Den Networks EBITDA jumped on 57.2% and Revenue jumped on 10.9%
30-05-2016 • About Den Networks (
$DEN) • By InTwits
Den Networks reported FY2016 financial results today. Here are the key drivers of the company's long term financial model:
- EBITDA Margin is quite volatile: 10.3% in FY2016, 7.3% in FY2015, 24.8% in FY2014, 22.5% in FY2013, 7.3% in FY2012
- Den Networks has high CAPEX intensity: 5 year average CAPEX/Revenue was 37.6%. At the same time it's a lot of higher than industry average of 26.7%.
- CAPEX is quite volatile: ₹4,109m in FY2016, ₹3,168m in FY2015, ₹5,840m in FY2014, ₹5,312m in FY2013, ₹1,414m in FY2012
- The company has unprofitable business model: ROIC is -4.2%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Den Networks's Revenue jumped on 10.9%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 3.7 pp from -0.92% to 2.8% in FY2016.
Net Income margin decreased on 8.2 pp from -13.0% to -21.2% in FY2016. During FY2012-FY2016 Net Income margin topped in FY2013 at 7.1% and was declining since that time.
Investments (CAPEX, working capital and M&A)
In FY2016 the company had CAPEX/Revenue of 33.3%. Den Networks's CAPEX/Revenue dropped on 27.1 pp from 60.4% in FY2013 to 33.3% in FY2016. For the last three years the average CAPEX/Revenue was 38.4%. The company has spent a lot to CAPEX (323% of EBITDA) to secure its growth.
Return on investment
The company operates at negative ROIC (-4.2%) and ROE (-16.5%). ROIC showed almost no change in FY2016. ROE decreased on 8.4 pp from -8.1% to -16.5% in FY2016. During the last 5 years ROIC topped in FY2013 at 8.1% and was declining since that time. During FY2012-FY2016 ROE topped in FY2013 at 7.4% and was declining since that time.
Leverage (Debt)
Debt level is 0.7x Net Debt / EBITDA and 4.9x Debt / EBITDA. Net Debt / EBITDA dropped on 5.3x from 6.0x to 0.7x in FY2016. Debt decreased slightly on 1.6% while cash surged on 258%.
Den Networks has no short term refinancing risk: cash is higher than short term debt (182.0%).
Management team
Shailender Nath Sharma is a the company's CEO. Shailender Nath Sharma has spent 9 years with the company. Den Networks's CFO Manish Dawar has spent 5 years with the company.
Financial and operational results
Den Networks ($DEN) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 11,234 | 8,793 | 10,978 | 11,107 | 12,323 | 10.9% |
| EBITDA | 825 | 1,974 | 2,725 | 809 | 1,272 | 57.2% |
| Net Income | 143 | 623 | 384 | -1,440 | -2,609 | |
Balance Sheet
|
|---|
| Cash | 2,976 | 2,834 | 2,470 | 1,504 | 5,384 | 258.0% |
| Short Term Debt | 680 | 3,465 | 2,558 | 2,950 | 2,958 | 0.3% |
| Long Term Debt | 1,902 | 4,010 | 4,464 | 3,380 | 3,271 | -3.2% |
Cash flow
|
|---|
| Capex | 1,414 | 5,312 | 5,840 | 3,168 | 4,109 | 29.7% |
Ratios
|
|---|
| Revenue growth | 10.0% | -21.7% | 24.8% | 1.2% | 10.9% | |
| EBITDA growth | -38.8% | 139.3% | 38.0% | -70.3% | 57.2% | |
|
|---|
| EBITDA Margin | 7.3% | 22.5% | 24.8% | 7.3% | 10.3% | 3.0% |
| Net Income Margin | 1.3% | 7.1% | 3.5% | -13.0% | -21.2% | -8.2% |
| CAPEX, % of revenue | 12.6% | 60.4% | 53.2% | 28.5% | 33.3% | 4.8% |
|
|---|
| ROIC | 2.7% | 8.1% | 5.6% | -4.0% | -4.2% | -0.2% |
| ROE | 1.8% | 7.4% | 2.8% | -8.1% | -16.5% | -8.4% |
| Net Debt/EBITDA | -0.5x | 2.4x | 1.7x | 6.0x | 0.7x | -5.3x |
Peers in Broadcasting & Cable TV
Below we provide Den Networks benchmarking against other companies in Broadcasting & Cable TV 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 |
|---|
| Siti Cable Network ($SITICABLE) | - | 37.0% | 41.6% | 36.2% | 31.2% |
| Zee Entertainment Enterprises ($ZEEL) | - | 21.7% | 18.6% | 11.5% | 19.9% |
| Dish Tv India ($DISHTV) | - | 10.7% | 15.8% | 7.1% | 13.8% |
| Entertainment Network (India) ($ENIL) | - | 9.2% | 13.2% | 14.0% | 12.2% |
| Tv18 Broadcast ($TV18BRDCST) | - | 21.4% | 16.4% | 17.8% | 10.8% |
| |
|---|
| Median (9 companies) | - | 10.7% | 18.6% | 14.0% | 10.8% |
|---|
| Den Networks ($DEN) | - | -21.7% | 24.8% | 1.2% | 10.9% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Dish Tv India ($DISHTV) | 25.5% | 27.3% | 26.4% | 28.1% | 34.5% |
| Entertainment Network (India) ($ENIL) | 32.1% | 30.8% | 32.4% | 33.3% | 29.1% |
| Siti Cable Network ($SITICABLE) | 1.6% | 17.5% | 19.9% | 15.9% | 27.1% |
| Zee Entertainment Enterprises ($ZEEL) | 24.4% | 25.9% | 27.6% | 25.7% | 25.8% |
| B.A.G.Films & Media ($BAGFILMS) | -8.7% | -6.6% | 17.9% | - | 24.1% |
| |
|---|
| Median (9 companies) | 18.6% | 17.5% | 18.2% | 24.1% | 24.1% |
|---|
| Den Networks ($DEN) | 7.3% | 22.5% | 24.8% | 7.3% | 10.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Siti Cable Network ($SITICABLE) | 10.6% | 80.9% | 73.0% | 32.5% | 79.5% |
| Hinduja Ventures ($HINDUJAVEN) | 11.6% | 65.8% | 14.2% | 7.1% | 65.0% |
| Dish Tv India ($DISHTV) | 33.5% | 32.2% | 11.9% | 26.3% | 29.7% |
| Zee Media Corporation ($ZEEMEDIA) | 3.4% | 5.9% | 31.6% | 0.0% | 11.4% |
| Balaji Telefilms ($BALAJITELE) | 2.4% | 1.3% | 0.6% | 4.3% | 6.0% |
| |
|---|
| Median (8 companies) | 3.5% | 4.1% | 7.7% | 4.1% | 8.7% |
|---|
| Den Networks ($DEN) | 12.6% | 60.4% | 53.2% | 28.5% | 33.3% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Dish Tv India ($DISHTV) | -2.5% | -4.6% | 8.7% | 24.0% | 50.0% |
| Zee Entertainment Enterprises ($ZEEL) | 21.1% | 24.2% | 25.5% | 22.1% | 23.6% |
| Entertainment Network (India) ($ENIL) | 15.2% | 14.8% | 16.7% | 17.9% | 12.5% |
| Siti Cable Network ($SITICABLE) | -6.0% | 2.9% | 3.8% | 0.5% | 8.9% |
| Zee Media Corporation ($ZEEMEDIA) | 18.8% | 11.9% | 5.2% | -1.3% | 5.3% |
| |
|---|
| Median (12 companies) | 1.0% | 3.3% | 4.6% | 9.1% | 5.3% |
|---|
| Den Networks ($DEN) | 2.7% | 8.1% | 5.6% | -4.0% | -4.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Hinduja Ventures ($HINDUJAVEN) | 0.7x | 5.9x | 5.6x | 1.1x | 11.0x |
| Raj Television Network ($RAJTV) | 0.6x | 0.7x | 1.6x | 0.9x | 5.5x |
| Zee Media Corporation ($ZEEMEDIA) | 0.2x | 0.3x | 3.0x | 10.1x | 2.8x |
| Siti Cable Network ($SITICABLE) | 56.0x | 9.5x | 5.6x | 6.7x | 1.9x |
| Entertainment Network (India) ($ENIL) | -0.4x | -0.1x | -0.1x | -0.1x | 1.6x |
| |
|---|
| Median (11 companies) | 0.2x | 1.6x | 1.6x | 1.0x | 1.4x |
|---|
| Den Networks ($DEN) | -0.5x | 2.4x | 1.7x | 6.0x | 0.7x |
