Mulberry Group EBITDA surged on 317% and EBITDA Margin increased on 7.0 pp from 1.9% to 8.9%
05 Oct 2020 • About Mulberry Group (
$MUL) • By InTwits
Mulberry Group reported FY2020 financial results today. Here are the key drivers of the company's long term financial model:
- EBITDA Margin is quite volatile: 8.9% in FY2020, 1.9% in FY2019, 8.6% in FY2018, 9.8% in FY2017, 9.5% in FY2016
- Mulberry Group has low CAPEX intensity: 5 year average CAPEX/Revenue was 3.5%. At the same time it's a lot of higher than industry average of 2.4%.
- CAPEX is quite volatile: £5m in FY2020, £9m in FY2019, £5m in FY2018, £4m in FY2017, £5m in FY2016
- The company has unprofitable business model: ROIC is -44.6%
- It operates with high leverage: Net Debt/EBITDA is 6.8x while industry average is 2.3x
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 dropped on 10.2%. Revenue decline was accelerating on average at -4.0 pp per annum in FY2016-FY2020. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased on 7.0 pp from 1.9% to 8.9% in FY2020.
Gross Margin showed almost no change in FY2020.
Net Income margin dropped on 28.1 pp from -1.5% to -29.6% in FY2020. During FY2016-FY2020 Net Income margin topped in FY2018 at 3.8% and was declining since that time.
Investments (CAPEX, working capital and M&A)
Mulberry Group's CAPEX/Revenue was 3.4% in FY2020. Mulberry Group showed small growth in CAPEX/Revenue of 0.81 pp from 2.6% in FY2017 to 3.4% in FY2020. Average CAPEX/Revenue for the last three years was 4.0%.
Return on investment
The company operates at negative ROIC (-44.6%) and ROE (-88.7%). ROIC dropped on 38.9 pp from -5.8% to -44.6% in FY2020. ROE dropped on 85.8 pp from -2.9% to -88.7% in FY2020. During FY2016-FY2020 ROIC topped in FY2017 at 8.5% and was declining since that time. During the last 5 years ROE topped in FY2018 at 7.4% and was declining since that time.
Leverage (Debt)
Company's Net Debt / EBITDA is 6.8x and Debt / EBITDA is 7.4x. Net Debt / EBITDA jumped on 9.8x from -3.0x to 6.8x in FY2020. Debt jumped on 3,522% while cash dropped on 35.4%. During FY2016-FY2020 Net Debt/EBITDA bottomed in FY2019 at -3.0x.
Mulberry Group has short term refinancing risk: cash is only 42.6% of short term debt.
Financial and operational results
Mulberry Group ($MUL) key annual financial indicators| mln. £ | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 155.9 | 168.1 | 169.7 | 166.3 | 149.3 | -10.2% |
| Gross Profit | 96.6 | 103.6 | 107.7 | 102.3 | 91.1 | -10.9% |
| EBITDA | 14.8 | 16.4 | 14.6 | 3.2 | 13.3 | 317.4% |
| Net Income | 2.7 | 5.3 | 6.4 | -2.5 | -44.1 | |
Balance Sheet
|
|---|
| Cash | 14.0 | 21.1 | 25.1 | 12.4 | 8.0 | -35.4% |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 2.7 | 18.8 | 592.2% |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 79.4 | |
Cash flow
|
|---|
| Capex | 5.1 | 4.4 | 4.7 | 9.5 | 5.1 | -45.8% |
Ratios
|
|---|
| Revenue growth | 4.8% | 7.9% | 0.9% | -2.0% | -10.2% | |
| EBITDA growth | 28.6% | 10.9% | -11.0% | -78.2% | 317.4% | |
|
|---|
| Gross Margin | 62.0% | 61.6% | 63.5% | 61.5% | 61.0% | -0.5% |
| EBITDA Margin | 9.5% | 9.8% | 8.6% | 1.9% | 8.9% | 7.0% |
| Net Income Margin | 1.7% | 3.2% | 3.8% | -1.5% | -29.6% | -28.1% |
| CAPEX, % of revenue | 3.2% | 2.6% | 2.8% | 5.7% | 3.4% | -2.3% |
|
|---|
| ROIC | 7.2% | 8.5% | 8.3% | -5.8% | -44.6% | -38.9% |
| ROE | 3.4% | 6.5% | 7.4% | -2.9% | -88.7% | -85.8% |
| Net Debt/EBITDA | -0.9x | -1.3x | -1.7x | -3.0x | 6.8x | 9.8x |
Peers in Personal Goods
Below you can find Mulberry Group benchmarking vs. other companies in Personal Goods 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 |
|---|
| Creightons ($CRL) | - | 45.6% | 13.8% | 26.5% | 8.6% |
| Pz Cussons ($PZC) | - | -1.5% | -8.6% | -15.3% | -6.3% |
| Paternoster Resources ($PRS) | -0.1% | -40.3% | 16.9% | -31.9% | - |
| |
|---|
| Median (3 companies) | -6.2% | 4.7% | 6.7% | -15.3% | 1.1% |
|---|
| Mulberry Group ($MUL) | - | 7.9% | 0.9% | -2.0% | -10.2% |
Top companies by Gross margin, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Creightons ($CRL) | 42.2% | 42.5% | 40.6% | 39.4% | 42.2% |
| Pz Cussons ($PZC) | 37.9% | 38.5% | 35.5% | 37.9% | 38.7% |
| |
|---|
| Median (2 companies) | 23.7% | 23.1% | 35.5% | 38.7% | 40.4% |
|---|
| Mulberry Group ($MUL) | 62.0% | 61.6% | 63.5% | 61.5% | 61.0% |
Top companies by EBITDA margin, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Pz Cussons ($PZC) | 13.1% | 13.1% | 11.8% | 9.8% | 9.6% |
| Creightons ($CRL) | 4.7% | 6.1% | 6.4% | 8.9% | 11.1% |
| Paternoster Resources ($PRS) | 53.4% | -159.4% | 50.2% | -110.5% | - |
| |
|---|
| Median (3 companies) | 9.9% | 6.3% | 10.4% | 8.9% | 10.3% |
|---|
| Mulberry Group ($MUL) | 9.5% | 9.8% | 8.6% | 1.9% | 8.9% |
Top companies by CAPEX/Revenue, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Paternoster Resources ($PRS) | 102.1% | 3.6% | 2.6% | 34.4% | - |
| Creightons ($CRL) | 3.7% | 1.8% | 1.8% | 2.3% | 9.7% |
| Pz Cussons ($PZC) | 4.3% | 5.0% | 3.0% | 2.3% | 1.1% |
| |
|---|
| Median (3 companies) | 4.3% | 2.9% | 2.4% | 2.3% | 5.4% |
|---|
| Mulberry Group ($MUL) | 3.2% | 2.6% | 2.8% | 5.7% | 3.4% |
Top companies by ROIC, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Creightons ($CRL) | 6.7% | 15.5% | 14.4% | 23.6% | 21.8% |
| Pz Cussons ($PZC) | 9.8% | 9.8% | 7.6% | 4.8% | 4.3% |
| Paternoster Resources ($PRS) | 2.3% | -26.4% | 3.0% | -22.4% | - |
| |
|---|
| Median (3 companies) | 2.7% | 3.3% | 11.0% | 4.8% | 13.1% |
|---|
| Mulberry Group ($MUL) | 7.2% | 8.5% | 8.3% | -5.8% | -44.6% |
Top companies by Net Debt / EBITDA
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Pz Cussons ($PZC) | 1.4x | 1.4x | 1.9x | 2.5x | 1.1x |
| Creightons ($CRL) | -0.8x | -1.1x | -0.1x | 0.1x | 0.2x |
| |
|---|
| Median (2 companies) | 1.4x | 1.4x | 1.2x | 1.3x | 0.7x |
|---|
| Mulberry Group ($MUL) | -0.9x | -1.3x | -1.7x | -3.0x | 6.8x |
