LGL Group, Inc. (The) Net Income jumped on 1,101% and Revenue jumped on 11.0%
03/13/2019 • About LGL Group, Inc. (The) (
$LGL) • By InTwits
LGL Group, Inc. (The) reported 2018 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is expanding: 7.7% in 2018 vs. 4.1% in 2017 vs. -6.3% in 2014
- EBITDA Margin is quite volatile: 7.7% in 2018, 4.1% in 2017, 2.9% in 2016, 0.4% in 2015, -6.3% in 2014
- LGL Group, Inc. (The) has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.1%. At the same time it's in pair with industry average of 5.2%
- CAPEX is quite volatile: $0m in 2018, $0m in 2017, $0m in 2016, $0m in 2015, $1m in 2014
- The company has potentially unprofitable business model: ROIC is 5.5%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue surged on 11.0%. Revenue growth showed acceleration in 18Q4 - it increased 13.7% YoY. Revenue decline was slowing down on average by 6.4 pp per annum in 2014-2018. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 14.0 pp from -28.9% to -42.9% in 2018. EBITDA Margin stuck to a growing trend at 3.2 pp per annum in the last 5 years.
Gross Margin increased on 4.3 pp from 34.6% to 38.8% in 2018. Gross Margin grew at 2.4 pp per annum in 2014-2018. SG&A as a % of Revenue showed almost no change in 2018.
Net Income margin increased on 5.1 pp from 0.52% to 5.6% in 2018. Net Income margin grew at 4.0 pp per annum in the last 5 years.
Investments (CAPEX, working capital and M&A)
In 2018 the company had CAPEX/Revenue of 1.3%. The company showed small CAPEX/Revenue decline of 0.73 pp from 2.0% in 2015 to 1.3% in 2018. Average CAPEX/Revenue for the last three years was 1.4%.
Return on investment
The company operates at low ROIC (5.5%) and ROE (5.4%). ROIC increased on 4.0 pp from 1.4% to 5.5% in 2018. ROE increased on 4.8 pp from 0.60% to 5.4% in 2018. ROIC grew at 4.7 pp per annum in the last 5 years. ROE stuck to a growing trend at 5.3 pp per annum in 2014-2018.
Leverage (Debt)
The company has no debt. Cash jumped on 17.0%.
Valuation and dividends
The company's trades at EV/EBITDA 5.7x and P/E 18.8x.
Financial and operational results
FY ended 12/31/2018
LGL Group, Inc. (The) ($LGL) key annual financial indicators| mln. $ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 23.013 | 20.713 | 20.891 | 22.402 | 24.870 | 11.0% |
| Gross Profit | 6.328 | 6.850 | 7.033 | 7.741 | 9.659 | 24.8% |
| SG&A | 8.692 | 5.674 | 7.194 | 7.465 | 8.229 | 10.2% |
| EBITDA | -1.442 | 0.082 | 0.611 | 0.918 | 1.922 | 109.4% |
| Net Income | -2.825 | -0.711 | 0.148 | 0.117 | 1.405 | 1,100.9% |
Balance Sheet
|
|---|
| Cash | 5.192 | 5.553 | 2.778 | 13.250 | 15.508 | 17.0% |
| Short Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
| Long Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
Cash flow
|
|---|
| Capex | 1.011 | 0.422 | 0.467 | 0.131 | 0.324 | 147.3% |
Ratios
|
|---|
| Revenue growth | -12.2% | -10.0% | 0.9% | 7.2% | 11.0% | |
| EBITDA growth | -36.7% | -105.7% | 645.1% | 50.2% | 109.4% | |
|
|---|
| Gross Margin | 27.5% | 33.1% | 33.7% | 34.6% | 38.8% | 4.3% |
| EBITDA Margin | -6.3% | 0.4% | 2.9% | 4.1% | 7.7% | 3.6% |
| SG&A, % of revenue | 37.8% | 27.4% | 34.4% | 33.3% | 33.1% | -0.2% |
| Net Income Margin | -12.3% | -3.4% | 0.7% | 0.5% | 5.6% | 5.1% |
| CAPEX, % of revenue | 4.4% | 2.0% | 2.2% | 0.6% | 1.3% | 0.7% |
|
|---|
| ROIC | -14.7% | -5.6% | -1.2% | 1.4% | 5.5% | 4.0% |
| ROE | -18.2% | -5.1% | 1.1% | 0.6% | 5.4% | 4.8% |
| Net Debt/EBITDA | | -67.7x | -4.5x | -14.4x | -8.1x | 6.4x |
LGL Group, Inc. (The) ($LGL) key quoterly financial indicators
| mln. $ | 18Q1 | 18Q2 | 18Q3 | 18Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 6 | 6 | 6 | 6 | | 5.7% | 5.1% | 20.4% | 13.7% |
| EBITDA | 0 | 1 | 1 | 0 | | -5.1% | 180.0% | 279.1% | 74.3% |
| Net Income | 0 | 0 | 0 | 0 | | 73.9% | 2,260.0% | 2,711.8% | |
Balance Sheet
|
|---|
| Cash | 1 | 2 | 2 | 16 | | -25.4% | -27.5% | 20.7% | 17.0% |
| Short Term Debt | 0 | 0 | 0 | 0 | | | | | |
| Long Term Debt | 0 | 0 | 0 | 0 | | | | | |
Ratios
|
|---|
| Gross Margin | 37.5% | 41.6% | 39.5% | 36.7% | | 0.8% | 9.8% | 6.3% | 0.3% |
| EBITDA Margin | 4.7% | 10.0% | 9.5% | 6.6% | | -0.5% | 6.2% | 6.4% | 2.3% |
| Net Income Margin | 3.2% | 7.7% | 7.5% | 4.1% | | 1.3% | 7.3% | 7.2% | 4.6% |
Peers in Electronic Components
Below we provide LGL Group, Inc. (The) benchmarking against other companies in Electronic Components 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 |
|---|
| Superconductor Technologies Inc. ($SCON) | | -61.4% | -46.3% | 240.5% | 248.9% |
| Akoustis Technologies, Inc. ($AKTS) | | | | | 148.3% |
| CPS Technologies Corp. ($CPSH) | | -5.9% | -29.5% | -5.0% | 48.0% |
| Littelfuse, Inc. ($LFUS) | | 1.9% | 21.7% | 15.7% | 40.7% |
| Cavitation Technologies Inc ($CVAT) | | -73.6% | 267.5% | -40.9% | 22.6% |
| |
|---|
| Median (22 companies) | | 0.0% | 2.1% | 8.3% | 16.6% |
|---|
| LGL Group, Inc. (The) ($LGL) | | -10.0% | 0.9% | 7.2% | 11.0% |
Top companies by Gross margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Cavitation Technologies Inc ($CVAT) | 93.5% | 85.0% | 93.2% | 93.5% | 90.6% |
| Dolby Laboratories ($DLB) | 92.7% | 90.2% | 89.4% | 89.1% | 87.9% |
| Flexpoint Sensor Systems Inc ($FLXT) | 96.7% | 95.2% | 92.7% | 87.9% | 86.1% |
| Airgain, Inc. ($AIRG) | 44.6% | 41.9% | 44.4% | 47.1% | 43.7% |
| II-VI Incorporated ($IIVI) | 33.2% | 36.6% | 37.8% | 40.0% | 39.8% |
| |
|---|
| Median (22 companies) | 33.2% | 36.7% | 33.7% | 38.3% | 36.3% |
|---|
| LGL Group, Inc. (The) ($LGL) | 27.5% | 33.1% | 33.7% | 34.6% | 38.8% |
Top companies by EBITDA margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Corning Incorporated ($GLW) | 32.2% | 27.5% | 27.9% | 27.3% | 25.4% |
| Dolby Laboratories ($DLB) | 34.1% | 29.1% | 30.9% | 30.8% | 25.1% |
| Amphenol Corporation ($APH) | 22.5% | 22.9% | 22.6% | 23.6% | 24.2% |
| Vishay Intertechnology, Inc. ($VSH) | 14.8% | 11.9% | 15.4% | 18.7% | 21.3% |
| IEH Corp ($IEHC) | 18.4% | 21.2% | 18.0% | 16.3% | 20.2% |
| |
|---|
| Median (22 companies) | 9.4% | 12.2% | 14.1% | 11.4% | 12.7% |
|---|
| LGL Group, Inc. (The) ($LGL) | -6.3% | 0.4% | 2.9% | 4.1% | 7.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Akoustis Technologies, Inc. ($AKTS) | | | | 334.0% | 574.7% |
| CBAK Energy Technology, Inc. ($CBAK) | 8.0% | 92.4% | 57.2% | 20.6% | 30.1% |
| Corning Incorporated ($GLW) | 11.1% | 13.7% | 12.0% | 17.8% | 19.9% |
| II-VI Incorporated ($IIVI) | 4.3% | 7.1% | 7.0% | 14.3% | 13.2% |
| Superconductor Technologies Inc. ($SCON) | 586.1% | 57.8% | 0.0% | 34.1% | 12.1% |
| |
|---|
| Median (22 companies) | 3.9% | 3.1% | 3.4% | 5.1% | 4.1% |
|---|
| LGL Group, Inc. (The) ($LGL) | 4.4% | 2.0% | 2.2% | 0.6% | 1.3% |
Top companies by ROIC, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Vishay Intertechnology, Inc. ($VSH) | 8.3% | 4.5% | 9.8% | 18.4% | 27.8% |
| IEH Corp ($IEHC) | 27.7% | 28.2% | 24.2% | 19.2% | 26.1% |
| Amphenol Corporation ($APH) | 19.1% | 18.5% | 18.3% | 19.2% | 21.1% |
| Inrad Optics Inc ($INRD) | -26.7% | -5.2% | -9.2% | -10.4% | 17.7% |
| Littelfuse, Inc. ($LFUS) | 14.3% | 11.1% | 11.7% | 15.8% | 12.1% |
| |
|---|
| Median (22 companies) | 6.9% | 6.1% | 6.4% | 7.0% | 8.4% |
|---|
| LGL Group, Inc. (The) ($LGL) | -14.7% | -5.6% | -1.2% | 1.4% | 5.5% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Belden Inc ($BDC) | 3.9x | 5.2x | 2.1x | 2.6x | 2.3x |
| Inrad Optics Inc ($INRD) | | 9.9x | | | 1.4x |
| Corning Incorporated ($GLW) | -0.7x | -0.0x | -0.5x | 0.3x | 1.3x |
| Bel Fuse Inc. ($BELFA) | 4.6x | 2.0x | | 1.4x | 1.3x |
| Amphenol Corporation ($APH) | 1.4x | 0.8x | 1.4x | 1.1x | 1.2x |
| |
|---|
| Median (14 companies) | -0.6x | -0.1x | -0.4x | -0.0x | 0.7x |
|---|
| LGL Group, Inc. (The) ($LGL) | | -67.7x | -4.5x | -14.4x | -8.1x |
