Vishay Precision Group, Inc. reports 64.8% Net Income growth in 2018 and 2.9 pp EBITDA Margin growth from 13.0% to 16.0%
02/20/2019 • About Vishay Precision Group, Inc. (
$VPG) • By InTwits
Vishay Precision Group, Inc. reported 2018 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is expanding: 16.0% in 2018 vs. 13.0% in 2017 vs. 7.7% in 2014
- EBITDA Margin is quite volatile: 16.0% in 2018, 13.0% in 2017, 9.7% in 2016, 6.2% in 2015, 7.7% in 2014
- Vishay Precision Group, Inc. has low CAPEX intensity: 5 year average CAPEX/Revenue was 4.0%. At the same time it's in pair with industry average of 3.6%
- CAPEX is quite volatile: $2m in 2018, $6m in 2017, $3m in 2016, $4m in 2015, $3m in 2014
- The company has highly profitable business model: ROIC is 15.2%
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 17.9%. Revenue growth showed slowdown in 18Q4 - it was 10.9% YoY. During 2014-2018 Revenue growth bottomed in 2015 at -7.1% and was accelerating since that time. Despite revenue decline the EBITDA margin expanded. EBITDA Margin surged on 24.8 pp from 20.4% to 45.2% in 2018. EBITDA Margin grew at 2.3 pp per annum in the last 5 years.
Gross Margin increased slightly on 1.8 pp from 38.6% to 40.5% in 2018. Gross Margin grew at 1.1 pp per annum in 2014-2018. SG&A as a % of Revenue decreased slightly on 2.0 pp from 29.0% to 27.0% in 2018. SG&A as a % of Revenue stuck to a declining trend at -0.93 pp per annum in the last 5 years.
Net Income margin increased on 2.2 pp from 5.6% to 7.9% in 2018. During 2014-2018 Net Income margin bottomed in 2015 at -5.6% and was growing since that time.
Investments (CAPEX, working capital and M&A)
The company's CAPEX/Revenue was 4.8% in 2018. CAPEX/Revenue increased slightly on 0.55 pp from 4.3% in 2015 to 4.8% in 2018. It's average CAPEX/Revenue for the last three years was 4.1%.
Return on investment
The company operates at good ROIC (15.2%) while ROE is low (11.5%). ROIC increased on 5.3 pp from 10.0% to 15.2% in 2018. ROE increased on 3.6 pp from 7.9% to 11.5% in 2018. ROIC grew at 3.3 pp per annum in the last 5 years. During 2014-2018 ROE bottomed in 2015 at -7.0% and was growing since that time.
Leverage (Debt)
Company's Net Debt / EBITDA is -1.3x and Debt / EBITDA is 0.6x. Debt dropped on 16.3% while cash jumped on 21.4%.
Vishay Precision Group, Inc. has no short term refinancing risk: cash is higher than short term debt (1,937.2%).
Valuation and dividends
Vishay Precision Group, Inc.'s trades at EV/EBITDA 7.5x and P/E 17.8x.
Management team
Ziv Shoshani is a the company's CEO. Ziv Shoshani is a founder and has spent 9 years with the company. William Michael Clancy is a Vishay Precision Group, Inc.'s CFO. William Michael Clancy has spent 9 years at the company.
Financial and operational results
FY ended 12/31/2018
Vishay Precision Group, Inc. ($VPG) key annual financial indicators| mln. $ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 250.0 | 232.2 | 224.9 | 254.4 | 299.8 | 17.9% |
| Gross Profit | 90.8 | 84.2 | 82.8 | 98.3 | 121.3 | 23.4% |
| SG&A | 77.0 | 71.3 | 68.9 | 73.8 | 80.9 | 9.7% |
| EBITDA | 19.2 | 14.5 | 21.9 | 33.1 | 47.9 | 44.5% |
| Net Income | 3.1 | -13.0 | 6.4 | 14.3 | 23.6 | 64.8% |
Balance Sheet
|
|---|
| Cash | 79.6 | 62.6 | 58.5 | 74.3 | 90.2 | 21.4% |
| Short Term Debt | 5.1 | 2.1 | 2.6 | 3.9 | 4.7 | 20.0% |
| Long Term Debt | 17.7 | 31.0 | 33.5 | 28.5 | 22.4 | -21.3% |
Cash flow
|
|---|
| Capex | 9.1 | 10.0 | 10.4 | 7.0 | 14.5 | 108.6% |
Ratios
|
|---|
| Revenue growth | 4.1% | -7.1% | -3.1% | 13.1% | 17.9% | |
| EBITDA growth | -3.8% | -24.8% | 51.2% | 51.5% | 44.5% | |
|
|---|
| Gross Margin | 36.3% | 36.3% | 36.8% | 38.6% | 40.5% | 1.8% |
| EBITDA Margin | 7.7% | 6.2% | 9.7% | 13.0% | 16.0% | 2.9% |
| SG&A, % of revenue | 30.8% | 30.7% | 30.6% | 29.0% | 27.0% | -2.0% |
| Net Income Margin | 1.2% | -5.6% | 2.8% | 5.6% | 7.9% | 2.2% |
| CAPEX, % of revenue | 3.6% | 4.3% | 4.6% | 2.7% | 4.8% | 2.1% |
|
|---|
| ROIC | 3.2% | 1.5% | 5.0% | 10.0% | 15.2% | 5.3% |
| ROE | 1.5% | -7.0% | 3.7% | 7.9% | 11.5% | 3.6% |
| Net Debt/EBITDA | -3.0x | -2.0x | -1.0x | -1.3x | -1.3x | -0.1x |
Vishay Precision Group, Inc. ($VPG) key quoterly financial indicators
| mln. $ | 18Q1 | 18Q2 | 18Q3 | 18Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 73 | 74 | 75 | 77 | | 22.3% | 19.1% | 20.2% | 10.9% |
| EBITDA | 11 | 14 | 13 | 10 | | 69.4% | 27.4% | 61.7% | -0.3% |
| Net Income | 5 | 8 | 8 | 3 | | 150.0% | 112.6% | 77.4% | -23.6% |
Balance Sheet
|
|---|
| Cash | 74 | 75 | 79 | 90 | | 24.4% | 18.3% | 12.5% | 21.4% |
| Short Term Debt | 4 | 4 | 4 | 5 | | 43.2% | 43.3% | 47.3% | 20.0% |
| Long Term Debt | 28 | 27 | 24 | 22 | | -15.5% | -13.2% | -21.5% | -21.3% |
Ratios
|
|---|
| Gross Margin | 39.0% | 42.3% | 40.5% | 40.0% | | 1.3% | 2.5% | 1.9% | 1.5% |
| EBITDA Margin | 14.9% | 18.8% | 17.5% | 12.7% | | 4.1% | 1.2% | 4.5% | -1.4% |
| Net Income Margin | 6.8% | 10.4% | 10.0% | 4.4% | | 3.5% | 4.6% | 3.2% | -2.0% |
Peers in Electronic Equipment & Instrum
Below we provide Vishay Precision Group, Inc. benchmarking against other companies in Electronic Equipment & Instrum industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Hickok Inc ($HICKA) | | -7.2% | 13.5% | 258.4% | 178.7% |
| Electro Scientific Industries, Inc. ($ESIO) | | -12.2% | 15.9% | -12.7% | 128.5% |
| Microvision, Inc. ($MVIS) | | 163.6% | 60.7% | -34.7% | 82.8% |
| Ipsidy Inc ($IDTY) | | | | | 66.2% |
| Magal Security Systems Ltd. ($MAGS) | | -17.8% | 6.4% | -5.2% | 44.0% |
| |
|---|
| Median (61 companies) | -78.5% | 4.5% | 1.2% | 3.6% | 9.1% |
|---|
| Vishay Precision Group, Inc. ($VPG) | | -7.1% | -3.1% | 13.1% | 17.9% |
Top companies by Gross margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Intellicheck, Inc. ($IDN) | 58.2% | 57.1% | 80.0% | 85.5% | 91.3% |
| Image Sensing Systems, Inc. ($ISNS) | 74.7% | 77.1% | 71.0% | 79.9% | 80.9% |
| National Instruments Corporation ($NATI) | 74.4% | 74.1% | 74.5% | 74.5% | 75.4% |
| Cognex Corporation ($CGNX) | 77.9% | 77.2% | 75.2% | 75.6% | 74.4% |
| Applied DNA Sciences Inc ($APDN) | | | 82.2% | 77.3% | 69.1% |
| |
|---|
| Median (60 companies) | 42.7% | 42.3% | 41.2% | 41.8% | 42.0% |
|---|
| Vishay Precision Group, Inc. ($VPG) | 36.3% | 36.3% | 36.8% | 38.6% | 40.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Cognex Corporation ($CGNX) | 32.9% | 30.1% | 31.9% | 36.0% | 30.1% |
| Coherent, Inc. ($COHR) | 14.2% | 16.7% | 18.9% | 24.9% | 26.6% |
| Hollysys Automation Technologies, Ltd. ($HOLI) | 21.3% | 26.9% | 23.5% | 16.1% | 23.9% |
| Electro Scientific Industries, Inc. ($ESIO) | -10.1% | -19.1% | -2.0% | -17.8% | 23.1% |
| FLIR Systems, Inc. ($FLIR) | 20.7% | 22.8% | 21.3% | 20.0% | 21.7% |
| |
|---|
| Median (60 companies) | 5.3% | 3.9% | 3.0% | 3.0% | 3.3% |
|---|
| Vishay Precision Group, Inc. ($VPG) | 7.7% | 6.2% | 9.7% | 13.0% | 16.0% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Wrap Technologies Inc ($WRTC) | | | | | 61.4% |
| ClearSign Combustion Corporation ($CLIR) | | 80.3% | 22.1% | 17.4% | 17.7% |
| LightPath Technologies, Inc. ($LPTH) | 16.8% | 5.0% | 6.5% | 7.8% | 7.7% |
| Giga-tronics Inc ($GIGA) | 1.7% | 0.1% | 1.3% | 0.3% | 7.0% |
| Applied DNA Sciences Inc ($APDN) | 8.4% | 3.9% | 16.1% | 3.1% | 6.8% |
| |
|---|
| Median (60 companies) | 1.8% | 1.9% | 2.1% | 1.6% | 2.2% |
|---|
| Vishay Precision Group, Inc. ($VPG) | 3.6% | 4.3% | 4.6% | 2.7% | 4.8% |
Top companies by ROIC, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Evans & Sutherland Computer Corp ($ESCC) | | | 83.3% | 39.6% | 55.3% |
| Electro Scientific Industries, Inc. ($ESIO) | -11.7% | -19.7% | -7.1% | -22.9% | 31.5% |
| Coherent, Inc. ($COHR) | 9.9% | 13.1% | 15.6% | 24.0% | 21.5% |
| Zebra Technologies Corporation ($ZBRA) | 3.3% | 0.9% | 2.2% | 10.2% | 20.8% |
| Cognex Corporation ($CGNX) | 18.3% | 15.6% | 17.7% | 25.6% | 20.1% |
| |
|---|
| Median (72 companies) | 3.3% | 2.3% | 1.8% | 1.8% | 0.9% |
|---|
| Vishay Precision Group, Inc. ($VPG) | 3.2% | 1.5% | 5.0% | 10.0% | 15.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Itron, Inc. ($ITRI) | 2.1x | 1.9x | 1.0x | 2.0x | 12.3x |
| Track Group Inc ($TRCK) | | | | | 12.2x |
| Mesa Laboratories, Inc. ($MLAB) | 0.7x | 1.1x | 1.7x | 2.0x | 3.5x |
| Trimble Inc. ($TRMB) | 1.3x | 1.7x | 1.1x | 1.3x | 3.4x |
| MTS Systems Corporation ($MTSC) | -0.0x | -0.4x | 5.8x | 3.9x | 3.2x |
| |
|---|
| Median (35 companies) | -0.7x | -0.7x | -0.8x | -0.6x | -0.8x |
|---|
| Vishay Precision Group, Inc. ($VPG) | -3.0x | -2.0x | -1.0x | -1.3x | -1.3x |
