ADDvantage Technologies Group, Inc. revenue decreased on 9.0% and EBITDA Margin dropped on 24.3 pp from -4.6% to -28.9%
12/16/2020 • About ADDvantage Technologies Group, Inc. (
$AEY) • By InTwits
ADDvantage Technologies Group, Inc. reported FY2020 financial results today. Overall the company's long term financial model is characterised by the following facts:
- The company operates at negative EBITDA Margin: -28.9%
- ADDvantage Technologies Group, Inc. motivates its personel by high Stock Based Compensation (SBC): average SBC/Revenue for FY2016-FY2020 was 0.0% while average EBITDA Margin was -7.1% for the sames years
- ADDvantage Technologies Group, Inc. has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.8%.
- The company has unprofitable business model: ROIC is -63.8%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
ADDvantage Technologies Group, Inc.'s Revenue decreased on 9.0%. Revenue decline showed acceleration in FY20Q4 - it was 31.5% YoY. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin dropped on 24.3 pp from -4.6% to -28.9% in FY2020. EBITDA Margin declined at -7.4 pp per annum in the last 5 years.
Gross Margin increased on 6.8 pp from 16.5% to 23.3% in FY2020. During FY2016-FY2020 Gross Margin bottomed in FY2019 at 16.5%. SG&A as a % of Revenue decreased slightly on 1.3 pp from 23.7% to 22.4% in FY2020. SG&A as a % of Revenue declined at -2.4 pp per annum in the last 5 years.
Net Income margin dropped on 24.9 pp from -9.6% to -34.5% in FY2020. Net Income margin followed a declining trend at -8.0 pp per annum in FY2016-FY2020.
Investments (CAPEX, working capital and M&A)
The company's CAPEX/Revenue was 1.2% in FY2020. The company's CAPEX/Revenue increased slightly on 0.82 pp from 0.39% in FY2017 to 1.2% in FY2020. It's average CAPEX/Revenue for the last three years was 0.86%. During the last 5 years CAPEX as a % of Revenue bottomed in FY2018 at 0.27% and was growing since that time.
Return on investment
The company operates at negative ROIC (-63.8%) and ROE (-78.1%). ROIC dropped on 51.8 pp from -12.0% to -63.8% in FY2020. ROE dropped on 61.5 pp from -16.6% to -78.1% in FY2020.
Leverage (Debt)
Debt level is -7.1x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA didn't change in FY2020. Debt surged while cash jumped on 565%.
ADDvantage Technologies Group, Inc. has no short term refinancing risk: cash is higher than short term debt (136.2%).
Financial and operational results
FY ended 09/30/2020
ADDvantage Technologies Group, Inc. ($AEY) key annual financial indicators| mln. $ | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 38.663 | 48.714 | 47.414 | 55.118 | 50.182 | -9.0% |
| Gross Profit | 12.441 | 14.811 | 11.223 | 9.093 | 11.680 | 28.5% |
| SG&A | 12.097 | 14.665 | 14.325 | 13.069 | 11.249 | -13.9% |
| EBITDA | 1.592 | 1.860 | -3.562 | -2.523 | -14.504 | |
| Net Income | 0.294 | -0.098 | -7.320 | -5.302 | -17.333 | |
Balance Sheet
|
|---|
| Cash | 4.508 | 3.973 | 3.129 | 1.242 | 8.265 | 565.4% |
| Short Term Debt | 0.900 | 4.190 | 2.594 | 0.000 | 6.069 | |
| Long Term Debt | 3.466 | 2.094 | 0.000 | 0.000 | 6.541 | |
Cash flow
|
|---|
| Capex | 0.318 | 0.190 | 0.127 | 0.602 | 0.608 | 1.1% |
Ratios
|
|---|
| Revenue growth | -11.6% | 26.0% | -2.7% | 16.2% | -9.0% | |
| EBITDA growth | -58.2% | 16.8% | -291.5% | -29.2% | 474.8% | |
|
|---|
| Gross Margin | 32.2% | 30.4% | 23.7% | 16.5% | 23.3% | 6.8% |
| EBITDA Margin | 4.1% | 3.8% | -7.5% | -4.6% | -28.9% | -24.3% |
| SG&A, % of revenue | 31.3% | 30.1% | 30.2% | 23.7% | 22.4% | -1.3% |
| Net Income Margin | 0.8% | -0.2% | -15.4% | -9.6% | -34.5% | -24.9% |
| CAPEX, % of revenue | 0.8% | 0.4% | 0.3% | 1.1% | 1.2% | 0.1% |
|
|---|
| ROIC | 0.8% | 0.3% | -12.4% | -12.0% | -63.8% | -51.8% |
| ROE | 0.7% | -0.2% | -19.2% | -16.6% | -78.1% | -61.5% |
| Net Debt/EBITDA | -0.1x | 1.2x | | | |
ADDvantage Technologies Group, Inc. ($AEY) key quoterly financial indicators
| mln. $ | FY20Q1 | FY20Q2 | FY20Q3 | FY20Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 14 | 12 | 12 | 12 | | 105.0% | -7.2% | -31.5% | -31.5% |
| EBITDA | -1 | -13 | -0 | -0 | | - | - | -124.0% | - |
| Net Income | -2 | -15 | 0 | -1 | | - | - | - | - |
Balance Sheet
|
|---|
| Cash | 1 | 4 | 10 | 8 | | -78.1% | 203.0% | 287.8% | 565.4% |
| Short Term Debt | 3 | 6 | 7 | 6 | | - | 737.4% | 824.5% | - |
| Long Term Debt | 4 | 7 | 7 | 7 | | - | - | - | - |
Ratios
|
|---|
| Gross Margin | 25.7% | -3.7% | 34.7% | 35.6% | | 0.4% | -30.6% | 8.6% | 25.6% |
| EBITDA Margin | -7.3% | -110.8% | -0.3% | -0.9% | | 3.1% | -103.3% | -1.0% | 6.0% |
| Net Income Margin | -12.3% | -122.6% | 0.2% | -8.0% | | 3.0% | -113.2% | 8.7% | 0.8% |
Peers in Technology Distributors
Below you can find ADDvantage Technologies Group, Inc. benchmarking vs. other companies in Technology Distributors 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 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Galaxy Next Generation Inc ($GAXY) | - | 3.7% | - | - | 23.3% |
| Wayside Technology Group, Inc. ($WSTG) | - | -61.6% | 13.0% | 15.1% | 20.5% |
| Insight Enterprises, Inc. ($NSIT) | - | 22.2% | 5.6% | 9.2% | 7.9% |
| Synnex Corporation ($SNX) | - | 21.2% | 17.6% | 18.5% | 3.9% |
| CDW Corporation ($CDW) | - | 6.1% | 9.5% | 11.0% | 2.4% |
| |
|---|
| Median (8 companies) | 5.3% | 4.2% | 8.9% | 11.0% | 3.1% |
|---|
| ADDvantage Technologies Group, Inc. ($AEY) | - | 26.0% | -2.7% | 16.2% | -9.0% |
Top companies by Gross margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Galaxy Next Generation Inc ($GAXY) | 70.0% | 61.4% | - | 6.1% | 51.0% |
| EACO Corp ($EACO) | 29.3% | 28.5% | 28.5% | 27.7% | 27.2% |
| CDW Corporation ($CDW) | 16.6% | 16.5% | 16.7% | 16.9% | 17.4% |
| PC Connection, Inc. ($CNXN) | 13.8% | 13.1% | 15.2% | 16.0% | 16.2% |
| Insight Enterprises, Inc. ($NSIT) | 13.5% | 13.7% | 14.0% | 14.7% | 15.6% |
| |
|---|
| Median (8 companies) | 13.8% | 16.5% | 15.6% | 14.5% | 15.9% |
|---|
| ADDvantage Technologies Group, Inc. ($AEY) | 32.2% | 30.4% | 23.7% | 16.5% | 23.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| CDW Corporation ($CDW) | 7.7% | 7.6% | 7.7% | 8.3% | 9.0% |
| EACO Corp ($EACO) | 4.7% | 4.5% | 5.9% | 6.4% | 6.6% |
| Synnex Corporation ($SNX) | 3.6% | 3.9% | 3.9% | 5.0% | 5.7% |
| Insight Enterprises, Inc. ($NSIT) | 3.4% | 3.3% | 4.1% | 4.0% | 4.4% |
| Arrow Electronics, Inc. ($ARW) | 4.4% | 4.1% | 4.5% | 1.4% | 4.1% |
| |
|---|
| Median (8 companies) | 3.4% | 3.5% | 4.1% | 4.6% | 4.2% |
|---|
| ADDvantage Technologies Group, Inc. ($AEY) | 4.1% | 3.8% | -7.5% | -4.6% | -28.9% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| EACO Corp ($EACO) | 0.3% | 5.5% | 0.8% | 0.8% | 3.0% |
| CDW Corporation ($CDW) | 0.5% | 0.5% | 0.5% | 1.3% | 0.9% |
| Synnex Corporation ($SNX) | 0.9% | 0.6% | 0.6% | 0.6% | 0.8% |
| Galaxy Next Generation Inc ($GAXY) | 0.0% | 15.1% | - | 0.0% | 0.8% |
| Arrow Electronics, Inc. ($ARW) | 0.7% | 0.8% | 0.5% | 0.5% | 0.4% |
| |
|---|
| Median (8 companies) | 0.4% | 0.5% | 0.5% | 0.7% | 0.6% |
|---|
| ADDvantage Technologies Group, Inc. ($AEY) | 0.8% | 0.4% | 0.3% | 1.1% | 1.2% |
Top companies by ROIC, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| CDW Corporation ($CDW) | 18.8% | 20.1% | 23.1% | 26.0% | 23.5% |
| EACO Corp ($EACO) | 22.2% | 16.1% | 21.2% | 23.0% | 14.6% |
| Insight Enterprises, Inc. ($NSIT) | 20.7% | 19.3% | 20.0% | 14.7% | 13.7% |
| Synnex Corporation ($SNX) | 13.5% | 13.7% | 9.6% | 11.6% | 11.7% |
| Arrow Electronics, Inc. ($ARW) | 12.5% | 12.1% | 13.3% | 1.4% | 11.3% |
| |
|---|
| Median (8 companies) | 12.5% | 11.5% | 11.8% | 19.0% | 11.7% |
|---|
| ADDvantage Technologies Group, Inc. ($AEY) | 0.8% | 0.3% | -12.4% | -12.0% | -63.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Arrow Electronics, Inc. ($ARW) | 2.2x | 2.3x | 2.2x | 7.5x | 1.9x |
| CDW Corporation ($CDW) | 2.8x | 2.7x | 2.4x | 2.2x | 1.6x |
| Synnex Corporation ($SNX) | 1.2x | 2.1x | 3.9x | 2.4x | 1.3x |
| Insight Enterprises, Inc. ($NSIT) | -0.9x | 0.9x | 0.2x | 2.7x | 1.1x |
| EACO Corp ($EACO) | -0.7x | 1.2x | 0.5x | 0.5x | 1.0x |
| |
|---|
| Median (7 companies) | 0.7x | 0.9x | 0.9x | 2.2x | 1.1x |
|---|
