Asure Software Inc reports 154% Net Income decline in 2020 while 48.8 pp EBITDA Margin growth from -42.0% to 6.8%
03/11/2021 • About Asure Software Inc (
$ASUR) • By InTwits
Asure Software Inc reported 2020 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Asure Software Inc spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for 2016-2020 is 0.0%. Average EBITDA Margin for the same period was -3.1%
- Asure Software Inc has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.7%. At the same time it's a lot of higher than industry average of 3.7%.
- CAPEX is quite volatile: $1m in 2020, $1m in 2019, $2m in 2018, $1m in 2017, $0m in 2016
- The company has unprofitable business model: ROIC is -7.4%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue dropped on 10.4%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin surged on 48.8 pp from -42.0% to 6.8% in 2020. During the last 5 years EBITDA Margin bottomed in 2019 at -42.0%.
Gross Margin decreased slightly on 1.1 pp from 59.2% to 58.2% in 2020. Gross Margin stuck to a declining trend at -5.6 pp per annum in 2016-2020. SG&A as a % of Revenue decreased on 2.1 pp from 57.5% to 55.5% in 2020.
Net Income margin dropped on 65.9 pp from 41.0% to -24.9% in 2020.
Investments (CAPEX, working capital and M&A)
Asure Software Inc's CAPEX/Revenue was 1.3% in 2020. The company's CAPEX/Revenue decreased slightly on 1.3 pp from 2.6% in 2017 to 1.3% in 2020. It's average level of CAPEX/Revenue for the last three years was 1.6%. During the last 5 years CAPEX as a % of Revenue topped in 2017 at 2.6% and was declining since that time.
Return on investment
The company operates at negative ROIC (-7.4%) and ROE (-11.5%). ROIC jumped on 18.7 pp from -26.1% to -7.4% in 2020. ROE dropped on 36.5 pp from 25.0% to -11.5% in 2020. During the last 5 years ROIC bottomed in 2019 at -26.1%.
Leverage (Debt)
Debt level is 0.7x Net Debt / EBITDA and 7.1x Debt / EBITDA. Net Debt / EBITDA surged0.7x from to 0.7x in 2020. Debt decreased on 7.3% while cash decreased slightly on 0.86%.
Asure Software Inc has no short term refinancing risk: cash is higher than short term debt (202.1%).
Financial and operational results
FY ended 12/31/2020
Asure Software Inc ($ASUR) key annual financial indicators| mln. $ | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 35.542 | 54.442 | 88.952 | 73.150 | 65.507 | -10.4% |
| Gross Profit | 27.425 | 41.823 | 58.122 | 43.314 | 38.093 | -12.1% |
| SG&A | 21.048 | 33.887 | 47.333 | 42.093 | 36.340 | -13.7% |
| EBITDA | 4.840 | 5.058 | 6.664 | -30.707 | 4.452 | |
| Net Income | -0.972 | -5.722 | -7.548 | 30.001 | -16.311 | -154.4% |
Balance Sheet
|
|---|
| Cash | 12.767 | 27.792 | 15.444 | 28.826 | 28.577 | -0.9% |
| Short Term Debt | 5.455 | 8.895 | 4.733 | 4.146 | 14.143 | 241.1% |
| Long Term Debt | 24.581 | 66.973 | 107.229 | 30.079 | 17.591 | -41.5% |
Cash flow
|
|---|
| Capex | 0.436 | 1.400 | 1.898 | 1.017 | 0.857 | -15.7% |
Ratios
|
|---|
| Revenue growth | 32.1% | 53.2% | 63.4% | -17.8% | -10.4% | |
| EBITDA growth | 79.6% | 4.5% | 31.8% | -560.8% | -114.5% | |
|
|---|
| Gross Margin | 77.2% | 76.8% | 65.3% | 59.2% | 58.2% | -1.1% |
| EBITDA Margin | 13.6% | 9.3% | 7.5% | -42.0% | 6.8% | 48.8% |
| SG&A, % of revenue | 59.2% | 62.2% | 53.2% | 57.5% | 55.5% | -2.1% |
| Net Income Margin | -2.7% | -10.5% | -8.5% | 41.0% | -24.9% | -65.9% |
| CAPEX, % of revenue | 1.2% | 2.6% | 2.1% | 1.4% | 1.3% | -0.1% |
|
|---|
| ROIC | 3.6% | -1.0% | -3.5% | -26.1% | -7.4% | 18.7% |
| ROE | -8.9% | -14.0% | -9.1% | 25.0% | -11.5% | -36.5% |
| Net Debt/EBITDA | 3.6x | 9.5x | 14.5x | | 0.7x |
Asure Software Inc ($ASUR) key quoterly financial indicators
| mln. $ | 20Q1 | 20Q2 | 20Q3 | 20Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 19 | 14 | 16 | 16 | | -7.2% | -43.2% | -10.3% | - |
| EBITDA | 2 | 1 | 0 | 2 | | -61.2% | -58.4% | -91.6% | - |
| Net Income | -2 | -4 | -5 | -6 | | - | - | - | - |
Balance Sheet
|
|---|
| Cash | 21 | 29 | 13 | 29 | | 25.2% | 99.6% | 2.9% | - |
| Short Term Debt | 4 | 17 | 13 | 14 | | -43.7% | 84.0% | 27.7% | - |
| Long Term Debt | 28 | 24 | 19 | 18 | | -76.9% | -79.7% | -84.2% | - |
Ratios
|
|---|
| Gross Margin | 58.6% | 57.4% | 56.7% | 59.7% | | -10.7% | -2.9% | -3.7% | - |
| EBITDA Margin | 8.3% | 8.4% | 0.6% | 9.7% | | -11.6% | -3.1% | -5.7% | - |
| Net Income Margin | -9.3% | -27.9% | -29.7% | -35.6% | | 4.9% | -7.9% | -10.9% | - |
Peers in Application Software
Below you can find Asure Software 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. ($SMAR) | - | 64.3% | 66.1% | 59.7% | 52.4% |
| |
|---|
| Median (92 companies) | 12.0% | 14.8% | 15.1% | 19.5% | 14.7% |
|---|
| Asure Software Inc ($ASUR) | - | 53.2% | 63.4% | -17.8% | -10.4% |
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. ($CDNS) | 85.9% | 87.8% | 87.9% | 88.6% | 88.6% |
| |
|---|
| Median (89 companies) | 63.8% | 64.4% | 66.0% | 68.4% | 70.6% |
|---|
| Asure Software Inc ($ASUR) | 77.2% | 76.8% | 65.3% | 59.2% | 58.2% |
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. ($SSNC) | 34.9% | 37.9% | 27.7% | 38.2% | 38.3% |
| |
|---|
| Median (89 companies) | -5.3% | -4.2% | -3.3% | 4.5% | 7.7% |
|---|
| Asure Software Inc ($ASUR) | 13.6% | 9.3% | 7.5% | -42.0% | 6.8% |
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. ($PRO) | 4.7% | 0.8% | 0.7% | 2.1% | 11.3% |
| |
|---|
| Median (87 companies) | 3.0% | 2.3% | 2.4% | 3.0% | 2.6% |
|---|
| Asure Software Inc ($ASUR) | 1.2% | 2.6% | 2.1% | 1.4% | 1.3% |
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. ($PAYC) | 75.4% | 51.1% | 47.5% | 47.5% | 28.7% |
| |
|---|
| Median (92 companies) | -9.8% | -11.8% | -10.6% | -4.2% | -1.8% |
|---|
| Asure Software Inc ($ASUR) | 3.6% | -1.0% | -3.5% | -26.1% | -7.4% |
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. ($SNCR) | - | - | - | - | 11.6x |
| |
|---|
| Median (53 companies) | -0.9x | -0.9x | -0.7x | 0.4x | 0.0x |
|---|
| Asure Software Inc ($ASUR) | 3.6x | 9.5x | 14.5x | - | 0.7x |
