Canadian Tire Corp Ltd EBITDA jumped on 10.3% in 2015 and EBITDA Margin increased slightly on 1.3 pp from 11.0% to 12.4%
18.02.2016 • About Canadian Tire Corp Ltd (
$CTC) • By InTwits
Canadian Tire Corp Ltd reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is expanding: 12.4% in FY2015 vs. 11.0% in FY2014 vs. 10.2% in FY2011
- Canadian Tire Corp Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 3.2%. At the same time it's a lot of higher than industry average of 8.1%.
- CAPEX is quite volatile: 516 in FY2015, 539 in FY2014, 404 in FY2013, 222 in FY2012, 231 in FY2011
- The company has business model with average profitability: ROIC is at 12.0%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Canadian Tire Corp Ltd ($CTC) key annual financial indicators
| mln. CAD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 10,387 | 11,427 | 11,786 | 12,463 | 12,280 | -1.5% |
| Gross Profit | 3,061 | 3,498 | 3,722 | 4,046 | 4,135 | 2.2% |
| SG&A | 1,988 | 2,344 | 2,829 | 3,053 | 3,096 | 1.4% |
| EBITDA | 1,058 | 1,138 | 1,236 | 1,376 | 1,519 | 10.3% |
| Net Income | 467 | 499 | 561 | 604 | 659 | 9.2% |
Balance Sheet
|
|---|
| Cash | 326 | 1,016 | 643 | 662 | 901 | 36.0% |
| Short Term Debt | 1,134 | 1,491 | 1,073 | 1,406 | 113 | -92.0% |
| Long Term Debt | 2,348 | 2,336 | 2,339 | 2,132 | 2,971 | 39.4% |
Cash flow
|
|---|
| Capex | 231 | 222 | 404 | 539 | 516 | -4.2% |
Ratios
|
|---|
| Revenue growth | 12.7% | 10.0% | 3.1% | 5.7% | -1.5% | |
| EBITDA growth | 6.2% | 7.6% | 8.6% | 11.4% | 10.3% | |
| Gross Margin | 29.5% | 30.6% | 31.6% | 32.5% | 33.7% | 1.2% |
| EBITDA Margin | 10.2% | 10.0% | 10.5% | 11.0% | 12.4% | 1.3% |
| Net Income Margin | 4.5% | 4.4% | 4.8% | 4.8% | 5.4% | 0.5% |
| SG&A, % of revenue | 19.1% | 20.5% | 24.0% | 24.5% | 25.2% | 0.7% |
| CAPEX, % of revenue | 2.2% | 1.9% | 3.4% | 4.3% | 4.2% | -0.1% |
| ROIC | 9.8% | 9.7% | 10.1% | 11.0% | 12.0% | 1.0% |
| ROE | 11.1% | 10.9% | 11.3% | 12.1% | 13.4% | 1.3% |
| Net Debt/EBITDA | 3.0x | 2.5x | 2.2x | 2.1x | 1.4x | -0.7x |
Revenue and profitability
The company's Revenue decreased slightly on 1.5% in FY2015. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased slightly on 1.3 pp from 11.0% to 12.4% in FY2015.
Gross Margin increased slightly on 1.2 pp from 32.5% to 33.7% in FY2015. SG&A as a % of Revenue increased slightly on 0.72 pp from 24.5% to 25.2% in FY2015.
Net Income marign increased slightly on 0.52 pp from 4.8% to 5.4% in FY2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 4.2% in FY2015. The company showed CAPEX/Revenue growth of 2.3 pp from 1.9% in FY2012 to 4.2% in FY2015. It's average level of CAPEX/Revenue for the last three years was 4.0%.
Return on investment
The company operates at good ROE (13.39%) while ROIC is low (11.97%). ROIC increased slightly on 0.98 pp from 11.0% to 12.0% in FY2015. ROE increased slightly on 1.3 pp from 12.1% to 13.4% in FY2015.
Leverage (Debt)
Debt level is 1.4x Net Debt / EBITDA and 2.0x Debt / EBITDA. Net Debt / EBITDA dropped on 0.7x from 2.1x to 1.4x in FY2015. Debt dropped on 12.8% in FY2015 while cash jumped on 36.0% in FY2015.
Management team
Stephen G Wetmore is a the company's CEO. Stephen G Wetmore is a founder and has spent 9 years at the company. Canadian Tire Corp Ltd's CFO Dean Charles Mccann has spent 6 years at the company.
Appendix 1: Peers in Consumer, Cyclical
Below you can find Canadian Tire Corp Ltd benchmarking vs. other companies in Consumer, Cyclical 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 |
|---|
| 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 ($HLC) | 5.4% | -24.6% | 2.7% | 62.7% | |
| |
|---|
| Median (67 companies) | 12.6% | 5.3% | 5.3% | 7.7% | 3.3% |
|---|
| Canadian Tire Corp Ltd ($CTC) | | 10.0% | 3.1% | 5.7% | -1.5% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Restaurant Brands International Inc ($QSR) | | | 69.7% | 87.0% | 42.9% |
| Imvescor Restaurant Group Inc ($IRG) | 96.2% | 94.2% | 89.7% | 84.9% | 84.3% |
| 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 ($BCI) | 72.3% | 71.8% | 72.6% | 72.6% | |
| |
|---|
| Median (59 companies) | 37.9% | 36.5% | 32.1% | 34.6% | 36.9% |
|---|
| Canadian Tire Corp Ltd ($CTC) | 29.5% | 30.6% | 31.6% | 32.5% | 33.7% |
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 ($MTY) | 32.2% | 36.3% | 38.7% | 37.0% | 34.9% |
| |
|---|
| Median (65 companies) | 8.4% | 7.9% | 9.7% | 9.6% | 9.4% |
|---|
| Canadian Tire Corp Ltd ($CTC) | 10.2% | 10.0% | 10.5% | 11.0% | 12.4% |
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% | 22.5% |
| 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 ($KLS) | 79.2% | 0.4% | 0.7% | 13.5% | |
| |
|---|
| Median (68 companies) | 2.9% | 2.7% | 2.7% | 2.2% | 2.7% |
|---|
| Canadian Tire Corp Ltd ($CTC) | 2.2% | 1.9% | 3.4% | 4.3% | 4.2% |
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 ($IPC) | -35.4% | 23.0% | 58.5% | 33.6% | 10.9% |
| |
|---|
| Median (68 companies) | 10.7% | 9.8% | 10.8% | 9.7% | 9.4% |
|---|
| Canadian Tire Corp Ltd ($CTC) | 9.8% | 9.7% | 10.1% | 11.0% | 12.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Mountain China Resorts Holding Ltd ($MCG) | | | | 317.1x | |
| Restaurant Brands International Inc ($QSR) | | | 3.8x | 33.6x | 5.8x |
| Allied Hotel Properties Inc ($AHP) | | | | 21.3x | |
| Hudson's Bay Co ($HBC) | 8.7x | 3.8x | 3.6x | 19.1x | 3.6x |
| Amaya Inc ($AYA) | | 17.9x | 1.8x | 13.5x | |
| |
|---|
| Median (57 companies) | 1.3x | 1.2x | 1.6x | 1.9x | 1.1x |
|---|
| Canadian Tire Corp Ltd ($CTC) | 3.0x | 2.5x | 2.2x | 2.1x | 1.4x |
