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Nahl Group EBITDA dropped on 19.6% in 2017 and EBITDA Margin decreased on 7.5 pp from 34.9% to 27.4%

20 Mar 2018 • About Nahl Group ($NAH) • By InTwits

Nahl Group reported 2017 financial results today. Overall looking at the company's long term financial model we can say that:
  • Nahl Group has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.3%.
  • The company has highly profitable business model: ROIC is at 17.3%
  • It operates with high leverage: Net Debt/EBITDA is 0.8x while industry average is 0.7x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.

Nahl Group ($NAH) key annual financial indicators

mln. £201320142015201620172017/2016
P&L
Revenue49.12343.84850.71650.63551.9122.5%
Gross Profit26.03319.96324.93129.82626.688-10.5%
SG&A8.19010.81213.66514.0863.1%
EBITDA19.45912.63714.96617.68314.210-19.6%
Net Income9.4588.47310.76612.2249.876-19.2%
Balance Sheet
Cash14.24913.63710.0564.8140.858-82.2%
Short Term Debt6.7892.9503.6933.6930.000-100.0%
Long Term Debt0.0702.95111.0897.39612.92274.7%
Cash flow
Capex0.1770.0270.1950.2320.111-52.2%
Ratios
Revenue growth-3.2%-10.7%15.7%-0.2%2.5%
EBITDA growth4.7%-35.1%18.4%18.2%-19.6%
Gross Margin53.0%45.5%49.2%58.9%51.4%-7.5%
EBITDA Margin39.6%28.8%29.5%34.9%27.4%-7.5%
Net Income Margin19.3%19.3%21.2%24.1%19.0%-5.1%
SG&A, % of revenue18.7%21.3%27.0%27.1%0.1%
CAPEX, % of revenue0.4%0.1%0.4%0.5%0.2%-0.2%
ROIC42.3%31.5%26.0%23.0%17.3%-5.7%
ROE37.2%25.5%23.6%21.3%16.3%-5.0%
Net Debt/EBITDA-0.4x-0.6x0.3x0.4x0.8x0.5x

Revenue and profitability


Nahl Group's Revenue increased on 2.5% in 2017. Revenue growth was financed by EBITDA margin decline. EBITDA Margin decreased on 7.5 pp from 34.9% to 27.4% in 2017.

Gross Margin decreased on 7.5 pp from 58.9% to 51.4% in 2017. SG&A as a % of Revenue showed almost no change in 2017.

Net Income marign decreased on 5.1 pp from 24.1% to 19.0% in 2017.

Capital expenditures (CAPEX) and working capital investments


In 2017 the company had CAPEX/Revenue of 0.21%. The company showed almost no change in CAPEX/Revenue from 2014 to 2017. For the last three years the average CAPEX/Revenue was 0.35%.

Return on investment


The company operates at good ROIC (17.31%) and ROE (16.25%). ROIC decreased on 5.7 pp from 23.0% to 17.3% in 2017. ROE decreased on 5.0 pp from 21.3% to 16.3% in 2017.

Leverage (Debt)


Debt level is 0.8x Net Debt / EBITDA and 0.9x Debt / EBITDA. Net Debt / EBITDA jumped on 0.5x from 0.4x to 0.8x in 2017. Debt jumped on 16.5% in 2017 while cash dropped on 82.2% in 2017.

Valuation


The company's trades at EV/EBITDA 5.8x and P/E 7.1x.

Appendix 1: Peers in Media


Below you can find Nahl Group benchmarking vs. other companies in Media industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.

Top companies by Revenue growth, %

Top 5 FY2013 FY2014 FY2015 FY2016 FY2017
Marimedia Ltd ($MARI)71.1%45.7%20.1%66.0%
Grupo Clarin Sa ($GCLA)24.6%39.8%-57.9%37.2%
Uls Technology ($ULS)26.6%53.9%-1.0%28.0%
Ten Alps ($TAL)-19.1%25.5%
Brainjuicer Group ($BJU)17.5%0.8%2.2%24.0%
 
Median (15 companies)-0.6%1.9%0.8%6.5%
Nahl Group ($NAH)-10.7%15.7%-0.2%2.5%


Top companies by Gross margin, %

Top 5 FY2013 FY2014 FY2015 FY2016 FY2017
Jaywing ($JWNG)76.8%81.0%89.0%88.4%
Brainjuicer Group ($BJU)78.0%78.8%80.4%82.1%
Haynes Publishing Group ($HYNS)59.6%52.9%60.2%53.6%
Mood Media Corp ($MM.)54.4%53.9%51.6%52.2%
Naspers ($NPSN)44.5%43.5%41.8%42.8%
 
Median (11 companies)41.6%43.5%41.2%41.9%
Nahl Group ($NAH)53.0%45.5%49.2%58.9%51.4%


Top companies by EBITDA margin, %

Top 5 FY2013 FY2014 FY2015 FY2016 FY2017
Brainjuicer Group ($BJU)16.4%19.2%19.9%21.4%
Uls Technology ($ULS)16.3%16.7%21.1%19.8%
Independent News & Media ($INM)40.8%10.9%12.5%18.1%
Mood Media Corp ($MM.)13.9%14.8%13.0%16.5%
Haynes Publishing Group ($HYNS)23.4%38.8%33.5%15.4%
 
Median (12 companies)13.9%13.7%9.8%9.5%
Nahl Group ($NAH)39.6%28.8%29.5%34.9%27.4%


Top companies by CAPEX/Revenue, %

Top 5 FY2013 FY2014 FY2015 FY2016 FY2017
Mood Media Corp ($MM.)6.4%6.9%8.2%5.9%
Naspers ($NPSN)4.9%4.0%3.1%
Grupo Clarin Sa ($GCLA)13.2%12.8%1.6%2.7%
Johnston Press ($JPR)1.5%2.7%2.5%1.5%
Jaywing ($JWNG)2.0%1.5%1.3%1.3%
 
Median (12 companies)1.8%1.7%1.1%0.9%
Nahl Group ($NAH)0.4%0.1%0.4%0.5%0.2%


Top companies by ROIC, %

Top 5 FY2013 FY2014 FY2015 FY2016 FY2017
Independent News & Media ($INM)136.2%29.6%65.1%122.1%
Brainjuicer Group ($BJU)49.0%60.0%58.5%72.5%
Uls Technology ($ULS)33.2%44.1%39.6%39.3%
Grupo Clarin Sa ($GCLA)21.8%29.8%6.4%5.8%
Jaywing ($JWNG)2.8%-0.7%-2.6%3.3%
 
Median (15 companies)5.4%7.8%6.4%1.7%
Nahl Group ($NAH)42.3%31.5%26.0%23.0%17.3%


Top companies by Net Debt / EBITDA

Top 5 FY2013 FY2014 FY2015 FY2016 FY2017
Naspers ($NPSN)1.9x6.2x14.7x
Mood Media Corp ($MM.)8.1x8.2x9.8x7.9x
Jaywing ($JWNG)0.7x3.3x1.9x1.6x
Grupo Clarin Sa ($GCLA)0.8x0.7x4.3x0.3x
Haynes Publishing Group ($HYNS)-0.9x0.1x-0.0x-0.1x
 
Median (10 companies)0.8x1.0x0.9x-0.4x
Nahl Group ($NAH)-0.4x-0.6x0.3x0.4x0.8x