Oxford Metrics Net Income jumped on 17.9% while EBITDA Margin decreased on 2.2 pp from 23.5% to 21.3%
03 Dec 2019 • About Oxford Metrics (
$OMG) • By InTwits
Oxford Metrics reported FY2019 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Oxford Metrics has low CAPEX intensity: 5 year average CAPEX/Revenue was 3.0%. At the same time it's a lot of higher than industry average of 2.3%.
- CAPEX is quite volatile: £0m in FY2019, £1m in FY2018, £2m in FY2017, £1m in FY2016, £1m in FY2015
- The company has highly profitable business model: ROIC is 14.7%
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 11.7%. Revenue growth was financed by EBITDA margin decline. EBITDA Margin decreased on 2.2 pp from 23.5% to 21.3% in FY2019.
Gross Margin decreased slightly on 1.1 pp from 72.4% to 71.2% in FY2019. Gross Margin followed a growing trend at 2.2 pp per annum in the last 5 years. SG&A as a % of Revenue decreased slightly on 0.58 pp from 47.4% to 46.8% in FY2019. During FY2015-FY2019 SG&A as a % of Revenue topped in FY2017 at 48.0% and was declining since that time. Stock Based Compensation (SBC) as a % of Revenue showed almost no change in FY2019.
Net Income margin increased slightly on 0.63 pp from 11.2% to 11.8% in FY2019. During FY2015-FY2019 Net Income margin bottomed in FY2017 at 3.5% and was growing since that time. The efficient tax rate was 10.8% in FY2019.
Investments (CAPEX, working capital and M&A)
Oxford Metrics's CAPEX/Revenue was 1.3% in FY2019. The company's CAPEX/Revenue showed almost no change from FY2016 to FY2019. For the last three years the average CAPEX/Revenue was 3.7%.
Inventories as a % of Revenue increased slightly on 1.6 pp from 7.6% to 9.2% in FY2019.
Return on investment
The company operates at good ROIC (14.7%) and ROE (13.7%). ROIC decreased slightly on 1.7 pp from 16.4% to 14.7% in FY2019. ROE increased slightly on 1.3 pp from 12.4% to 13.7% in FY2019. During FY2015-FY2019 ROE bottomed in FY2017 at 3.7% and was growing since that time.
Leverage (Debt)
The company has no debt. Cash surged on 13.1%.
Valuation and dividends
Oxford Metrics's trades at EV/EBITDA 13.9x and P/E 28.4x.
The company paid 71.8% of Net Income as dividends in FY2019.
Management team
9.3% of the company is owned by insiders. Insider ownership didn't change in 2019.
The company has 210 employees. The number of employees dropped on 10.3%. Average revenue per employee in FY2019 was £168,333 and it surged on 24.4%.
Financial and operational results
FY ended 30 Sep 2019
Oxford Metrics ($OMG) key annual financial indicators| mln. £ | 2015 | 2016 | 2017 | 2018 | 2019 | 2019/2018 |
|---|
P&L
|
|---|
| Revenue | 25.733 | 29.492 | 29.155 | 31.656 | 35.350 | 11.7% |
| Gross Profit | 16.288 | 19.427 | 20.556 | 22.913 | 25.184 | 9.9% |
| SG&A | 9.316 | 11.163 | 13.984 | 14.993 | 16.538 | 10.3% |
| EBITDA | 7.319 | 6.808 | 5.796 | 7.449 | 7.523 | 1.0% |
| EBIT | | | | 4.970 | 4.762 | -4.2% |
| Tax | | | | 0.556 | 0.504 | -9.4% |
| Net Income | 8.042 | 2.271 | 1.007 | 3.543 | 4.178 | 17.9% |
| Stock Based Compensation | | | | 0.323 | 0.264 | -18.3% |
Balance Sheet
|
|---|
| Cash | 11.738 | 8.273 | 9.185 | 12.229 | 13.837 | 13.1% |
| Inventory | | | | 2.403 | 3.236 | 34.7% |
| Short Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
| Long Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
Cash flow
|
|---|
| Capex | 0.626 | 0.526 | 1.680 | 1.243 | 0.467 | -62.4% |
| Dividends | | | | 1.000 | 3.000 | 200.0% |
| Acquisitions | | | | -1.295 | | |
Ratios
|
|---|
| Revenue growth | 0.4% | 14.6% | -1.1% | 8.6% | 11.7% | |
| EBITDA growth | 93.9% | -7.0% | -14.9% | 28.5% | 1.0% | |
|
|---|
| Gross Margin | 63.3% | 65.9% | 70.5% | 72.4% | 71.2% | -1.1% |
| EBITDA Margin | 28.4% | 23.1% | 19.9% | 23.5% | 21.3% | -2.2% |
| EBIT Margin | | | | 15.7% | 13.5% | -2.2% |
| SG&A, % of revenue | 36.2% | 37.9% | 48.0% | 47.4% | 46.8% | -0.6% |
| SBC, % of revenue | | | | 1.0% | 0.7% | -0.3% |
| Net Income Margin | 31.3% | 7.7% | 3.5% | 11.2% | 11.8% | 0.6% |
| CAPEX, % of revenue | 2.4% | 1.8% | 5.8% | 3.9% | 1.3% | -2.6% |
|
|---|
| ROIC | 14.6% | 16.3% | 12.7% | 16.4% | 14.7% | -1.7% |
| ROE | 26.9% | 8.1% | 3.7% | 12.4% | 13.7% | 1.3% |
| Net Debt/EBITDA | -1.6x | -1.2x | -1.6x | -1.6x | -1.8x | -0.2x |
People
|
|---|
| Insider ownership | | | | 9.3% | 9.3% | 0.0% |
| Employees | | | | 234 | 210 | -10.3% |
| Revenue/Employee, th. £ | | | | 135 | 168 | 24.4% |
Peers in Software & Computer Services
Below you can find Oxford Metrics benchmarking vs. other companies in Software & Computer Services 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 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Actual Experience ($ACT) | 23.4% | 2.3% | -49.1% | 195.1% | |
| Micro Focus International ($MCRO) | 92.7% | 49.2% | 29.3% | 128.8% | |
| Proactis Holdings ($PHD) | 69.6% | 12.5% | 31.1% | 105.6% | |
| Zoo Digital Group ($ZOO) | 19.9% | 1.5% | 41.7% | 73.2% | |
| Sanderson Group ($SND) | 16.9% | 11.1% | 1.1% | 48.7% | |
| |
|---|
| Median (16 companies) | 7.2% | 11.1% | 14.1% | 26.9% | |
|---|
| Oxford Metrics ($OMG) | | 14.6% | -1.1% | 8.6% | 11.7% |
Top companies by Gross margin, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Netcall ($NET) | 90.9% | 91.2% | 91.7% | 90.2% | |
| Proactis Holdings ($PHD) | 80.4% | 82.4% | 86.0% | 88.6% | |
| Sanderson Group ($SND) | 84.5% | 84.1% | 82.2% | 79.6% | |
| Dotdigital Group ($DOTD) | 89.3% | 87.4% | 86.1% | 78.9% | |
| Micro Focus International ($MCRO) | 89.0% | 89.1% | 77.2% | 73.0% | |
| |
|---|
| Median (16 companies) | 57.4% | 59.3% | 56.1% | 43.4% | |
|---|
| Oxford Metrics ($OMG) | 63.3% | 65.9% | 70.5% | 72.4% | 71.2% |
Top companies by EBITDA margin, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Micro Focus International ($MCRO) | 31.6% | 40.9% | 38.9% | 27.5% | |
| Dotdigital Group ($DOTD) | 32.0% | 30.4% | 31.7% | 26.9% | |
| Proactis Holdings ($PHD) | 26.4% | 23.7% | 3.7% | 25.4% | |
| International Bus Mach Corp ($IBM) | 23.1% | 19.8% | 20.5% | 20.9% | |
| Sanderson Group ($SND) | 20.2% | 19.9% | 19.3% | 17.4% | |
| |
|---|
| Median (16 companies) | 12.3% | 10.3% | 10.9% | 9.7% | |
|---|
| Oxford Metrics ($OMG) | 28.4% | 23.1% | 19.9% | 23.5% | 21.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Csf Group ($CSFG) | 7.1% | 4.9% | 8.5% | 16.5% | |
| International Bus Mach Corp ($IBM) | 4.4% | 4.5% | 4.1% | 4.3% | |
| Unisys Corp ($USY) | 5.0% | 3.0% | 4.1% | 3.8% | |
| Actual Experience ($ACT) | 6.0% | 39.9% | 48.7% | 3.6% | |
| Proactis Holdings ($PHD) | 1.3% | 0.9% | 0.3% | 2.1% | |
| |
|---|
| Median (16 companies) | 1.0% | 1.1% | 1.2% | 0.9% | |
|---|
| Oxford Metrics ($OMG) | 2.4% | 1.8% | 5.8% | 3.9% | 1.3% |
Top companies by ROIC, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Triad Group ($TRD) | 61.5% | 74.4% | 61.1% | 41.0% | |
| Rm ($RM.) | 289.2% | 254.7% | 73.8% | 39.0% | |
| Dotdigital Group ($DOTD) | 31.4% | 28.9% | 29.3% | 26.6% | |
| International Bus Mach Corp ($IBM) | 29.7% | 21.5% | 19.5% | 19.8% | |
| Sanderson Group ($SND) | 10.6% | 12.0% | 11.2% | 10.7% | |
| |
|---|
| Median (18 companies) | 4.3% | 7.1% | 5.6% | 5.6% | |
|---|
| Oxford Metrics ($OMG) | 14.6% | 16.3% | 12.7% | 16.4% | 14.7% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Micro Focus International ($MCRO) | 5.3x | 2.1x | 6.6x | 4.2x | |
| Proactis Holdings ($PHD) | -0.3x | 0.1x | 1.0x | 2.5x | |
| International Bus Mach Corp ($IBM) | 1.3x | 1.7x | 1.8x | 1.7x | |
| Zoo Digital Group ($ZOO) | | 38.3x | 3.2x | 0.9x | |
| Netcall ($NET) | -3.4x | -4.3x | -4.3x | 0.3x | |
| |
|---|
| Median (13 companies) | -0.4x | -0.8x | -0.4x | 0.1x | |
|---|
| Oxford Metrics ($OMG) | -1.6x | -1.2x | -1.6x | -1.6x | -1.8x |
