SITO Mobile, Ltd. revenue started to decline in 2018: decreased 7.5% vs. 48.0% growth a year earliner
03/29/2019 • About SITO Mobile, Ltd. (
$SITO) • By InTwits
SITO Mobile, Ltd. 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: -42.9%
- SITO Mobile, Ltd. motivates its personel by high Stock Based Compensation (SBC): average SBC/Revenue for 2014-2018 was 0.0% while average EBITDA Margin was -25.3% for the sames years
- SITO Mobile, Ltd. has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.9%.
- The company has unprofitable business model: ROIC is -158.4%
- It operates with high leverage: Net Debt/EBITDA is 12.4x 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 decreased on 7.5%. Revenue decline showed acceleration in 18Q4 - it was 23.2% YoY. During the last 5 years Revenue growth topped in 2016 at 83.8% and was decelerating since that time. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin dropped on 14.0 pp from -28.9% to -42.9% in 2018. During the last 5 years EBITDA Margin topped in 2016 at -1.8% and was declining since that time.
Gross Margin decreased slightly on 2.0 pp from 48.3% to 46.3% in 2018. Gross Margin declined at -4.6 pp per annum in 2014-2018. SG&A as a % of Revenue jumped on 20.1 pp from 71.1% to 91.1% in 2018.
Net Income margin decreased on 8.0 pp from -35.0% to -42.9% in 2018. During the last 5 years Net Income margin topped in 2016 at -4.8% and was declining since that time.
Investments (CAPEX, working capital and M&A)
SITO Mobile, Ltd.'s CAPEX/Revenue was 0.10% in 2018. CAPEX/Revenue decreased on 3.0 pp from 3.1% in 2015 to 0.10% in 2018. For the last three years the average CAPEX/Revenue was 0.27%.
Return on investment
The company operates at negative ROIC (-158.4%) and ROE (-152.8%). ROIC dropped on 73.8 pp from -84.6% to -158% in 2018. ROE dropped on 38.4 pp from -114% to -153% in 2018. During 2014-2018 ROIC topped in 2016 at -9.2% and was declining since that time. During the last 5 years ROE topped in 2016 at -12.5% and was declining since that time.
Leverage (Debt)
Debt level is 12.4x Net Debt / EBITDA and Debt / EBITDA. Debt surged on 307% while cash dropped on 28.1%.
SITO Mobile, Ltd. has no short term refinancing risk: cash is higher than short term debt (72,731.6%).
Management team
The company's CEO is Thomas J Pallack "Tom". Thomas J Pallack "Tom" is a founder and has 2 years tenure with the company.
Financial and operational results
FY ended 12/31/2018
SITO Mobile, Ltd. ($SITO) key annual financial indicators| mln. $ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 9.872 | 15.809 | 29.052 | 42.990 | 39.746 | -7.5% |
| Gross Profit | 6.282 | 9.452 | 15.346 | 20.748 | 18.402 | -11.3% |
| SG&A | | 10.955 | 16.545 | 30.551 | 36.223 | 18.6% |
| EBITDA | -3.032 | -1.698 | -0.536 | -12.414 | -17.058 | |
| Net Income | -4.511 | -4.528 | -1.404 | -15.039 | -17.066 | |
Balance Sheet
|
|---|
| Cash | 0.620 | 2.004 | 8.745 | 3.611 | 2.597 | -28.1% |
| Short Term Debt | 4.308 | 3.591 | 2.900 | 0.003 | 0.004 | 29.6% |
| Long Term Debt | 0.013 | 5.697 | 3.956 | 0.000 | 0.008 | |
Cash flow
|
|---|
| Capex | 0.072 | 0.495 | 0.052 | 0.224 | 0.041 | -81.7% |
Ratios
|
|---|
| Revenue growth | 26.8% | 60.2% | 83.8% | 48.0% | -7.5% | |
| EBITDA growth | -8.6% | -44.0% | -68.4% | 2,215.8% | 37.4% | |
|
|---|
| Gross Margin | 63.6% | 59.8% | 52.8% | 48.3% | 46.3% | -2.0% |
| EBITDA Margin | -30.7% | -10.7% | -1.8% | -28.9% | -42.9% | -14.0% |
| SG&A, % of revenue | | 69.3% | 56.9% | 71.1% | 91.1% | 20.1% |
| Net Income Margin | -45.7% | -28.6% | -4.8% | -35.0% | -42.9% | -8.0% |
| CAPEX, % of revenue | 0.7% | 3.1% | 0.2% | 0.5% | 0.1% | -0.4% |
|
|---|
| ROIC | -63.3% | -25.7% | -9.2% | -84.6% | -158.4% | -73.8% |
| ROE | -238.6% | -113.6% | -12.5% | -114.4% | -152.8% | -38.4% |
SITO Mobile, Ltd. ($SITO) key quoterly financial indicators
| mln. $ | 18Q1 | 18Q2 | 18Q3 | 18Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 11 | 8 | 9 | 11 | | 70.1% | -21.6% | -17.6% | -23.2% |
| EBITDA | -6 | -6 | -5 | -1 | | | | | |
| Net Income | -5 | -6 | -5 | -1 | | | | | |
Balance Sheet
|
|---|
| Cash | 12 | 7 | 5 | 3 | | 71.7% | 108.8% | 79.0% | -28.1% |
| Short Term Debt | 0 | 0 | 0 | 0 | | -99.9% | -99.9% | -2.4% | 29.6% |
| Long Term Debt | 0 | 0 | 0 | 0 | | 457.1% | 908.2% | | |
Ratios
|
|---|
| Gross Margin | 39.9% | 47.8% | 47.9% | 50.3% | | -8.3% | 0.1% | -3.5% | 6.0% |
| EBITDA Margin | -49.8% | -69.3% | -54.1% | -6.9% | | -12.7% | -45.0% | -44.9% | 37.9% |
| Net Income Margin | -47.1% | -68.1% | -55.3% | -9.7% | | -0.4% | -47.9% | -27.3% | 30.6% |
Peers in Application Software
Below you can find SITO Mobile, Ltd. 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 ($INS) | | 14.2% | 71.0% | 12.2% | 119.0% |
| |
|---|
| Median (151 companies) | -43.3% | 13.5% | 13.6% | 14.8% | 15.2% |
|---|
| SITO Mobile, Ltd. ($SITO) | | 60.2% | 83.8% | 48.0% | -7.5% |
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. ($AZPN) | 86.5% | 88.7% | 89.7% | 90.2% | 89.9% |
| |
|---|
| Median (150 companies) | 62.8% | 61.9% | 64.2% | 64.6% | 66.1% |
|---|
| SITO Mobile, Ltd. ($SITO) | 63.6% | 59.8% | 52.8% | 48.3% | 46.3% |
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. ($ADBE) | 17.5% | 25.9% | 31.2% | 34.2% | 35.3% |
| |
|---|
| Median (152 companies) | -10.1% | -9.4% | -5.3% | -3.3% | -3.2% |
|---|
| SITO Mobile, Ltd. ($SITO) | -30.7% | -10.7% | -1.8% | -28.9% | -42.9% |
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. ($ELLI) | 12.3% | 20.6% | 16.7% | 21.1% | 19.4% |
| |
|---|
| Median (153 companies) | 2.8% | 2.7% | 3.0% | 2.3% | 2.4% |
|---|
| SITO Mobile, Ltd. ($SITO) | 0.7% | 3.1% | 0.2% | 0.5% | 0.1% |
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. ($PAYC) | 16.7% | 30.5% | 75.4% | 51.1% | 47.5% |
| |
|---|
| Median (179 companies) | -14.2% | -11.2% | -9.8% | -10.2% | -9.3% |
|---|
| SITO Mobile, Ltd. ($SITO) | -63.3% | -25.7% | -9.2% | -84.6% | -158.4% |
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 |
|---|
