CanAf Group Inc reports 1,115% CAPEX growth while 30.9% Revenue decline
23.02.2016 • About CanAf Group Inc (
$CAF) • By InTwits
CanAf Group Inc reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- CanAf Group Inc is a company in decline: FY2015 revenue growth was -30.9%, 5 years revenue CAGR was -5.0%
- CanAf Group Inc has medium CAPEX intensity: 5 year average CAPEX/Revenue was 5.1%. At the same time it's in pair with industry average of 1.8%.
- CAPEX is quite volatile: 1.4 in FY2015, 0.12 in FY2014, 0.24 in FY2013, 0.44 in FY2012, 0.39 in FY2011
- The company has highly profitable business model: ROIC is at 13.8%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
CanAf Group Inc ($CAF) key annual financial indicators
| mln. $ | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 13.337 | 10.882 | 14.970 | 13.257 | 9.157 | -30.9% |
| Gross Profit | 1.666 | 1.102 | 1.642 | 1.272 | 0.791 | -37.8% |
| SG&A | | | | | 0.459 | |
| EBITDA | 1.480 | 0.755 | 1.206 | 0.899 | 0.677 | -24.8% |
| Net Income | 0.575 | 0.328 | 0.839 | 0.412 | 0.128 | -68.9% |
Balance Sheet
|
|---|
| Cash | 0.209 | 1.429 | 1.314 | 0.454 | 0.881 | 94.1% |
| Short Term Debt | 0.040 | 0.039 | 0.177 | 0.000 | 0.341 | |
| Long Term Debt | 0.229 | 0.032 | 0.000 | 0.000 | 0.609 | |
Cash flow
|
|---|
| Capex | 0.386 | 0.443 | 0.235 | 0.119 | 1.449 | 1,115.0% |
Ratios
|
|---|
| Revenue growth | 13.0% | -18.4% | 37.6% | -11.4% | -30.9% | |
| EBITDA growth | -23.1% | -49.0% | 59.7% | -25.4% | -24.8% | |
| Gross Margin | 12.5% | 10.1% | 11.0% | 9.6% | 8.6% | -1.0% |
| EBITDA Margin | 11.1% | 6.9% | 8.1% | 6.8% | 7.4% | 0.6% |
| Net Income Margin | 4.3% | 3.0% | 5.6% | 3.1% | 1.4% | -1.7% |
| SG&A, % of revenue | | | | | 5.0% | 5.0% |
| CAPEX, % of revenue | 2.9% | 4.1% | 1.6% | 0.9% | 15.8% | 14.9% |
| ROIC | 74.9% | 37.0% | 65.2% | 37.6% | 13.8% | -23.8% |
| ROE | 65.4% | 30.0% | 58.4% | 22.7% | 7.2% | -15.5% |
| Net Debt/EBITDA | 0.0x | -1.8x | -0.9x | -0.5x | 0.1x | 0.6x |
Revenue and profitability
CanAf Group Inc's Revenue dropped on 30.9% in FY2015. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased slightly on 0.61 pp from 6.8% to 7.4% in FY2015.
Gross Margin decreased slightly on 0.95 pp from 9.6% to 8.6% in FY2015.
Net Income marign decreased slightly on 1.7 pp from 3.1% to 1.4% in FY2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 15.8% in FY2015. The company's CAPEX/Revenue surged on 11.7 pp from 4.1% in FY2012 to 15.8% in FY2015. It's average CAPEX/Revenue for the last three years was 6.1%.Battling declining revenue CanAf Group Inc made large investments to CAPEX (214% of EBITDA) but that didn't help at least in this year.
Return on investment
The company operates at good ROIC (13.81%) while ROE is low (7.24%). ROIC dropped on 23.8 pp from 37.6% to 13.8% in FY2015. ROE dropped on 15.5 pp from 22.7% to 7.2% in FY2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 0.1x and Debt / EBITDA is 1.4x. Net Debt / EBITDA surged on 0.6x from -0.5x to 0.1x in FY2015. Debt surged while cash surged on 94.1% in FY2015.
Appendix 1: Peers in Basic Materials
Below we provide CanAf Group Inc 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% |
| Asian Mineral Resources Ltd ($ASN) | | | | 859.1% | |
| Ur-Energy Inc ($URE) | | | | 285.4% | |
| Nevsun Resources Ltd ($NSU) | | 3.3% | -72.5% | 256.5% | |
| |
|---|
| Median (130 companies) | 31.3% | 8.5% | -5.1% | -0.8% | -4.0% |
|---|
| CanAf Group Inc ($CAF) | | -18.4% | 37.6% | -11.4% | -30.9% |
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% | 60.9% |
| Royal Gold Inc ($RGL) | 68.9% | 71.5% | 70.6% | 57.6% | 86.0% |
| |
|---|
| Median (133 companies) | 31.2% | 32.0% | 21.8% | 17.6% | 15.4% |
|---|
| CanAf Group Inc ($CAF) | 12.5% | 10.1% | 11.0% | 9.6% | 8.6% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Royal Gold Inc ($RGL) | 86.1% | 88.2% | 88.6% | 84.4% | 65.0% |
| Franco-Nevada Corp ($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 ($NSU) | 81.0% | 76.8% | 54.5% | 60.4% | |
| |
|---|
| Median (137 companies) | 23.3% | 18.6% | 11.7% | 9.9% | 6.9% |
|---|
| CanAf Group Inc ($CAF) | 11.1% | 6.9% | 8.1% | 6.8% | 7.4% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Barkerville Gold Mines Ltd ($BGM) | 123.7% | 38.5% | 49.9% | 7,166.9% | 3.2% |
| Marlin Gold Mining Ltd ($MLN) | | | | 508.8% | |
| 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 ($FNV) | 9.3% | 3.7% | 35.5% | 201.6% | |
| |
|---|
| Median (139 companies) | 24.1% | 26.3% | 25.5% | 16.3% | 11.7% |
|---|
| CanAf Group Inc ($CAF) | 2.9% | 4.1% | 1.6% | 0.9% | 15.8% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Lucara Diamond Corp ($LUC) | -7.1% | -2.9% | 41.3% | 54.7% | 39.6% |
| Nevsun Resources Ltd ($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% | 24.1% |
| Almonty Industries Inc ($AII) | | 22.1% | 1.6% | 20.1% | -22.0% |
| |
|---|
| Median (143 companies) | 5.4% | 4.9% | -0.1% | -0.1% | -3.5% |
|---|
| CanAf Group Inc ($CAF) | 74.9% | 37.0% | 65.2% | 37.6% | 13.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| VMS Ventures Inc ($VMS) | | | | 86.7x | 4.7x |
| Ur-Energy Inc ($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 ($III) | -0.1x | 1.5x | 4.9x | 12.9x | |
| |
|---|
| Median (94 companies) | -0.1x | 0.3x | 0.9x | 0.9x | 1.6x |
|---|
| CanAf Group Inc ($CAF) | 0.0x | -1.8x | -0.9x | -0.5x | 0.1x |
