DealNet Capital Corp reports 58.4% revenue growth in 2015 and 28.1 pp EBITDA Margin decline from -13.4% to -41.5%
28.04.2016 • About DealNet Capital Corp (
$DLS) • By InTwits
DealNet Capital Corp reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- DealNet Capital Corp doesn't have a profitable business model yet: 2015 ROIC is -71.2%
- The company operates at negative EBITDA Margin: -41.5%
- DealNet Capital Corp motivates its personel by high Stock Based Compensation (SBC): average SBC/Revenue for 2011-2015 was 0.0%. On average EBITDA Margin was -32.4% for the sames years0
- DealNet Capital Corp has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.1%. At the same time it's a lot of higher than industry average of 94.4%.
- CAPEX is quite volatile: 0.23 in 2015, 0.25 in 2014, 0.30 in 2013, 0 in 2012, 0 in 2011
- The company has unprofitable business model: ROIC is at -71.2%
- It operates with high leverage: Net Debt/EBITDA is 18.6x while industry average is 8.9x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
DealNet Capital Corp ($DLS) key annual financial indicators
| mln. CAD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 0.016 | 0.726 | 4.649 | 9.890 | 15.662 | 58.4% |
| Gross Profit | | 0.108 | 1.708 | 4.510 | 6.426 | 42.5% |
| SG&A | | | 3.396 | 5.889 | 4.511 | -23.4% |
| EBITDA | -0.508 | | -1.688 | -1.322 | -6.493 | 391.1% |
| Net Income | 0.027 | -1.081 | -2.455 | -4.575 | -6.497 | 42.0% |
Balance Sheet
|
|---|
| Cash | 0.000 | 0.121 | 0.073 | 0.616 | 10.812 | 1,655.2% |
| Short Term Debt | 0.570 | 0.565 | 0.654 | 3.141 | 0.000 | -100.0% |
| Long Term Debt | 0.000 | 0.000 | 2.400 | 0.194 | 3.804 | 1,860.8% |
Cash flow
|
|---|
| Capex | 0.000 | 0.000 | 0.295 | 0.247 | 0.227 | -8.1% |
Ratios
|
|---|
| Revenue growth | -73.3% | 4,437.5% | 540.4% | 112.7% | 58.4% | |
| EBITDA growth | -4.3% | | | -21.7% | 391.1% | |
| Gross Margin | | 14.9% | 36.7% | 45.6% | 41.0% | -4.6% |
| EBITDA Margin | -3,175.0% | 0.0% | -36.3% | -13.4% | -41.5% | -28.1% |
| Net Income Margin | 168.8% | -148.9% | -52.8% | -46.3% | -41.5% | 4.8% |
| SG&A, % of revenue | | | 73.0% | 59.5% | 28.8% | -30.7% |
| CAPEX, % of revenue | 0.0% | 0.0% | 6.3% | 2.5% | 1.4% | -1.0% |
| ROIC | | | -260.8% | -130.0% | -71.2% | 58.8% |
Revenue and profitability
The company's Revenue surged on 58.4% in 2015. Revenue growth was financed by EBITDA margin decline. EBITDA Margin dropped on 28.1 pp from -13.4% to -41.5% in 2015.
Gross Margin decreased on 4.6 pp from 45.6% to 41.0% in 2015. SG&A as a % of Revenue dropped on 30.7 pp from 59.5% to 28.8% in 2015.
Net Income marign increased on 4.8 pp from -46.3% to -41.5% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 1.4%. CAPEX/Revenue increased slightly1.4 pp from 0% in 2012 to 1.4% in 2015. Average CAPEX/Revenue for the last three years was 3.4%.
Leverage (Debt)
Debt level is 18.6x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA didn't change in 2015. Debt surged on 14.1% in 2015 while cash jumped on 1,655% in 2015.
Appendix 1: Peers in Financial
Below we provide DealNet Capital Corp 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 |
|---|
| Grenville Strategic Royalty Corp ($GRC) | | | | | 317.2% |
| IOU Financial Inc ($IOU) | | 562.1% | 331.7% | 52.2% | 94.3% |
| 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 ($TII) | | 306.8% | 61.9% | 39.1% | 56.9% |
| |
|---|
| Median (74 companies) | 52.7% | 9.3% | 7.7% | 9.0% | 1.5% |
|---|
| DealNet Capital Corp ($DLS) | | 4,437.5% | 540.4% | 112.7% | 58.4% |
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 ($OCX) | 20.0% | 20.1% | 26.2% | 27.9% | 31.0% |
| |
|---|
| Median (11 companies) | 24.0% | 25.0% | 25.2% | 19.7% | 30.1% |
|---|
| DealNet Capital Corp ($DLS) | | 14.9% | 36.7% | 45.6% | 41.0% |
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 ($FN) | 66.1% | 67.8% | 76.5% | 77.1% | 74.6% |
| |
|---|
| Median (49 companies) | 36.1% | 29.5% | 32.0% | 30.5% | 27.0% |
|---|
| DealNet Capital Corp ($DLS) | -3,175.0% | | -36.3% | -13.4% | -41.5% |
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% |
| Gazit-Globe Ltd ($GZT) | 111.1% | 80.2% | 43.3% | 52.1% | 69.3% |
| Wall Financial Corp ($WFC) | | 13.5% | 9.8% | 6.1% | 65.3% |
| First Capital Realty Inc ($FCR) | 102.8% | 127.9% | 76.1% | 73.8% | 56.7% |
| |
|---|
| Median (76 companies) | 1.3% | 1.4% | 0.8% | 1.0% | 1.0% |
|---|
| DealNet Capital Corp ($DLS) | 0.0% | 0.0% | 6.3% | 2.5% | 1.4% |
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% |
| Grenville Strategic Royalty Corp ($GRC) | -1.9% | -10.8% | -10.1% | -11.6% | 18.1% |
| IGM Financial Inc ($IGM) | 15.3% | 14.2% | 14.2% | 13.7% | 13.7% |
| Clairvest Group Inc ($CVG) | 7.6% | 8.6% | 12.3% | 11.5% | 12.8% |
| |
|---|
| Median (76 companies) | 4.9% | 4.8% | 4.6% | 4.8% | 4.8% |
|---|
| DealNet Capital Corp ($DLS) | | | -260.8% | -130.0% | -71.2% |
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 |
| IOU Financial Inc ($IOU) | | | 7.3x | | 31.7x |
| Gazit-Globe Ltd ($GZT) | 14.8x | 12.8x | 12.7x | 15.3x | 22.1x |
| Wall Financial Corp ($WFC) | | 3.4x | 19.9x | 4.6x | 20.1x |
| |
|---|
| Median (39 companies) | 2.8x | 5.2x | 4.8x | 4.2x | 5.6x |
|---|
