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IMImobile Net Income surged on 33.9% in 2017 and Revenue jumped on 23.5%

28 Jun 2017 • About IMImobile ($IMO) • By InTwits

IMImobile reported FY2017 financial results today. Overall looking at the company's long term financial model we can say that:
  • IMImobile is a growth stock: FY2017 revenue growth was 23.5%, 5 year revenue CAGR was 14.5% at FY2017 ROIC 10.6%
  • EBITDA Margin is quite volatile: 11.0% in FY2017, 11.1% in FY2016, 5.4% in FY2015, 16.4% in FY2014, 14.6% in FY2013
  • IMImobile has low CAPEX intensity: 5 year average CAPEX/Revenue was 3.0%. At the same time it's a lot of higher than industry average of 2.2%.
  • The company has business model with average profitability: ROIC is at 10.6%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.

IMImobile ($IMO) key annual financial indicators

mln. £201320142015201620172017/2016
P&L
Revenue38.52943.40448.87661.63076.11623.5%
Gross Profit23.54627.89930.02836.52243.37018.8%
SG&A23.004
EBITDA5.6217.1062.6196.8468.39622.6%
Net Income2.1023.919-5.9753.4104.56533.9%
Balance Sheet
Cash4.6439.30514.61715.03914.662-2.5%
Short Term Debt1.3200.0000.0000.0000.196
Long Term Debt0.00010.8950.0000.0000.644
Cash flow
Capex1.2891.6830.9672.0062.1245.9%
Ratios
Revenue growth-0.3%12.7%12.6%26.1%23.5%
EBITDA growth1.7%26.4%-63.1%161.4%22.6%
Gross Margin61.1%64.3%61.4%59.3%57.0%-2.3%
EBITDA Margin14.6%16.4%5.4%11.1%11.0%-0.1%
Net Income Margin5.5%9.0%-12.2%5.5%6.0%0.5%
SG&A, % of revenue53.0%0.0%
CAPEX, % of revenue3.3%3.9%2.0%3.3%2.8%-0.5%
ROIC27.6%27.2%0.5%9.7%10.6%0.8%
ROE25.4%32.8%-27.6%10.6%10.6%0.1%
Net Debt/EBITDA-0.6x0.2x-5.6x-2.2x-1.6x0.6x

Revenue and profitability


The company's Revenue surged on 23.5% in FY2017. EBITDA Margin showed almost no change in FY2017.

Gross Margin decreased on 2.3 pp from 59.3% to 57.0% in FY2017.

Net Income marign showed almost no change in FY2017.

Capital expenditures (CAPEX) and working capital investments


In FY2017 IMImobile had CAPEX/Revenue of 2.8%. The company showed small CAPEX/Revenue decline of 1.1 pp from 3.9% in FY2014 to 2.8% in FY2017. Average CAPEX/Revenue for the last three years was 2.7%.

Return on investment


The company operates at low ROIC (10.58%) and ROE (10.62%). ROIC increased slightly on 0.83 pp from 9.7% to 10.6% in FY2017. ROE showed almost no change in FY2017.

Leverage (Debt)


Company's Net Debt / EBITDA is -1.6x and Debt / EBITDA is 0.1x. Net Debt / EBITDA surged on 0.6x from -2.2x to -1.6x in FY2017. Debt surged while cash decreased on 2.5% in FY2017.

Valuation


The company's trades at EV/EBITDA 15.0x and P/E 30.5x.

Appendix 1: Peers in Software & Computer Services


Below we provide IMImobile benchmarking against other companies in Software & Computer 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 FY2013 FY2014 FY2015 FY2016 FY2017
Pennant International Group ($PEN)29.1%-4.7%-44.4%74.0%
Sopheon ($SPE)5.3%-16.6%23.0%69.7%
Coms ($COMS)46.8%763.3%110.4%36.1%
Microgen ($MCGN)-7.7%-0.0%7.2%34.5%
Dotdigital Group ($DOTD)27.8%32.9%31.8%26.0%
 
Median (34 companies)6.6%4.4%3.1%10.5%
IMImobile ($IMO)12.7%12.6%26.1%23.5%


Top companies by Gross margin, %

Top 5 FY2013 FY2014 FY2015 FY2016 FY2017
Lombard Risk Management ($LRM)98.8%99.2%98.6%99.3%
Netcall ($NET)89.7%91.0%90.9%91.2%
Wandisco ($WAND)80.3%80.7%93.2%88.1%
Dotdigital Group ($DOTD)92.7%90.5%89.3%87.4%
Idox ($IDOX)90.8%89.4%89.3%86.8%
 
Median (24 companies)62.1%57.8%58.8%57.4%
IMImobile ($IMO)61.1%64.3%61.4%59.3%57.0%


Top companies by EBITDA margin, %

Top 5 FY2013 FY2014 FY2015 FY2016 FY2017
Mail.Ru Group Ltd ($61HE)47.4%50.5%34.6%35.2%
Dotdigital Group ($DOTD)39.4%29.2%32.0%30.4%
Idox ($IDOX)26.1%26.0%28.6%27.3%
Proactis Holdings ($PHD)18.3%22.8%26.4%23.7%
Oxford Metrics ($OMG)6.0%14.7%28.4%23.1%
 
Median (27 companies)12.8%11.1%12.5%11.0%
IMImobile ($IMO)14.6%16.4%5.4%11.1%11.0%


Top companies by CAPEX/Revenue, %

Top 5 FY2013 FY2014 FY2015 FY2016 FY2017
Mail.Ru Group Ltd ($61HE)5.8%3.0%3.6%5.2%
Csf Group ($CSFG)4.0%2.4%7.1%4.9%
International Bus Mach Corp ($IBM)3.7%4.0%4.4%4.5%
Unisys Corp ($USY)2.5%4.1%5.0%3.0%
Gresham Computing ($GHT)4.0%1.9%1.5%3.0%
 
Median (27 companies)1.5%1.9%1.0%1.2%
IMImobile ($IMO)3.3%3.9%2.0%3.3%2.8%


Top companies by ROIC, %

Top 5 FY2013 FY2014 FY2015 FY2016 FY2017
Rm ($RM.)48.6%130.8%289.2%263.8%
Triad Group ($TRD)-3.8%24.5%61.5%74.4%
Dotdigital Group ($DOTD)38.0%28.5%31.4%28.9%
International Bus Mach Corp ($IBM)31.0%28.1%25.7%18.7%
Oxford Metrics ($OMG)-0.1%0.8%14.6%16.3%
 
Median (34 companies)11.6%9.8%7.7%8.5%
IMImobile ($IMO)27.6%27.2%0.5%9.7%10.6%


Top companies by Net Debt / EBITDA

Top 5 FY2013 FY2014 FY2015 FY2016 FY2017
Zoo Digital Group ($ZOO)3.2x38.3x
Progility ($PGY)1.8x12.8x6.8x
International Bus Mach Corp ($IBM)1.2x1.4x1.7x2.2x
Idox ($IDOX)1.3x1.0x1.3x1.2x
Datatec ($DTC)-0.3x0.3x0.4x1.1x
 
Median (24 companies)-0.4x-0.4x-0.5x-0.8x
IMImobile ($IMO)-0.6x0.2x-5.6x-2.2x-1.6x