Zoo Digital Group revenue growth accelerated to 73.2% in FY2018 vs. 41.7% a year earliner
02 Jul 2018 • About Zoo Digital Group (
$ZOO) • By InTwits
Zoo Digital Group reported FY2018 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Zoo Digital Group is a fast growth stock: FY2018 revenue growth was 73.2%, 5 year revenue CAGR was 22.5% at FY2018 ROIC 8.6%
- EBITDA Margin is quite volatile: 7.4% in FY2018, 10.7% in FY2017, 1.3% in FY2016, -4.8% in FY2015, -4.0% in FY2014
- Zoo Digital Group has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.3%. At the same time it's in pair with industry average of 16.4%
- CAPEX is quite volatile: $0m in FY2018, $0m in FY2017, $0m in FY2016, $0m in FY2015, $0m in FY2014
- The company has business model with low profitability: ROIC is 8.6%
- It operates with medium-size leverage: Net Debt/EBITDA is 0.9x while industry average is -0.3x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue surged on 73.2%. Revenue decline was slowing down on average by 18.4 pp per annum in FY2014-FY2018. Revenue growth was financed by EBITDA margin decline. EBITDA Margin decreased on 3.3 pp from 10.7% to 7.4% in FY2018. EBITDA Margin followed a growing trend at 3.8 pp per annum in the last 5 years.
Gross Margin dropped on 37.6 pp from 72.8% to 35.3% in FY2018.
Net Income margin dropped on 21.5 pp from 4.8% to -16.7% in FY2018. During FY2014-FY2018 Net Income margin topped in FY2017 at 4.8%.
Investments (CAPEX, working capital and M&A)
Zoo Digital Group's CAPEX/Revenue was 0.93% in FY2018. CAPEX/Revenue showed almost no change from FY2015 to FY2018. It's average level of CAPEX/Revenue for the last three years was 0.74%.
Return on investment
The company operates at low but positive ROIC (8.6%) and negative ROE (-182.4%). ROIC increased on 2.3 pp from 6.3% to 8.6% in FY2018. ROE dropped on 219 pp from 36.6% to -182% in FY2018. ROIC followed a growing trend at 9.1 pp per annum in FY2014-FY2018.
Leverage (Debt)
Debt level is 0.9x Net Debt / EBITDA and 2.0x Debt / EBITDA. Net Debt / EBITDA dropped on 2.3x from 3.2x to 0.9x in FY2018. Debt dropped on 30.8% while cash surged on 297%.
Zoo Digital Group has no short term refinancing risk: cash is higher than short term debt (1,065.9%).
Financial and operational results
FY ended 31 Mar 2018
Zoo Digital Group ($ZOO) key annual financial indicators| mln. $ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 9.562 | 11.465 | 11.638 | 16.488 | 28.551 | 73.2% |
| Gross Profit | 7.854 | 8.982 | 9.239 | 12.005 | 10.065 | -16.2% |
| EBITDA | -0.384 | -0.547 | 0.156 | 1.769 | 2.120 | 19.8% |
| Net Income | -2.692 | -2.058 | -0.787 | 0.791 | -4.756 | -701.3% |
Balance Sheet
|
|---|
| Cash | 0.122 | 0.325 | 0.314 | 0.607 | 2.409 | 296.9% |
| Short Term Debt | 0.147 | 0.105 | 0.142 | 4.102 | 0.226 | -94.5% |
| Long Term Debt | 5.238 | 5.453 | 6.142 | 2.126 | 4.084 | 92.1% |
Cash flow
|
|---|
| Capex | 0.369 | 0.067 | 0.032 | 0.168 | 0.266 | 58.3% |
Ratios
|
|---|
| Revenue growth | -7.7% | 19.9% | 1.5% | 41.7% | 73.2% | |
| EBITDA growth | -160.7% | 42.4% | -128.5% | 1,034.0% | 19.8% | |
|
|---|
| Gross Margin | 82.1% | 78.3% | 79.4% | 72.8% | 35.3% | -37.6% |
| EBITDA Margin | -4.0% | -4.8% | 1.3% | 10.7% | 7.4% | -3.3% |
| Net Income Margin | -28.2% | -18.0% | -6.8% | 4.8% | -16.7% | -21.5% |
| CAPEX, % of revenue | 3.9% | 0.6% | 0.3% | 1.0% | 0.9% | -0.1% |
|
|---|
| ROIC | -21.8% | -23.7% | -15.0% | 6.3% | 8.6% | 2.3% |
| ROE | -45.6% | -58.0% | -36.7% | 36.6% | -182.4% | -218.9% |
| Net Debt/EBITDA | | | 38.3x | 3.2x | 0.9x | -2.3x |
Peers in Software & Computer Services
Below we provide Zoo Digital Group 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 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Pinnacle Technology Group ($PINN) | -17.1% | | | 108.6% | |
| Wandisco ($WAND) | 40.0% | -2.0% | 3.5% | 72.6% | |
| Microgen ($MCGN) | -0.0% | 7.2% | 34.5% | 45.7% | |
| Lombard Risk Management ($LRM) | 21.6% | 5.4% | 10.3% | 44.8% | |
| Statpro Group ($SOG) | -1.4% | -5.7% | 24.4% | 31.4% | |
| |
|---|
| Median (39 companies) | 4.7% | 4.7% | 11.7% | 10.9% | 2.3% |
|---|
| Zoo Digital Group ($ZOO) | | 19.9% | 1.5% | 41.7% | 73.2% |
Top companies by Gross margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Lombard Risk Management ($LRM) | 99.2% | 98.6% | 99.3% | 99.6% | |
| Netcall ($NET) | 91.0% | 90.9% | 91.2% | 91.7% | |
| Wandisco ($WAND) | 80.7% | 93.2% | 88.1% | 90.0% | |
| Eleco ($ELCO) | 87.8% | 88.9% | 86.7% | 87.9% | |
| Dotdigital Group ($DOTD) | 90.5% | 89.3% | 87.4% | 86.1% | |
| |
|---|
| Median (33 companies) | 57.5% | 55.0% | 56.6% | 55.1% | 26.2% |
|---|
| Zoo Digital Group ($ZOO) | 82.1% | 78.3% | 79.4% | 72.8% | 35.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Rightster Group ($RSTR) | -146.3% | -64.1% | -19.9% | 114.2% | |
| Dotdigital Group ($DOTD) | 29.2% | 32.0% | 30.4% | 31.7% | |
| Sopheon ($SPE) | 6.8% | 19.8% | 22.6% | 27.9% | |
| Mail.Ru Group Ltd ($61HE) | 50.5% | 34.6% | 35.2% | 25.1% | |
| Gresham Computing ($GHT) | 8.8% | 18.1% | 20.6% | 22.6% | |
| |
|---|
| Median (39 companies) | 11.1% | 12.4% | 10.3% | 11.0% | 6.6% |
|---|
| Zoo Digital Group ($ZOO) | -4.0% | -4.8% | 1.3% | 10.7% | 7.4% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Actual Experience ($ACT) | 2.6% | 6.0% | 39.9% | 48.7% | |
| Csf Group ($CSFG) | 2.4% | 7.1% | 4.9% | 8.5% | |
| Pennant International Group ($PEN) | 1.4% | 0.2% | 6.3% | 7.1% | |
| Nasstar ($NASA) | 2.1% | 5.2% | 8.9% | 6.5% | |
| Oxford Metrics ($OMG) | 2.8% | 2.4% | 1.8% | 5.8% | |
| |
|---|
| Median (39 companies) | 1.7% | 1.4% | 1.2% | 1.3% | 0.9% |
|---|
| Zoo Digital Group ($ZOO) | 3.9% | 0.6% | 0.3% | 1.0% | 0.9% |
Top companies by ROIC, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Rm ($RM.) | 130.8% | 289.2% | 254.7% | 73.8% | |
| Triad Group ($TRD) | 24.5% | 61.5% | 74.4% | 61.1% | 41.0% |
| Sopheon ($SPE) | -10.5% | 14.7% | 22.7% | 32.3% | |
| Dotdigital Group ($DOTD) | 28.5% | 31.4% | 28.9% | 29.3% | |
| International Bus Mach Corp ($IBM) | 31.6% | 29.7% | 21.5% | 19.5% | 19.8% |
| |
|---|
| Median (41 companies) | 9.8% | 5.3% | 8.2% | 6.4% | 6.4% |
|---|
| Zoo Digital Group ($ZOO) | -21.8% | -23.7% | -15.0% | 6.3% | 8.6% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Datatec ($DTC) | 0.3x | 0.4x | 1.1x | 10.2x | |
| Progility ($PGY) | 1.8x | 12.8x | 6.8x | 3.9x | |
| Statpro Group ($SOG) | -0.3x | -0.2x | | 3.0x | |
| Idox ($IDOX) | 1.0x | 1.3x | 1.2x | 2.2x | |
| International Bus Mach Corp ($IBM) | 1.1x | 1.3x | 1.7x | 1.8x | 1.7x |
| |
|---|
| Median (31 companies) | -0.3x | -0.5x | -0.9x | -0.5x | -0.5x |
|---|
| Zoo Digital Group ($ZOO) | | | 38.3x | 3.2x | 0.9x |
