Interquest Group EBITDA dropped on 97.9% in 2016 and Revenue decreased on 9.5%
14 Mar 2017 • About Interquest Group (
$ITQ) • By InTwits
Interquest Group reported 2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Interquest Group doesn't have a profitable business model yet: 2016 ROIC is -2.1%
- EBITDA Margin is quite volatile: 0.1% in 2016, 3.7% in 2015, 3.0% in 2014, 2.1% in 2013, 1.8% in 2012
- Interquest Group has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.2%.
- The company has unprofitable business model: ROIC is at -2.1%
- It operates with high leverage: Net Debt/EBITDA is 45.5x while industry average is 1.8x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Interquest Group ($ITQ) key annual financial indicators
| mln. £ | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 112.7 | 114.9 | 150.6 | 158.6 | 143.6 | -9.5% |
| Gross Profit | 16.4 | 17.4 | 23.2 | 23.8 | 21.7 | -8.7% |
| SG&A | | | 19.5 | 18.9 | 18.4 | -2.4% |
| EBITDA | 2.0 | 2.4 | 4.6 | 5.8 | 0.1 | -97.9% |
| Net Income | -0.1 | 1.0 | 2.0 | 3.0 | -1.3 | -142.9% |
Balance Sheet
|
|---|
| Cash | 0.6 | 1.1 | 1.3 | 1.2 | 1.5 | 30.5% |
| Short Term Debt | 5.0 | 10.1 | 9.6 | 7.2 | 7.1 | -1.2% |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 0.2 | 0.3 | 0.5 | 0.1 | 0.3 | 102.2% |
Ratios
|
|---|
| Revenue growth | -6.8% | 2.0% | 31.2% | 5.3% | -9.5% | |
| EBITDA growth | -71.5% | 23.8% | 86.8% | 26.9% | -97.9% | |
| Gross Margin | 14.5% | 15.1% | 15.4% | 15.0% | 15.1% | 0.1% |
| EBITDA Margin | 1.8% | 2.1% | 3.0% | 3.7% | 0.1% | -3.6% |
| Net Income Margin | -0.1% | 0.8% | 1.3% | 1.9% | -0.9% | -2.8% |
| SG&A, % of revenue | | | 13.0% | 11.9% | 12.8% | 0.9% |
| CAPEX, % of revenue | 0.2% | 0.3% | 0.3% | 0.1% | 0.2% | 0.1% |
| ROIC | 4.7% | 7.7% | 11.9% | 15.5% | -2.1% | -17.6% |
| ROE | -0.7% | 4.9% | 9.3% | 13.2% | -5.7% | -18.9% |
| Net Debt/EBITDA | 2.2x | 3.7x | 1.8x | 1.0x | 45.5x | 44.5x |
Revenue and profitability
Interquest Group's Revenue decreased on 9.5% in 2016. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 3.6 pp from 3.7% to 0.085% in 2016.
Gross Margin showed almost no change in 2016. SG&A as a % of Revenue increased slightly on 0.93 pp from 11.9% to 12.8% in 2016.
Net Income marign decreased on 2.8 pp from 1.9% to -0.90% in 2016.
Capital expenditures (CAPEX) and working capital investments
Interquest Group's CAPEX/Revenue was 0.19% in 2016. The company's CAPEX/Revenue showed almost no change from 2013 to 2016. Average CAPEX/Revenue for the last three years was 0.20%.Battling declining revenue Interquest Group made large investments to CAPEX (229% of EBITDA) but that didn't help at least in this year.
Return on investment
The company operates at negative ROIC (-2.05%) and ROE (-5.72%). ROIC dropped on 17.6 pp from 15.5% to -2.1% in 2016. ROE dropped on 18.9 pp from 13.2% to -5.7% in 2016.
Leverage (Debt)
Debt level is 45.5x Net Debt / EBITDA and 58.1x Debt / EBITDA. Net Debt / EBITDA surged on 44.5x from 1.0x to 45.5x in 2016. Debt decreased slightly on 1.2% in 2016 while cash surged on 30.5% in 2016.
Appendix 1: Peers in Support Services
Below we provide Interquest Group benchmarking against other companies in Support 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 |
|---|
| Camco Clean Energy ($CCE) | | 88.0% | -54.7% | 99.4% | |
| Optimal Payments ($OPAY) | | 41.5% | 44.0% | 68.1% | 63.1% |
| Inspired Energy ($INSE) | 83.8% | 44.8% | 42.2% | 40.2% | |
| 21St Century Technology ($C21) | 0.1% | -22.8% | -16.6% | 35.5% | |
| Ibex Global Solutions ($IBEX) | | 35.7% | 30.0% | 29.8% | 7.0% |
| |
|---|
| Median (55 companies) | 2.4% | 8.0% | 4.7% | 6.9% | 4.5% |
|---|
| Interquest Group ($ITQ) | | 2.0% | 31.2% | 5.3% | -9.5% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Inspired Energy ($INSE) | 94.6% | 86.8% | 78.7% | 76.2% | |
| Ienergizer Ltd ($IBPO) | 56.2% | 78.4% | 76.8% | 72.7% | 71.3% |
| Grafenia ($GRA) | 53.4% | 54.3% | 56.1% | 70.8% | 66.3% |
| Vianet Group ($VNET) | 53.3% | 51.3% | 58.8% | 69.2% | 70.1% |
| Prime People ($PRP) | 63.4% | 58.3% | 57.7% | 61.4% | 59.2% |
| |
|---|
| Median (49 companies) | 29.5% | 28.8% | 30.4% | 28.7% | 27.1% |
|---|
| Interquest Group ($ITQ) | 14.5% | 15.1% | 15.4% | 15.0% | 15.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| 21St Century Technology ($C21) | 13.4% | -0.2% | 36.0% | 44.8% | |
| Northgate ($67GX) | 41.2% | 40.4% | 40.6% | 39.4% | 38.3% |
| Inspired Energy ($INSE) | 46.2% | 48.5% | 1.5% | 35.4% | |
| Vianet Group ($VNET) | 18.6% | 17.3% | 19.7% | 27.1% | 22.1% |
| Vp ($VP.) | 23.9% | 24.5% | 24.2% | 26.2% | 28.4% |
| |
|---|
| Median (55 companies) | 6.8% | 6.4% | 6.9% | 7.6% | 7.3% |
|---|
| Interquest Group ($ITQ) | 1.8% | 2.1% | 3.0% | 3.7% | 0.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Vp ($VP.) | 21.4% | 17.7% | 21.6% | 25.7% | 24.1% |
| Sagentia Group ($SAG) | 1.9% | 1.4% | 1.5% | 25.2% | 6.6% |
| Nature Group ($NGR) | 14.3% | 7.2% | 5.6% | 22.9% | |
| Augean ($AUG) | 9.8% | 15.9% | 12.3% | 12.3% | |
| Falkland Islands Hldgs ($FKL) | 3.7% | 6.8% | 12.9% | 11.9% | 4.8% |
| |
|---|
| Median (55 companies) | 1.1% | 1.1% | 1.1% | 1.1% | 1.1% |
|---|
| Interquest Group ($ITQ) | 0.2% | 0.3% | 0.3% | 0.1% | 0.2% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| 21St Century Technology ($C21) | 20.3% | -2.9% | 45.6% | 111.0% | |
| Inspired Energy ($INSE) | 63.9% | 65.5% | -7.5% | 28.0% | |
| Petards Group ($PEG) | 35.5% | -78.0% | 24.7% | 23.9% | 22.7% |
| Servoca ($SVCA) | 1.0% | 7.8% | 14.9% | 22.3% | 22.8% |
| Rtc Group ($RTC) | 14.6% | 17.6% | 19.9% | 22.2% | 15.4% |
| |
|---|
| Median (55 companies) | 9.9% | 7.9% | 9.3% | 10.2% | 11.5% |
|---|
| Interquest Group ($ITQ) | 4.7% | 7.7% | 11.9% | 15.5% | -2.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Redhall Group ($RHL) | 22.8x | 5.8x | 6.6x | 16.8x | 16.2x |
| Mitsubishi Corp ($MBC) | 9.9x | 15.9x | 14.3x | 12.5x | 25.0x |
| Ienergizer Ltd ($IBPO) | 6.3x | 2.8x | 3.0x | 4.0x | 2.4x |
| Ceps ($CEPS) | | 3.0x | 6.6x | 3.8x | |
| Kellan Group(The ($KLN) | | | 6.5x | 3.6x | |
| |
|---|
| Median (51 companies) | 0.8x | 0.5x | 0.6x | 0.4x | 0.5x |
|---|
| Interquest Group ($ITQ) | 2.2x | 3.7x | 1.8x | 1.0x | 45.5x |
