Cox & Kings reports 76.6% CAPEX growth in 2016 while 8.7% Revenue decline
20-05-2016 • About Cox & Kings (
$COX&KINGS) • By InTwits
Cox & Kings reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Cox & Kings has high CAPEX intensity: 5 year average CAPEX/Revenue was 11.9%. At the same time it's in pair with industry average of 13.6%
- CAPEX is quite volatile: ₹3,202m in FY2016, ₹1,813m in FY2015, ₹2,841m in FY2014, ₹1,695m in FY2013, ₹1,434m in FY2012
- The company has business model with low profitability: ROIC is 9.8%
- It operates with high leverage: Net Debt/EBITDA is 2.6x while industry average is 1.3x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue decreased on 8.7%. During FY2012-FY2016 Revenue growth topped in FY2013 at 116% and was decelerating since that time. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 2.5 pp from 39.5% to 37.0% in FY2016.
Net Income margin decreased slightly on 1.3 pp from 3.6% to 2.3% in FY2016. During FY2012-FY2016 Net Income margin topped in FY2014 at 16.6% and was declining since that time.
Investments (CAPEX, working capital and M&A)
In FY2016 Cox & Kings had CAPEX/Revenue of 13.6%. CAPEX/Revenue increased on 4.3 pp from 9.4% in FY2013 to 13.6% in FY2016. For the last three years the average CAPEX/Revenue was 11.0%.
Return on investment
The company operates at low ROIC (9.8%) and ROE (2.1%). ROIC decreased slightly on 0.77 pp from 10.6% to 9.8% in FY2016. ROE decreased on 2.1 pp from 4.2% to 2.1% in FY2016. During FY2012-FY2016 ROIC topped in FY2015 at 10.6%. During FY2012-FY2016 ROE topped in FY2014 at 24.9% and was declining since that time.
Leverage (Debt)
Company's Net Debt / EBITDA is 2.6x and Debt / EBITDA is 4.7x. Net Debt / EBITDA decreased on 0.023x from 2.6x to 2.6x in FY2016. Debt increased on 8.5% while cash surged on 66.8%.
Cox & Kings has no short term refinancing risk: cash is higher than short term debt (143.2%).
Valuation and dividends
Cox & Kings's trades at EV/EBITDA 6.0x and P/E 54.6x while industy averages are 17.8x and 21.9x. Cox & Kings's EV/(EBITDA-CAPEX) is 9.5x with the industry average at 22.8x.
Management team
Anil Khandelwal is a the company's CFO. Anil Khandelwal has spent 12 years at the company.
Financial and operational results
Cox & Kings ($COX&KINGS) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 8,379 | 18,087 | 23,076 | 25,691 | 23,467 | -8.7% |
| SG&A | | | | | 1,644 | |
| EBITDA | 1,686 | 7,235 | 8,928 | 10,147 | 8,673 | -14.5% |
| Net Income | 416 | 2,484 | 3,832 | 918 | 539 | -41.2% |
Balance Sheet
|
|---|
| Cash | 10,496 | 12,608 | 9,623 | 10,948 | 18,258 | 66.8% |
| Short Term Debt | 12,107 | 7,581 | 8,442 | 4,740 | 12,750 | 169.0% |
| Long Term Debt | 34,512 | 39,182 | 47,395 | 33,065 | 28,260 | -14.5% |
Cash flow
|
|---|
| Capex | 1,434 | 1,695 | 2,841 | 1,813 | 3,202 | 76.6% |
Ratios
|
|---|
| Revenue growth | 68.7% | 115.9% | 27.6% | 11.3% | -8.7% | |
| EBITDA growth | -26.9% | 329.2% | 23.4% | 13.7% | -14.5% | |
|
|---|
| EBITDA Margin | 20.1% | 40.0% | 38.7% | 39.5% | 37.0% | -2.5% |
| SG&A, % of revenue | | | | | 7.0% | |
| Net Income Margin | 5.0% | 13.7% | 16.6% | 3.6% | 2.3% | -1.3% |
| CAPEX, % of revenue | 17.1% | 9.4% | 12.3% | 7.1% | 13.6% | 6.6% |
|
|---|
| ROIC | 3.0% | 9.2% | 9.7% | 10.6% | 9.8% | -0.8% |
| ROE | 3.5% | 19.7% | 24.9% | 4.2% | 2.1% | -2.1% |
| Net Debt/EBITDA | 21.4x | 4.7x | 5.2x | 2.6x | 2.6x | -0.0x |
Peers in Travel Support Services
Below you can find Cox & Kings benchmarking vs. other companies in Travel Support Services 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 EBITDA margin, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Ace Tours Worldwide ($ATWL) | - | - | - | 7.1% | - |
| |
|---|
| Median (1 company) | - | - | - | 7.1% | - |
|---|
| Cox & Kings ($COX&KINGS) | 20.1% | 40.0% | 38.7% | 39.5% | 37.0% |
Top companies by ROIC, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Ace Tours Worldwide ($ATWL) | 6.5% | 7.5% | - | - | - |
| |
|---|
| Median (1 company) | 6.5% | 7.5% | - | - | - |
|---|
| Cox & Kings ($COX&KINGS) | 3.0% | 9.2% | 9.7% | 10.6% | 9.8% |
Top companies by Net Debt / EBITDA
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Ace Tours Worldwide ($ATWL) | 1.8x | 1.7x | 0.0x | 0.0x | - |
| |
|---|
| Median (1 company) | 1.8x | 1.7x | 0.0x | 0.0x | - |
|---|
| Cox & Kings ($COX&KINGS) | 21.4x | 4.7x | 5.2x | 2.6x | 2.6x |
