Turkiye Garanti Bankasi revenue growth accelerated from 18.6% in 2017 to 50.6% in 2018
31 Jan 2019 • About Turkiye Garanti Bankasi (
$39IS) • By InTwits
Turkiye Garanti Bankasi reported 2018 financial results today. Here are the key drivers of the company's long term financial model:
- Turkiye Garanti Bankasi is a fast growth stock: 2018 revenue growth was 50.6%, 5 year revenue CAGR was 22.4% at 2018 ROIC 6.5%
- Turkiye Garanti Bankasi has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.8%. At the same time it's in pair with industry average of 2.8%
- CAPEX is quite volatile: 1,794 TRYm in 2018, 819 TRYm in 2017, 1,021 TRYm in 2016, 561 TRYm in 2015, 401 TRYm in 2014
- The company has potentially unprofitable business model: ROIC is 6.5%
- It operates with high leverage: Net Debt/EBITDA is 4.6x while industry average is
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 jumped on 50.6%.
Net Income margin decreased on 5.7 pp from 18.9% to 13.1% in 2018.
Investments (CAPEX, working capital and M&A)
The company's CAPEX/Revenue was 3.5% in 2018. CAPEX/Revenue increased slightly on 1.2 pp from 2.4% in 2015 to 3.5% in 2018. Average CAPEX/Revenue for the last three years was 3.2%.
Return on investment
The company operates at good ROE (15.1%) while ROIC is low (6.5%). ROIC showed almost no change in 2018. ROE decreased slightly on 1.4 pp from 16.5% to 15.1% in 2018. ROIC stuck to a growing trend at 0.54 pp per annum in the last 5 years.
Leverage (Debt)
Debt dropped on 18.2% while cash surged on 23.9%.
Turkiye Garanti Bankasi has no short term refinancing risk: cash is higher than short term debt (261.2%).
The company paid 29.1% of Net Income as dividends in 2018.
Management team
The company has 18,337 employees. Average revenue per employee in 2018 was 2,757,794 TRY.
Financial and operational results
FY ended 31 Dec 2018
Turkiye Garanti Bankasi ($39IS) key annual financial indicators| mln. TRY | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 21,330 | 23,527 | 28,321 | 33,578 | 50,570 | 50.6% |
| Net Income | 3,647 | 3,581 | 5,105 | 6,332 | 6,642 | 4.9% |
Balance Sheet
|
|---|
| Cash | 25,193 | 25,287 | 23,951 | 33,604 | 41,621 | 23.9% |
| Short Term Debt | 20,707 | 13,015 | 15,666 | 28,978 | 15,935 | -45.0% |
| Long Term Debt | 38,776 | 49,404 | 56,566 | 60,288 | 57,089 | -5.3% |
Cash flow
|
|---|
| Capex | 401 | 561 | 1,021 | 819 | 1,794 | 119.0% |
| Dividends | | | | | 1,932 | |
Ratios
|
|---|
| Revenue growth | 15.8% | 10.3% | 20.4% | 18.6% | 50.6% | |
|
|---|
| Net Income Margin | 17.1% | 15.2% | 18.0% | 18.9% | 13.1% | -5.7% |
| CAPEX, % of revenue | 1.9% | 2.4% | 3.6% | 2.4% | 3.5% | 1.1% |
|
|---|
| ROIC | 4.9% | 4.3% | 5.5% | 6.5% | 6.5% | 0.0% |
| ROE | 14.8% | 12.5% | 15.4% | 16.5% | 15.1% | -1.4% |
People
|
|---|
| Employees | | | | | 18,337 | |
| Revenue/Employee, th. TRY | | | | | 2,758 | |
Peers in Banks
Below we provide Turkiye Garanti Bankasi benchmarking against other companies in Banks industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| European Islamic Investment Bank ($EIIB) | 42.3% | -4.1% | -63.9% | 232.5% | |
| Halyk Savings Bank Of Kazakhstn JSC ($HSBK) | 16.3% | 19.5% | 16.4% | 59.5% | |
| Zenith Bank ($ZENB) | | 6.8% | 17.9% | 46.7% | |
| Commercial Intl Bank(Egypt)S.A.E ($CBKD) | 18.9% | 26.8% | 27.0% | 46.4% | |
| TCS Group Holding ($TCS) | 11.5% | 10.6% | 34.0% | 33.7% | |
| |
|---|
| Median (43 companies) | 15.7% | 3.5% | 3.4% | 4.5% | 11.3% |
|---|
| Turkiye Garanti Bankasi ($39IS) | | 10.3% | 20.4% | 18.6% | 50.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Lloyds Banking Group ($LLPC) | 13.1% | 13.6% | 14.5% | 14.5% | |
| Banco Santander Sa ($BNC) | 8.9% | 10.2% | 9.1% | 10.0% | 14.7% |
| Bcb Hldgs Ltd ($BCBW) | 5.4% | 2.5% | 3.0% | 7.3% | 5.9% |
| Royal Bank Of Scotland Group ($RBS) | 4.1% | 4.6% | 5.6% | 7.1% | |
| Diamond Bank ($DBPA) | 6.0% | 6.7% | 6.2% | 7.0% | |
| |
|---|
| Median (39 companies) | 2.1% | 2.6% | 2.0% | 1.8% | 1.2% |
|---|
| Turkiye Garanti Bankasi ($39IS) | 1.9% | 2.4% | 3.6% | 2.4% | 3.5% |
Top companies by ROIC, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| TCS Group Holding ($TCS) | 6.7% | 3.4% | 22.5% | 31.8% | |
| Commercial Intl Bank(Egypt)S.A.E ($CBKD) | 30.1% | 30.3% | 28.0% | 25.3% | |
| Guaranty Trust Bank ($GRTB) | 17.8% | 16.0% | 17.4% | 18.3% | |
| Sberbank Of Russia ($SBER) | 4.8% | 4.0% | 9.4% | 13.0% | |
| Zenith Bank ($ZENB) | 15.0% | 11.2% | 11.1% | 11.4% | |
| |
|---|
| Median (43 companies) | 4.4% | 3.4% | 4.5% | 4.4% | 4.5% |
|---|
| Turkiye Garanti Bankasi ($39IS) | 4.9% | 4.3% | 5.5% | 6.5% | 6.5% |
