Ess Dee Aluminium reports 26.5% Net Income decline while 19.0% Revenue growth
27-05-2015 • About Ess Dee Aluminium (
$ESSDEE) • By InTwits
Ess Dee Aluminium reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Ess Dee Aluminium has high CAPEX intensity: 5 year average CAPEX/Revenue was 23.3%. At the same time it's a lot of higher than industry average of 11.7%.
- CAPEX is quite volatile: 207 in FY2015, 597 in FY2014, 378 in FY2013, 560 in FY2012, 437 in FY2011
- The company has business model with low profitability: ROIC is at 9.1%
- It operates with medium-size leverage: Net Debt/EBITDA is 2.9x while industry average is 2.8x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Ess Dee Aluminium ($ESSDEE) key annual financial indicators
| mln. INR | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 6,807 | 6,591 | 7,189 | 7,194 | 8,559 | 19.0% |
| EBITDA | 1,810 | 1,535 | 1,571 | 1,780 | 1,803 | 1.3% |
| Net Income | 1,180 | 680 | 734 | 509 | 374 | -26.5% |
Balance Sheet
|
|---|
| Cash | 88 | 216 | 34 | 51 | 73 | 41.3% |
| Short Term Debt | 1,330 | 2,661 | 2,302 | 2,754 | 3,813 | 38.5% |
| Long Term Debt | 809 | 855 | 1,575 | 1,972 | 1,438 | -27.1% |
Cash flow
|
|---|
| Capex | 1,578 | 1,273 | 1,210 | 2,534 | 1,898 | -25.1% |
Ratios
|
|---|
| Revenue growth | -33.8% | -3.2% | 9.1% | 0.1% | 19.0% | |
| EBITDA growth | 13.5% | -15.2% | 2.3% | 13.3% | 1.3% | |
| EBITDA Margin | 26.6% | 23.3% | 21.9% | 24.7% | 21.1% | -3.7% |
| Net Income Margin | 17.3% | 10.3% | 10.2% | 7.1% | 4.4% | -2.7% |
| CAPEX, % of revenue | 23.2% | 19.3% | 16.8% | 35.2% | 22.2% | -13.0% |
| ROIC | 21.7% | 11.4% | 9.9% | 10.2% | 9.1% | -1.0% |
| ROE | 19.6% | 9.3% | 9.3% | 6.0% | 4.2% | -1.8% |
| Net Debt/EBITDA | 1.1x | 2.2x | 2.4x | 2.6x | 2.9x | 0.2x |
Revenue and profitability
Ess Dee Aluminium's Revenue surged on 19.0% in FY2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 3.4 pp from 1.4% to 4.8% in FY2015.
Net Income marign decreased on 2.7 pp from 7.1% to 4.4% in FY2015.
Capital expenditures (CAPEX) and working capital investments
In FY2015 Ess Dee Aluminium had CAPEX/Revenue of 22.2%. Ess Dee Aluminium's CAPEX/Revenue increased on 2.9 pp from 19.3% in FY2012 to 22.2% in FY2015. It's average CAPEX/Revenue for the last three years was 24.7%.Ess Dee Aluminium has spent a lot to CAPEX (105% of EBITDA) to secure its growth.
Return on investment
The company operates at low ROIC (9.13%) and ROE (4.18%). ROIC decreased slightly on 1.0 pp from 10.2% to 9.1% in FY2015. ROE decreased slightly on 1.8 pp from 6.0% to 4.2% in FY2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 2.9x and Debt / EBITDA is 2.9x. Net Debt / EBITDA surged on 0.2x from 2.6x to 2.9x in FY2015. Debt jumped on 11.1% in FY2015 while cash jumped on 41.3% in FY2015.
Valuation
Ess Dee Aluminium's trades at EV/EBITDA 7.9x and P/E 24.2x while industy averages are 10.5x and 26.1x.
Appendix 1: Peers in Household Products
Below you can find Ess Dee Aluminium benchmarking vs. other companies in Household 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 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Jyothy Laboratories ($JYOTHYLAB) | | 47.3% | 21.0% | 19.4% | 14.2% |
| |
|---|
| Median (1 company) | | 47.3% | 21.0% | 19.4% | 14.2% |
|---|
| Ess Dee Aluminium ($ESSDEE) | | -3.2% | 9.1% | 0.1% | 19.0% |
Top companies by EBITDA margin, %
| Top | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Jyothy Laboratories ($JYOTHYLAB) | 13.7% | 9.5% | 11.9% | 11.9% | 12.8% |
| |
|---|
| Median (1 company) | 13.7% | 9.5% | 11.9% | 11.9% | 12.8% |
|---|
| Ess Dee Aluminium ($ESSDEE) | 26.6% | 23.3% | 21.9% | 24.7% | 21.1% |
Top companies by CAPEX/Revenue, %
| Top | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Jyothy Laboratories ($JYOTHYLAB) | 4.6% | 2.7% | 2.5% | 1.8% | 1.1% |
| |
|---|
| Median (1 company) | 4.6% | 2.7% | 2.5% | 1.8% | 1.1% |
|---|
| Ess Dee Aluminium ($ESSDEE) | 23.2% | 19.3% | 16.8% | 35.2% | 22.2% |
Top companies by ROIC, %
| Top | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Jyothy Laboratories ($JYOTHYLAB) | 12.6% | 6.5% | 8.7% | 10.3% | 12.1% |
| Hipolin ($HIPOLIN) | -3.3% | 2.2% | 3.3% | | |
| Pee Cee Cosma Sope ($PCCOSMA) | 0.6% | 6.7% | | | |
| |
|---|
| Median (3 companies) | 0.6% | 6.5% | 6.0% | 10.3% | 12.1% |
|---|
| Ess Dee Aluminium ($ESSDEE) | 21.7% | 11.4% | 9.9% | 10.2% | 9.1% |
Top companies by Net Debt / EBITDA
| Top | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Jyothy Laboratories ($JYOTHYLAB) | -2.5x | 5.7x | 4.7x | 3.2x | 2.8x |
| |
|---|
| Median (1 company) | 1.3x | 5.7x | 4.8x | 3.2x | 2.8x |
|---|
| Ess Dee Aluminium ($ESSDEE) | 1.1x | 2.2x | 2.4x | 2.6x | 2.9x |
