Indigo Books & Music Inc EBITDA surged on 109% in 2016 and Revenue jumped on 11.0%
31.05.2016 • About Indigo Books & Music Inc (
$IDG) • By InTwits
Indigo Books & Music Inc reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is quite volatile: 4.4% in FY2016, 2.3% in FY2015, -0.3% in FY2014, 3.3% in FY2013, -0.3% in FY2012
- Indigo Books & Music Inc has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.6%. At the same time it's in pair with industry average of 45.3%.
- CAPEX is quite volatile: 341 in 2016, 516 in 2015, 908 in 2014, 561 in 2013, 559 in 2012
- The company has business model with low profitability: ROIC is at 7.1%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Indigo Books & Music Inc ($IDG) key annual financial indicators
| mln. CAD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 934.0 | 892.5 | 867.7 | 895.4 | 994.2 | 11.0% |
| Gross Profit | 389.1 | 391.8 | 373.7 | 392.3 | 443.0 | 12.9% |
| SG&A | | | 403.7 | 398.0 | 423.0 | 6.3% |
| EBITDA | -3.0 | 29.8 | -2.5 | 21.0 | 43.8 | 108.5% |
| Net Income | 92.7 | 4.3 | -31.0 | -3.5 | 28.6 | |
Balance Sheet
|
|---|
| Cash | 207.6 | 211.7 | 157.6 | 203.2 | 216.5 | 6.6% |
| Short Term Debt | 1.1 | 0.8 | 0.6 | 0.2 | 0.1 | -69.2% |
| Long Term Debt | 1.1 | 0.7 | 0.2 | 0.1 | 0.0 | -100.0% |
Cash flow
|
|---|
| Capex | 12.1 | 9.5 | 18.7 | 10.8 | 20.2 | 86.9% |
Ratios
|
|---|
| Revenue growth | -2.3% | -4.4% | -2.8% | 3.2% | 11.0% | |
| EBITDA growth | -105.8% | -1,100.7% | -108.4% | -939.9% | 108.5% | |
| Gross Margin | 41.7% | 43.9% | 43.1% | 43.8% | 44.6% | 0.7% |
| EBITDA Margin | -0.3% | 3.3% | -0.3% | 2.3% | 4.4% | 2.1% |
| Net Income Margin | 9.9% | 0.5% | -3.6% | -0.4% | 2.9% | 3.3% |
| SG&A, % of revenue | | | 46.5% | 44.5% | 42.6% | -1.9% |
| CAPEX, % of revenue | 1.3% | 1.1% | 2.2% | 1.2% | 2.0% | 0.8% |
| ROIC | -10.9% | 0.6% | -10.5% | -2.1% | 7.1% | 9.3% |
| ROE | 30.3% | 1.2% | -9.4% | -1.1% | 8.7% | 9.9% |
| Net Debt/EBITDA | | -7.1x | | -9.7x | -4.9x | 4.7x |
Indigo Books & Music Inc ($IDG) key quoterly financial indicators
| mln. CAD | FY16Q1 | FY16Q2 | FY16Q3 | FY16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 185 | 206 | 383 | 220 | 2.3% | 8.8% | 12.9% | 18.4% |
| EBITDA | -3 | 4 | 54 | -11 | | | 30.0% | |
| Net Income | -9 | -2 | 53 | -13 | | | 60.2% | |
Balance Sheet
|
|---|
| Cash | 177 | 176 | 312 | 216 | 17.3% | 17.9% | 8.7% | 6.6% |
| Short Term Debt | 0 | 0 | 0 | 0 | -67.7% | -64.6% | -55.1% | -69.2% |
| Long Term Debt | 0 | 0 | 0 | 0 | -81.4% | -84.2% | -90.4% | -100.0% |
Ratios
|
|---|
| Gross Margin | 44.0% | 45.5% | 44.1% | 44.9% | -0.2% | 1.4% | 0.6% | 1.2% |
| EBITDA Margin | -1.5% | 1.9% | 14.0% | -5.0% | 2.5% | 3.0% | 1.8% | 0.8% |
| Net Income Margin | -4.8% | -0.9% | 13.8% | -6.1% | 2.9% | 3.6% | 4.1% | 1.4% |
Revenue and profitability
The company's Revenue surged on 11.0%. Revenue growth showed acceleration in FY16Q4 - it increased 18.4% YoY. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin surged on 31.1 pp from 24.1% to 55.1% in 2016.
Gross Margin increased slightly on 0.74 pp from 43.8% to 44.6% in FY2016. SG&A as a % of Revenue decreased slightly on 1.9 pp from 44.5% to 42.6% in FY2016.
Net Income marign increased on 3.3 pp from -0.39% to 2.9% in FY2016.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 2.0% in FY2016. Indigo Books & Music Inc's CAPEX/Revenue increased slightly on 0.97 pp from 1.1% in FY2013 to 2.0% in FY2016. For the last three years the average CAPEX/Revenue was 1.8%.
Return on investment
The company operates at low ROIC (7.13%) and ROE (8.73%). ROIC increased on 9.3 pp from -2.1% to 7.1% in FY2016. ROE increased on 9.9 pp from -1.1% to 8.7% in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is -4.9x and Debt / EBITDA is 0.0x. Net Debt / EBITDA jumped on 4.7x from -9.7x to -4.9x in FY2016. Debt dropped on 76.8% while cash increased on 6.6%.
Appendix 1: Peers in Consumer, Cyclical
Below we provide Indigo Books & Music Inc benchmarking against other companies in Consumer, Cyclical 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 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| New Flyer Industries Inc ($NFI) | | 38.6% | 21.0% | 6.1% | 47.8% |
| Hardwoods Distribution Inc ($HWD) | | 21.3% | 22.8% | 25.4% | 38.1% |
| Spin Master Corp ($TOY) | | 21.5% | 41.0% | 22.9% | 31.3% |
| Great Canadian Gaming Corp ($GC) | | -0.3% | 9.6% | 3.7% | 22.4% |
| CanWel Building Materials Group Ltd ($CWX) | | 2.1% | 4.6% | 8.6% | 18.6% |
| |
|---|
| Median (36 companies) | | 4.9% | 6.9% | 6.8% | 5.0% |
|---|
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Innova Gaming Group Inc ($IGG) | 89.3% | 82.4% | 85.3% | 92.9% | 88.1% |
| Second Cup Ltd/The ($SCU) | 86.6% | 85.1% | 72.7% | 81.1% | |
| New Look Vision Group Inc ($BCI) | 71.8% | 72.6% | 72.6% | 78.7% | |
| Cara Operations Ltd ($CAO) | | 79.2% | 78.9% | 78.4% | |
| Canlan Ice Sports Corp ($ICE) | 71.6% | 69.7% | 70.7% | 78.2% | |
| |
|---|
| Median (37 companies) | 36.1% | 31.6% | 32.5% | 31.5% | 34.6% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Westshore Terminals Investment Corp ($WTE) | 49.7% | 65.9% | 60.9% | 59.6% | |
| Gamehost Inc ($GH) | 46.1% | 45.7% | 45.9% | 42.8% | 42.6% |
| Great Canadian Gaming Corp ($GC) | 16.8% | 41.1% | 40.1% | 36.6% | 34.4% |
| Restaurant Brands International Inc ($QSR) | | 51.1% | 20.8% | 33.9% | 44.4% |
| Cara Operations Ltd ($CAO) | | 9.6% | 22.6% | 32.6% | |
| |
|---|
| Median (39 companies) | 8.1% | 9.8% | 12.3% | 10.1% | 15.1% |
|---|
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Holloway Lodging Corp ($HLC) | 8.2% | 6.7% | 14.8% | 26.7% | 9.3% |
| WestJet Airlines Ltd ($WJA) | 7.9% | 19.5% | 18.6% | 22.5% | 22.4% |
| Westshore Terminals Investment Corp ($WTE) | 25.7% | 11.5% | 6.2% | 21.2% | |
| Innova Gaming Group Inc ($IGG) | 20.6% | 26.7% | 15.9% | 15.6% | 15.1% |
| Exchange Income Corp ($EIF) | 7.9% | 15.8% | 15.5% | 15.4% | 29.7% |
| |
|---|
| Median (42 companies) | 2.7% | 3.1% | 3.4% | 3.4% | 4.9% |
|---|
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Spin Master Corp ($TOY) | | 19.2% | 56.9% | 48.2% | 44.5% |
| Magna International Inc ($MG) | 16.3% | 18.6% | 25.2% | 21.9% | 21.2% |
| Linamar Corp ($LNR) | 12.9% | 17.0% | 21.7% | 23.7% | 19.8% |
| Sleep Country Canada Holdings Inc ($ZZZ) | | | 9.7% | 12.7% | 19.0% |
| Air Canada ($AC) | | 37.0% | 23.2% | 28.4% | 18.8% |
| |
|---|
| Median (42 companies) | 10.5% | 12.5% | 10.8% | 10.6% | 11.2% |
|---|
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Holloway Lodging Corp ($HLC) | | 5.8x | 8.4x | 17.1x | 8.6x |
| AutoCanada Inc ($ACQ) | 4.2x | 4.7x | 6.4x | 8.0x | 13.7x |
| Second Cup Ltd/The ($SCU) | 1.0x | 0.6x | 0.0x | 7.5x | 0.0x |
| Amaya Inc ($AYA) | 17.9x | 1.8x | 13.5x | 6.6x | 5.0x |
| Performance Sports Group Ltd ($PSG) | 2.6x | 3.5x | 12.2x | 6.5x | |
| |
|---|
| Median (35 companies) | 1.9x | 2.8x | 2.4x | 2.5x | 2.1x |
|---|
