United Breweries reports 17.1% EBITDA growth in 2016 and 8.3% Revenue growth
14-05-2016 • About United Breweries (
$UBL) • By InTwits
United Breweries reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- United Breweries is a growth stock: FY2016 revenue growth was 8.3%, 5 year revenue CAGR was 10.7% at FY2016 ROIC 17.1%
- United Breweries has medium CAPEX intensity: 5 year average CAPEX/Revenue was 7.8%. At the same time it's a lot of higher than industry average of 5.9%.
- CAPEX is quite volatile: ₹2,043m in FY2016, ₹4,099m in FY2015, ₹1,895m in FY2014, ₹1,081m in FY2013, ₹1,630m in FY2012
- The company has highly profitable business model: ROIC is 17.1%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
United Breweries's Revenue increased on 8.3%. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased on 2.7 pp from 15.1% to 17.8% in FY2016.
Net Income margin showed almost no change in FY2016.
Investments (CAPEX, working capital and M&A)
In FY2016 United Breweries had CAPEX/Revenue of 4.8%. CAPEX/Revenue decreased on 5.0 pp from 9.8% in FY2013 to 4.8% in FY2016. For the last three years the average CAPEX/Revenue was 6.2%.
Return on investment
The company operates at good ROIC (17.1%) and ROE (14.9%). ROIC increased on 2.8 pp from 14.3% to 17.1% in FY2016. ROE showed almost no change in FY2016.
Leverage (Debt)
Debt level is 0.9x Net Debt / EBITDA and 0.9x Debt / EBITDA. Net Debt / EBITDA dropped on 0.4x from 1.3x to 0.9x in FY2016. Debt dropped on 18.0% while cash increased on 5.9%. During FY2012-FY2016 Net Debt/EBITDA topped in FY2014 at 2.7x and was declining since that time.
United Breweries has short term refinancing risk: cash is only 2.8% of short term debt.
Financial and operational results
United Breweries ($UBL) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 35,593 | 38,987 | 42,297 | 46,881 | 50,758 | 8.3% |
| SG&A | | | | | 10,975 | |
| EBITDA | 4,143 | 4,793 | 4,373 | 6,221 | 7,285 | 17.1% |
| Net Income | 1,268 | 1,721 | 753 | 2,598 | 2,951 | 13.6% |
Balance Sheet
|
|---|
| Cash | 1,708 | 1,068 | 413 | 131 | 139 | 5.9% |
| Short Term Debt | 5,888 | 5,578 | 7,046 | 3,248 | 4,880 | 50.2% |
| Long Term Debt | 4,028 | 7,432 | 5,276 | 5,116 | 1,982 | -61.3% |
Cash flow
|
|---|
| Capex | 3,814 | 3,801 | 2,121 | 4,075 | 2,436 | -40.2% |
Ratios
|
|---|
| Revenue growth | 16.3% | 9.5% | 8.5% | 10.8% | 8.3% | |
| EBITDA growth | 6.1% | 15.7% | -8.8% | 42.3% | 17.1% | |
|
|---|
| EBITDA Margin | 11.6% | 12.3% | 10.3% | 13.3% | 14.4% | 1.1% |
| SG&A, % of revenue | | | | | 21.6% | |
| Net Income Margin | 3.6% | 4.4% | 1.8% | 5.5% | 5.8% | 0.3% |
| CAPEX, % of revenue | 10.7% | 9.8% | 5.0% | 8.7% | 4.8% | -3.9% |
|
|---|
| ROIC | 11.5% | 11.6% | 8.1% | 14.3% | 17.1% | 2.8% |
| ROE | 10.6% | 12.4% | 4.7% | 14.8% | 14.9% | 0.1% |
| Net Debt/EBITDA | 2.0x | 2.5x | 2.7x | 1.3x | 0.9x | -0.4x |
Peers in Breweries & Distilleries
Below you can find United Breweries benchmarking vs. other companies in Breweries & Distilleries 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 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Ifb Agro Industries ($IFBAGRO) | - | 5.4% | 8.4% | 19.2% | 4.8% |
| Pioneer Distilleries ($PIONDIST) | 94.2% | -0.9% | 25.1% | 17.0% | - |
| Som Distilleries & Breweries ($SDBL) | 11.0% | 5.0% | -6.5% | 8.3% | - |
| G.M.Breweries ($GMBREW) | - | 12.0% | 0.3% | 6.5% | 17.0% |
| Khoday India ($KHODAY) | 19.9% | -24.7% | 34.3% | -5.6% | - |
| |
|---|
| Median (7 companies) | 19.9% | 5.4% | 8.4% | 6.5% | 10.9% |
|---|
| United Breweries ($UBL) | - | 9.5% | 8.5% | 10.8% | 8.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Pioneer Distilleries ($PIONDIST) | -3.0% | -7.5% | 6.6% | 19.5% | - |
| Tilaknagar Industries ($TI) | 26.2% | 22.7% | 21.0% | 15.0% | - |
| Som Distilleries & Breweries ($SDBL) | 14.4% | 15.0% | 15.0% | 14.9% | - |
| G.M.Breweries ($GMBREW) | 10.0% | 9.1% | 13.7% | 11.5% | 23.8% |
| United Spirits ($UNITDSPR) | 12.2% | 12.6% | -1.3% | 6.1% | - |
| |
|---|
| Median (10 companies) | 12.2% | 10.8% | 13.7% | 5.6% | 15.5% |
|---|
| United Breweries ($UBL) | 11.6% | 12.3% | 10.3% | 13.3% | 14.4% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Tilaknagar Industries ($TI) | 20.6% | 10.0% | 14.8% | 13.7% | - |
| Pioneer Distilleries ($PIONDIST) | 29.8% | 35.0% | 30.0% | 12.3% | - |
| Ifb Agro Industries ($IFBAGRO) | 4.6% | 1.8% | 9.8% | 4.5% | 7.4% |
| United Spirits ($UNITDSPR) | 7.4% | 2.8% | 2.2% | 1.8% | - |
| Som Distilleries & Breweries ($SDBL) | 12.3% | 3.3% | 0.9% | 1.5% | - |
| |
|---|
| Median (6 companies) | 7.4% | 4.5% | 6.0% | 3.1% | 3.7% |
|---|
| United Breweries ($UBL) | 10.7% | 9.8% | 5.0% | 8.7% | 4.8% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Pioneer Distilleries ($PIONDIST) | -12.3% | -17.4% | -3.3% | 70.5% | - |
| G.M.Breweries ($GMBREW) | 18.4% | 17.0% | 21.9% | 18.0% | 46.7% |
| Som Distilleries & Breweries ($SDBL) | 23.3% | 22.2% | 19.2% | 16.5% | - |
| Ifb Agro Industries ($IFBAGRO) | 33.3% | 26.7% | 18.8% | 4.8% | 8.0% |
| Tilaknagar Industries ($TI) | 11.6% | 11.7% | 10.7% | 4.6% | - |
| |
|---|
| Median (11 companies) | 15.0% | 8.7% | 10.7% | 10.6% | 27.4% |
|---|
| United Breweries ($UBL) | 11.5% | 11.6% | 8.1% | 14.3% | 17.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| United Spirits ($UNITDSPR) | 7.3x | 6.1x | - | 8.4x | - |
| Tilaknagar Industries ($TI) | 4.3x | 3.8x | 4.8x | 8.4x | - |
| Pioneer Distilleries ($PIONDIST) | - | - | 10.4x | 2.1x | - |
| Som Distilleries & Breweries ($SDBL) | 0.5x | -0.1x | -0.0x | 0.7x | - |
| G.M.Breweries ($GMBREW) | 0.9x | 0.7x | 0.6x | 0.5x | -0.4x |
| |
|---|
| Median (7 companies) | 2.5x | 1.1x | 0.6x | 0.7x | 0.2x |
|---|
| United Breweries ($UBL) | 2.0x | 2.5x | 2.7x | 1.3x | 0.9x |
