#Nordic Camping: New record numbers for Swedish camping

The trend is distinct: Swedes like camping. A few days ago, industry organisation SCR Svensk Camping reported new record numbers.

Last year, Sweden’s camping grounds recorded some 15 million guest nights. That is an increase by one million over the last two years. The increase has been biggest in the regions of Gotland, Västmanland and Jönköping. SCR’s CEO Lars Isacson sees continuously high potential to grow, not the least among international guests: “We have noticed increase interest from visitors from the Netherlands in particular and I believe there  is a huge potential from that market. They want to live close to the Swedish nature.” Mr Isacson believes that on top of the nature, it is the high standard, good service and choice of activities that attract international guests.

Most of them stay in caravans, but the number of nights for mobile homes has increased by 45% since 2010. There is a steady interest from customers in all age groups. Those who chose a mobile home are not the ones that used to sleep in tents before. “No, you can say that a third are previous boat owners, another third has sold their summer house and the other third have always been mobile home owners” says Tomas Haglund who is Chairman of the Swedish Caravan organisation. There is an increased demand for convenience and security and the vehicles have become larger. That also increased the requirements for camping grounds in terms of space and surface. Tomas Haglund states that it is important to be able to host the guest that are showing up and that both the number of caravans and mobile homes are increasing as well.

A company that is adapting to these changing needs of campers is Sweden’s leading camping operator Nordic Camping. At the moment, Nordic Camping is investing some SEK 4,5m in the project “Campsite Stockholm”. It is located south of Stockholm and will offer space for 23 smaller vehicles and 25 larger ones. The price for a standard lot is SEK 180/day, which includes drainage of sewage and garbage. Fresh water, and internet connection are also included. “Campsite Stockholm” is expected to open in time for Swedish midsummer, at the end of June.

As we reported a few days ago, Nordic Camping is one of the very few publicly listed options remaining to benefit from the increasing camping market around Europe. Only a few weeks ago, French camping operator Homair has been taken private by its majority shareholder Carlyle, who seems to be interested to consolidate the European camping market.

Nordic Investor

#Nordic Camping: French peer #Homair taken private by Carlyle

There have never been many options for investors to invest in publicly listed camping operators. As of recently, there is one option less.

French company Homair Vacances has been delisted from the Alternext market of Euronext Paris in February 2015, via a public tender offer followed by a squeeze-out for all shares at a price of EUR 8,70 per share. During the summer of 2014,Iliade sold a majority stake to the Carlyle Group.

We delivered a very successful and profitable growth under the ownership of Montefiore since 2006, and we believe Carlyle’s support would facilitate our growth and value creation plans for the coming years,” Alain Calmé, the Homair chairman, said in a statement in 2014.

Financial terms of the stake purchase were never disclosed. Just a few days before the Carlyle deal, Homair had agreed to acquire Eurocamp, a British outdoor holiday rental operator.

Eurocamp and Homair combined, manage about 15,000 mobile homes at about 300 campsites, primarily in France, Spain, Italy and Croatia. The Company has leveraged its French and British customer base to expand its holiday parks offer in major European countries (France, Italy, Spain, Croatia, Portugal, the Netherlands ans Austria). It sells holidays in France, in France, in the United Kingdom, in Belgium, in the Netherlands, in Germany, in Denmark, in Italy, in Ireland and in Spain.

In early 2015, Homair reported FY 2014 revenues of EUR 178,2m (including pro-forma numbers for Eurocamp) and an EBITDA of EUR 39,9m, implying an EBITDA margin of 22,4%. At the end of its FY 2014, Homair had a net debt of EUR 148,5m.

The squeeze out price of EUR 8,70 per share implied a market cap of EUR 99,2m for Homair Vacances and an Enterprise Value (EV) of EUR 247,7m. This implies a valuation of EV/EBITDA 6,2x for Homair, using 2014 numbers.

One of the few remaining publicly listed camping operators is Nordic Camping. Nordic Camping is listed in Sweden and is operating currently 14 camping sites and resorts at locations all over Sweden. The company has a strong track record of growing organically and actively consolidating the Swedish camping market. In 2014, Nordic Camping reported revenues of SEK 78m, an EBITDA of SEK 18,8m and a net profit of SEK 9,2m or SEK 1,09 per share. Growth has been strong over recent years and the company managed to beat its organic growth target of 10% p.a.. Nordic Camping is not short of innovative ideas either.

Since last year, the company has a cooperation with the Swedish Migration Board, offering temporary housing for asylum seekers during the off-season at several of its camping sites. Nordic Camping boasts a strong balance sheet (net debt / equity ratio of 55% at the end of 2014) leaving ample room for further expansion. Management is outspoken about its ambition to continue to acquire new camping sites and to expand existing ones. There have also been tremendous improvements in the area of IT over recent years, and we believe that Nordic Camping has probably the most efficient operations on the Swedish camping market, which is still very fragmented.

Nordic Camping’s share is currently trading at around SEK 23,5, implying a market cap of SEK 199m and an Enterprise Value of SEK 232,8m. Looking at FY2014 figures the implied valuation is an EV/EBITDA multiple of 12,4x. 

The big difference between Homair and Nordic Camping is size and growth rate. Homair is the biggest player in France and the UK with revenues of around EUR 180m, its growth rate is below 5% p.a.. Nordic Camping has revenues of around EUR 8,4m (at current FX rates) but is growing at high pace. Over the last three years, sales have expanded by 32,6%, 33% and 16% respectively. We believe that changes are high that toppling growth 2015 will be at least around 15%.

Conclusion: Investors interested in a rather non-cyclical growth story with real estate assets currently booked at purchase cost value (i.e. large revaluation potential once IFRS accounting standards will be applied) and significant consolidation potential in the industry, should have a close look at Nordic Camping. Being a leader in its market, the company seems well-positioned to continue its growth track.  It will be interesting to see what the “end game” will look like for the camping industry in terms of consolidation. Carlyle is an owner with large fire power and it is probably not completely unrealistic that they are interested to expand Homair’s reach further, once Eurocamp has been integrated successfully. By then Nordic Camping has probably grown in size additionally and might present an interesting target.

Nordic Investor

#Mobile gaming: Size matters $KING, #G5

Interesting article on www.cnbc.com on mobile gaming:

Make a mobile game that climbs near the top of the charts, and the dollars start flowing. In a big way.

For proof, look no further than the booming business that’s fueling casual game developer SGN. The maker of such titles as “Cookie Jam” and “Panda Pop” is poised to almost triple revenue this year to about $280 million from $100 million in 2014, according to Josh Yguado, president and co-founder of the Los Angeles-based company.  Critical to a breakout mobile game is having tens of millions of users download the app and play all they want for free, with a small percentage of fanatics paying for advanced features or to skip levels.

The 10 percent of paying SGN users are producing pretax profit margins for the company in the neighborhood of 20 percent, at a time when scores of heavily funded tech start-ups are burning millions every month for growth.

But just like hit-makers in other industries, the eternal challenge is staying power. In today’s world it requires creating multiple hits that become top 20 grossing games on iOS and Android.

Zynga was pummeled as gamers shifted from desktops to smartphones and has yet to recover despite a renewed focus on mobile. King.com, creator of the massively popular “Candy Crush” franchise, is trading below its IPO price from a year ago even though the company has produced successful follow-up games “Farm Heroes” and “Pet Rescue.”

SGN is steering clear of public markets for now and focusing instead on creating an arsenal of popular titles. “The market doesn’t seem to like casual game developers right now,” said Yguado, who previously worked at Fox and MTV. “We want a big enough portfolio so that there are no ups and downs or surprises.”

But the market is plenty big. In October, research firm Newzoo projected 2015 mobile game sales would climb 21 percent to $30.3 billion, overtaking console games as the leading segment. 

Yguado started SGN, in its existing form, in 2010 with MySpace co-founder Chris DeWolfe. By current market standards, the company has reached scale on very little capital, raising a little more than $25 million way back in 2010.

SGN’s big winner to date has been matching puzzle game “Cookie Jam,” which as of Friday ranked 21st on the iPhone among top-grossing games, 13th on the iPad and 14th on Google Play, and was named Facebook’s game of the year in 2014. “Panda Pop” is adding to the mix, ranking 32nd on Google and 47th on the iPhone.

But it’s the recently launched “Juice Jam” that Yguado is convinced will be the next smash hit. In its early days, the fruit juice-themed puzzle game is showing characteristics in terms of engagement and revenue that resemble “Cookie Jam.” Growth is strong enough that “Cookie Jam” will account for less than half of total revenue this year, Yguado said. “Once you create an established user base and a method for creating a successful game, it’s very replicable,” he said.

Sweden is not only home to Candy Crush maker King (listed in the US), but also G5 Entertainment (listed on Nasdaq OMX Small Cap). The casual game maker has been struggling with the transition from unlockable games towards a more Free-to-play dominated portfolio but seems to have managed the transition going into 2015. The big question mark remains behind the company’s ability to deliver profitability in-line with the “big guys”. In its most recent Q4 2014 report, G5 reported and adjusted EBIT margin of 5%, which compares to the King’s 36%.

Mobile gaming has become a matter of size. The big players can easily shed the case on user acquisition and still keep a high profitability. King, as an example, has three games among the top 10 grossing iPhone market in the US (the single most important market in the world). It is there where the serious cash is made. Simply spending money on user acquisition to keep your game among the top 100 grossing might deliver impressive topline growth (after all, the overall market for mobile gaming is still growing impressively), but the costs are eating up your bottom-line. Also, we believe there is little to no loyalty within the mobile gaming audience, meaning that once you stop spending on user acquisition, the player moves on to the next big thing that gets promoted everywhere.

We believe King is in an unique prime position and its strong balance sheet enables it to both grow organically but also by simply buying successful other franchises. Also, it’s valuation stands out as a bargain. Having just paid a dividend of around 6%, the share is trading at a 2015 PE-ratio of below 9%. 

Nordic Investor

#Berlin4: 100% Berlin

Morgan Stanley (MS) recently published an update on the German Residential Property Sector.

MS comes to the conclusion that Berlin has the strongest rental growth in Germany. Berlin’s new lettings rent were up 9% last year, followed by Stuttgart with 5% and Munich at 4%. Berlin’s rental levels remain relatively low at EUR 8,65 compared to Stuttgart’s average at EUR 11,50 and Munich at EUR 15,55, according to the investment bank. Other strong cities in Germany showed rental growth of up to 3%, with the German average at about 1%. MS says that JLL’s German residential valuation practice expects an 8-10% uplift in Berlin’s “Mietspiegel”, the local government’s estimate for in-place rent, when it is published in May.

MS continues in its report, saying that Berlin’s transaction yields range from 4% for top city centre product to 6,7% for standard buildings built in the 1950s to 1970s. Refurbished prefab in East Berlin is said to now transact at 5-5,5% yields.

JLL believes, that the largest cities in Germany have a gap between housing demand and supply. Berlin has had housing demand for about 20 000 new residential units per year, mainly driven by positive net migration of about 40 000 people per year, while only 3 000 – 4 000 apartments were built. Some local city governments are starting to take some initiatives to kick-start construction volumes. An example is Munich authorities selling land to house builders below market value in exchange for lower sales prices.

Morgan Stanley concludes its report by saying that fundamentals in the German residential market remain  strong and that Berlin stands out as a particularly strong market. Therefore, MS ranks “Deutsche Wohnen” at “Overweight”, which has a 70% exposure to Berlin and whose portfolio is still valued at a relatively high 6,5% despite much tighter transaction yields.

For investors looking at the Nordic equity markets, we have an even better idea: Berlin IV (www.berlin4.dk) listed in Denmark. As the name already suggest: Berlin IV gives investors 100% exposure towards the Berlin residential market. To be precise, Berlin IV owns and operates a portfolio of 135 properties with a total of approximately 2,737 residential and commercial leases located in Berlin. Berlin IV shares have since 2007 been listed on NASDAQ OMX Copenhagen. The strategy is to optimize operations and leverage the properties in order to improve the value of the portfolio and the company’s profit.

We like the following recent developments:

  • On February 2nd 2015, Berlin IV announced that it has refinanced EUR 127.5m (ca 85% of group loans), exploiting the current attractive interest rates. The initial impact on the company’s free cash flow will be around EUR 5m p.a..
  • Management stated that the improved cash flow will be used to pay dividends and/or buy back shares.
  • There has been aggressive insider buying following the announcement at 7 different occasions between end of February and end of March 2015.

Nordic Investor

#Ferratum: Interesting play on #mobile #banking growth

The number of UK mobile banking users is set to almost double from 17.8 million to 32.6 million by 2020, a recent research argues.

According to a recent report titled “Future Trends in UK Banking”, commissioned by Fiserv and compiled by the Centre for Economics and Business Research, money transfers via digital channels are forecast to grow to GBP 3.4 billion a week via mobile banking apps and GBP 9.4 billion a week via online banking, totalling GBP 12.8 billion a week over the same period.

Currently, just over a third (34%) of UK adults are estimated to be banking on their mobile. With the increasingly widespread ownership of smartphones and a growing appetite amongst UK adults to access their finances on-the-go, this figure is expected to almost double to 60% by 2020. This projected increase of 14.8 million more mobile banking users over the next half-decade represents a significant opportunity for challenger banks, Fiserv claims, to bring innovative business models to the market and for existing banks to add digital services to cater to this future majority.

The study adds that with the emergence of more high-tech features such as remote cheque capture and apps such as PayM, a wide range of mobile banking functions like checking your balance or conducting transfers are all expected to grow in popularity over the next five years. The total value of transactions being moved through mobile banking apps is expected to double by 2020 to GBP 3.4 billion a week.

Investors interested to benefit from this trend might want to have a look at Ferratum Group (www.ferratumgroup.com), listed in Germany since early 2015. The FinTech company is an international provider of mobile consumer loans and has a long track record in mobile banking services. Ferratum is based in Finland and was one of the first companies to provide loans via the internet and mobile phones when it started operations in 2005. Today, the company operates in more than 20 countries across Europe, the Asia-Pacific region and Canada. One of its subsidiaries, Erratum Bank Ltd, is a licensed credit institution with a banking licence in Malta which is used via cross-border provision of services in several EU member states.


Nordic Investor

#TrustBuddy: GVK introduces Credit Passport

TrustBuddy’s highly successful SME P2P lending provider Geldvoorelkaar (GVK) has started a cooperation with “Credit Passport“, the online tool for entrepreneurs in need of financing. With Credit Passport, the quality of the loan applications can be improved significantly, leading to more successful financing rounds via GVK.

GVK receives hundreds of loan applications every month. Out of these applications, 60% are not even passing the first step, simply because the application is incomplete. Out of those applications that are complete and are actually evaluated by GVK, more than 50% do not meed GVK’s requirements.

Says GVK’s CEO Martijn van Schelven: “What we find is that many of the applications are already dismissed at an early stage, because the plan is not well-developed or is incomplete. This is partly due to a lack of knowledge of the applicants. They often do not know what information is relevant to a funding request.”

The added value of Credit Passport in a funding request for GVK is the objective information provided by the Credit Passport about the entrepreneur and his business. Information on the financial solvency of a company is usually easily available, but information about the “soft side” of the entrepreneur is less available. Credit Passport offers various tests which evaluate the business profile and attitude of the entrepreneur. It also gives a picture of how the entrepreneur actually  runs his company. How does he, for example, deal with innovation and human resources? By adding such information to the business plan, an overall picture of the entrepreneur emerges. GVK can then make a more informed decision.

In order to support entrepreneurs in making a funding application that is ready to be placed on GVK crowdfunding platform, Credit Passport will be used in the early stages of the application process. Going forward, GVK will together with its affiliated accountants and advisors, undergo an intense SME credit coach training with the help of Credit Passport. In the future, once a project is posted on GVK’s website, the results of the Credit Passport test will be visible on the dashboard.

We see this new cooperation as yet another sign that GVK is at the forefront of SME P2P lending in Europe. The company is the largest player of its kind by loans funded and is enjoying strong demand by both companies in need of financing and investors who want a decent return on their investment. Over the last days, GVK had projects ranging between EUR 150k – EUR 300k that were filled within the same day of their release.

We eagerly await the launch of TrustBuddy’s Nordic SME P2P lending product www.crowdfundingsociety.com. With GVK’s experience and an abundance of interesting SMEs in the region, we believe changes are high that Crowdfunding Society will become a success.

Nordic Investor

#Altfi analysis underlines #TrustBuddy’s pole-position

www.altfi.com has published an interesting analysis of the P2P volumes development in the UK and Europe. The analysis offers, amongst others, interesting insight about our top-pick TrustBuddy.

The trend is clear: Globally, peer to peer and marketplace lending is growing rapidly. AltFi Data tracks origination volume in the UK and also the rest of Europe mapping the growth of the industry and the platforms that are leading a new wave of innovation in financial services.

The UK Industry started in early to mid 2005 whilst the first platform did not open for business elsewhere in Europe until mid 2007 (Auxmoney in Germany). The UK industry has broadly kept this 2.25yr headstart, and to date boasts a cumulative volume of GBP 3,220m versus Europe’s GBP 577m.

In absolute terms, the UK peer to peer lending industry is much further ahead of the rest of Europe with over 5.5 times the volume transacted. Growth in the UK has been more rapid in recent years too – between 2012 and 2014 the UK industry saw a seven fold increase in volume compared to a five fold increase in Europe.

Whilst the volume levels for the rest of Europe have been increasing impressively since 2012, origination in 2014 represented little over 16% of that of the UK. The graph below charts the UK vs European industry growth, plotting origination volume against years since industry inception in the respective geographies. The origination volumes of the UK and the European industries track each other surprisingly closely in the early years with Europe beginning to deviate away from the UK path recently. Perhaps as a result of the larger potential market size within Europe compared to the UK or today’s increased awareness of alternative finance globally.

Between years 7 and 9 in the UK industry, it can be seen in the chart below that the industry really began to take off. If the industry in the rest of Europe follows that same pattern, we may be about to see some explosive growth.


Growth Rates

The peer to peer lending industry grew rapidly both in the UK and the rest of Europe, with the UK recording higher growth rates consistently since 2012. As discussed below, the UK has seen more innovation and has a more diverse set of platforms. This is one reason why the UK industry has grown faster and continues to do so. Innovation and product diversity is beginning to increase in Europe, however, and it will be interesting to track whether this translates into an increased rate of growth.


Technology, regulation and government support are all key ingredients for the success of this a new era of digital finance. Whilst we can assume similar accessibility to technology across peer to peer platform geographies, regulatory and government support has varied. Perhaps this is the reason why the UK has industry has grown faster than the rest of Europe?

A number of UK government initiatives and legislative changes have provided support to the UK Alternative Finance industry. For example, the British Business Bank, a UK government led enterprise, is working with the industry to increase the supply of credit to SMEs as well as providing business advice. Peer to Peer ISA inclusion in the UK is planned and, although exact details have yet to be revealed following a consultation period, the proposal will undoubtedly bring a wall of investor money to the industry. Moreover, George Osborne, Chancellor of the Exchequer, announced in his 2014 autumn statement a new type of tax relief allowing retail investors to offset any losses incurred through bad debt against other P2P income.

Platforms in the UK are also FCA regulated, a boost for consumer confidence in this nascent industry. The enthusiastic state support for the UK’s industry, combined with proactive and supportive regulation, is providing investors and borrowers with the assurance of the longevity of alternative finance, promoting phenomenal growth.


Comparing the sector compositions of the UK industry vs the rest of Europe, its clear that business lending forms a much greater portion of the UK industry. This could be a function of the early stage of the European industry as the UK industry was much heavier weighted towards consumer lending in its early years. However, the US industry which is arguably the most developed in the world, is still made up of majority consumer lending.

Platform Dispersion


AltFi Data tracks market share in both the UK and wider European peer to peer markets. The charts above illustrate the market share of the top 5 platforms in 2014 for both markets. The top 5 UK platforms represent 75% of the market collectively whilst in the rest of Europe this figure is much higher at almost 85%. This indicates a lack of competition in the European industry, particularly when one considers that the majority of platforms only operate in one country.

We note that TrustBuddy is by far the biggest European P2P provider with a market share of 28% in 2014. Combined with its Dutch SME business Geldvoorelkaar (GVK), the market share is even 36%. Looking at the development of the sector composition above, we also note that P2P Business lending has gone from 6% of the overall P2P market in 2013 to 17% in 2014, i.e. showing very strong momentum. The 17% in Europe can be compared to the 47% in the UK.  We see no reason why P2P Business lending would not gain a similar importance in Europe as in the UK. TrustBuddy’s GVK operations are the leading P2P Business lending provider in Europe and TrustBuddy is about to launch its P2P Business concept also in the Nordics in the near future. At www.crowdfundingsociety.com interested investors and companies can already apply an be among the first to participate.

All in all, it seems rather difficult to find a company that is better positioned than Trustbuddy, to benefit from the ongoing trends within P2P lending in Europe.

Nordic Investor

#TrustBuddy: COB buys more shares

Simon Nathanson, Chairman of the Board at TrustBuddy, has bought an additional 55 000 shares in the company. This is the second transaction by Mr Nathanson within a week.

It appears as if Mr Nathanson is taking a prudent approach of spreading out his purchases over several different occasions and we would not be surprised to see Mr Nathanson making additional transactions in the near future.

Nordic Investor

#TrustBuddy: GVK reaches next milestone

Geldvoorelkaar (GVK), the Dutch success story recently acquired by TrustBuddy, has reached its next milestone today. Since its inception, the SME P2P lending provider has now mediated loans worth more than EUR 55m.

GVK April8

Two of the recently funded projects by GVK were WakaWaka (EUR 500.000 at 6% interest p.a.) and K.J. Wakker Holding (EUR 375.000 at 8% interest p.a.), both of which were filled in a matter of days despite their substantial size. This is yet another sign of how high the demand for alternative investments with sensible yield is.

We believe momentum will continue to be positive in the Dutch P2P lending market. The Dutch government recently decided to move the maximum cap for money to be invested in crowdfunding campaigns (including P2P lending). Not to forget, GVK has already started to explore an expansion into the Belgian market and TrustBuddy announced last week that it will start its SME lending operations in the Nordics under the brand “Crowdfunding Society”. As we could report last week, founder and major shareholder Jens Glasö participated recently at a P2P conference and stated in a panel discussion that the SME product would be launched in Sweden on April 8th. An official statement regarding the exact timing of the launch was never made and here tonight we know that the launch did not take place on April 8th. Nevertheless, we believe that the launch is imminent and interested lenders can already sign up at www.crowdfundingsociety.com.

 Nordic Investor



#G5 Entertainment: Strong preliminary Q1 numbers

As we have come to expect, mobile gaming developer and publisher G5 Entertainment has published its preliminary Q1 revenue number today, beating our expectations.

G5 management forecasts quarterly revenue of approximately SEK 96m (according to the new accounting practice), which corresponds to achieving 72% revenue growth versus Q1 2014. As of Q1 2015, G5 is reporting revenue including application store commissions, which may represent up to 30% of end user price.

The company will report its Q1 2015 report on May 8th, 2015.

Nordic Investor

Investing up North

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