Bonso Electronics International, Inc. reports 99.9% Net Income decline in 2018 and 39.2% Revenue decline
08/15/2018 • About Bonso Electronics International, Inc. (
$BNSO) • By InTwits
Bonso Electronics International, Inc. reported FY2018 financial results today. Here are the key drivers of the company's long term financial model:
- Bonso Electronics International, Inc. is a company in decline: FY2018 revenue growth was -39.2%, 5 years revenue CAGR was -17.6%
- EBITDA Margin is quite volatile: 14.0% in FY2018, 23.7% in FY2017, 19.4% in FY2016, 6.4% in FY2015, 5.3% in FY2014
- Bonso Electronics International, Inc. has low CAPEX intensity: 5 year average CAPEX/Revenue was 4.2%. At the same time it's in pair with industry average of 3.6%
- CAPEX is quite volatile: $0m in FY2018, $0m in FY2017, $1m in FY2016, $1m in FY2015, $3m in FY2014
- The company has potentially unprofitable business model: ROIC is 1.3%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Bonso Electronics International, Inc.'s Revenue dropped on 39.2%. Revenue decline was accelerating on average at -9.8 pp per annum in FY2014-FY2018. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 9.6 pp from 23.7% to 14.0% in FY2018. During the last 5 years EBITDA Margin topped in FY2017 at 23.7%.
Gross Margin decreased slightly on 0.90 pp from 40.5% to 39.6% in FY2018. Gross Margin grew at 8.2 pp per annum in FY2014-FY2018. SG&A as a % of Revenue jumped on 13.8 pp from 26.7% to 40.5% in FY2018. SG&A as a % of Revenue grew at 7.2 pp per annum in the last 5 years.
Net Income margin dropped on 14.7 pp from 14.7% to 0.035% in FY2018. During the last 5 years Net Income margin topped in FY2017 at 14.7%.
Investments (CAPEX, working capital and M&A)
In FY2018 the company had CAPEX/Revenue of 3.2%. Bonso Electronics International, Inc. showed small CAPEX/Revenue decline of 0.66 pp from 3.8% in FY2015 to 3.2% in FY2018. It's average level of CAPEX/Revenue for the last three years was 2.7%. During FY2014-FY2018 CAPEX as a % of Revenue bottomed in FY2017 at 1.5%.
Return on investment
The company operates at low ROIC (1.3%) and ROE (0.0%). ROIC dropped on 17.6 pp from 18.9% to 1.3% in FY2018. ROE dropped on 18.5 pp from 18.5% to 0.024% in FY2018. During the last 5 years ROIC topped in FY2016 at 19.3% and was declining since that time. During the last 5 years ROE topped in FY2016 at 21.7% and was declining since that time.
Leverage (Debt)
Debt level is -3.7x Net Debt / EBITDA and 1.7x Debt / EBITDA. Debt surged on 434% while cash jumped on 134%.
Bonso Electronics International, Inc. has no short term refinancing risk: cash is higher than short term debt (4,510.8%).
Valuation and dividends
The company's trades at EV/EBITDA 4.3x and P/E 3,250.0x.
Financial and operational results
FY ended 03/31/2018
Bonso Electronics International, Inc. ($BNSO) key annual financial indicators| mln. $ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 31.305 | 28.944 | 23.892 | 18.952 | 11.523 | -39.2% |
| Gross Profit | 2.674 | 5.852 | 7.416 | 7.678 | 4.565 | -40.5% |
| SG&A | 3.353 | 4.067 | 3.923 | 5.066 | 4.669 | -7.8% |
| EBITDA | 1.670 | 1.838 | 4.637 | 4.483 | 1.614 | -64.0% |
| Net Income | -0.221 | 1.110 | 2.871 | 2.795 | 0.004 | -99.9% |
Balance Sheet
|
|---|
| Cash | 0.116 | 3.027 | 3.547 | 3.745 | 8.751 | 133.7% |
| Short Term Debt | 5.500 | 5.364 | 1.927 | 0.456 | 0.194 | -57.5% |
| Long Term Debt | 0.069 | 0.045 | 0.104 | 0.060 | 2.559 | 4,165.0% |
Cash flow
|
|---|
| Capex | 2.778 | 1.105 | 0.823 | 0.289 | 0.364 | 26.0% |
Ratios
|
|---|
| Revenue growth | 3.0% | -7.5% | -17.5% | -20.7% | -39.2% | |
| EBITDA growth | -845.5% | 10.1% | 152.3% | -3.3% | -64.0% | |
|
|---|
| Gross Margin | 8.5% | 20.2% | 31.0% | 40.5% | 39.6% | -0.9% |
| EBITDA Margin | 5.3% | 6.4% | 19.4% | 23.7% | 14.0% | -9.6% |
| SG&A, % of revenue | 10.7% | 14.1% | 16.4% | 26.7% | 40.5% | 13.8% |
| Net Income Margin | -0.7% | 3.8% | 12.0% | 14.7% | 0.0% | -14.7% |
| CAPEX, % of revenue | 8.9% | 3.8% | 3.4% | 1.5% | 3.2% | 1.6% |
|
|---|
| ROIC | 1.7% | 2.6% | 19.3% | 18.9% | 1.3% | -17.6% |
| ROE | -2.1% | 9.9% | 21.7% | 18.5% | 0.0% | -18.5% |
| Net Debt/EBITDA | 3.3x | 1.3x | -0.3x | -0.7x | -3.7x | -3.0x |
Peers in Electronic Equipment & Instrum
Below you can find Bonso Electronics International, Inc. benchmarking vs. other companies in Electronic Equipment & Instrum 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 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Hickok Inc ($HICKA) | | -7.2% | 13.5% | 258.4% | 178.7% |
| Electro Scientific Industries, Inc. ($ESIO) | | -12.2% | 15.9% | -12.7% | 128.5% |
| Microvision, Inc. ($MVIS) | | 163.6% | 60.7% | -34.7% | 82.8% |
| Ipsidy Inc ($IDTY) | | | | | 66.2% |
| Magal Security Systems Ltd. ($MAGS) | | -17.8% | 6.4% | -5.2% | 44.0% |
| |
|---|
| Median (61 companies) | -78.5% | 4.5% | 1.2% | 4.6% | 10.4% |
|---|
| Bonso Electronics International, Inc. ($BNSO) | | -7.5% | -17.5% | -20.7% | -39.2% |
Top companies by Gross margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Intellicheck, Inc. ($IDN) | 58.2% | 57.1% | 80.0% | 85.5% | 91.3% |
| Image Sensing Systems, Inc. ($ISNS) | 74.7% | 77.1% | 71.0% | 79.9% | 80.9% |
| National Instruments Corporation ($NATI) | 74.4% | 74.1% | 74.5% | 74.5% | 75.4% |
| Cognex Corporation ($CGNX) | 77.9% | 77.2% | 75.2% | 75.6% | 74.4% |
| Applied DNA Sciences Inc ($APDN) | | | 82.2% | 77.3% | 69.1% |
| |
|---|
| Median (60 companies) | 42.7% | 42.3% | 41.2% | 41.8% | 42.0% |
|---|
| Bonso Electronics International, Inc. ($BNSO) | 8.5% | 20.2% | 31.0% | 40.5% | 39.6% |
Top companies by EBITDA margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Cognex Corporation ($CGNX) | 32.9% | 30.1% | 31.9% | 36.0% | 30.1% |
| Coherent, Inc. ($COHR) | 14.2% | 16.7% | 18.9% | 24.9% | 26.6% |
| Hollysys Automation Technologies, Ltd. ($HOLI) | 21.3% | 26.9% | 23.5% | 16.1% | 23.9% |
| Electro Scientific Industries, Inc. ($ESIO) | -10.1% | -19.1% | -2.0% | -17.8% | 23.1% |
| FLIR Systems, Inc. ($FLIR) | 20.7% | 22.8% | 21.3% | 20.0% | 21.7% |
| |
|---|
| Median (60 companies) | 5.4% | 3.9% | 3.0% | 3.0% | 3.3% |
|---|
| Bonso Electronics International, Inc. ($BNSO) | 5.3% | 6.4% | 19.4% | 23.7% | 14.0% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Wrap Technologies Inc ($WRTC) | | | | | 61.4% |
| ClearSign Combustion Corporation ($CLIR) | | 80.3% | 22.1% | 17.4% | 17.7% |
| LightPath Technologies, Inc. ($LPTH) | 16.8% | 5.0% | 6.5% | 7.8% | 7.7% |
| Giga-tronics Inc ($GIGA) | 1.7% | 0.1% | 1.3% | 0.3% | 7.0% |
| Applied DNA Sciences Inc ($APDN) | 8.4% | 3.9% | 16.1% | 3.1% | 6.8% |
| |
|---|
| Median (60 companies) | 1.8% | 1.9% | 2.1% | 1.7% | 2.2% |
|---|
| Bonso Electronics International, Inc. ($BNSO) | 8.9% | 3.8% | 3.4% | 1.5% | 3.2% |
Top companies by ROIC, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Evans & Sutherland Computer Corp ($ESCC) | | | 83.3% | 39.6% | 55.3% |
| Electro Scientific Industries, Inc. ($ESIO) | -11.7% | -19.7% | -7.1% | -22.9% | 31.5% |
| Coherent, Inc. ($COHR) | 9.9% | 13.1% | 15.6% | 24.0% | 21.5% |
| Zebra Technologies Corporation ($ZBRA) | 3.3% | 0.9% | 2.2% | 10.2% | 20.8% |
| Cognex Corporation ($CGNX) | 18.3% | 15.6% | 17.7% | 25.6% | 20.1% |
| |
|---|
| Median (72 companies) | 3.3% | 1.8% | 1.8% | 1.8% | 0.9% |
|---|
| Bonso Electronics International, Inc. ($BNSO) | 1.7% | 2.6% | 19.3% | 18.9% | 1.3% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Itron, Inc. ($ITRI) | 2.1x | 1.9x | 1.0x | 2.0x | 12.3x |
| Track Group Inc ($TRCK) | | | | | 12.2x |
| Mesa Laboratories, Inc. ($MLAB) | 0.7x | 1.1x | 1.7x | 2.0x | 3.5x |
| Trimble Inc. ($TRMB) | 1.3x | 1.7x | 1.1x | 1.3x | 3.4x |
| MTS Systems Corporation ($MTSC) | -0.0x | -0.4x | 5.8x | 3.9x | 3.2x |
| |
|---|
| Median (35 companies) | -0.8x | -0.9x | -0.9x | -0.7x | -0.8x |
|---|
| Bonso Electronics International, Inc. ($BNSO) | 3.3x | 1.3x | -0.3x | -0.7x | -3.7x |
