Hudson's Bay Co reports 354% EBITDA growth and 56.4% Revenue growth
07.04.2015 • About Hudson's Bay Co (
$HBC) • By InTwits
Hudson's Bay Co reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is quite volatile: 10.0% in FY2015, 3.4% in FY2014, 5.5% in FY2013, 7.8% in FY2012, 6.6% in FY2011
- Hudson's Bay Co has low CAPEX intensity: 5 year average CAPEX/Revenue was 4.3%. At the same time it's in pair with industry average of 4.4%.
- CAPEX is quite volatile: 426 in FY2015, 292 in FY2014, 159 in FY2013, 144 in FY2012, 110 in FY2011
- The company has business model with low profitability: ROIC is at 7.9%
- It operates with high leverage: Net Debt/EBITDA is 3.6x while industry average is 1.6x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Hudson's Bay Co ($HBC) key annual financial indicators
| mln. CAD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 3,718 | 3,850 | 4,077 | 5,223 | 8,169 | 56.4% |
| Gross Profit | 1,509 | 1,544 | 1,590 | 2,006 | 3,268 | 62.9% |
| SG&A | 1,361 | 1,347 | 1,370 | 1,826 | 2,759 | 51.1% |
| EBITDA | 244 | 302 | 225 | 180 | 817 | 353.9% |
| Net Income | 88 | 1,449 | -35 | -259 | 233 | -190.0% |
Balance Sheet
|
|---|
| Cash | 57 | 42 | 48 | 21 | 168 | 700.0% |
| Short Term Debt | 749 | 291 | 132 | 532 | 265 | -50.2% |
| Long Term Debt | 1,430 | 902 | 719 | 2,923 | 2,859 | -2.2% |
Cash flow
|
|---|
| Capex | 110 | 144 | 159 | 292 | 426 | 45.9% |
Ratios
|
|---|
| Revenue growth | 2.7% | 3.5% | 5.9% | 28.1% | 56.4% | |
| EBITDA growth | 120.7% | 23.5% | -25.6% | -19.9% | 353.9% | |
| Gross Margin | 40.6% | 40.1% | 39.0% | 38.4% | 40.0% | 1.6% |
| EBITDA Margin | 6.6% | 7.8% | 5.5% | 3.4% | 10.0% | 6.6% |
| Net Income Margin | 2.4% | 37.6% | -0.9% | -5.0% | 2.9% | 7.8% |
| SG&A, % of revenue | 36.6% | 35.0% | 33.6% | 35.0% | 33.8% | -1.2% |
| CAPEX, % of revenue | 3.0% | 3.7% | 3.9% | 5.6% | 5.2% | -0.4% |
| ROIC | | 9.5% | 6.3% | 0.1% | 7.9% | 7.8% |
| ROE | | 245.0% | -3.6% | -17.0% | 10.3% | 27.3% |
| Net Debt/EBITDA | 8.7x | 3.8x | 3.6x | 19.1x | 3.6x | -15.5x |
Revenue and profitability
Hudson's Bay Co's Revenue jumped on 56.4% in FY2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 46.6 pp from 27.8% to -18.8% in 2015.
Gross Margin increased slightly on 1.6 pp from 38.4% to 40.0% in FY2015. SG&A as a % of Revenue decreased slightly on 1.2 pp from 35.0% to 33.8% in FY2015.
Net Income marign increased on 7.8 pp from -5.0% to 2.9% in FY2015.
Capital expenditures (CAPEX) and working capital investments
In FY2015 Hudson's Bay Co had CAPEX/Revenue of 5.2%. The company showed small growth in CAPEX/Revenue of 1.5 pp from 3.7% in FY2012 to 5.2% in FY2015. For the last three years the average CAPEX/Revenue was 4.9%.To secure this fast growth the company invested a large share of EBITDA (52.1%) to CAPEX.
Return on investment
The company operates at low ROIC (7.95%) and ROE (10.32%). ROIC increased on 7.8 pp from 0.13% to 7.9% in FY2015. ROE jumped on 27.3 pp from -17.0% to 10.3% in FY2015.
Leverage (Debt)
Debt level is 3.6x Net Debt / EBITDA and 3.8x Debt / EBITDA. Net Debt / EBITDA dropped on 15.5x from 19.1x to 3.6x in FY2015. Debt decreased on 9.6% in FY2015 while cash surged on 700% in FY2015.
Management team
Hudson's Bay Co's CEO is Gerald L Storch "Jerry". Gerald L Storch "Jerry" is a founder and has 3 years tenure at the company. Paul V Beesley is a Hudson's Bay Co's CFO. Paul V Beesley has spent 4 years at the company.
Appendix 1: Peers in Consumer, Cyclical
Below we provide Hudson's Bay Co benchmarking against other companies in Consumer, Cyclical 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 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Amaya Inc ($AYA) | 216.4% | 311.5% | 85.2% | 254.0% | |
| Partner Jet Corp ($PJT) | -19.9% | -15.2% | 1.2% | 119.7% | |
| Kelso Technologies Inc ($KLS) | 80.5% | 577.5% | 487.8% | 81.4% | |
| XPEL Technologies Corp ($DAP.U) | 46.3% | 76.6% | 67.7% | 65.5% | |
| Holloway Lodging Corp ($HLC) | 5.4% | -24.6% | 2.7% | 62.7% | |
| |
|---|
| Median (63 companies) | 10.9% | 5.4% | 5.1% | 6.6% | 4.1% |
|---|
| Hudson's Bay Co ($HBC) | | 3.5% | 5.9% | 28.1% | 56.4% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Restaurant Brands International Inc ($QSR) | | | 69.7% | 87.0% | |
| Imvescor Restaurant Group Inc ($IRG) | 96.2% | 94.2% | 89.7% | 84.9% | |
| DEQ Systems Corp ($DEQ) | 74.3% | 77.5% | 78.4% | 84.7% | |
| Second Cup Ltd/The ($SCU) | 91.1% | 86.6% | 85.1% | 72.7% | |
| New Look Vision Group Inc ($BCI) | 72.3% | 71.8% | 72.6% | 72.6% | |
| |
|---|
| Median (56 companies) | 37.0% | 34.1% | 31.8% | 33.5% | 34.7% |
|---|
| Hudson's Bay Co ($HBC) | 40.6% | 40.1% | 39.0% | 38.4% | 40.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Westshore Terminals Investment Corp ($WTE) | | 49.7% | 65.9% | 60.9% | 59.6% |
| Gamehost Inc ($GH) | 44.2% | 46.1% | 45.7% | 45.9% | |
| Great Canadian Gaming Corp ($GC) | 34.1% | 16.8% | 41.1% | 40.1% | |
| Amaya Inc ($AYA) | -5.7% | 7.2% | 38.2% | 39.3% | |
| MTY Food Group Inc ($MTY) | 32.2% | 36.3% | 38.7% | 37.0% | |
| |
|---|
| Median (61 companies) | 8.9% | 8.7% | 10.5% | 10.2% | 10.0% |
|---|
| Hudson's Bay Co ($HBC) | 6.6% | 7.8% | 5.5% | 3.4% | 10.0% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Poydras Gaming Finance Corp ($PYD) | | | | 32.5% | |
| WestJet Airlines Ltd ($WJA) | 3.9% | 7.9% | 19.5% | 18.6% | |
| Exchange Income Corp ($EIF) | 8.2% | 7.9% | 15.8% | 15.5% | |
| Holloway Lodging Corp ($HLC) | 3.4% | 8.2% | 6.7% | 14.8% | |
| Kelso Technologies Inc ($KLS) | 79.2% | 0.4% | 0.7% | 13.5% | |
| |
|---|
| Median (64 companies) | 2.5% | 2.7% | 2.7% | 2.2% | 3.1% |
|---|
| Hudson's Bay Co ($HBC) | 3.0% | 3.7% | 3.9% | 5.6% | 5.2% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Partner Jet Corp ($PJT) | -30.7% | -51.6% | -50.8% | 85.1% | |
| Kelso Technologies Inc ($KLS) | -121.3% | | | 48.8% | |
| XPEL Technologies Corp ($DAP.U) | 52.9% | 54.7% | 57.5% | 43.2% | |
| Westshore Terminals Investment Corp ($WTE) | | 24.0% | 37.8% | 35.0% | 38.3% |
| Iplayco Corp Ltd ($IPC) | -35.4% | 23.0% | 58.5% | 33.6% | |
| |
|---|
| Median (64 companies) | 10.9% | 10.5% | 11.8% | 10.1% | 4.4% |
|---|
| Hudson's Bay Co ($HBC) | | 9.5% | 6.3% | 0.1% | 7.9% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Restaurant Brands International Inc ($QSR) | | | 3.8x | 33.6x | |
| Allied Hotel Properties Inc ($AHP) | | | | 21.3x | |
| Amaya Inc ($AYA) | | 17.9x | 1.8x | 13.5x | |
| Dorel Industries Inc ($DII.A) | 1.6x | 1.5x | 2.8x | 12.2x | |
| Performance Sports Group Ltd ($PSG) | | 2.6x | 3.5x | 12.2x | 6.5x |
| |
|---|
| Median (55 companies) | 1.2x | 1.2x | 1.5x | 1.7x | 1.1x |
|---|
| Hudson's Bay Co ($HBC) | 8.7x | 3.8x | 3.6x | 19.1x | 3.6x |
