GVIC Communications Corp reports 711% EBITDA decline and 11.0% Revenue decline
29.03.2016 • About GVIC Communications Corp (
$GCT) • By InTwits
GVIC Communications Corp reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- GVIC Communications Corp doesn't have a profitable business model yet: 2015 ROIC is -65.1%
- GVIC Communications Corp motivates its personel by high Stock Based Compensation (SBC): average SBC/Revenue for 2011-2015 was 0.0%. On average EBITDA Margin was -2.2% for the sames years0
- GVIC Communications Corp has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.3%. At the same time it's in pair with industry average of 5.1%.
- CAPEX is quite volatile: 3 in 2015, 1.7 in 2014, 9.5 in 2013, 4.2 in 2012, 11.5 in 2011
- The company has unprofitable business model: ROIC is at -65.1%
- It operates with high leverage: Net Debt/EBITDA is 2.5x while industry average is -0.1x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
GVIC Communications Corp ($GCT) key annual financial indicators
| mln. CAD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 267.4 | 297.1 | 262.1 | 247.9 | 220.7 | -11.0% |
| Gross Profit | 93.7 | 89.2 | 76.0 | 72.9 | 64.7 | -11.2% |
| SG&A | | | | | 46.8 | |
| EBITDA | 49.7 | 40.0 | 28.9 | 28.7 | -175.6 | -711.2% |
| Net Income | 25.4 | 9.1 | -69.8 | -0.6 | -159.2 | 24,622.5% |
Balance Sheet
|
|---|
| Cash | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
| Short Term Debt | 10.7 | 8.2 | 6.7 | 9.7 | 6.4 | -34.1% |
| Long Term Debt | 141.5 | 128.4 | 106.9 | 85.1 | 80.4 | -5.6% |
Cash flow
|
|---|
| Capex | 11.5 | 4.2 | 9.5 | 1.7 | 3.0 | 79.6% |
Ratios
|
|---|
| Revenue growth | 10.2% | 11.1% | -11.8% | -5.4% | -11.0% | |
| EBITDA growth | 11.6% | -19.5% | -27.8% | -0.6% | -711.2% | |
| Gross Margin | 35.0% | 30.0% | 29.0% | 29.4% | 29.3% | -0.1% |
| EBITDA Margin | 18.6% | 13.5% | 11.0% | 11.6% | -79.6% | -91.1% |
| Net Income Margin | 9.5% | 3.0% | -26.6% | -0.3% | -72.1% | -71.9% |
| SG&A, % of revenue | | | | | 21.2% | 21.2% |
| CAPEX, % of revenue | 4.3% | 1.4% | 3.6% | 0.7% | 1.4% | 0.7% |
| ROIC | 7.7% | 5.1% | 3.2% | 3.9% | -65.1% | -69.0% |
| ROE | 8.2% | 2.8% | -24.3% | -0.3% | -99.2% | -98.9% |
| Net Debt/EBITDA | 3.1x | 3.4x | 3.9x | 3.3x | | -3.3x |
Revenue and profitability
The company's Revenue dropped on 11.0% in 2015. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin dropped on 91.1 pp from 11.6% to -79.6% in 2015.
Gross Margin showed almost no change in 2015.
Net Income marign dropped on 71.9 pp from -0.26% to -72.1% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 1.4%. CAPEX/Revenue showed almost no change from 2012 to 2015. For the last three years the average CAPEX/Revenue was 1.9%.
Return on investment
The company operates at negative ROIC (-65.05%) and ROE (-99.20%). ROIC dropped on 69.0 pp from 3.9% to -65.1% in 2015. ROE dropped on 98.9 pp from -0.26% to -99.2% in 2015.
Leverage (Debt)
Debt level is 2.5x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA dropped on 3.3x from 3.3x to in 2015. Debt decreased on 8.5% in 2015 while cash didn't change in 2015.
Appendix 1: Peers in Communications
Below we provide GVIC Communications Corp benchmarking against other companies in Communications industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Intertain Group Ltd/The ($IT) | | | | | 842.9% |
| DragonWave Inc ($DWI) | | -61.3% | 171.3% | -27.3% | 75.3% |
| Blackline Safety Corp ($BLN) | | 37.1% | 9.4% | 45.1% | 73.8% |
| NeuLion Inc ($NLN) | | -1.7% | 20.8% | 17.9% | 69.4% |
| TVA Group Inc ($TVA.B) | | 1.7% | -1.8% | -1.2% | 34.3% |
| |
|---|
| Median (46 companies) | -0.5% | 3.8% | 2.3% | 2.5% | 2.7% |
|---|
| GVIC Communications Corp ($GCT) | | 11.1% | -11.8% | -5.4% | -11.0% |
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% |
| NeuLion Inc ($NLN) | 45.2% | 53.6% | 63.8% | 70.2% | 81.1% |
| Mediagrif Interactive Technologies Inc ($MDF) | 78.2% | 79.8% | 79.8% | 78.8% | 80.1% |
| TeraGo Inc ($TGO) | 65.0% | 62.9% | 61.8% | 59.8% | 77.2% |
| |
|---|
| Median (36 companies) | 43.3% | 43.3% | 42.7% | 43.1% | 48.3% |
|---|
| GVIC Communications Corp ($GCT) | 35.0% | 30.0% | 29.0% | 29.4% | 29.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Cogeco Cable Inc ($CCA) | 45.8% | 46.0% | 44.9% | 43.8% | 46.2% |
| Shaw Communications Inc ($SJR.B) | 43.3% | 42.7% | 43.3% | 42.1% | 44.6% |
| Cogeco Inc ($CGO) | 28.1% | 43.2% | 43.5% | 43.3% | 44.3% |
| Manitoba Telecom Services Inc ($MBT) | 33.7% | 34.3% | 33.7% | 47.4% | 42.3% |
| Mediagrif Interactive Technologies Inc ($MDF) | 32.0% | 32.5% | 41.3% | 37.2% | 39.0% |
| |
|---|
| Median (45 companies) | 13.8% | 14.5% | 14.6% | 12.6% | 15.0% |
|---|
| GVIC Communications Corp ($GCT) | 18.6% | 13.5% | 11.0% | 11.6% | -79.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Axia NetMedia Corp ($AXX) | 10.7% | 30.8% | 27.2% | 27.0% | 36.2% |
| Manitoba Telecom Services Inc ($MBT) | 16.3% | 19.8% | 18.1% | 22.4% | 22.9% |
| Shaw Communications Inc ($SJR.B) | 17.4% | 18.2% | 18.2% | 19.7% | 22.2% |
| Cogeco Cable Inc ($CCA) | 24.6% | 28.1% | 23.0% | 20.6% | 20.7% |
| TELUS Corp ($T) | 18.0% | 17.9% | 17.8% | 19.8% | 20.2% |
| |
|---|
| Median (45 companies) | 4.1% | 2.3% | 2.8% | 2.2% | 2.3% |
|---|
| GVIC Communications Corp ($GCT) | 4.3% | 1.4% | 3.6% | 0.7% | 1.4% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Tucows Inc ($TC) | 12.8% | 17.7% | 22.5% | 35.4% | 51.4% |
| Points International Ltd ($PTS) | 20.7% | 14.9% | 15.0% | 21.2% | 18.8% |
| RDM Corp ($RC) | -2.3% | 3.5% | 7.8% | 11.0% | 14.7% |
| Vecima Networks Inc ($VCM) | -0.6% | 11.7% | 6.4% | 11.4% | 14.5% |
| Norsat International Inc ($NII) | 3.1% | 10.9% | 1.4% | 13.7% | 13.8% |
| |
|---|
| Median (46 companies) | 6.3% | 8.6% | 8.7% | 8.3% | 3.8% |
|---|
| GVIC Communications Corp ($GCT) | 7.7% | 5.1% | 3.2% | 3.9% | -65.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Intertain Group Ltd/The ($IT) | | | | | 9.4x |
| MDC Partners Inc ($MDZ.A) | 7.3x | 12.4x | 112.6x | 4.6x | 5.5x |
| Quebecor Inc ($QBR.B) | 2.0x | 3.7x | 3.9x | 4.2x | 4.8x |
| Plaintree Systems Inc ($NPT) | 0.7x | | | 124.2x | 3.9x |
| Rogers Communications Inc ($RCI.A) | 2.2x | 2.3x | 2.4x | 3.2x | 3.6x |
| |
|---|
| Median (34 companies) | 0.9x | 1.4x | 1.2x | 1.4x | 1.5x |
|---|
