Omega Diagnostics Group Net Income dropped on 22.6% in 2016 and EBITDA Margin decreased slightly on 1.3 pp from 11.4% to 10.2%
27 Jun 2016 • About Omega Diagnostics Group (
$ODX) • By InTwits
Omega Diagnostics Group reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Omega Diagnostics Group has low CAPEX intensity: 5 year average CAPEX/Revenue was 4.3%. At the same time it's in pair with industry average of 2.2%.
- CAPEX is quite volatile: 0.13 in FY2016, 0.088 in FY2015, 0.25 in FY2014, 0.30 in FY2013, 0.54 in FY2012
- The company has potentially unprofitable business model: ROIC is at 3.3%
- It operates with high leverage: Net Debt/EBITDA is -0.7x while industry average is -1.5x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Omega Diagnostics Group ($ODX) key annual financial indicators
| mln. £ | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 11.124 | 11.263 | 11.594 | 12.105 | 12.744 | 5.3% |
| Gross Profit | 7.004 | 7.053 | 7.371 | 7.674 | 8.136 | 6.0% |
| SG&A | | | 6.844 | 7.174 | 7.739 | 7.9% |
| EBITDA | 1.219 | 0.977 | 1.293 | 1.386 | 1.295 | -6.5% |
| Net Income | 0.527 | 0.582 | 0.693 | 0.739 | 0.572 | -22.6% |
Balance Sheet
|
|---|
| Cash | 1.159 | 0.161 | 3.116 | 1.972 | 1.302 | -34.0% |
| Short Term Debt | 0.510 | 0.368 | 0.428 | 0.238 | 0.128 | -46.3% |
| Long Term Debt | 0.794 | 0.484 | 0.319 | 0.315 | 0.283 | -10.3% |
Cash flow
|
|---|
| Capex | 0.454 | 0.309 | 0.479 | 0.702 | 0.621 | -11.5% |
Ratios
|
|---|
| Revenue growth | 40.8% | 1.2% | 2.9% | 4.4% | 5.3% | |
| EBITDA growth | 146.0% | -19.8% | 32.4% | 7.1% | -6.5% | |
| Gross Margin | 63.0% | 62.6% | 63.6% | 63.4% | 63.8% | 0.4% |
| EBITDA Margin | 11.0% | 8.7% | 11.2% | 11.4% | 10.2% | -1.3% |
| Net Income Margin | 4.7% | 5.2% | 6.0% | 6.1% | 4.5% | -1.6% |
| SG&A, % of revenue | | | 59.0% | 59.3% | 60.7% | 1.5% |
| CAPEX, % of revenue | 4.1% | 2.7% | 4.1% | 5.8% | 4.9% | -0.9% |
| ROIC | 3.6% | 2.0% | 3.6% | 3.6% | 3.3% | -0.2% |
| ROE | 4.0% | 4.3% | 4.3% | 4.0% | 2.9% | -1.0% |
| Net Debt/EBITDA | 0.1x | 0.7x | -1.8x | -1.0x | -0.7x | 0.3x |
Revenue and profitability
The company's Revenue increased on 5.3% in FY2016. Revenue growth was financed by EBITDA margin decline. EBITDA Margin decreased slightly on 1.3 pp from 11.4% to 10.2% in FY2016.
Gross Margin showed almost no change in FY2016. SG&A as a % of Revenue increased slightly on 1.5 pp from 59.3% to 60.7% in FY2016.
Net Income marign decreased slightly on 1.6 pp from 6.1% to 4.5% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 Omega Diagnostics Group had CAPEX/Revenue of 4.9%. The company showed CAPEX/Revenue growth of 2.1 pp from 2.7% in FY2013 to 4.9% in FY2016. Average CAPEX/Revenue for the last three years was 4.9%.
Return on investment
The company operates at low ROIC (3.33%) and ROE (2.93%). ROIC showed almost no change in FY2016. ROE decreased slightly on 1.0 pp from 4.0% to 2.9% in FY2016.
Leverage (Debt)
Debt level is -0.7x Net Debt / EBITDA and 0.3x Debt / EBITDA. Net Debt / EBITDA jumped on 0.3x from -1.0x to -0.7x in FY2016. Debt dropped on 25.8% in FY2016 while cash dropped on 34.0% in FY2016.
Valuation
The company's trades at EV/EBITDA 12.7x and P/E 30.2x while industy averages are 15.6x and 19.1x. The company's EV/(EBITDA-CAPEX) is 24.3x with the industry average at 19.0x.
Appendix 1: Peers in Health Care Equipment & Services
Below we provide Omega Diagnostics Group benchmarking against other companies in Health Care Equipment & Services 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 |
|---|
| Puricore ($PURI) | 11.3% | -33.6% | -45.5% | 36.5% | |
| Md Medical Group Invest ($MDMG) | 39.7% | 39.7% | 26.9% | 32.0% | |
| Tristel ($TSTL) | 17.8% | -3.5% | 27.6% | 13.8% | |
| Lifeline Scientific Inc ($LSIC) | 18.7% | 10.2% | 6.0% | 11.8% | |
| Synergy Health ($SYR) | 8.6% | 15.8% | 5.3% | 7.5% | |
| |
|---|
| Median (10 companies) | 11.3% | 7.0% | 5.7% | 4.1% | -15.6% |
|---|
| Omega Diagnostics Group ($ODX) | | 1.2% | 2.9% | 4.4% | 5.3% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Smith & Nephew ($SN.) | 74.1% | 74.7% | 74.8% | 75.3% | |
| Tristel ($TSTL) | 67.9% | 66.4% | 69.8% | 69.5% | |
| Immunodiagnostic Systems Hldgs ($IDH) | 74.7% | 73.1% | 68.1% | 62.5% | 58.6% |
| Lifeline Scientific Inc ($LSIC) | 60.6% | 59.8% | 61.3% | 60.2% | |
| Abbott Laboratories ($ABT) | 54.3% | 53.2% | 54.5% | 57.1% | |
| |
|---|
| Median (10 companies) | 54.6% | 52.3% | 53.2% | 53.0% | 58.6% |
|---|
| Omega Diagnostics Group ($ODX) | 63.0% | 62.6% | 63.6% | 63.4% | 63.8% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Md Medical Group Invest ($MDMG) | 41.7% | 28.0% | 28.9% | 27.9% | |
| Synergy Health ($SYR) | 26.0% | 26.4% | 25.8% | 24.3% | |
| Immunodiagnostic Systems Hldgs ($IDH) | | 35.3% | 34.1% | 23.6% | -77.1% |
| Smith & Nephew ($SN.) | 27.8% | 26.9% | 25.2% | 23.1% | |
| Tristel ($TSTL) | 17.0% | 13.7% | 20.1% | 22.9% | |
| |
|---|
| Median (10 companies) | 19.0% | 17.9% | 20.3% | 22.1% | -77.1% |
|---|
| Omega Diagnostics Group ($ODX) | 11.0% | 8.7% | 11.2% | 11.4% | 10.2% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Synergy Health ($SYR) | 15.2% | 13.2% | 10.3% | 15.1% | |
| Md Medical Group Invest ($MDMG) | 65.2% | 42.8% | 43.4% | 8.2% | |
| Smith & Nephew ($SN.) | 6.4% | 7.8% | 8.1% | 7.7% | |
| Ekf Diagnostics Holdings ($EKF) | 3.7% | 3.7% | 2.8% | 7.6% | |
| Puricore ($PURI) | 2.4% | 3.2% | 15.4% | 7.3% | |
| |
|---|
| Median (10 companies) | 6.1% | 5.6% | 6.7% | 6.8% | 4.7% |
|---|
| Omega Diagnostics Group ($ODX) | 4.1% | 2.7% | 4.1% | 5.8% | 4.9% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Lifeline Scientific Inc ($LSIC) | 1.9% | 11.2% | 11.7% | 24.0% | |
| Tristel ($TSTL) | 6.5% | 3.5% | 15.9% | 20.1% | |
| Md Medical Group Invest ($MDMG) | 19.9% | 9.5% | 11.0% | 11.8% | |
| Smith & Nephew ($SN.) | 22.0% | 18.6% | 14.7% | 11.1% | |
| Abbott Laboratories ($ABT) | 4.3% | 5.3% | 8.3% | 9.4% | |
| |
|---|
| Median (10 companies) | 6.5% | 7.9% | 10.0% | 9.2% | -51.3% |
|---|
| Omega Diagnostics Group ($ODX) | 3.6% | 2.0% | 3.6% | 3.6% | 3.3% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Synergy Health ($SYR) | 2.1x | 1.9x | 1.5x | 1.6x | |
| Smith & Nephew ($SN.) | 0.3x | 0.2x | 1.4x | 1.3x | |
| Abbott Laboratories ($ABT) | 2.1x | 0.8x | 0.9x | 0.9x | |
| Md Medical Group Invest ($MDMG) | 0.2x | 0.2x | 2.0x | 0.6x | |
| Lifeline Scientific Inc ($LSIC) | -4.4x | -0.6x | -0.3x | -1.0x | |
| |
|---|
| Median (8 companies) | 0.2x | -0.2x | -0.3x | -0.2x | |
|---|
| Omega Diagnostics Group ($ODX) | 0.1x | 0.7x | -1.8x | -1.0x | -0.7x |
