Falkland Islands Hldgs Net Income jumped on 76.4% and Revenue increased on 8.2%
12 Jun 2018 • About Falkland Islands Hldgs (
$FKL) • By InTwits
Falkland Islands Hldgs reported FY2018 financial results today. Here are the key drivers of the company's long term financial model:
- Falkland Islands Hldgs has medium CAPEX intensity: 5 year average CAPEX/Revenue was 7.1%. At the same time it's a lot of higher than industry average of 2.5%.
- CAPEX is quite volatile: £1m in FY2018, £2m in FY2017, £2m in FY2016, £5m in FY2015, £5m in FY2014
- The company has potentially unprofitable business model: ROIC is 6.7%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Falkland Islands Hldgs's Revenue increased on 8.2%. During the last 5 years Revenue growth bottomed in FY2015 at 0.78% and was accelerating since that time. Despite revenue decline the EBITDA margin expanded. EBITDA Margin surged on 12.0 pp from 5.8% to 17.8% in FY2018.
Gross Margin increased slightly on 0.54 pp from 38.6% to 39.1% in FY2018. Gross Margin followed a declining trend at -0.75 pp per annum in the last 5 years. SG&A as a % of Revenue decreased slightly on 0.70 pp from 32.3% to 31.6% in FY2018.
Net Income margin increased on 2.2 pp from 3.5% to 5.7% in FY2018.
Investments (CAPEX, working capital and M&A)
In FY2018 the company had CAPEX/Revenue of 1.7%. The company's CAPEX/Revenue dropped on 10.2 pp from 11.9% in FY2015 to 1.7% in FY2018. It's average CAPEX/Revenue for the last three years was 3.6%. CAPEX as a % of Revenue stuck to a declining trend at -3.0 pp per annum in FY2014-FY2018.
Return on investment
The company operates at low ROIC (6.7%) and ROE (6.2%). ROIC increased on 2.6 pp from 4.0% to 6.7% in FY2018. ROE increased on 2.5 pp from 3.6% to 6.2% in FY2018.
Leverage (Debt)
Company's Net Debt / EBITDA is -1.7x and Debt / EBITDA is 1.6x. Debt decreased on 6.5% while cash surged on 12.9%.
Falkland Islands Hldgs has no short term refinancing risk: cash is higher than short term debt (2,697.0%).
Financial and operational results
FY ended 31 Mar 2018
Falkland Islands Hldgs ($FKL) key annual financial indicators| mln. £ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 38.263 | 38.560 | 38.996 | 40.494 | 43.830 | 8.2% |
| Gross Profit | 16.051 | 15.633 | 15.499 | 15.633 | 17.159 | 9.8% |
| SG&A | | 12.050 | 12.398 | 13.064 | 13.832 | 5.9% |
| EBITDA | 5.367 | 6.371 | 4.747 | 3.566 | 5.080 | 42.5% |
| Net Income | 2.633 | 3.144 | 2.222 | 1.427 | 2.517 | 76.4% |
Balance Sheet
|
|---|
| Cash | 5.715 | 7.435 | 14.037 | 15.079 | 17.018 | 12.9% |
| Short Term Debt | 1.109 | 0.293 | 0.546 | 0.615 | 0.631 | 2.6% |
| Long Term Debt | 5.061 | 5.580 | 7.855 | 8.224 | 7.635 | -7.2% |
Cash flow
|
|---|
| Capex | 4.933 | 4.597 | 1.854 | 1.790 | 0.745 | -58.4% |
Ratios
|
|---|
| Revenue growth | 7.5% | 0.8% | 1.1% | 3.8% | 8.2% | |
| EBITDA growth | 14.0% | 18.7% | -25.5% | -24.9% | 42.5% | |
|
|---|
| Gross Margin | 41.9% | 40.5% | 39.7% | 38.6% | 39.1% | 0.5% |
| EBITDA Margin | 14.0% | 16.5% | 12.2% | 8.8% | 11.6% | 2.8% |
| SG&A, % of revenue | | 31.3% | 31.8% | 32.3% | 31.6% | -0.7% |
| Net Income Margin | 6.9% | 8.2% | 5.7% | 3.5% | 5.7% | 2.2% |
| CAPEX, % of revenue | 12.9% | 11.9% | 4.8% | 4.4% | 1.7% | -2.7% |
|
|---|
| ROIC | 9.3% | 11.1% | 6.8% | 4.0% | 6.7% | 2.6% |
| ROE | 7.6% | 8.7% | 5.9% | 3.6% | 6.2% | 2.5% |
| Net Debt/EBITDA | 0.1x | -0.2x | -1.2x | -1.7x | -1.7x | 0.0x |
Peers in Support Services
Below you can find Falkland Islands Hldgs benchmarking vs. other companies in Support Services 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 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Mortice Ltd ($MORT) | 11.0% | 18.9% | 51.1% | 36.1% | |
| Rws Hldgs ($RWS) | 20.9% | 1.8% | 28.1% | 34.5% | |
| Empresaria Group ($EMR) | -3.3% | -0.3% | 44.4% | 32.1% | |
| Norish ($NSH) | 3.7% | 16.4% | 16.7% | 31.4% | |
| Capital Drilling Ltd ($CAPD) | -15.0% | -20.4% | 18.7% | 28.0% | |
| |
|---|
| Median (47 companies) | 5.1% | 7.2% | 3.5% | 7.0% | 9.2% |
|---|
| Falkland Islands Hldgs ($FKL) | | 0.8% | 1.1% | 3.8% | 8.2% |
Top companies by Gross margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Inspired Energy ($INSE) | 78.7% | 76.2% | 80.5% | 83.1% | |
| Ienergizer Ltd ($IBPO) | 76.8% | 72.7% | 71.3% | 71.2% | |
| Spectra Systems Corp ($SPSY) | 51.4% | 47.6% | 68.3% | 71.1% | |
| Vianet Group ($VNET) | 58.8% | 69.2% | 70.1% | 69.7% | 69.9% |
| Grafenia ($GRA) | 56.1% | 70.8% | 66.3% | 63.0% | 57.0% |
| |
|---|
| Median (41 companies) | 29.2% | 28.1% | 27.0% | 27.9% | 22.1% |
|---|
| Falkland Islands Hldgs ($FKL) | 41.9% | 40.5% | 39.7% | 38.6% | 39.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Northgate ($67GX) | 40.6% | 39.4% | 38.3% | 35.9% | 35.4% |
| Spectra Systems Corp ($SPSY) | 12.3% | 6.0% | 19.7% | 34.0% | |
| Inspired Energy ($INSE) | 1.5% | 35.4% | 34.4% | 32.4% | |
| Vp ($VP.) | 24.2% | 26.2% | 28.4% | 28.6% | 27.2% |
| Rws Hldgs ($RWS) | 22.8% | 23.1% | 26.4% | 25.5% | |
| |
|---|
| Median (47 companies) | 6.7% | 6.9% | 4.9% | 5.7% | 8.2% |
|---|
| Falkland Islands Hldgs ($FKL) | 14.0% | 16.5% | 12.2% | 8.8% | 11.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Vp ($VP.) | 21.6% | 25.7% | 24.1% | 26.0% | 23.6% |
| Augean ($AUG) | 12.3% | 12.3% | 11.0% | 10.0% | |
| Petards Group ($PEG) | 0.5% | 0.9% | 1.7% | 10.0% | |
| Capital Drilling Ltd ($CAPD) | 13.9% | 10.1% | 13.7% | 9.0% | |
| Billing Services Group ($BILL) | 2.1% | 4.1% | 3.0% | 4.5% | |
| |
|---|
| Median (47 companies) | 1.0% | 0.9% | 1.0% | 0.9% | 3.2% |
|---|
| Falkland Islands Hldgs ($FKL) | 12.9% | 11.9% | 4.8% | 4.4% | 1.7% |
Top companies by ROIC, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Sthree ($STHR) | 38.1% | 50.2% | 46.2% | 43.4% | |
| Mortice Ltd ($MORT) | 19.6% | 21.9% | 14.5% | 23.2% | |
| Petards Group ($PEG) | 24.7% | 23.9% | 22.7% | 20.3% | |
| Rws Hldgs ($RWS) | 24.5% | 23.3% | 23.5% | 20.2% | |
| Latham(James) ($LTHM) | 17.5% | 16.8% | 19.2% | 19.3% | 17.4% |
| |
|---|
| Median (48 companies) | 11.1% | 10.4% | 7.9% | 8.1% | 5.4% |
|---|
| Falkland Islands Hldgs ($FKL) | 9.3% | 11.1% | 6.8% | 4.0% | 6.7% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Nakama Group ($NAK) | 5.2x | 1.4x | 3.1x | 48.5x | |
| 21St Century Technology ($C21) | -0.8x | -0.2x | | 11.2x | |
| Ceps ($CEPS) | 6.6x | 3.8x | 13.9x | 5.8x | |
| Ibex Global Solutions ($IBEX) | 2.7x | 1.0x | 1.7x | 4.5x | |
| Menzies(John) ($68HN) | 2.0x | 2.4x | 1.2x | 3.0x | |
| |
|---|
| Median (42 companies) | 0.3x | 0.2x | 0.3x | 0.5x | 2.0x |
|---|
| Falkland Islands Hldgs ($FKL) | 0.1x | -0.2x | -1.2x | -1.7x | -1.7x |
