Digitalbox PLC (AIM:DBOX) may have faced a tough crowd in its last financial year, but the owner of Entertainment Daily, The Daily Mash, The Tab and The Poke impressed analysts with its resilience against multiple industry headwinds.
The company experienced a 22% decline in revenues in 2023, affected significantly by platform activity changes from Facebook parent Meta and Google.
But Digitalbox still traded profitably, with a net cash balance of £1.67 million at the end of December, with £193,000 generated from operations.
Panmure attributed this to intelligent M&A, including the acquisition of POKE in late-2022, “which has already repaid 50% of its purchase costs”.
Similarly, The Tab and TVGuide have shown robust performance, with TVGuide being integrated and turned profitable shortly after its acquisition in late 2023.
“2023 was an incredibly tough year in online B2C media,” said Panmure’s Johnathan Barrett. “The macro weakness combined with platform volatility impacted publishers hard.”
But DigtalBox “didn’t take it lying down, it adapted to the platform hit via expansion of the social follower base and drove session values. This resulted in delivering a modest profit and the business has seen a marked improvement in activity”.
“Digitalbox is on track to rebuild profitability, and we see this as a catalyst to support the share price,” said Barrett.
Panmure has a target price of 7.6p on the stock, against a 3.86p publication price.