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Tsb Banking Grp revenue dropped on 19.3%

30 Jan 2020 • About Tsb Banking Grp ($TSB) • By InTwits

Tsb Banking Grp reported 2019 financial results today. Here are the key drivers of the company's long term financial model:
  • Tsb Banking Grp has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.9%. At the same time it's in pair with industry average of 1.8%
  • CAPEX is quite volatile: £18m in 2019, £16m in 2018, £16m in 2017, £36m in 2016, £40m in 2015
  • The company has potentially unprofitable business model: ROIC is 0.6%
  • It operates with high leverage: Net Debt/EBITDA is 5.6x 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


Tsb Banking Grp's Revenue dropped on 19.3%.

Net Income margin increased on 6.3 pp from -4.1% to 2.1% in 2019.

Investments (CAPEX, working capital and M&A)


Tsb Banking Grp's CAPEX/Revenue was 1.5% in 2019. The company's CAPEX/Revenue decreased slightly on 1.2 pp from 2.7% in 2016 to 1.5% in 2019. For the last three years the average CAPEX/Revenue was 1.2%. During 2015-2019 CAPEX as a % of Revenue bottomed in 2018 at 1.0%.

Return on investment


The company operates at low ROIC (0.6%) and ROE (1.4%). ROIC increased slightly on 1.8 pp from -1.3% to 0.55% in 2019. ROE increased on 4.7 pp from -3.3% to 1.4% in 2019.

Leverage (Debt)


Debt dropped on 27.0% while cash dropped on 35.6%.

The company has no short term refinancing risk: short term debt is zero.

Financial and operational results


FY ended 31 Dec 2019

Tsb Banking Grp ($TSB) key annual financial indicators

mln. £201520162017201820192019/2018
P&L
Revenue1,1741,3451,3851,5231,229-19.3%
Net Income89128119-6326
Balance Sheet
Cash2,9193,9127,5817,1384,595-35.6%
Short Term Debt150000
Long Term Debt4024136,0316,8805,021-27.0%
Cash flow
Capex403616161813.9%
Ratios
Revenue growth-1.4%14.5%2.9%10.0%-19.3%
Net Income Margin7.6%9.5%8.6%-4.1%2.1%6.3%
CAPEX, % of revenue3.4%2.7%1.1%1.0%1.5%0.4%
ROIC3.3%8.3%3.1%-1.3%0.6%1.8%
ROE5.3%7.1%6.1%-3.3%1.4%4.7%

Peers in Banks


Below we provide Tsb Banking Grp 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 FY2015 FY2016 FY2017 FY2018 FY2019
Bank Muscat ($BKM)6.9%8.2%5,513.3%19.2%
Yapi Ve Kredi Bankasi As ($YKBD)25.3%17.8%18.8%51.8%
Turkiye Garanti Bankasi ($39IS)20.4%18.6%50.6%7.9%
Finansbank ($FBKD)16.8%19.0%50.1%13.9%
Turk Ekonomi Bankasi As ($TURA)14.6%18.1%2.6%44.8%
 
Median (19 companies)4.8%3.4%4.5%12.9%8.1%
Tsb Banking Grp ($TSB)14.5%2.9%10.0%-19.3%


Top companies by CAPEX/Revenue, %

Top 5 FY2015 FY2016 FY2017 FY2018 FY2019
Banco Santander Sa ($BNC)10.2%9.1%10.0%14.7%
Bcb Hldgs Ltd ($BCBW)2.5%3.0%7.3%5.9%
Barclays ($BARC)7.1%6.3%5.4%4.9%
Royal Bank Of Scotland Group ($RBS)4.6%5.6%7.1%3.7%
Turkiye Garanti Bankasi ($39IS)2.4%3.6%2.4%3.5%1.1%
 
Median (16 companies)2.5%2.0%1.9%1.4%1.1%
Tsb Banking Grp ($TSB)3.4%2.7%1.1%1.0%1.5%


Top companies by ROIC, %

Top 5 FY2015 FY2016 FY2017 FY2018 FY2019
Bcb Hldgs Ltd ($BCBW)-8.7%5.7%5.0%34.6%
Commercial Intl Bank(Egypt)S.A.E ($CBKD)30.3%28.0%25.3%25.4%
Komercni Banka ($KMCA)7.4%8.0%9.1%8.7%
Turkiye Garanti Bankasi ($39IS)4.3%5.5%6.5%6.5%6.3%
Finansbank ($FBKD)3.1%4.3%4.6%5.4%4.7%
 
Median (34 companies)3.5%4.5%4.6%4.5%4.6%
Tsb Banking Grp ($TSB)3.3%8.3%3.1%-1.3%0.6%


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