Local Shopping REIT reports 77.4% revenue decline in FY2019
30 Jan 2020 • About Local Shopping REIT (
$LSR) • By InTwits
Local Shopping REIT reported FY2019 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Local Shopping REIT is a company in decline: FY2019 revenue growth was -77.4%, 5 years revenue CAGR was -44.0%
- EBITDA Margin is relatively stable: in FY2019 vs. -193.6% in FY2018 vs. in FY2015
- Local Shopping REIT spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for FY2015-FY2019 is 0.0%. Average EBITDA Margin for the same period was -26.4%
- The company has unprofitable business model: ROIC is -10.9%
- It operates with medium-size leverage: Net Debt/EBITDA is 2.8x while industry average is 3.3x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Local Shopping REIT's Revenue dropped on 77.4%. During FY2015-FY2019 Revenue growth topped in FY2016 at -8.8% and was decelerating since that time.
Gross Margin dropped on 18.5 pp from 27.5% to 9.0% in FY2019. Gross Margin stuck to a declining trend at -17.7 pp per annum in FY2015-FY2019. SG&A as a % of Revenue surged on 162 pp from 45.0% to 207% in FY2019. SG&A as a % of Revenue pursued a growing trend in the last 5 years.
Net Income margin dropped on 33.7 pp from -212% to -245% in FY2019. Net Income margin stuck to a declining trend at -71.2 pp per annum in FY2015-FY2019.
Investments (CAPEX, working capital and M&A)
In FY2019 Local Shopping REIT had CAPEX/Revenue of 0.52%. CAPEX/Revenue decreased on 2.5 pp from 3.0% in FY2016 to 0.52% in FY2019. It's average level of CAPEX/Revenue for the last three years was 4.9%.
Return on investment
The company operates at negative ROIC (-10.9%) and ROE (-10.8%). ROIC increased on 3.1 pp from -14.0% to -10.9% in FY2019. ROE surged on 12.1 pp from -22.9% to -10.8% in FY2019. During FY2015-FY2019 ROIC bottomed in FY2018 at -14.0%.
Financial and operational results
FY ended 30 Nov -0001
Local Shopping REIT ($LSR) key annual financial indicators| mln. £ | 2015 | 2016 | 2017 | 2018 | 2019 | 2019/2018 |
|---|
P&L
|
|---|
| Revenue | 7.664 | 6.989 | 6.023 | 3.381 | 0.764 | -77.4% |
| Gross Profit | 5.704 | 5.127 | 4.055 | 0.930 | 0.069 | -92.6% |
| SG&A | 1.699 | 1.710 | 1.738 | 1.522 | 1.580 | 3.8% |
| EBITDA | | | | -6.545 | | |
| Interest expence | 3.986 | | | | | |
| Net Income | 0.020 | 0.631 | -0.858 | -7.154 | -1.874 | |
Balance Sheet
|
|---|
| Cash | 12.740 | 11.000 | 10.455 | 3.292 | 3.566 | 8.3% |
| Short Term Debt | 1.001 | 0.907 | 1.209 | 0.000 | | |
| Long Term Debt | 55.347 | 50.202 | 29.893 | 0.000 | 0.350 | |
Cash flow
|
|---|
| Capex | | 0.210 | 0.514 | 0.188 | 0.004 | -97.9% |
Ratios
|
|---|
| Revenue growth | -44.7% | -8.8% | -13.8% | -43.9% | -77.4% | |
|
|---|
| Gross Margin | 74.4% | 73.4% | 67.3% | 27.5% | 9.0% | -18.5% |
| EBITDA Margin | | | | -193.6% | |
| SG&A, % of revenue | 22.2% | 24.5% | 28.9% | 45.0% | 206.8% | 161.8% |
| Net Income Margin | 0.3% | 9.0% | -14.2% | -211.6% | -245.3% | -33.7% |
| CAPEX, % of revenue | | 3.0% | 8.5% | 5.6% | 0.5% | -5.0% |
|
|---|
| ROIC | 2.5% | 2.4% | 2.1% | -14.0% | -10.9% | 3.1% |
| ROE | 0.1% | 1.8% | -2.4% | -22.9% | -10.8% | 12.1% |
| Interest expence / Average debt | 7.1% | | | | | |
People
|
|---|
| Insider ownership | 29.3% | | | | | |
Peers in Real Estate Investment Trusts
Below we provide Local Shopping REIT benchmarking against other companies in Real Estate Investment Trusts 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 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Great Portland Estates ($GPOR) | -17.6% | 83.5% | -5.4% | 217.1% | |
| Segro ($SGRO) | -14.3% | 14.1% | 18.1% | 10.2% | |
| Town Centre Securities ($50BF) | 3.2% | 11.1% | 5.1% | 10.0% | |
| Primary Health Properties ($PHP) | 5.2% | 6.9% | 7.5% | 9.8% | |
| Shaftesbury ($SHB) | 8.2% | 7.6% | 5.0% | 9.5% | |
| |
|---|
| Median (9 companies) | 4.2% | 11.1% | 5.1% | 9.5% | |
|---|
| Local Shopping REIT ($LSR) | | -8.8% | -13.8% | -43.9% | -77.4% |
Top companies by EBITDA margin, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Mucklow(A.& J.)Group ($MKLW) | 277.1% | 121.8% | 130.8% | 274.1% | |
| Segro ($SGRO) | 242.1% | 141.2% | 322.3% | 269.8% | |
| Hibernia REIT ($HBRN) | | 428.5% | 277.6% | 231.8% | |
| Shaftesbury ($SHB) | 503.7% | 168.3% | 273.6% | 166.7% | |
| British Land Co ($BA45) | 215.1% | 165.3% | 36.3% | 87.6% | |
| |
|---|
| Median (7 companies) | 242.1% | 153.2% | 130.8% | 166.7% | |
|---|
| Local Shopping REIT ($LSR) | | | | -193.6% | |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Hibernia REIT ($HBRN) | 1,795.1% | 634.9% | 304.9% | 191.3% | |
| Segro ($SGRO) | 189.5% | 151.6% | 136.8% | 172.7% | |
| Shaftesbury ($SHB) | 51.6% | 83.7% | 61.2% | 148.3% | |
| Primary Health Properties ($PHP) | 46.7% | 144.4% | 104.0% | 128.0% | |
| British Land Co ($BA45) | 59.2% | 84.6% | 53.0% | 55.6% | |
| |
|---|
| Median (9 companies) | 59.2% | 84.6% | 82.3% | 55.6% | |
|---|
| Local Shopping REIT ($LSR) | | 3.0% | 8.5% | 5.6% | 0.5% |
Top companies by ROIC, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Mucklow(A.& J.)Group ($MKLW) | 18.5% | 8.2% | 8.7% | 16.9% | |
| Segro ($SGRO) | 12.0% | 7.1% | 15.9% | 12.0% | |
| Green REIT ($GRN) | 14.6% | 12.3% | 9.8% | 10.5% | |
| Hibernia REIT ($HBRN) | 2.1% | 16.3% | 11.6% | 9.0% | |
| Primary Health Properties ($PHP) | 9.4% | 7.2% | 10.2% | 7.4% | |
| |
|---|
| Median (9 companies) | 12.0% | 7.5% | 9.0% | 7.4% | |
|---|
| Local Shopping REIT ($LSR) | 2.5% | 2.4% | 2.1% | -14.0% | -10.9% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Town Centre Securities ($50BF) | 6.2x | 9.8x | 13.6x | 8.4x | |
| British Land Co ($BA45) | 3.2x | 3.7x | 14.8x | 5.4x | |
| Shaftesbury ($SHB) | 1.3x | 4.7x | 3.0x | 4.1x | |
| Segro ($SGRO) | 3.0x | 4.0x | 1.8x | 2.2x | |
| Hibernia REIT ($HBRN) | | 0.4x | 1.2x | 1.7x | |
| |
|---|
| Median (7 companies) | 3.0x | 3.9x | 2.7x | 2.2x | |
|---|
