Parex Resources Inc CAPEX dropped on 57.6% in 2015 and Revenue dropped on 27.2%
08.03.2016 • About Parex Resources Inc (
$PXT) • By InTwits
Parex Resources Inc reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Parex Resources Inc doesn't have a profitable business model yet: 2015 ROIC is -4.5%
- EBITDA Margin is quite volatile: 23.3% in 2015, 28.9% in 2014, 56.9% in 2013, 53.0% in 2012, 59.8% in 2011
- Parex Resources Inc has high CAPEX intensity: 5 year average CAPEX/Revenue was 51.9%. At the same time it's a lot of higher than industry average of 1.8%.
- CAPEX is quite volatile: 125 in 2015, 296 in 2014, 219 in 2013, 268 in 2012, 150 in 2011
- The company has unprofitable business model: ROIC is at -4.5%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Parex Resources Inc ($PXT) key annual financial indicators
| mln. $ | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 157.2 | 487.6 | 559.2 | 669.2 | 487.1 | -27.2% |
| Gross Profit | 146.0 | 451.3 | 287.8 | 360.5 | 261.2 | -27.5% |
| SG&A | 15.8 | 31.0 | 30.4 | 32.5 | 36.7 | 13.0% |
| EBITDA | 94.0 | 258.4 | 318.2 | 193.1 | 113.7 | -41.1% |
| Net Income | 15.6 | 39.9 | 12.7 | -108.8 | -44.6 | -59.0% |
Balance Sheet
|
|---|
| Cash | 103.9 | 32.0 | 56.5 | 39.0 | 94.8 | 143.1% |
| Short Term Debt | 0.0 | 0.0 | 1.6 | 2.1 | 2.1 | -1.9% |
| Long Term Debt | 60.0 | 74.8 | 74.6 | 35.0 | 0.0 | -100.0% |
Cash flow
|
|---|
| Capex | 149.6 | 267.7 | 219.3 | 296.2 | 125.5 | -57.6% |
Ratios
|
|---|
| Revenue growth | 6,328.5% | 210.1% | 14.7% | 19.7% | -27.2% | |
| EBITDA growth | -747.3% | 174.8% | 23.2% | -39.3% | -41.1% | |
| Gross Margin | 92.9% | 92.6% | 51.5% | 53.9% | 53.6% | -0.2% |
| EBITDA Margin | 59.8% | 53.0% | 56.9% | 28.9% | 23.3% | -5.5% |
| Net Income Margin | 9.9% | 8.2% | 2.3% | -16.3% | -9.2% | 7.1% |
| SG&A, % of revenue | 10.0% | 6.4% | 5.4% | 4.9% | 7.5% | 2.7% |
| CAPEX, % of revenue | 95.2% | 54.9% | 39.2% | 44.3% | 25.8% | -18.5% |
| ROIC | 10.7% | 12.4% | 15.1% | -3.2% | -4.5% | -1.3% |
| ROE | 5.2% | 9.0% | 2.7% | -19.0% | -6.4% | 12.6% |
| Net Debt/EBITDA | -0.5x | 0.2x | 0.1x | -0.0x | -0.8x | -0.8x |
Revenue and profitability
Parex Resources Inc's Revenue dropped on 27.2% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 9.4 pp from 16.9% to 26.2% in 2015.
Gross Margin showed almost no change in 2015. SG&A as a % of Revenue increased on 2.7 pp from 4.9% to 7.5% in 2015.
Net Income marign increased on 7.1 pp from -16.3% to -9.2% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 Parex Resources Inc had CAPEX/Revenue of 25.8%. The company showed big decline in CAPEX/Revenue of 29.1 pp from 54.9% in 2012 to 25.8% in 2015. Average CAPEX/Revenue for the last three years was 36.4%.The company has spent a lot to CAPEX (110% of EBITDA) which didn't stop revenue from falling.
Return on investment
The company operates at negative ROIC (-4.50%) and ROE (-6.36%). ROIC decreased slightly on 1.3 pp from -3.2% to -4.5% in 2015. ROE jumped on 12.6 pp from -19.0% to -6.4% in 2015.
Leverage (Debt)
Debt level is -0.8x Net Debt / EBITDA and 0.0x Debt / EBITDA. Net Debt / EBITDA dropped on 0.8x from -0.0096x to -0.8x in 2015. Debt dropped on 94.3% in 2015 while cash jumped on 143% in 2015.
Management team
Wayne Kim Foo is a the company's CEO. Wayne Kim Foo is a founder and has spent 9 years at the company.
Appendix 1: Peers in Energy
Below we provide Parex Resources Inc 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 ($SPE) | -8.2% | 16.6% | 29.9% | 923.7% | |
| |
|---|
| Median (160 companies) | 39.7% | 9.5% | 17.1% | 17.6% | -28.8% |
|---|
| Parex Resources Inc ($PXT) | | 210.1% | 14.7% | 19.7% | -27.2% |
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% | 88.5% |
| Freehold Royalties Ltd ($FRU) | 91.7% | 90.4% | 89.0% | 90.2% | 86.3% |
| MEG Energy Corp ($MEG) | 85.5% | 86.8% | 87.4% | 87.6% | 84.1% |
| NXT Energy Solutions Inc ($SFD) | -43.2% | 65.6% | 36.0% | 87.3% | |
| |
|---|
| Median (140 companies) | 33.3% | 29.3% | 31.5% | 29.6% | 30.2% |
|---|
| Parex Resources Inc ($PXT) | 92.9% | 92.6% | 51.5% | 53.9% | 53.6% |
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% | 70.1% |
| Bonavista Energy Corp ($BNP) | 63.8% | 64.6% | 62.6% | 91.6% | 54.5% |
| Bellatrix Exploration Ltd ($BXE) | 42.7% | 58.6% | 83.6% | 89.6% | |
| Advantage Oil & Gas Ltd ($AAV) | -4.0% | 5.2% | 66.1% | 87.8% | 81.8% |
| |
|---|
| Median (159 companies) | 24.7% | 25.0% | 30.5% | 29.6% | 12.4% |
|---|
| Parex Resources Inc ($PXT) | 59.8% | 53.0% | 56.9% | 28.9% | 23.3% |
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 ($BKX) | 139.2% | 195.8% | 789.1% | 316.6% | |
| |
|---|
| Median (162 companies) | 42.0% | 47.3% | 39.1% | 48.8% | 28.6% |
|---|
| Parex Resources Inc ($PXT) | 95.2% | 54.9% | 39.2% | 44.3% | 25.8% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Pason Systems Inc ($PSI) | 33.5% | 30.0% | 29.7% | 41.0% | 6.0% |
| Sea Dragon Energy Inc ($SDX) | -10.1% | 8.1% | 21.8% | 32.9% | |
| Raging River Exploration Inc ($RRX) | | | | 29.1% | 6.2% |
| High Arctic Energy Services Inc ($HWO) | 27.0% | 31.4% | 26.3% | 24.9% | |
| Rooster Energy Ltd ($COQ) | | | | 22.9% | |
| |
|---|
| Median (165 companies) | 4.4% | 3.2% | 4.5% | 5.1% | -6.6% |
|---|
| Parex Resources Inc ($PXT) | 10.7% | 12.4% | 15.1% | -3.2% | -4.5% |
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 | |
| Pengrowth Energy Corp ($PGF) | 1.5x | 2.9x | 2.1x | 16.8x | |
| |
|---|
| Median (136 companies) | 1.2x | 1.6x | 1.5x | 1.4x | 3.0x |
|---|
| Parex Resources Inc ($PXT) | -0.5x | 0.2x | 0.1x | -0.0x | -0.8x |
