Deodato Gallery S.p.A. /25.01.2023

Ultima Ricerca Deodato Gallery S.p.A.

• UPDATE – 09.10.2024

  Deodato’s half-year results shows sales revenues of € 4.61 million in 1H24A, reflecting a slight decrease (-5.1%) compared to the figure recorded as of June 30th, 2023, which was € 4.85 million. EBITDA for the period ending June 30th, 2024, amounts to €0.40 million, down from €0.51 million in the first half of 2023, marking a decrease of 22.4%. The EBITDA margin for the first half of 2024 stands at 7.7%, lower than the 9.3% recorded in the same period of 2023. As of June 30th, 2024, EBIT, after depreciation and amortization of € 0.19 million, stands at € 0.21 million (€ 0.36 million in 1H23A), with an EBIT margin of 4.0%, compared to 6.6% in 1H23A. Net income amounts to € 0.17 million (€ 0.19 million in 1H24A). In light of the results published in the interim report for 1H24A, we are slightly adjusting our estimates for both the current year and the coming years. Specifically, we estimate a value of production of € 11.50 million for FY24E and an EBITDA of € 1.10 million, corresponding to a margin of 9.6%. For the subsequent years, we expect the production value to increase to € 15.20 million (CAGR 23A-26E: 10.2%) in FY26E, with an EBITDA of € 2.60 million (corresponding to a margin of 17.1%), growing from € 0.53 million in FY23A (corresponding to an EBITDA margin of 4.7%). Given the lack of comparable companies, we conducted the equity valuation of Deodato Arte based solely on the DCF methodology. The DCF method (which, in calculating the WACC, prudently includes a specific risk of 2.5%) yields an equity value of € 26,7 million. The target price is €0.85, with a BUY rating and MEDIUM risk.

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