Gazit-Globe Ltd reports 749% Net Income growth and 2.2 pp EBITDA Margin growth from 38.2% to 40.3%
31.03.2016 • About Gazit-Globe Ltd (
$GZT) • By InTwits
Gazit-Globe Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Gazit-Globe Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 71.2%. At the same time it's a lot of higher than industry average of 8.6%.
- CAPEX is quite volatile: 3,353 in 2015, 3,296 in 2014, 3,044 in 2013, 5,741 in 2012, 6,483 in 2011
- The company has potentially unprofitable business model: ROIC is at 2.5%
- It operates with high leverage: Net Debt/EBITDA is 22.1x while industry average is 8.9x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Gazit-Globe Ltd ($GZT) key annual financial indicators
| mln. ILS | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 5,834 | 7,162 | 7,036 | 6,325 | 4,836 | -23.5% |
| EBITDA | 2,569 | 3,131 | 3,009 | 2,413 | 1,949 | -19.2% |
| Net Income | 719 | 957 | 927 | 73 | 620 | 749.3% |
Balance Sheet
|
|---|
| Cash | 1,539 | 1,683 | 1,018 | 650 | 2,037 | 213.4% |
| Short Term Debt | 3,978 | 2,733 | 3,171 | 3,264 | 3,341 | 2.4% |
| Long Term Debt | 35,473 | 39,130 | 36,144 | 34,239 | 41,858 | 22.3% |
Cash flow
|
|---|
| Capex | 6,483 | 5,741 | 3,044 | 3,296 | 3,353 | 1.7% |
Ratios
|
|---|
| Revenue growth | 10.3% | 22.8% | -1.8% | -10.1% | -23.5% | |
| EBITDA growth | 1.5% | 21.9% | -3.9% | -19.8% | -19.2% | |
| EBITDA Margin | 44.0% | 43.7% | 42.8% | 38.2% | 40.3% | 2.2% |
| Net Income Margin | 12.3% | 13.4% | 13.2% | 1.2% | 12.8% | 11.7% |
| CAPEX, % of revenue | 111.1% | 80.2% | 43.3% | 52.1% | 69.3% | 17.2% |
| ROIC | 4.5% | 4.8% | 4.5% | 3.6% | 2.5% | -1.1% |
| ROE | 10.9% | 12.6% | 11.8% | 0.9% | 8.0% | 7.1% |
| Net Debt/EBITDA | 14.8x | 12.8x | 12.7x | 15.3x | 22.1x | 6.9x |
Revenue and profitability
The company's Revenue dropped on 23.5% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 2.2 pp from 38.2% to 40.3% in 2015.
Net Income marign surged on 11.7 pp from 1.2% to 12.8% in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 69.3% in 2015. Gazit-Globe Ltd's CAPEX/Revenue dropped on 10.8 pp from 80.2% in 2012 to 69.3% in 2015. Average CAPEX/Revenue for the last three years was 54.9%.Battling declining revenue Gazit-Globe Ltd made large investments to CAPEX (172% of EBITDA) but that didn't help at least in this year.
Return on investment
The company operates at low ROIC (2.52%) and ROE (7.98%). ROIC decreased slightly on 1.1 pp from 3.6% to 2.5% in 2015. ROE increased on 7.1 pp from 0.92% to 8.0% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 22.1x and Debt / EBITDA is 23.2x. Net Debt / EBITDA jumped on 6.9x from 15.3x to 22.1x in 2015. Debt jumped on 20.5% in 2015 while cash surged on 213% in 2015.
Appendix 1: Peers in Financial
Below we provide Gazit-Globe Ltd benchmarking against other companies in Financial 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 |
|---|
| Mogo Finance Technology Inc ($GO) | | | 13.7% | 34.6% | 86.0% |
| Morguard Corp ($MRC) | | 5.3% | 27.2% | 9.2% | 58.8% |
| Terra Firma Capital Corp ($TII) | | 306.8% | 61.9% | 39.1% | 56.9% |
| Chesswood Group Ltd ($CHW) | | 12.2% | 9.4% | -47.4% | 53.7% |
| Callidus Capital Corp ($CBL) | | 19.0% | 93.5% | 134.2% | 49.6% |
| |
|---|
| Median (70 companies) | 52.7% | 9.3% | 7.8% | 9.0% | 1.3% |
|---|
| Gazit-Globe Ltd ($GZT) | | 22.8% | -1.8% | -10.1% | -23.5% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Olympia Financial Group Inc ($OLY) | 85.3% | 80.9% | 82.6% | 83.2% | 84.5% |
| Morguard Corp ($MRC) | 74.8% | 74.0% | 69.9% | 68.6% | 76.5% |
| Mogo Finance Technology Inc ($GO) | | 70.4% | 64.5% | 63.4% | 62.3% |
| Clarke Inc ($CKI) | 9.9% | 28.1% | 20.0% | 18.9% | 43.4% |
| Onex Corp ($OCX) | 20.0% | 20.1% | 26.2% | 27.9% | 31.0% |
| |
|---|
| Median (10 companies) | 25.2% | 25.0% | 26.2% | 24.2% | 30.5% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Firm Capital Mortgage Investment Corp ($FC) | 88.7% | 87.6% | 87.9% | 88.8% | 86.6% |
| Equitable Group Inc ($EQB) | 89.7% | 88.1% | 87.4% | 86.0% | 84.7% |
| Atrium Mortgage Investment Corp ($AI) | 84.5% | 79.8% | | | 81.9% |
| Trez Capital Mortgage Investment Corp ($TZZ) | | | | | 76.2% |
| First National Financial Corp ($FN) | 66.1% | 67.8% | 76.5% | 77.1% | 74.6% |
| |
|---|
| Median (45 companies) | 35.6% | 29.5% | 31.9% | 29.4% | 27.0% |
|---|
| Gazit-Globe Ltd ($GZT) | 44.0% | 43.7% | 42.8% | 38.2% | 40.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Imperial Equities Inc ($IEI) | 23.1% | 22.8% | 16.0% | 27.7% | 147.5% |
| Dundee Corp ($DC.A) | | 10.3% | 14.1% | 88.8% | 123.6% |
| Wall Financial Corp ($WFC) | 1.8% | 13.5% | 9.8% | 6.1% | 65.3% |
| First Capital Realty Inc ($FCR) | 102.8% | 127.9% | 76.1% | 73.8% | 56.7% |
| Mainstreet Equity Corp ($MEQ) | 152.4% | 115.8% | 62.3% | 75.8% | 56.3% |
| |
|---|
| Median (72 companies) | 1.0% | 1.0% | 0.7% | 1.0% | 1.0% |
|---|
| Gazit-Globe Ltd ($GZT) | 111.1% | 80.2% | 43.3% | 52.1% | 69.3% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Gluskin Sheff + Associates Inc ($GS) | 71.3% | 21.0% | 82.9% | 153.9% | 63.6% |
| Brookfield Real Estate Services Inc ($BRE) | 17.1% | 26.0% | 31.0% | 47.0% | 61.0% |
| IGM Financial Inc ($IGM) | 15.3% | 14.2% | 14.2% | 13.7% | 13.7% |
| Clairvest Group Inc ($CVG) | 7.6% | 8.6% | 12.3% | 11.5% | 12.8% |
| Canadian Western Bank ($CWB) | 13.0% | 12.4% | 12.1% | 12.4% | 11.6% |
| |
|---|
| Median (72 companies) | 5.3% | 4.8% | 4.6% | 4.8% | 4.8% |
|---|
| Gazit-Globe Ltd ($GZT) | 4.5% | 4.8% | 4.5% | 3.6% | 2.5% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Element Financial Corp ($EFN) | | 140.2x | 31.9x | 37.6x | 79.9x |
| First National Financial Corp ($FN) | 37.6x | 34.3x | 33.7x | 40.9x | 37.4x |
| Wall Financial Corp ($WFC) | 6.2x | 3.4x | 19.9x | 4.6x | 20.1x |
| Equitable Group Inc ($EQB) | 12.7x | 11.8x | 10.2x | 9.8x | 12.3x |
| Rifco Inc ($RFC) | | 9.8x | 9.4x | 10.7x | 11.9x |
| |
|---|
| Median (35 companies) | 2.9x | 5.2x | 4.8x | 4.2x | 5.6x |
|---|
| Gazit-Globe Ltd ($GZT) | 14.8x | 12.8x | 12.7x | 15.3x | 22.1x |
