Waterbase reports 96.5% Net Income decline in 2016 while 14.5% Revenue growth
25-05-2016 • About Waterbase (
$WATERBASE) • By InTwits
Waterbase reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Waterbase is a fast growth stock: FY2016 revenue growth was 14.5%, 5 year revenue CAGR was 47.0% at FY2016 ROIC 17.2%
- Waterbase has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.5%. At the same time it's in pair with industry average of 8.6%
- CAPEX is quite volatile: ₹51m in FY2016, ₹50m in FY2015, ₹8m in FY2014, ₹25m in FY2013, ₹25m in FY2012
- The company has highly profitable business model: ROIC is 17.2%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Waterbase's Revenue surged on 14.5%. Revenue decline was accelerating on average at -24.9 pp per annum in FY2012-FY2016. Revenue growth was financed by EBITDA margin decline. EBITDA Margin decreased on 3.7 pp from 11.2% to 7.5% in FY2016.
Net Income margin decreased on 6.8 pp from 7.0% to 0.22% in FY2016.
Investments (CAPEX, working capital and M&A)
In FY2016 Waterbase had CAPEX/Revenue of 1.6%. CAPEX/Revenue showed almost no change from FY2013 to FY2016. It's average level of CAPEX/Revenue for the last three years was 1.2%.
Return on investment
The company operates at good ROIC (17.2%) while ROE is low (0.7%). ROIC decreased on 8.1 pp from 25.3% to 17.2% in FY2016. ROE dropped on 20.3 pp from 21.0% to 0.69% in FY2016. During FY2012-FY2016 ROIC topped in FY2015 at 25.3%.
Leverage (Debt)
Debt level is -0.2x Net Debt / EBITDA and 0.4x Debt / EBITDA. Debt dropped on 17.5% while cash dropped on 38.8%.
Waterbase has no short term refinancing risk: cash is higher than short term debt (137.4%).
Valuation and dividends
The company's trades at EV/EBITDA 11.6x and P/E 409.9x while industy averages are 17.8x and 21.9x. Waterbase's EV/(EBITDA-CAPEX) is 14.7x with the industry average at 22.8x.
Financial and operational results
Waterbase ($WATERBASE) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 1,035 | 1,570 | 2,282 | 2,772 | 3,175 | 14.5% |
| EBITDA | 111 | 122 | 237 | 309 | 238 | -22.9% |
| Net Income | 56 | 60 | 136 | 195 | 7 | -96.5% |
Balance Sheet
|
|---|
| Cash | 51 | 126 | 101 | 227 | 139 | -38.8% |
| Short Term Debt | 86 | 181 | 104 | 121 | 101 | -16.0% |
| Long Term Debt | 105 | 102 | 22 | 3 | 1 | -74.7% |
Cash flow
|
|---|
| Capex | 25 | 25 | 8 | 50 | 51 | 2.0% |
Ratios
|
|---|
| Revenue growth | 124.1% | 51.8% | 45.3% | 21.5% | 14.5% | |
| EBITDA growth | 113.0% | 9.8% | 95.3% | 30.4% | -22.9% | |
|
|---|
| EBITDA Margin | 10.7% | 7.7% | 10.4% | 11.2% | 7.5% | -3.7% |
| Net Income Margin | 5.4% | 3.8% | 5.9% | 7.0% | 0.2% | -6.8% |
| CAPEX, % of revenue | 2.4% | 1.6% | 0.4% | 1.8% | 1.6% | -0.2% |
|
|---|
| ROIC | 10.8% | 11.3% | 22.5% | 25.3% | 17.2% | -8.1% |
| ROE | 11.1% | 10.5% | 18.5% | 21.0% | 0.7% | -20.3% |
| Net Debt/EBITDA | 1.3x | 1.3x | 0.1x | -0.3x | -0.2x | 0.2x |
Peers in Other Food Products
Below you can find Waterbase benchmarking vs. other companies in Other Food 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 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Skm Egg Products Export (India) ($SKMEGGPROD) | - | 51.0% | 23.4% | 10.0% | 3.7% |
| |
|---|
| Median (1 company) | - | 51.0% | 23.4% | 10.0% | 3.7% |
|---|
| Waterbase ($WATERBASE) | - | 51.8% | 45.3% | 21.5% | 14.5% |
Top companies by EBITDA margin, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Lactose (India) ($LACTOSE) | - | - | - | 22.2% | - |
| Skm Egg Products Export (India) ($SKMEGGPROD) | 1.7% | 11.5% | 16.8% | 11.9% | 13.0% |
| Chordia Food Products ($CHORDIA) | - | - | - | 8.6% | - |
| |
|---|
| Median (3 companies) | 1.7% | 11.5% | 16.8% | 11.9% | 13.0% |
|---|
| Waterbase ($WATERBASE) | 10.7% | 7.7% | 10.4% | 11.2% | 7.5% |
Top companies by CAPEX/Revenue, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Skm Egg Products Export (India) ($SKMEGGPROD) | 0.3% | 0.3% | 0.9% | 0.8% | 3.0% |
| |
|---|
| Median (1 company) | 0.3% | 0.3% | 0.9% | 0.8% | 3.0% |
|---|
| Waterbase ($WATERBASE) | 2.4% | 1.6% | 0.4% | 1.8% | 1.6% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Skm Egg Products Export (India) ($SKMEGGPROD) | -3.4% | 4.8% | 36.3% | 29.4% | 30.0% |
| Saboo Sodium Chloro ($SABOOSOD) | -0.4% | - | - | - | - |
| Lactose (India) ($LACTOSE) | - | - | - | - | - |
| Kothari Fermentation & Biochem ($KFBL) | - | - | - | - | - |
| Chordia Food Products ($CHORDIA) | 10.2% | - | - | - | - |
| |
|---|
| Median (5 companies) | -0.4% | 4.8% | 36.3% | 29.4% | 30.0% |
|---|
| Waterbase ($WATERBASE) | 10.8% | 11.3% | 22.5% | 25.3% | 17.2% |
Top companies by Net Debt / EBITDA
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Skm Egg Products Export (India) ($SKMEGGPROD) | 34.3x | 3.4x | 0.6x | 0.9x | 0.4x |
| Chordia Food Products ($CHORDIA) | 0.8x | - | - | 0.0x | - |
| Lactose (India) ($LACTOSE) | 0.0x | 2.0x | 0.0x | 0.0x | - |
| |
|---|
| Median (3 companies) | 3.5x | 1.0x | 0.0x | 0.0x | 0.4x |
|---|
| Waterbase ($WATERBASE) | 1.3x | 1.3x | 0.1x | -0.3x | -0.2x |
