Muza SA: a cheap Polish publishing nanocap
According to Muza’s investors relation site their business is the following:
full range of publishing and printing activities,
production and reproduction of recorded information carriers,
trade and distribution, in particular of publishing, printing and other information carriers to the full extent,
advertising activities, organization of cultural, recreational and sports events,
organization of fairs and exhibitions,
running rehabilitation centers, sanatoriums and other medical institutions.
The company prints books for other publishers and buys rights to publish foreign books in Polish. The company also publishes newspapers, magazines and educational books.
Disclosure is in Polish. I depend on the readability and accuracy of software translations. Unfortunately I was not able to download any documents from the Polish exchange. That was in December 2022, probably because of a temporary technical problem at their website. I found the annual report here.
The stock is listed in Poland under ticker MZA. Currently the stock price is 6.0 PLN. For 6.0 PLN per share the market cap is 4.3 million USD, EV/EBIT is 4.1 and EV/Revenue is about 0.4.
Multi-year metrics for judging earnings quality and asset allocation are clearly better than average but still not extremely good.
After many years the company paid a dividend in 2021, partly offset by a smaller dilution. I have not found any other significant dilutions or repurchases during the last 5 years.
The balance sheet is strong with moderate leverage, a safe current ratio, enough cash and no debts. There is about 4 million PLN of cash (2022-09-30) and almost 10 million PLN of investment property (page 27 annual report). This is an almost 70% interest in a hotel.
Substantial shareholders: Margaret Czarzasty 25.01% (21.75% of the votes), the CEO Marcin Garlinski 15.74%, chairman of the supervisory board Stanislaw Stepien 11.67% (or Stanisÿaw Stÿpieÿ?), Adam Majdzik 6.70%, Grazyna Kaczmarek 1.34% (5.82% of the votes).
The only major shareholders that are also management or supervisory board members are the CEO and the chairman of the supervisory board. I think both Margaret Czarzasty (or Maÿgorzata Czarzasty?) and Marcin Garlinski (or Marcin Garliÿski?) increased their shareholdings in 2021.
I do not think there have been any significant related party transactions in 2021 apart from management compensation. I have not found information on management and supervisory board compensation.
Conclusion
Though I have not been able to download many documents I think this is a good nanocap stock to own, on a statistical basis. I like the low earnings multiples (EV/EBIT, P/E and EV/Revenue), the strong balance sheet, the better than average earnings quality/asset allocation and the shareholders structure. So far, the company has not paid out much to its shareholders but the 2 million PLN dividend payment (0.65 PLN per share) paid in 2021 gives me hope.
Disclosure: Long Muza SA.