think like which fluctuation situation in the regulation. So you don’t know which is going to be done. Anyway, anyway, there will be for sure a push in ensuring more and that’s easier to do because independent on the level of weather events and deep weather events, obviously if you if those events are in the peak areas that are more insured than in the past, There will be more insurance gains and therefore more need for our work. Then, the Absa which is mainly on our business line, it’s anyway continuing to grow, happy to grow at the pace of the division in ’twenty four. But I have to say here, as we already announced, we have renewed the management of this business line and we’ve seen we’ve probably also reinforced the whole team.

And we’ve seen a new and interesting pipeline on the commercial side. So we should be able to get new clients in the door and therefore unlock a little bit of growth also on this decline. It’s also fair to say as it’s stated here that some of the growth is also due to the fact that the markets, the financial markets per se in there in ’24, to ’23. And some of our contracts are down, are basically based on basis points that the assets are under management by our clients. And therefore, obviously, there is some growth, which is just connected to how the market performs.

And this is always been true since we had it in the last year. Finally, MultiFlyeze, which is the sum of our adventure television that are outsourcing for lease and rental and our MultiDrive Tech, which is a software company that provides solutions and core solutions for the leasing market. Here the good news is we are also launching a rental software product, rental platform. We are launching in these days. We are getting a first time thing there.

Well, the result was good. Then the full buyback just spent plus 6.1% because you might remember if you have been following us that 2023 was really a record year also with a lot of one offs and again 24% this upline to deliver continued growth even on exceptional levels that I think before. 25% is going to be a more complicated year because we have some headwinds and those are the general headwinds of the automotive markets. But we will also see something specific to Italy and to the subsegment that we work with, which is obviously the subsegment of last week because that’s what rental business is about and everything business is about. You might know that food benefit tax treatment has change in ’25 and basically if you buy, if you get assigned as an employee a new car in ’25 and that car is a traditional car, I mean it’s not an electric vehicle or a plug in vehicle then your frame benefits, the frame benefits will be higher than if you will pay higher taxes.

And so this has but this is too much a new contract which means that there will probably be a hit on the new rental market and the new leasing market people will probably postpone. They are if their contract expires in ’twenty five, they might decide to postpone getting the new car. And that obviously will kind of impact us in terms of the business that we do because our business is also in managing the new contracts for the Italian company. So if there are smaller number of contracts, then obviously we will be impacted. We are focusing anyway of keeping the growth at the margin level like thanks to operational improvements and efficiency.

And then three last comments before I give it back to market to talk about these enterprises and the net finance acquisition. But basically, as we have already commented, we have the fund with the divestiture from Chantec Finance and Inti. Let me just say this was a healthy thing to do. Unfortunately, non banking financial institutions have got tough life in this market because funding is very volatile and therefore it’s very complicated if you don’t do this at scale to really run them as continuously profitable businesses. So in ’23, as you said, we had ’twenty two, ’twenty three was relatively very clear and ’twenty four, as Marco commented, we basically lost the EBITDA level a million.

And so we decided that the right thing to do was to buy that from this business. And we are disciplined enough to be able to do it by the March of twenty twenty five. Finally, in November, we got a small company which is specialized in providing services for consulting in the pension area. And as you know, we believe this will be an interesting segment because basically the baby boomers are now really getting closer to the moment they will retire. And the retirement is complex in Italy both in terms of the options that you have, understanding when you can really retire and what’s the best procedure, what’s the best combination of loyalty to retire.

So people are really in need of this service and we hope to be able to foster the growth of this business both in terms of B2C model, but especially on a B2B2C model using our normal science banks and insurance companies as a platform to see growth in the future. So that will also add to the growth in 2025. And with this, I am done talking about the BPO part and I give it back to Marco for the remaining part of the presentation. Thanks, Mark. Thank you, Alessandro.

And well, very quickly on the dividends, the proposal of the Board is to keep the same level of dividend of last year that is $0.12 per share. But that’s a quick comment. And then more interesting is the financial position. And here you see that our financial position is negative €320,000,000 as of 12/31/2024. And basically, this is the combination of many effects.

On one side, we had strong cash generation, both from the I mean, we can see this from the cash flow statement from the operating profitability of the business, but also we improved the working capital, especially keeping in mind that we increased the size of the business and the working capital didn’t change in a significant way despite this enhancement of the business. But then we used these resources both for the acquisition during the year, both the amount that we paid and the liabilities that we recognized for the puts and calls on the minorities of the acquisitions of 2024. But the most important negative effect or an equally important negative effect was the fact that over the year we had to redetermine the liabilities of existing options and in particular the biggest impact I mean, the really relevant impact was the one on Unalakary. We will provide the figures as usual in the full year report, but Unalakary, it’s the company does place, manages the multi flight lanes and we have to acquire during the course of ’twenty five, we have acquired a large minority of 49% and as usual, we have these push and calls that are linked to results and the company did very, very well in terms of revenues as Alexander explained and even better in terms of EBITDA, which is the parameter that is used for our calculation.

So it’s much better than the budget And we have a bigger business, but also we have to pay out more money. And this is now based on the results actually in 2024, this is now included in the put and call liabilities and therefore in the net financial position. Actually, this is within the current financial liabilities line, lining of the net financial position. But again, for the details, expect us to wait until we see the full report, but this is what affected our results. So that’s how we get to the $320,000,000 Then as you know our covenants with the banks also treat the money stake as cash equivalents.

So for the covenants, the net financial position is negative two eighteen. So this is, I would say, the comment on the net financial position and even on financial aspects, we are quite confident that with a good operating performance in expected to increase size, the financial position will improve significantly during the year. And with this, we are done with the presentation and we can open the floor to questions. So please, operator, go ahead.

Alessandro Fracassisio, CFO, Multiply Group: Excuse me, are you ready Thank you.

Conference Operator: This is the conference call operator. We will now begin the question and answer session. The first question is from Aleksandra Sohra, Equita. Please go ahead.

Alessandro Fracassisio, CFO, Multiply Group: Hi, good afternoon. Thank you for taking my questions. I feel free on my end. The first one is on mortgages. There’s maybe a little bit of color on the fourth quarter alone.

So you said definitely a recovery. I estimate actually a double digit year on year growth. So if you can confirm this and maybe if you can compare it to the general market trend in the mortgages in the fourth quarter and how much of this growth is refinancing and how much is new mortgages? Then the second one is maybe a follow-up on e commerce. If I remember correctly, over the third quarter, we saw both a recovery in revenues and operating margins there.

But then we are seeing again, let’s say, a slowdown in EBITDA and operating margins in the fourth quarter and maybe also in 2025. So you mentioned previously the acquisition cost of Google advertising. So maybe what seems between the third and the fourth quarter in the Google behavior? So just a little bit of color on this. And the third one is actually on some newspaper articles that were published over the weekend, again on some rumors that you are potentially closing a deal with the Persiben in Germany on VERIVOX.

So maybe if you can provide any color or comment on this. And then generally, what is your approach around 2025 on M and A? And what kind of targets you are looking at and maybe how you will treat your money for the market stake if you are still willing to keep it or maybe to sell it if an interesting opportunity emerges?

Conference Operator: Thank

Marco Pascarmona, Chairman, Multiply Group: you. Okay. Let’s see if I can remember everything, but let’s start from mortgages. I would say, yes, double digit is what we saw and I would say we are performing, I think, in both divisions in line or better than the market, thanks to, I would say, market share increases and so on. So I would normally look at what the market is doing and expect that to perform in line or a bit better.

And so far that’s been double digit and that applies both to purchase mortgages and to refinancing. You see a bigger impact of refinancings on BPO, by the way, because as Alejandro explained, basically the cost of the notaries that go into our revenues have, I would say maybe Alessandro for everything else but more than doubled or doubled something like that. And so Yes, I was saying, increased 75%, something like that. Okay, 75%, okay. So a big portion of our passcode in effect of our revenues we’ve been deployed increased by by 75%.

So that is amplified the impact. But in general, I mean both divisions should do in line or better than the math from what can currently see. Now e commerce, this is ups and downs and our comment is on the full year. And so we had better quarters, worse quarters. And actually, the first half of the year, we had got some of the work periods.

But it really is ups and downs. And I would look at the full year and the full year was down in terms of and they’re not commenting on the fourth quarter anymore in terms of EBITDA. And for 2025, for now we have we’ll take a conservative view because there is the stability things changing all the time and we have this big concern about non compliance, which of course is also an opportunity. Finally, there is a longer weighted regulatory intervention. And finally on the articles, we are talking about very well.

This is a topic on which we are not able to make any comment. In general, our approach to M and A is, I would say, opportunistic. So we would do acquisitions that are clear and with our strategy that would be acquisition of comparison intermediation businesses also internationally that have a good market position and that would fit our business portfolio. So because we have been successfully running the acquired businesses so far and improving their performance. So that would be part of our potential growth strategy.

The other part would be more acquisitions immediately for the BTO division of businesses in the same verticals where we are already present or in verticals that have similarities with what we are already doing. This will be our strategy. We can find acquisitions with bank financing. We have good relationships with a number of banks in Italy that would like to support us. Of course, if something is really sizable, then we would consider potentially selling the part of our money shares.

This is financial investment as you know. Obviously, the company is not trading at a very rich price. And so before selling it, as you know, we would really need to have something that is very, very competitive. But I would say we have enough flexibility to do many things with our own resources and ordinary impact tax.

Conference Operator: The next question is from Gianmarco Bonacino, Banca Acro. Please go ahead.

Alessandro Fracassisio, CFO, Multiply Group: Yes, good

Marco Pascarmona, Chairman, Multiply Group: afternoon. A few questions from my side. The first one, given your current visibility, you provided the clearly qualitative output, but can we say that the current market expectation for 2025 are a good summary of your qualitative outlooks on high single digit revenue growth and low double digit EBITDA growth can be considered as fair? That’s my first question. Yes, the second one is about the situation with DNA and Google.

Are you able to give us, let’s say, an outcome in terms of quantitative impact for you in case there would be a positive ruling or a range or just, let’s say, what could happen in your P and L? And the last one is, so recently, we saw some increase in mortgage rates. To what level, even though clearly they are still significantly down year over year, Which level do you see as a maximum under which you would then have again maybe some issues in terms of positive growth? Thank you. Okay.

Well, in terms of the outlook, I would say the outlook that you mentioned is a possible outlook. I mean it could be that or it could be, well it depends because we are starting the year with strength in a number of business lines, then we don’t know what will happen in the second half of the year. I think that’s meaningful outlook may be a bit conservative, but it really depends. It’s difficult to make any prediction. If we are able to continue at the current pace, maybe things could be better or if one just takes an average expectation that makes sense.

So I would say, stay tuned and we see we evolve in the coming quarter. And regarding the D and A, the key thing to understand is that the online comparison market, which is the market where Google Shopping and the Travelpayss operate is a very, very big market. This is very significant. And if this market is reopened, then the size of Tropicci could increase very significantly. But this would require for instance, if Google is prohibited for instance from showing Google Shopping in the search results page that could be very beneficial and that could be for instance a possible outcome of, it’s not for us to say what the commission will decide, but this is like a potential decision.

So if they decide that the current favoring cannot continue and until there is a different solution and there is a tradition to show Google Shopping within the results pages. This could be beneficial and certainly would restore fair treatment and certainly would result in significant growth of retrovatric revenue. But and also on this I would say that that side is quite significant, but it takes time and we have to see exactly how the enforcement will take place and this is in a situation where there are a lot of tensions and these discussions, what the commission does can be instrumentalizing trade off and so on. So there is probably a lot of caution everywhere. So we don’t know what will happen.

But potentially this is a significant upside. And finally, the increasing mortgage rates and maybe on this also Alessandro can help me, but it’s, I would say, we can withstand an increase of 31 percentage points in terms of long term interest rates. And it really depends on

Alessandro Fracassisio, CFO, Multiply Group: generally

Marco Pascarmona, Chairman, Multiply Group: the consumer confidence, inflation, what is happening to real estate prices and so on. So I would not expect small changes in interest rates to have a big impact this year. If there is a slowdown in the mortgage market, I think it’s more likely to come from consumer confidence rather than from interest rates. Okay, very clear. Thank you.

Conference Operator: The next question is from Gabriela Venturi, Banca, Accros. Please go ahead.

Marco Pascarmona, Chairman, Multiply Group: Good afternoon. You already answered my question. So I have enough to ask. Thank you.

Conference Operator: The next question is from Thomas Donieto, Kepler Cheuvreux. Please go ahead.

Thomas Donieto, Analyst, Kepler Cheuvreux: Hello. Thank you very much for taking my questions. I would have two on my side. The first one, I’m trying to understand the Mavic’s margin contraction. I mean, it is certainly driven by the e commerce price comparison and the slightly lower contribution from credit broking.

But do you have any other headwinds there? And how should we see margins next year? Yes. And on top of that, it would be also helpful to know if you can give us the organic growth of the year or better the contribution of the two new acquisitions, which went price wise? Thank you.

Marco Pascarmona, Chairman, Multiply Group: Okay. I would say, yes, the contraction of The Americas is attributable to credit broking and also to e commerce price comparison as you correctly pointed out. But it is also potentially mixed effect. I don’t have the exact breakdown, but you have some business lines that are growing faster than others. And it seems like e commerce by comparison is both seeing decreasing margins and adding a greater weight on the total.

I would say given the outlook that we have stated, basically, I think margins should be expected to be up year on year overall rather than in contracting because now we are seeing credit blocking doing better. And the other things that are growing also, I’d like to see margin expansion. So overall, I think you need to see quarter by quarter. I think that it’s more likely to have an outlook of improving margin based on what we said so far. And the acquisitions that we have made have, I mean, let’s say, how the two companies are doing.

Let’s start from the easiest, which is the Flicho that was kind of it’s not a startup but a fast growing company. And so we are seeing with Flicho significant organic growth. We have seen it in 2024. And whereas price wise is a more stable business in a more stable market. So we are improving a number of things, but the contribution is, I mean, the year on year, By the way, the previous year was a year of reopening of the market.

So there is some organic growth, but nothing sensational. In terms of what they contribute to the consolidation, we don’t disclose it. But again, again, one company is only for one quarter, the other for two quarters. So it’s, the EBITDA contribution is not so high and you can probably estimate it based on last year’s figures, if that’s what you are after. I don’t know if I answer your question or you meant something slightly different.

Thomas Donieto, Analyst, Kepler Cheuvreux: No, no, no, it’s perfect. And maybe if I can just follow-up on that question. On the cash flow generation that was very strong in the quarter and the year, I was just wondering if you think you would have more room for improving the working capital or you are just already at your best there?

Marco Pascarmona, Chairman, Multiply Group: I don’t know if we are already at our best, but we did a conscious effort in the second half of the year to improve the working capital and that’s especially on the receivable side, both in terms of the time it takes to collect invoices, but also the time it takes to issue invoices, which has to do also with reconciliation with our partners and so on. So I would say we have probably done most of the work. Maybe there is a little bit of extra improvement that could be visible going forward, but most of the records was probably already done.

Conference Operator: Gentlemen, there are no more questions registered at this time. I turn the conference back to you for any closing remarks.

Marco Pascarmona, Chairman, Multiply Group: Okay. Then we thank everybody for participating for our call. As always, we are available one on one for any follow ups. Thank you. Yes.

Thank you, everyone. Bye bye. Thank you. Bye.

Conference Operator: Ladies and gentlemen, thank you for joining. The conference is now over and you may disconnect your cell phones.

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