Walker Crips Group EBITDA dropped on 47.2% in 2016 and EBITDA Margin decreased on 3.5 pp from 6.5% to 3.0%
30 Jun 2016 • About Walker Crips Group (
$WCW) • By InTwits
Walker Crips Group reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Walker Crips Group doesn't have a profitable business model yet: FY2016 ROIC is -0.7%
- Walker Crips Group has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.9%. At the same time it's in pair with industry average of 1.9%.
- CAPEX is quite volatile: 0.25 in FY2016, 0.57 in FY2015, 0.54 in FY2014, 0.49 in FY2013, 0.20 in FY2012
- The company has unprofitable business model: ROIC is at -0.7%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Walker Crips Group ($WCW) key annual financial indicators
| mln. £ | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 20.306 | 20.372 | 20.688 | 22.994 | 26.070 | 13.4% |
| Gross Profit | 14.571 | 11.810 | 14.104 | 15.341 | 17.637 | 15.0% |
| SG&A | | | | 14.810 | 16.996 | 14.8% |
| EBITDA | 0.923 | -0.293 | | 1.489 | 0.786 | -47.2% |
| Net Income | 0.281 | 9.153 | 2.034 | 0.257 | 0.795 | 209.3% |
Balance Sheet
|
|---|
| Cash | 1.335 | 7.848 | 8.173 | 6.635 | 7.257 | 9.4% |
| Short Term Debt | 0.407 | 0.000 | 0.070 | 0.134 | 0.077 | -42.5% |
| Long Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
Cash flow
|
|---|
| Capex | 0.195 | 0.490 | 0.542 | 0.565 | 0.247 | -56.3% |
Ratios
|
|---|
| Revenue growth | 0.9% | 0.3% | 1.6% | 11.1% | 13.4% | |
| EBITDA growth | -56.6% | -131.7% | | | -47.2% | |
| Gross Margin | 71.8% | 58.0% | 68.2% | 66.7% | 67.7% | 0.9% |
| EBITDA Margin | 4.5% | -1.4% | 0.0% | 6.5% | 3.0% | -3.5% |
| Net Income Margin | 1.4% | 44.9% | 9.8% | 1.1% | 3.0% | 1.9% |
| SG&A, % of revenue | | | | 64.4% | 65.2% | 0.8% |
| CAPEX, % of revenue | 1.0% | 2.4% | 2.6% | 2.5% | 0.9% | -1.5% |
| ROIC | 3.6% | -6.2% | 2.2% | 4.0% | -0.7% | -4.7% |
| ROE | 2.0% | 55.6% | 9.9% | 1.2% | 3.8% | 2.6% |
| Net Debt/EBITDA | -1.0x | | | -4.4x | -9.1x | -4.8x |
Revenue and profitability
Walker Crips Group's Revenue jumped on 13.4% in FY2016. Revenue growth was financed by EBITDA margin decline. EBITDA Margin decreased on 3.5 pp from 6.5% to 3.0% in FY2016.
Gross Margin increased slightly on 0.94 pp from 66.7% to 67.7% in FY2016. SG&A as a % of Revenue increased slightly on 0.79 pp from 64.4% to 65.2% in FY2016.
Net Income marign increased slightly on 1.9 pp from 1.1% to 3.0% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 the company had CAPEX/Revenue of 0.95%. The company's CAPEX/Revenue decreased slightly on 1.5 pp from 2.4% in FY2013 to 0.95% in FY2016. It's average level of CAPEX/Revenue for the last three years was 2.0%.
Return on investment
The company operates at negative ROIC (-0.66%) and low but positive ROE (3.83%). ROIC decreased on 4.7 pp from 4.0% to -0.66% in FY2016. ROE increased on 2.6 pp from 1.2% to 3.8% in FY2016.
Leverage (Debt)
Debt level is -9.1x Net Debt / EBITDA and 0.1x Debt / EBITDA. Net Debt / EBITDA dropped on 4.8x from -4.4x to -9.1x in FY2016. Debt dropped on 42.5% in FY2016 while cash increased on 9.4% in FY2016.
Valuation
Walker Crips Group's trades at EV/EBITDA 13.3x and P/E 22.2x while industy averages are 15.6x and 19.1x. Walker Crips Group's EV/(EBITDA-CAPEX) is 19.4x with the industry average at 19.0x.
Appendix 1: Peers in Financial Services
Below you can find Walker Crips Group benchmarking vs. other companies in Financial 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 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Volvere ($VLE) | -47.1% | 149.8% | -23.2% | 124.9% | |
| Real Estate Credit Investments Pcc ($RECP) | | 335.8% | -59.6% | 47.3% | -29.8% |
| Fairpoint Group ($FRP) | 32.7% | -17.5% | 35.1% | 41.2% | |
| Afh Financial Group ($AFHP) | | 49.9% | 39.3% | 39.5% | |
| Manx Financial Group ($MFX) | 5.6% | 33.3% | 22.0% | 28.2% | |
| |
|---|
| Median (30 companies) | 5.6% | 14.7% | 6.8% | 2.7% | 2.3% |
|---|
| Walker Crips Group ($WCW) | | 0.3% | 1.6% | 11.1% | 13.4% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Record ($REC) | 98.8% | 98.8% | 99.6% | 99.3% | 99.0% |
| Panmure Gordon & Co ($PMR) | 95.2% | 95.0% | 95.3% | 95.2% | |
| First Property Group ($FPO) | 86.0% | 69.5% | 67.9% | 83.0% | 80.6% |
| Schroders ($SDRC) | 76.9% | 76.2% | 77.7% | 78.3% | |
| London Capital Group Hldgs ($LCG) | 64.2% | 70.5% | 73.6% | 67.9% | |
| |
|---|
| Median (15 companies) | 51.8% | 52.2% | 51.3% | 52.3% | 63.3% |
|---|
| Walker Crips Group ($WCW) | 71.8% | 58.0% | 68.2% | 66.7% | 67.7% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Livermore Investments Group Ltd ($LIV) | 84.9% | 64.8% | 78.8% | 83.5% | |
| Real Estate Credit Investments Pcc ($RECP) | 58.6% | 89.3% | 77.0% | 80.3% | 79.3% |
| Manx Financial Group ($MFX) | 39.8% | 49.2% | 56.5% | 58.8% | |
| Hargreaves Lansdown ($HL.) | 64.1% | 66.4% | 58.7% | 51.2% | |
| Daishin Securities Co ($DSS) | 53.8% | 51.5% | 38.8% | 49.2% | |
| |
|---|
| Median (28 companies) | 14.9% | 17.0% | 14.5% | 16.9% | 33.7% |
|---|
| Walker Crips Group ($WCW) | 4.5% | -1.4% | | 6.5% | 3.0% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| London Capital Group Hldgs ($LCG) | 1.8% | 0.2% | 3.4% | 7.7% | |
| Daishin Securities Co ($DSS) | 6.0% | 24.7% | 15.0% | 6.5% | |
| Commercial Bank Of Qatar(The) ($CBQS) | 6.0% | 3.8% | 2.8% | 3.9% | |
| Nmbz Hldgs ($NMB) | 6.1% | 3.0% | 2.1% | 3.8% | |
| Afh Financial Group ($AFHP) | 1.6% | 1.5% | 0.7% | 3.8% | |
| |
|---|
| Median (29 companies) | 1.4% | 1.3% | 1.3% | 0.9% | 0.8% |
|---|
| Walker Crips Group ($WCW) | 1.0% | 2.4% | 2.6% | 2.5% | 0.9% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Hargreaves Lansdown ($HL.) | 108.7% | 111.7% | 101.0% | 87.5% | |
| Manx Financial Group ($MFX) | 8.0% | 19.7% | 29.7% | 40.2% | |
| Record ($REC) | 23.8% | 19.6% | 20.2% | 20.2% | 18.5% |
| Impax Asset Management Group ($IPX) | -13.7% | 17.2% | 18.7% | 16.1% | |
| Lighthouse Group ($LGT) | 7.2% | -3.9% | 8.6% | 14.6% | |
| |
|---|
| Median (30 companies) | 5.5% | 6.3% | 9.2% | 7.7% | 11.1% |
|---|
| Walker Crips Group ($WCW) | 3.6% | -6.2% | 2.2% | 4.0% | -0.7% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Private & Commercial Finance Group ($PCF) | 12.8x | 14.3x | 13.9x | 12.9x | 10.6x |
| First Property Group ($FPO) | 3.6x | 3.0x | 5.6x | 12.3x | 9.4x |
| Canaccord Genuity Group Inc ($CF.) | | | | 10.2x | |
| Daishin Securities Co ($DSS) | 1.5x | 2.4x | 10.7x | 8.0x | |
| S & U ($46IE) | 1.4x | 1.3x | 1.7x | 3.1x | 0.5x |
| |
|---|
| Median (25 companies) | -1.2x | -1.4x | -2.1x | -0.5x | 0.1x |
|---|
| Walker Crips Group ($WCW) | -1.0x | | | -4.4x | -9.1x |
