George Weston Ltd EBITDA surged on 43.7% in 2015 and Revenue increased on 6.8%
03.03.2016 • About George Weston Ltd (
$WN) • By InTwits
George Weston Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is relatively stable: 7.7% in 2015 vs. 5.7% in 2014 vs. 7.3% in 2011
- George Weston Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.9%. At the same time it's in pair with industry average of 4.7%.
- The company has potentially unprofitable business model: ROIC is at 6.3%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
George Weston Ltd ($WN) key annual financial indicators
| mln. CAD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 32,376 | 32,742 | 33,582 | 43,918 | 46,894 | 6.8% |
| Gross Profit | 7,955 | 8,042 | 8,291 | 11,191 | 13,227 | 18.2% |
| SG&A | 6,346 | 6,649 | 6,675 | 10,218 | 11,298 | 10.6% |
| EBITDA | 2,371 | 2,233 | 2,507 | 2,515 | 3,615 | 43.7% |
| Net Income | 635 | 475 | 672 | 126 | 511 | 305.6% |
Balance Sheet
|
|---|
| Cash | 1,372 | 1,589 | 2,869 | 1,333 | 1,413 | 6.0% |
| Short Term Debt | 1,370 | 1,991 | 2,268 | 1,683 | 2,577 | 53.1% |
| Long Term Debt | 6,757 | 6,261 | 7,736 | 12,306 | 10,928 | -11.2% |
Cash flow
|
|---|
| Capex | 1,027 | 1,110 | 976 | 984 | 1,267 | 28.8% |
Ratios
|
|---|
| Revenue growth | 1.7% | 1.1% | 2.6% | 30.8% | 6.8% | |
| EBITDA growth | 5.3% | -5.8% | 12.3% | 0.3% | 43.7% | |
| Gross Margin | 24.6% | 24.6% | 24.7% | 25.5% | 28.2% | 2.7% |
| EBITDA Margin | 7.3% | 6.8% | 7.5% | 5.7% | 7.7% | 2.0% |
| Net Income Margin | 2.0% | 1.5% | 2.0% | 0.3% | 1.1% | 0.8% |
| SG&A, % of revenue | 19.6% | 20.3% | 19.9% | 23.3% | 24.1% | 0.8% |
| CAPEX, % of revenue | 3.2% | 3.4% | 2.9% | 2.2% | 2.7% | 0.5% |
| ROIC | 10.4% | 8.8% | 9.2% | 4.0% | 6.3% | 2.4% |
| ROE | 11.1% | 8.3% | 12.1% | 1.4% | 7.0% | 5.6% |
| Net Debt/EBITDA | 2.8x | 3.0x | 2.8x | 5.0x | 3.3x | -1.7x |
Revenue and profitability
George Weston Ltd's Revenue increased on 6.8% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 2.9 pp from 5.6% to 8.5% in 2015.
Gross Margin increased on 2.7 pp from 25.5% to 28.2% in 2015. SG&A as a % of Revenue increased slightly on 0.83 pp from 23.3% to 24.1% in 2015.
Net Income marign increased slightly on 0.80 pp from 0.29% to 1.1% in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 2.7% in 2015. The company's CAPEX/Revenue decreased slightly on 0.69 pp from 3.4% in 2012 to 2.7% in 2015. For the last three years the average CAPEX/Revenue was 2.6%.
Return on investment
The company operates at low ROIC (6.35%) and ROE (7.00%). ROIC increased on 2.4 pp from 4.0% to 6.3% in 2015. ROE increased on 5.6 pp from 1.4% to 7.0% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 3.3x and Debt / EBITDA is 3.7x. Net Debt / EBITDA dropped on 1.7x from 5.0x to 3.3x in 2015. Debt decreased on 3.5% in 2015 while cash increased on 6.0% in 2015.
Appendix 1: Peers in Consumer, Non-cyclical
Below we provide George Weston Ltd benchmarking against other companies in Consumer, Non-cyclical 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 |
|---|
| GDI Integrated Facility Services Inc ($GDI) | | -38.8% | -72.9% | 218,969.1% | 18.7% |
| Cardiome Pharma Corp ($COM) | -97.7% | -47.6% | 471.7% | 566.0% | |
| Patient Home Monitoring Corp ($PHM) | | 170.2% | 1.9% | 433.0% | 238.4% |
| Family Memorials Inc ($FAM) | -13.6% | 54.7% | 22.9% | 245.3% | |
| Nobilis Health Corp ($NHC) | 16.6% | 45.3% | 49.0% | 169.9% | |
| |
|---|
| Median (86 companies) | 17.7% | 9.3% | 6.7% | 12.7% | 6.9% |
|---|
| George Weston Ltd ($WN) | | 1.1% | 2.6% | 30.8% | 6.8% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Nobilis Health Corp ($NHC) | | | | 99.8% | |
| Cipher Pharmaceuticals Inc ($CPH) | | | 99.5% | 98.3% | 92.7% |
| Heritage Global Inc ($HGP) | 99.5% | | | 95.7% | |
| Ritchie Bros Auctioneers Inc ($RBA) | 87.9% | 88.7% | 88.4% | 88.0% | 89.1% |
| Concordia Healthcare Corp ($CXR) | | | 79.4% | 86.0% | |
| |
|---|
| Median (74 companies) | 35.5% | 38.6% | 36.2% | 35.7% | 33.1% |
|---|
| George Weston Ltd ($WN) | 24.6% | 24.6% | 24.7% | 25.5% | 28.2% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Cipher Pharmaceuticals Inc ($CPH) | -50.0% | 40.6% | 71.4% | 63.7% | 12.8% |
| Merus Labs International Inc ($MSL) | | 32.9% | 64.7% | 46.2% | 61.5% |
| Valeant Pharmaceuticals International Inc ($VRX) | 37.0% | 30.6% | 27.8% | 45.6% | |
| EnerCare Inc ($ECI) | 59.0% | 52.8% | 51.0% | 45.5% | |
| Information Services Corp ($ISV) | 34.1% | 39.6% | 39.6% | 37.6% | |
| |
|---|
| Median (85 companies) | 8.1% | 8.5% | 9.0% | 11.0% | 10.6% |
|---|
| George Weston Ltd ($WN) | 7.3% | 6.8% | 7.5% | 5.7% | 7.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Neptune Technologies & Bioressources Inc ($NTB) | 6.0% | 4.7% | 73.6% | 84.6% | 119.0% |
| CanaDream Corp ($CDN) | 68.6% | 43.3% | 38.1% | 70.4% | 63.4% |
| Ceapro Inc ($CZO) | 2.2% | 3.9% | 35.3% | 52.0% | |
| Feronia Inc/Canada ($FRN) | 129.0% | 191.4% | 117.4% | 42.4% | |
| Microbix Biosystems Inc ($MBX) | 1.0% | 1.2% | 3.0% | 40.3% | 38.7% |
| |
|---|
| Median (86 companies) | 2.4% | 2.6% | 2.4% | 2.6% | 2.2% |
|---|
| George Weston Ltd ($WN) | 3.2% | 3.4% | 2.9% | 2.2% | 2.7% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Biosyent Inc ($RX) | 45.5% | 71.7% | 62.4% | 62.9% | |
| Information Services Corp ($ISV) | 56.0% | 71.8% | 72.8% | 58.9% | |
| Covalon Technologies Ltd ($COV) | -49.6% | -75.8% | -30.1% | 50.6% | -12.4% |
| Cipher Pharmaceuticals Inc ($CPH) | -22.9% | 21.8% | 81.4% | 44.6% | -0.1% |
| Ceapro Inc ($CZO) | 69.9% | -33.5% | 15.5% | 43.5% | |
| |
|---|
| Median (86 companies) | 7.4% | 6.3% | 6.7% | 7.3% | 6.4% |
|---|
| George Weston Ltd ($WN) | 10.4% | 8.8% | 9.2% | 4.0% | 6.3% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Noble Iron Inc ($NIR) | | 25.5x | 12.9x | 227.3x | |
| Family Memorials Inc ($FAM) | | | | 15.2x | |
| Amica Mature Lifestyles Inc ($ACC) | 11.7x | 9.4x | 14.7x | 13.8x | 12.3x |
| Cott Corp ($BCB) | 2.6x | 2.0x | 2.2x | 13.4x | 4.9x |
| CRH Medical Corp ($CRH) | -2.3x | -3.1x | -3.5x | 12.0x | 1.3x |
| |
|---|
| Median (70 companies) | 1.8x | 2.5x | 2.2x | 2.6x | 1.6x |
|---|
| George Weston Ltd ($WN) | 2.8x | 3.0x | 2.8x | 5.0x | 3.3x |
