Qumu Corporation revenue dropped on 11.2% while EBITDA Margin increased on 2.5 pp from -20.7% to -18.2%
03/05/2019 • About Qumu Corporation (
$QUMU) • By InTwits
Qumu Corporation 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: -18.2%
- Qumu Corporation 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 -49.0%
- Qumu Corporation has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.3%. At the same time it's a lot of higher than industry average of 6.1%.
- CAPEX is quite volatile: $0m in 2018, $0m in 2017, $0m in 2016, $1m in 2015, $1m in 2014
- The company has unprofitable business model: ROIC is -48.3%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Qumu Corporation's Revenue dropped on 11.2%. Annual revenue decline showed slowdown in 18Q4 - revenue decreased on 4.5%. Revenue decline was accelerating on average at -16.2 pp per annum in 2014-2018. Revenue decline happened at the same time with EBITDA margin expansion. EBITDA Margin increased on 2.5 pp from -20.7% to -18.2% in 2018. EBITDA Margin grew at 22.0 pp per annum in the last 5 years.
Gross Margin increased on 2.5 pp from 63.6% to 66.0% in 2018. Gross Margin stuck to a growing trend at 5.6 pp per annum in the last 5 years. SG&A as a % of Revenue decreased on 4.0 pp from 66.0% to 62.0% in 2018. SG&A as a % of Revenue followed a declining trend at -14.2 pp per annum in the last 5 years.
Net Income margin jumped on 27.2 pp from -41.6% to -14.5% in 2018.
Investments (CAPEX, working capital and M&A)
Qumu Corporation's CAPEX/Revenue was 0.51% in 2018. CAPEX/Revenue decreased slightly on 1.3 pp from 1.8% in 2015 to 0.51% in 2018. For the last three years the average CAPEX/Revenue was 0.28%. During 2014-2018 CAPEX as a % of Revenue bottomed in 2017 at 0.085%.
Return on investment
The company operates at negative ROIC (-48.3%) and ROE (-44.7%). ROIC decreased on 8.1 pp from -40.3% to -48.3% in 2018. ROE jumped on 39.8 pp from -84.4% to -44.7% in 2018.
Leverage (Debt)
Company's Net Debt / EBITDA is -1.6x and Debt / EBITDA is . Debt dropped on 57.9% while cash surged on 12.3%.
Qumu Corporation has no short term refinancing risk: cash is higher than short term debt (5,681.6%).
Management team
Vernon J Hanzlik "Vern" is a Qumu Corporation's CEO. Vernon J Hanzlik "Vern" is a founder and has spent 3 years with the company. David Gallagher Ristow "Dave" is a Qumu Corporation's CFO. David Gallagher Ristow "Dave" has spent 1 year at the company.
Financial and operational results
FY ended 12/31/2018
Qumu Corporation ($QUMU) key annual financial indicators| mln. $ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 26.521 | 34.454 | 31.682 | 28.167 | 25.013 | -11.2% |
| Gross Profit | 12.049 | 16.955 | 19.322 | 17.905 | 16.520 | -7.7% |
| SG&A | 30.617 | 34.872 | 21.251 | 18.593 | 15.516 | -16.5% |
| EBITDA | -26.677 | -26.286 | -8.058 | -5.826 | -4.547 | |
| Net Income | -8.520 | -28.699 | -11.175 | -11.724 | -3.617 | |
Balance Sheet
|
|---|
| Cash | 11.684 | 7.072 | 10.364 | 7.690 | 8.636 | 12.3% |
| Short Term Debt | 0.000 | 0.502 | 0.508 | 1.047 | 0.152 | -85.5% |
| Long Term Debt | 0.000 | 0.519 | 6.787 | 7.608 | 3.488 | -54.2% |
Cash flow
|
|---|
| Capex | 1.051 | 0.635 | 0.076 | 0.024 | 0.127 | 429.2% |
Ratios
|
|---|
| Revenue growth | 49.5% | 29.9% | -8.0% | -11.1% | -11.2% | |
| EBITDA growth | 49.7% | -1.5% | -69.3% | -27.7% | -22.0% | |
|
|---|
| Gross Margin | 45.4% | 49.2% | 61.0% | 63.6% | 66.0% | 2.5% |
| EBITDA Margin | -100.6% | -76.3% | -25.4% | -20.7% | -18.2% | 2.5% |
| SG&A, % of revenue | 115.4% | 101.2% | 67.1% | 66.0% | 62.0% | -4.0% |
| Net Income Margin | -32.1% | -83.3% | -35.3% | -41.6% | -14.5% | 27.2% |
| CAPEX, % of revenue | 4.0% | 1.8% | 0.2% | 0.1% | 0.5% | 0.4% |
|
|---|
| ROIC | -47.1% | -64.0% | -38.9% | -40.3% | -48.3% | -8.1% |
| ROE | -14.1% | -64.5% | -45.3% | -84.4% | -44.7% | 39.8% |
Qumu Corporation ($QUMU) key quoterly financial indicators
| mln. $ | 18Q1 | 18Q2 | 18Q3 | 18Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 5 | 8 | 6 | 7 | | -28.0% | 14.6% | -25.4% | -4.5% |
| EBITDA | -3 | -0 | -1 | -0 | | | | | |
| Net Income | -5 | -2 | 2 | 0 | | | | | |
Balance Sheet
|
|---|
| Cash | 7 | 5 | 8 | 9 | | -37.0% | -42.1% | 9.8% | 12.3% |
| Short Term Debt | 0 | 0 | 0 | 0 | | -67.9% | -42.6% | -49.3% | -85.5% |
| Long Term Debt | 8 | 8 | 3 | 3 | | 14.7% | 17.7% | -51.9% | -54.2% |
Ratios
|
|---|
| Gross Margin | 56.3% | 68.5% | 62.6% | 73.1% | | -5.2% | 2.8% | 1.0% | 7.4% |
| EBITDA Margin | -63.7% | -2.1% | -20.0% | -2.7% | | -28.8% | 19.2% | -4.6% | 9.8% |
| Net Income Margin | -93.8% | -20.1% | 42.4% | 0.7% | | -40.7% | 19.2% | 72.9% | 45.5% |
Peers in Application Software
Below we provide Qumu Corporation benchmarking against other companies in Application Software 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 |
|---|
| 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 ($INS) | | 14.2% | 71.0% | 12.2% | 119.0% |
| |
|---|
| Median (151 companies) | -43.3% | 13.5% | 14.3% | 15.7% | 15.2% |
|---|
| Qumu Corporation ($QUMU) | | 29.9% | -8.0% | -11.1% | -11.2% |
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. ($AZPN) | 86.5% | 88.7% | 89.7% | 90.2% | 89.9% |
| |
|---|
| Median (150 companies) | 63.4% | 61.9% | 64.2% | 64.6% | 65.7% |
|---|
| Qumu Corporation ($QUMU) | 45.4% | 49.2% | 61.0% | 63.6% | 66.0% |
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. ($ADBE) | 17.5% | 25.9% | 31.2% | 34.2% | 35.3% |
| |
|---|
| Median (152 companies) | -10.1% | -9.4% | -4.7% | -3.3% | -3.2% |
|---|
| Qumu Corporation ($QUMU) | -100.6% | -76.3% | -25.4% | -20.7% | -18.2% |
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. ($ELLI) | 12.3% | 20.6% | 16.7% | 21.1% | 19.4% |
| |
|---|
| Median (153 companies) | 2.8% | 2.7% | 3.0% | 2.3% | 2.4% |
|---|
| Qumu Corporation ($QUMU) | 4.0% | 1.8% | 0.2% | 0.1% | 0.5% |
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. ($PAYC) | 16.7% | 30.5% | 75.4% | 51.1% | 47.5% |
| |
|---|
| Median (179 companies) | -14.2% | -11.2% | -9.2% | -10.2% | -9.3% |
|---|
| Qumu Corporation ($QUMU) | -47.1% | -64.0% | -38.9% | -40.3% | -48.3% |
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 |
|---|
