Airea Net Income surged on 120% in 2016 and EBITDA Margin increased on 3.7 pp from 8.0% to 11.7%
08 Sep 2016 • About Airea (
$AIEA) • By InTwits
Airea reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Airea is a company in decline: FY2016 revenue growth was -3.8%, 5 years revenue CAGR was -3.2%
- Airea has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.8%. At the same time it's in pair with industry average of 2.3%.
- CAPEX is quite volatile: 0.70 in FY2016, 0.46 in FY2015, 0.15 in FY2014, 0.26 in FY2013, 0.71 in FY2012
- The company has highly profitable business model: ROIC is at 18.2%
- It operates with high leverage: Net Debt/EBITDA is -1.1x while industry average is -1.6x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Airea ($AIEA) key annual financial indicators
| mln. £ | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 26.276 | 25.049 | 22.951 | 25.538 | 24.577 | -3.8% |
| EBITDA | 1.539 | 1.846 | 1.598 | 2.042 | 2.879 | 41.0% |
| Net Income | 0.269 | 0.080 | 0.301 | 0.581 | 1.277 | 119.8% |
Balance Sheet
|
|---|
| Cash | 1.342 | 2.747 | 1.930 | 1.883 | 3.114 | 65.4% |
| Short Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
| Long Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
Cash flow
|
|---|
| Capex | 0.708 | 0.257 | 0.153 | 0.459 | 0.704 | 53.4% |
Ratios
|
|---|
| Revenue growth | -9.1% | -4.7% | -8.4% | 11.3% | -3.8% | |
| EBITDA growth | -22.7% | 19.9% | -13.4% | 27.8% | 41.0% | |
| EBITDA Margin | 5.9% | 7.4% | 7.0% | 8.0% | 11.7% | 3.7% |
| Net Income Margin | 1.0% | 0.3% | 1.3% | 2.3% | 5.2% | 2.9% |
| CAPEX, % of revenue | 2.7% | 1.0% | 0.7% | 1.8% | 2.9% | 1.1% |
| ROIC | 3.3% | 7.2% | 6.4% | 11.7% | 18.2% | 6.5% |
| ROE | 2.0% | 0.7% | 2.4% | 4.9% | 10.2% | 5.3% |
| Net Debt/EBITDA | -0.9x | -1.5x | -1.2x | -0.9x | -1.1x | -0.2x |
Revenue and profitability
Airea's Revenue decreased on 3.8% in FY2016. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 3.7 pp from 8.0% to 11.7% in FY2016.
Net Income marign increased on 2.9 pp from 2.3% to 5.2% in FY2016.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 2.9% in FY2016. The company's CAPEX/Revenue increased slightly on 1.8 pp from 1.0% in FY2013 to 2.9% in FY2016. For the last three years the average CAPEX/Revenue was 1.8%.
Return on investment
The company operates at good ROIC (18.19%) while ROE is low (10.20%). ROIC increased on 6.5 pp from 11.7% to 18.2% in FY2016. ROE increased on 5.3 pp from 4.9% to 10.2% in FY2016.
Leverage (Debt)
The company has no debt. Cash jumped on 65.4% in FY2016.
Appendix 1: Peers in Household Goods & Home Construction
Below you can find Airea benchmarking vs. other companies in Household Goods & Home Construction 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 |
|---|
| Abbey ($ABBY) | | 40.0% | 15.9% | 51.0% | 27.9% |
| Taylor Wimpey ($TW.) | 11.7% | 13.7% | 17.0% | 16.9% | |
| Reckitt Benckiser Group ($RB.) | 0.9% | -3.1% | -4.6% | 0.4% | |
| Colefax Group ($CFX) | | 0.3% | 10.5% | -1.6% | 0.1% |
| Teco Electric & Machinery Co Ltd ($TECD) | 4.1% | 16.2% | -5.1% | -9.6% | |
| |
|---|
| Median (7 companies) | 4.1% | 13.7% | -4.6% | -1.6% | 14.0% |
|---|
| Airea ($AIEA) | | -4.7% | -8.4% | 11.3% | -3.8% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Reckitt Benckiser Group ($RB.) | 57.9% | 56.7% | 57.7% | 59.1% | |
| Colefax Group ($CFX) | 55.1% | 55.4% | 53.3% | 54.7% | 56.3% |
| Abbey ($ABBY) | 23.6% | 17.3% | 25.8% | 30.6% | 33.1% |
| Teco Electric & Machinery Co Ltd ($TECD) | 23.5% | 23.8% | 24.9% | 25.5% | |
| Taylor Wimpey ($TW.) | 17.6% | 21.6% | 23.8% | 25.1% | |
| |
|---|
| Median (7 companies) | 23.5% | 21.6% | 24.9% | 25.5% | 44.7% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Abbey ($ABBY) | 19.4% | 13.3% | 22.6% | 31.2% | 31.7% |
| Reckitt Benckiser Group ($RB.) | 27.1% | 22.0% | 26.3% | 27.2% | |
| Taylor Wimpey ($TW.) | 11.2% | 15.6% | 18.6% | 20.2% | |
| Teco Electric & Machinery Co Ltd ($TECD) | 10.8% | 10.7% | 10.7% | 10.5% | |
| Colefax Group ($CFX) | 6.6% | 7.6% | 9.1% | 8.7% | 9.4% |
| |
|---|
| Median (7 companies) | 10.8% | 10.7% | 10.7% | 10.5% | 20.5% |
|---|
| Airea ($AIEA) | 5.9% | 7.4% | 7.0% | 8.0% | 11.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Abbey ($ABBY) | 12.2% | 6.5% | 8.0% | 8.0% | 5.3% |
| Teco Electric & Machinery Co Ltd ($TECD) | 1.4% | 1.4% | 3.6% | 3.5% | |
| Colefax Group ($CFX) | 4.9% | 3.1% | 2.0% | 2.9% | 3.0% |
| Reckitt Benckiser Group ($RB.) | 1.7% | 2.1% | 1.8% | 1.7% | |
| Havelock Europa ($HVE) | 0.1% | 1.3% | 0.2% | 1.0% | |
| |
|---|
| Median (7 companies) | 1.7% | 1.4% | 1.8% | 1.7% | 4.2% |
|---|
| Airea ($AIEA) | 2.7% | 1.0% | 0.7% | 1.8% | 2.9% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Taylor Wimpey ($TW.) | 12.2% | 17.7% | 21.7% | 24.1% | |
| Abbey ($ABBY) | 5.4% | 4.7% | 11.2% | 21.1% | 22.9% |
| Colefax Group ($CFX) | 10.7% | 13.5% | 22.0% | 20.6% | 20.2% |
| Reckitt Benckiser Group ($RB.) | 23.3% | 17.3% | 19.7% | 20.3% | |
| Teco Electric & Machinery Co Ltd ($TECD) | 7.1% | 8.3% | 7.3% | 5.8% | |
| |
|---|
| Median (7 companies) | 7.1% | 8.3% | 11.2% | 20.3% | 21.5% |
|---|
| Airea ($AIEA) | 3.3% | 7.2% | 6.4% | 11.7% | 18.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Reckitt Benckiser Group ($RB.) | 0.9x | 1.0x | 0.7x | 0.7x | |
| Teco Electric & Machinery Co Ltd ($TECD) | 0.1x | -0.9x | -1.3x | -0.3x | |
| Taylor Wimpey ($TW.) | 0.3x | -0.0x | -0.2x | -0.4x | |
| Colefax Group ($CFX) | -1.8x | -1.4x | -0.6x | -1.0x | -1.4x |
| Abbey ($ABBY) | -1.5x | -2.6x | -1.2x | -1.3x | -1.3x |
| |
|---|
| Median (6 companies) | 0.2x | -0.5x | -0.6x | -0.7x | -1.3x |
|---|
| Airea ($AIEA) | -0.9x | -1.5x | -1.2x | -0.9x | -1.1x |
