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Original-Research: Verve Group SE - from GBC AG

02.07.2025 / 11:30 CET/CEST

Dissemination of a Research, transmitted by EQS News - a service of EQ

Group.

The issuer is solely responsible for the content of this research. The

result of this research does not constitute investment advice or an

invitation to conclude certain stock exchange transactions.

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Classification of GBC AG to Verve Group SE

Company Name: Verve Group SE

ISIN: SE0018538068

Reason for the research: Research study (Anno)

Recommendation: BUY

Target price: 9.20 EUR

Last rating change:

Analyst: Marcel Goldmann, Cosmin Filker

Q1 closed with significant sales and operating earnings growth, share price

target raised after guidance concretisation

Thanks to strong organic growth, Verve Group closed the past 2024 financial

year with a significant increase in revenue of 35.7% to EUR 437.01 million

(PY: EUR 321.98 million), making it a record year. The dynamic growth of 46.0%

to EUR 144.2 million in the fourth quarter (Q4 2023: EUR 98.7 million) made a

particularly significant contribution to this. In addition to the organic

growth impetus, the Jun Group acquisition carried out in summer 2024 also

increased the pace of growth. At the same time, adjusted EBITDA increased

disproportionately by 40.0% to EUR 133.25 million (PY: EUR 95.17 million).

Verve also achieved a significant increase in revenue of 32.2% to EUR 109.04

million in the first quarter of the current financial year 2025 (Q1 2024: EUR

82.47 million). This was primarily fuelled by a significant increase in

large software customers (revenue > USD 100,000) by 51.0% to 1,152 (Q1 2024:

764). At the same time, adjusted EBITDA (Adj. EBITDA) increased

significantly by 37.3% to EUR 30.2 million (Q1 2024: EUR 22.0 million). The

adjusted EBITDA margin improved slightly to 27.7% at the end of the first

quarter (Q1 2024: 26.7%).

With the recent publication of its Q1 business figures, Verve's management

has concretised the previous rough company outlook (double-digit organic

growth) for the current financial year 2025. Accordingly, Verve now expect

sales revenues in a range of EUR 530.0 million to EUR 565.0 million and an

adjusted EBITDA of EUR 155.0 million to EUR 175.0 million for the current

financial year. Based on this, Verve Group is aiming for future sales of

over EUR 1.00 billion and an operating result

(EBITDA) of over EUR 330.0 million in 2028/2029. In line with its growth

ambitions, Verve recently announced its uplisting to the Geregelten Markt

(regulated market) of the Frankfurt Stock Exchange and is aiming to be

included in the prominent SDAX in the future.

In view of the more specific guidance, the confirmed medium-term outlook and

the positive Q1 performance, we have adjusted our previous estimate

upwards. For the current financial year 2025, we now expect sales of EUR

547.34 million (previously: EUR 502.11 million) and EBITDA of EUR 157.37 million

(previously: EUR 156.84 million). For the following years 2026 and 2027, we

are forecasting sales of EUR 652.42 million (previously: EUR 596.79 million) and

EUR 784.77 million (previously: EUR 716.74 million) respectively. At the same

time, EBITDA should increase to EUR 192.42 million (previously: EUR 191.58

million) or EUR 237.34 million (previously: EUR 236.16 million).

Thanks in particular to its strong positioning in the US core market

(especially in the mobile in-app and CTV sector) and with its innovative

ID-less advertising solutions as well as the increased expansion of it

marketing and sales staff, this ad tech company should be able to continue

its dynamic growth trajectory despite the current difficult environment. In

the course of this, Verve should also be able to capitalise on its highly

diversified customer portfolio with a predominant share of advertising

customers from defensive sectors (e.g. gaming/entertainment,

retail/e-commerce or social media/internet or consumer goods industries), a

customers from these sectors (share of Verve's total customer base GBCe:

>70.0%) traditionally keep their advertising budgets relatively stable even

across different economic cycles.

In addition, the mobile in-app and CTV advertising channels, in which Verve

is primarily active, have also proven to be significantly more robust in an

advertising market phase with a tendency towards „tighter“ customer budget

than alternative advertising formats, such as display advertising or web

advertising.

With regard to future Group profitability, Verve should be able to

increasingly benefit from the expected positive effects of the efficiency

and optimisation measures introduced (bundling and standardisation of

cloud-based platforms as part of platform integration, etc.) from the end of

the current financial year onwards.

Based on our increased sales and earnings estimates, we have also

significantly raised our previous price target to EUR 9.20 (previously: EUR

8.30) per share. The rollover effect (price target based on the 2026 fiscal

year instead of 2025 as previously) also contributed to the increase in the

price target. This was offset by the recent dilution effect resulting from

the capital increase and the shares issued as part of the employee stock

option program. In relation to the current share price level, we therefore

continue to assign a „BUY“ rating and see significant upside potential for

the Verve share. The share could receive an additional „boost“ from a

possible inclusion in the SDAX. We consider the probability of this ad tech

group being included in this prestigious index in the near future to be

relatively high.

You can download the research here: http://www.more-ir.de/d/32946.pdf

Contact for questions:

GBC AG

Halderstrasse 27

86150 Augsburg

0821 / 241133 0

research@gbc-ag.de

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Interessenkonflikte finden Sie unter: http://www.gbc-ag.de/de/Offenlegung

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Date (time) of completion: 02/07/2025 (9:55)

Date (time) of first distribution: 02/07/2025 (11:30)

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2164064 02.07.2025 CET/CEST

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