Interquest Group EBITDA surged on 26.9% in 2015 and EBITDA Margin increased slightly on 0.62 pp from 3.0% to 3.7%
09 Mar 2016 • About Interquest Group (
$ITQ) • By InTwits
Interquest Group reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is quite volatile: 3.7% in 2015, 3.0% in 2014, 2.1% in 2013, 1.8% in 2012, 5.7% in 2011
- Interquest Group has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.3%.
- The company has highly profitable business model: ROIC is at 15.5%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Interquest Group ($ITQ) key annual financial indicators
| mln. £ | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 120.9 | 112.7 | 114.9 | 150.6 | 158.6 | 5.3% |
| Gross Profit | 16.6 | 16.4 | 17.4 | 23.2 | 23.8 | 2.4% |
| SG&A | | | | 19.5 | 18.9 | -3.4% |
| EBITDA | 6.9 | 2.0 | 2.4 | 4.6 | 5.8 | 26.9% |
| Net Income | -1.1 | -0.1 | 1.0 | 2.0 | 3.0 | 50.8% |
Balance Sheet
|
|---|
| Cash | 0.3 | 0.6 | 1.1 | 1.3 | 1.2 | -7.7% |
| Short Term Debt | 5.8 | 5.0 | 10.1 | 9.6 | 7.2 | -25.3% |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 0.6 | 0.2 | 0.3 | 0.5 | 0.1 | -70.3% |
Ratios
|
|---|
| Revenue growth | 7.8% | -6.8% | 2.0% | 31.2% | 5.3% | |
| EBITDA growth | 93.0% | -71.5% | 23.8% | 86.8% | 26.9% | |
| Gross Margin | 13.8% | 14.5% | 15.1% | 15.4% | 15.0% | -0.4% |
| EBITDA Margin | 5.7% | 1.8% | 2.1% | 3.0% | 3.7% | 0.6% |
| Net Income Margin | -0.9% | -0.1% | 0.8% | 1.3% | 1.9% | 0.6% |
| SG&A, % of revenue | | | | 13.0% | 11.9% | -1.1% |
| CAPEX, % of revenue | 0.5% | 0.2% | 0.3% | 0.3% | 0.1% | -0.2% |
| ROIC | 23.6% | 4.7% | 7.7% | 11.9% | 15.5% | 3.6% |
| ROE | -5.3% | -0.7% | 4.9% | 9.3% | 13.2% | 3.8% |
| Net Debt/EBITDA | 0.8x | 2.2x | 3.7x | 1.8x | 1.0x | -0.8x |
Revenue and profitability
The company's Revenue increased on 5.3% in 2015. Revenue growth happened at the same time with EBITDA margin expansion. EBITDA Margin increased slightly on 0.62 pp from 3.0% to 3.7% in 2015.
Gross Margin showed almost no change in 2015. SG&A as a % of Revenue decreased slightly on 1.1 pp from 13.0% to 11.9% in 2015.
Net Income marign increased slightly on 0.58 pp from 1.3% to 1.9% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 0.087%. Interquest Group showed almost no change in CAPEX/Revenue from 2012 to 2015. Average CAPEX/Revenue for the last three years was 0.22%.
Return on investment
The company operates at good ROIC (15.53%) and ROE (13.17%). ROIC increased on 3.6 pp from 11.9% to 15.5% in 2015. ROE increased on 3.8 pp from 9.3% to 13.2% in 2015.
Leverage (Debt)
Debt level is 1.0x Net Debt / EBITDA and 1.2x Debt / EBITDA. Net Debt / EBITDA dropped on 0.8x from 1.8x to 1.0x in 2015. Debt dropped on 25.3% in 2015 while cash decreased on 7.7% in 2015.
Valuation
The company's trades at EV/EBITDA 6.0x and P/E 9.5x while industy averages are 10.5x and 26.1x.
Appendix 1: Peers in Support Services
Below you can find Interquest Group benchmarking vs. other companies in Support Services 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, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Petards Group ($PEG) | 6.5% | -25.7% | -30.6% | 115.1% | |
| Optimal Payments ($OPAY) | 107.9% | 39.9% | 41.5% | 44.0% | |
| 1Spatial ($SPA) | | 98.7% | 131.4% | 42.7% | 13.5% |
| Inspired Energy ($INSE) | 32.9% | 83.8% | 44.8% | 42.2% | |
| Universe Group ($UNG) | -7.4% | 13.3% | 33.9% | 30.7% | |
| |
|---|
| Median (54 companies) | 9.0% | 6.9% | 7.4% | 4.7% | 6.7% |
|---|
| Interquest Group ($ITQ) | | -6.8% | 2.0% | 31.2% | 5.3% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Inspired Energy ($INSE) | | 94.6% | 86.8% | 78.7% | |
| Ienergizer Ltd ($IBPO) | 48.1% | 56.2% | 78.4% | 76.8% | 72.7% |
| Vianet Group ($VNET) | 53.1% | 53.3% | 51.3% | 58.8% | 69.2% |
| Prime People ($PRP) | 57.6% | 63.4% | 58.3% | 57.7% | 61.4% |
| Murgitroyd Group ($MUR) | 59.9% | 58.4% | 61.4% | 57.6% | 55.4% |
| |
|---|
| Median (48 companies) | 29.0% | 28.8% | 28.6% | 29.8% | 27.6% |
|---|
| Interquest Group ($ITQ) | 13.8% | 14.5% | 15.1% | 15.4% | 15.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Northgate ($67GX) | | 41.2% | 40.4% | 40.6% | 39.4% |
| 21St Century Technology ($C21) | 11.4% | 13.4% | -0.2% | 36.0% | |
| Vp ($VP.) | 24.4% | 23.9% | 24.5% | 24.2% | 26.2% |
| Ienergizer Ltd ($IBPO) | 34.5% | 27.6% | 27.8% | 23.6% | 17.1% |
| Capital Drilling Ltd ($CAPD) | 26.3% | 24.1% | 15.7% | 21.7% | |
| |
|---|
| Median (54 companies) | 7.6% | 6.8% | 6.5% | 6.9% | 7.9% |
|---|
| Interquest Group ($ITQ) | 5.7% | 1.8% | 2.1% | 3.0% | 3.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Vp ($VP.) | 15.5% | 21.4% | 17.7% | 21.6% | 25.7% |
| Norish ($NSH) | 5.0% | 10.2% | 1.4% | 15.4% | |
| Capital Drilling Ltd ($CAPD) | 20.5% | 18.9% | 4.9% | 13.9% | |
| Falkland Islands Hldgs ($FKL) | 2.6% | 3.7% | 6.8% | 12.9% | 11.9% |
| Augean ($AUG) | 11.2% | 9.8% | 15.9% | 12.3% | |
| |
|---|
| Median (54 companies) | 0.9% | 1.1% | 1.1% | 1.1% | 1.1% |
|---|
| Interquest Group ($ITQ) | 0.5% | 0.2% | 0.3% | 0.3% | 0.1% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| 21St Century Technology ($C21) | 16.2% | 20.3% | -2.9% | 45.6% | |
| Petards Group ($PEG) | 25.6% | 35.5% | -78.0% | 24.7% | |
| Driver Group ($DRV) | 6.5% | 18.7% | 27.9% | 24.0% | 3.2% |
| Optimal Payments ($OPAY) | -2.9% | 7.1% | 27.7% | 23.8% | |
| Premier Farnell ($PFLA) | | 33.2% | 21.0% | 23.2% | 18.5% |
| |
|---|
| Median (54 companies) | 8.9% | 10.1% | 8.0% | 9.3% | 10.7% |
|---|
| Interquest Group ($ITQ) | 23.6% | 4.7% | 7.7% | 11.9% | 15.5% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Inspired Energy ($INSE) | -0.8x | 0.8x | 0.6x | 19.4x | |
| Mitsubishi Corp ($MBC) | 7.2x | 9.9x | 15.9x | 14.3x | 12.5x |
| Nature Group ($NGR) | -0.6x | -0.5x | -0.4x | 6.6x | |
| Ceps ($CEPS) | 4.1x | | 3.0x | 6.6x | |
| Redhall Group ($RHL) | | 22.8x | 5.8x | 6.6x | 16.8x |
| |
|---|
| Median (52 companies) | 0.6x | 0.8x | 0.5x | 0.6x | 0.7x |
|---|
| Interquest Group ($ITQ) | 0.8x | 2.2x | 3.7x | 1.8x | 1.0x |
