Student Transportation Inc reports 100% CAPEX growth and 8.2% Revenue growth
14.09.2016 • About Student Transportation Inc (
$STB) • By InTwits
Student Transportation Inc reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Student Transportation Inc has medium CAPEX intensity: 5 year average CAPEX/Revenue was 9.6%. At the same time it's a lot of higher than industry average of 7.1%.
- CAPEX is quite volatile: 9.2 in 2016, 10.7 in 2015, 19.7 in 2014, 9.7 in 2013, 4.3 in 2012
- The company has potentially unprofitable business model: ROIC is at 5.2%
- It operates with high leverage: Net Debt/EBITDA is 3.5x while industry average is 2.2x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Student Transportation Inc ($STB) key annual financial indicators
| mln. $ | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 369.0 | 423.7 | 489.5 | 554.8 | 600.2 | 8.2% |
| Gross Profit | 57.2 | 62.6 | 66.4 | 127.2 | 142.5 | 12.0% |
| SG&A | | | | 54.7 | 61.9 | 13.1% |
| EBITDA | 55.7 | 63.0 | 65.8 | 68.3 | 74.8 | 9.5% |
| Net Income | 2.3 | 3.9 | 1.4 | 3.7 | 6.0 | 65.2% |
Balance Sheet
|
|---|
| Cash | 5.0 | 6.9 | 10.9 | 5.3 | 7.8 | 45.5% |
| Short Term Debt | 0.6 | 0.0 | 0.2 | 0.0 | 0.0 | |
| Long Term Debt | 215.4 | 220.2 | 273.9 | 204.9 | 272.8 | 33.1% |
Cash flow
|
|---|
| Capex | 48.6 | 41.8 | 37.8 | 33.5 | 67.0 | 100.2% |
Ratios
|
|---|
| Revenue growth | 20.9% | 14.8% | 15.5% | 13.3% | 8.2% | |
| EBITDA growth | 14.3% | 13.1% | 4.5% | 3.8% | 9.5% | |
| Gross Margin | 15.5% | 14.8% | 13.6% | 22.9% | 23.7% | 0.8% |
| EBITDA Margin | 15.1% | 14.9% | 13.4% | 12.3% | 12.5% | 0.1% |
| Net Income Margin | 0.6% | 0.9% | 0.3% | 0.7% | 1.0% | 0.3% |
| SG&A, % of revenue | | | | 9.9% | 10.3% | 0.4% |
| CAPEX, % of revenue | 13.2% | 9.9% | 7.7% | 6.0% | 11.2% | 5.1% |
| ROIC | 3.5% | 3.7% | 3.4% | 3.7% | 5.2% | 1.5% |
| ROE | 1.2% | 1.9% | 0.8% | 2.0% | 3.5% | 1.5% |
| Net Debt/EBITDA | 3.8x | 3.4x | 4.0x | 2.9x | 3.5x | 0.6x |
Student Transportation Inc ($STB) key quoterly financial indicators
| mln. $ | FY16Q1 | FY16Q2 | FY16Q3 | FY16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 93 | 167 | 173 | 166 | 5.5% | 6.3% | 10.8% | 9.0% |
| EBITDA | -7 | 27 | 27 | 27 | | 9.0% | 23.9% | 4.6% |
| Net Income | -10 | 6 | 4 | 6 | | 56.4% | 99.1% | -10.1% |
Balance Sheet
|
|---|
| Cash | 4 | 0 | 4 | 8 | 245.0% | -89.5% | -61.2% | 45.5% |
| Short Term Debt | 0 | 0 | 0 | 0 | | | | |
| Long Term Debt | 278 | 281 | 268 | 273 | -10.0% | -11.1% | 15.5% | 33.1% |
Ratios
|
|---|
| Gross Margin | 8.9% | 27.2% | 26.2% | 26.0% | -2.0% | 1.2% | 2.3% | 0.2% |
| EBITDA Margin | -7.2% | 16.2% | 15.8% | 16.3% | -2.1% | 0.4% | 1.7% | -0.7% |
| Net Income Margin | -10.2% | 3.3% | 2.2% | 3.8% | -0.3% | 1.1% | 1.0% | -0.8% |
Revenue and profitability
The company's Revenue increased on 8.2%. Revenue growth showed acceleration in FY16Q4 - it increased 9.0% YoY. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 23.4 pp from 2.6% to -20.8% in 2016.
Gross Margin increased slightly on 0.80 pp from 22.9% to 23.7% in FY2016. SG&A as a % of Revenue showed almost no change in FY2016.
Net Income marign showed almost no change in FY2016.
Capital expenditures (CAPEX) and working capital investments
Student Transportation Inc's CAPEX/Revenue was 11.2% in FY2016. CAPEX/Revenue increased slightly on 1.3 pp from 9.9% in FY2013 to 11.2% in FY2016. For the last three years the average CAPEX/Revenue was 8.3%.Student Transportation Inc maintained rich investment policy and has spent a big chunk of EBITDA (89.6%) to CAPEX.
Return on investment
The company operates at low ROIC (5.20%) and ROE (3.49%). ROIC increased slightly on 1.5 pp from 3.7% to 5.2% in FY2016. ROE increased slightly on 1.5 pp from 2.0% to 3.5% in FY2016.
Leverage (Debt)
Debt level is 3.5x Net Debt / EBITDA and 3.6x Debt / EBITDA. Net Debt / EBITDA surged on 0.6x from 2.9x to 3.5x in FY2016. Debt jumped on 33.1% while cash jumped on 45.5%.
Appendix 1: Peers in Industrial
Below we provide Student Transportation Inc benchmarking against other companies in Industrial 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 |
|---|
| Progressive Waste Solutions Ltd ($BIN) | | 16.1% | 7.8% | 1.8% | 59.4% |
| Baylin Technologies Inc ($BYL) | | 16.5% | -44.0% | -4.1% | 47.5% |
| CCL Industries Inc ($CCL.B) | | 44.4% | 36.8% | 17.5% | 30.8% |
| Stantec Inc ($STN) | | 17.9% | 13.3% | 14.4% | 30.5% |
| Avigilon Corp ($AVO) | | 72.6% | 41.9% | 17.7% | 22.2% |
| |
|---|
| Median (52 companies) | | 5.1% | 10.1% | 8.1% | 2.9% |
|---|
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Pure Technologies Ltd ($PUR) | 77.9% | 78.0% | 77.5% | 75.6% | |
| WSP Global Inc ($WSP) | 81.1% | 83.2% | 81.0% | 74.0% | 76.7% |
| Avigilon Corp ($AVO) | 49.3% | 54.2% | 56.6% | 57.4% | 52.0% |
| Stantec Inc ($STN) | 55.0% | 54.7% | 54.9% | 54.5% | 54.1% |
| IWG Technologies Inc ($IWG) | 53.3% | 54.0% | 49.0% | 47.8% | 54.9% |
| |
|---|
| Median (50 companies) | 23.6% | 23.4% | 21.7% | 21.7% | 22.2% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Canadian National Railway Co ($CNR) | 46.5% | 45.9% | 46.8% | 50.9% | 54.3% |
| Canadian Pacific Railway Ltd ($CP) | 26.1% | 32.4% | 43.7% | 48.9% | 51.6% |
| Badger Daylighting Ltd ($BAD) | 25.7% | 25.9% | 27.9% | 24.6% | 24.2% |
| IWG Technologies Inc ($IWG) | 12.7% | 25.5% | 20.0% | 24.0% | 26.9% |
| Winpak Ltd ($WPK) | 19.5% | 18.6% | 18.7% | 22.7% | 23.5% |
| |
|---|
| Median (54 companies) | 10.4% | 8.4% | 8.4% | 8.6% | 11.1% |
|---|
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Newalta Corp ($NAL) | 21.7% | 34.5% | 35.1% | 42.0% | 9.6% |
| Cargojet Inc ($CJT.A) | 7.0% | 6.3% | 54.1% | 41.3% | |
| Algoma Central Corp ($ALC) | 15.9% | 7.3% | 5.0% | 27.4% | 58.2% |
| Canadian Pacific Railway Ltd ($CP) | 20.2% | 20.2% | 21.9% | 22.7% | 19.0% |
| Canadian National Railway Co ($CNR) | 17.4% | 18.7% | 18.9% | 21.5% | 22.4% |
| |
|---|
| Median (55 companies) | 3.2% | 3.7% | 4.3% | 3.9% | 4.3% |
|---|
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| IBI Group Inc ($IBG) | 4.8% | -9.0% | 11.6% | 21.9% | 26.2% |
| IWG Technologies Inc ($IWG) | 17.0% | 36.3% | 23.4% | 27.2% | 25.7% |
| Winpak Ltd ($WPK) | 20.4% | 18.0% | 18.3% | 22.6% | 21.8% |
| Toromont Industries Ltd ($TIH) | 28.8% | 25.8% | 24.3% | 23.5% | 21.7% |
| Intertape Polymer Group Inc ($ITP) | 12.3% | 13.7% | 22.5% | 23.0% | 21.0% |
| |
|---|
| Median (56 companies) | 12.2% | 9.6% | 11.5% | 8.3% | 9.0% |
|---|
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Conifex Timber Inc ($CFF) | | 2.7x | 6.1x | 35.9x | 3.6x |
| Ag Growth International Inc ($AFN) | 2.9x | -0.1x | 2.1x | 14.1x | |
| Cargojet Inc ($CJT.A) | 1.5x | 1.5x | 31.5x | 12.9x | |
| Progressive Waste Solutions Ltd ($BIN) | 4.5x | 3.3x | 2.9x | 10.6x | 3.8x |
| Finning International Inc ($FTT) | 2.3x | 1.8x | 1.4x | 9.4x | 2.5x |
| |
|---|
| Median (50 companies) | 1.5x | 1.6x | 1.3x | 1.0x | 1.9x |
|---|
