Origin Enterprises reports 22.8% EBITDA growth in 2018 and 0.67 pp EBITDA Margin growth from 4.4% to 5.1%
26 Sep 2018 • About Origin Enterprises (
$OGN) • By InTwits
Origin Enterprises reported FY2018 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Origin Enterprises has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.7%.
- The company has highly profitable business model: ROIC is 13.0%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Origin Enterprises's Revenue increased on 6.5%. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 14.4 pp from 24.9% to 10.6% in FY2018.
Gross Margin decreased slightly on 0.54 pp from 15.1% to 14.6% in FY2018. SG&A as a % of Revenue showed almost no change in FY2018.
Net Income margin increased slightly on 0.50 pp from 3.0% to 3.5% in FY2018.
Investments (CAPEX, working capital and M&A)
In FY2018 the company had CAPEX/Revenue of 0.71%. CAPEX/Revenue showed almost no change from FY2015 to FY2018. For the last three years the average CAPEX/Revenue was 0.63%.
Return on investment
The company operates at good ROIC (13.0%) and ROE (18.4%). ROIC increased slightly on 1.8 pp from 11.1% to 13.0% in FY2018. ROE increased on 2.3 pp from 16.1% to 18.4% in FY2018.
Leverage (Debt)
Debt level is 0.5x Net Debt / EBITDA and 2.3x Debt / EBITDA. Net Debt / EBITDA showed almost no change in FY2018. Debt decreased on 4.1% while cash decreased on 9.5%. During the last 5 years Net Debt/EBITDA bottomed in FY2015 at -0.6x and was growing since that time.
Origin Enterprises has no short term refinancing risk: cash is higher than short term debt (706.5%).
Financial and operational results
FY ended 31 Jul 2018
Origin Enterprises ($OGN) key annual financial indicators| mln. € | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 1,415 | 1,458 | 1,521 | 1,528 | 1,628 | 6.5% |
| Gross Profit | 219 | 226 | 221 | 231 | 238 | 2.7% |
| SG&A | 139 | 147 | 153 | 161 | 166 | 3.1% |
| EBITDA | 84 | 99 | 82 | 67 | 82 | 22.8% |
| Net Income | 63 | 77 | 58 | 46 | 57 | 24.5% |
Balance Sheet
|
|---|
| Cash | 140 | 199 | 168 | 163 | 147 | -9.5% |
| Short Term Debt | 35 | 40 | 9 | 16 | 21 | 28.4% |
| Long Term Debt | 116 | 100 | 159 | 178 | 165 | -7.1% |
Cash flow
|
|---|
| Capex | 12 | 9 | 7 | 11 | 12 | 3.5% |
Ratios
|
|---|
| Revenue growth | -0.2% | 3.0% | 4.3% | 0.5% | 6.5% | |
| EBITDA growth | 6.6% | 18.4% | -17.3% | -18.4% | 22.8% | |
|
|---|
| Gross Margin | 15.5% | 15.5% | 14.5% | 15.1% | 14.6% | -0.5% |
| EBITDA Margin | 5.9% | 6.8% | 5.4% | 4.4% | 5.1% | 0.7% |
| SG&A, % of revenue | 9.9% | 10.1% | 10.1% | 10.6% | 10.2% | -0.3% |
| Net Income Margin | 4.5% | 5.3% | 3.8% | 3.0% | 3.5% | 0.5% |
| CAPEX, % of revenue | 0.9% | 0.6% | 0.4% | 0.7% | 0.7% | -0.0% |
|
|---|
| ROIC | 16.9% | 20.1% | 15.3% | 11.1% | 13.0% | 1.8% |
| ROE | 25.5% | 30.5% | 20.6% | 16.1% | 18.4% | 2.3% |
| Net Debt/EBITDA | 0.1x | -0.6x | -0.0x | 0.5x | 0.5x | 0.0x |
Peers in Food Producers
Below we provide Origin Enterprises benchmarking against other companies in Food Producers 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 |
|---|
| Ukrproduct Group ($UKR) | -38.9% | -36.8% | 0.2% | 51.2% | |
| Narborough Plantations ($NBP) | | 3.5% | 0.5% | 38.2% | |
| R.E.A.Hldgs ($RE.B) | 13.9% | -28.1% | -12.4% | 26.5% | |
| Tate & Lyle ($BD15) | | -15.0% | 0.6% | 16.9% | -1.6% |
| Mhp Sa ($MHPC) | | -14.2% | -4.0% | 13.4% | |
| |
|---|
| Median (19 companies) | -0.7% | -5.1% | 0.5% | 7.3% | -3.4% |
|---|
| Origin Enterprises ($OGN) | | 3.0% | 4.3% | 0.5% | 6.5% |
Top companies by Gross margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Narborough Plantations ($NBP) | 59.7% | 54.6% | 56.1% | 63.0% | |
| Walcom Group Ltd ($WALG) | 62.2% | 60.5% | 58.8% | 54.6% | |
| Kakuzi ($KAKU) | 33.0% | 49.2% | 46.4% | 44.7% | |
| Unilever ($ULVR) | 41.4% | 42.2% | 42.7% | 43.1% | |
| Produce Investments ($PIL) | 33.5% | 36.4% | 37.9% | 35.7% | |
| |
|---|
| Median (17 companies) | 32.7% | 24.9% | 26.8% | 26.0% | 15.9% |
|---|
| Origin Enterprises ($OGN) | 15.5% | 15.5% | 14.5% | 15.1% | 14.6% |
Top companies by EBITDA margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Narborough Plantations ($NBP) | 39.6% | 37.4% | 40.8% | 48.6% | |
| Mhp Sa ($MHPC) | 37.0% | 38.8% | 37.0% | 35.3% | |
| Kakuzi ($KAKU) | 11.8% | 29.4% | 31.8% | 32.7% | |
| R.E.A.Hldgs ($RE.B) | 33.2% | 31.1% | 22.9% | 20.7% | |
| Unilever ($ULVR) | 19.4% | 16.8% | 18.0% | 19.8% | |
| |
|---|
| Median (19 companies) | 11.8% | 13.8% | 11.2% | 13.7% | 16.4% |
|---|
| Origin Enterprises ($OGN) | 5.9% | 6.8% | 5.4% | 4.4% | 5.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| R.E.A.Hldgs ($RE.B) | 11.8% | 17.4% | 39.3% | 32.8% | |
| Ros Agro ($AGRO) | 7.3% | 15.3% | 19.7% | 21.9% | |
| Cherkizovo Group OJSC ($CHE) | 9.7% | 12.2% | 10.4% | 10.9% | |
| Kakuzi ($KAKU) | 22.0% | 24.9% | 13.7% | 10.3% | |
| Real Good Food ($RGD) | 6.3% | 1.4% | 6.4% | 10.0% | |
| |
|---|
| Median (19 companies) | 4.8% | 5.0% | 5.0% | 4.7% | 4.1% |
|---|
| Origin Enterprises ($OGN) | 0.9% | 0.6% | 0.4% | 0.7% | 0.7% |
Top companies by ROIC, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Unilever ($ULVR) | 29.9% | 26.0% | 24.3% | 24.6% | |
| Mhp Sa ($MHPC) | 17.6% | 17.6% | 16.1% | 17.6% | |
| Kakuzi ($KAKU) | 4.3% | 17.4% | 15.8% | 15.6% | |
| Tate & Lyle ($BD15) | 13.2% | 1.8% | 7.2% | 12.1% | 14.4% |
| Kerry Group ($KYGA) | 16.6% | 15.8% | 12.8% | 11.9% | |
| |
|---|
| Median (20 companies) | 11.6% | 8.9% | 7.9% | 7.3% | 8.3% |
|---|
| Origin Enterprises ($OGN) | 16.9% | 20.1% | 15.3% | 11.1% | 13.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Avangardco Investments Public Ltd ($AVGR) | 1.7x | | 241.4x | 29.9x | |
| R.E.A.Hldgs ($RE.B) | 3.9x | 7.2x | 10.6x | 10.8x | |
| Ukrproduct Group ($UKR) | 3.4x | | 17.7x | 6.2x | |
| Zambeef Products ($ZAM) | 4.8x | 3.0x | 2.1x | 4.0x | |
| Ros Agro ($AGRO) | 0.6x | 1.8x | 1.9x | 3.7x | |
| |
|---|
| Median (17 companies) | 1.6x | 1.8x | 1.8x | 2.0x | 1.6x |
|---|
| Origin Enterprises ($OGN) | 0.1x | -0.6x | -0.0x | 0.5x | 0.5x |
