Bombay Burmah Trading Corp reports 41.0% EBITDA growth in 2016 and 2.9 pp EBITDA Margin growth from 10.5% to 13.4%
28-05-2016 • About Bombay Burmah Trading Corp (
$BBTC) • By InTwits
Bombay Burmah Trading Corp reported FY2016 financial results today. Here are the key drivers of the company's long term financial model:
- Bombay Burmah Trading Corp is a growth stock: FY2016 revenue growth was 10.3%, 5 year revenue CAGR was 12.0% at FY2016 ROIC 31.0%
- EBITDA Margin is expanding: 13.4% in FY2016 vs. 10.5% in FY2015 vs. 6.0% in FY2012
- Bombay Burmah Trading Corp has low CAPEX intensity: 5 year average CAPEX/Revenue was 3.1%. At the same time it's in pair with industry average of 3.6%
- CAPEX is quite volatile: ₹2,811m in FY2016, ₹4,488m in FY2015, ₹9,924m in FY2014, ₹5,139m in FY2013, ₹6,186m in FY2012
- The company has highly profitable business model: ROIC is 31.0%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Bombay Burmah Trading Corp's Revenue jumped on 10.3%. Revenue growth happened at the same time with EBITDA margin expansion. EBITDA Margin increased on 2.9 pp from 10.5% to 13.4% in FY2016. EBITDA Margin grew at 1.9 pp per annum in the last 5 years.
Net Income margin showed almost no change in FY2016.
Investments (CAPEX, working capital and M&A)
Bombay Burmah Trading Corp's CAPEX/Revenue was 3.1% in FY2016. CAPEX/Revenue showed almost no change from FY2013 to FY2016. For the last three years the average CAPEX/Revenue was 2.3%. During FY2012-FY2016 CAPEX as a % of Revenue bottomed in FY2015 at 1.6%.
Return on investment
The company operates at high and attractive ROIC (31.0%) and ROE (22.1%). ROIC increased on 7.3 pp from 23.7% to 31.0% in FY2016. ROE decreased on 2.9 pp from 25.0% to 22.1% in FY2016. ROIC stuck to a growing trend at 5.0 pp per annum in FY2012-FY2016.
Leverage (Debt)
Debt level is 0.5x Net Debt / EBITDA and 0.7x Debt / EBITDA. Net Debt / EBITDA dropped on 0.1x from 0.7x to 0.5x in FY2016. Debt decreased on 9.8% while cash dropped on 57.9%. Net Debt/EBITDA declined at -0.6x per annum in FY2012-FY2016.
Bombay Burmah Trading Corp has short term refinancing risk: cash is only 26.7% of short term debt.
Management team
Bombay Burmah Trading Corp's CFO Amit Chhabra has spent 4 years with the company.
Financial and operational results
Bombay Burmah Trading Corp ($BBTC) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 59,276 | 65,188 | 72,712 | 81,967 | 90,427 | 10.3% |
| SG&A | | | | | 7,418 | |
| EBITDA | 3,528 | 4,415 | 6,287 | 8,613 | 12,143 | 41.0% |
| Net Income | 2,302 | 1,323 | 2,071 | 3,569 | 3,810 | 6.8% |
Balance Sheet
|
|---|
| Cash | 2,040 | 1,851 | 1,479 | 3,084 | 1,297 | -57.9% |
| Short Term Debt | 6,610 | 5,452 | 2,986 | 3,769 | 4,866 | 29.1% |
| Long Term Debt | 5,920 | 4,216 | 4,884 | 5,062 | 3,096 | -38.8% |
Cash flow
|
|---|
| Capex | 2,813 | 2,346 | 1,647 | 1,271 | 2,847 | 124.0% |
Ratios
|
|---|
| Revenue growth | 15.7% | 10.0% | 11.5% | 12.7% | 10.3% | |
| EBITDA growth | 10.2% | 25.2% | 42.4% | 37.0% | 41.0% | |
|
|---|
| EBITDA Margin | 6.0% | 6.8% | 8.6% | 10.5% | 13.4% | 2.9% |
| SG&A, % of revenue | | | | | 8.2% | |
| Net Income Margin | 3.9% | 2.0% | 2.8% | 4.4% | 4.2% | -0.1% |
| CAPEX, % of revenue | 4.7% | 3.6% | 2.3% | 1.6% | 3.1% | 1.6% |
|
|---|
| ROIC | 10.7% | 13.9% | 20.6% | 23.7% | 31.0% | 7.3% |
| ROE | 23.1% | 11.8% | 17.0% | 25.0% | 22.1% | -2.9% |
| Net Debt/EBITDA | 3.0x | 1.8x | 1.0x | 0.7x | 0.5x | -0.1x |
Peers in Tea & Coffee
Below we provide Bombay Burmah Trading Corp benchmarking against other companies in Tea & Coffee 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 |
|---|
| Ccl Products (India) ($CCL) | - | 29.6% | 10.2% | 22.8% | 5.9% |
| Diana Tea Co ($DIANATEA) | -12.6% | -11.1% | 9.9% | 11.6% | - |
| Goodricke Group ($GOODRICKE) | 17.5% | 7.4% | 4.3% | 9.9% | - |
| Tata Coffee ($TATACOFFEE) | - | 7.3% | -3.0% | 5.1% | 4.2% |
| Tata Global Beverages ($TATAGLOBAL) | - | 10.4% | 4.8% | 4.9% | -18.3% |
| |
|---|
| Median (10 companies) | 13.9% | 8.9% | 8.9% | 4.8% | 5.0% |
|---|
| Bombay Burmah Trading Corp ($BBTC) | - | 10.0% | 11.5% | 12.7% | 10.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Ccl Products (India) ($CCL) | 20.3% | 20.1% | 21.5% | 20.6% | 22.0% |
| Tata Coffee ($TATACOFFEE) | 12.8% | 19.2% | 19.9% | 20.2% | 17.7% |
| B & A ($BNALTD) | 18.4% | 17.1% | 17.1% | 14.8% | - |
| Rossell India ($ROSSELLIND) | 31.0% | 27.5% | 26.5% | 14.7% | - |
| Tata Global Beverages ($TATAGLOBAL) | 9.5% | 10.6% | 9.9% | 9.7% | 10.0% |
| |
|---|
| Median (9 companies) | 11.1% | 17.4% | 18.5% | 9.7% | 10.0% |
|---|
| Bombay Burmah Trading Corp ($BBTC) | 6.0% | 6.8% | 8.6% | 10.5% | 13.4% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Rossell India ($ROSSELLIND) | 11.0% | 6.7% | 14.8% | 11.1% | - |
| Mcleod Russel India ($MCLEODRUSS) | 10.0% | 6.0% | 9.4% | 9.8% | - |
| Tata Coffee ($TATACOFFEE) | 3.2% | 4.3% | 4.0% | 3.6% | 3.6% |
| Andrew Yule & Company ($ANDREWYU) | 2.8% | 1.8% | 2.4% | 2.9% | - |
| Ccl Products (India) ($CCL) | 11.1% | 5.8% | 8.3% | 2.4% | 9.4% |
| |
|---|
| Median (6 companies) | 4.5% | 3.5% | 3.3% | 3.3% | 3.3% |
|---|
| Bombay Burmah Trading Corp ($BBTC) | 4.7% | 3.6% | 2.3% | 1.6% | 3.1% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Ccl Products (India) ($CCL) | 16.1% | 18.0% | 19.7% | 23.0% | 25.7% |
| Tata Coffee ($TATACOFFEE) | 10.9% | 16.2% | 14.0% | 14.0% | 11.5% |
| Tata Global Beverages ($TATAGLOBAL) | 8.2% | 9.6% | 8.1% | 8.0% | 6.5% |
| Rossell India ($ROSSELLIND) | - | 12.1% | 12.7% | 4.1% | - |
| Andrew Yule & Company ($ANDREWYU) | 4.0% | 3.7% | 6.5% | 2.6% | - |
| |
|---|
| Median (13 companies) | 10.9% | 14.2% | 13.4% | 6.0% | 9.0% |
|---|
| Bombay Burmah Trading Corp ($BBTC) | 10.7% | 13.9% | 20.6% | 23.7% | 31.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Mcleod Russel India ($MCLEODRUSS) | 0.4x | 0.5x | 0.7x | 4.2x | - |
| Rossell India ($ROSSELLIND) | 0.0x | 1.9x | 1.5x | 2.6x | - |
| Tata Coffee ($TATACOFFEE) | 3.6x | 2.6x | 2.7x | 2.5x | 2.7x |
| Andrew Yule & Company ($ANDREWYU) | 2.1x | 5.4x | 1.9x | 1.7x | - |
| Ccl Products (India) ($CCL) | 2.6x | 2.3x | 1.7x | 1.1x | 0.7x |
| |
|---|
| Median (9 companies) | 1.4x | 1.7x | 0.4x | 1.1x | 1.3x |
|---|
| Bombay Burmah Trading Corp ($BBTC) | 3.0x | 1.8x | 1.0x | 0.7x | 0.5x |
