Brooks Macdonald Group EBITDA surged on 31.8% and EBITDA Margin increased on 4.0 pp from 13.3% to 17.4%
17 Sep 2020 • About Brooks Macdonald Group (
$BRK) • By InTwits
Brooks Macdonald Group reported FY2020 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Brooks Macdonald Group has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.2%. At the same time it's in pair with industry average of 1.5%
- CAPEX is quite volatile: £2m in FY2020, £1m in FY2019, £2m in FY2018, £1m in FY2017, £1m in FY2016
- The company has business model with low profitability: ROIC is 8.9%
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 increased slightly on 1.2%. During FY2016-FY2020 Revenue growth topped in FY2018 at 12.6% and was decelerating since that time. Revenue growth happened at the same time with EBITDA margin expansion. EBITDA Margin increased on 4.0 pp from 13.3% to 17.4% in FY2020. During the last 5 years EBITDA Margin bottomed in FY2018 at 12.0% and was growing since that time.
SG&A as a % of Revenue increased slightly on 0.79 pp from 85.6% to 86.4% in FY2020.
Net Income margin increased slightly on 0.58 pp from 5.3% to 5.9% in FY2020. During FY2016-FY2020 Net Income margin bottomed in FY2019 at 5.3%.
Investments (CAPEX, working capital and M&A)
The company's CAPEX/Revenue was 1.8% in FY2020. Brooks Macdonald Group's CAPEX/Revenue increased slightly on 0.80 pp from 1.0% in FY2017 to 1.8% in FY2020. It's average level of CAPEX/Revenue for the last three years was 1.4%.
Return on investment
The company operates at low ROIC (8.9%) and ROE (6.1%). ROIC showed almost no change in FY2020. ROE showed almost no change in FY2020.
Leverage (Debt)
Company's Net Debt / EBITDA is -2.2x and Debt / EBITDA is 0.4x. Debt surged while cash jumped on 45.0%.
Brooks Macdonald Group has no short term refinancing risk: cash is higher than short term debt (3,934.7%).
Valuation and dividends
The company's trades at EV/EBITDA 12.6x and P/E 43.6x.
Financial and operational results
Brooks Macdonald Group ($BRK) key annual financial indicators| mln. £ | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 81.4 | 88.8 | 99.9 | 107.3 | 108.6 | 1.2% |
| SG&A | 67.8 | 80.9 | 89.3 | 91.8 | 93.8 | 2.1% |
| EBITDA | 20.1 | 13.0 | 12.0 | 14.3 | 18.9 | 31.8% |
| Net Income | 12.7 | 5.8 | 5.4 | 5.7 | 6.4 | 12.2% |
Balance Sheet
|
|---|
| Cash | 19.5 | 32.2 | 30.9 | 34.6 | 50.2 | 45.0% |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 1.3 | |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 6.7 | |
Cash flow
|
|---|
| Capex | 0.8 | 0.9 | 1.8 | 0.6 | 2.0 | 242.3% |
Ratios
|
|---|
| Revenue growth | 4.8% | 9.1% | 12.6% | 7.3% | 1.2% | |
| EBITDA growth | 26.7% | -35.2% | -7.7% | 19.0% | 31.8% | |
|
|---|
| EBITDA Margin | 24.7% | 14.7% | 12.0% | 13.3% | 17.4% | 4.0% |
| SG&A, % of revenue | 83.3% | 91.1% | 89.4% | 85.6% | 86.4% | 0.8% |
| Net Income Margin | 15.7% | 6.5% | 5.4% | 5.3% | 5.9% | 0.6% |
| CAPEX, % of revenue | 0.9% | 1.0% | 1.8% | 0.5% | 1.8% | 1.3% |
|
|---|
| ROIC | 20.0% | 9.2% | 7.5% | 9.1% | 8.9% | -0.2% |
| ROE | 16.2% | 6.9% | 6.2% | 6.5% | 6.1% | -0.4% |
| Net Debt/EBITDA | -1.0x | -2.5x | -2.6x | -2.4x | -2.2x | 0.2x |
Peers in Financial Services
Below you can find Brooks Macdonald Group benchmarking vs. other companies in Financial 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 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Mxc Capital ($MXCP) | 118.4% | -3.5% | -76.6% | 214.9% | - |
| Afh Financial Group ($AFHP) | 15.0% | 39.4% | 50.6% | 46.7% | - |
| Private & Commercial Finance Group ($PCF) | 13.2% | -60.1% | 22.4% | 36.2% | - |
| Commercial Bank Of Qatar(The) ($CBQS) | 1.7% | 6.1% | 17.8% | 12.4% | - |
| Impax Asset Management Group ($IPX) | 6.8% | 55.2% | 100.9% | 12.2% | - |
| |
|---|
| Median (16 companies) | 5.9% | 13.2% | 16.1% | 5.0% | 3.1% |
|---|
| Brooks Macdonald Group ($BRK) | - | 9.1% | 12.6% | 7.3% | 1.2% |
Top companies by Gross margin, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| 1Pm ($OPM) | 64.3% | 64.0% | 66.3% | 67.7% | - |
| Afh Financial Group ($AFHP) | 55.4% | 53.4% | 54.4% | 53.4% | - |
| Starvest ($SVE) | 38.4% | 49.4% | - | 18.5% | - |
| |
|---|
| Median (3 companies) | 59.3% | 51.4% | 54.1% | 53.4% | 20.3% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Mxc Capital ($MXCP) | 105.4% | -263.1% | -755.1% | 299.5% | - |
| Starvest ($SVE) | 63.4% | 56.4% | - | 134.5% | - |
| Ashmore Group ($ASHM) | 57.1% | 65.0% | 63.6% | 62.1% | 61.0% |
| Plus500 Ltd ($PLUS) | 46.0% | 59.3% | 70.2% | 54.2% | - |
| City Of London Investment Group ($CLIG) | 32.5% | 37.5% | 37.8% | 33.9% | 36.8% |
| |
|---|
| Median (11 companies) | 20.8% | 23.5% | 26.7% | 29.5% | 30.9% |
|---|
| Brooks Macdonald Group ($BRK) | 24.7% | 14.7% | 12.0% | 13.3% | 17.4% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Mattioli Woods ($MTW) | 2.6% | 16.3% | 13.2% | 2.9% | 1.4% |
| 1Pm ($OPM) | 4.4% | 6.4% | 3.4% | 2.4% | - |
| Commercial Bank Of Qatar(The) ($CBQS) | 3.3% | 1.8% | 3.8% | 1.9% | - |
| City Of London Investment Group ($CLIG) | 0.6% | 1.6% | 0.4% | 1.3% | 0.2% |
| Afh Financial Group ($AFHP) | 1.8% | 0.8% | 0.5% | 1.1% | - |
| |
|---|
| Median (14 companies) | 1.0% | 1.0% | 1.0% | 0.6% | 0.5% |
|---|
| Brooks Macdonald Group ($BRK) | 0.9% | 1.0% | 1.8% | 0.5% | 1.8% |
Top companies by ROIC, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Plus500 Ltd ($PLUS) | 118.9% | 143.2% | 196.2% | 65.4% | - |
| City Of London Investment Group ($CLIG) | 55.3% | 71.6% | 63.7% | 47.5% | 52.0% |
| Impax Asset Management Group ($IPX) | 15.0% | 19.7% | 30.7% | 28.8% | - |
| Ashmore Group ($ASHM) | 17.6% | 23.5% | 24.3% | 23.9% | 23.4% |
| Starvest ($SVE) | 5.9% | 18.5% | -18.6% | 21.4% | - |
| |
|---|
| Median (19 companies) | 8.6% | 10.0% | 7.7% | 9.8% | 13.5% |
|---|
| Brooks Macdonald Group ($BRK) | 20.0% | 9.2% | 7.5% | 9.1% | 8.9% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Redde ($REDD) | 1.3x | 1.3x | 1.8x | 1.6x | 2.4x |
| Afh Financial Group ($AFHP) | -1.0x | -1.1x | -1.8x | 0.2x | - |
| 1Pm ($OPM) | 0.2x | -0.2x | 0.3x | 0.2x | - |
| Starvest ($SVE) | -0.1x | -1.5x | - | -0.2x | - |
| Impax Asset Management Group ($IPX) | -0.6x | -2.0x | -0.3x | -0.5x | - |
| |
|---|
| Median (11 companies) | -1.3x | -1.3x | -0.9x | -1.3x | -1.2x |
|---|
| Brooks Macdonald Group ($BRK) | -1.0x | -2.5x | -2.6x | -2.4x | -2.2x |
