Zytronic EBITDA decreased on 8.8% in 2016 and EBITDA Margin decreased on 2.2 pp from 27.8% to 25.6%
13 Dec 2016 • About Zytronic (
$ZYT) • By InTwits
Zytronic reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Zytronic has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.9%. At the same time it's a lot of higher than industry average of 1.9%.
- CAPEX is quite volatile: 0.39 in FY2016, 0.99 in FY2015, 0.26 in FY2014, 0.49 in FY2013, 0.73 in FY2012
- The company has highly profitable business model: ROIC is at 18.1%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Zytronic ($ZYT) key annual financial indicators
| mln. £ | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 20.424 | 17.282 | 18.886 | 21.267 | 21.087 | -0.8% |
| Gross Profit | 7.416 | 5.321 | 6.907 | 8.901 | 9.016 | 1.3% |
| SG&A | | | | 4.351 | 4.365 | 0.3% |
| EBITDA | 5.170 | 3.250 | 4.317 | 5.913 | 5.394 | -8.8% |
| Net Income | 3.297 | 1.662 | 2.960 | 3.769 | 4.087 | 8.4% |
Balance Sheet
|
|---|
| Cash | 4.217 | 5.474 | 7.806 | 9.833 | 12.763 | 29.8% |
| Short Term Debt | 0.200 | 0.200 | 0.200 | 0.200 | 1.148 | 474.0% |
| Long Term Debt | 1.735 | 1.538 | 1.341 | 1.144 | 0.000 | -100.0% |
Cash flow
|
|---|
| Capex | 0.732 | 0.492 | 0.263 | 0.994 | 0.387 | -61.1% |
Ratios
|
|---|
| Revenue growth | -0.3% | -15.4% | 9.3% | 12.6% | -0.8% | |
| EBITDA growth | 6.6% | -37.1% | 32.8% | 37.0% | -8.8% | |
| Gross Margin | 36.3% | 30.8% | 36.6% | 41.9% | 42.8% | 0.9% |
| EBITDA Margin | 25.3% | 18.8% | 22.9% | 27.8% | 25.6% | -2.2% |
| Net Income Margin | 16.1% | 9.6% | 15.7% | 17.7% | 19.4% | 1.7% |
| SG&A, % of revenue | | | | 20.5% | 20.7% | 0.2% |
| CAPEX, % of revenue | 3.6% | 2.8% | 1.4% | 4.7% | 1.8% | -2.8% |
| ROIC | 23.0% | 11.9% | 17.0% | 22.7% | 18.1% | -4.7% |
| ROE | 23.0% | 10.5% | 17.3% | 19.5% | 18.6% | -0.8% |
| Net Debt/EBITDA | -0.4x | -1.1x | -1.5x | -1.4x | -2.2x | -0.7x |
Revenue and profitability
Zytronic's Revenue decreased slightly on 0.85% in FY2016. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 2.2 pp from 27.8% to 25.6% in FY2016.
Gross Margin increased slightly on 0.90 pp from 41.9% to 42.8% in FY2016. SG&A as a % of Revenue showed almost no change in FY2016.
Net Income marign increased slightly on 1.7 pp from 17.7% to 19.4% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 Zytronic had CAPEX/Revenue of 1.8%. CAPEX/Revenue decreased slightly on 1.0 pp from 2.8% in FY2013 to 1.8% in FY2016. Average CAPEX/Revenue for the last three years was 2.6%.
Return on investment
The company operates at good ROIC (18.08%) and ROE (18.61%). ROIC decreased on 4.7 pp from 22.7% to 18.1% in FY2016. ROE decreased slightly on 0.85 pp from 19.5% to 18.6% in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is -2.2x and Debt / EBITDA is 0.2x. Net Debt / EBITDA dropped on 0.7x from -1.4x to -2.2x in FY2016. Debt dropped on 14.6% in FY2016 while cash jumped on 29.8% in FY2016.
Valuation
The company's trades at EV/EBITDA 8.6x and P/E 14.1x while industy averages are 15.6x and 19.1x. Zytronic's EV/(EBITDA-CAPEX) is 9.2x with the industry average at 19.0x.
Appendix 1: Peers in Electronic & Electrical Equipment
Below you can find Zytronic benchmarking vs. other companies in Electronic & Electrical Equipment 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 |
|---|
| Stadium Group ($SDM) | -8.8% | 3.0% | -1.1% | 29.0% | |
| Flowgroup ($FLOW) | -92.9% | 125,263.6% | 141.9% | 21.1% | |
| Solid State ($SSP) | | 21.7% | 1.9% | 13.9% | 20.6% |
| Apc Technology Group ($APC) | -5.4% | 58.7% | -4.7% | 10.4% | |
| Volex ($VLX) | | -8.6% | -15.4% | 5.8% | -13.2% |
| |
|---|
| Median (13 companies) | -8.8% | -4.9% | -3.8% | -1.4% | 0.1% |
|---|
| Zytronic ($ZYT) | | -15.4% | 9.3% | 12.6% | -0.8% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Elektron Technology ($EKT) | 40.6% | 37.5% | 34.8% | 35.6% | 37.2% |
| Solid State ($SSP) | 27.8% | 26.1% | 29.2% | 30.5% | 31.8% |
| Maruwa Co Ltd ($MAW) | 31.6% | 28.6% | 32.8% | 30.0% | 35.9% |
| Lpa Group ($LPA) | 28.3% | 27.2% | 29.6% | 27.4% | |
| Holders Technology ($HDT) | 24.6% | 29.3% | 24.1% | 25.0% | |
| |
|---|
| Median (11 companies) | 27.3% | 26.1% | 24.1% | 23.2% | 33.9% |
|---|
| Zytronic ($ZYT) | 36.3% | 30.8% | 36.6% | 41.9% | 42.8% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Maruwa Co Ltd ($MAW) | 22.3% | 17.7% | 17.8% | 14.7% | 19.6% |
| Dewhurst ($DWHA) | 12.9% | 12.6% | 13.7% | 14.7% | 13.4% |
| Morgan Advanced Materials ($BA29) | 13.7% | 13.1% | 9.8% | 12.8% | 14.6% |
| Stadium Group ($SDM) | 6.1% | 7.1% | 9.9% | 12.1% | |
| Solid State ($SSP) | 6.7% | 6.3% | 17.3% | 9.7% | 11.2% |
| |
|---|
| Median (13 companies) | 6.6% | 5.3% | 4.5% | 4.4% | 12.3% |
|---|
| Zytronic ($ZYT) | 25.3% | 18.8% | 22.9% | 27.8% | 25.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Morgan Advanced Materials ($BA29) | 2.9% | 3.8% | 3.7% | 7.0% | 4.0% |
| Maruwa Co Ltd ($MAW) | 23.8% | 15.3% | 7.6% | 6.5% | 4.4% |
| Stadium Group ($SDM) | 1.0% | 0.8% | 0.5% | 2.7% | |
| Dewhurst ($DWHA) | 2.7% | 1.3% | 0.9% | 1.9% | 1.9% |
| Lpa Group ($LPA) | 9.1% | 2.0% | 14.8% | 1.8% | |
| |
|---|
| Median (13 companies) | 2.9% | 2.0% | 1.3% | 1.4% | 2.0% |
|---|
| Zytronic ($ZYT) | 3.6% | 2.8% | 1.4% | 4.7% | 1.8% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Dewhurst ($DWHA) | 29.2% | 20.7% | 24.5% | 27.3% | 24.6% |
| Solid State ($SSP) | 22.3% | 19.7% | 44.5% | 20.0% | 23.0% |
| Stadium Group ($SDM) | 16.5% | 17.6% | 17.3% | 19.3% | |
| Morgan Advanced Materials ($BA29) | 17.9% | 16.3% | 10.9% | 18.4% | 21.9% |
| Elektron Technology ($EKT) | 24.1% | 7.9% | 3.3% | 9.9% | 7.0% |
| |
|---|
| Median (13 companies) | 13.8% | 6.7% | 4.7% | 3.9% | 15.4% |
|---|
| Zytronic ($ZYT) | 23.0% | 11.9% | 17.0% | 22.7% | 18.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Walsin Lihwa Corp ($WALS) | 5.3x | 8.7x | 3.9x | 4.6x | |
| Lpa Group ($LPA) | 1.9x | 0.7x | 1.5x | 3.8x | |
| Morgan Advanced Materials ($BA29) | 1.4x | 1.5x | 2.3x | 1.8x | 1.7x |
| Elektron Technology ($EKT) | 0.7x | 1.7x | 3.8x | 0.8x | 0.5x |
| Solid State ($SSP) | 1.4x | 1.2x | 0.4x | 0.7x | 0.7x |
| |
|---|
| Median (9 companies) | 1.0x | 0.9x | 1.4x | 0.7x | 0.4x |
|---|
| Zytronic ($ZYT) | -0.4x | -1.1x | -1.5x | -1.4x | -2.2x |
