Beazley Net Income jumped on 243%
06 Feb 2020 • About Beazley (
$BEZ) • By InTwits
Beazley reported 2019 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Beazley has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.1%.
- The company has potentially unprofitable business model: ROIC is 3.8%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Beazley's Revenue jumped on 22.1%.
Net Income margin increased on 5.7 pp from 3.2% to 8.9% in 2019. During the last 5 years Net Income margin bottomed in 2018 at 3.2%.
Investments (CAPEX, working capital and M&A)
In 2019 the company had CAPEX/Revenue of 0.24%. CAPEX/Revenue showed almost no change from 2016 to 2019. Average CAPEX/Revenue for the last three years was 0.15%.
Return on investment
The company operates at good ROE (15.1%) while ROIC is low (3.8%). ROIC increased on 2.3 pp from 1.5% to 3.8% in 2019. ROE jumped on 10.5 pp from 4.6% to 15.1% in 2019. During 2015-2019 ROE bottomed in 2018 at 4.6%.
Leverage (Debt)
Debt surged on 70.3% while cash dropped on 17.2%.
The company has no short term refinancing risk: short term debt is zero.
Management team
David Andrew Horton is a the company's CEO. David Andrew Horton is a founder and has spent 3 years with the company.
Financial and operational results
FY ended 31 Dec 2019
Beazley ($BEZ) key annual financial indicators| mln. | 2015 | 2016 | 2017 | 2018 | 2019 | 2019/2018 |
|---|
P&L
|
|---|
| Revenue | 1,787 | 1,894 | 2,043 | 2,159 | 2,637 | 22.1% |
| Net Income | 249 | 251 | 130 | 68 | 234 | 243.3% |
Balance Sheet
|
|---|
| Cash | 677 | 507 | 441 | 336 | 279 | -17.2% |
| Short Term Debt | 0 | 0 | 0 | 0 | 0 | |
| Long Term Debt | 247 | 364 | 366 | 344 | 586 | 70.3% |
Cash flow
|
|---|
| Capex | 3 | 3 | 2 | 3 | 6 | 142.3% |
Ratios
|
|---|
| Revenue growth | 1.1% | 6.0% | 7.9% | 5.7% | 22.1% | |
|
|---|
| Net Income Margin | 13.9% | 13.3% | 6.4% | 3.2% | 8.9% | 5.7% |
| CAPEX, % of revenue | 0.1% | 0.2% | 0.1% | 0.1% | 0.2% | 0.1% |
|
|---|
| ROIC | 4.8% | 4.8% | 2.8% | 1.5% | 3.8% | 2.3% |
| ROE | 17.9% | 17.2% | 8.7% | 4.6% | 15.1% | 10.5% |
Peers in Nonlife Insurance
Below we provide Beazley benchmarking against other companies in Nonlife Insurance 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 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Arab Insurance Group(Arig) ($AGRD) | -14.9% | -14.5% | 1.2% | 10.3% | |
| Marsh & Mclennan Cos Inc ($MHM) | | 2.5% | 6.2% | 6.6% | 11.4% |
| Lancashire Hldgs ($LRE) | -19.3% | -11.4% | -10.5% | -7.1% | |
| |
|---|
| Median (3 companies) | -7.1% | 2.5% | 4.6% | 6.6% | 11.4% |
|---|
| Beazley ($BEZ) | | 6.0% | 7.9% | 5.7% | 22.1% |
Top companies by EBITDA margin, %
| Top | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Marsh & Mclennan Cos Inc ($MHM) | 22.0% | 23.5% | 23.8% | 21.8% | 20.0% |
| |
|---|
| Median (1 company) | 22.0% | 23.5% | 23.8% | 21.8% | 20.0% |
|---|
Top companies by CAPEX/Revenue, %
| Top | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Marsh & Mclennan Cos Inc ($MHM) | 2.5% | 1.9% | 2.2% | 2.1% | 2.5% |
| Arab Insurance Group(Arig) ($AGRD) | 0.3% | 0.2% | 0.3% | 0.1% | |
| Lancashire Hldgs ($LRE) | 0.0% | 0.1% | 0.1% | 0.0% | |
| |
|---|
| Median (3 companies) | 0.2% | 0.3% | 0.3% | 0.1% | 2.5% |
|---|
| Beazley ($BEZ) | 0.1% | 0.2% | 0.1% | 0.1% | 0.2% |
Top companies by ROIC, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Marsh & Mclennan Cos Inc ($MHM) | 22.0% | 23.6% | 23.3% | 20.5% | 14.9% |
| Lancashire Hldgs ($LRE) | 6.6% | 6.2% | -1.7% | 2.2% | |
| Arab Insurance Group(Arig) ($AGRD) | -0.7% | 1.1% | 0.9% | -5.4% | |
| General Accident ($GACB) | 0.6% | 0.4% | 0.7% | | |
| Rsa Insurance Group ($RSAB) | 1.2% | 2.7% | 2.8% | | |
| |
|---|
| Median (5 companies) | 0.6% | 1.4% | 1.3% | 2.2% | 14.9% |
|---|
| Beazley ($BEZ) | 4.8% | 4.8% | 2.8% | 1.5% | 3.8% |
Top companies by Net Debt / EBITDA
| Top | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Marsh & Mclennan Cos Inc ($MHM) | 1.1x | 1.2x | 1.3x | 1.5x | 3.9x |
| |
|---|
| Median (1 company) | 1.1x | 1.2x | 1.3x | 1.5x | 3.9x |
|---|
