Platinum Communications Corp EBITDA dropped on 16.9% in 2015 and EBITDA Margin decreased on 3.1 pp from 20.8% to 17.7%
09.12.2015 • About Platinum Communications Corp (
$PCS) • By InTwits
Platinum Communications Corp reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Platinum Communications Corp doesn't have a profitable business model yet: FY2015 ROIC is 1.5%
- Platinum Communications Corp has medium CAPEX intensity: 5 year average CAPEX/Revenue was 6.7%. At the same time it's in pair with industry average of 8.1%.
- CAPEX is quite volatile: 0.23 in FY2015, 0.24 in FY2014, 0.15 in FY2013, 0.50 in FY2012, 0.32 in FY2011
- The company has potentially unprofitable business model: ROIC is at 1.5%
- It operates with high leverage: Net Debt/EBITDA is 1.6x while industry average is -0.2x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Platinum Communications Corp ($PCS) key annual financial indicators
| mln. CAD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 6.368 | 7.100 | 8.846 | 10.359 | 10.111 | -2.4% |
| Gross Profit | 4.358 | 4.782 | 5.936 | 6.233 | 6.119 | -1.8% |
| SG&A | | | 1.287 | 1.190 | 1.075 | -9.7% |
| EBITDA | 1.361 | 1.511 | 2.187 | 2.151 | 1.788 | -16.9% |
| Net Income | -0.016 | 0.198 | 2.148 | 0.165 | 0.150 | -8.9% |
Balance Sheet
|
|---|
| Cash | 0.643 | 0.536 | 1.366 | 0.992 | 0.808 | -18.5% |
| Short Term Debt | 1.562 | 0.508 | 1.358 | 0.904 | 0.967 | 7.1% |
| Long Term Debt | 0.045 | 2.176 | 3.195 | 3.734 | 2.789 | -25.3% |
Cash flow
|
|---|
| Capex | 0.485 | 0.588 | 0.594 | 0.553 | 0.583 | 5.3% |
Ratios
|
|---|
| Revenue growth | 14.0% | 11.5% | 24.6% | 17.1% | -2.4% | |
| EBITDA growth | 70.3% | 11.0% | 44.8% | -1.6% | -16.9% | |
| Gross Margin | 68.4% | 67.4% | 67.1% | 60.2% | 60.5% | 0.3% |
| EBITDA Margin | 21.4% | 21.3% | 24.7% | 20.8% | 17.7% | -3.1% |
| Net Income Margin | -0.2% | 2.8% | 24.3% | 1.6% | 1.5% | -0.1% |
| SG&A, % of revenue | | | 14.6% | 11.5% | 10.6% | -0.9% |
| CAPEX, % of revenue | 7.6% | 8.3% | 6.7% | 5.3% | 5.8% | 0.4% |
| ROIC | 2.0% | 6.0% | 9.1% | 7.5% | 1.5% | -6.0% |
| ROE | -0.3% | 4.1% | 35.7% | 2.3% | 2.0% | -0.3% |
| Net Debt/EBITDA | 0.7x | 1.4x | 1.5x | 1.7x | 1.6x | -0.0x |
Revenue and profitability
Platinum Communications Corp's Revenue decreased on 2.4% in FY2015. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 3.1 pp from 20.8% to 17.7% in FY2015.
Gross Margin showed almost no change in FY2015. SG&A as a % of Revenue decreased slightly on 0.86 pp from 11.5% to 10.6% in FY2015.
Net Income marign showed almost no change in FY2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 5.8% in FY2015. Platinum Communications Corp's CAPEX/Revenue decreased on 2.5 pp from 8.3% in FY2012 to 5.8% in FY2015. For the last three years the average CAPEX/Revenue was 5.9%.
Return on investment
The company operates at low ROIC (1.49%) and ROE (1.98%). ROIC decreased on 6.0 pp from 7.5% to 1.5% in FY2015. ROE showed almost no change in FY2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 1.6x and Debt / EBITDA is 2.1x. Net Debt / EBITDA decreased on 0.046x from 1.7x to 1.6x in FY2015. Debt dropped on 19.0% in FY2015 while cash dropped on 18.5% in FY2015.
Appendix 1: Peers in Communications
Below you can find Platinum Communications Corp benchmarking vs. other companies in Communications 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 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Telehop Communications Inc ($HOP) | -11.7% | -13.1% | -7.8% | 105.7% | |
| Wi2Wi Corp ($YTY) | | | 11.5% | 100.3% | |
| BSM Technologies Inc ($GPS) | | | 39.1% | 55.5% | |
| Plaintree Systems Inc ($NPT) | | 14.5% | 9.1% | 50.8% | -7.1% |
| Aimia Inc ($AIM) | 2.9% | 6.3% | -25.6% | 47.5% | |
| |
|---|
| Median (49 companies) | 7.8% | 2.5% | 1.8% | 1.9% | 2.7% |
|---|
| Platinum Communications Corp ($PCS) | | 11.5% | 24.6% | 17.1% | -2.4% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Wanted Technologies Corp ($WAN) | 86.6% | 90.5% | 93.2% | 94.3% | 95.6% |
| CounterPath Corp ($CCV) | 74.1% | 80.0% | 85.1% | 80.9% | 81.5% |
| Mediagrif Interactive Technologies Inc ($MDF) | 78.2% | 79.8% | 79.8% | 78.8% | 80.1% |
| NeuLion Inc ($NLN) | 45.2% | 53.6% | 63.8% | 70.2% | |
| Sangoma Technologies Corp ($STC) | 74.5% | 68.8% | | 66.9% | 67.2% |
| |
|---|
| Median (40 companies) | 43.2% | 42.8% | 42.5% | 41.8% | 60.5% |
|---|
| Platinum Communications Corp ($PCS) | 68.4% | 67.4% | 67.1% | 60.2% | 60.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Manitoba Telecom Services Inc ($MBT) | 33.7% | 34.3% | 33.7% | 47.4% | |
| Cogeco Cable Inc ($CCA) | 45.8% | 46.0% | 44.9% | 43.8% | 46.2% |
| Cogeco Inc ($CGO) | 28.1% | 43.2% | 43.5% | 43.3% | 44.3% |
| Shaw Communications Inc ($SJR.B) | 43.3% | 42.7% | 43.3% | 42.1% | 44.6% |
| BCE Inc ($BCE) | 37.0% | 38.8% | 37.7% | 38.4% | |
| |
|---|
| Median (49 companies) | 14.1% | 13.5% | 14.1% | 11.7% | 14.3% |
|---|
| Platinum Communications Corp ($PCS) | 21.4% | 21.3% | 24.7% | 20.8% | 17.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Newfoundland Capital Corp Ltd ($NCC.B) | | 8.7% | 5.5% | 76.8% | |
| Axia NetMedia Corp ($AXX) | 10.7% | 30.8% | 27.2% | 27.0% | |
| UrtheCast Corp ($UR) | | | | 26.5% | |
| TeraGo Inc ($TGO) | 21.6% | 20.9% | 21.5% | 23.1% | |
| Manitoba Telecom Services Inc ($MBT) | 16.3% | 19.8% | 18.1% | 22.4% | |
| |
|---|
| Median (52 companies) | 4.3% | 2.2% | 3.0% | 2.1% | 2.2% |
|---|
| Platinum Communications Corp ($PCS) | 7.6% | 8.3% | 6.7% | 5.3% | 5.8% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Wi2Wi Corp ($YTY) | -28.5% | -166.9% | | 136.7% | |
| Tucows Inc ($TC) | 12.8% | 17.7% | 22.5% | 35.4% | |
| Asian Television Network International Ltd ($SAT) | 102.7% | 34.6% | 23.6% | 23.4% | |
| Points International Ltd ($PTS) | 20.7% | 14.9% | 15.0% | 21.2% | |
| NeuLion Inc ($NLN) | -62.1% | -55.8% | -10.3% | 18.5% | |
| |
|---|
| Median (53 companies) | 7.2% | 9.2% | 8.2% | 8.3% | 2.7% |
|---|
| Platinum Communications Corp ($PCS) | 2.0% | 6.0% | 9.1% | 7.5% | 1.5% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Plaintree Systems Inc ($NPT) | 0.7x | | | 124.2x | 3.9x |
| Advantex Marketing International Inc ($ADX) | | 4.8x | 2.2x | 5.0x | |
| MDC Partners Inc ($MDZ.A) | 7.3x | 12.4x | 112.6x | 4.6x | |
| Quebecor Inc ($QBR.B) | 2.0x | 3.7x | 3.9x | 4.2x | |
| Postmedia Network Canada Corp ($PNC.B) | 2.9x | 3.3x | 3.4x | 4.2x | |
| |
|---|
| Median (41 companies) | 1.0x | 1.4x | 1.3x | 1.4x | 1.7x |
|---|
| Platinum Communications Corp ($PCS) | 0.7x | 1.4x | 1.5x | 1.7x | 1.6x |
