Responsive Industries reports 19.2% revenue decline in FY2015 and 1.9 pp EBITDA Margin growth from 10.3% to 12.2%
26-05-2015 • About Responsive Industries (
$RESPONIND) • By InTwits
Responsive Industries reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Responsive Industries is a company in decline: FY2015 revenue growth was -19.2%, 5 years revenue CAGR was -3.8%
- Responsive Industries has high CAPEX intensity: 5 year average CAPEX/Revenue was 10.9%. At the same time it's a lot of higher than industry average of 8.6%.
- CAPEX is quite volatile: 781 in FY2015, 1,733 in FY2014, 2,247 in FY2013, 2,466 in FY2012, 2,209 in FY2011
- The company has potentially unprofitable business model: ROIC is at 4.8%
- It operates with high leverage: Net Debt/EBITDA is 1.9x while industry average is 1.2x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Responsive Industries ($RESPONIND) key annual financial indicators
| mln. INR | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 11,787 | 16,822 | 21,771 | 25,154 | 20,336 | -19.2% |
| SG&A | | | | | 275 | |
| EBITDA | 1,817 | 2,259 | 2,509 | 2,585 | 2,474 | -4.3% |
| Net Income | 906 | 1,040 | 810 | 726 | 493 | -32.1% |
Balance Sheet
|
|---|
| Cash | 128 | 139 | 188 | 1,746 | 692 | -60.4% |
| Short Term Debt | 2,262 | 2,948 | 2,977 | 4,559 | 2,657 | -41.7% |
| Long Term Debt | 1,242 | 4,689 | 4,554 | 3,434 | 2,845 | -17.2% |
Cash flow
|
|---|
| Capex | 2,209 | 2,466 | 2,247 | 1,733 | 781 | -54.9% |
Ratios
|
|---|
| Revenue growth | -52.3% | 42.7% | 29.4% | 15.5% | -19.2% | |
| EBITDA growth | 40.4% | 24.4% | 11.1% | 3.0% | -4.3% | |
| EBITDA Margin | 15.4% | 13.4% | 11.5% | 10.3% | 12.2% | 1.9% |
| Net Income Margin | 7.7% | 6.2% | 3.7% | 2.9% | 2.4% | -0.5% |
| SG&A, % of revenue | | | | | 1.4% | 1.4% |
| CAPEX, % of revenue | 18.7% | 14.7% | 10.3% | 6.9% | 3.8% | -3.0% |
| ROIC | 17.3% | 13.0% | 9.0% | 6.9% | 4.8% | -2.1% |
| ROE | 23.9% | 20.8% | 13.7% | 10.4% | 6.1% | -4.3% |
| Net Debt/EBITDA | 1.9x | 3.3x | 2.9x | 2.4x | 1.9x | -0.5x |
Revenue and profitability
Responsive Industries's Revenue dropped on 19.2% in FY2015. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased slightly on 1.9 pp from 10.3% to 12.2% in FY2015.
Net Income marign showed almost no change in FY2015.
Capital expenditures (CAPEX) and working capital investments
In FY2015 the company had CAPEX/Revenue of 3.8%. The company showed big decline in CAPEX/Revenue of 10.8 pp from 14.7% in FY2012 to 3.8% in FY2015. For the last three years the average CAPEX/Revenue was 7.0%.
Return on investment
The company operates at low ROIC (4.75%) and ROE (6.13%). ROIC decreased on 2.1 pp from 6.9% to 4.8% in FY2015. ROE decreased on 4.3 pp from 10.4% to 6.1% in FY2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 1.9x and Debt / EBITDA is 2.2x. Net Debt / EBITDA dropped on 0.5x from 2.4x to 1.9x in FY2015. Debt dropped on 31.2% in FY2015 while cash dropped on 60.4% in FY2015.
Valuation
Responsive Industries's trades at EV/EBITDA 14.9x and P/E 65.1x while industy averages are 10.5x and 26.1x. The company's EV/(EBITDA-CAPEX) is 21.8x with the industry average at 4.7x.
Appendix 1: Peers in Plastic Products
Below you can find Responsive Industries benchmarking vs. other companies in Plastic Products 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 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Acrysil ($ACRYSIL) | | 11.3% | 29.6% | 33.8% | 19.4% |
| Astral Poly Technik ($ASTRAL) | 41.6% | 41.7% | 41.6% | 30.8% | |
| Shaily Engineering Plastics ($SHAILY) | | 14.9% | -16.0% | 23.3% | 19.2% |
| Wim Plast ($WIMPLAST) | | 27.5% | 23.1% | 19.5% | 23.5% |
| Jain Irrigation Systems ($JISLJALEQS) | | 20.9% | 2.1% | 16.1% | 5.6% |
| |
|---|
| Median (11 companies) | -51.4% | 15.3% | 23.4% | 12.6% | 8.5% |
|---|
| Responsive Industries ($RESPONIND) | | 42.7% | 29.4% | 15.5% | -19.2% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Acrysil ($ACRYSIL) | 19.2% | 12.4% | 16.8% | 17.5% | 19.5% |
| Wim Plast ($WIMPLAST) | 18.5% | 18.1% | 17.9% | 18.1% | 17.0% |
| Shaily Engineering Plastics ($SHAILY) | 11.5% | 14.3% | 13.9% | 16.0% | 14.8% |
| Jain Irrigation Systems ($JISLJALEQS) | 18.6% | 16.6% | 12.6% | 12.6% | 12.4% |
| Bloom Dekor ($BLOOM) | | | | | 11.8% |
| |
|---|
| Median (8 companies) | 11.1% | 11.7% | 11.8% | 12.6% | 12.1% |
|---|
| Responsive Industries ($RESPONIND) | 15.4% | 13.4% | 11.5% | 10.3% | 12.2% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Flexituff International ($FLEXITUFF) | 11.0% | 10.8% | 10.3% | 15.7% | |
| Shaily Engineering Plastics ($SHAILY) | 1.9% | 3.7% | | 10.7% | 17.2% |
| Acrysil ($ACRYSIL) | 21.2% | 7.8% | 11.0% | 9.6% | 9.3% |
| Astral Poly Technik ($ASTRAL) | 9.3% | 11.9% | 8.4% | 8.6% | |
| Jain Irrigation Systems ($JISLJALEQS) | 12.2% | 10.9% | 6.0% | 5.7% | 3.6% |
| |
|---|
| Median (7 companies) | 5.4% | 7.8% | 8.1% | 8.6% | 8.6% |
|---|
| Responsive Industries ($RESPONIND) | 18.7% | 14.7% | 10.3% | 6.9% | 3.8% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Astral Poly Technik ($ASTRAL) | 22.6% | 29.3% | 31.1% | 33.3% | |
| Wim Plast ($WIMPLAST) | 31.0% | 31.8% | 31.2% | 31.0% | 31.2% |
| Acrysil ($ACRYSIL) | | 7.7% | 16.2% | 20.2% | 21.0% |
| Shaily Engineering Plastics ($SHAILY) | 12.1% | 19.5% | 15.0% | 19.3% | 15.2% |
| Flexituff International ($FLEXITUFF) | 14.7% | 18.6% | 15.9% | 11.0% | |
| |
|---|
| Median (21 companies) | 12.1% | 10.0% | 11.8% | 19.3% | 18.1% |
|---|
| Responsive Industries ($RESPONIND) | 17.3% | 13.0% | 9.0% | 6.9% | 4.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Jain Irrigation Systems ($JISLJALEQS) | 3.4x | 3.8x | 5.1x | 4.8x | 4.8x |
| Flexituff International ($FLEXITUFF) | 3.5x | 2.2x | 3.1x | 4.3x | |
| Acrysil ($ACRYSIL) | 1.9x | 2.9x | 2.2x | 2.0x | 2.7x |
| Shaily Engineering Plastics ($SHAILY) | 4.0x | 1.9x | 1.8x | 1.9x | 2.6x |
| Astral Poly Technik ($ASTRAL) | 0.4x | 1.0x | 0.7x | 0.9x | |
| |
|---|
| Median (12 companies) | 2.4x | 2.1x | 2.2x | 0.4x | 0.0x |
|---|
| Responsive Industries ($RESPONIND) | 1.9x | 3.3x | 2.9x | 2.4x | 1.9x |
