James Halstead Net Income decreased on 9.1% and Revenue decreased on 5.7%
01 Oct 2020 • About James Halstead (
$JHD) • By InTwits
James Halstead reported FY2020 financial results today. Here are the key drivers of the company's long term financial model:
- James Halstead has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.8%. At the same time it's in pair with industry average of 2.1%
- CAPEX is quite volatile: £3m in FY2020, £3m in FY2019, £8m in FY2018, £7m in FY2017, £5m in FY2016
- The company has highly profitable business model: ROIC is 32.3%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
James Halstead's Revenue decreased on 5.7%. During FY2016-FY2020 Revenue growth topped in FY2017 at 6.5% and was decelerating since that time. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased slightly on 0.72 pp from 20.3% to 21.1% in FY2020.
Gross Margin decreased slightly on 0.94 pp from 43.0% to 42.1% in FY2020. SG&A as a % of Revenue showed almost no change in FY2020.
Net Income margin decreased slightly on 0.54 pp from 14.9% to 14.4% in FY2020. Net Income margin stuck to a declining trend at -0.26 pp per annum in FY2016-FY2020.
Investments (CAPEX, working capital and M&A)
In FY2020 the company had CAPEX/Revenue of 1.8%. The company showed almost no change in CAPEX/Revenue from FY2017 to FY2020. It's average CAPEX/Revenue for the last three years was 1.6%. During FY2016-FY2020 CAPEX as a % of Revenue bottomed in FY2018 at 1.4% and was growing since that time.
Return on investment
The company operates at high and attractive ROIC (32.3%) and ROE (25.4%). ROIC decreased on 4.4 pp from 36.7% to 32.3% in FY2020. ROE decreased on 3.5 pp from 28.9% to 25.4% in FY2020. ROIC declined at -4.0 pp per annum in the last 5 years. ROE stuck to a declining trend at -2.4 pp per annum in FY2016-FY2020.
Leverage (Debt)
Company's Net Debt / EBITDA is -1.2x and Debt / EBITDA is 0.1x. Debt jumped on 2,970% while cash decreased slightly on 1.8%.
James Halstead has no short term refinancing risk: cash is higher than short term debt (2,626.4%).
Valuation and dividends
James Halstead's trades at EV/EBITDA 19.6x and P/E 30.5x.
Financial and operational results
James Halstead ($JHD) key annual financial indicators| mln. £ | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 226.1 | 240.8 | 249.5 | 253.0 | 238.6 | -5.7% |
| Gross Profit | 96.0 | 104.8 | 104.5 | 108.8 | 100.4 | -7.8% |
| SG&A | 49.9 | 57.5 | 57.4 | 60.4 | 56.2 | -6.9% |
| EBITDA | 49.0 | 50.1 | | 51.5 | 50.3 | -2.4% |
| Net Income | 35.3 | 36.5 | 36.7 | 37.8 | 34.4 | -9.1% |
Balance Sheet
|
|---|
| Cash | 44.1 | 52.5 | 50.7 | 68.7 | 67.4 | -1.8% |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 2.6 | |
| Long Term Debt | 0.2 | 0.2 | 0.2 | 0.2 | 3.6 | 1,685.5% |
Cash flow
|
|---|
| Capex | 4.8 | 4.2 | 3.6 | 4.3 | 4.2 | -1.1% |
Ratios
|
|---|
| Revenue growth | -0.5% | 6.5% | 3.6% | 1.4% | -5.7% | |
| EBITDA growth | 3.3% | 2.4% | | | -2.4% | |
|
|---|
| Gross Margin | 42.4% | 43.5% | 41.9% | 43.0% | 42.1% | -0.9% |
| EBITDA Margin | 21.6% | 20.8% | | 20.3% | 21.1% | 0.7% |
| SG&A, % of revenue | 22.1% | 23.9% | 23.0% | 23.9% | 23.6% | -0.3% |
| Net Income Margin | 15.6% | 15.2% | 14.7% | 14.9% | 14.4% | -0.5% |
| CAPEX, % of revenue | 2.1% | 1.8% | 1.4% | 1.7% | 1.8% | 0.1% |
|
|---|
| ROIC | 47.1% | 46.5% | 39.9% | 36.7% | 32.3% | -4.4% |
| ROE | 34.6% | 34.5% | 30.2% | 28.9% | 25.4% | -3.5% |
| Net Debt/EBITDA | -0.9x | -1.0x | | -1.3x | -1.2x | 0.1x |
Peers in Construction & Materials
Below you can find James Halstead benchmarking vs. other companies in Construction & Materials 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 |
|---|
| Volution Group ($FAN) | 18.7% | 19.8% | 11.1% | 14.6% | - |
| Aukett Swanke Group ($AUK) | 9.0% | -12.7% | -18.5% | 4.7% | - |
| Kier Group ($KIE) | - | 3.4% | 2.7% | -6.8% | -13.4% |
| Alumasc Group ($ALU) | - | 13.6% | -6.1% | -8.4% | -15.7% |
| Titon Hldgs ($TON) | 6.6% | 18.1% | 6.3% | -8.8% | - |
| |
|---|
| Median (6 companies) | 8.9% | 9.4% | 7.0% | -7.6% | -15.7% |
|---|
| James Halstead ($JHD) | - | 6.5% | 3.6% | 1.4% | -5.7% |
Top companies by Gross margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Volution Group ($FAN) | 48.8% | 49.2% | 47.0% | 47.1% | - |
| Titon Hldgs ($TON) | 29.7% | 25.9% | 28.9% | 30.2% | - |
| Alumasc Group ($ALU) | 33.4% | 31.3% | 30.6% | 29.8% | 29.7% |
| Kier Group ($KIE) | 8.9% | 7.0% | 9.5% | 7.4% | 5.9% |
| Galliford Try ($GFRD) | 10.9% | 7.9% | 9.7% | 0.7% | 2.6% |
| |
|---|
| Median (5 companies) | 29.7% | 25.9% | 26.2% | 29.8% | 5.9% |
|---|
| James Halstead ($JHD) | 42.4% | 43.5% | 41.9% | 43.0% | 42.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Volution Group ($FAN) | 22.2% | 20.6% | 17.6% | 18.9% | - |
| Titon Hldgs ($TON) | 9.8% | 8.8% | 9.0% | 8.8% | - |
| Alumasc Group ($ALU) | 9.7% | 9.8% | 7.8% | 3.9% | 6.9% |
| Aukett Swanke Group ($AUK) | 6.6% | -0.9% | -18.2% | 1.3% | - |
| Kier Group ($KIE) | 0.7% | 0.8% | 3.5% | -4.0% | -2.9% |
| |
|---|
| Median (7 companies) | 9.8% | 8.9% | 8.4% | 1.3% | -2.3% |
|---|
| James Halstead ($JHD) | 21.6% | 20.8% | - | 20.3% | 21.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Alumasc Group ($ALU) | 1.1% | 0.9% | 3.1% | 2.6% | 1.8% |
| Titon Hldgs ($TON) | 3.0% | 1.9% | 1.9% | 2.6% | - |
| Volution Group ($FAN) | 1.9% | 1.3% | 2.3% | 1.8% | - |
| Aukett Swanke Group ($AUK) | 0.8% | 0.2% | 0.6% | 0.7% | - |
| Kier Group ($KIE) | 0.4% | 0.4% | 0.5% | 0.3% | 0.1% |
| |
|---|
| Median (7 companies) | 2.4% | 2.0% | 2.1% | 0.7% | 0.1% |
|---|
| James Halstead ($JHD) | 2.1% | 1.8% | 1.4% | 1.7% | 1.8% |
Top companies by ROIC, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Titon Hldgs ($TON) | 13.3% | 12.0% | 12.2% | 9.5% | - |
| Volution Group ($FAN) | 9.0% | 9.2% | 6.9% | 8.8% | - |
| Alumasc Group ($ALU) | 47.8% | 50.2% | 23.1% | 4.8% | 7.8% |
| Aukett Swanke Group ($AUK) | 9.6% | -6.9% | -41.3% | -0.9% | - |
| Galliford Try ($GFRD) | 12.7% | 4.5% | 8.9% | -4.5% | -5.2% |
| |
|---|
| Median (8 companies) | 8.6% | 8.0% | 7.3% | -2.7% | -5.2% |
|---|
| James Halstead ($JHD) | 47.1% | 46.5% | 39.9% | 36.7% | 32.3% |
Top companies by Net Debt / EBITDA
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Volution Group ($FAN) | 1.0x | 1.0x | 2.1x | 1.7x | - |
| Alumasc Group ($ALU) | -1.0x | -0.6x | 0.6x | 1.5x | 1.9x |
| Titon Hldgs ($TON) | -1.0x | -1.3x | -1.3x | -1.9x | - |
| Aukett Swanke Group ($AUK) | -0.6x | - | - | -3.0x | - |
| |
|---|
| Median (4 companies) | -0.6x | -0.1x | -0.7x | -0.2x | 1.9x |
|---|
| James Halstead ($JHD) | -0.9x | -1.0x | - | -1.3x | -1.2x |
