I.D. Systems, Inc. reports 29.6% revenue growth in 2018 and 0.64 pp EBITDA Margin decline from -7.2% to -7.9%
03/06/2019 • About I.D. Systems, Inc. (
$IDSY) • By InTwits
I.D. Systems, Inc. reported 2018 financial results today. Here are the key drivers of the company's long term financial model:
- The company operates at negative EBITDA Margin: -7.9%
- I.D. Systems, Inc. motivates its personel by high Stock Based Compensation (SBC): average SBC/Revenue for 2014-2018 was 0.0% while average EBITDA Margin was -14.8% for the sames years
- I.D. Systems, Inc. has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.8%. At the same time it's in pair with industry average of 20.0%
- CAPEX is quite volatile: $0m in 2018, $0m in 2017, $1m in 2016, $2m in 2015, $0m in 2014
- The company has unprofitable business model: ROIC is -17.7%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue jumped on 29.6%. Revenue growth showed slowdown in 18Q4 - it was 2.9% YoY. During the last 5 years Revenue growth bottomed in 2016 at -11.9% and was accelerating since that time. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased slightly on 0.72 pp from -0.47% to 0.26% in 2018. EBITDA Margin followed a growing trend at 4.4 pp per annum in the last 5 years.
Gross Margin decreased on 2.5 pp from 51.1% to 48.6% in 2018. SG&A as a % of Revenue decreased on 4.9 pp from 51.4% to 46.5% in 2018. SG&A as a % of Revenue declined at -2.0 pp per annum in 2014-2018.
Net Income margin decreased slightly on 1.5 pp from -9.4% to -11.0% in 2018. Net Income margin stuck to a growing trend at 4.3 pp per annum in the last 5 years.
Investments (CAPEX, working capital and M&A)
In 2018 the company had CAPEX/Revenue of 0.47%. The company's CAPEX/Revenue decreased on 4.7 pp from 5.2% in 2015 to 0.47% in 2018. Average CAPEX/Revenue for the last three years was 0.93%. During the last 5 years CAPEX as a % of Revenue topped in 2015 at 5.2% and was declining since that time.
Return on investment
The company operates at negative ROIC (-17.7%) and ROE (-18.0%). ROIC decreased on 2.1 pp from -15.6% to -17.7% in 2018. ROE decreased on 2.2 pp from -15.8% to -18.0% in 2018. ROIC grew at 6.1 pp per annum in 2014-2018.
Leverage (Debt)
The company has no debt. Cash jumped on 99.3%.
Management team
I.D. Systems, Inc.'s CEO is Chris Wolfe. Chris Wolfe is a founder and has 2 years tenure with the company. Ned Mavrommatis is a I.D. Systems, Inc.'s CFO. Ned Mavrommatis has spent 15 years at the company.
Financial and operational results
FY ended 12/31/2018
I.D. Systems, Inc. ($IDSY) key annual financial indicators| mln. $ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 45.633 | 41.784 | 36.822 | 40.958 | 53.064 | 29.6% |
| Gross Profit | 20.006 | 17.023 | 18.294 | 20.927 | 25.798 | 23.3% |
| SG&A | 25.094 | 22.750 | 20.126 | 21.053 | 24.671 | 17.2% |
| EBITDA | -9.962 | -9.565 | -5.683 | -2.959 | -4.175 | |
| Net Income | -11.575 | -9.952 | -6.370 | -3.870 | -5.812 | |
Balance Sheet
|
|---|
| Cash | 5.974 | 4.489 | 4.972 | 5.097 | 10.159 | 99.3% |
| Short Term Debt | 0.149 | 0.000 | 2.993 | 0.000 | 0.000 | |
| Long Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
Cash flow
|
|---|
| Capex | 0.410 | 2.182 | 0.505 | 0.386 | 0.251 | -35.0% |
Ratios
|
|---|
| Revenue growth | 14.2% | -8.4% | -11.9% | 11.2% | 29.6% | |
| EBITDA growth | 63.9% | -4.0% | -40.6% | -47.9% | 41.1% | |
|
|---|
| Gross Margin | 43.8% | 40.7% | 49.7% | 51.1% | 48.6% | -2.5% |
| EBITDA Margin | -21.8% | -22.9% | -15.4% | -7.2% | -7.9% | -0.6% |
| SG&A, % of revenue | 55.0% | 54.4% | 54.7% | 51.4% | 46.5% | -4.9% |
| Net Income Margin | -25.4% | -23.8% | -17.3% | -9.4% | -11.0% | -1.5% |
| CAPEX, % of revenue | 0.9% | 5.2% | 1.4% | 0.9% | 0.5% | -0.5% |
|
|---|
| ROIC | -36.1% | -40.4% | -30.7% | -15.6% | -17.7% | -2.1% |
| ROE | -35.8% | -41.6% | -34.8% | -15.8% | -18.0% | -2.2% |
I.D. Systems, Inc. ($IDSY) key quoterly financial indicators
| mln. $ | 18Q1 | 18Q2 | 18Q3 | 18Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 13 | 15 | 13 | 11 | | 67.3% | 38.3% | 20.7% | 2.9% |
| EBITDA | -1 | -1 | -0 | -2 | | | | | |
| Net Income | -1 | -1 | -1 | -3 | | | | | |
Balance Sheet
|
|---|
| Cash | 5 | 3 | 12 | 10 | | -31.8% | -59.8% | 107.9% | 99.3% |
| Short Term Debt | 0 | 0 | 0 | 0 | | -100.0% | | | |
| Long Term Debt | 0 | 0 | 0 | 0 | | | | | |
Ratios
|
|---|
| Gross Margin | 48.3% | 43.3% | 50.8% | 53.3% | | -3.6% | -8.4% | 0.0% | 3.1% |
| EBITDA Margin | -4.4% | -4.9% | -3.2% | -21.2% | | 17.0% | -2.4% | -1.4% | -14.1% |
| Net Income Margin | -7.4% | -7.5% | -6.7% | -24.4% | | 16.2% | -2.6% | -1.4% | -16.6% |
Peers in Electronic Equipment & Instrum
Below you can find I.D. Systems, Inc. benchmarking vs. other companies in Electronic Equipment & Instrum 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 |
|---|
| 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. ($MAGS) | | -17.8% | 6.4% | -5.2% | 44.0% |
| |
|---|
| Median (61 companies) | -78.5% | 4.5% | 1.2% | 3.6% | 9.1% |
|---|
| I.D. Systems, Inc. ($IDSY) | | -8.4% | -11.9% | 11.2% | 29.6% |
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 ($APDN) | | | 82.2% | 77.3% | 69.1% |
| |
|---|
| Median (60 companies) | 41.7% | 42.3% | 40.1% | 41.5% | 40.9% |
|---|
| I.D. Systems, Inc. ($IDSY) | 43.8% | 40.7% | 49.7% | 51.1% | 48.6% |
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. ($FLIR) | 20.7% | 22.8% | 21.3% | 20.0% | 21.7% |
| |
|---|
| Median (60 companies) | 5.5% | 5.2% | 3.4% | 5.1% | 4.2% |
|---|
| I.D. Systems, Inc. ($IDSY) | -21.8% | -22.9% | -15.4% | -7.2% | -7.9% |
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 ($APDN) | 8.4% | 3.9% | 16.1% | 3.1% | 6.8% |
| |
|---|
| Median (60 companies) | 1.9% | 1.9% | 2.1% | 1.7% | 2.3% |
|---|
| I.D. Systems, Inc. ($IDSY) | 0.9% | 5.2% | 1.4% | 0.9% | 0.5% |
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 ($CGNX) | 18.3% | 15.6% | 17.7% | 25.6% | 20.1% |
| |
|---|
| Median (72 companies) | 3.3% | 2.3% | 2.2% | 3.3% | 1.3% |
|---|
| I.D. Systems, Inc. ($IDSY) | -36.1% | -40.4% | -30.7% | -15.6% | -17.7% |
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 (36 companies) | -0.8x | -0.9x | -0.8x | -0.7x | -0.9x |
|---|
