The board of directors of Enlabs have adopted financial targets for 2021. Enlabs shall deliver EUR 20 million or more in EBITDA with earnings per share (EPS) increasing 40% or more annually through a combination of organic growth and acquisition. These financial targets are not a forecast, but rather an expression and clarification of the priorities our organisation actively works towards.
Value creating: Annual increase in EPS of 40% or more.
EPS (Earnings per share), calculated as net profit divided by total outstanding shares, is an immediate and clear measure of the company’s performance that can be attributed to the shareholders.
Profitability: EBITDA shall be EUR 20 million or more by 2021 with an EBITDA margin of 20 - 30%.
Enlabs considers profitability to be important even when showing growth, and EBITDA also provides an indication of operational cash flows.
Growth: 25% or more organic annual growth combined with well-considered acquisitions.
The target for organic growth is calculated on revenue compared to the previous period, except for any acquisitions.
Degree of financial leverage: Net debt / EBITDA shall not exceed a ratio of 1.5.
Enlabs seeks well considered acquisitions that can create synergies with the existing business. The size of any acquisition may vary depending on the situation, but the purchasing model shall be structured combining equity-based payment with liquid funds. If raising debt is necessary, the company will not exceed a leverage ratio of net debt / EBITDA of 1.5.
STRATEGIC TOOLS FOR CREATING VALUE
Concentration on regulated markets: Currently approximately 90% of Enlabss gaming revenue is derived from regulated markets, primarily in the Baltic countries, where the group holds local gaming licenses and pays gaming tax. Regulation brings sustainability and credibility for licensed actors. Enlabs has built up considerable understanding and know-how relating to operations run under strict regulation and has customized a profitable business model that includes the cost of gaming taxes.
New markets: Enlabs has a positive view of market regulation and sees this as a significant opportunity for growth with sustainable revenues. One example is Sweden, where Enlabs has already submitted a license application. Another example is the successful launch in the Lithuanian market. The global trend toward greater regulation of markets is viewed by the group as a future opportunity.
Proprietary technology: These last two years Enlabs has invested in developing a new technology platform, which supports all brands regardless of market as a tool for greater scalability. The launch in Lithuania demonstrates that the platform is fully developed and puts Enlabs in a strong position where the Group does not depend on external IT providers. Owning its own technology Enlabs has the prerequisites for maintaining stable margins.
Synergies within the company: Enlabs will continue to operate in three business segments – Brands, Media and Solutions (B2B). There are significant opportunities to share resources and uncover additional synergy effects between our three segments.