Telaria, Inc. reports 521% Net Income decline in 2018 while 26.0% Revenue growth
02/26/2019 • About Telaria, Inc. (
$TLRA) • By InTwits
Telaria, Inc. reported 2018 financial results today. Overall the company's long term financial model is characterised by the following facts:
- The company operates at negative EBITDA Margin: -13.5%
- Telaria, Inc. spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for 2014-2018 is 0.0%. Average EBITDA Margin for the same period was -18.7%
- Telaria, Inc. has low CAPEX intensity: 5 year average CAPEX/Revenue was 4.9%. At the same time it's a lot of higher than industry average of 3.1%.
- CAPEX is quite volatile: $3m in 2018, $1m in 2017, $3m in 2016, $8m in 2015, $4m in 2014
- The company has unprofitable business model: ROIC is -15.9%
- It operates with high leverage: Net Debt/EBITDA is 14.5x while industry average is -2.2x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue surged on 26.0%. Revenue growth showed acceleration in 18Q4 - it increased 30.9% YoY. Revenue growth happened at the same time with EBITDA margin expansion. EBITDA Margin jumped on 17.3 pp from -30.8% to -13.5% in 2018. During the last 5 years EBITDA Margin bottomed in 2016 at -49.0% and was growing since that time.
Gross Margin decreased on 4.5 pp from 92.1% to 87.6% in 2018. During the last 5 years Gross Margin topped in 2016 at 92.4% and was declining since that time. SG&A as a % of Revenue dropped on 27.5 pp from 110% to 82.7% in 2018. During 2014-2018 SG&A as a % of Revenue topped in 2016 at 132% and was declining since that time.
Net Income margin dropped on 22.1 pp from 5.1% to -17.0% in 2018.
Investments (CAPEX, working capital and M&A)
Telaria, Inc.'s CAPEX/Revenue was 5.0% in 2018. CAPEX/Revenue increased slightly on 0.52 pp from 4.4% in 2015 to 5.0% in 2018. It's average CAPEX/Revenue for the last three years was 5.9%.
Return on investment
The company operates at negative ROIC (-15.9%) and ROE (-13.6%). ROIC surged on 10.2 pp from -26.1% to -15.9% in 2018. ROE dropped on 16.4 pp from 2.8% to -13.6% in 2018.
Leverage (Debt)
The company has no debt. Cash dropped on 37.6%.
Management team
Telaria, Inc.'s CEO is Mark S Zagorski. Mark S Zagorski is a founder and has 1 year tenure with the company. Telaria, Inc.'s CFO John S Rego has spent 1 year with the company.
Financial and operational results
FY ended 12/31/2018
Telaria, Inc. ($TLRA) key annual financial indicators| mln. $ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 159.5 | 173.8 | 29.1 | 43.8 | 55.2 | 26.0% |
| Gross Profit | 57.8 | 74.6 | 26.9 | 40.4 | 48.3 | 19.8% |
| SG&A | 57.3 | 66.2 | 38.4 | 48.3 | 45.6 | -5.5% |
| EBITDA | -16.5 | -34.4 | -14.3 | -13.5 | -7.4 | |
| Net Income | -23.5 | -43.2 | -20.9 | 2.2 | -9.4 | -520.6% |
Balance Sheet
|
|---|
| Cash | 77.8 | 59.9 | 43.2 | 76.3 | 47.7 | -37.6% |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 4.0 | 7.7 | 2.9 | 1.1 | 2.7 | 146.2% |
Ratios
|
|---|
| Revenue growth | 21.0% | 9.0% | -83.2% | 50.4% | 26.0% | |
| EBITDA growth | 129.0% | 108.5% | -58.6% | -5.5% | -44.9% | |
|
|---|
| Gross Margin | 36.2% | 42.9% | 92.4% | 92.1% | 87.6% | -4.5% |
| EBITDA Margin | -10.4% | -19.8% | -49.0% | -30.8% | -13.5% | 17.3% |
| SG&A, % of revenue | 35.9% | 38.1% | 131.7% | 110.2% | 82.7% | -27.5% |
| Net Income Margin | -14.7% | -24.9% | -71.9% | 5.1% | -17.0% | -22.1% |
| CAPEX, % of revenue | 2.5% | 4.4% | 10.1% | 2.5% | 5.0% | 2.4% |
|
|---|
| ROIC | -16.0% | -35.2% | -25.9% | -26.1% | -15.9% | 10.2% |
| ROE | -15.8% | -35.8% | -23.3% | 2.8% | -13.6% | -16.4% |
Telaria, Inc. ($TLRA) key quoterly financial indicators
| mln. $ | 18Q1 | 18Q2 | 18Q3 | 18Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 10 | 12 | 13 | 20 | | 56.4% | 25.1% | 6.0% | 30.9% |
| EBITDA | -5 | -3 | -1 | 2 | | | | | 304.4% |
| Net Income | -6 | -3 | -2 | 1 | | | | -112.9% | |
Balance Sheet
|
|---|
| Cash | 73 | 65 | 71 | 48 | | 158.9% | 79.7% | -8.6% | -37.6% |
| Short Term Debt | 0 | 0 | 0 | 0 | | -100.0% | -100.0% | | |
| Long Term Debt | 0 | 0 | 0 | 0 | | -100.0% | -100.0% | | |
Ratios
|
|---|
| Gross Margin | 89.3% | 90.9% | 86.1% | 85.7% | | 1.7% | 0.1% | -7.9% | -7.6% |
| EBITDA Margin | -52.3% | -25.3% | -7.4% | 8.9% | | 64.5% | 18.0% | 11.8% | 6.0% |
| Net Income Margin | -63.5% | -25.1% | -11.7% | 7.3% | | 48.2% | -2.0% | -108.4% | 13.3% |
Peers in Application Software
Below you can find Telaria, Inc. benchmarking vs. other companies in Application Software 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 |
|---|
| nFusz Inc ($FUSZ) | | | | | 433.3% |
| CloudCommerce Inc ($CLWD) | | -38.1% | 247.6% | 40.9% | 301.1% |
| Seven Stars Cloud Group, Inc. ($SSC) | | 134.7% | 663.8% | 310.3% | 161.7% |
| Aurora Mobile Limited ($JG) | | | | 304.9% | 150.8% |
| Intelligent Systems Corporation ($INS) | | 14.2% | 71.0% | 12.2% | 119.0% |
| |
|---|
| Median (151 companies) | -43.3% | 14.0% | 14.3% | 14.8% | 15.2% |
|---|
| Telaria, Inc. ($TLRA) | | 9.0% | -83.2% | 50.4% | 26.0% |
Top companies by Gross margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Skkynet Cloud Systems Inc ($SKKY) | 99.7% | 97.4% | 98.0% | 97.6% | 96.5% |
| hopTo Inc ($HPTO) | 91.8% | 87.8% | 95.9% | 98.2% | 95.4% |
| Aware, Inc. ($AWRE) | 75.4% | 87.2% | 90.3% | 94.6% | 92.3% |
| Alteryx, Inc. ($AYX) | 77.5% | 80.5% | 81.3% | 83.4% | 91.0% |
| Aspen Technology, Inc. ($AZPN) | 86.5% | 88.7% | 89.7% | 90.2% | 89.9% |
| |
|---|
| Median (150 companies) | 63.4% | 61.9% | 63.8% | 64.4% | 65.7% |
|---|
| Telaria, Inc. ($TLRA) | 36.2% | 42.9% | 92.4% | 92.1% | 87.6% |
Top companies by EBITDA margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Aspen Technology, Inc. ($AZPN) | 34.5% | 42.2% | 46.0% | 45.2% | 43.3% |
| ANSYS, Inc. ($ANSS) | 45.9% | 45.8% | 45.1% | 41.9% | 41.4% |
| Paycom Software, Inc. ($PAYC) | 15.1% | 19.5% | 35.1% | 34.4% | 35.9% |
| j2 Global, Inc. ($JCOM) | 41.6% | 40.6% | 41.7% | 36.5% | 35.7% |
| Adobe Inc. ($ADBE) | 17.5% | 25.9% | 31.2% | 34.2% | 35.3% |
| |
|---|
| Median (152 companies) | -10.1% | -9.4% | -4.7% | -3.3% | -3.2% |
|---|
| Telaria, Inc. ($TLRA) | -10.4% | -19.8% | -49.0% | -30.8% | -13.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| TimefireVR Inc ($TFVR) | 0.0% | 350.5% | 4.3% | | 1,021.9% |
| MGT Capital Investments Inc ($MGTI) | 0.0% | 36.5% | 221.4% | 129.8% | 344.5% |
| Integrated Ventures Inc ($INTV) | | | | | 199.9% |
| ShotSpotter, Inc. ($SSTI) | | 18.3% | 28.9% | 27.1% | 24.3% |
| Ellie Mae, Inc. ($ELLI) | 12.3% | 20.6% | 16.7% | 21.1% | 19.4% |
| |
|---|
| Median (153 companies) | 2.8% | 2.7% | 2.9% | 2.3% | 2.4% |
|---|
| Telaria, Inc. ($TLRA) | 2.5% | 4.4% | 10.1% | 2.5% | 5.0% |
Top companies by ROIC, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| InsPro Technologies Corp ($ITCC) | -558.9% | | | | 127.4% |
| Manhattan Associates, Inc. ($MANH) | 64.8% | 78.7% | 99.3% | 102.5% | 80.9% |
| Intuit Inc. ($INTU) | 34.2% | 23.7% | 52.1% | 72.6% | 66.8% |
| Aspen Technology, Inc. ($AZPN) | 133.4% | | | | 58.1% |
| Paycom Software, Inc. ($PAYC) | 16.7% | 30.5% | 75.4% | 51.1% | 47.5% |
| |
|---|
| Median (179 companies) | -14.2% | -11.2% | -9.2% | -10.2% | -9.3% |
|---|
| Telaria, Inc. ($TLRA) | -16.0% | -35.2% | -25.9% | -26.1% | -15.9% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Upland Software, Inc. ($UPLD) | | | 16.4x | 115.6x | 16.7x |
| Nuance Communications, Inc. ($NUAN) | 7.9x | 5.7x | 5.3x | 7.1x | 15.2x |
| Asure Software Inc ($ASUR) | 3.4x | 4.5x | 3.6x | 9.5x | 14.5x |
| SS&C Technologies Holdings, Inc. ($SSNC) | 1.7x | 7.3x | 4.6x | 3.1x | 8.5x |
| Avaya Holdings Corp. ($AVYA) | | | | | 7.4x |
| |
|---|
| Median (70 companies) | -1.4x | -1.0x | -0.9x | -0.8x | -0.7x |
|---|
