Information Services Corp revenue surged on 12.8% in 2016 while EBITDA Margin decreased on 3.5 pp from 36.1% to 32.7%
14.03.2017 • About Information Services Corp (
$ISV) • By InTwits
Information Services Corp reported 2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is declining: 32.7% in 2016 vs. 36.1% in 2015 vs. 39.6% in 2012
- Information Services Corp has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.8%. At the same time it's in pair with industry average of 7.1%.
- CAPEX is quite volatile: 0.85 in 2016, 1.8 in 2015, 1.5 in 2014, 0.46 in 2013, 2.4 in 2012
- The company has highly profitable business model: ROIC is at 27.6%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Information Services Corp ($ISV) key annual financial indicators
| mln. CAD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 75.216 | 79.131 | 80.459 | 78.318 | 88.375 | 12.8% |
| Gross Profit | 58.293 | 63.625 | 65.098 | 68.630 | 75.187 | 9.6% |
| EBITDA | 29.754 | 31.309 | 30.240 | 28.301 | 28.875 | 2.0% |
| Net Income | 21.240 | 76.981 | 18.360 | 15.917 | 15.503 | -2.6% |
Balance Sheet
|
|---|
| Cash | 21.138 | 27.614 | 33.581 | 36.571 | 33.683 | -7.9% |
| Short Term Debt | 9.935 | 0.000 | 0.000 | 1.500 | 1.500 | 0.0% |
| Long Term Debt | 0.000 | 9.935 | 9.935 | 23.060 | 21.935 | -4.9% |
Cash flow
|
|---|
| Capex | 2.396 | 0.461 | 1.474 | 1.790 | 0.851 | -52.5% |
Ratios
|
|---|
| Revenue growth | 6.2% | 5.2% | 1.7% | -2.7% | 12.8% | |
| EBITDA growth | 23.1% | 5.2% | -3.4% | -6.4% | 2.0% | |
| Gross Margin | 77.5% | 80.4% | 80.9% | 87.6% | 85.1% | -2.6% |
| EBITDA Margin | 39.6% | 39.6% | 37.6% | 36.1% | 32.7% | -3.5% |
| Net Income Margin | 28.2% | 97.3% | 22.8% | 20.3% | 17.5% | -2.8% |
| CAPEX, % of revenue | 3.2% | 0.6% | 1.8% | 2.3% | 1.0% | -1.3% |
| ROIC | 71.8% | 72.8% | 58.9% | 38.1% | 27.6% | -10.5% |
| ROE | 101.7% | 149.6% | 22.1% | 18.4% | 17.5% | -0.9% |
| Net Debt/EBITDA | -0.4x | -0.6x | -0.8x | -0.4x | -0.4x | 0.1x |
Information Services Corp ($ISV) key quoterly financial indicators
| mln. CAD | 16Q1 | 16Q2 | 16Q3 | 16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 20 | 25 | 23 | 21 | 22.5% | 23.0% | 16.4% | -6.1% |
| EBITDA | 5 | 10 | 8 | 6 | 35.3% | 21.5% | -3.6% | -27.4% |
| Net Income | 2 | 7 | 4 | 3 | 27.7% | 32.3% | -18.2% | -36.1% |
Balance Sheet
|
|---|
| Cash | 34 | 35 | 38 | 34 | -8.7% | -10.8% | -3.8% | -7.9% |
| Short Term Debt | 2 | 2 | 2 | 2 | | | | 0.0% |
| Long Term Debt | 23 | 22 | 22 | 22 | 128.3% | 124.6% | 120.8% | -4.9% |
Ratios
|
|---|
| Gross Margin | 82.9% | 86.0% | 86.1% | 84.9% | -1.4% | -1.6% | -2.6% | -4.2% |
| EBITDA Margin | 26.0% | 40.6% | 34.3% | 27.9% | 2.5% | -0.5% | -7.1% | -8.2% |
| Net Income Margin | 11.2% | 26.7% | 16.6% | 13.8% | 0.5% | 1.9% | -7.0% | -6.5% |
Revenue and profitability
Information Services Corp's Revenue surged on 12.8%. Revenue growth showed slow down in 16Q4 - it was -6.1% YoY. Despite revenue decline the EBITDA margin expanded. EBITDA Margin jumped on 111 pp from -69.8% to 41.6% in 2016.
Gross Margin decreased on 2.6 pp from 87.6% to 85.1% in 2016.
Net Income marign decreased on 2.8 pp from 20.3% to 17.5% in 2016.
Capital expenditures (CAPEX) and working capital investments
In 2016 Information Services Corp had CAPEX/Revenue of 0.96%. The company showed almost no change in CAPEX/Revenue from 2013 to 2016. It's average CAPEX/Revenue for the last three years was 1.7%.
Return on investment
The company operates at high and attractive ROIC (27.63%) while ROE is a bit lower (17.54%). ROIC dropped on 10.5 pp from 38.1% to 27.6% in 2016. ROE decreased slightly on 0.88 pp from 18.4% to 17.5% in 2016.
Leverage (Debt)
Debt level is -0.4x Net Debt / EBITDA and 0.8x Debt / EBITDA. Net Debt / EBITDA increased on 0.1x from -0.4x to -0.4x in 2016. Debt decreased on 4.6% while cash decreased on 7.9%.
Appendix 1: Peers in Consumer, Non-cyclical
Below you can find Information Services Corp benchmarking vs. other companies in Consumer, Non-cyclical industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by Revenue growth, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Concordia Healthcare Corp ($CXR) | | | 159.5% | 275.7% | 107.0% |
| Heritage Global Inc ($HGP) | | -37.0% | 76.2% | 11.2% | 80.8% |
| EnerCare Inc ($ECI) | | 8.6% | 21.1% | 55.7% | 76.6% |
| CRH Medical Corp ($CRH) | | 12.5% | 56.0% | 284.2% | 70.2% |
| Nuvo Research Inc ($NRI) | | -25.3% | -29.1% | 57.0% | 31.9% |
| |
|---|
| Median (40 companies) | | 9.1% | 13.9% | 15.6% | 12.6% |
|---|
| Information Services Corp ($ISV) | | 5.2% | 1.7% | -2.7% | 12.8% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Cipher Pharmaceuticals Inc ($CPH) | | 99.5% | 98.3% | 92.7% | |
| Ritchie Bros Auctioneers Inc ($RBA) | 88.7% | 88.4% | 88.0% | 89.1% | 88.3% |
| Biosyent Inc ($RX) | 79.3% | 79.2% | 78.1% | 78.7% | |
| Concordia Healthcare Corp ($CXR) | | 79.4% | 86.0% | 76.1% | 72.9% |
| Valeant Pharmaceuticals International Inc ($VRX) | 72.1% | 67.0% | 72.8% | 75.3% | 73.0% |
| |
|---|
| Median (34 companies) | 29.5% | 35.0% | 35.6% | 33.4% | 28.9% |
|---|
| Information Services Corp ($ISV) | 77.5% | 80.4% | 80.9% | 87.6% | 85.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| CRH Medical Corp ($CRH) | 21.0% | 24.5% | 29.1% | 44.1% | |
| Valeant Pharmaceuticals International Inc ($VRX) | 30.6% | 27.8% | 45.6% | 39.8% | 23.8% |
| Concordia Healthcare Corp ($CXR) | | 43.7% | 37.0% | 39.8% | -92.8% |
| Ritchie Bros Auctioneers Inc ($RBA) | 36.8% | 36.3% | 36.4% | 39.7% | 31.4% |
| EnerCare Inc ($ECI) | 52.8% | 51.0% | 45.5% | 39.3% | 26.6% |
| |
|---|
| Median (43 companies) | 9.1% | 12.0% | 12.7% | 11.0% | 10.0% |
|---|
| Information Services Corp ($ISV) | 39.6% | 39.6% | 37.6% | 36.1% | 32.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| ProMetic Life Sciences Inc ($PLI) | 2.1% | 33.6% | 34.6% | 23.3% | |
| EnerCare Inc ($ECI) | 25.7% | 26.5% | 23.6% | 20.7% | 15.5% |
| Black Diamond Group Ltd ($BDI) | 61.9% | 27.5% | 31.0% | 17.6% | |
| easyhome Ltd ($EH) | 32.2% | 25.6% | 21.6% | 16.9% | 12.7% |
| K-Bro Linen Inc ($KBL) | 10.0% | 19.0% | 11.4% | 16.6% | |
| |
|---|
| Median (42 companies) | 3.1% | 2.8% | 2.4% | 2.4% | 2.2% |
|---|
| Information Services Corp ($ISV) | 3.2% | 0.6% | 1.8% | 2.3% | 1.0% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Colliers International Group Inc ($CIG) | 10.5% | 11.2% | 15.2% | 10.9% | 26.1% |
| Nuvo Research Inc ($NRI) | -11.6% | -17.4% | -37.9% | 12.9% | 20.8% |
| International Road Dynamics Inc ($IRD) | 0.9% | 6.7% | 4.4% | 10.6% | 16.5% |
| Premium Brands Holdings Corp ($PBH) | 10.3% | 9.9% | 6.9% | 12.6% | 15.3% |
| easyhome Ltd ($EH) | | 14.6% | 14.4% | 14.7% | 14.9% |
| |
|---|
| Median (43 companies) | 8.6% | 7.5% | 8.4% | 6.3% | 8.0% |
|---|
| Information Services Corp ($ISV) | 71.8% | 72.8% | 58.9% | 38.1% | 27.6% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Concordia Healthcare Corp ($CXR) | | -1.3x | 5.6x | 20.2x | |
| SunOpta Inc ($SOY) | 2.9x | 3.5x | 1.3x | 16.9x | 140.8x |
| Centric Health Corp ($CHH) | 5.6x | 10.2x | 11.2x | 15.6x | |
| Sienna Senior Living Inc ($SIA) | 9.5x | 11.8x | 9.2x | 9.1x | 9.1x |
| Valeant Pharmaceuticals International Inc ($VRX) | 9.5x | 10.4x | 4.0x | 7.3x | 12.7x |
| |
|---|
| Median (37 companies) | 2.9x | 2.3x | 3.5x | 2.8x | 2.9x |
|---|
| Information Services Corp ($ISV) | -0.4x | -0.6x | -0.8x | -0.4x | -0.4x |
