Looking for fundamental growth story? Pay attention to Grupo Clarin Sa
18 Mar 2015 • About Grupo Clarin Sa (
$GCLA) • By InTwits
Have you thought about Grupo Clarin Sa as a growth stock? Its revenue performance, profitability and healthy financial model stands it out vs. other public companies on the market.
Growth story
Grupo Clarin Sa showed growth in the last financial year. Grupo Clarin Sa's revenue surged on 39.8% in FY2014. The growth also happened in EBITDA of 51.5% for the same period.
If we look for the longer period Grupo Clarin Sa showed fast revenue growth of 28.3% from 2011 to 2014 annually. EBITDA surged on 26.9% from 2011 to 2014 annually.
Grupo Clarin Sa ($GCLA) financials for the last 5 years
| mln. ARS | 2010 | 2011 | 2012 | 2013 | 2014 |
|---|
| Revenue | 7,632 | 9,325 | 11,319 | 14,100 | 19,710 |
|---|
| Revenue growth, % | | 22.2% | 21.4% | 24.6% | 39.8% |
|---|
| Gross margin, % | 52.9% | 42.4% | 42.5% | 42.3% | 44.1% |
|---|
| SG&A, % | 22.1% | 24.0% | 25.7% | 27.0% | 25.9% |
|---|
| EBITDA | 2,352 | 2,476 | 2,773 | 3,342 | 5,064 |
|---|
| EBITDA growth, % | | 5.3% | 12.0% | 20.5% | 51.5% |
|---|
| EBITDA margin, % | 30.8% | 26.5% | 24.5% | 23.7% | 25.7% |
|---|
| Net Income | 534 | 515 | 482 | 480 | 804 |
|---|
| Net Income margin, % | 6.99% | 5.52% | 4.26% | 3.40% | 4.08% |
|---|
| |
| CAPEX | 968 | 1,478 | 1,383 | 1,859 | 2,518 |
|---|
| CAPEX/Revenue, % | 12.7% | 15.9% | 12.2% | 13.2% | 12.8% |
|---|
| Debt | 2,394 | 3,192 | 3,187 | 4,139 | 4,589 |
|---|
| Cash | 363 | 629 | 623 | 1,333 | 1,162 |
|---|
| Net Debt/EBITDA | 0.9x | 1.0x | 0.9x | 0.8x | 0.7x |
|---|
| |
| ROIC, % | 24.4% | 21.7% | 21.6% | 21.8% | 29.8% |
|---|
| ROE, % | 17.5% | 14.8% | 12.5% | 10.9% | 15.7% |
|---|
Profitability and return on investment
Margin expansion supported EBITDA growth. Grupo Clarin Sa showed EBITDA margin growth of 2 pp from 23.7% to 25.7% in 2014. If we look for the longer period Grupo Clarin Sa showed small EBITDA margin decline of 0.800 pp from 26.5% in 2011 to 25.7% in 2014.
We call Grupo Clarin Sa an attractive growth stock as together with the growth it delivers high ROIC at 29.8%. During the last three years it surged - it was 21.7% in FY2011. It's average level of ROIC for the last three years was 24.4%.
Grupo Clarin Sa showed fast Net Income margin growth of 0.700 pp from 3.40% to 4.10% in 2014. If we look for the longer period the company's Net Income margin dropped on 1.40 pp from 5.50% in 2011 to 4.10% in 2014.
Grupo Clarin Sa operates at ROE of 15.7%. Average ROE for the last three years was 13.0%.
Capital expenditures (CAPEX)
To this fast growth Grupo Clarin Sa had to invest in CAPEX.Grupo Clarin Sa's CAPEX/Revenue was 12.8% in FY2014. The company showed big decline in CAPEX/Revenue of 3.07 pp from 15.9% in 2011 to 12.8% in 2014. It's average level of CAPEX/Revenue for the last three years was 12.7%.
Leverage (Debt)
Having such a fast growth profile Grupo Clarin Sa keeps low debt level at 0.7x Net Debt/EBITDA. If we look for the longer period the company's leverage dropped on 0.36x from 1.04x in 2011 to 0.68x in 2014.
Valuation vs. comparable companies
The market closed today at 0.7x EV/EBITDA for Grupo Clarin Sa which is 96.2% lower than 18.0x Media peer group avearge calculated on the basis of 113 companies. At the end of trading day today Grupo Clarin Sa traded at 0.0x P/E which is 99.8% lower than 10.2x Media peer group avearge calculated on the basis of 15 companies.
For capital intensive compnanies it's worth taking a look at EV/(EBITDA-CAPEX) multiple. The company trades at 1.4x EV/(EBITDA-CAPEX) which is not surprisingly 271% higher than 0.4x Media industry avearge calculated based on 18 companies.
Peers in Media
Below you can find Grupo Clarin Sa benchmarking vs. other companies in Media 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, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Tangent Communications ($TNG) | | 23.1% | -3.0% | 11.8% | 11.3% |
| Haynes Publishing Group ($HYNS) | | -1.7% | -8.9% | -7.3% | 6.0% |
| Naspers ($NPSN) | | 28.2% | 15.7% | 10.2% | 4.8% |
| Dq Entertainment ($DQE) | | 18.4% | 9.7% | 1.3% | 4.5% |
| Mbl Group ($MUBL) | | -89.8% | -24.6% | -24.9% | 4.0% |
| |
|---|
| Median (8 companies) | | -1.7% | -8.9% | -13.5% | 4.2% |
|---|
| Grupo Clarin Sa ($GCLA) | | 22.2% | 21.4% | 24.6% | 39.8% |
Top companies by Gross margin, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Jaywing ($JWNG) | 73.2% | 80.5% | 79.8% | 76.8% | 81.0% |
| Tangent Communications ($TNG) | 47.1% | 49.0% | 54.5% | 57.6% | 60.3% |
| Haynes Publishing Group ($HYNS) | 64.2% | 63.5% | 59.9% | 59.6% | 52.9% |
| Naspers ($NPSN) | 48.4% | 46.2% | 47.2% | 44.5% | 43.5% |
| Dq Entertainment ($DQE) | 35.1% | 27.3% | 34.9% | 39.5% | 42.6% |
| |
|---|
| Median (8 companies) | 41.1% | 33.9% | 35.0% | 39.5% | 43.1% |
|---|
| Grupo Clarin Sa ($GCLA) | 52.9% | 42.4% | 42.5% | 42.3% | 44.1% |
Top companies by EBITDA margin, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Dq Entertainment ($DQE) | 38.0% | 36.5% | 42.8% | 49.2% | 62.4% |
| Haynes Publishing Group ($HYNS) | 28.9% | 30.2% | 25.7% | 23.4% | 38.8% |
| Avesco Group ($AVS) | 16.1% | 14.6% | 16.9% | 8.1% | 14.9% |
| Tangent Communications ($TNG) | 7.9% | 9.3% | 10.1% | 9.7% | 12.7% |
| Jaywing ($JWNG) | 11.2% | 45.9% | 11.7% | 12.6% | 6.5% |
| |
|---|
| Median (7 companies) | 11.2% | 14.6% | 11.7% | 9.7% | 12.7% |
|---|
| Grupo Clarin Sa ($GCLA) | 30.8% | 26.5% | 24.5% | 23.7% | 25.7% |
Top companies by CAPEX/Revenue, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Avesco Group ($AVS) | 11.8% | 14.3% | 22.7% | 13.2% | 18.6% |
| Haynes Publishing Group ($HYNS) | 3.5% | 1.8% | 2.5% | 3.5% | 2.5% |
| Mbl Group ($MUBL) | 1.1% | 8.5% | 3.6% | 2.6% | 2.1% |
| Tangent Communications ($TNG) | 2.6% | 4.0% | 4.5% | 3.3% | 1.9% |
| Jaywing ($JWNG) | 0.6% | 0.8% | 0.7% | 2.0% | 1.5% |
| |
|---|
| Median (7 companies) | 2.6% | 4.0% | 3.6% | 2.6% | 1.9% |
|---|
| Grupo Clarin Sa ($GCLA) | 12.7% | 15.9% | 12.2% | 13.2% | 12.8% |
Top companies by ROIC, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Haynes Publishing Group ($HYNS) | 21.0% | 20.1% | 12.8% | 9.4% | 12.5% |
| Dq Entertainment ($DQE) | 10.5% | 8.2% | 9.3% | 8.9% | 12.1% |
| Tangent Communications ($TNG) | 4.2% | 6.8% | 7.2% | 6.1% | 7.8% |
| Naspers ($NPSN) | 8.7% | 8.4% | 5.4% | 5.6% | 2.1% |
| Avesco Group ($AVS) | 0.4% | 0.8% | 7.7% | -10.6% | 1.1% |
| |
|---|
| Median (9 companies) | 8.7% | 4.6% | 5.4% | 2.8% | 1.1% |
|---|
| Grupo Clarin Sa ($GCLA) | 24.4% | 21.7% | 21.6% | 21.8% | 29.8% |
Top companies by Net Debt / EBITDA
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Future ($FUTR) | 0.6x | | 2.4x | 3.3x | |
| Naspers ($NPSN) | 0.8x | 1.1x | 1.4x | 1.9x | |
| Dq Entertainment ($DQE) | -0.2x | 0.2x | 1.1x | 1.5x | 1.5x |
| Jaywing ($JWNG) | 1.3x | 0.2x | 0.7x | 0.7x | 3.3x |
| Tangent Communications ($TNG) | -0.7x | -0.7x | -0.5x | -0.9x | -0.8x |
| |
|---|
| Median (7 companies) | 0.6x | 0.2x | 1.0x | 0.7x | 1.1x |
|---|
| Grupo Clarin Sa ($GCLA) | 0.9x | 1.0x | 0.9x | 0.8x | 0.7x |
