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Press Corp demonstrated fast growth over the last few years. Will the growth continue?

07 Apr 2015 • About Press Corp ($PESD) • By InTwits

Press Corp is an attractive growth stock in General Industrials industry. It showed noticeble revenue performance in the last years among with attractive profitability and financial model.

Growth story


Press Corp showed fast growth in the last financial year. Press Corp's revenue surged on 20.3% in FY2014. Together with revenue growth Press Corp also managed to keep EBITDA growth. EBITDA grew 18.6% for the same period.

In the last 3 years Press Corp showed fast revenue growth of 57.1% from 2011 to 2014 annually. EBITDA surged on 45.0% from 2011 to 2014 annually.

Press Corp ($PESD) financials for the last 5 years

mln. MWK 2010 2011 2012 2013 2014
Revenue59,34935,30574,544113,717136,787
Revenue growth, %-40.5%111.1%52.6%20.3%
Gross margin, %48.5%75.4%58.9%54.4%56.0%
SG&A, %66.1%37.9%
EBITDA13,93213,10022,02733,65639,906
EBITDA growth, %-6.0%68.1%52.8%18.6%
EBITDA margin, %23.5%37.1%29.5%29.6%29.2%
Net Income5,3163,4696,3409,37210,734
Net Income margin, % 8.96%9.83%8.51%8.24%7.85%
 
CAPEX13,5788,00315,8979,64516,614
CAPEX/Revenue, %22.9%22.7%21.3%8.48%12.1%
Debt9,50313,43726,76130,37735,754
Cash8,81911,04733,82158,02265,852
Net Debt/EBITDA0.0x0.2x-0.3x-0.8x-0.8x
 
ROIC, %18.0%12.1%21.6%27.1%24.7%
ROE, %20.1%11.6%17.2%18.9%16.3%

Profitability and return on investment


EBITDA margin declined slightly from 29.6% in FY2013 to 29.2% in FY2014. In the last 3 years Press Corp's EBITDA margin dropped on 7.90 pp from 37.1% in 2011 to 29.2% in 2014.

Press Corp shows attractive ROIC at 24.7% for the last 12 months which assumes stable development model. Three years ago it was considerably lower at 12.1%. It's average ROIC for the last three years was 24.5%.

The company showed small Net Income margin decline of 0.400 pp from 8.20% to 7.80% in 2014. In the longer period Press Corp showed big decline in Net Income margin of 2 pp from 9.80% in 2011 to 7.80% in 2014.

Press Corp operates at ROE of 16.3%. For the last three years the average ROE was 17.5%.

Capital expenditures (CAPEX)


To fuel this fast growth the company had to invest in CAPEX.Press Corp's CAPEX/Revenue was 12.1% in FY2014. The company showed big decline in CAPEX/Revenue of 10.5 pp from 22.7% in 2011 to 12.1% in 2014. It's average CAPEX/Revenue for the last three years was 14.0%.

Leverage (Debt)


The company has negative net debt at -0.8x Net Debt/EBITDA - at the same time with high growth. If we look for the longer period Press Corp's leverage dropped on 0.94x from 0.18x in 2011 to -0.75x in 2014.

Peers in General Industrials


Below we provide Press Corp benchmarking against other companies in General Industrials 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, %

 FY2010 FY2011 FY2012 FY2013 FY2014
Top 5
Robinson ($RBN)10.3%-1.6%10.2%20.3%
Thyssenkrupp Ag ($0O1C)13.3%-2.8%-7.2%6.9%
Macfarlane Group ($MACF)6.7%-1.9%1.4%6.9%
Barloworld ($BWO)22.0%17.5%1.6%4.4%
Honeywell International Inc ($HON)12.9%3.1%3.7%3.2%
 
Median (9 companies)10.3%1.3%1.4%3.2%
Press Corp ($PESD)-40.5%111.1%52.6%20.3%


Top companies by Gross margin, %

 FY2010 FY2011 FY2012 FY2013 FY2014
Top 5
Macfarlane Group ($MACF)31.0%30.2%32.0%31.2%30.9%
Smurfit Kappa Group ($SKG)27.7%27.9%28.6%28.9%29.5%
Honeywell International Inc ($HON)23.6%21.8%24.9%27.4%28.2%
Jardine Strategic Hldgs ($88EI)26.0%24.7%24.0%24.0%25.4%
General Electric Co. ($GEC)39.9%40.2%38.4%37.7%24.5%
 
Median (9 companies)23.6%22.2%24.0%24.6%24.5%
Press Corp ($PESD)48.5%75.4%58.9%54.4%56.0%


Top companies by EBITDA margin, %

 FY2010 FY2011 FY2012 FY2013 FY2014
Top 5
Honeywell International Inc ($HON)12.4%9.7%13.5%16.6%16.8%
Robinson ($RBN)15.9%14.4%16.0%14.1%15.1%
Jardine Strategic Hldgs ($88EI)29.4%28.8%15.0%13.3%13.5%
General Electric Co. ($GEC)16.0%17.6%17.2%16.5%13.3%
Smurfit Kappa Group ($SKG)12.0%13.1%13.4%12.8%12.7%
 
Median (9 companies)12.0%9.7%13.4%12.8%12.7%
Press Corp ($PESD)23.5%37.1%29.5%29.6%29.2%


Top companies by CAPEX/Revenue, %

 FY2010 FY2011 FY2012 FY2013 FY2014
Top 5
General Electric Co. ($GEC)6.6%8.9%10.5%9.4%6.1%
Smurfit Kappa Group ($SKG)4.4%3.8%4.3%4.4%5.3%
Jardine Strategic Hldgs ($88EI)3.7%4.4%5.8%5.2%4.1%
Robinson ($RBN)2.8%4.9%4.3%6.0%3.5%
Thyssenkrupp Ag ($0O1C)7.8%2.2%3.8%2.9%2.9%
 
Median (9 companies)3.7%3.8%4.3%4.4%2.9%
Press Corp ($PESD)22.9%22.7%21.3%8.5%12.1%


Top companies by ROIC, %

 FY2010 FY2011 FY2012 FY2013 FY2014
Top 5
Honeywell International Inc ($HON)17.8%14.4%21.8%23.0%21.3%
Macfarlane Group ($MACF)17.5%15.1%17.9%22.2%19.0%
Barloworld ($BWO)7.3%12.4%14.0%13.5%14.1%
Smurfit Kappa Group ($SKG)7.2%10.2%10.8%11.2%11.8%
Thyssenkrupp Ag ($0O1C)7.2%15.7%-27.3%-6.5%10.8%
 
Median (9 companies)7.2%12.4%10.3%9.6%10.8%
Press Corp ($PESD)18.0%12.1%21.6%27.1%24.7%


Top companies by Net Debt / EBITDA

 FY2010 FY2011 FY2012 FY2013 FY2014
Top 5
General Electric Co. ($GEC)14.0x11.8x10.5x8.9x12.0x
Coral Products ($CRU)1.0x1.5x1.5x2.9x3.4x
Smurfit Kappa Group ($SKG)3.9x2.9x2.9x2.6x2.7x
Thyssenkrupp Ag ($0O1C)2.1x1.1x3.4x4.5x2.0x
Jardine Strategic Hldgs ($88EI)0.6x0.6x1.4x1.3x1.3x
 
Median (9 companies)1.1x1.1x1.5x1.4x1.3x
Press Corp ($PESD)0.0x0.2x-0.3x-0.8x-0.8x


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