Enero pulls back the curtain on BMF

Sep 01, 2025

Welcome to the first Unmade edition of Spring.

Today: We learn the financial state of creative agency BMF, and its place within the slimmed down Enero portfolio.

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Enero makes the case for the sum of its parts

If you’re remotely interested in the business side of the media and marketing industry, one of the frustrations of results season is that after all that waiting, everything drops at once. That goes doubly so on the last day, when the stragglers rush out their results.

One that dropped on Friday which deserves an additional look was that of Enero. The company, which is now much smaller than it was, revealed EBITDA profits of $26m on a turnover of $168.3m

And that number was reduced to a profit of $14.1m on revenues of $138.7m, once OBMedia (which it sold on the last day of the financial year) was excluded from the total.

For, I think the first time, Australia’s only locally listed holdco revealed the performance of its three remaining agencies.

I’m all for the transparency. It’s not dissimilar to the way that Nine shared more information this time on the financial performance of its publishing arm. Or the decision of News Corp a few quarters back to start sharing its Australian advertising and circulation revenue.

As we discussed in the Mumbrellacast last month, I wondered whether the extra data from Nine is a signal to the market of a willingness to sell the division. Or at the very least a signal that the sum of the parts should be worth more.

Similarly, I wonder what is behind Enero’s extra openness.

Back when Enero was still known as Photon Group, it was a near-impenetrable rollup with dozens of agencies, and wider communications industry businesses. When the music stopped at the height of the Global Financial Crisis, Photon very nearly died.

Now, Hotwire, BMF and Orchard are all that’s left in the business.

The UK founded tech PR consultancy Hotwire was bought by Photon in 2007, with various other agencies folded into Hotwire over the last couple of decades.

BMF’s deal also came in 2007 for a price of $21.8m, back when that was a lot of money.

Orchard Marketing was purchased by the revamped Enero in 2018 for a headline price of $27m.

The BMF data is the most interesting aspect. Thanks to Enero’s new numbers we get a rare glimpse of the state of business for one of Australia’s bigger independent creative agencies.

Last year BMF’s revenue was $34.4m and its EBITDA profit was $6.9m

A key moment of the year was BMF winning Westpac from DDB back in February, which it characterises as the biggest win in the agency’s history.

The release also teases a further two BMF client wins which have not yet been announced.

Meanwhile, Hotwire was Enero’s star performer, with profits growing to $11.1m despite revenue declining by 4% to $78.6m. And Orchard delivered $4.9m in profits.

Perhaps the breakdown of the agency performances is to simply make the case that Enero’s value should be higher.

Enero now has a simple business model at a time when complexity is being marked down by the market. And, unusually for companies like this, Enero is free of net debt. It has net cash of $27.5m.

The share price is just a quarter of where it was four years ago. Unless you believe that AI will entirely kill the business model of agencies in a very short time frame, that boosts the argument that Enero is undervalued.

The current market capitalisation of $84m amounts to a multiple of a little over three times annual profits.

Declaration of interest: Through my self managed super fund, I invest in the ASX including stocks on the Unmade Index. This afternoon, I bought an additional $3,000 in Enero shares. Do not treat this as investment advice. I usually get such things wrong.

Broadcasters surge into Spring on the Unmade Index

The Nine pinball continued to rattle around on the Unmade Index, as analysts attempt to discern whether the company has a strategy after the sale of Domain. Today saw Nine’s share price rise by 5%.

It was a strong day for all the major broadcasters with Seven West Media gaining 7.1%, Southern Cross Austereo up by 6.3% and ARN Media up by 5.4%.

Meanwhile Vinyl Group had the worst of it, losing 5.1% while Enero lost 2%. Ooh Media fell back below a $900m market cap, losing 0.6% to land on $878m.