Solid State revenue jumped on 15.6% while EBITDA Margin decreased slightly on 1.2 pp from 8.9% to 7.7%
03 Jul 2018 • About Solid State (
$SSP) • By InTwits
Solid State reported FY2018 financial results today. Here are the key drivers of the company's long term financial model:
- EBITDA Margin is quite volatile: 7.7% in FY2018, 8.9% in FY2017, 11.2% in FY2016, 9.7% in FY2015, 17.3% in FY2014
- Solid State has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.9%. At the same time it's in pair with industry average of 2.3%
- CAPEX is quite volatile: £0m in FY2018, £1m in FY2017, £1m in FY2016, £1m in FY2015, £0m in FY2014
- The company has highly profitable business model: ROIC is 15.2%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Solid State's Revenue surged on 15.6%. Revenue growth was financed by EBITDA margin decline. EBITDA Margin decreased slightly on 1.2 pp from 8.9% to 7.7% in FY2018.
Gross Margin decreased on 2.5 pp from 30.1% to 27.5% in FY2018. During FY2014-FY2018 Gross Margin topped in FY2016 at 31.8% and was declining since that time. SG&A as a % of Revenue decreased slightly on 1.1 pp from 23.2% to 22.1% in FY2018.
Net Income margin showed almost no change in FY2018.
Investments (CAPEX, working capital and M&A)
In FY2018 the company had CAPEX/Revenue of 0.87%. Solid State showed small CAPEX/Revenue decline of 0.57 pp from 1.4% in FY2015 to 0.87% in FY2018. For the last three years the average CAPEX/Revenue was 2.2%. During FY2014-FY2018 CAPEX as a % of Revenue topped in FY2017 at 3.7%.
Return on investment
The company operates at good ROIC (15.2%) and ROE (12.9%). ROIC increased slightly on 0.54 pp from 14.6% to 15.2% in FY2018. ROE increased slightly on 1.5 pp from 11.4% to 12.9% in FY2018.
Leverage (Debt)
The company has no debt. Cash dropped on 36.7%.
Financial and operational results
FY ended 31 Mar 2018
Solid State ($SSP) key annual financial indicators| mln. £ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 32.085 | 36.559 | 44.100 | 40.021 | 46.268 | 15.6% |
| Gross Profit | 9.357 | 11.164 | 14.028 | 12.027 | 12.743 | 6.0% |
| SG&A | 7.131 | 8.101 | 9.720 | 9.291 | 10.229 | 10.1% |
| EBITDA | 5.551 | 3.561 | 4.940 | 3.570 | 3.580 | 0.3% |
| Net Income | 1.876 | 2.892 | 4.168 | 1.851 | 2.243 | 21.2% |
Balance Sheet
|
|---|
| Cash | 0.685 | 1.738 | 0.994 | 0.909 | 0.575 | -36.7% |
| Short Term Debt | 3.038 | 4.201 | 4.398 | 0.000 | 0.000 | |
| Long Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
Cash flow
|
|---|
| Capex | 0.403 | 0.525 | 0.900 | 1.477 | 0.402 | -72.8% |
Ratios
|
|---|
| Revenue growth | 1.9% | 13.9% | 20.6% | -9.2% | 15.6% | |
| EBITDA growth | 178.9% | -35.8% | 38.7% | -27.7% | 0.3% | |
|
|---|
| Gross Margin | 29.2% | 30.5% | 31.8% | 30.1% | 27.5% | -2.5% |
| EBITDA Margin | 17.3% | 9.7% | 11.2% | 8.9% | 7.7% | -1.2% |
| SG&A, % of revenue | 22.2% | 22.2% | 22.0% | 23.2% | 22.1% | -1.1% |
| Net Income Margin | 5.8% | 7.9% | 9.5% | 4.6% | 4.8% | 0.2% |
| CAPEX, % of revenue | 1.3% | 1.4% | 2.0% | 3.7% | 0.9% | -2.8% |
|
|---|
| ROIC | 44.5% | 20.0% | 23.0% | 14.6% | 15.2% | 0.5% |
| ROE | 22.5% | 25.4% | 29.6% | 11.4% | 12.9% | 1.5% |
| Net Debt/EBITDA | 0.4x | 0.7x | 0.7x | -0.3x | -0.2x | 0.1x |
Peers in Electronic & Electrical Equipment
Below you can find Solid State 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 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Image Scan Hldgs ($IGE) | -13.5% | -22.2% | 94.1% | 51.9% | |
| Flowgroup ($FLOW) | 141.9% | 21.1% | 144.6% | 39.8% | |
| Gooch & Housego ($GHH) | 10.8% | 12.3% | 9.3% | 30.2% | |
| Walsin Lihwa Corp ($WALS) | | -8.4% | -4.0% | 17.0% | |
| Stadium Group ($SDM) | -1.1% | 29.0% | -1.5% | 15.2% | |
| |
|---|
| Median (16 companies) | -2.8% | -1.4% | -1.2% | 8.9% | 0.9% |
|---|
| Solid State ($SSP) | | 13.9% | 20.6% | -9.2% | 15.6% |
Top companies by Gross margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Prophotonix Ltd ($PPIR) | | | 45.4% | 44.6% | |
| Gooch & Housego ($GHH) | 40.5% | 39.4% | 37.5% | 41.1% | |
| Zytronic ($ZYT) | 36.6% | 41.9% | 42.8% | 41.1% | |
| Elektron Technology ($EKT) | 34.8% | 35.6% | 37.2% | 39.1% | 49.7% |
| Image Scan Hldgs ($IGE) | 30.7% | | 42.3% | 38.3% | |
| |
|---|
| Median (14 companies) | 29.6% | 24.1% | 30.5% | 31.5% | 43.1% |
|---|
| Solid State ($SSP) | 29.2% | 30.5% | 31.8% | 30.1% | 27.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Zytronic ($ZYT) | 22.9% | 27.8% | 25.6% | 28.8% | |
| Maruwa Co Ltd ($MAW) | 17.8% | 14.7% | 19.6% | 21.4% | 28.7% |
| Morgan Advanced Materials ($BA29) | 9.8% | 12.8% | 14.6% | 19.2% | |
| Gooch & Housego ($GHH) | 13.4% | 19.8% | 17.3% | 17.3% | |
| Dewhurst ($DWHA) | 13.7% | 14.7% | 13.4% | 13.6% | |
| |
|---|
| Median (15 companies) | 4.5% | 5.8% | 8.3% | 10.4% | 17.8% |
|---|
| Solid State ($SSP) | 17.3% | 9.7% | 11.2% | 8.9% | 7.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Lpa Group ($LPA) | 14.8% | 1.8% | 6.0% | 7.3% | |
| Maruwa Co Ltd ($MAW) | 7.6% | 6.5% | 4.4% | 6.1% | 6.9% |
| Gooch & Housego ($GHH) | 2.7% | 3.9% | 11.3% | 5.2% | |
| Wintek Corp ($WTKA) | 2.4% | 0.6% | 1.6% | 4.2% | |
| Morgan Advanced Materials ($BA29) | 3.7% | 7.0% | 4.0% | 3.4% | |
| |
|---|
| Median (16 companies) | 1.4% | 1.6% | 1.7% | 1.6% | 1.3% |
|---|
| Solid State ($SSP) | 1.3% | 1.4% | 2.0% | 3.7% | 0.9% |
Top companies by ROIC, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Image Scan Hldgs ($IGE) | -45.6% | | 16.4% | 39.8% | |
| Morgan Advanced Materials ($BA29) | 10.9% | 18.4% | 21.9% | 31.6% | |
| Prophotonix Ltd ($PPIR) | | | | 25.8% | |
| Dewhurst ($DWHA) | 24.5% | 27.3% | 24.6% | 24.1% | |
| Zytronic ($ZYT) | 17.0% | 22.7% | 18.1% | 20.9% | |
| |
|---|
| Median (16 companies) | 4.7% | 5.7% | 9.4% | 14.0% | 18.8% |
|---|
| Solid State ($SSP) | 44.5% | 20.0% | 23.0% | 14.6% | 15.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Apc Technology Group ($APC) | 0.5x | | | 5.2x | |
| Walsin Lihwa Corp ($WALS) | 3.9x | 4.6x | 2.7x | 1.9x | |
| Stadium Group ($SDM) | 1.2x | 0.3x | 0.7x | 1.4x | |
| Lpa Group ($LPA) | 1.5x | 3.8x | 1.3x | 1.1x | |
| Morgan Advanced Materials ($BA29) | 2.3x | 1.8x | 1.7x | 0.9x | |
| |
|---|
| Median (13 companies) | 1.2x | -0.2x | 0.4x | -0.5x | -1.0x |
|---|
| Solid State ($SSP) | 0.4x | 0.7x | 0.7x | -0.3x | -0.2x |
