Ab Dynamics reports 133% CAPEX growth and 23.9% Revenue growth
16 Nov 2016 • About Ab Dynamics (
$ABDP) • By InTwits
Ab Dynamics reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Ab Dynamics is a fast growth stock: FY2016 revenue growth was 23.9%, 5 year revenue CAGR was 25.8% at FY2016 ROIC 28.0%
- Ab Dynamics has low CAPEX intensity: 5 year average CAPEX/Revenue was 4.5%. At the same time it's a lot of higher than industry average of 3.5%.
- CAPEX is quite volatile: 1.6 in FY2016, 0.69 in FY2015, 0.34 in FY2014, 0.68 in FY2013, 0.20 in FY2012
- The company has highly profitable business model: ROIC is at 28.0%
- It operates with high leverage: Net Debt/EBITDA is -2.2x while industry average is -34.3x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Ab Dynamics ($ABDP) key annual financial indicators
| mln. £ | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 8.900 | 12.171 | 13.847 | 16.523 | 20.472 | 23.9% |
| Gross Profit | 2.500 | 3.123 | 4.030 | 5.350 | 6.176 | 15.4% |
| SG&A | | 0.914 | 1.379 | 1.643 | 1.636 | -0.4% |
| EBITDA | 1.900 | 2.300 | 2.787 | 3.958 | 4.656 | 17.6% |
| Net Income | 1.400 | 1.423 | 2.152 | 3.246 | 3.874 | 19.4% |
Balance Sheet
|
|---|
| Cash | 2.500 | 5.990 | 4.896 | 7.968 | 10.405 | 30.6% |
| 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 | 0.200 | 0.678 | 0.345 | 0.691 | 1.609 | 132.7% |
Ratios
|
|---|
| Revenue growth | 36.9% | 36.8% | 13.8% | 19.3% | 23.9% | |
| EBITDA growth | 137.5% | 21.1% | 21.2% | 42.0% | 17.6% | |
| Gross Margin | 28.1% | 25.7% | 29.1% | 32.4% | 30.2% | -2.2% |
| EBITDA Margin | 21.3% | 18.9% | 20.1% | 24.0% | 22.7% | -1.2% |
| Net Income Margin | 15.7% | 11.7% | 15.5% | 19.6% | 18.9% | -0.7% |
| SG&A, % of revenue | | 7.5% | 10.0% | 9.9% | 8.0% | -2.0% |
| CAPEX, % of revenue | 2.2% | 5.6% | 2.5% | 4.2% | 7.9% | 3.7% |
| ROIC | 44.4% | 34.3% | 28.4% | 31.4% | 28.0% | -3.4% |
| ROE | 34.6% | 22.2% | 23.2% | 27.1% | 24.9% | -2.2% |
| Net Debt/EBITDA | -1.3x | -2.6x | -1.8x | -2.0x | -2.2x | -0.2x |
Revenue and profitability
Ab Dynamics's Revenue surged on 23.9% in FY2016. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin jumped on 45.7 pp from -71.9% to -26.2% in FY2016.
Gross Margin decreased on 2.2 pp from 32.4% to 30.2% in FY2016. SG&A as a % of Revenue decreased slightly on 2.0 pp from 9.9% to 8.0% in FY2016.
Net Income marign decreased slightly on 0.72 pp from 19.6% to 18.9% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 Ab Dynamics had CAPEX/Revenue of 7.9%. CAPEX/Revenue increased on 2.3 pp from 5.6% in FY2013 to 7.9% in FY2016. For the last three years the average CAPEX/Revenue was 4.8%.
Return on investment
The company operates at high and attractive ROIC (28.04%) and ROE (24.86%). ROIC decreased on 3.4 pp from 31.4% to 28.0% in FY2016. ROE decreased on 2.2 pp from 27.1% to 24.9% in FY2016.
Leverage (Debt)
The company has no debt. Cash jumped on 30.6% in FY2016.
Valuation
Ab Dynamics's trades at EV/EBITDA 14.9x and P/E 20.5x while industy averages are 15.6x and 19.1x. Ab Dynamics's EV/(EBITDA-CAPEX) is 22.7x with the industry average at 19.0x.
Appendix 1: Peers in Industrial Engineering
Below you can find Ab Dynamics benchmarking vs. other companies in Industrial Engineering 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 |
|---|
| Slingsby(H.C.) ($SLNG) | -4.2% | -4.3% | -9.9% | 35.5% | |
| Mincon Group ($MCON) | 53.5% | -17.1% | 4.2% | 28.8% | |
| Flowtech Fluidpower ($FLO) | -5.8% | -5.1% | 17.7% | 18.7% | |
| Somero Enterprise Inc ($SOMA) | 47.1% | 40.1% | 31.5% | 18.5% | |
| Hydro International ($HYD) | 11.7% | -7.2% | -0.1% | 17.7% | |
| |
|---|
| Median (23 companies) | 11.7% | 2.9% | -0.0% | 0.3% | -2.2% |
|---|
| Ab Dynamics ($ABDP) | | 36.8% | 13.8% | 19.3% | 23.9% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Somero Enterprise Inc ($SOMA) | 48.7% | 52.2% | 54.0% | 55.8% | |
| Hydro International ($HYD) | 37.3% | 39.4% | 45.3% | 46.4% | |
| Rotork ($76ID) | 46.8% | 47.4% | 48.0% | 45.7% | 44.3% |
| Northbridge Industrial Services ($NBI) | 57.0% | 54.0% | 48.4% | 43.4% | |
| Amiad Water Systems Ltd ($AFS) | 42.8% | 40.8% | 38.9% | 40.5% | |
| |
|---|
| Median (21 companies) | 31.3% | 30.0% | 33.2% | 34.2% | 30.1% |
|---|
| Ab Dynamics ($ABDP) | 28.1% | 25.7% | 29.1% | 32.4% | 30.2% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Northbridge Industrial Services ($NBI) | 30.3% | 29.2% | 32.4% | 32.5% | |
| Somero Enterprise Inc ($SOMA) | 12.6% | 23.9% | 27.4% | 28.2% | |
| Rotork ($76ID) | 27.0% | 27.6% | 28.0% | 25.0% | 22.8% |
| Mincon Group ($MCON) | 22.9% | 30.0% | 22.7% | 17.6% | |
| Hms Hydraulic Mach & Sys Grp ($HMSG) | 16.5% | 17.0% | 7.5% | 16.0% | |
| |
|---|
| Median (23 companies) | 8.6% | 8.0% | 7.4% | 7.9% | 8.8% |
|---|
| Ab Dynamics ($ABDP) | 21.3% | 18.9% | 20.1% | 24.0% | 22.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Pressure Technologies ($PRES) | 2.4% | 2.3% | 3.3% | 11.6% | |
| Somero Enterprise Inc ($SOMA) | 1.7% | 1.8% | 2.1% | 5.9% | |
| Mitsubishi Electric Corp ($MEL) | 4.4% | 4.2% | 3.7% | 4.6% | 4.1% |
| Braime(T.F.& J.H.)(Hldgs) ($BMTO) | 2.3% | 9.6% | 5.6% | 3.8% | |
| Hms Hydraulic Mach & Sys Grp ($HMSG) | 4.4% | 4.5% | 3.6% | 3.7% | |
| |
|---|
| Median (23 companies) | 2.4% | 2.0% | 2.4% | 2.2% | 4.2% |
|---|
| Ab Dynamics ($ABDP) | 2.2% | 5.6% | 2.5% | 4.2% | 7.9% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Somero Enterprise Inc ($SOMA) | 6.0% | 34.1% | 51.7% | 54.3% | |
| Energy Technique ($ETQ) | 18.9% | 19.3% | 47.5% | 41.6% | |
| Renold ($RNO) | 18.8% | -12.7% | -2.5% | 41.3% | 39.1% |
| Rotork ($76ID) | 50.0% | 45.4% | 38.1% | 21.9% | 17.0% |
| Hms Hydraulic Mach & Sys Grp ($HMSG) | 17.5% | 14.7% | 3.2% | 14.7% | |
| |
|---|
| Median (23 companies) | 13.5% | 11.4% | 10.8% | 8.8% | 4.3% |
|---|
| Ab Dynamics ($ABDP) | 44.4% | 34.3% | 28.4% | 31.4% | 28.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Tricorn Group ($TCN) | -0.3x | 0.9x | 5.8x | 4.0x | 7.2x |
| Slingsby(H.C.) ($SLNG) | -3.3x | -4.6x | -3.7x | 3.7x | |
| Avingtrans ($AVG) | 3.1x | 0.7x | 1.2x | 3.6x | -22.4x |
| 600 Group ($SIXH) | | 3.2x | 2.2x | 3.1x | |
| Chamberlin ($CMH) | 0.5x | 0.4x | | 2.2x | 2.2x |
| |
|---|
| Median (23 companies) | 0.5x | 0.6x | 0.6x | 1.1x | 0.4x |
|---|
| Ab Dynamics ($ABDP) | -1.3x | -2.6x | -1.8x | -2.0x | -2.2x |
