Gildan Activewear Inc reports 21.7% CAPEX decline while 8.8% Revenue growth
24.02.2016 • About Gildan Activewear Inc (
$GIL) • By InTwits
Gildan Activewear Inc reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Gildan Activewear Inc is a growth stock: FY2015 revenue growth was 8.8%, 5 year revenue CAGR was 14.4% at FY2015 ROIC 15.5%
- Gildan Activewear Inc has medium CAPEX intensity: 5 year average CAPEX/Revenue was 8.2%. At the same time it's a lot of higher than industry average of 4.9%.
- CAPEX is quite volatile: 224 in FY2015, 287 in FY2014, 163 in FY2013, 71.3 in FY2012, 155 in FY2011
- The company has highly profitable business model: ROIC is at 15.5%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Gildan Activewear Inc ($GIL) key annual financial indicators
| mln. $ | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 1,726 | 1,948 | 2,184 | 2,360 | 2,569 | 8.8% |
| Gross Profit | 438 | 396 | 634 | 659 | 687 | 4.3% |
| SG&A | 199 | 226 | 283 | 286 | 308 | 7.8% |
| EBITDA | 295 | 250 | 438 | 465 | 492 | 5.9% |
| Net Income | 234 | 148 | 320 | 360 | 346 | -3.7% |
Balance Sheet
|
|---|
| Cash | 82 | 70 | 97 | 65 | 51 | -22.2% |
| Short Term Debt | 0 | 0 | 0 | 0 | 0 | |
| Long Term Debt | 209 | 181 | 0 | 157 | 375 | 138.9% |
Cash flow
|
|---|
| Capex | 155 | 71 | 163 | 287 | 224 | -21.7% |
Ratios
|
|---|
| Revenue growth | 31.6% | 12.9% | 12.1% | 8.0% | 8.8% | |
| EBITDA growth | 10.2% | -15.3% | 75.4% | 6.2% | 5.9% | |
| Gross Margin | 25.4% | 20.3% | 29.0% | 27.9% | 26.8% | -1.2% |
| EBITDA Margin | 17.1% | 12.8% | 20.1% | 19.7% | 19.2% | -0.5% |
| Net Income Margin | 13.6% | 7.6% | 14.7% | 15.2% | 13.5% | -1.8% |
| SG&A, % of revenue | 11.5% | 11.6% | 12.9% | 12.1% | 12.0% | -0.1% |
| CAPEX, % of revenue | 9.0% | 3.7% | 7.4% | 12.1% | 8.7% | -3.4% |
| ROIC | 16.5% | 9.9% | 20.6% | 18.9% | 15.5% | -3.4% |
| ROE | 19.3% | 10.8% | 20.4% | 19.2% | 16.4% | -2.8% |
| Net Debt/EBITDA | 0.4x | 0.4x | -0.2x | 0.2x | 0.7x | 0.5x |
Revenue and profitability
The company's Revenue increased on 8.8% in FY2015. Revenue growth was financed by EBITDA margin decline. EBITDA Margin decreased slightly on 0.53 pp from 19.7% to 19.2% in FY2015.
Gross Margin decreased slightly on 1.2 pp from 27.9% to 26.8% in FY2015. SG&A as a % of Revenue showed almost no change in FY2015.
Net Income marign decreased slightly on 1.8 pp from 15.2% to 13.5% in FY2015.
Capital expenditures (CAPEX) and working capital investments
In FY2015 the company had CAPEX/Revenue of 8.7%. CAPEX/Revenue increased on 5.1 pp from 3.7% in FY2012 to 8.7% in FY2015. It's average CAPEX/Revenue for the last three years was 9.4%.
Return on investment
The company operates at good ROIC (15.47%) and ROE (16.44%). ROIC decreased on 3.4 pp from 18.9% to 15.5% in FY2015. ROE decreased on 2.8 pp from 19.2% to 16.4% in FY2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 0.7x and Debt / EBITDA is 0.8x. Net Debt / EBITDA surged on 0.5x from 0.2x to 0.7x in FY2015. Debt jumped on 139% in FY2015 while cash dropped on 22.2% in FY2015.
Management team
Glenn J Chamandy is a Gildan Activewear Inc's CEO. Glenn J Chamandy is a founder and has spent 14 years at the company. Rhodri J Harries is a The company's CFO. Rhodri J Harries has spent 3 years at the company.
Appendix 1: Peers in Consumer, Cyclical
Below you can find Gildan Activewear Inc 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 ($HLC) | 5.4% | -24.6% | 2.7% | 62.7% | |
| |
|---|
| Median (67 companies) | 9.3% | 5.3% | 4.9% | 7.2% | 3.3% |
|---|
| Gildan Activewear Inc ($GIL) | | 12.9% | 12.1% | 8.0% | 8.8% |
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% | 81.1% |
| New Look Vision Group Inc ($BCI) | 72.3% | 71.8% | 72.6% | 72.6% | |
| |
|---|
| Median (59 companies) | 37.9% | 36.5% | 32.1% | 34.6% | 36.8% |
|---|
| Gildan Activewear Inc ($GIL) | 25.4% | 20.3% | 29.0% | 27.9% | 26.8% |
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 ($MTY) | 32.2% | 36.3% | 38.7% | 37.0% | 34.9% |
| |
|---|
| Median (65 companies) | 8.4% | 7.9% | 9.7% | 9.6% | 10.0% |
|---|
| Gildan Activewear Inc ($GIL) | 17.1% | 12.8% | 20.1% | 19.7% | 19.2% |
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 ($EIF) | 8.2% | 7.9% | 15.8% | 15.5% | 15.4% |
| Holloway Lodging Corp ($HLC) | 3.4% | 8.2% | 6.7% | 14.8% | |
| Kelso Technologies Inc ($KLS) | 79.2% | 0.4% | 0.7% | 13.5% | |
| |
|---|
| Median (68 companies) | 2.6% | 2.7% | 2.7% | 2.2% | 2.9% |
|---|
| Gildan Activewear Inc ($GIL) | 9.0% | 3.7% | 7.4% | 12.1% | 8.7% |
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 ($IPC) | -35.4% | 23.0% | 58.5% | 33.6% | 10.9% |
| |
|---|
| Median (68 companies) | 10.4% | 9.7% | 10.1% | 9.7% | 11.0% |
|---|
| Gildan Activewear Inc ($GIL) | 16.5% | 9.9% | 20.6% | 18.9% | 15.5% |
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 ($AYA) | | 17.9x | 1.8x | 13.5x | |
| |
|---|
| Median (57 companies) | 1.3x | 1.4x | 1.8x | 2.0x | 1.6x |
|---|
| Gildan Activewear Inc ($GIL) | 0.4x | 0.4x | -0.2x | 0.2x | 0.7x |
