Egm x-rayed: Deodato.Gallery reports 14.4 % ebitda increase

Thus the company managed to raise ebitda by 14.4% to EUR 607,000, but more importantly, thanks to depreciation and amortisation falling from EUR 391,000 to EUR 364,000, ebit jumped 74% to EUR 244,000 and net profit from only EUR 21,000 to EUR 110,000.

As of 31/12/2024 Deodato.Gallery showed a net financial debt of EUR 1.4 million, down from EUR 1.5 million at the end of 2023 thanks to an operating cash flow of EUR 1.2 million, partly absorbed by investments (especially in technology) of EUR 152,000, an increase in net working capital from EUR 4.3 million to EUR 4.9 million, and the purchase of tax bonuses (those for 2024 were used within the first half of 2024, while those for 2025, amounting to EUR 550,000, will be used in the current year). The tax ratio decreased from 88.6 per cent to 16.4 per cent. At the end of 2024, the Debt/Equity ratio amounted to 0.29 times, thus at very low levels.

Deodato.Gallery in 2024 issued a EUR 1 million convertible bond (fixed rate of 5%, therefore with an annual coupon of EUR 50,000), maturing in April 2029, underwritten in equal shares by investors Paolo Vantellini and Marco Patuano through MP Invest Srl (both well-known managers in the It and Tlc fields), the conversion of which may take place in the first half of February 2028 - 2029 and August 2027 - 2028 at the fixed price of EUR 0.5 per new share. The stock is currently trading at just over EUR 0.3 per share, but, as mentioned above, the conversion windows are not immediate.

For 2025, the company aims to further expand its range of services by launching "art leasing" for companies, advisory services for investments in art and education through workshops and master classes dedicated to art. It is worth mentioning that in 2024, according to the above-mentioned report by Art Basel and Ubs, on average 15% of High-Net-Worth Individuals have allocated 15% of their assets to art. These are people with a net worth of between $1 and $5 million, therefore high but not so rare even in our country.

And since, unfortunately, taxation on investment in works of art is unfavourable in Italy compared to other countries (so much so that even Assonime drew up a Position Paper in 2024 entitled 'Proposals for a more competitive taxation of art'), Deodato.Gallery aims to optimise its sales structure in countries with less penalising taxation (especially in Europe) and to expand its support for foreign customers. At the beginning of December 2024, the gallery in St. Moritz was reopened and, thanks to a partnership with The Great Living Estate, works of art are also presented in its showroom, which also houses design objects, haute couture garments and excellent food and wine. In March 2025, Deodato.Gallery participated in the important Affordable Art Fair New York, which presents original artworks with unit prices ranging from $100 to $12,000.

In the meantime, the company continues its collaborative initiatives with other listed companies and, after hosting a 'Riva Boutique' (Ferretti Group) from November 2024 to the end of January 2025 with works of art, models, loudspeakers and textiles, in February 2025 it launched with Idntt (Euronext Growth Milan) the Colured Is Better project with works for sale specially created by the well-known artist Mr. Savethewall. Finally, a partnership was signed with the 'luxury travel agency' DreamsTeam to offer integrated experiences between art and travel.

2025 will therefore be a crucial year for Deodato.Gallery, to verify its ability to position itself as an all-round operator in the art market, able to offer a wide range of services to collectors, companies and museums. At the beginning of the year, the exhibition 'Beyond the Real: David La Chapelle' took place at Galleria Cavour in Bologna with over 11,000 visitors, the exhibition 'Street Art Revolution. Da "Warhol a Banksy" at Palazzo Tarasconi in Parma until April, and the first 'solo exhibition' of the Portuguese artist Add Fuel was held in Milan and the exhibition of the well-known street-artist TvBoy entitled "Omnia vincit Amor" will soon take place. As far as ESG activities are concerned, given its size Deodato.Gallery is not obliged to draw up sustainability reports; however, in June 2024 it obtained gender equality certification and drew up a related strategic plan, and it has also committed to adopting eco-friendly materials for its installations, to developing works made of recycled materials, and to setting up a foundation for educational projects with a social impact.

As is the case for much of Euronext Growth Milan, unfortunately, Deodato.Gallery also has a very low free float (less than 14%), which is not likely to change significantly for the time being, and this greatly limits the potential interest of analysts and investors. The company does not operate within the 'big listing' of art (the works traded on the Artex Global Markets, a multilateral trading facility dedicated to art, have a unit market value of more than EUR 20 million and so far only two have been listed, by Bacon and Warhol). But this may be an advantage since the current market is proving to be more lively for low cost and therefore more accessible works.

There remains the limitation of the higher Italian tax incidence, for which no change is currently in sight. However, it should be remembered that according to the 2022 study 'Pricing the Art and the Art of Pricing' by Luc Renneboog of the University of Tilburg (Netherlands), the art market has a negative correlation with financial assets such as bonds and stock market indices (while it is positive with diamonds, gold, classic cars, violins and collector wines), and therefore represents a good source of diversification of the investment portfolio.