SCI Engineered Materials Inc Net Income jumped on 14,805% and Revenue surged on 67.0%
02/05/2019 • About SCI Engineered Materials Inc (
$SCIA) • By InTwits
SCI Engineered Materials Inc reported 2018 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is quite volatile: 12.2% in 2018, 7.6% in 2017, -3.8% in 2016, 4.4% in 2015, 3.9% in 2014
- SCI Engineered Materials Inc has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.6%. At the same time it's in pair with industry average of 3.6%
- CAPEX is quite volatile: $0m in 2018, $0m in 2017, $0m in 2016, $0m in 2015, $0m in 2014
- The company has highly profitable business model: ROIC is 26.6%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue jumped on 67.0%. Revenue growth showed acceleration in 18Q4 - it increased 180.4% YoY. During 2014-2018 Revenue growth bottomed in 2016 at -32.1% and was accelerating since that time. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 36.2 pp from -1.6% to -37.9% in 2018.
Gross Margin increased on 2.4 pp from 23.2% to 25.6% in 2018. SG&A as a % of Revenue decreased on 3.4 pp from 17.6% to 14.2% in 2018. During the last 5 years SG&A as a % of Revenue topped in 2016 at 26.1% and was declining since that time.
Net Income margin increased on 7.9 pp from 0.090% to 8.0% in 2018.
Investments (CAPEX, working capital and M&A)
In 2018 SCI Engineered Materials Inc had CAPEX/Revenue of 3.4%. The company showed CAPEX/Revenue growth of 2.7 pp from 0.61% in 2015 to 3.4% in 2018. It's average CAPEX/Revenue for the last three years was 2.2%. CAPEX as a % of Revenue followed a growing trend at 0.63 pp per annum in 2014-2018.
Return on investment
The company operates at high and attractive ROIC (26.6%) and ROE (35.5%). ROIC jumped on 24.9 pp from 1.6% to 26.6% in 2018. ROE jumped on 36.5 pp from -0.96% to 35.5% in 2018.
Leverage (Debt)
Company's Net Debt / EBITDA is -1.0x and Debt / EBITDA is 0.3x. Debt dropped on 11.0% while cash jumped on 95.8%.
SCI Engineered Materials Inc has no short term refinancing risk: cash is higher than short term debt (552.9%).
Valuation and dividends
SCI Engineered Materials Inc's trades at EV/EBITDA 9.4x and P/E 15.9x.
Financial and operational results
FY ended 12/31/2018
SCI Engineered Materials Inc ($SCIA) key annual financial indicators| mln. $ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 9.255 | 8.049 | 5.466 | 6.801 | 11.362 | 67.0% |
| Gross Profit | 1.849 | 1.970 | 1.084 | 1.578 | 2.905 | 84.1% |
| SG&A | 1.693 | 1.624 | 1.426 | 1.198 | 1.618 | 35.1% |
| EBITDA | 0.364 | 0.355 | -0.206 | 0.519 | 1.388 | 167.3% |
| Net Income | -0.220 | -0.149 | -0.706 | 0.006 | 0.908 | 14,805.1% |
Balance Sheet
|
|---|
| Cash | 1.012 | 0.997 | 0.730 | 0.921 | 1.803 | 95.8% |
| Short Term Debt | 0.444 | 0.321 | 0.294 | 0.351 | 0.326 | -7.0% |
| Long Term Debt | 0.950 | 0.609 | 0.447 | 0.182 | 0.148 | -18.6% |
Cash flow
|
|---|
| Capex | 0.059 | 0.049 | 0.090 | 0.104 | 0.381 | 266.2% |
Ratios
|
|---|
| Revenue growth | 16.0% | -13.0% | -32.1% | 24.4% | 67.0% | |
| EBITDA growth | 27.6% | -2.5% | -157.9% | -352.5% | 167.3% | |
|
|---|
| Gross Margin | 20.0% | 24.5% | 19.8% | 23.2% | 25.6% | 2.4% |
| EBITDA Margin | 3.9% | 4.4% | -3.8% | 7.6% | 12.2% | 4.6% |
| SG&A, % of revenue | 18.3% | 20.2% | 26.1% | 17.6% | 14.2% | -3.4% |
| Net Income Margin | -2.4% | -1.9% | -12.9% | 0.1% | 8.0% | 7.9% |
| CAPEX, % of revenue | 0.6% | 0.6% | 1.6% | 1.5% | 3.4% | 1.8% |
|
|---|
| ROIC | -3.6% | -2.3% | -19.5% | 1.6% | 26.6% | 24.9% |
| ROE | -10.7% | -7.5% | -35.5% | -1.0% | 35.5% | 36.5% |
| Net Debt/EBITDA | 1.0x | -0.2x | | -0.7x | -1.0x | -0.2x |
SCI Engineered Materials Inc ($SCIA) key quoterly financial indicators
| mln. $ | 18Q1 | 18Q2 | 18Q3 | 18Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 2 | 3 | 3 | 4 | | 34.6% | 33.1% | 34.1% | 180.4% |
| EBITDA | 0 | 0 | 0 | 0 | | 138.1% | 127.9% | 145.7% | 262.8% |
| Net Income | 0 | 0 | 0 | 0 | | | 363.1% | | 14,116.1% |
Balance Sheet
|
|---|
| Cash | 2 | 3 | 2 | 2 | | 154.4% | 162.5% | 114.2% | 95.8% |
| Short Term Debt | 0 | 0 | 0 | 0 | | -15.2% | -20.1% | -31.6% | -7.0% |
| Long Term Debt | 0 | 0 | 0 | 0 | | -46.6% | -47.9% | -43.5% | -18.6% |
Ratios
|
|---|
| Gross Margin | 25.0% | 31.0% | 25.1% | 22.9% | | 0.5% | 6.8% | 6.4% | -3.6% |
| EBITDA Margin | 11.3% | 17.8% | 9.4% | 11.0% | | 4.9% | 7.4% | 4.3% | 2.5% |
| Net Income Margin | 4.2% | 12.6% | 5.4% | 8.5% | | 7.1% | 9.0% | 6.7% | 8.3% |
Peers in Semiconductor Equipment
Below you can find SCI Engineered Materials Inc benchmarking vs. other companies in Semiconductor Equipment 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 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Atomera Incorporated ($ATOM) | | | | | 123.6% |
| ACM Research, Inc. ($ACMR) | | | -12.3% | 33.4% | 104.5% |
| Aehr Test Systems ($AEHR) | | -49.1% | 44.7% | 30.3% | 56.4% |
| SolarEdge Technologies, Inc. ($SEDG) | | 144.0% | 50.7% | 23.9% | 54.4% |
| Lam Research Corporation ($LRCX) | | 14.2% | 11.9% | 36.1% | 38.2% |
| |
|---|
| Median (37 companies) | | -0.5% | 7.8% | 24.5% | 14.0% |
|---|
| SCI Engineered Materials Inc ($SCIA) | | -13.0% | -32.1% | 24.4% | 67.0% |
Top companies by Gross margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Xperi Corporation ($XPER) | 99.5% | 99.8% | 99.8% | 98.3% | 96.7% |
| KLA-Tencor Corporation ($KLAC) | 57.9% | 56.8% | 61.0% | 63.0% | 64.1% |
| Teradyne, Inc. ($TER) | 53.3% | 55.8% | 54.7% | 57.2% | 58.1% |
| Nova Measuring Instruments Ltd. ($NVMI) | 52.7% | 51.9% | 45.9% | 59.1% | 57.8% |
| Nanometrics Incorporated ($NANO) | 47.2% | 47.9% | 51.6% | 52.9% | 56.7% |
| |
|---|
| Median (38 companies) | 34.6% | 38.9% | 40.0% | 44.0% | 41.2% |
|---|
| SCI Engineered Materials Inc ($SCIA) | 20.0% | 24.5% | 19.8% | 23.2% | 25.6% |
Top companies by EBITDA margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| KLA-Tencor Corporation ($KLAC) | 29.2% | 26.4% | 34.4% | 38.3% | 39.6% |
| DAQO New Energy Corp. ($DQ) | 32.9% | 31.6% | 43.3% | 49.1% | 36.1% |
| Xperi Corporation ($XPER) | 66.7% | 67.5% | 47.6% | 23.4% | 34.3% |
| Lam Research Corporation ($LRCX) | 21.1% | 20.3% | 23.2% | 27.6% | 32.0% |
| Cabot Microelectronics Corporation ($CCMP) | 21.6% | 22.6% | 23.4% | 27.2% | 31.5% |
| |
|---|
| Median (37 companies) | 7.0% | 10.3% | 12.1% | 16.2% | 16.6% |
|---|
| SCI Engineered Materials Inc ($SCIA) | 3.9% | 4.4% | -3.8% | 7.6% | 12.2% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Rubicon Technology, Inc. ($RBCN) | 15.0% | 4.0% | 3.6% | 0.0% | 58.8% |
| DAQO New Energy Corp. ($DQ) | 42.2% | 44.7% | 29.5% | 19.8% | 47.4% |
| AXT Inc ($AXTI) | 2.4% | 5.4% | 3.4% | 21.6% | 39.6% |
| STR Holdings Inc ($STRI) | 7.9% | 8.1% | 1.6% | 9.0% | 36.6% |
| Photronics, Inc. ($PLAB) | 20.0% | 19.8% | 10.4% | 20.4% | 17.3% |
| |
|---|
| Median (37 companies) | 2.3% | 2.9% | 2.6% | 3.2% | 2.9% |
|---|
| SCI Engineered Materials Inc ($SCIA) | 0.6% | 0.6% | 1.6% | 1.5% | 3.4% |
Top companies by ROIC, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| KLA-Tencor Corporation ($KLAC) | 17.9% | 16.5% | 27.2% | 34.0% | 39.9% |
| Lam Research Corporation ($LRCX) | 10.7% | 10.9% | 11.8% | 18.7% | 33.9% |
| Versum Materials, Inc. ($VSM) | | 26.2% | 32.4% | 30.0% | 32.1% |
| Advanced Energy Industries, Inc. ($AEIS) | 8.8% | 30.2% | 41.2% | 45.7% | 31.3% |
| SolarEdge Technologies, Inc. ($SEDG) | -815.6% | 33.6% | 31.2% | 26.5% | 28.6% |
| |
|---|
| Median (39 companies) | 3.5% | 6.0% | 7.6% | 13.1% | 11.2% |
|---|
| SCI Engineered Materials Inc ($SCIA) | -3.6% | -2.3% | -19.5% | 1.6% | 26.6% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Xperi Corporation ($XPER) | -0.3x | -0.1x | 4.2x | 5.0x | 2.6x |
| Ultra Clean Holdings, Inc. ($UCTT) | -1.2x | 1.5x | 0.4x | -0.2x | 2.4x |
| Ichor Holdings ($ICHR) | 3.1x | 1.7x | -0.4x | 2.0x | 1.8x |
| Versum Materials, Inc. ($VSM) | -0.2x | -0.1x | 2.7x | 2.1x | 1.4x |
| DAQO New Energy Corp. ($DQ) | 4.6x | 4.3x | 2.3x | 0.9x | 1.2x |
| |
|---|
| Median (31 companies) | -1.2x | -1.3x | -1.3x | -0.7x | -1.0x |
|---|
| SCI Engineered Materials Inc ($SCIA) | 1.0x | -0.2x | | -0.7x | -1.0x |
