Zytronic Net Income dropped on 26.2% and Revenue decreased on 9.8%
10 Dec 2019 • About Zytronic (
$ZYT) • By InTwits
Zytronic reported FY2019 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Zytronic has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.5%. At the same time it's in pair with industry average of 2.5%
- CAPEX is quite volatile: £1m in FY2019, £0m in FY2018, £0m in FY2017, £0m in FY2016, £1m in FY2015
- The company has business model with average profitability: ROIC is 11.1%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Zytronic's Revenue decreased on 9.8%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased slightly on 1.9 pp from 8.2% to 10.1% in FY2019.
Gross Margin decreased on 3.2 pp from 37.0% to 33.8% in FY2019. Gross Margin followed a declining trend at -2.2 pp per annum in the last 5 years. SG&A as a % of Revenue increased slightly on 0.57 pp from 18.4% to 19.0% in FY2019.
Net Income margin decreased on 3.0 pp from 16.4% to 13.4% in FY2019. During FY2015-FY2019 Net Income margin topped in FY2017 at 20.0% and was declining since that time. The efficient tax rate was 12.0% in FY2019.
Investments (CAPEX, working capital and M&A)
The company's CAPEX/Revenue was 2.5% in FY2019. The company showed small growth in CAPEX/Revenue of 0.68 pp from 1.8% in FY2016 to 2.5% in FY2019. Average CAPEX/Revenue for the last three years was 1.9%.
Inventories as a % of Revenue increased slightly on 1.5 pp from 13.6% to 15.1% in FY2019.
Return on investment
The company operates at low ROIC (11.1%) and ROE (10.2%). ROIC decreased on 4.1 pp from 15.1% to 11.1% in FY2019. ROE decreased on 3.4 pp from 13.6% to 10.2% in FY2019. ROIC declined at -2.6 pp per annum in FY2015-FY2019. ROE followed a declining trend at -2.3 pp per annum in FY2015-FY2019.
Leverage (Debt)
The company has no debt. Cash dropped on 10.1%.
Valuation and dividends
The company's trades at EV/EBITDA 5.1x and P/E 12.8x.
The company paid 148.6% of Net Income as dividends in FY2019.
Management team
1.7% of the company is owned by insiders. Insider ownership didn't change in 2019.
The company has 186 employees. The number of employees decreased on 4.6%. Average revenue per employee in FY2019 was £108,086 and it decreased on 5.4%.
Financial and operational results
FY ended 30 Sep 2019
Zytronic ($ZYT) key annual financial indicators| mln. £ | 2015 | 2016 | 2017 | 2018 | 2019 | 2019/2018 |
|---|
P&L
|
|---|
| Revenue | 21.267 | 21.087 | 22.892 | 22.288 | 20.104 | -9.8% |
| Gross Profit | 8.901 | 9.016 | 9.411 | 8.241 | 6.793 | -17.6% |
| SG&A | 4.351 | 4.365 | 3.984 | 4.100 | 3.812 | -7.0% |
| EBITDA | 5.913 | 5.394 | 6.600 | 5.288 | 4.137 | -21.8% |
| EBIT | | | | 4.141 | 2.981 | -28.0% |
| Interest expence | | | | 0.021 | | |
| Tax | | | | 0.541 | 0.366 | -32.3% |
| Net Income | 3.769 | 4.087 | 4.588 | 3.647 | 2.691 | -26.2% |
Balance Sheet
|
|---|
| Cash | 9.833 | 12.763 | 14.099 | 14.626 | 13.143 | -10.1% |
| Accounts Receivable | | | | 3.738 | | |
| Inventory | | | | 3.021 | 3.034 | 0.4% |
| Short Term Debt | 0.200 | 1.148 | 0.000 | 0.000 | 0.000 | |
| Long Term Debt | 1.144 | 0.000 | 0.000 | 0.000 | 0.000 | |
Cash flow
|
|---|
| Capex | 0.994 | 0.387 | 0.472 | 0.273 | 0.506 | 85.3% |
| Dividends | | | | 4.000 | 4.000 | 0.0% |
Ratios
|
|---|
| Revenue growth | 12.6% | -0.8% | 8.6% | -2.6% | -9.8% | |
| EBITDA growth | 37.0% | -8.8% | 22.4% | -19.9% | -21.8% | |
|
|---|
| Gross Margin | 41.9% | 42.8% | 41.1% | 37.0% | 33.8% | -3.2% |
| EBITDA Margin | 27.8% | 25.6% | 28.8% | 23.7% | 20.6% | -3.1% |
| EBIT Margin | | | | 18.6% | 14.8% | -3.8% |
| SG&A, % of revenue | 20.5% | 20.7% | 17.4% | 18.4% | 19.0% | 0.6% |
| Net Income Margin | 17.7% | 19.4% | 20.0% | 16.4% | 13.4% | -3.0% |
| CAPEX, % of revenue | 4.7% | 1.8% | 2.1% | 1.2% | 2.5% | 1.3% |
|
|---|
| ROIC | 22.7% | 18.1% | 20.9% | 15.1% | 11.1% | -4.1% |
| ROE | 19.5% | 18.6% | 18.3% | 13.6% | 10.2% | -3.4% |
| Net Debt/EBITDA | -1.4x | -2.2x | -2.1x | -2.8x | -3.2x | -0.4x |
People
|
|---|
| Insider ownership | | | | 1.7% | 1.7% | 0.0% |
| Employees | | | | 195 | 186 | -4.6% |
| Revenue/Employee, th. £ | | | | 114 | 108 | -5.4% |
Peers in Electronic & Electrical Equipment
Below you can find Zytronic benchmarking vs. other companies in Electronic & Electrical Equipment 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 |
|---|
| Lpa Group ($LPA) | -3.4% | 31.7% | 4.9% | 24.5% | |
| Maruwa Co Ltd ($MAW) | -2.0% | -6.8% | 5.3% | 19.7% | |
| Solid State ($SSP) | 13.9% | 20.6% | -9.2% | 15.6% | |
| Gooch & Housego ($GHH) | | 9.3% | 30.2% | 11.5% | 3.4% |
| Dewhurst ($DWHA) | | 2.6% | 12.2% | 3.1% | 3.6% |
| |
|---|
| Median (9 companies) | -1.5% | 0.6% | 7.2% | 3.1% | 3.4% |
|---|
| Zytronic ($ZYT) | | -0.8% | 8.6% | -2.6% | -9.8% |
Top companies by Gross margin, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Elektron Technology ($EKT) | 35.6% | 37.2% | 39.1% | 49.7% | |
| Image Scan Hldgs ($IGE) | | 42.3% | 38.3% | 47.5% | 54.1% |
| Maruwa Co Ltd ($MAW) | 30.0% | 35.9% | 36.9% | 43.1% | |
| Gooch & Housego ($GHH) | 39.4% | 37.5% | 41.1% | 40.1% | 34.8% |
| Solid State ($SSP) | 30.5% | 31.8% | 30.1% | 27.5% | |
| |
|---|
| Median (7 companies) | 24.1% | 30.5% | 29.1% | 40.1% | 44.4% |
|---|
| Zytronic ($ZYT) | 41.9% | 42.8% | 41.1% | 37.0% | 33.8% |
Top companies by EBITDA margin, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Maruwa Co Ltd ($MAW) | 14.7% | 19.6% | 21.4% | 28.7% | |
| Elektron Technology ($EKT) | 7.2% | 8.1% | 5.8% | 17.8% | |
| Dewhurst ($DWHA) | 14.7% | 13.4% | 13.6% | 14.2% | 14.6% |
| Gooch & Housego ($GHH) | 19.8% | 17.3% | 17.3% | 14.1% | 13.4% |
| Lpa Group ($LPA) | 4.4% | 9.3% | 11.6% | 9.9% | |
| |
|---|
| Median (8 companies) | 5.8% | 8.3% | 8.9% | 12.0% | 13.4% |
|---|
| Zytronic ($ZYT) | 27.8% | 25.6% | 28.8% | 23.7% | 20.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Maruwa Co Ltd ($MAW) | 6.5% | 4.4% | 6.1% | 6.9% | |
| Gooch & Housego ($GHH) | 3.9% | 11.3% | 5.2% | 4.7% | 4.5% |
| Dewhurst ($DWHA) | 1.9% | 1.9% | 1.8% | 2.1% | 9.3% |
| Lpa Group ($LPA) | 1.8% | 6.0% | 7.3% | 1.8% | |
| Elektron Technology ($EKT) | 1.1% | 1.8% | 0.9% | 1.3% | |
| |
|---|
| Median (8 companies) | 1.4% | 1.7% | 1.6% | 1.6% | 4.5% |
|---|
| Zytronic ($ZYT) | 4.7% | 1.8% | 2.1% | 1.2% | 2.5% |
Top companies by ROIC, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Maruwa Co Ltd ($MAW) | 5.7% | 9.0% | 11.4% | 19.2% | |
| Dewhurst ($DWHA) | 27.3% | 24.6% | 24.1% | 18.9% | 14.1% |
| Elektron Technology ($EKT) | 9.9% | 7.0% | -9.0% | 18.8% | |
| Solid State ($SSP) | 20.0% | 23.0% | 14.6% | 15.2% | |
| Lpa Group ($LPA) | 2.1% | 13.4% | 15.9% | 13.8% | |
| |
|---|
| Median (11 companies) | 5.7% | 9.4% | 13.4% | 14.5% | 5.7% |
|---|
| Zytronic ($ZYT) | 22.7% | 18.1% | 20.9% | 15.1% | 11.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Lpa Group ($LPA) | 3.8x | 1.3x | 1.1x | 0.7x | |
| Gooch & Housego ($GHH) | -1.1x | -0.8x | -0.8x | 0.6x | 0.8x |
| Solid State ($SSP) | 0.7x | 0.7x | -0.3x | -0.2x | |
| Volex ($VLX) | -0.7x | 0.3x | | -0.8x | |
| Elektron Technology ($EKT) | 0.8x | 0.5x | -0.5x | -1.0x | |
| |
|---|
| Median (7 companies) | 0.5x | 0.4x | -0.5x | -0.8x | -0.6x |
|---|
| Zytronic ($ZYT) | -1.4x | -2.2x | -2.1x | -2.8x | -3.2x |
