Pengrowth Energy Corp reports 535% EBITDA decline and 55.0 pp EBITDA Margin decline from 9.8% to -45.2%
24.02.2016 • About Pengrowth Energy Corp (
$PGF) • By InTwits
Pengrowth Energy Corp reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Pengrowth Energy Corp doesn't have a profitable business model yet: 2015 ROIC is -22.2%
- EBITDA Margin is declining: -45.2% in 2015 vs. 9.8% in 2014 vs. 54.5% in 2011
- EBITDA Margin is quite volatile: -45.2% in 2015, 9.8% in 2014, 46.1% in 2013, 51.0% in 2012, 54.5% in 2011
- Pengrowth Energy Corp has high CAPEX intensity: 5 year average CAPEX/Revenue was 49.0%. At the same time it's a lot of higher than industry average of 5.1%.
- CAPEX is quite volatile: 185 in 2015, 921 in 2014, 696 in 2013, 467 in 2012, 617 in 2011
- The company has unprofitable business model: ROIC is at -22.2%
- It operates with high leverage: Net Debt/EBITDA is 6.6x while industry average is 3.9x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Pengrowth Energy Corp ($PGF) key annual financial indicators
| mln. CAD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 1,176 | 1,203 | 1,263 | 1,132 | 1,068 | -5.6% |
| Gross Profit | 768 | 743 | 751 | 686 | 651 | -5.1% |
| SG&A | 75 | 102 | 103 | 100 | 100 | -0.6% |
| EBITDA | 641 | 613 | 582 | 111 | -483 | -535.1% |
| Net Income | 85 | 13 | -317 | -579 | -1,093 | 88.9% |
Balance Sheet
|
|---|
| Cash | 37 | 3 | 449 | 0 | 0 | |
| Short Term Debt | 0 | 50 | 99 | 184 | 4 | -98.0% |
| Long Term Debt | 1,008 | 1,718 | 1,550 | 1,686 | 1,853 | 9.9% |
Cash flow
|
|---|
| Capex | 617 | 467 | 696 | 921 | 185 | -79.9% |
Ratios
|
|---|
| Revenue growth | 5.4% | 2.3% | 5.0% | -10.4% | -5.6% | |
| EBITDA growth | -9.4% | -4.3% | -5.1% | -80.9% | -535.1% | |
| Gross Margin | 65.3% | 61.8% | 59.5% | 60.6% | 60.9% | 0.3% |
| EBITDA Margin | 54.5% | 51.0% | 46.1% | 9.8% | -45.2% | -55.0% |
| Net Income Margin | 7.2% | 1.1% | -25.1% | -51.1% | -102.3% | -51.2% |
| SG&A, % of revenue | 6.4% | 8.5% | 8.1% | 8.9% | 9.3% | 0.5% |
| CAPEX, % of revenue | 52.5% | 38.9% | 55.1% | 81.3% | 17.3% | -64.1% |
| ROIC | 4.1% | 0.5% | -0.2% | -8.1% | -22.2% | -14.2% |
| ROE | 2.6% | 0.3% | -8.0% | -17.5% | -46.6% | -29.1% |
| Net Debt/EBITDA | 1.5x | 2.9x | 2.1x | 16.8x | | -16.8x |
Revenue and profitability
Pengrowth Energy Corp's Revenue decreased on 5.6% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased slightly on 0.87 pp from 3.3% to 4.1% in 2015.
Gross Margin showed almost no change in 2015. SG&A as a % of Revenue showed almost no change in 2015.
Net Income marign dropped on 51.2 pp from -51.1% to -102% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 17.3%. Pengrowth Energy Corp showed big decline in CAPEX/Revenue of 21.6 pp from 38.9% in 2012 to 17.3% in 2015. For the last three years the average CAPEX/Revenue was 51.2%.
Return on investment
The company operates at negative ROIC (-22.24%) and ROE (-46.60%). ROIC dropped on 14.2 pp from -8.1% to -22.2% in 2015. ROE dropped on 29.1 pp from -17.5% to -46.6% in 2015.
Leverage (Debt)
Debt level is 6.6x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA dropped on 16.8x from 16.8x to in 2015. Debt decreased slightly on 0.72% in 2015 while cash didn't change in 2015.
Appendix 1: Peers in Energy
Below we provide Pengrowth Energy Corp benchmarking against other companies in Energy 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 |
|---|
| Petro Rio SA ($PRJ) | -36.3% | -32.1% | -34.9% | 10,977.1% | |
| ONEnergy Inc ($OEG) | | | | 6,002.6% | |
| Sterling Resources Ltd ($SLG) | | -94.8% | 4,514.9% | 2,244.4% | |
| Ikkuma Resources Corp ($IKM) | 22.5% | 17.0% | -4.5% | 1,231.1% | |
| Spartan Energy Corp ($SPE) | -8.2% | 16.6% | 29.9% | 923.7% | |
| |
|---|
| Median (160 companies) | 38.0% | 10.4% | 17.1% | 18.5% | -26.7% |
|---|
| Pengrowth Energy Corp ($PGF) | | 2.3% | 5.0% | -10.4% | -5.6% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| TransAlta Renewables Inc ($RNW) | | | 94.4% | 94.5% | 94.5% |
| Advantage Oil & Gas Ltd ($AAV) | 70.5% | 62.0% | 84.5% | 92.5% | |
| Freehold Royalties Ltd ($FRU) | 91.7% | 90.4% | 89.0% | 90.2% | |
| MEG Energy Corp ($MEG) | 85.5% | 86.8% | 87.4% | 87.6% | 84.1% |
| NXT Energy Solutions Inc ($SFD) | -43.2% | 65.6% | 36.0% | 87.3% | |
| |
|---|
| Median (140 companies) | 33.3% | 29.3% | 31.5% | 29.6% | 30.8% |
|---|
| Pengrowth Energy Corp ($PGF) | 65.3% | 61.8% | 59.5% | 60.6% | 60.9% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Seven Generations Energy Ltd ($VII) | | 56.9% | 54.0% | 106.0% | |
| Tourmaline Oil Corp ($TOU) | 67.4% | 67.9% | 80.0% | 97.6% | |
| Bonavista Energy Corp ($BNP) | 63.8% | 64.6% | 62.6% | 91.6% | |
| Bellatrix Exploration Ltd ($BXE) | 42.7% | 58.6% | 83.6% | 89.6% | |
| Advantage Oil & Gas Ltd ($AAV) | -4.0% | 5.2% | 66.1% | 87.8% | |
| |
|---|
| Median (159 companies) | 24.7% | 25.0% | 30.5% | 29.6% | 5.2% |
|---|
| Pengrowth Energy Corp ($PGF) | 54.5% | 51.0% | 46.1% | 9.8% | -45.2% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Oryx Petroleum Corp Ltd ($OXC) | | | | 1,997.8% | |
| Petroshale Inc ($PSH) | 30.6% | | 346.6% | 865.9% | |
| Toro Oil & Gas Ltd ($TOO) | 192.4% | 139.0% | 39.2% | 808.7% | |
| Athabasca Oil Corp ($ATH) | 176.2% | 2,426.4% | 596.6% | 504.7% | |
| BNK Petroleum Inc ($BKX) | 139.2% | 195.8% | 789.1% | 316.6% | |
| |
|---|
| Median (162 companies) | 42.0% | 50.0% | 39.1% | 47.1% | 21.4% |
|---|
| Pengrowth Energy Corp ($PGF) | 52.5% | 38.9% | 55.1% | 81.3% | 17.3% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Pason Systems Inc ($PSI) | 33.5% | 30.0% | 29.7% | 41.0% | |
| Sea Dragon Energy Inc ($SDX) | -10.1% | 8.1% | 21.8% | 32.9% | |
| Raging River Exploration Inc ($RRX) | | | | 29.1% | |
| High Arctic Energy Services Inc ($HWO) | 27.0% | 31.4% | 26.3% | 24.9% | |
| Rooster Energy Ltd ($COQ) | | | | 22.9% | |
| |
|---|
| Median (165 companies) | 4.5% | 3.5% | 4.6% | 5.1% | -6.5% |
|---|
| Pengrowth Energy Corp ($PGF) | 4.1% | 0.5% | -0.2% | -8.1% | -22.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Veresen Inc ($VSN) | 22.3x | 16.2x | 14.7x | 30.3x | |
| Lightstream Resources Ltd ($LTS) | | 2.0x | | 27.8x | |
| Petroshale Inc ($PSH) | 0.1x | | | 21.7x | |
| Connacher Oil and Gas Ltd ($CLC) | 9.7x | 16.7x | 8.8x | 17.1x | |
| Etrion Corp ($ETX) | 12.5x | 8.2x | 8.3x | 12.8x | |
| |
|---|
| Median (136 companies) | 1.2x | 1.5x | 1.5x | 1.4x | 4.9x |
|---|
| Pengrowth Energy Corp ($PGF) | 1.5x | 2.9x | 2.1x | 16.8x | |
