Walker Crips Group reports 229% CAPEX growth in 2018 and 4.1% Revenue growth
31 Jul 2018 • About Walker Crips Group (
$WCW) • By InTwits
Walker Crips Group reported FY2018 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Walker Crips Group has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.6%. At the same time it's a lot of higher than industry average of 1.7%.
- CAPEX is quite volatile: £2m in FY2018, £0m in FY2017, £0m in FY2016, £1m in FY2015, £1m in FY2014
- The company has potentially unprofitable business model: ROIC is 4.0%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Walker Crips Group's Revenue increased on 4.1%. During the last 5 years Revenue growth topped in FY2016 at 13.4% and was decelerating since that time. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased slightly on 1.1 pp from 5.2% to 6.3% in FY2018.
Gross Margin decreased on 2.7 pp from 69.8% to 67.2% in FY2018. SG&A as a % of Revenue decreased slightly on 1.9 pp from 66.1% to 64.2% in FY2018.
Net Income margin showed almost no change in FY2018.
Investments (CAPEX, working capital and M&A)
Walker Crips Group's CAPEX/Revenue was 5.4% in FY2018. Walker Crips Group showed CAPEX/Revenue growth of 2.9 pp from 2.5% in FY2015 to 5.4% in FY2018. It's average level of CAPEX/Revenue for the last three years was 2.7%. The company maintained rich investment policy and has spent a big chunk of EBITDA (84.1%) to CAPEX. During FY2014-FY2018 CAPEX as a % of Revenue bottomed in FY2016 at 0.95% and was growing since that time.
Return on investment
The company operates at low ROIC (4.0%) and ROE (3.4%). ROIC increased slightly on 0.59 pp from 3.4% to 4.0% in FY2018. ROE increased slightly on 0.69 pp from 2.7% to 3.4% in FY2018.
Leverage (Debt)
The company paid down all the debt in FY2018. Cash increased on 8.3%.
Financial and operational results
FY ended 31 Mar 2018
Walker Crips Group ($WCW) key annual financial indicators| mln. £ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 20.688 | 22.994 | 26.070 | 29.244 | 30.456 | 4.1% |
| Gross Profit | 14.104 | 15.341 | 17.637 | 20.420 | 20.455 | 0.2% |
| SG&A | | 14.810 | 16.996 | 19.330 | 19.556 | 1.2% |
| EBITDA | | 1.489 | 0.786 | 1.759 | 1.953 | 11.0% |
| Net Income | 2.034 | 0.257 | 0.795 | 0.575 | 0.745 | 29.6% |
Balance Sheet
|
|---|
| Cash | 8.173 | 6.635 | 7.257 | 7.729 | 8.367 | 8.3% |
| Short Term Debt | 0.070 | 0.134 | 0.077 | 0.035 | 0.000 | -100.0% |
| Long Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
Cash flow
|
|---|
| Capex | 0.542 | 0.565 | 0.247 | 0.499 | 1.642 | 229.1% |
Ratios
|
|---|
| Revenue growth | 1.6% | 11.1% | 13.4% | 12.2% | 4.1% | |
| EBITDA growth | | | -47.2% | 123.8% | 11.0% | |
|
|---|
| Gross Margin | 68.2% | 66.7% | 67.7% | 69.8% | 67.2% | -2.7% |
| EBITDA Margin | | 6.5% | 3.0% | 6.0% | 6.4% | 0.4% |
| SG&A, % of revenue | | 64.4% | 65.2% | 66.1% | 64.2% | -1.9% |
| Net Income Margin | 9.8% | 1.1% | 3.0% | 2.0% | 2.4% | 0.5% |
| CAPEX, % of revenue | 2.6% | 2.5% | 0.9% | 1.7% | 5.4% | 3.7% |
|
|---|
| ROIC | 2.2% | 4.0% | -0.7% | 3.4% | 4.0% | 0.6% |
| ROE | 9.9% | 1.2% | 3.8% | 2.7% | 3.4% | 0.7% |
| Net Debt/EBITDA | | -4.4x | -9.1x | -4.4x | -4.3x | 0.1x |
Peers in Financial Services
Below we provide Walker Crips Group benchmarking against other companies in Financial 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 |
|---|
| Starvest ($SVE) | | -52.9% | -4.8% | 346.6% | |
| Henderson Group ($HGG) | 13.8% | 13.0% | -1.0% | 90.7% | |
| Arden Partners ($ARDN) | -21.3% | -31.0% | 6.8% | 78.9% | |
| Impax Asset Management Group ($IPX) | 10.3% | -3.1% | 6.8% | 55.2% | |
| Afh Financial Group ($AFHP) | 39.3% | 39.5% | 15.0% | 39.4% | |
| |
|---|
| Median (33 companies) | 7.7% | 2.7% | 5.0% | 12.9% | 17.6% |
|---|
| Walker Crips Group ($WCW) | | 11.1% | 13.4% | 12.2% | 4.1% |
Top companies by Gross margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Record ($REC) | 99.6% | 99.3% | 99.0% | 98.8% | 98.7% |
| London Capital Group Hldgs ($LCG) | 73.6% | 67.9% | 84.2% | 86.4% | |
| Schroders ($SDRC) | 77.7% | 78.3% | 79.9% | 80.0% | |
| First Property Group ($FPO) | 67.9% | 83.0% | 80.6% | 78.6% | 76.3% |
| S & U ($46IE) | 67.6% | 65.3% | 63.3% | 58.6% | 53.8% |
| |
|---|
| Median (13 companies) | 43.8% | 52.3% | 55.4% | 49.4% | 65.0% |
|---|
| Walker Crips Group ($WCW) | 68.2% | 66.7% | 67.7% | 69.8% | 67.2% |
Top companies by EBITDA margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Real Estate Credit Investments Pcc ($RECP) | 77.0% | 80.3% | 79.3% | 79.5% | 81.8% |
| Hargreaves Lansdown ($HL.) | 58.7% | 51.2% | 57.5% | 69.3% | |
| Plus500 Ltd ($PLUS) | 63.5% | 48.2% | 46.0% | 59.3% | |
| First Property Group ($FPO) | 40.2% | 42.9% | 52.2% | 57.4% | 52.9% |
| Livermore Investments Group Ltd ($LIV) | 78.8% | 83.5% | 71.9% | 56.8% | |
| |
|---|
| Median (30 companies) | 14.5% | 18.3% | 18.5% | 22.8% | 37.2% |
|---|
| Walker Crips Group ($WCW) | | 6.5% | 3.0% | 6.0% | 6.4% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Daishin Securities Co ($DSS) | 15.0% | 6.5% | 15.1% | 11.2% | |
| First Property Group ($FPO) | 0.3% | 0.1% | 6.4% | 8.5% | 9.4% |
| Schroders ($SDRC) | 1.5% | 1.9% | 3.0% | 6.9% | |
| Leeds Group ($LDSG) | 0.6% | 0.9% | 11.5% | 5.6% | |
| Record ($REC) | 0.1% | 0.6% | 0.1% | 3.8% | 1.0% |
| |
|---|
| Median (30 companies) | 0.7% | 0.8% | 0.9% | 1.0% | 1.0% |
|---|
| Walker Crips Group ($WCW) | 2.6% | 2.5% | 0.9% | 1.7% | 5.4% |
Top companies by ROIC, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Plus500 Ltd ($PLUS) | 164.3% | 116.5% | 118.9% | 143.2% | |
| Fulcrum Utility Services Ld ($FCRM) | | | 347.2% | 103.4% | 29.9% |
| Hargreaves Lansdown ($HL.) | 101.0% | 87.5% | 90.0% | 93.3% | |
| Guinness Peat Group ($GPG) | 10.0% | 13.7% | 23.8% | 28.8% | |
| Lighthouse Group ($LGT) | 8.6% | 14.6% | 25.7% | 26.6% | |
| |
|---|
| Median (34 companies) | 8.9% | 7.8% | 8.1% | 9.9% | 11.4% |
|---|
| Walker Crips Group ($WCW) | 2.2% | 4.0% | -0.7% | 3.4% | 4.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Daishin Securities Co ($DSS) | 10.7x | 8.0x | 13.4x | 12.7x | |
| First Property Group ($FPO) | 5.6x | 12.3x | 9.4x | 7.6x | 7.7x |
| Leeds Group ($LDSG) | -0.5x | -0.3x | 1.4x | 2.6x | |
| S & U ($46IE) | 1.7x | 3.1x | 0.5x | 1.8x | 3.2x |
| Guinness Peat Group ($GPG) | -2.1x | -1.6x | -0.4x | 1.2x | |
| |
|---|
| Median (26 companies) | -2.1x | -1.1x | -1.0x | -1.3x | -0.9x |
|---|
| Walker Crips Group ($WCW) | | -4.4x | -9.1x | -4.4x | -4.3x |
