Points International Ltd EBITDA dropped on 58.4% in 2016 and EBITDA Margin decreased on 2.3 pp from 3.7% to 1.4%
08.03.2017 • About Points International Ltd (
$PTS) • By InTwits
Points International Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Points International Ltd doesn't have a profitable business model yet: FY2016 ROIC is 0.1%
- EBITDA Margin is quite volatile: 1.4% in FY2016, 3.7% in FY2015, 3.5% in FY2014, 3.6% in FY2013, 4.5% in FY2012
- Points International Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.4%.
- The company has potentially unprofitable business model: ROIC is at 0.1%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Points International Ltd ($PTS) key annual financial indicators
| mln. $ | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 139.5 | 202.3 | 254.9 | 296.3 | 321.8 | 8.6% |
| Gross Profit | 25.7 | 29.8 | 37.4 | 42.6 | 43.3 | 1.8% |
| SG&A | | | | 1.7 | 2.2 | 30.3% |
| EBITDA | 6.3 | 7.4 | 9.0 | 11.0 | 4.6 | -58.4% |
| Net Income | 8.3 | 3.6 | 4.7 | 5.2 | -1.5 | -129.3% |
Balance Sheet
|
|---|
| Cash | 45.1 | 64.2 | 36.9 | 51.4 | 46.5 | -9.5% |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 1.1 | 1.0 | 0.8 | 0.6 | 1.4 | 118.1% |
Ratios
|
|---|
| Revenue growth | 13.5% | 45.1% | 26.0% | 16.2% | 8.6% | |
| EBITDA growth | 9.8% | 17.1% | 21.5% | 22.3% | -58.4% | |
| Gross Margin | 18.4% | 14.7% | 14.7% | 14.4% | 13.5% | -0.9% |
| EBITDA Margin | 4.5% | 3.6% | 3.5% | 3.7% | 1.4% | -2.3% |
| Net Income Margin | 5.9% | 1.8% | 1.8% | 1.7% | -0.5% | -2.2% |
| SG&A, % of revenue | | | | 0.6% | 0.7% | 0.1% |
| CAPEX, % of revenue | 0.8% | 0.5% | 0.3% | 0.2% | 0.4% | 0.2% |
| ROIC | 14.9% | 15.0% | 21.2% | 18.8% | 0.1% | -18.8% |
| ROE | 35.3% | 11.9% | 12.7% | 12.4% | -3.7% | -16.1% |
| Net Debt/EBITDA | -7.2x | -8.7x | -4.1x | -4.7x | -10.2x | -5.5x |
Points International Ltd ($PTS) key quoterly financial indicators
| mln. $ | FY16Q1 | FY16Q2 | FY16Q3 | FY16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 74 | 84 | 82 | 82 | 9.6% | 23.5% | 1.6% | 2.2% |
| EBITDA | 2 | 2 | 2 | -2 | -34.3% | -29.5% | -8.3% | -191.5% |
| Net Income | 1 | 1 | 0 | -4 | -47.9% | -45.9% | -56.4% | -482.3% |
Balance Sheet
|
|---|
| Cash | 46 | 55 | 48 | 46 | -0.9% | 36.6% | 23.1% | -9.5% |
| Short Term Debt | 0 | 0 | 0 | 0 | | | | |
| Long Term Debt | 0 | 0 | 0 | 0 | | | | |
Ratios
|
|---|
| Gross Margin | 13.8% | 13.3% | 12.2% | 14.5% | -3.0% | -3.4% | -0.2% | 2.2% |
| EBITDA Margin | 3.1% | 2.9% | 2.2% | -2.4% | -2.0% | -2.2% | -0.2% | -5.1% |
| Net Income Margin | 1.2% | 1.1% | 0.4% | -4.5% | -1.3% | -1.4% | -0.5% | -5.7% |
Revenue and profitability
The company's Revenue increased on 8.6%. Revenue growth showed slow down in FY16Q4 - it was 2.2% YoY. Revenue growth was financed by EBITDA margin decline. EBITDA Margin decreased on 2.3 pp from 3.7% to 1.4% in FY2016.
Gross Margin decreased slightly on 0.90 pp from 14.4% to 13.5% in FY2016. SG&A as a % of Revenue showed almost no change in FY2016.
Net Income marign decreased on 2.2 pp from 1.7% to -0.47% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 Points International Ltd had CAPEX/Revenue of 0.44%. Points International Ltd showed almost no change in CAPEX/Revenue from FY2013 to FY2016. For the last three years the average CAPEX/Revenue was 0.32%.
Return on investment
The company operates at low but positive ROIC (0.07%) and negative ROE (-3.67%). ROIC dropped on 18.8 pp from 18.8% to 0.074% in FY2016. ROE dropped on 16.1 pp from 12.4% to -3.7% in FY2016.
Leverage (Debt)
The company has no debt. Cash decreased on 9.5%.
Appendix 1: Peers in Communications
Below we provide Points International Ltd 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 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| AcuityAds Holding Inc ($AT) | | | | 51.6% | 91.4% |
| Shopify Inc ($SH) | | 111.9% | 109.0% | 95.4% | 89.7% |
| Gaming Nation Inc ($FAN) | | | | | 46.6% |
| Tucows Inc ($TC) | | 13.3% | 13.6% | 17.1% | 9.8% |
| AgJunction Inc ($AJX) | | 5.0% | -23.0% | -12.9% | 8.2% |
| |
|---|
| Median (25 companies) | 13.1% | 2.6% | 1.1% | 3.2% | 2.1% |
|---|
| Points International Ltd ($PTS) | | 45.1% | 26.0% | 16.2% | 8.6% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Wanted Technologies Corp ($WAN) | 90.5% | 93.2% | 94.3% | 95.6% | |
| NeuLion Inc ($NLN) | 53.6% | 63.8% | 70.2% | 81.1% | 81.6% |
| TeraGo Inc ($TGO) | 62.9% | 61.8% | 59.8% | 77.2% | 77.2% |
| ICTV Brands Inc ($ITV) | 67.4% | 71.9% | 69.6% | 68.1% | |
| Platinum Communications Corp ($PCS) | 67.4% | 67.1% | 60.2% | 60.5% | |
| |
|---|
| Median (22 companies) | 46.4% | 43.3% | 49.1% | 48.2% | 44.6% |
|---|
| Points International Ltd ($PTS) | 18.4% | 14.7% | 14.7% | 14.4% | 13.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| BCE Inc ($BCE) | 38.8% | 37.7% | 38.4% | 37.7% | 39.8% |
| Rogers Communications Inc ($RCI.A) | 37.3% | 38.4% | 37.9% | 36.9% | 32.5% |
| Quebecor Inc ($QBR.B) | 27.5% | 36.3% | 35.5% | 34.2% | 35.5% |
| TELUS Corp ($T) | 35.3% | 35.2% | 35.1% | 34.1% | 33.0% |
| ZoomerMedia Ltd ($ZUM) | 32.6% | 33.8% | 29.3% | 29.1% | 27.1% |
| |
|---|
| Median (29 companies) | 19.1% | 13.7% | 11.0% | 10.4% | 8.2% |
|---|
| Points International Ltd ($PTS) | 4.5% | 3.6% | 3.5% | 3.7% | 1.4% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| TELUS Corp ($T) | 17.9% | 17.8% | 19.8% | 20.2% | 21.5% |
| Rogers Communications Inc ($RCI.A) | 17.2% | 17.6% | 18.4% | 18.2% | 17.2% |
| Quebecor Inc ($QBR.B) | 16.7% | 15.4% | 17.9% | 17.5% | 17.6% |
| BCE Inc ($BCE) | 17.6% | 17.5% | 17.7% | 16.9% | 17.4% |
| TeraGo Inc ($TGO) | 20.9% | 21.5% | 23.1% | 14.8% | 13.0% |
| |
|---|
| Median (28 companies) | 2.8% | 3.2% | 2.4% | 3.1% | 3.6% |
|---|
| Points International Ltd ($PTS) | 0.8% | 0.5% | 0.3% | 0.2% | 0.4% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Tucows Inc ($TC) | 17.7% | 22.5% | 35.4% | 51.4% | 58.4% |
| BCE Inc ($BCE) | 14.1% | 12.6% | 12.6% | 12.3% | 12.6% |
| Quebecor Inc ($QBR.B) | 7.9% | 9.6% | 8.4% | 8.4% | 10.1% |
| MDC Partners Inc ($MDZ.A) | -3.1% | -6.3% | 14.2% | 13.7% | 10.1% |
| TELUS Corp ($T) | 12.4% | 13.0% | 13.0% | 11.5% | 9.6% |
| |
|---|
| Median (28 companies) | 8.0% | 7.7% | 7.1% | 2.0% | 2.0% |
|---|
| Points International Ltd ($PTS) | 14.9% | 15.0% | 21.2% | 18.8% | 0.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Intertain Group Ltd/The ($IT) | | | | 9.4x | |
| MDC Partners Inc ($MDZ.A) | 12.4x | 112.6x | 4.6x | 5.5x | 9.6x |
| Quebecor Inc ($QBR.B) | 3.7x | 3.9x | 4.2x | 4.8x | 4.3x |
| Rogers Communications Inc ($RCI.A) | 2.3x | 2.4x | 3.2x | 3.6x | 3.8x |
| Newfoundland Capital Corp Ltd ($NCC.B) | 1.4x | 1.3x | 3.3x | 3.2x | |
| |
|---|
| Median (20 companies) | 1.4x | 1.3x | 1.5x | 1.8x | 1.9x |
|---|
| Points International Ltd ($PTS) | -7.2x | -8.7x | -4.1x | -4.7x | -10.2x |
