Uflex reports 125% CAPEX growth in 2016 while 2.4% Revenue decline
27-05-2016 • About Uflex (
$UFLEX) • By InTwits
Uflex reported FY2016 financial results today. Here are the key drivers of the company's long term financial model:
- Uflex has high CAPEX intensity: 5 year average CAPEX/Revenue was 10.0%. At the same time it's a lot of higher than industry average of 6.9%.
- CAPEX is quite volatile: ₹5,038m in FY2016, ₹2,238m in FY2015, ₹1,935m in FY2014, ₹5,851m in FY2013, ₹10,097m in FY2012
- The company has business model with low profitability: ROIC is 9.0%
- It operates with high leverage: Net Debt/EBITDA is 2.2x while industry average is 0.9x
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 2.4%. Revenue decline was accelerating on average at -6.5 pp per annum in the last 5 years. Revenue decline happened at the same time with EBITDA margin expansion. EBITDA Margin increased slightly on 1.1 pp from 11.9% to 13.0% in FY2016. During FY2012-FY2016 EBITDA Margin bottomed in FY2015 at 11.9%.
Net Income margin increased slightly on 1.1 pp from 4.1% to 5.2% in FY2016. During FY2012-FY2016 Net Income margin bottomed in FY2014 at 3.6% and was growing since that time.
Investments (CAPEX, working capital and M&A)
In FY2016 Uflex had CAPEX/Revenue of 8.4%. Uflex's CAPEX/Revenue decreased on 3.5 pp from 11.8% in FY2013 to 8.4% in FY2016. Average CAPEX/Revenue for the last three years was 5.1%. Battling declining revenue Uflex invested a large share of EBITDA (64.2%) to CAPEX but that didn't help at least in this year. During the last 5 years CAPEX as a % of Revenue bottomed in FY2014 at 3.5% and was growing since that time.
Return on investment
The company operates at low ROIC (9.0%) and ROE (9.9%). ROIC increased slightly on 0.59 pp from 8.4% to 9.0% in FY2016. ROE increased slightly on 1.1 pp from 8.7% to 9.9% in FY2016. During the last 5 years ROIC bottomed in FY2014 at 8.1% and was growing since that time. During FY2012-FY2016 ROE bottomed in FY2014 at 7.6% and was growing since that time.
Leverage (Debt)
Company's Net Debt / EBITDA is 2.2x and Debt / EBITDA is 2.7x. Net Debt / EBITDA dropped on 0.5x from 2.8x to 2.2x in FY2016. Debt decreased on 3.0% while cash surged on 104%. During FY2012-FY2016 Net Debt/EBITDA topped in FY2014 at 3.2x and was declining since that time.
Uflex has short term refinancing risk: cash is only 35.0% of short term debt.
Management team
Ravinder Kumar Jain is a Uflex's CFO. Ravinder Kumar Jain has spent 13 years at the company.
Financial and operational results
Uflex ($UFLEX) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 43,871 | 49,564 | 56,033 | 61,803 | 60,317 | -2.4% |
| SG&A | | | | | 62 | |
| EBITDA | 6,693 | 6,941 | 6,883 | 7,350 | 7,850 | 6.8% |
| Net Income | 2,550 | 1,904 | 2,016 | 2,548 | 3,128 | 22.8% |
Balance Sheet
|
|---|
| Cash | 1,548 | 1,495 | 1,886 | 1,855 | 3,794 | 104.5% |
| Short Term Debt | 7,891 | 9,482 | 10,873 | 12,035 | 10,852 | -9.8% |
| Long Term Debt | 11,462 | 13,012 | 13,288 | 10,065 | 10,586 | 5.2% |
Cash flow
|
|---|
| Capex | 10,097 | 5,851 | 1,935 | 2,238 | 5,038 | 125.1% |
Ratios
|
|---|
| Revenue growth | 28.9% | 13.0% | 13.1% | 10.3% | -2.4% | |
| EBITDA growth | -42.5% | 3.7% | -0.8% | 6.8% | 6.8% | |
|
|---|
| EBITDA Margin | 15.3% | 14.0% | 12.3% | 11.9% | 13.0% | 1.1% |
| SG&A, % of revenue | | | | | 0.1% | |
| Net Income Margin | 5.8% | 3.8% | 3.6% | 4.1% | 5.2% | 1.1% |
| CAPEX, % of revenue | 23.0% | 11.8% | 3.5% | 3.6% | 8.4% | 4.7% |
|
|---|
| ROIC | 12.5% | 9.9% | 8.1% | 8.4% | 9.0% | 0.6% |
| ROE | 12.3% | 8.0% | 7.6% | 8.7% | 9.9% | 1.1% |
| Net Debt/EBITDA | 2.7x | 3.0x | 3.2x | 2.8x | 2.2x | -0.5x |
Peers in Containers & Packaging
Below we provide Uflex benchmarking against other companies in Containers & Packaging 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 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Control Print ($CONTROLPR) | - | 20.0% | 14.1% | 23.9% | 17.9% |
| Shri Jagdamba Polymers ($SHRJAGP) | 35.5% | 38.3% | 21.7% | 22.7% | - |
| Kg Petrochem ($KGPETRO) | 16.1% | 24.0% | 20.9% | 22.4% | - |
| Kanpur Plastipack ($KANPRPLA) | - | -4.6% | 21.1% | 15.9% | -0.0% |
| Emmbi Industries ($EMMBI) | - | 36.6% | 13.9% | 14.8% | 13.3% |
| |
|---|
| Median (19 companies) | 16.1% | 16.9% | 14.1% | 8.4% | -1.6% |
|---|
| Uflex ($UFLEX) | - | 13.0% | 13.1% | 10.3% | -2.4% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Control Print ($CONTROLPR) | 13.9% | 19.2% | 22.5% | 25.2% | 27.3% |
| Manaksia ($MANAKSIA) | 14.4% | 17.4% | 20.3% | 18.6% | 16.6% |
| Essel Propack ($ESSELPRO) | 17.0% | 17.4% | 16.9% | 17.2% | 19.4% |
| Time Technoplast ($TIMETECHNO) | 15.9% | 16.2% | 14.1% | 13.7% | - |
| Piramal Glass ($PIRAMGLAS) | 23.7% | 18.9% | 15.5% | 13.5% | - |
| |
|---|
| Median (22 companies) | 12.9% | 10.6% | 11.4% | 8.8% | 14.7% |
|---|
| Uflex ($UFLEX) | 15.3% | 14.0% | 12.3% | 11.9% | 13.0% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Control Print ($CONTROLPR) | 3.0% | 5.0% | 7.5% | 11.9% | 8.9% |
| Essel Propack ($ESSELPRO) | 10.0% | 6.7% | 8.5% | 9.4% | 8.9% |
| Manaksia ($MANAKSIA) | 9.0% | 4.8% | 4.7% | 6.5% | 8.5% |
| Piramal Glass ($PIRAMGLAS) | 20.7% | 6.0% | 7.7% | 4.6% | - |
| Time Technoplast ($TIMETECHNO) | 17.9% | 11.1% | 6.2% | 4.2% | - |
| |
|---|
| Median (6 companies) | 8.6% | 6.4% | 7.1% | 5.6% | 8.7% |
|---|
| Uflex ($UFLEX) | 23.0% | 11.8% | 3.5% | 3.6% | 8.4% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Control Print ($CONTROLPR) | - | 19.7% | 22.2% | 25.2% | 26.2% |
| Essel Propack ($ESSELPRO) | 8.6% | 9.9% | 12.5% | 14.7% | 16.6% |
| Time Technoplast ($TIMETECHNO) | 12.8% | 13.4% | 12.0% | 12.9% | - |
| Manaksia ($MANAKSIA) | 12.9% | 15.5% | 16.0% | 11.4% | 9.2% |
| Piramal Glass ($PIRAMGLAS) | 16.1% | 11.0% | 7.6% | 7.0% | - |
| |
|---|
| Median (32 companies) | 9.1% | 9.9% | 12.0% | 12.2% | 12.9% |
|---|
| Uflex ($UFLEX) | 12.5% | 9.9% | 8.1% | 8.4% | 9.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Hindusthan National Glass & Industries ($HINDNATGLS) | 7.4x | 15.8x | 11.2x | 10.6x | 8.1x |
| Piramal Glass ($PIRAMGLAS) | 3.1x | 4.1x | 4.3x | 4.2x | - |
| Essel Propack ($ESSELPRO) | 3.2x | 2.9x | 2.6x | 2.2x | 1.6x |
| Time Technoplast ($TIMETECHNO) | 2.6x | 2.6x | 2.6x | 2.2x | - |
| Manaksia ($MANAKSIA) | 1.3x | 1.2x | 0.3x | 0.9x | 0.1x |
| |
|---|
| Median (20 companies) | 3.2x | 3.5x | 0.9x | 0.0x | 0.0x |
|---|
| Uflex ($UFLEX) | 2.7x | 3.0x | 3.2x | 2.8x | 2.2x |
