Talend S.A. reports 16.0% revenue growth in 2020 and 1.3 pp EBITDA Margin decline from -20.4% to -21.7%
02/10/2021 • About Talend S.A. (
$TLND) • By InTwits
Talend S.A. reported 2020 financial results today. Here are the key drivers of the company's long term financial model:
- Talend S.A. is a fast growth stock: 2020 revenue growth was 16.0%, 5 year revenue CAGR was 30.5% at 2020 ROIC -35.8%
- The company operates at negative EBITDA Margin: -21.7%
- Talend S.A. motivates its personel by high Stock Based Compensation (SBC): average SBC/Revenue for 2016-2020 was 3.0% while average EBITDA Margin was -20.2% for the sames years
- Talend S.A. has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.7%. At the same time it's in pair with industry average of 3.2%
- CAPEX is quite volatile: $7m in 2020, $2m in 2019, $5m in 2018, $2m in 2017, $1m in 2016
- The company has unprofitable business model: ROIC is -35.8%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue jumped on 16.0%. Revenue growth showed acceleration in 20Q4 - it increased 17.0% YoY. Revenue decline was accelerating on average at -6.6 pp per annum in 2016-2020. Revenue growth was financed by EBITDA margin decline. EBITDA Margin decreased slightly on 1.3 pp from -20.4% to -21.7% in 2020. During the last 5 years EBITDA Margin topped in 2017 at -17.9% and was declining since that time.
Gross Margin increased on 2.6 pp from 75.4% to 78.0% in 2020. SG&A as a % of Revenue increased on 4.9 pp from 73.6% to 78.5% in 2020. During the last 5 years SG&A as a % of Revenue bottomed in 2019 at 73.6%.
Net Income margin decreased on 2.9 pp from -24.8% to -27.7% in 2020. During the last 5 years Net Income margin topped in 2018 at -19.8% and was declining since that time.
Investments (CAPEX, working capital and M&A)
In 2020 the company had CAPEX/Revenue of 2.4%. CAPEX/Revenue increased slightly on 0.88 pp from 1.5% in 2017 to 2.4% in 2020. It's average level of CAPEX/Revenue for the last three years was 1.9%.
Return on investment
The company operates at negative ROIC (-35.8%) and ROE (-356.3%). ROIC jumped on 14.3 pp from -50.1% to -35.8% in 2020. ROE dropped on 174 pp from -182% to -356% in 2020.
Leverage (Debt)
Company's Net Debt / EBITDA is -6.5x and Debt / EBITDA is . Net Debt / EBITDA didn't change in 2020. Debt jumped on 16.3% while cash decreased on 8.0%.
Talend S.A. has no short term refinancing risk: cash is higher than short term debt (3,394.2%).
Financial and operational results
FY ended 12/31/2020
Talend S.A. ($TLND) key annual financial indicators| mln. $ | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 106.0 | 148.6 | 204.3 | 247.9 | 287.5 | 16.0% |
| Gross Profit | 80.4 | 114.4 | 154.8 | 187.0 | 224.3 | 20.0% |
| SG&A | 87.2 | 116.3 | 154.0 | 182.5 | 225.7 | 23.7% |
| EBITDA | -24.5 | -26.6 | -37.0 | -50.5 | -62.4 | |
| EBIT | -26.0 | -28.7 | -41.5 | | | |
| Interest expence | 0.8 | | | | | |
| Tax | 0.1 | 0.3 | -0.3 | | | |
| Net Income | -24.2 | -31.2 | -40.4 | -61.5 | -79.6 | |
| Stock Based Compensation | 3.0 | 6.3 | 20.8 | | | |
Balance Sheet
|
|---|
| Cash | 91.0 | 87.0 | 33.7 | 177.1 | 162.9 | -8.0% |
| Accounts Receivable | 38.0 | 57.1 | 67.5 | | | |
| Accounts Payable | | | 5.8 | | | |
| Short Term Debt | 0.1 | 1.2 | 0.2 | 5.3 | 4.8 | -9.0% |
| Long Term Debt | 0.0 | 0.0 | 0.7 | 154.7 | 181.4 | 17.2% |
Cash flow
|
|---|
| Capex | 1.4 | 2.2 | 5.0 | 2.2 | 6.8 | 211.6% |
Ratios
|
|---|
| Revenue growth | 39.5% | 40.2% | 37.5% | 21.3% | 16.0% | |
| EBITDA growth | 22.6% | 8.8% | 38.8% | 36.4% | 23.6% | |
|
|---|
| Gross Margin | 75.9% | 77.0% | 75.8% | 75.4% | 78.0% | 2.6% |
| EBITDA Margin | -23.1% | -17.9% | -18.1% | -20.4% | -21.7% | -1.3% |
| EBIT Margin | -24.5% | -19.3% | -20.3% | | |
| SG&A, % of revenue | 82.2% | 78.3% | 75.4% | 73.6% | 78.5% | 4.9% |
| SBC, % of revenue | 2.8% | 4.2% | 10.2% | | |
| Net Income Margin | -22.9% | -21.0% | -19.8% | -24.8% | -27.7% | -2.9% |
| CAPEX, % of revenue | 1.3% | 1.5% | 2.5% | 0.9% | 2.4% | 1.5% |
|
|---|
| ROIC | | -303.7% | -321.0% | -50.1% | -35.8% | 14.3% |
| ROE | | | | -182.1% | -356.3% | -174.1% |
| Interest expence / Average debt | 530.9% | | | | | |
People
|
|---|
| Insider ownership | 3.1% | 3.1% | 3.1% | | | |
Talend S.A. ($TLND) key quoterly financial indicators
| mln. $ | 20Q1 | 20Q2 | 20Q3 | 20Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 68 | 68 | 73 | 79 | | 18.1% | 12.3% | 16.4% | 17.0% |
| EBITDA | -14 | -17 | -16 | -14 | | - | - | - | - |
| Net Income | -18 | -22 | -20 | -20 | | - | - | - | - |
Balance Sheet
|
|---|
| Cash | 178 | 165 | 161 | 163 | | 511.7% | 413.7% | -6.7% | -8.0% |
| Short Term Debt | 5 | 5 | 5 | 5 | | -3.8% | 1.6% | 2.8% | -9.0% |
| Long Term Debt | 152 | 155 | 174 | 181 | | 478.2% | 478.6% | 15.7% | 17.2% |
Ratios
|
|---|
| Gross Margin | 78.3% | 77.6% | 77.1% | 79.0% | | 4.7% | 3.7% | 0.8% | 1.5% |
| EBITDA Margin | -21.1% | -25.8% | -22.1% | -18.3% | | 5.7% | 1.0% | -4.1% | -7.0% |
| Net Income Margin | -26.6% | -31.8% | -28.0% | -24.8% | | 4.1% | -1.0% | -6.3% | -7.5% |
Peers in Systems Software
Below you can find Talend S.A. benchmarking vs. other companies in Systems 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 |
|---|
| Zscaler, Inc. ($ZS) | - | 56.5% | 51.3% | 59.2% | 42.4% |
| ServiceNow, Inc. ($NOW) | - | 38.0% | 36.0% | 32.6% | 30.6% |
| SailPoint Technologies Holdings, Inc. ($SAIL) | - | 40.5% | 33.8% | 15.9% | 26.6% |
| Rapid7, Inc. ($RPD) | - | 27.6% | 21.5% | 33.9% | 25.9% |
| Tenable Holdings, Inc. ($TENB) | - | 50.9% | 42.4% | 32.6% | 24.2% |
| |
|---|
| Median (23 companies) | 12.9% | 14.0% | 19.0% | 15.9% | 12.9% |
|---|
| Talend S.A. ($TLND) | - | 40.2% | 37.5% | 21.3% | 16.0% |
Top companies by Gross margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Check Point Software Technologies Ltd. ($CHKP) | 88.5% | 88.6% | 89.6% | 89.5% | 89.4% |
| Progress Software Corporation ($PRGS) | 83.8% | 82.6% | 83.1% | 81.8% | 86.0% |
| Varonis Systems, Inc. ($VRNS) | 90.5% | 90.4% | 89.8% | 86.2% | 84.9% |
| Vmware, Inc. ($VMW) | 85.2% | - | 85.5% | 83.9% | 83.4% |
| Tenable Holdings, Inc. ($TENB) | 88.6% | 86.4% | 83.9% | 82.8% | 82.4% |
| |
|---|
| Median (23 companies) | 73.1% | 73.9% | 73.5% | 76.6% | 76.5% |
|---|
| Talend S.A. ($TLND) | 75.9% | 77.0% | 75.8% | 75.4% | 78.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Check Point Software Technologies Ltd. ($CHKP) | 49.8% | 50.7% | 48.8% | 46.0% | 45.1% |
| Qualys, Inc. ($QLYS) | 23.8% | 25.1% | 28.4% | 36.5% | 40.3% |
| SolarWinds Corporation ($SWI) | -8.0% | 44.0% | 44.8% | 44.7% | 39.8% |
| Progress Software Corporation ($PRGS) | 2.4% | 28.6% | 32.9% | 23.4% | 34.4% |
| Fortinet, Inc. ($FTNT) | 7.2% | 11.1% | 15.9% | 19.8% | 23.9% |
| |
|---|
| Median (23 companies) | -8.0% | -3.6% | -3.9% | 0.2% | 3.0% |
|---|
| Talend S.A. ($TLND) | -23.1% | -17.9% | -18.1% | -20.4% | -21.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Zscaler, Inc. ($ZS) | 7.8% | 6.5% | 8.0% | 9.5% | 12.0% |
| ServiceNow, Inc. ($NOW) | 7.6% | 7.8% | 8.6% | 7.7% | 9.3% |
| Qualys, Inc. ($QLYS) | 11.7% | 16.4% | 8.2% | 8.6% | 8.3% |
| Zuora, Inc. ($ZUO) | 3.4% | 3.3% | 2.8% | 5.7% | 7.8% |
| Proofpoint, Inc. ($PFPT) | 9.2% | 9.0% | 4.1% | 4.0% | 6.9% |
| |
|---|
| Median (23 companies) | 2.1% | 2.4% | 2.6% | 3.8% | 3.4% |
|---|
| Talend S.A. ($TLND) | 1.3% | 1.5% | 2.5% | 0.9% | 2.4% |
Top companies by ROIC, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Fortinet, Inc. ($FTNT) | 5.3% | 15.0% | 28.0% | 29.0% | 46.3% |
| Check Point Software Technologies Ltd. ($CHKP) | 24.7% | 26.8% | 25.5% | 24.2% | 25.6% |
| Qualys, Inc. ($QLYS) | 13.7% | 12.3% | 14.3% | 18.7% | 22.0% |
| Vmware, Inc. ($VMW) | 15.9% | - | - | 18.1% | 19.6% |
| Progress Software Corporation ($PRGS) | -4.9% | 13.5% | 18.5% | 7.6% | 16.0% |
| |
|---|
| Median (23 companies) | -2.1% | -2.7% | -0.9% | -6.3% | -6.4% |
|---|
| Talend S.A. ($TLND) | - | -303.7% | -321.0% | -50.1% | -35.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| SolarWinds Corporation ($SWI) | - | 6.2x | 4.1x | 4.4x | 4.1x |
| Proofpoint, Inc. ($PFPT) | - | - | - | -27.4x | 2.5x |
| Progress Software Corporation ($PRGS) | -7.5x | -0.1x | 0.1x | 1.5x | 2.1x |
| Vmware, Inc. ($VMW) | -0.7x | - | -0.8x | 0.3x | 1.5x |
| CyberArk Software Ltd. ($CYBR) | -4.1x | -5.7x | -4.5x | -3.6x | 0.9x |
| |
|---|
| Median (12 companies) | -1.2x | -0.6x | -0.4x | -0.3x | 0.4x |
|---|
