Dominion Diamond Corp reports 105% EBITDA growth and 21.8% Revenue growth
08.04.2015 • About Dominion Diamond Corp (
$DDC) • By InTwits
Dominion Diamond Corp reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Dominion Diamond Corp is a growth stock: FY2015 revenue growth was 21.8%, 5 year revenue CAGR was 17.3% at FY2015 ROIC 11.1%
- Dominion Diamond Corp has high CAPEX intensity: 5 year average CAPEX/Revenue was 14.9%. At the same time it's a lot of higher than industry average of 28.4%.
- CAPEX is quite volatile: 168 in FY2015, 122 in FY2014, 56.5 in FY2013, 45.2 in FY2012, 48.6 in FY2011
- The company has business model with average profitability: ROIC is at 11.1%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Dominion Diamond Corp ($DDC) key annual financial indicators
| mln. $ | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 624.0 | 290.1 | 345.4 | 751.9 | 915.8 | 21.8% |
| Gross Profit | 236.3 | 62.2 | 77.8 | 101.1 | 233.1 | 130.6% |
| SG&A | 167.9 | 24.6 | 30.2 | 47.1 | 30.5 | -35.2% |
| EBITDA | 145.4 | 116.3 | 127.9 | 191.7 | 393.3 | 105.1% |
| Net Income | 41.5 | 25.5 | 34.7 | 479.7 | 67.1 | -86.0% |
Balance Sheet
|
|---|
| Cash | 108.7 | 78.1 | 104.3 | 224.8 | 457.9 | 103.7% |
| Short Term Debt | 94.2 | 29.2 | 51.5 | 0.8 | 11.3 | 1,324.2% |
| Long Term Debt | 235.5 | 270.5 | 4.8 | 3.5 | 34.0 | 869.9% |
Cash flow
|
|---|
| Capex | 48.6 | 45.2 | 56.5 | 122.3 | 168.3 | 37.6% |
Ratios
|
|---|
| Revenue growth | 51.1% | -53.5% | 19.1% | 117.7% | 21.8% | |
| EBITDA growth | | -20.0% | 10.0% | 49.8% | 105.1% | |
| Gross Margin | 37.9% | 21.4% | 22.5% | 13.4% | 25.5% | 12.0% |
| EBITDA Margin | 23.3% | 40.1% | 37.0% | 25.5% | 42.9% | 17.5% |
| Net Income Margin | 6.7% | 8.8% | 10.0% | 63.8% | 7.3% | -56.5% |
| SG&A, % of revenue | 26.9% | 8.5% | 8.7% | 6.3% | 3.3% | -2.9% |
| CAPEX, % of revenue | 7.8% | 15.6% | 16.4% | 16.3% | 18.4% | 2.1% |
| ROIC | 5.1% | 2.8% | 3.9% | 3.6% | 11.1% | 7.4% |
| ROE | 5.8% | 3.3% | 4.3% | 44.9% | 5.0% | -39.9% |
| Net Debt/EBITDA | 1.5x | 1.9x | -0.4x | -1.2x | -1.0x | 0.1x |
Revenue and profitability
Dominion Diamond Corp's Revenue surged on 21.8% in FY2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 73.0 pp from 18.7% to -54.3% in 2015.
Gross Margin jumped on 12.0 pp from 13.4% to 25.5% in FY2015. SG&A as a % of Revenue decreased on 2.9 pp from 6.3% to 3.3% in FY2015.
Net Income marign dropped on 56.5 pp from 63.8% to 7.3% in FY2015.
Capital expenditures (CAPEX) and working capital investments
Dominion Diamond Corp's CAPEX/Revenue was 18.4% in FY2015. The company's CAPEX/Revenue increased on 2.8 pp from 15.6% in FY2012 to 18.4% in FY2015. For the last three years the average CAPEX/Revenue was 17.0%.
Return on investment
The company operates at low ROIC (11.05%) and ROE (5.03%). ROIC increased on 7.4 pp from 3.6% to 11.1% in FY2015. ROE dropped on 39.9 pp from 44.9% to 5.0% in FY2015.
Leverage (Debt)
Debt level is -1.0x Net Debt / EBITDA and 0.1x Debt / EBITDA. Net Debt / EBITDA jumped on 0.1x from -1.2x to -1.0x in FY2015. Debt jumped on 954% in FY2015 while cash surged on 104% in FY2015.
Management team
Brendan Bell is a Dominion Diamond Corp's CEO. Brendan Bell is a founder and has spent 4 years at the company.
Appendix 1: Peers in Basic Materials
Below we provide Dominion Diamond Corp benchmarking against other companies in Basic Materials 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 |
|---|
| Northern Sun Mining Corp ($NSC) | -93.3% | 315.4% | -99.4% | 8,924.9% | |
| Turquoise Hill Resources Ltd ($TRQ) | | | -34.0% | 3,268.9% | -5.8% |
| Ur-Energy Inc ($URE) | | | | 285.4% | |
| Nevsun Resources Ltd ($NSU) | | 3.3% | -72.5% | 256.5% | |
| Detour Gold Corp ($DGC) | | | | 248.1% | |
| |
|---|
| Median (120 companies) | 27.8% | 8.6% | -5.0% | -0.8% | 4.3% |
|---|
| Dominion Diamond Corp ($DDC) | | -53.5% | 19.1% | 117.7% | 21.8% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Nevsun Resources Ltd ($NSU) | 90.3% | 89.9% | 94.8% | 95.5% | |
| Franco-Nevada Corp ($FNV) | 84.6% | 86.1% | 85.0% | 83.5% | |
| Labrador Iron Ore Royalty Corp ($LIF) | 80.2% | 80.2% | 80.2% | 80.2% | |
| Lucara Diamond Corp ($LUC) | | 42.5% | 57.4% | 66.7% | |
| Royal Gold Inc ($RGL) | 68.9% | 71.5% | 70.6% | 57.6% | |
| |
|---|
| Median (121 companies) | 29.1% | 31.8% | 22.7% | 17.6% | 32.6% |
|---|
| Dominion Diamond Corp ($DDC) | 37.9% | 21.4% | 22.5% | 13.4% | 25.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Royal Gold Inc ($RGL) | 86.1% | 88.2% | 88.6% | 84.4% | |
| Franco-Nevada Corp ($FNV) | 38.6% | 62.1% | 44.6% | 72.3% | |
| Silver Wheaton Corp ($SLW) | 84.8% | 82.6% | 75.3% | 69.6% | |
| Sandstorm Gold Ltd ($SSL) | 63.8% | 74.3% | 49.9% | 62.1% | |
| Nevsun Resources Ltd ($NSU) | 81.0% | 76.8% | 54.5% | 60.4% | |
| |
|---|
| Median (125 companies) | 23.4% | 18.6% | 13.0% | 9.9% | 14.8% |
|---|
| Dominion Diamond Corp ($DDC) | 23.3% | 40.1% | 37.0% | 25.5% | 42.9% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Barkerville Gold Mines Ltd ($BGM) | 123.7% | 38.5% | 49.9% | 7,166.9% | |
| Imperial Metals Corp ($III) | 28.2% | 69.2% | 185.7% | 280.2% | |
| Golden Minerals Co ($AUM) | 462.4% | 36.9% | 16.8% | 212.8% | |
| Franco-Nevada Corp ($FNV) | 9.3% | 3.7% | 35.5% | 201.6% | |
| HudBay Minerals Inc ($HBM) | 27.7% | 77.7% | 199.9% | 175.5% | |
| |
|---|
| Median (127 companies) | 24.1% | 26.2% | 25.4% | 15.5% | 15.1% |
|---|
| Dominion Diamond Corp ($DDC) | 7.8% | 15.6% | 16.4% | 16.3% | 18.4% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Lucara Diamond Corp ($LUC) | -7.1% | -2.9% | 41.3% | 54.7% | |
| CanAf Group Inc ($CAF) | 74.9% | 37.0% | 65.2% | 37.6% | |
| Nevsun Resources Ltd ($NSU) | 89.8% | 52.2% | 8.8% | 35.0% | |
| Dynacor Gold Mines Inc ($DNG) | 45.6% | 62.8% | 50.9% | 31.3% | |
| Canfor Pulp Products Inc ($CFX) | 103.5% | 4.9% | 13.2% | 21.3% | |
| |
|---|
| Median (130 companies) | 7.3% | 5.7% | 1.5% | 0.8% | -0.6% |
|---|
| Dominion Diamond Corp ($DDC) | 5.1% | 2.8% | 3.9% | 3.6% | 11.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| VMS Ventures Inc ($VMS) | | | | 86.7x | |
| Ur-Energy Inc ($URE) | | | | 55.1x | |
| Katanga Mining Ltd ($KAT) | 0.4x | 19.4x | 3.3x | 18.8x | |
| HudBay Minerals Inc ($HBM) | -2.8x | -4.8x | 2.0x | 14.0x | |
| Imperial Metals Corp ($III) | -0.1x | 1.5x | 4.9x | 12.9x | |
| |
|---|
| Median (88 companies) | -0.1x | 0.3x | 0.7x | 0.9x | -0.3x |
|---|
| Dominion Diamond Corp ($DDC) | 1.5x | 1.9x | -0.4x | -1.2x | -1.0x |
