Relaxo Footwears EBITDA jumped on 20.3% and Revenue surged on 15.7%
14-05-2016 • About Relaxo Footwears (
$RELAXO) • By InTwits
Relaxo Footwears reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Relaxo Footwears is a fast growth stock: FY2016 revenue growth was 15.7%, 5 year revenue CAGR was 19.9% at FY2016 ROIC 28.1%
- Relaxo Footwears has medium CAPEX intensity: 5 year average CAPEX/Revenue was 7.3%. At the same time it's a lot of higher than industry average of 4.9%.
- CAPEX is quite volatile: ₹1,348m in FY2016, ₹1,313m in FY2015, ₹711m in FY2014, ₹838m in FY2013, ₹488m in FY2012
- The company has highly profitable business model: ROIC is 28.1%
- It operates with medium-size leverage: Net Debt/EBITDA is 1.0x while industry average is 1.1x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Relaxo Footwears's Revenue jumped on 15.7%. Revenue growth happened at the same time with EBITDA margin expansion. EBITDA Margin increased slightly on 0.54 pp from 13.6% to 14.1% in FY2016. EBITDA Margin grew at 0.85 pp per annum in the last 5 years.
Net Income margin showed almost no change in FY2016. Net Income margin stuck to a growing trend at 0.69 pp per annum in FY2012-FY2016.
Investments (CAPEX, working capital and M&A)
Relaxo Footwears's CAPEX/Revenue was 7.9% in FY2016. CAPEX/Revenue showed almost no change from FY2013 to FY2016. It's average CAPEX/Revenue for the last three years was 7.5%. To maintain its fast growth the company invested a large share of EBITDA (55.8%) to CAPEX.
Return on investment
The company operates at high and attractive ROIC (28.1%) and ROE (28.4%). ROIC showed almost no change in FY2016. ROE decreased on 3.6 pp from 32.0% to 28.4% in FY2016. ROIC grew at 2.2 pp per annum in FY2012-FY2016.
Leverage (Debt)
Debt level is 1.0x Net Debt / EBITDA and 1.0x Debt / EBITDA. Net Debt / EBITDA dropped on 0.2x from 1.2x to 1.0x in FY2016. Debt decreased slightly on 1.3% while cash dropped on 48.8%. Net Debt/EBITDA followed a declining trend at -0.3x per annum in the last 5 years.
Relaxo Footwears has short term refinancing risk: cash is only 1.8% of short term debt.
Financial and operational results
Relaxo Footwears ($RELAXO) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 8,647 | 10,098 | 12,123 | 14,808 | 17,130 | 15.7% |
| EBITDA | 968 | 1,098 | 1,478 | 2,008 | 2,415 | 20.3% |
| Net Income | 418 | 448 | 656 | 1,031 | 1,203 | 16.7% |
Balance Sheet
|
|---|
| Cash | 7 | 17 | 56 | 44 | 22 | -48.8% |
| Short Term Debt | 827 | 751 | 840 | 949 | 1,234 | 30.0% |
| Long Term Debt | 925 | 1,502 | 1,143 | 1,445 | 1,130 | -21.8% |
Cash flow
|
|---|
| Capex | 488 | 838 | 711 | 1,313 | 1,348 | 2.7% |
Ratios
|
|---|
| Revenue growth | 25.0% | 16.8% | 20.0% | 22.2% | 15.7% | |
| EBITDA growth | 33.8% | 13.5% | 34.6% | 35.8% | 20.3% | |
|
|---|
| EBITDA Margin | 11.2% | 10.9% | 12.2% | 13.6% | 14.1% | 0.5% |
| Net Income Margin | 4.8% | 4.4% | 5.4% | 7.0% | 7.0% | 0.1% |
| CAPEX, % of revenue | 5.6% | 8.3% | 5.9% | 8.9% | 7.9% | -1.0% |
|
|---|
| ROIC | 21.2% | 19.9% | 24.1% | 28.3% | 28.1% | -0.2% |
| ROE | 27.3% | 23.2% | 26.7% | 32.0% | 28.4% | -3.6% |
| Net Debt/EBITDA | 1.8x | 2.0x | 1.3x | 1.2x | 1.0x | -0.2x |
Peers in Footwear
Below you can find Relaxo Footwears benchmarking vs. other companies in Footwear 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 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Superhouse ($SUPERHOUSE) | 18.1% | 9.8% | 28.1% | 6.3% | - |
| |
|---|
| Median (1 company) | 18.1% | 9.8% | 28.1% | 6.3% | - |
|---|
| Relaxo Footwears ($RELAXO) | - | 16.8% | 20.0% | 22.2% | 15.7% |
Top companies by EBITDA margin, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Sreeleathers ($SREEL2) | - | - | - | 21.4% | - |
| Superhouse ($SUPERHOUSE) | 10.8% | 10.0% | 11.7% | 10.3% | - |
| |
|---|
| Median (2 companies) | 10.8% | 10.0% | 11.7% | 15.8% | - |
|---|
| Relaxo Footwears ($RELAXO) | 11.2% | 10.9% | 12.2% | 13.6% | 14.1% |
Top companies by CAPEX/Revenue, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Superhouse ($SUPERHOUSE) | 5.4% | 4.5% | 2.4% | 6.7% | - |
| Sreeleathers ($SREEL2) | - | - | - | 0.1% | - |
| |
|---|
| Median (2 companies) | 5.4% | 4.5% | 2.4% | 3.4% | - |
|---|
| Relaxo Footwears ($RELAXO) | 5.6% | 8.3% | 5.9% | 8.9% | 7.9% |
Top companies by ROIC, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Superhouse ($SUPERHOUSE) | 16.7% | 14.1% | 19.2% | 15.1% | - |
| Sreeleathers ($SREEL2) | - | - | 5.7% | 6.7% | - |
| Nb Footwear ($NBFOOT) | - | - | - | - | - |
| |
|---|
| Median (3 companies) | 16.7% | 14.1% | 12.5% | 10.9% | - |
|---|
| Relaxo Footwears ($RELAXO) | 21.2% | 19.9% | 24.1% | 28.3% | 28.1% |
Top companies by Net Debt / EBITDA
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Superhouse ($SUPERHOUSE) | 2.1x | 2.7x | 2.0x | 2.6x | - |
| Sreeleathers ($SREEL2) | - | -0.1x | -0.5x | -0.4x | - |
| |
|---|
| Median (2 companies) | 2.1x | 1.3x | 0.8x | 1.1x | - |
|---|
| Relaxo Footwears ($RELAXO) | 1.8x | 2.0x | 1.3x | 1.2x | 1.0x |
