LONDON (ShareCast) - (Sharecast News) - Team Internet reported strong cash flow and shifts in segment profitability in a full-year trading update on Tuesday, as well as an extension to the deadline for a potential acquisition offer from private equity firm Verdane.
The AIM-traded firm said that for 2024, it expects to report revenue of $803m, a 4% decline from 2023.

Net revenue was projected at $188m, down 2%, while adjusted EBITDA was expected to be $92m, a 4% decrease.

Despite the declines, the company said it generated a record $95m in adjusted operating cash flow, reflecting strong capital efficiency.

It noted the restructure of its reporting segments, now categorising operations into domains, identity and software (DIS), comparison, and search.

The DIS segment grew revenue by 7% to $203m, with net revenue rising 9% and adjusted EBITDA increasing 46%, driven by efficiency gains and improved operational leverage.

It said the comparison segment saw a 43% revenue surge to $63m, with EBITDA nearly doubling to $17m, supported by an AI-driven platform and international expansion.

The search segment, however, faced headwinds, with revenue declining 11% to $537m and adjusted EBITDA dropping 24%, as the company prioritised long-term customer trust over volume growth.

Net debt rose to $97m as of 31 December, from $74m a year earlier, following share repurchases of $21m, dividend payments of $10m, and $32m in acquisition-related spending.

Team Internet said it expected to record a non-cash impairment charge related to its acquisition of Shinez IO, which was undergoing a business model shift to short-form video.

Legal action against the sellers of Shinez remained ongoing.

"We are reflecting on a year of significant developments for Team Internet," said chief executive officer Michael Riedl.

"Despite modest contractions in group revenue and EBITDA, we ended the year with record operating cash flow and the most balanced earnings composition in our history.

"This underscores the resilience and potential of our diversified business model."

Riedl said the company's DIS segment achieved above-market growth, while its Comparison segment showcased extraordinary results, driven by its "cutting-edge" AI-native platform.

"We are confident that our search division's transition into a more content-rich consumer experience will ultimately set up the division for sustainable long-term growth.

"Looking forward, we remain committed to delivering sustainable earnings growth and shareholder returns through disciplined capital allocation, including dividends and share buybacks.

"We are well-positioned to capitalise on growth opportunities across all segments."

Separately, Team Internet said it had extended the deadline for a possible acquisition offer from Verdane Fund Manager to 4 March.

The extension would allow for continued due diligence and negotiations.

A second potential bidder, TowerBrook Capital Partners, confirmed on 10 January that it did not intend to make an offer.

At 1032 GMT, shares in Team Internet Group were up 0.77% at 104.2p.

Reporting by Josh White for Sharecast.com.

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