Kino Polska TV S.A. - Reduction of PT from PLN 18.30 to PLN 14.90
Our new 12-months PT for KPL (70% DCF, 30% peer-group-based fair value) is PLN 14.90 vs. PLN 18.30 before. Our valuation reflects (1) the company’s guidance for 2016, which foresees revenues of PLN 115m and EBITDA of PLN 50m (2) a significantly higher share of depreciation expenses y-o-y in Q1/16 and (3) KPL’s PLN 10m investment in the new TV channel ZOOM.TV, which we expect to reach the break-even only in 2018E. We like KPL due to its sound strategy, which is based on making attractive proprietary content available on multiple platforms and international markets, as well as a cash generating business model, which allows payment of attractive dividends on a regular basis. Moreover, in our view Netflix, which launched its service in Poland at the beginning of 2016, does not constitute a significant threat for KPL for now as it has so far not been able to gain many users due to high prices (monthly fee in PL is the same as in Western Europe) and a lack of local content. ​
Kino Polska TV SA is a Poland-based media company. The Company's main activities include: television broadcasting and distribution, as well as publishing and television production. The Company operates five television channels: Kino Polska, FilmBox, FilmBox Extra, FilmBox HD and FilmBox Family. In addition, the Company produces and distributes stations of the FilmBox group in Poland, the Czech Republic, Slovakia, Romania and Hungary. The Company owns a publishing house Wydawnictwo Telewizji Kino Polska, which is engaged in the production of digital video discs (DVD) devoted to the Polish film. On May 28, 2014, subsequently to the merger with Oblio International BV, SPI International BV acquired 65.99% stake in the Company.
We are a leading, management-owned research boutique with a focus on companies from Emerging Europe. Our role is that of an intermediary between companies on the one hand and investors on the other. Our research products are directly distributed to more than 200 mutual and pension funds, family offices and independent asset managers from Central and Eastern Europe, the German-speaking region, Scandinavia, France and UK. In addition, we publish our reports on platforms such as Bloomberg, Thomson Reuters, Capital IQ and PAP, thus ensuring that they are available to institutions from around the world. By organising roadshows and conferences, we provide investors with direct access to corporate decision makers. Our team consists of professionals with long capital market experience in both Western Europe and the CEE region.
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