Blackbaud, Inc. CAPEX surged on 23.1% and Revenue increased slightly on 1.4%
02/08/2021 • About Blackbaud, Inc. (
$BLKB) • By InTwits
Blackbaud, Inc. reported 2020 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Blackbaud, Inc. has low CAPEX intensity: 5 year average CAPEX/Revenue was 4.0%. At the same time it's in pair with industry average of 3.7%
- CAPEX is quite volatile: $72m in 2020, $58m in 2019, $15m in 2018, $10m in 2017, $18m in 2016
- In the last 5 years the company invested considerably less than D&A: $173m vs. $224m
- The company has potentially unprofitable business model: ROIC is 4.2%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Blackbaud, Inc.'s Revenue increased slightly on 1.4%. Revenue growth showed acceleration in 20Q4 - it increased 2.0% YoY. Revenue decline was accelerating on average at -2.8 pp per annum in 2016-2020. Revenue growth happened at the same time with EBITDA margin expansion. EBITDA Margin increased on 3.2 pp from 15.2% to 18.4% in 2020. During 2016-2020 EBITDA Margin bottomed in 2019 at 15.2%.
Gross Margin showed almost no change in 2020. During the last 5 years Gross Margin topped in 2018 at 55.0% and was declining since that time. SG&A as a % of Revenue showed almost no change in 2020. SG&A as a % of Revenue stuck to a growing trend at 1.6 pp per annum in 2016-2020.
Net Income margin showed almost no change in 2020. During 2016-2020 Net Income margin topped in 2017 at 9.3% and was declining since that time.
Investments (CAPEX, working capital and M&A)
The company's CAPEX/Revenue was 7.9% in 2020. The company showed CAPEX/Revenue growth of 6.6 pp from 1.3% in 2017 to 7.9% in 2020. It's average level of CAPEX/Revenue for the last three years was 5.4%. During the last 5 years CAPEX as a % of Revenue bottomed in 2017 at 1.3% and was growing since that time.
Return on investment
The company operates at low ROIC (4.2%) and ROE (1.9%). ROIC showed almost no change in 2020. ROE decreased slightly on 1.2 pp from 3.1% to 1.9% in 2020. ROIC stuck to a declining trend at -2.0 pp per annum in the last 5 years. ROE stuck to a declining trend at -5.8 pp per annum in the last 5 years.
Leverage (Debt)
Company's Net Debt / EBITDA is 3.1x and Debt / EBITDA is 3.3x. Net Debt / EBITDA dropped on 0.9x from 4.0x to 3.1x in 2020. Debt decreased on 4.3% while cash surged on 12.4%.
Blackbaud, Inc. has no short term refinancing risk: cash is higher than short term debt (161.0%).
Valuation and dividends
The company's trades at EV/EBITDA 24.2x and P/E 459.5x.
Management team
Blackbaud, Inc.'s CEO Michael P Gianoni "Mike" has spent 7 years with the company. The company's CFO Anthony W Boor "Tony" has spent 9 years with the company.
Financial and operational results
FY ended 12/31/2020
Blackbaud, Inc. ($BLKB) key annual financial indicators| mln. $ | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 731.6 | 788.5 | 848.6 | 900.4 | 913.2 | 1.4% |
| Gross Profit | 392.4 | 426.6 | 466.9 | 482.0 | 485.2 | 0.7% |
| SG&A | 231.5 | 264.4 | 299.2 | 337.6 | 344.6 | 2.1% |
| EBITDA | 138.7 | 142.1 | 139.0 | 137.2 | 168.1 | 22.5% |
| EBIT | 68.2 | 68.2 | 59.4 | | | |
| Interest expence | 10.6 | 12.1 | 15.9 | | | |
| Tax | 11.9 | -15.3 | -0.2 | | | |
| Net Income | 45.4 | 73.6 | 44.8 | 11.9 | 7.7 | -35.2% |
| Stock Based Compensation | 32.6 | 40.6 | 48.3 | | | |
Balance Sheet
|
|---|
| Cash | 16.9 | 29.8 | 30.9 | 31.8 | 35.8 | 12.4% |
| Accounts Receivable | 88.9 | 95.7 | 86.6 | | | |
| Accounts Payable | 23.3 | 24.7 | 34.5 | | | |
| Short Term Debt | 4.4 | 8.6 | 7.5 | 27.3 | 22.2 | -18.6% |
| Long Term Debt | 338.0 | 429.6 | 379.6 | 555.2 | 535.6 | -3.5% |
Cash flow
|
|---|
| Capex | 17.7 | 10.2 | 14.7 | 58.4 | 71.8 | 23.1% |
| Dividends | 23.0 | 23.0 | 23.0 | | | |
| Acquisitions | 3.4 | 146.8 | 44.9 | | | |
Ratios
|
|---|
| Revenue growth | 14.7% | 7.8% | 7.6% | 6.1% | 1.4% | |
| EBITDA growth | 35.1% | 2.5% | -2.2% | -1.3% | 22.5% | |
|
|---|
| Gross Margin | 53.6% | 54.1% | 55.0% | 53.5% | 53.1% | -0.4% |
| EBITDA Margin | 19.0% | 18.0% | 16.4% | 15.2% | 18.4% | 3.2% |
| EBIT Margin | 9.3% | 8.6% | 7.0% | | |
| SG&A, % of revenue | 31.6% | 33.5% | 35.3% | 37.5% | 37.7% | 0.2% |
| SBC, % of revenue | 4.5% | 5.2% | 5.7% | | |
| Net Income Margin | 6.2% | 9.3% | 5.3% | 1.3% | 0.8% | -0.5% |
| CAPEX, % of revenue | 2.4% | 1.3% | 1.7% | 6.5% | 7.9% | 1.4% |
|
|---|
| ROIC | 11.2% | 9.9% | 7.7% | 3.9% | 4.2% | 0.3% |
| ROE | 19.8% | 25.2% | 12.6% | 3.1% | 1.9% | -1.2% |
| Net Debt/EBITDA | 2.3x | 2.9x | 2.6x | 4.0x | 3.1x | -0.9x |
| Interest coverage ratio (ICR) | 6.4x | 5.6x | 3.7x | | |
| Interest expence / Average debt | 3.1% | 3.1% | 3.9% | | | |
People
|
|---|
| Insider ownership | 1.7% | 1.7% | 1.7% | | | |
| Employees | 3,156 | 3,182 | 3,353 | | | |
| Revenue/Employee, th. $ | 232 | 248 | 253 | | | |
Blackbaud, Inc. ($BLKB) key quoterly financial indicators
| mln. $ | 20Q1 | 20Q2 | 20Q3 | 20Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 224 | 232 | 215 | 243 | | 3.6% | 2.8% | -2.8% | 2.0% |
| EBITDA | 36 | 49 | 44 | 23 | | 22.0% | 23.0% | 27.0% | -30.3% |
| Net Income | 5 | 12 | 5 | -14 | | - | 65.6% | 6.8% | -1,128.8% |
Balance Sheet
|
|---|
| Cash | 25 | 31 | 31 | 36 | | -0.9% | -6.5% | 5.1% | 12.4% |
| Short Term Debt | 30 | 29 | 27 | 22 | | 23.8% | 20.5% | 0.1% | -18.6% |
| Long Term Debt | 612 | 566 | 524 | 536 | | -9.9% | -13.5% | -12.1% | -3.5% |
Ratios
|
|---|
| Gross Margin | 53.1% | 54.8% | 54.1% | 50.7% | | -0.9% | -0.6% | 0.1% | -0.3% |
| EBITDA Margin | 15.9% | 21.2% | 20.5% | 9.5% | | 2.4% | 3.5% | 4.8% | -4.4% |
| Net Income Margin | 2.1% | 5.1% | 2.3% | -5.6% | | 2.6% | 1.9% | 0.2% | -6.2% |
Peers in Application Software
Below you can find Blackbaud, Inc. 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 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| VirnetX Holding Corp ($VHC) | - | -0.2% | -95.9% | 34.9% | 355,942.4% |
| AudioEye, Inc. ($AEYE) | - | 175.5% | 106.6% | 90.2% | 90.2% |
| Cloudera, Inc. ($CLDR) | - | 57.2% | 42.6% | 28.9% | 65.5% |
| Integrated Ventures Inc ($INTV) | - | - | - | -8.9% | 62.7% |
| Smartsheet Inc. ($SMAR) | - | 64.3% | 66.1% | 59.7% | 52.4% |
| |
|---|
| Median (92 companies) | 12.0% | 15.7% | 15.2% | 19.5% | 14.7% |
|---|
| Blackbaud, Inc. ($BLKB) | - | 7.8% | 7.6% | 6.1% | 1.4% |
Top companies by Gross margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Aware, Inc. ($AWRE) | 90.3% | 94.6% | 92.3% | 89.7% | 92.8% |
| Alteryx, Inc. ($AYX) | 81.3% | 83.4% | 91.0% | 90.6% | 91.1% |
| Autodesk, Inc. ($ADSK) | 85.2% | 83.2% | 85.2% | 88.9% | 90.1% |
| Smith Micro Software, Inc. ($SMSI) | 73.2% | 77.9% | 83.5% | 90.9% | 89.9% |
| Cadence Design Systems, Inc. ($CDNS) | 85.9% | 87.8% | 87.9% | 88.6% | 88.6% |
| |
|---|
| Median (89 companies) | 64.2% | 64.6% | 66.0% | 68.4% | 70.6% |
|---|
| Blackbaud, Inc. ($BLKB) | 53.6% | 54.1% | 55.0% | 53.5% | 53.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| VirnetX Holding Corp ($VHC) | -1,837.2% | -1,118.0% | -40,379.4% | -23,127.1% | 52.2% |
| j2 Global, Inc. ($JCOM) | 41.7% | 36.5% | 35.7% | 38.6% | 40.5% |
| Intelligent Systems Corporation ($INS) | -5.4% | -12.8% | 33.6% | 43.6% | 40.4% |
| Adobe Inc. ($ADBE) | 31.2% | 34.2% | 35.3% | 35.8% | 39.7% |
| SS&C Technologies Holdings, Inc. ($SSNC) | 34.9% | 37.9% | 27.7% | 38.2% | 38.3% |
| |
|---|
| Median (89 companies) | -5.3% | -4.2% | -3.3% | 2.7% | 6.8% |
|---|
| Blackbaud, Inc. ($BLKB) | 19.0% | 18.0% | 16.4% | 15.2% | 18.4% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| MicroStrategy Incorporated ($MSTR) | 0.5% | 0.8% | 1.4% | 2.1% | 234.8% |
| Integrated Ventures Inc ($INTV) | - | - | 199.9% | 15.2% | 27.2% |
| Intelligent Systems Corporation ($INS) | 3.8% | 9.7% | 4.3% | 4.9% | 19.2% |
| LivePerson, Inc. ($LPSN) | 5.5% | 7.9% | 8.8% | 16.3% | 11.4% |
| PROS Holdings, Inc. ($PRO) | 4.7% | 0.8% | 0.7% | 2.1% | 11.3% |
| |
|---|
| Median (87 companies) | 3.0% | 2.3% | 2.4% | 2.9% | 2.5% |
|---|
| Blackbaud, Inc. ($BLKB) | 2.4% | 1.3% | 1.7% | 6.5% | 7.9% |
Top companies by ROIC, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| VirnetX Holding Corp ($VHC) | -210.9% | -256.8% | -416.3% | -247.2% | 137.3% |
| Manhattan Associates, Inc. ($MANH) | 99.3% | 102.5% | 80.9% | 71.7% | 53.4% |
| Citrix Systems, Inc. ($CTXS) | 16.1% | 16.7% | 25.2% | 29.8% | 33.5% |
| Sonic Foundry, Inc. ($SOFO) | -18.1% | -50.6% | -786.4% | - | 31.3% |
| Paycom Software, Inc. ($PAYC) | 75.4% | 51.1% | 47.5% | 47.5% | 28.7% |
| |
|---|
| Median (92 companies) | -9.8% | -11.8% | -10.6% | -4.5% | -2.2% |
|---|
| Blackbaud, Inc. ($BLKB) | 11.2% | 9.9% | 7.7% | 3.9% | 4.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Dropbox, Inc. ($DBX) | - | -3.8x | - | 2.4x | 1,341.0x |
| Avaya Holdings Corp. ($AVYA) | - | - | 7.4x | - | 77.9x |
| Alteryx, Inc. ($AYX) | - | - | 2.5x | 6.1x | 32.2x |
| Five9, Inc. ($FIVN) | -6.7x | -8.6x | 7.3x | 5.3x | 17.6x |
| Synchronoss Technologies, Inc. ($SNCR) | - | - | - | - | 11.6x |
| |
|---|
| Median (53 companies) | -0.9x | -0.9x | -0.7x | 0.4x | 0.0x |
|---|
| Blackbaud, Inc. ($BLKB) | 2.3x | 2.9x | 2.6x | 4.0x | 3.1x |
