Signet Jewelers Ltd EBITDA dropped on 17.7% and EBITDA Margin decreased on 2.3 pp from 14.9% to 12.5%
03/14/2018 • About Signet Jewelers Ltd (
$SIG) • By InTwits
Signet Jewelers Ltd reported FY2018 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Signet Jewelers Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 3.8%. At the same time it's in pair with industry average of 3.8%
- The company has highly profitable business model: ROIC is 13.0%
- It operates with medium-size leverage: Net Debt/EBITDA is 0.6x while industry average is 0.6x
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 decreased on 2.4%. During the last 5 years Revenue growth topped in FY2015 at 36.3% and was decelerating since that time. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 2.3 pp from 14.9% to 12.5% in FY2018.
Gross Margin decreased slightly on 1.8 pp from 36.8% to 35.0% in FY2018. SG&A as a % of Revenue increased slightly on 0.60 pp from 29.3% to 29.9% in FY2018.
Net Income margin showed almost no change in FY2018.
Investments (CAPEX, working capital and M&A)
In FY2018 Signet Jewelers Ltd had CAPEX/Revenue of 3.8%. CAPEX/Revenue showed almost no change from FY2015 to FY2018. For the last three years the average CAPEX/Revenue was 3.9%.
Return on investment
The company operates at good ROIC (13.0%) and ROE (19.7%). ROIC decreased on 3.0 pp from 16.0% to 13.0% in FY2018. ROE showed almost no change in FY2018. ROE stuck to a growing trend at 1.4 pp per annum in the last 5 years.
Leverage (Debt)
Debt level is 0.6x Net Debt / EBITDA and 0.9x Debt / EBITDA. Net Debt / EBITDA dropped on 0.7x from 1.4x to 0.6x in FY2018. Debt dropped on 48.0% while cash jumped on 128%. During the last 5 years Net Debt/EBITDA topped in FY2015 at 1.7x and was declining since that time.
Signet Jewelers Ltd has no short term refinancing risk: cash is higher than short term debt (511.6%).
Financial and operational results
FY ended 02/03/2018
Signet Jewelers Ltd ($SIG) key annual financial indicators| mln. $ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 4,209 | 5,736 | 6,550 | 6,408 | 6,253 | -2.4% |
| Gross Profit | 1,580 | 2,074 | 2,440 | 2,361 | 2,190 | -7.2% |
| SG&A | 1,197 | 1,713 | 1,988 | 1,880 | 1,872 | -0.4% |
| EBITDA | 681 | 726 | 879 | 952 | 783 | -17.7% |
| Net Income | 368 | 381 | 468 | 543 | 519 | -4.4% |
Balance Sheet
|
|---|
| Cash | 248 | 194 | 138 | 99 | 225 | 128.1% |
| Short Term Debt | 19 | 98 | 58 | 91 | 44 | -51.7% |
| Long Term Debt | 0 | 1,364 | 1,321 | 1,318 | 688 | -47.8% |
Cash flow
|
|---|
| Capex | 153 | 220 | 227 | 278 | 237 | -14.6% |
Ratios
|
|---|
| Revenue growth | 5.7% | 36.3% | 14.2% | -2.2% | -2.4% | |
| EBITDA growth | 3.2% | 6.7% | 21.0% | 8.3% | -17.7% | |
|
|---|
| Gross Margin | 37.5% | 36.2% | 37.3% | 36.8% | 35.0% | -1.8% |
| EBITDA Margin | 16.2% | 12.7% | 13.4% | 14.9% | 12.5% | -2.3% |
| SG&A, % of revenue | 28.4% | 29.9% | 30.3% | 29.3% | 29.9% | 0.6% |
| Net Income Margin | 8.7% | 6.6% | 7.1% | 8.5% | 8.3% | -0.2% |
| CAPEX, % of revenue | 3.6% | 3.8% | 3.5% | 4.3% | 3.8% | -0.5% |
|
|---|
| ROIC | 20.4% | 15.5% | 15.2% | 16.0% | 13.0% | -3.0% |
| ROE | 15.0% | 14.2% | 15.9% | 19.2% | 19.7% | 0.4% |
| Net Debt/EBITDA | -0.3x | 1.7x | 1.4x | 1.4x | 0.6x | -0.7x |
Peers in General Retailers
Below you can find Signet Jewelers Ltd benchmarking vs. other companies in General Retailers 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.
