AIM:KMK

Stock Analysis Report

Executive Summary

Kromek Group plc, together with its subsidiaries, develops, manufactures, and sells radiation detection products for applications in the medical, nuclear, and security screening markets worldwide.

Rewards

Revenue is forecast to grow 18.51% per year

Earnings have grown 21.3% per year over the past 5 years

Risk Analysis

Has less than 1 year of cash runway

Currently unprofitable and not forecast to become profitable over the next 3 years

Highly volatile share price over past 3 months

Shareholders have been diluted in the past year



Snowflake Analysis

Adequate balance sheet and overvalued.

Share Price & News

How has Kromek Group's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: KMK's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-4.1%

KMK

4.4%

GB Semiconductor

-0.9%

GB Market


1 Year Return

-13.1%

KMK

-28.6%

GB Semiconductor

6.2%

GB Market

Return vs Industry: KMK exceeded the UK Semiconductor industry which returned -28.6% over the past year.

Return vs Market: KMK underperformed the UK Market which returned 6.2% over the past year.


Shareholder returns

KMKIndustryMarket
7 Day-4.1%4.4%-0.9%
30 Day-8.8%18.6%-3.1%
90 Day26.5%25.2%3.9%
1 Year-13.1%-13.1%-25.5%-28.6%11.9%6.2%
3 Year18.8%8.1%-7.5%-12.9%17.3%2.4%
5 Year-35.4%-41.1%-16.9%-20.3%34.1%3.2%

Price Volatility Vs. Market

How volatile is Kromek Group's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Kromek Group undervalued compared to its fair value and its price relative to the market?

1.36x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: Insufficient data to calculate KMK's fair value to establish if it is undervalued.

Significantly Below Fair Value: Insufficient data to calculate KMK's fair value to establish if it is undervalued.


Price To Earnings Ratio

PE vs Industry: KMK is unprofitable, so we can't compare its PE Ratio to the Semiconductor industry average.

PE vs Market: KMK is unprofitable, so we can't compare its PE Ratio to the UK market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate KMK's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: KMK is good value based on its PB Ratio (1.4x) compared to the GB Semiconductor industry average (1.4x).


Next Steps

Future Growth

How is Kromek Group forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

57.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: KMK is forecast to remain unprofitable over the next 3 years.

Earnings vs Market: KMK is forecast to remain unprofitable over the next 3 years.

High Growth Earnings: KMK is forecast to remain unprofitable over the next 3 years.

Revenue vs Market: KMK's revenue (18.5% per year) is forecast to grow faster than the UK market (3.5% per year).

High Growth Revenue: KMK's revenue (18.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if KMK's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Kromek Group performed over the past 5 years?

21.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: KMK is currently unprofitable.

Growing Profit Margin: KMK is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: KMK is unprofitable, but has reduced losses over the past 5 years at a rate of 21.3% per year.

Accelerating Growth: Unable to compare KMK's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: KMK is unprofitable, making it difficult to compare its past year earnings growth to the Semiconductor industry (-19%).


Return on Equity

High ROE: KMK has a negative Return on Equity (-1.52%), as it is currently unprofitable.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Kromek Group's financial position?


Financial Position Analysis

Short Term Liabilities: KMK's short term assets (£38.8M) exceed its short term liabilities (£9.2M).

Long Term Liabilities: KMK's short term assets (£38.8M) exceed its long term liabilities (£6.0M).


Debt to Equity History and Analysis

Debt Level: KMK's debt to equity ratio (9.8%) is considered satisfactory.

Reducing Debt: KMK's debt to equity ratio has increased from 0.07% to 9.8% over the past 5 years.


Balance Sheet

Inventory Level: KMK has a high level of physical assets or inventory.

Debt Coverage by Assets: KMK's debt is covered by short term assets (assets are 6.7x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: KMK has sufficient cash runway for more than a year based on its current free cash flow.

Forecast Cash Runway: KMK has less than a year of cash runway if free cash flow continues to reduce at historical rates of -18% each year


Next Steps

Dividend

What is Kromek Group's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.8%markettop25%5.1%industryaverage1.1%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate KMK's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate KMK's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if KMK's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if KMK's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of KMK's dividend in 3 years as they are not forecast to pay a notable one for the UK market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

4.2yrs

Average management tenure


CEO

Arnab Basu (46yo)

UK£364,000

Compensation

Dr. Arnab Basu, MBE serves as the Chief Executive Officer of Kromek Group plc (former, Name: Durham Scientific Crystals Ltd). Dr. Basu served as Managing Director of Kromek Group plc. Dr. Basu held senior  ...


CEO Compensation Analysis

Compensation vs Market: Arnab's total compensation ($USD474.15K) is above average for companies of similar size in the UK market ($USD325.33K).

Compensation vs Earnings: Arnab's compensation has increased whilst the company is unprofitable.


Leadership Team

NamePositionTenureCompensationOwnership
Arnab Basu
CEO & Executive Director0yrsUK£364.00k0.86% £691.0k
Derek Bulmer
CFO, Company Secretary & Executive Director6.2yrsUK£230.00k0.038% £30.8k
Berry Beumer
Chief Operating Officer4.3yrsno datano data
Ian Radley
Chief Technical Officer0yrsno datano data
Brian Tanner
4.1yrsno datano data
Max Robinson
4.1yrsno datano data

4.2yrs

Average Tenure

62yo

Average Age

Experienced Management: KMK's management team is considered experienced (4.2 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Arnab Basu
CEO & Executive Director0yrsUK£364.00k0.86% £691.0k
Derek Bulmer
CFO, Company Secretary & Executive Director6.2yrsUK£230.00k0.038% £30.8k
Jerel Whittingham
Non Executive Director6.4yrsUK£41.00k0.11% £84.8k
Peter Williams
Independent Chairman of the Board4.3yrsUK£74.00k0.058% £46.5k
Christopher Wilks
Non-Executive Director2.3yrsUK£38.00k0.051% £40.7k
Lawrence Henry Kinet
Independent Non-Executive Director6.5yrsUK£38.00k0.087% £69.8k

6.2yrs

Average Tenure

55.5yo

Average Age

Experienced Board: KMK's board of directors are considered experienced (6.2 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: KMK insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 21.7%.


Top Shareholders

Company Information

Kromek Group plc's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Kromek Group plc
  • Ticker: KMK
  • Exchange: AIM
  • Founded: 2003
  • Industry: Semiconductors
  • Sector: Semiconductors
  • Market Cap: UK£80.128m
  • Shares outstanding: 344.64m
  • Website: https://www.kromek.com

Number of Employees


Location

  • Kromek Group plc
  • NETPark
  • Thomas Wright Way
  • Sedgefield
  • County Durham
  • TS21 3FD
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
KMKAIM (London Stock Exchange AIM Market)YesNew Ordinary SharesGBGBPOct 2013
4KMBST (Boerse-Stuttgart)YesNew Ordinary SharesDEEUROct 2013

Biography

Kromek Group plc, together with its subsidiaries, develops, manufactures, and sells radiation detection products for applications in the medical, nuclear, and security screening markets worldwide. Its solutions provide high resolution information on material composition and structure to enable the identification of cancerous tissues and hazardous materials, as well as for the analysis of radioactive materials. The company also provides a range of radiation detectors that use cadmium zinc telluride (CZT) or scintillator technology, such as handheld rugged gamma detectors, thermal neutron detectors, gamma-ray detector spectrometers, scintillator detectors, preamplifiers for radiation detectors and detector electronics, and gamma-ray CZT detectors. In addition, it offers medical imaging products, including CZT gamma cameras for SPECT imaging, CZT surgical gamma probes, CZT bone mineral densitometry, and photon-counting spectral CT. Further, the company provides security products, such as D3S wearable RIID gamma neutron detectors; liquid explosive detection algorithm for type c systems; Identifier liquid explosive detectors; and X-ray scalable linear arrays. Additionally, it engages in scientific research and development activities. Kromek Group plc was incorporated in 2003 and is headquartered in Sedgefield, the United Kingdom. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/18 22:32
End of Day Share Price2020/02/18 00:00
Earnings2019/10/31
Annual Earnings2019/04/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.