Horizon North Logistics Inc CAPEX dropped on 52.5% in 2015 and Revenue dropped on 22.3%
24.02.2016 • About Horizon North Logistics Inc (
$HNL) • By InTwits
Horizon North Logistics Inc reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Horizon North Logistics Inc doesn't have a profitable business model yet: 2015 ROIC is 1.1%
- EBITDA Margin is declining: 15.9% in 2015 vs. 19.8% in 2014 vs. 23.0% in 2011
- Horizon North Logistics Inc has high CAPEX intensity: 5 year average CAPEX/Revenue was 21.3%. At the same time it's a lot of higher than industry average of 6.9%.
- CAPEX is quite volatile: 62.5 in 2015, 23.9 in 2014, 36.0 in 2013, 62.0 in 2012, 65.4 in 2011
- The company has potentially unprofitable business model: ROIC is at 1.1%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Horizon North Logistics Inc ($HNL) key annual financial indicators
| mln. CAD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 403.0 | 526.6 | 554.4 | 476.1 | 369.9 | -22.3% |
| Gross Profit | 117.2 | 162.3 | 145.4 | 115.8 | 85.6 | -26.0% |
| SG&A | 14.5 | 17.2 | 19.0 | 22.9 | 23.2 | 1.1% |
| EBITDA | 92.6 | 143.1 | 118.0 | 94.4 | 58.9 | -37.6% |
| Net Income | 44.8 | 72.9 | 42.5 | 23.6 | -0.8 | -103.5% |
Balance Sheet
|
|---|
| Cash | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
| Short Term Debt | 1.3 | 1.4 | 1.5 | 7.7 | 0.0 | -100.0% |
| Long Term Debt | 55.2 | 116.9 | 78.3 | 146.4 | 57.5 | -60.7% |
Cash flow
|
|---|
| Capex | 101.0 | 139.3 | 90.1 | 114.6 | 54.4 | -52.5% |
Ratios
|
|---|
| Revenue growth | 68.4% | 30.7% | 5.3% | -14.1% | -22.3% | |
| EBITDA growth | 80.9% | 54.6% | -17.6% | -20.0% | -37.6% | |
| Gross Margin | 29.1% | 30.8% | 26.2% | 24.3% | 23.1% | -1.2% |
| EBITDA Margin | 23.0% | 27.2% | 21.3% | 19.8% | 15.9% | -3.9% |
| Net Income Margin | 11.1% | 13.8% | 7.7% | 5.0% | -0.2% | -5.2% |
| SG&A, % of revenue | 3.6% | 3.3% | 3.4% | 4.8% | 6.3% | 1.5% |
| CAPEX, % of revenue | 25.1% | 26.5% | 16.3% | 24.1% | 14.7% | -9.3% |
| ROIC | 23.1% | 28.1% | 15.1% | 8.5% | 1.1% | -7.5% |
| ROE | 22.7% | 29.7% | 14.9% | 8.1% | -0.3% | -8.4% |
| Net Debt/EBITDA | 0.6x | 0.8x | 0.7x | 1.6x | 1.0x | -0.7x |
Revenue and profitability
The company's Revenue dropped on 22.3% in 2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 3.9 pp from 19.8% to 15.9% in 2015.
Gross Margin decreased slightly on 1.2 pp from 24.3% to 23.1% in 2015. SG&A as a % of Revenue increased slightly on 1.5 pp from 4.8% to 6.3% in 2015.
Net Income marign decreased on 5.2 pp from 5.0% to -0.22% in 2015.
Capital expenditures (CAPEX) and working capital investments
Horizon North Logistics Inc's CAPEX/Revenue was 14.7% in 2015. Horizon North Logistics Inc showed big decline in CAPEX/Revenue of 11.7 pp from 26.5% in 2012 to 14.7% in 2015. It's average CAPEX/Revenue for the last three years was 18.3%.The company invested a big chunk of EBITDA (92.5%) to CAPEX which didn't stop revenue from falling.
Return on investment
The company operates at low but positive ROIC (1.05%) and negative ROE (-0.27%). ROIC decreased on 7.5 pp from 8.5% to 1.1% in 2015. ROE decreased on 8.4 pp from 8.1% to -0.27% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 1.0x and Debt / EBITDA is 1.0x. Net Debt / EBITDA dropped on 0.7x from 1.6x to 1.0x in 2015. Debt dropped on 62.7% in 2015 while cash didn't change in 2015.
Management team
Horizon North Logistics Inc's CEO is Roderick W Graham "Rod". Roderick W Graham "Rod" is a founder and has 4 years tenure at the company. Horizon North Logistics Inc's CFO Scott Matson has spent 8 years at the company.
Appendix 1: Peers in Industrial
Below you can find Horizon North Logistics Inc benchmarking vs. other companies in Industrial 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 |
|---|
| Electrovaya Inc ($EFL) | | -4.0% | -71.2% | 160.5% | 123.8% |
| Enterprise Group Inc ($E) | 14.5% | 3.5% | 88.3% | 128.5% | |
| Carmanah Technologies Corp ($CMH) | 5.8% | -26.4% | -2.0% | 68.8% | |
| Exco Technologies Ltd ($XTC) | | 19.7% | 0.9% | 50.5% | 35.3% |
| Lumenpulse Inc ($LMP) | | 56.7% | 33.9% | 47.0% | 61.8% |
| |
|---|
| Median (92 companies) | 12.4% | 10.4% | 4.9% | 9.4% | 8.3% |
|---|
| Horizon North Logistics Inc ($HNL) | | 30.7% | 5.3% | -14.1% | -22.3% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| WSP Global Inc ($WSP) | 81.1% | 81.1% | 83.2% | 81.0% | |
| Pure Technologies Ltd ($PUR) | 75.7% | 77.9% | 78.0% | 77.5% | |
| Alarmforce Industries Inc ($AF) | 76.4% | 75.0% | 76.5% | 72.2% | 69.2% |
| Epicore BioNetworks Inc ($EBN) | 59.0% | 60.8% | 63.2% | 64.1% | 58.1% |
| FLYHT Aerospace Solutions Ltd ($FLY) | 54.0% | 57.2% | 59.2% | 62.9% | |
| |
|---|
| Median (88 companies) | 23.2% | 23.0% | 23.3% | 22.6% | 25.0% |
|---|
| Horizon North Logistics Inc ($HNL) | 29.1% | 30.8% | 26.2% | 24.3% | 23.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Canadian National Railway Co ($CNR) | 46.3% | 46.5% | 45.9% | 46.8% | 50.9% |
| Canadian Pacific Railway Ltd ($CP) | 28.1% | 26.1% | 32.4% | 43.7% | 48.9% |
| Vitreous Glass Inc ($VCI) | 29.0% | 31.4% | 32.2% | 37.8% | 39.0% |
| Questor Technology Inc ($QST) | 25.1% | 25.7% | 34.9% | 34.1% | |
| Progressive Waste Solutions Ltd ($BIN) | 32.2% | 30.7% | 33.1% | 34.0% | 9.8% |
| |
|---|
| Median (85 companies) | 8.1% | 9.2% | 8.3% | 7.2% | 9.8% |
|---|
| Horizon North Logistics Inc ($HNL) | 23.0% | 27.2% | 21.3% | 19.8% | 15.9% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Cargojet Inc ($CJT.A) | 6.8% | 7.0% | 6.3% | 54.1% | |
| Newalta Corp ($NAL) | 17.2% | 21.7% | 34.5% | 35.1% | |
| Enterprise Group Inc ($E) | 3.6% | 17.4% | 27.2% | 32.7% | |
| ENTREC Corp ($ENT) | | 35.0% | 26.7% | 29.5% | |
| Badger Daylighting Ltd ($BAD) | 19.2% | 22.6% | 21.7% | 23.5% | |
| |
|---|
| Median (92 companies) | 2.4% | 3.0% | 3.5% | 3.1% | 3.7% |
|---|
| Horizon North Logistics Inc ($HNL) | 25.1% | 26.5% | 16.3% | 24.1% | 14.7% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Vitreous Glass Inc ($VCI) | 26.1% | 30.5% | 32.3% | 48.3% | 51.0% |
| Photon Control Inc ($PHO) | 10.1% | 21.0% | 44.4% | 38.0% | |
| SNC-Lavalin Group Inc ($SNC) | 14.6% | 10.7% | 4.0% | 35.2% | |
| Alarmforce Industries Inc ($AF) | 18.3% | 5.3% | 24.0% | 33.9% | 19.0% |
| Epicore BioNetworks Inc ($EBN) | 24.8% | 28.1% | 16.1% | 32.5% | 26.3% |
| |
|---|
| Median (93 companies) | 8.9% | 9.3% | 8.5% | 9.1% | 9.4% |
|---|
| Horizon North Logistics Inc ($HNL) | 23.1% | 28.1% | 15.1% | 8.5% | 1.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Sigma Industries Inc ($SSG) | | 4.4x | 11.3x | 225.9x | 2.9x |
| H2O Innovation Inc ($HEO) | | | 4.2x | 73.2x | 1.6x |
| Grand Power Logistics Group Inc ($GPW) | | 47.8x | | 53.1x | |
| Cargojet Inc ($CJT.A) | 1.8x | 1.5x | 1.5x | 31.5x | |
| IBI Group Inc ($IBG) | 4.2x | 6.5x | | 8.3x | |
| |
|---|
| Median (72 companies) | 1.1x | 1.5x | 1.5x | 1.2x | 1.6x |
|---|
| Horizon North Logistics Inc ($HNL) | 0.6x | 0.8x | 0.7x | 1.6x | 1.0x |
