Web Site : http://www.dorimedia.com


Dori Media Group (DMG) is active in the international television market, specializing in the various business aspects of the Telenovela genre. The Group's business model focuses on a number of distinct but complementary businesses, each generating income independently: producing and distributing Telenovela; operating television channels; and selling related merchandise, thus creating a synergistic business group.


Broker Forecasts : DS

2007 EPS = 15.3p
2008 EPS = 22.13p


Major Shareholders (Shares in issue 20,403,727) :

Mapal Eden Telenobles Ltd. 7,770,161 (38.08%)
Miella Venture Partners inc. 4,261,303 (20.88%)
Mr. Yair Dori 3,245,000 (15.90%)
B.F Holdings GmbH 970,000 (4.75%)

Daniel Stewart comment today :

Dori Media - BUY

Price: 151p Target price: 278p Code: DMG.L Analyst: James Hollins | 020 7776 6571

Trading ahead of expectations

Dori Media has announced that its FY07 results (to 31 December) will be c.10% ahead of expectations.

The outperformance in FY07was principally based on a strong surge in revenue at the end of the year following a hugely successful Cannes MIPCOM festival ($6.3m and $9.9m actual/potential total sales) and the launch of its latest in-house Telenovela production, LaLola.

LaLola has now been sold into 24 countries globally in less than six months. This is an outstanding performance and provides positive immediate upside, as well as longer-term secondary and high margin revenue generation.

Elsewhere, the group has expanded its production capabilities (acquisition of studios in Argentina announced October 2007), securing in-house production time and driving revenue from leasing of one of the three studios.

Critically, the group has also today stated that the start-up of its HOT contract (estimated annual revenues of $20m over three years) has been very promising, underpinning our FY08E forecasts.

With the company very confident about the groups prospects for 2008 we see forecast risk very much on the upside and expect to raise numbers at the time of its prelims on 21 February 2008.

Based on a 10% outperformance of our FY07E estimates, the group is trading at just 9.7x FY07E earnings and 8.2x FY08E.

This rating significantly undervalues the groups base of TV production, broadcasting and distribution operations, with a strong, niche and fast growing position in the global Telenovela and broader TV industry.

We retain our Buy recommendation with 84% upside to our unchanged 278p price target.

Fantastic results, with huge growth coming in the next two years. I don't normally post recommendations to buy or hyperbole about companies but this company is flying in a very very secure market. The deal with SOny is particularly exciting, and they have m managed all the growth without diminishing margins.

Nice set of results :)

Daniel Stewart comment today :


Dori Media - BUY

Price: 159p Target price: 343p Code: DMG.L Analyst: James Hollins | 020 7776 6571


FY results; forecasts & target upgrades

Dori Media is our key pick in the media sector. The company has reported FY07A results c.19% ahead of our expectations.

We are upgrading our FY08E estimate by 13% and introducing a FY09E forecast of 51.5c (+24% vs FY08E).

We apply a 13x target multiple to FY09E EPS (343p target, 116% upside) and reiterate our Buy stance.

Doris FY07A results reflect top-line growth of 47.1% ($30.0m vs $20.4m), with solid increases across all divisions.

The largest division by revenue, TV series rights sales (+71% YoY, c.60% of group sales), benefited from strong recurring revenue, as well as substantial growth from new additional content, including Lalola.

Group gross margin increased from 73.4% in FY06A to 73.7% in FY07A (vs 69.0% forecast) with lower-than-expected content acquisition costs.

The group reported EPS of 33.8c, equating to 19.3% out performance against our 28.41c forecast and representing YoY earnings growth of 25.4%.

Following the FY07A results, and given our bullish outlook, we are upgrading FY08E PBT from $11.1m to $12.5m (+12.4%), with a resulting (unchanged tax rate of 21.0%) increase in earnings of 12.6%, from 36.97c to 41.62c.

We are introducing a forecast for FY09E, showing top-line growth of 35.2% to $82.5m, with earnings growth of 23.8% to 51.51c.

The resulting FY08E and FY09E multiples of 7.5x and 6.0x fail to reflect the strength of the business.

We believe that the company deserves a genuine growth multiple and premium to the UK television production sub-sector.

Doris growth potential and existing position in the global Telenovela industry, in our opinion, justify a target of 13x FY09E earnings. On this basis, we apply a target price of 343p.

The value of the cash generative nature of the business is borne out in our DCF-based valuation that drives our bull-case valuation of 405p.