Saregama India reports 64.2% Net Income decline while 5.1% Revenue growth
29-05-2015 • About Saregama India (
$SAREGAMA) • By InTwits
Saregama India reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is quite volatile: 6.5% in FY2015, 9.8% in FY2014, 8.6% in FY2013, 12.3% in FY2012, 3.3% in FY2011
- Saregama India has low CAPEX intensity: 5 year average CAPEX/Revenue was 3.4%. At the same time it's in pair with industry average of 15.8%.
- CAPEX is quite volatile: 35.3 in FY2015, 41.6 in FY2014, 181 in FY2013, 9.6 in FY2012, 14.6 in FY2011
- The company has potentially unprofitable business model: ROIC is at 3.4%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Saregama India ($SAREGAMA) key annual financial indicators
| mln. INR | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 1,370 | 1,602 | 1,860 | 1,775 | 1,865 | 5.1% |
| EBITDA | 45 | 197 | 159 | 174 | 121 | -30.4% |
| Net Income | -134 | 11 | 81 | 189 | 68 | -64.2% |
Balance Sheet
|
|---|
| Cash | 145 | 112 | 116 | 99 | 54 | -45.4% |
| Short Term Debt | 491 | 572 | 588 | 93 | 78 | -16.2% |
| Long Term Debt | 102 | 19 | 20 | 33 | 0 | -100.0% |
Cash flow
|
|---|
| Capex | 64 | 44 | 63 | 76 | 34 | -54.7% |
Ratios
|
|---|
| Revenue growth | -36.5% | 16.9% | 16.1% | -4.6% | 5.1% | |
| EBITDA growth | -145.8% | 341.2% | -18.9% | 9.1% | -30.4% | |
| EBITDA Margin | 3.3% | 12.3% | 8.6% | 9.8% | 6.5% | -3.3% |
| Net Income Margin | -9.7% | 0.7% | 4.4% | 10.7% | 3.6% | -7.0% |
| CAPEX, % of revenue | 4.7% | 2.7% | 3.4% | 4.3% | 1.8% | -2.4% |
| ROIC | -10.6% | 4.1% | 1.7% | 8.2% | 3.4% | -4.8% |
| ROE | -11.8% | 1.0% | 7.4% | 13.6% | 4.1% | -9.5% |
| Net Debt/EBITDA | 10.1x | 2.4x | 3.1x | 0.2x | 0.2x | 0.0x |
Revenue and profitability
The company's Revenue increased on 5.1% in FY2015. Revenue growth was financed by EBITDA margin decline. EBITDA Margin decreased on 3.3 pp from 9.8% to 6.5% in FY2015.
Net Income marign decreased on 7.0 pp from 10.7% to 3.6% in FY2015.
Capital expenditures (CAPEX) and working capital investments
Saregama India's CAPEX/Revenue was 1.8% in FY2015. Saregama India showed small CAPEX/Revenue decline of 0.88 pp from 2.7% in FY2012 to 1.8% in FY2015. Average CAPEX/Revenue for the last three years was 3.2%.
Return on investment
The company operates at low ROIC (3.38%) and ROE (4.06%). ROIC decreased on 4.8 pp from 8.2% to 3.4% in FY2015. ROE decreased on 9.5 pp from 13.6% to 4.1% in FY2015.
Leverage (Debt)
Debt level is 0.2x Net Debt / EBITDA and 0.6x Debt / EBITDA. Net Debt / EBITDA increased on 0.042x from 0.2x to 0.2x in FY2015. Debt dropped on 38.2% in FY2015 while cash dropped on 45.4% in FY2015.
Appendix 1: Peers in Movies & Entertainment
Below we provide Saregama India 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 |
|---|
| Eros International Media ($EROSMEDIA) | | 33.5% | 13.1% | 6.2% | 25.3% |
| Shemaroo Entertainment ($SHEMAROO) | | 15.0% | 18.0% | 23.2% | 21.7% |
| Dq Entertainment (International) ($DQE) | | 9.3% | 1.0% | 4.5% | -40.6% |
| Sri Adhikari Brothers Television Network ($SABTN) | | 167.5% | 22.2% | 11.9% | -42.6% |
| Mukta Arts ($MUKTAARTS) | | 5.0% | 22.4% | 8.2% | -58.4% |
| |
|---|
| Median (5 companies) | -86.1% | 15.0% | 15.6% | 9.5% | -40.6% |
|---|
| Saregama India ($SAREGAMA) | | 16.9% | 16.1% | -4.6% | 5.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Eros International Media ($EROSMEDIA) | 57.9% | 61.2% | 65.7% | 67.6% | 61.2% |
| Picturehouse Media ($PICTUREHS) | | | | | 54.1% |
| Dq Entertainment (International) ($DQE) | 36.4% | 41.8% | 48.8% | 40.2% | 50.5% |
| Sri Adhikari Brothers Television Network ($SABTN) | 2.1% | 7.5% | 24.7% | 27.5% | 43.7% |
| Mukta Arts ($MUKTAARTS) | 9.2% | 6.4% | 4.0% | 1.0% | 29.8% |
| |
|---|
| Median (8 companies) | 22.4% | 23.1% | 26.2% | 27.5% | 36.8% |
|---|
| Saregama India ($SAREGAMA) | 3.3% | 12.3% | 8.6% | 9.8% | 6.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Sri Adhikari Brothers Television Network ($SABTN) | 119.1% | 28.9% | 5.1% | 9.4% | 126.7% |
| Shemaroo Entertainment ($SHEMAROO) | 1.2% | 2.3% | 0.9% | 0.7% | 0.7% |
| Dq Entertainment (International) ($DQE) | 78.6% | 5.5% | 2.0% | 0.0% | 0.6% |
| Picturehouse Media ($PICTUREHS) | | | | | 0.5% |
| Eros International Media ($EROSMEDIA) | 77.5% | 56.1% | 0.1% | 0.0% | 0.2% |
| |
|---|
| Median (5 companies) | 45.2% | 8.1% | 2.0% | 0.4% | 0.6% |
|---|
| Saregama India ($SAREGAMA) | 4.7% | 2.7% | 3.4% | 4.3% | 1.8% |
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% | 17.7% |
| Picturehouse Media ($PICTUREHS) | 23.0% | 15.6% | 17.3% | 16.9% | 12.0% |
| Sri Adhikari Brothers Television Network ($SABTN) | -4.8% | -4.4% | 7.1% | 10.6% | 4.8% |
| Dq Entertainment (International) ($DQE) | 9.1% | 9.4% | 9.3% | 6.2% | 3.4% |
| |
|---|
| Median (13 companies) | 13.4% | 4.7% | 8.4% | 10.6% | 12.0% |
|---|
| Saregama India ($SAREGAMA) | -10.6% | 4.1% | 1.7% | 8.2% | 3.4% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Picturehouse Media ($PICTUREHS) | -1.1x | 6.2x | 3.7x | 3.4x | 7.0x |
| Dq Entertainment (International) ($DQE) | 1.7x | 1.8x | 1.9x | 2.8x | 5.0x |
| Sri Adhikari Brothers Television Network ($SABTN) | 112.5x | 16.1x | 3.5x | 2.5x | 3.0x |
| Shemaroo Entertainment ($SHEMAROO) | 2.5x | 1.7x | 1.9x | 2.3x | 1.2x |
| Eros International Media ($EROSMEDIA) | 0.3x | 0.5x | 0.5x | 0.4x | 0.4x |
| |
|---|
| Median (7 companies) | 2.1x | 1.9x | 2.1x | 2.3x | 1.2x |
|---|
| Saregama India ($SAREGAMA) | 10.1x | 2.4x | 3.1x | 0.2x | 0.2x |
