Dq Entertainment (International) reports 146% Net Income decline and 40.6% Revenue decline
27-05-2015 • About Dq Entertainment (International) (
$DQE) • By InTwits
Dq Entertainment (International) reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Dq Entertainment (International) is a company in decline: FY2015 revenue growth was -40.6%, 5 years revenue CAGR was -2.5%
- Dq Entertainment (International) has high CAPEX intensity: 5 year average CAPEX/Revenue was 17.3%. At the same time it's a lot of higher than industry average of 3.0%.
- CAPEX is quite volatile: 8.1 in FY2015, 0.41 in FY2014, 46.8 in FY2013, 124 in FY2012, 1,635 in FY2011
- The company has potentially unprofitable business model: ROIC is at 3.4%
- It operates with high leverage: Net Debt/EBITDA is 5.0x while industry average is 1.4x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Dq Entertainment (International) ($DQE) key annual financial indicators
| mln. INR | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 2,078 | 2,272 | 2,294 | 2,397 | 1,423 | -40.6% |
| EBITDA | 756 | 949 | 1,120 | 963 | 719 | -25.3% |
| Net Income | 279 | 330 | 373 | 428 | -197 | -146.1% |
Balance Sheet
|
|---|
| Cash | 297 | 250 | 3 | 11 | 747 | 6,756.2% |
| Short Term Debt | 508 | 1,132 | 1,058 | 1,273 | 1,560 | 22.5% |
| Long Term Debt | 1,079 | 839 | 1,095 | 1,390 | 2,784 | 100.4% |
Cash flow
|
|---|
| Capex | 1,635 | 124 | 47 | 0 | 8 | 1,881.6% |
Ratios
|
|---|
| Revenue growth | 28.7% | 9.3% | 1.0% | 4.5% | -40.6% | |
| EBITDA growth | 20.1% | 25.6% | 18.1% | -14.0% | -25.3% | |
| EBITDA Margin | 36.4% | 41.8% | 48.8% | 40.2% | 50.5% | 10.3% |
| Net Income Margin | 13.4% | 14.5% | 16.3% | 17.8% | -13.8% | -31.7% |
| CAPEX, % of revenue | 78.6% | 5.5% | 2.0% | 0.0% | 0.6% | 0.6% |
| ROIC | 9.1% | 9.4% | 9.3% | 6.2% | 3.4% | -2.8% |
| ROE | 8.2% | 8.8% | 9.0% | 9.1% | -4.1% | -13.3% |
| Net Debt/EBITDA | 1.7x | 1.8x | 1.9x | 2.8x | 5.0x | 2.2x |
Revenue and profitability
Dq Entertainment (International)'s Revenue dropped on 40.6% in FY2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin jumped on 10.3 pp from 40.2% to 50.5% in FY2015.
Net Income marign dropped on 31.7 pp from 17.8% to -13.8% in FY2015.
Capital expenditures (CAPEX) and working capital investments
In FY2015 the company had CAPEX/Revenue of 0.57%. The company's CAPEX/Revenue decreased on 4.9 pp from 5.5% in FY2012 to 0.57% in FY2015. Average CAPEX/Revenue for the last three years was 0.88%.
Return on investment
The company operates at low but positive ROIC (3.35%) and negative ROE (-4.14%). ROIC decreased on 2.8 pp from 6.2% to 3.4% in FY2015. ROE dropped on 13.3 pp from 9.1% to -4.1% in FY2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 5.0x and Debt / EBITDA is 6.0x. Net Debt / EBITDA jumped on 2.2x from 2.8x to 5.0x in FY2015. Debt surged on 63.2% in FY2015 while cash surged on 6,756% in FY2015.
Appendix 1: Peers in Movies & Entertainment
Below we provide Dq Entertainment (International) benchmarking against other companies in Movies & Entertainment 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 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Shemaroo Entertainment ($SHEMAROO) | | 15.0% | 18.0% | 23.2% | 21.7% |
| Sri Adhikari Brothers Television Network ($SABTN) | -56.9% | 167.5% | 22.2% | 11.9% | |
| Prime Focus ($PFOCUS) | -72.5% | 53.5% | -1.3% | 10.8% | |
| Mukta Arts ($MUKTAARTS) | 47.0% | 5.0% | 22.4% | 8.2% | |
| Eros International Media ($EROSMEDIA) | -57.9% | 33.5% | 13.1% | 6.2% | |
| |
|---|
| Median (6 companies) | -57.4% | 16.9% | 17.0% | 9.5% | 21.7% |
|---|
| Dq Entertainment (International) ($DQE) | | 9.3% | 1.0% | 4.5% | -40.6% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Eros International Media ($EROSMEDIA) | 57.9% | 61.2% | 65.7% | 67.6% | |
| Sri Adhikari Brothers Television Network ($SABTN) | 2.1% | 7.5% | 24.7% | 27.5% | |
| Shemaroo Entertainment ($SHEMAROO) | 22.4% | 28.4% | 27.3% | 24.8% | 27.1% |
| Saregama India ($SAREGAMA) | 3.3% | 12.3% | 8.6% | 9.8% | |
| Mukta Arts ($MUKTAARTS) | 9.2% | 6.4% | 4.0% | 1.0% | |
| |
|---|
| Median (5 companies) | 9.2% | 15.0% | 24.8% | 24.8% | 14.8% |
|---|
| Dq Entertainment (International) ($DQE) | 36.4% | 41.8% | 48.8% | 40.2% | 50.5% |
Top companies by CAPEX/Revenue, %
| Top | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Sri Adhikari Brothers Television Network ($SABTN) | 119.1% | 28.9% | 5.1% | 9.4% | |
| Saregama India ($SAREGAMA) | 4.7% | 2.7% | 3.4% | 4.3% | |
| Shemaroo Entertainment ($SHEMAROO) | 1.2% | 2.3% | 0.9% | 0.7% | 0.7% |
| Eros International Media ($EROSMEDIA) | 77.5% | 56.1% | 0.1% | 0.0% | |
| |
|---|
| Median (4 companies) | 18.1% | 8.1% | 3.4% | 2.5% | 0.7% |
|---|
| Dq Entertainment (International) ($DQE) | 78.6% | 5.5% | 2.0% | 0.0% | 0.6% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Shemaroo Entertainment ($SHEMAROO) | 17.2% | 23.5% | 22.9% | 21.0% | 21.8% |
| Eros International Media ($EROSMEDIA) | 21.0% | 18.4% | 15.2% | 17.6% | |
| Picturehouse Media ($PICTUREHS) | 23.0% | 15.6% | 17.3% | 16.9% | |
| Sri Adhikari Brothers Television Network ($SABTN) | -4.8% | -4.4% | 7.1% | 10.6% | |
| Saregama India ($SAREGAMA) | -10.6% | 4.1% | 1.7% | 8.2% | |
| |
|---|
| Median (13 companies) | 13.4% | 2.1% | 7.3% | 10.6% | 21.8% |
|---|
| Dq Entertainment (International) ($DQE) | 9.1% | 9.4% | 9.3% | 6.2% | 3.4% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Picturehouse Media ($PICTUREHS) | -1.1x | 6.2x | 3.7x | 3.4x | |
| Sri Adhikari Brothers Television Network ($SABTN) | 112.5x | 16.1x | 3.5x | 2.5x | |
| Shemaroo Entertainment ($SHEMAROO) | 2.5x | 1.7x | 1.9x | 2.3x | 1.2x |
| Eros International Media ($EROSMEDIA) | 0.3x | 0.5x | 0.5x | 0.4x | |
| Saregama India ($SAREGAMA) | 10.1x | 2.4x | 3.1x | 0.2x | |
| |
|---|
| Median (7 companies) | 2.5x | 2.4x | 2.7x | 0.4x | 0.6x |
|---|
| Dq Entertainment (International) ($DQE) | 1.7x | 1.8x | 1.9x | 2.8x | 5.0x |
