Carr'S Milling Industries EBITDA surged on 50.3% and EBITDA Margin increased slightly on 1.0 pp from 3.5% to 4.5%
12 Nov 2018 • About Carr'S Milling Industries (
$CRM) • By InTwits
Carr'S Milling Industries reported FY2018 financial results today. Here are the key drivers of the company's long term financial model:
- EBITDA Margin is relatively stable: 4.5% in FY2018 vs. 3.5% in FY2017 vs. 4.8% in FY2014
- Carr'S Milling Industries has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.4%. At the same time it's in pair with industry average of 3.7%
- CAPEX is quite volatile: £7m in FY2018, £5m in FY2017, £3m in FY2016, £3m in FY2015, £5m in FY2014
- The company has business model with low profitability: ROIC is 8.4%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Carr'S Milling Industries's Revenue surged on 16.5%. During FY2014-FY2018 Revenue growth bottomed in FY2015 at -22.8% and was accelerating since that time. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin jumped on 23.8 pp from -6.7% to 17.0% in FY2018.
Gross Margin increased on 2.1 pp from 11.2% to 13.2% in FY2018. SG&A as a % of Revenue increased slightly on 1.1 pp from 8.9% to 10.0% in FY2018.
Net Income margin increased slightly on 0.93 pp from 2.0% to 2.9% in FY2018.
Investments (CAPEX, working capital and M&A)
The company's CAPEX/Revenue was 1.1% in FY2018. CAPEX/Revenue showed almost no change from FY2015 to FY2018. Average CAPEX/Revenue for the last three years was 1.3%.
Return on investment
The company operates at good ROE (12.1%) while ROIC is low (8.4%). ROIC increased on 3.3 pp from 5.1% to 8.4% in FY2018. ROE increased on 4.6 pp from 7.4% to 12.1% in FY2018. During FY2014-FY2018 ROIC bottomed in FY2017 at 5.1%. During FY2014-FY2018 ROE bottomed in FY2017 at 7.4%.
Leverage (Debt)
Debt level is 0.9x Net Debt / EBITDA and 2.2x Debt / EBITDA. Net Debt / EBITDA dropped on 0.3x from 1.2x to 0.9x in FY2018. Debt increased on 5.2% while cash increased on 3.1%.
Carr'S Milling Industries has short term refinancing risk: cash is only 70.4% of short term debt.
Financial and operational results
FY ended 30 Nov -0001
Carr'S Milling Industries ($CRM) key annual financial indicators| mln. £ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 429.0 | 331.3 | 314.9 | 346.2 | 403.2 | 16.5% |
| Gross Profit | 50.3 | 42.7 | 41.2 | 38.7 | 53.3 | 37.9% |
| SG&A | 29.8 | 30.6 | 28.4 | 30.8 | 40.1 | 30.3% |
| EBITDA | 20.5 | 15.5 | 16.2 | 11.9 | 18.0 | 50.3% |
| Net Income | 11.4 | 12.0 | 12.5 | 7.0 | 11.9 | 69.8% |
Balance Sheet
|
|---|
| Cash | 17.3 | 20.1 | 48.4 | 23.9 | 24.6 | 3.1% |
| Short Term Debt | 19.7 | 18.7 | 21.6 | 17.1 | 35.0 | 105.1% |
| Long Term Debt | 22.2 | 25.7 | 18.6 | 21.0 | 5.0 | -76.2% |
Cash flow
|
|---|
| Capex | 7.2 | 4.6 | 5.8 | 2.9 | 4.5 | 57.3% |
Ratios
|
|---|
| Revenue growth | -8.4% | -22.8% | -4.9% | 9.9% | 16.5% | |
| EBITDA growth | 9.1% | -24.4% | 4.3% | -26.1% | 50.3% | |
|
|---|
| Gross Margin | 11.7% | 12.9% | 13.1% | 11.2% | 13.2% | 2.1% |
| EBITDA Margin | 4.8% | 4.7% | 5.1% | 3.5% | 4.5% | 1.0% |
| SG&A, % of revenue | 6.9% | 9.2% | 9.0% | 8.9% | 10.0% | 1.1% |
| Net Income Margin | 2.7% | 3.6% | 4.0% | 2.0% | 2.9% | 0.9% |
| CAPEX, % of revenue | 1.7% | 1.4% | 1.8% | 0.8% | 1.1% | 0.3% |
|
|---|
| ROIC | 11.6% | 8.5% | 8.2% | 5.1% | 8.4% | 3.3% |
| ROE | 15.3% | 14.4% | 13.6% | 7.4% | 12.1% | 4.6% |
| Net Debt/EBITDA | 1.2x | 1.6x | -0.5x | 1.2x | 0.9x | -0.3x |
Peers in Food Producers
Below we provide Carr'S Milling Industries 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 ($MHPC) | | -14.2% | -4.0% | 13.4% | |
| |
|---|
| Median (19 companies) | 2.0% | 1.3% | 0.6% | 7.0% | -1.6% |
|---|
| Carr'S Milling Industries ($CRM) | | -22.8% | -4.9% | 9.9% | 16.5% |
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 ($PIL) | 33.5% | 36.4% | 37.9% | 35.7% | 37.8% |
| |
|---|
| Median (17 companies) | 32.7% | 24.9% | 26.8% | 26.0% | 19.2% |
|---|
| Carr'S Milling Industries ($CRM) | 11.7% | 12.9% | 13.1% | 11.2% | 13.2% |
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 ($ULVR) | 19.4% | 16.8% | 18.0% | 19.8% | |
| |
|---|
| Median (19 companies) | 11.8% | 13.8% | 11.2% | 13.7% | 1.8% |
|---|
| Carr'S Milling Industries ($CRM) | 4.8% | 4.7% | 5.1% | 3.5% | 4.5% |
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 ($RGD) | 6.3% | 1.4% | 6.4% | 10.0% | 8.4% |
| |
|---|
| Median (19 companies) | 4.8% | 5.0% | 5.0% | 4.7% | 3.5% |
|---|
| Carr'S Milling Industries ($CRM) | 1.7% | 1.4% | 1.8% | 0.8% | 1.1% |
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 ($KYGA) | 16.6% | 15.8% | 12.8% | 11.9% | |
| |
|---|
| Median (20 companies) | 12.4% | 9.7% | 7.9% | 9.1% | -0.9% |
|---|
| Carr'S Milling Industries ($CRM) | 11.6% | 8.5% | 8.2% | 5.1% | 8.4% |
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 ($AGRO) | 0.6x | 1.8x | 1.9x | 3.7x | |
| |
|---|
| Median (17 companies) | 1.6x | 1.8x | 1.8x | 2.0x | 0.9x |
|---|
| Carr'S Milling Industries ($CRM) | 1.2x | 1.6x | -0.5x | 1.2x | 0.9x |
