Bank of Montreal revenue increased on 4.3% in 2015
01.12.2015 • About Bank of Montreal (
$BMO) • By InTwits
Bank of Montreal reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Bank of Montreal has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.5%. At the same time it's in pair with industry average of 4.9%.
- CAPEX is quite volatile: 7,273 in 2015, 10,524 in 2014, 8,235 in 2013, 5,194 in 2012, 3,508 in 2011
- The company has potentially unprofitable business model: ROIC is at 6.3%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Bank of Montreal ($BMO) key annual financial indicators
| mln. CAD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 18,993 | 20,967 | 20,651 | 22,803 | 23,784 | 4.3% |
| Net Income | 3,041 | 4,115 | 4,130 | 4,277 | 4,370 | 2.2% |
Balance Sheet
|
|---|
| Cash | 19,676 | 19,941 | 26,089 | 28,386 | 40,295 | 42.0% |
| Short Term Debt | 20,207 | 23,439 | 22,446 | 27,348 | 21,226 | -22.4% |
| Long Term Debt | 6,169 | 4,555 | 3,996 | 4,913 | 4,416 | -10.1% |
Cash flow
|
|---|
| Capex | 368 | 366 | 361 | 355 | 179 | -49.6% |
Ratios
|
|---|
| Revenue growth | 22.9% | 10.4% | -1.5% | 10.4% | 4.3% | |
| Net Income Margin | 16.0% | 19.6% | 20.0% | 18.8% | 18.4% | -0.4% |
| CAPEX, % of revenue | 1.9% | 1.7% | 1.7% | 1.6% | 0.8% | -0.8% |
| ROIC | 4.4% | 5.5% | 5.7% | 7.0% | 6.3% | -0.8% |
| ROE | 13.5% | 16.0% | 14.8% | 14.1% | 12.6% | -1.5% |
Revenue and profitability
The company's Revenue increased on 4.3% in FY2015.
Net Income marign showed almost no change in FY2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 0.75% in FY2015. Bank of Montreal's CAPEX/Revenue decreased slightly on 0.99 pp from 1.7% in FY2012 to 0.75% in FY2015. Average CAPEX/Revenue for the last three years was 1.4%.
Return on investment
The company operates at good ROE (12.61%) while ROIC is low (6.26%). ROIC decreased slightly on 0.78 pp from 7.0% to 6.3% in FY2015. ROE decreased slightly on 1.5 pp from 14.1% to 12.6% in FY2015.
Leverage (Debt)
Debt dropped on 20.5% in FY2015 while cash jumped on 42.0% in FY2015.
Management team
William Downe is a Bank of Montreal's CEO. William Downe has spent 11 years at the company. Bank of Montreal's CFO Thomas E Flynn "Tom" has spent 11 years at the company.
Appendix 1: Peers in Financial
Below you can find Bank of Montreal benchmarking vs. other companies in Financial 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 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Westaim Corp/The ($WED) | 35.7% | -99.9% | 38.0% | 5,680.8% | |
| Wall Financial Corp ($WFC) | | 35.2% | -74.1% | 285.4% | -75.3% |
| Element Financial Corp ($EFN) | | | 206.6% | 189.1% | |
| DealNet Capital Corp ($DLS) | -73.3% | 4,437.5% | 540.4% | 112.7% | |
| Gluskin Sheff + Associates Inc ($GS) | | -39.1% | 60.6% | 97.9% | -33.5% |
| |
|---|
| Median (72 companies) | 11.2% | 7.7% | 7.2% | 8.4% | -13.6% |
|---|
| Bank of Montreal ($BMO) | | 10.4% | -1.5% | 10.4% | 4.3% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Olympia Financial Group Inc ($OLY) | 85.3% | 80.9% | 82.6% | 83.2% | |
| Morguard Corp ($MRC) | 74.8% | 74.0% | 69.9% | 68.6% | |
| DealNet Capital Corp ($DLS) | | 14.9% | 36.7% | 45.6% | |
| Brookfield Asset Management Inc ($BAM.A) | 34.3% | 25.6% | 30.7% | 28.6% | |
| Onex Corp ($OCX) | 20.0% | 20.1% | 26.2% | 27.9% | |
| |
|---|
| Median (11 companies) | 25.2% | 22.6% | 25.7% | 20.5% | 16.9% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Firm Capital Mortgage Investment Corp ($FC) | 88.7% | 87.6% | 87.9% | 88.8% | |
| Equitable Group Inc ($EQB) | 89.7% | 88.1% | 87.4% | 86.0% | |
| Alaris Royalty Corp ($AD) | 97.0% | 81.3% | 61.8% | 81.8% | |
| Brookfield Real Estate Services Inc ($BRE) | 77.1% | 77.7% | 77.9% | 78.4% | |
| First National Financial Corp ($FN) | 66.1% | 67.8% | 76.5% | 77.1% | |
| |
|---|
| Median (49 companies) | 35.6% | 32.3% | 32.1% | 31.5% | 47.9% |
|---|
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Killam Properties Inc ($KMP) | 73.6% | 80.7% | 114.1% | 143.5% | |
| Dundee Corp ($DC.A) | | 10.3% | 14.1% | 88.8% | 123.6% |
| StorageVault Canada Inc ($SVI) | 29.6% | 150.5% | 73.3% | 79.1% | |
| Mainstreet Equity Corp ($MEQ) | 152.4% | 115.8% | 62.3% | 75.8% | |
| First Capital Realty Inc ($FCR) | 102.8% | 127.9% | 76.1% | 73.8% | |
| |
|---|
| Median (74 companies) | 1.3% | 1.4% | 0.8% | 1.0% | 3.3% |
|---|
| Bank of Montreal ($BMO) | 1.9% | 1.7% | 1.7% | 1.6% | 0.8% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Gluskin Sheff + Associates Inc ($GS) | 71.3% | 21.0% | 82.9% | 153.9% | 63.6% |
| Brookfield Real Estate Services Inc ($BRE) | 17.1% | 26.0% | 31.0% | 47.0% | |
| Redishred Capital Corp ($KUT) | -3.9% | -24.5% | 6.5% | 15.8% | |
| IGM Financial Inc ($IGM) | 15.3% | 14.2% | 14.2% | 13.7% | |
| Street Capital Group Inc ($SCB) | 2.3% | 10.9% | 11.0% | 13.4% | |
| |
|---|
| Median (76 companies) | 5.3% | 4.8% | 4.5% | 4.8% | 5.0% |
|---|
| Bank of Montreal ($BMO) | 4.4% | 5.5% | 5.7% | 7.0% | 6.3% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| First National Financial Corp ($FN) | 37.6x | 34.3x | 33.7x | 40.9x | |
| Element Financial Corp ($EFN) | | 140.2x | 31.9x | 37.6x | |
| Gazit-Globe Ltd ($GZT) | 14.8x | 12.8x | 12.7x | 15.3x | |
| Morguard Corp ($MRC) | 7.5x | 8.9x | | 14.2x | |
| StorageVault Canada Inc ($SVI) | 6.0x | 11.2x | 9.7x | 13.6x | |
| |
|---|
| Median (41 companies) | 5.3x | 5.3x | 4.8x | 4.3x | 6.6x |
|---|
