Aecon Group Inc EBITDA jumped on 65.5% in 2015 and EBITDA Margin increased on 2.4 pp from 4.9% to 7.2%
01.03.2016 • About Aecon Group Inc (
$ARE) • By InTwits
Aecon Group Inc reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Aecon Group Inc has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.5%. At the same time it's in pair with industry average of 88.7%.
- CAPEX is quite volatile: 30.3 in 2015, 28.5 in 2014, 45.7 in 2013, 51.0 in 2012, 64.3 in 2011
- The company has highly profitable business model: ROIC is at 12.6%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Aecon Group Inc ($ARE) key annual financial indicators
| mln. CAD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 2,896 | 2,887 | 3,069 | 2,614 | 2,918 | 11.6% |
| Gross Profit | 274 | 279 | 270 | 271 | 298 | 10.0% |
| SG&A | 139 | 158 | 148 | 164 | 170 | 3.8% |
| EBITDA | 163 | 178 | 160 | 127 | 211 | 65.5% |
| Net Income | 58 | 78 | 41 | 30 | 69 | 128.6% |
Balance Sheet
|
|---|
| Cash | 175 | 63 | 241 | 139 | 283 | 103.5% |
| Short Term Debt | 122 | 72 | 241 | 174 | 56 | -67.8% |
| Long Term Debt | 531 | 399 | 372 | 271 | 266 | -1.7% |
Cash flow
|
|---|
| Capex | 64 | 51 | 46 | 28 | 30 | 6.4% |
Ratios
|
|---|
| Revenue growth | 5.3% | -0.3% | 6.3% | -14.8% | 11.6% | |
| EBITDA growth | 54.5% | 9.1% | -9.9% | -20.6% | 65.5% | |
| Gross Margin | 9.5% | 9.7% | 8.8% | 10.4% | 10.2% | -0.2% |
| EBITDA Margin | 5.6% | 6.2% | 5.2% | 4.9% | 7.2% | 2.4% |
| Net Income Margin | 2.0% | 2.7% | 1.3% | 1.1% | 2.4% | 1.2% |
| SG&A, % of revenue | 4.8% | 5.5% | 4.8% | 6.3% | 5.8% | -0.4% |
| CAPEX, % of revenue | 2.2% | 1.8% | 1.5% | 1.1% | 1.0% | -0.1% |
| ROIC | 8.2% | 10.4% | 8.4% | 5.3% | 12.6% | 7.2% |
| ROE | 12.3% | 15.1% | 7.2% | 4.8% | 10.0% | 5.2% |
| Net Debt/EBITDA | 2.9x | 2.3x | 2.3x | 2.4x | 0.2x | -2.2x |
Revenue and profitability
The company's Revenue surged on 11.6% in 2015. Revenue growth happened at the same time with EBITDA margin expansion. EBITDA Margin increased on 2.4 pp from 4.9% to 7.2% 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 increased slightly on 1.2 pp from 1.1% to 2.4% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 Aecon Group Inc had CAPEX/Revenue of 1.0%. CAPEX/Revenue decreased slightly on 0.73 pp from 1.8% in 2012 to 1.0% in 2015. It's average level of CAPEX/Revenue for the last three years was 1.2%.
Return on investment
The company operates at good ROIC (12.58%) while ROE is low (10.00%). ROIC increased on 7.2 pp from 5.3% to 12.6% in 2015. ROE increased on 5.2 pp from 4.8% to 10.0% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 0.2x and Debt / EBITDA is 1.5x. Net Debt / EBITDA dropped on 2.2x from 2.4x to 0.2x in 2015. Debt dropped on 27.5% in 2015 while cash jumped on 104% in 2015.
Appendix 1: Peers in Industrial
Below we provide Aecon Group Inc benchmarking against other companies in Industrial 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 |
|---|
| 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 ($LMP) | | 56.7% | 33.9% | 47.0% | 61.8% |
| |
|---|
| Median (92 companies) | 11.3% | 11.5% | 4.9% | 9.4% | 8.1% |
|---|
| Aecon Group Inc ($ARE) | | -0.3% | 6.3% | -14.8% | 11.6% |
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 ($FLY) | 54.0% | 57.2% | 59.2% | 62.9% | |
| |
|---|
| Median (88 companies) | 23.4% | 23.4% | 23.4% | 23.1% | 25.0% |
|---|
| Aecon Group Inc ($ARE) | 9.5% | 9.7% | 8.8% | 10.4% | 10.2% |
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 ($BIN) | 32.2% | 30.7% | 33.1% | 34.0% | 9.8% |
| |
|---|
| Median (85 companies) | 8.3% | 9.4% | 8.3% | 7.7% | 9.9% |
|---|
| Aecon Group Inc ($ARE) | 5.6% | 6.2% | 5.2% | 4.9% | 7.2% |
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% | |
| Horizon North Logistics Inc ($HNL) | 25.1% | 26.5% | 16.3% | 24.1% | 14.7% |
| |
|---|
| Median (92 companies) | 3.0% | 3.1% | 3.7% | 3.2% | 3.9% |
|---|
| Aecon Group Inc ($ARE) | 2.2% | 1.8% | 1.5% | 1.1% | 1.0% |
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 ($EBN) | 24.8% | 28.1% | 16.1% | 32.5% | 26.3% |
| |
|---|
| Median (93 companies) | 9.1% | 9.3% | 8.5% | 9.1% | 9.3% |
|---|
| Aecon Group Inc ($ARE) | 8.2% | 10.4% | 8.4% | 5.3% | 12.6% |
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 ($IBG) | 4.2x | 6.5x | | 8.3x | |
| |
|---|
| Median (72 companies) | 1.1x | 1.5x | 1.4x | 1.2x | 1.6x |
|---|
| Aecon Group Inc ($ARE) | 2.9x | 2.3x | 2.3x | 2.4x | 0.2x |
