TransAct Technologies Incorporated reports 315% EBITDA decline in 2020 and 33.1% Revenue decline
03/09/2021 • About TransAct Technologies Incorporated (
$TACT) • By InTwits
TransAct Technologies Incorporated reported 2020 financial results today. Here are the key drivers of the company's long term financial model:
- TransAct Technologies Incorporated is a company in decline: 2020 revenue growth was -33.1%, 5 years revenue CAGR was -12.5%
- EBITDA Margin is quite volatile: -19.1% in 2020, 5.9% in 2019, 14.2% in 2018, 14.0% in 2017, 11.4% in 2016
- TransAct Technologies Incorporated has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.1%. At the same time it's in pair with industry average of 3.7%
- CAPEX is quite volatile: $1m in 2020, $1m in 2019, $1m in 2018, $1m in 2017, $1m in 2016
- The company has unprofitable business model: ROIC is -27.0%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
TransAct Technologies Incorporated's Revenue dropped on 33.1%. Annual revenue decline showed slowdown in 20Q4 - revenue dropped on 30.5%. During the last 5 years Revenue growth topped in 2017 at -1.6% and was decelerating since that time. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin jumped on 11.5 pp from -13.4% to -1.9% in 2020. During 2016-2020 EBITDA Margin topped in 2018 at 14.2% and was declining since that time.
Gross Margin decreased on 5.7 pp from 47.9% to 42.3% in 2020. During 2016-2020 Gross Margin topped in 2018 at 49.0% and was declining since that time. SG&A as a % of Revenue jumped on 12.7 pp from 37.6% to 50.3% in 2020. SG&A as a % of Revenue grew at 6.1 pp per annum in 2016-2020.
Net Income margin dropped on 19.5 pp from 1.1% to -18.4% in 2020.
Investments (CAPEX, working capital and M&A)
In 2020 TransAct Technologies Incorporated had CAPEX/Revenue of 2.4%. CAPEX/Revenue increased slightly on 0.68 pp from 1.7% in 2017 to 2.4% in 2020. It's average CAPEX/Revenue for the last three years was 2.5%.
Return on investment
The company operates at negative ROIC (-27.0%) and ROE (-20.0%). ROIC dropped on 28.7 pp from 1.8% to -27.0% in 2020. ROE dropped on 22.0 pp from 1.9% to -20.0% in 2020. During 2016-2020 ROIC topped in 2017 at 30.7% and was declining since that time.
Leverage (Debt)
Company's Net Debt / EBITDA is -1.7x and Debt / EBITDA is . Debt jumped on 92.7% while cash surged on 146%.
TransAct Technologies Incorporated has no short term refinancing risk: cash is higher than short term debt (1,237.6%).
Management team
TransAct Technologies Incorporated's CEO is Bart C Shuldman. Bart C Shuldman has 24 years tenure with the company. Steven A Demartino is a the company's CFO. Steven A Demartino has spent 16 years at the company.
Financial and operational results
FY ended 12/31/2020
TransAct Technologies Incorporated ($TACT) key annual financial indicators| mln. $ | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 57.235 | 56.311 | 54.587 | 45.748 | 30.595 | -33.1% |
| Gross Profit | 23.799 | 26.662 | 26.743 | 21.935 | 12.929 | -41.1% |
| SG&A | 14.174 | 15.545 | 15.408 | 17.199 | 15.399 | -10.5% |
| EBITDA | 6.531 | 7.895 | 7.756 | 2.714 | -5.831 | -314.8% |
| Net Income | 3.617 | 3.211 | 5.426 | 0.516 | -5.630 | -1,191.1% |
Balance Sheet
|
|---|
| Cash | 2.503 | 5.507 | 4.691 | 4.203 | 10.359 | 146.5% |
| Short Term Debt | 0.000 | 0.000 | 0.000 | 0.945 | 0.837 | -11.4% |
| Long Term Debt | 0.000 | 0.000 | 0.000 | 2.104 | 5.037 | 139.4% |
Cash flow
|
|---|
| Capex | 0.608 | 0.985 | 1.473 | 1.062 | 0.744 | -29.9% |
Ratios
|
|---|
| Revenue growth | -4.1% | -1.6% | -3.1% | -16.2% | -33.1% | |
| EBITDA growth | 10.8% | 20.9% | -1.8% | -65.0% | -314.8% | |
|
|---|
| Gross Margin | 41.6% | 47.3% | 49.0% | 47.9% | 42.3% | -5.7% |
| EBITDA Margin | 11.4% | 14.0% | 14.2% | 5.9% | -19.1% | -25.0% |
| SG&A, % of revenue | 24.8% | 27.6% | 28.2% | 37.6% | 50.3% | 12.7% |
| Net Income Margin | 6.3% | 5.7% | 9.9% | 1.1% | -18.4% | -19.5% |
| CAPEX, % of revenue | 1.1% | 1.7% | 2.7% | 2.3% | 2.4% | 0.1% |
|
|---|
| ROIC | 23.9% | 30.7% | 27.5% | 1.8% | -27.0% | -28.7% |
| ROE | 14.5% | 12.8% | 20.3% | 1.9% | -20.0% | -22.0% |
| Net Debt/EBITDA | -0.4x | -0.7x | -0.6x | -0.4x | |
TransAct Technologies Incorporated ($TACT) key quoterly financial indicators
| mln. $ | 20Q1 | 20Q2 | 20Q3 | 20Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 10 | 5 | 7 | 8 | | -11.3% | -53.4% | -37.5% | -30.5% |
| EBITDA | -1 | -2 | -1 | -2 | | -163.7% | -380.4% | -217.7% | - |
| Net Income | -1 | -2 | -1 | -2 | | -233.0% | -1,096.2% | -325.8% | - |
Balance Sheet
|
|---|
| Cash | 1 | 3 | 1 | 10 | | -68.4% | -28.3% | -21.5% | 146.5% |
| Short Term Debt | 2 | 1 | 1 | 1 | | 84.2% | -4.2% | -8.0% | -11.4% |
| Long Term Debt | 3 | 5 | 5 | 5 | | 23.1% | 110.5% | 124.4% | 139.4% |
Ratios
|
|---|
| Gross Margin | 48.0% | 43.3% | 45.9% | 30.6% | | -4.7% | -6.9% | -1.6% | -10.6% |
| EBITDA Margin | -7.9% | -42.4% | -13.3% | -23.3% | | -18.8% | -49.4% | -20.4% | -21.6% |
| Net Income Margin | -9.7% | -35.1% | -11.9% | -24.7% | | -16.1% | -36.7% | -15.2% | -17.5% |
Peers in Technology Hardware, Storage & Peripherals
Below we provide TransAct Technologies Incorporated benchmarking against other companies in Technology Hardware, Storage & Peripherals 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 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Ionix Technology Inc ($IINX) | - | 246.0% | -5.8% | 92.3% | 66.8% |
| Veritec Inc ($VRTC) | - | -52.2% | 53.1% | -38.5% | 42.9% |
| Pure Storage, Inc. ($PSTG) | - | 67.9% | 38.6% | 32.7% | 20.9% |
| USA Technologies, Inc. ($USAT) | - | 34.5% | - | - | 12.9% |
| CPI Card Group Inc. ($PMTS) | - | -17.4% | 0.4% | 8.7% | 12.3% |
| |
|---|
| Median (20 companies) | 1.4% | 2.1% | 5.6% | -2.0% | -8.8% |
|---|
| TransAct Technologies Incorporated ($TACT) | - | -1.6% | -3.1% | -16.2% | -33.1% |
Top companies by Gross margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Immersion Corporation ($IMMR) | 99.7% | 99.4% | 99.8% | 99.5% | 99.4% |
| Datasea Inc ($DTSS) | - | 39.3% | 54.4% | - | 89.7% |
| Pure Storage, Inc. ($PSTG) | 61.9% | 65.9% | 65.5% | 66.4% | 69.0% |
| Avid Technology, Inc. ($AVID) | 65.0% | 57.8% | 57.9% | 60.5% | 63.3% |
| Socket Mobile, Inc. ($SCKT) | 50.2% | 53.5% | 51.4% | 52.5% | 53.1% |
| |
|---|
| Median (21 companies) | 38.5% | 38.9% | 38.3% | 32.7% | 37.4% |
|---|
| TransAct Technologies Incorporated ($TACT) | 41.6% | 47.3% | 49.0% | 47.9% | 42.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Apple Inc. ($AAPL) | 32.7% | 31.2% | 30.8% | 29.4% | 28.7% |
| CPI Card Group Inc. ($PMTS) | 14.9% | -0.0% | 9.0% | 15.2% | 17.9% |
| Immersion Corporation ($IMMR) | -25.1% | -127.0% | 48.6% | -50.4% | 17.4% |
| Avid Technology, Inc. ($AVID) | 17.5% | 6.6% | 8.4% | 13.5% | 13.6% |
| Western Digital Corporation ($WDC) | 12.5% | 21.4% | 27.5% | 11.5% | 11.7% |
| |
|---|
| Median (19 companies) | 3.8% | 3.5% | 7.9% | 7.9% | 7.9% |
|---|
| TransAct Technologies Incorporated ($TACT) | 11.4% | 14.0% | 14.2% | 5.9% | -19.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Datasea Inc ($DTSS) | - | 0.0% | 0.0% | - | 20.9% |
| Hewlett Packard Enterprise Company ($HPE) | 10.8% | 10.9% | 9.6% | 9.8% | 8.8% |
| Pure Storage, Inc. ($PSTG) | 8.9% | 10.4% | 6.3% | 7.4% | 5.3% |
| Stratasys, Ltd. ($SSYS) | 6.7% | 3.3% | 3.5% | 3.5% | 5.2% |
| Western Digital Corporation ($WDC) | 4.5% | 3.0% | 4.0% | 5.3% | 3.9% |
| |
|---|
| Median (19 companies) | 2.0% | 1.9% | 2.2% | 1.7% | 1.7% |
|---|
| TransAct Technologies Incorporated ($TACT) | 1.1% | 1.7% | 2.7% | 2.3% | 2.4% |
Top companies by ROIC, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| HP Inc. ($HPQ) | 15.8% | 60.8% | 72.9% | 116.0% | 109.2% |
| Apple Inc. ($AAPL) | 27.0% | 23.8% | 28.0% | 29.5% | 33.0% |
| Avid Technology, Inc. ($AVID) | - | - | 252.4% | 42.1% | 30.0% |
| CPI Card Group Inc. ($PMTS) | 12.8% | -9.3% | 2.7% | 15.4% | 20.5% |
| NCR Corporation ($NCR) | 13.9% | 16.3% | 4.6% | 14.3% | 5.5% |
| |
|---|
| Median (21 companies) | -2.6% | 0.2% | 2.2% | 4.2% | 2.6% |
|---|
| TransAct Technologies Incorporated ($TACT) | 23.9% | 30.7% | 27.5% | 1.8% | -27.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Diebold Nixdorf Incorporated ($DBD) | - | 8.3x | - | 6.6x | 7.3x |
| CPI Card Group Inc. ($PMTS) | 5.8x | - | 12.4x | 7.2x | 5.2x |
| Hewlett Packard Enterprise Company ($HPE) | 0.4x | 1.2x | 1.6x | 2.6x | 5.2x |
| NCR Corporation ($NCR) | 2.7x | 2.3x | 5.2x | 3.3x | 4.8x |
| Western Digital Corporation ($WDC) | 5.5x | 1.7x | 1.1x | 3.7x | 3.5x |
| |
|---|
| Median (12 companies) | 0.4x | 0.5x | 1.1x | 1.8x | 3.0x |
|---|
