Ceres Power Hldgs reports 27.8% CAPEX decline in 2020 while 23.5% Revenue growth
28 Sep 2020 • About Ceres Power Hldgs (
$CWR) • By InTwits
Ceres Power Hldgs reported FY2020 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Ceres Power Hldgs is a fast growth stock: FY2020 revenue growth was 23.5%, 5 year revenue CAGR was 126% at FY2020 ROIC -9.3%
- The company operates at negative EBITDA Margin: -38.9%
- Ceres Power Hldgs spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for FY2016-FY2020 is 0.0%. Average EBITDA Margin for the same period was -104.4%
- Ceres Power Hldgs has high CAPEX intensity: 5 year average CAPEX/Revenue was 49.5%. At the same time it's a lot of higher than industry average of 8.5%.
- CAPEX is quite volatile: £6m in FY2020, £8m in FY2019, £1m in FY2018, £1m in FY2017, £1m in FY2016
- The company has unprofitable business model: ROIC is -9.3%
- It operates with high leverage: Net Debt/EBITDA is 4.5x while industry average is -0.1x
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 jumped on 23.5%. Revenue decline was accelerating on average at -47.9 pp per annum in FY2016-FY2020. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 128 pp from 12.8% to -115% in FY2020. EBITDA Margin followed a growing trend at 228 pp per annum in FY2016-FY2020.
Gross Margin decreased on 2.1 pp from 75.1% to 73.0% in FY2020. SG&A as a % of Revenue increased on 4.4 pp from 30.2% to 34.6% in FY2020. SG&A as a % of Revenue followed a declining trend at -69.3 pp per annum in FY2016-FY2020.
Net Income margin decreased on 6.9 pp from -31.6% to -38.5% in FY2020. Net Income margin stuck to a growing trend at 207 pp per annum in the last 5 years.
Investments (CAPEX, working capital and M&A)
Ceres Power Hldgs's CAPEX/Revenue was 29.4% in FY2020. Ceres Power Hldgs showed small growth in CAPEX/Revenue of 1.7 pp from 27.7% in FY2017 to 29.4% in FY2020. It's average level of CAPEX/Revenue for the last three years was 34.2%.
Return on investment
The company operates at negative ROIC (-9.3%) and ROE (-6.8%). ROIC increased on 7.1 pp from -16.4% to -9.3% in FY2020. ROE increased on 3.2 pp from -10.1% to -6.8% in FY2020. ROIC followed a growing trend at 22.4 pp per annum in FY2016-FY2020. ROE stuck to a growing trend at 18.9 pp per annum in the last 5 years.
Leverage (Debt)
Company's Net Debt / EBITDA is 4.5x and Debt / EBITDA is . Debt surged while cash jumped on 127%.
Ceres Power Hldgs has no short term refinancing risk: cash is higher than short term debt (1,676.3%).
Management team
The company's CEO Phil Caldwell has spent 7 years with the company. The company's CFO is Richard Timothy Preston. Richard Timothy Preston has 8 years tenure at the company.
Financial and operational results
Ceres Power Hldgs ($CWR) key annual financial indicators| mln. £ | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 1.113 | 3.119 | 6.329 | 15.300 | 18.897 | 23.5% |
| Gross Profit | 0.777 | 1.785 | 3.232 | 11.496 | 13.802 | 20.1% |
| SG&A | 3.714 | 3.907 | 4.432 | 4.618 | 6.529 | 41.4% |
| EBITDA | -11.516 | -10.263 | -10.772 | -6.819 | -7.344 | |
| Net Income | -10.460 | -9.408 | -9.924 | -4.834 | -7.268 | |
Balance Sheet
|
|---|
| Cash | 1.805 | 15.354 | 3.828 | 7.567 | 17.199 | 127.3% |
| Short Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 1.026 | |
| Long Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 3.823 | |
Cash flow
|
|---|
| Capex | 1.302 | 0.863 | 1.454 | 7.693 | 5.554 | -27.8% |
Ratios
|
|---|
| Revenue growth | 243.5% | 180.2% | 102.9% | 141.7% | 23.5% | |
| EBITDA growth | | -10.9% | 5.0% | -36.7% | 7.7% | |
|
|---|
| Gross Margin | 69.8% | 57.2% | 51.1% | 75.1% | 73.0% | -2.1% |
| EBITDA Margin | -1,034.7% | -329.0% | -170.2% | -44.6% | -38.9% | 5.7% |
| SG&A, % of revenue | 333.7% | 125.3% | 70.0% | 30.2% | 34.6% | 4.4% |
| Net Income Margin | -939.8% | -301.6% | -156.8% | -31.6% | -38.5% | -6.9% |
| CAPEX, % of revenue | 117.0% | 27.7% | 23.0% | 50.3% | 29.4% | -20.9% |
|
|---|
| ROIC | -90.8% | -77.5% | -74.6% | -16.4% | -9.3% | 7.1% |
| ROE | -74.8% | -63.3% | -62.0% | -10.1% | -6.8% | 3.2% |
Peers in Alternative Energy
Below you can find Ceres Power Hldgs benchmarking vs. other companies in Alternative Energy 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 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Porvair ($PRV) | 14.1% | 6.5% | 10.7% | 12.5% | - |
| |
|---|
| Median (1 company) | -26.8% | 6.1% | -44.6% | 12.5% | - |
|---|
| Ceres Power Hldgs ($CWR) | - | 180.2% | 102.9% | 141.7% | 23.5% |
Top companies by Gross margin, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Porvair ($PRV) | 32.9% | 32.9% | 34.4% | 32.7% | - |
| |
|---|
| Median (1 company) | 14.6% | 14.5% | -3,678.0% | 32.7% | - |
|---|
| Ceres Power Hldgs ($CWR) | 69.8% | 57.2% | 51.1% | 75.1% | 73.0% |
Top companies by EBITDA margin, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Porvair ($PRV) | 12.1% | 13.4% | 12.8% | 12.8% | - |
| |
|---|
| Median (1 company) | -1.4% | 13.4% | -621,454.7% | 12.8% | - |
|---|
| Ceres Power Hldgs ($CWR) | -1,034.7% | -329.0% | -170.2% | -44.6% | -38.9% |
Top companies by CAPEX/Revenue, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Porvair ($PRV) | 4.0% | 4.5% | 2.9% | 2.7% | - |
| |
|---|
| Median (1 company) | 2.9% | 1.9% | 12,488.9% | 2.7% | - |
|---|
| Ceres Power Hldgs ($CWR) | 117.0% | 27.7% | 23.0% | 50.3% | 29.4% |
Top companies by ROIC, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Porvair ($PRV) | 16.7% | 16.8% | 14.9% | 14.6% | - |
| Afc Energy ($AFC) | -126.8% | -82.8% | -77.9% | -94.5% | - |
| |
|---|
| Median (2 companies) | -3.3% | 4.6% | -31.5% | -39.9% | - |
|---|
| Ceres Power Hldgs ($CWR) | -90.8% | -77.5% | -74.6% | -16.4% | -9.3% |
Top companies by Net Debt / EBITDA
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Porvair ($PRV) | -1.0x | -0.6x | -0.4x | -0.2x | - |
| |
|---|
| Median (1 company) | -1.0x | -0.6x | -0.4x | -0.2x | - |
|---|
