Enero, the parent company of creative agency BMF, the AdNews Agency of the year, is underrated, according to market analysts.
CEO Brent Scrimshaw describes Enero as a creative technology company with integrated marketing and adtech services combined with deep vertical and industry expertise. “We're creatively powered and we're technology enabled.”
The business units include BMF, Hotwire Group, digital and experiential agency Orchard and adtech platform OBMedia.
The creative agency part of the business, BMF, in explaining its strategy to investors in Enero, describes itself as the home of the long idea.
Steve McArdle, CEO, BMF, says this has been in place for eight years and refers to the enduring, highly effective brand platforms developed for clients
“The formula for building those ideas was developed using a blend of neuroscience, data science, marketing, science, and good old fashioned imagination,” he told an Enero investor briefing.
“We're uniquely positioned to win in an industry that continues to evolve at pace.”
Analysts at wealth managers Evans and Partners, in a note to its clients, have a positive view of Enero despite a “tough” year for its share price.
The shares are trading around $1.65, less than half Enero's year high.
Evans and Partners says there aren’t many stocks that have grown earnings per share by 26% compound between 2020 and 2023.
The analysts believe the macroeconomic environment impacting advertising agencies and Enero’s overweight exposure to technology and media industries could be part of the reason the share price is subdued.
The marketing, technology and communications group posted an almost 39% lift in revenue to $129.5 million in the half year to November. And net profit was up 8.1% to $14.8 million.
McArdle at BMF points to long term clients including ALDI, whose You Can't Overcook Christmas won the AdNews Ad Campaign of the Year - sponsored by Quantcast.
“We work with 30 clients on an ongoing basis, some with a portfolio of departments within them, like the federal government or a portfolio of brands like George Weston foods,” says McArdle.
“In a number of cases we benefit from many long standing retained relationships. For example, our two biggest clients here by revenue, ALDI and the Australian Federal Government, have both been with the agency for over 20 years and have recently signed three plus year extensions to those agreements.
“Our client portfolio is highly diversified and strong in high growth verticals such as retail, financial services, travel, and media.
“These are complemented by consumer staples and government which I mentioned before both but both federal and state government.
“More recently, we've also been successful in winning more progressive digital first and online marketplace brands such as Hipages in Australia.”
BMF, he says, builds enduring highly effective brand platforms for clients.
“The formula for building those ideas was developed using a blend of neuroscience data science, marketing, science, and good old fashioned imagination,” he says.
A slide from the investor presentation.
But he says the marketing world has changed and continues to change for his clients.
“There's no doubt there's been a seismic shift over time,” he says.
“Traditional paid campaigns that focus solely on channels like TV out of home and print no longer exist in isolation.”
As media fragmented and digital channels rose up, they were subsumed into fully integrated campaigns delivered across multiple channels.
Owned channels such as websites and social media platforms and earned media channels worked alongside paid.
“We've obviously been responding to and certainly leading the industry changes I've just spoken to you about,” says McArdle.
“We've done this by significantly evolving and in certain areas, transforming our capabilities way beyond the traditional core core skill sets that you see on the left hand side of this slide.
“This has helped us extend our remits and deepen our relationships with current clients and broaden our appeal to potential clients.”
A BMF slide from the investor presentation:
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