Valeura Energy Inc reports 141% Net Income decline and 11.7% Revenue decline
08.03.2016 • About Valeura Energy Inc (
$VLE) • By InTwits
Valeura Energy Inc reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Valeura Energy Inc doesn't have a profitable business model yet: 2015 ROIC is 0.6%
- EBITDA Margin is quite volatile: 48.6% in 2015, 59.8% in 2014, -26.9% in 2013, -15.5% in 2012, -29.1% in 2011
- Valeura Energy Inc has high CAPEX intensity: 5 year average CAPEX/Revenue was 102.9%. At the same time it's in pair with industry average of 89.0%.
- CAPEX is quite volatile: 13.2 in 2015, 11.3 in 2014, 27.0 in 2013, 31.3 in 2012, 17.1 in 2011
- The company has potentially unprofitable business model: ROIC is at 0.6%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Valeura Energy Inc ($VLE) key annual financial indicators
| mln. CAD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 14.985 | 22.330 | 19.093 | 22.049 | 19.461 | -11.7% |
| Gross Profit | 1.171 | 7.617 | 7.566 | 9.000 | 8.222 | -8.6% |
| SG&A | | | | | 6.298 | |
| EBITDA | -4.356 | -3.464 | -5.132 | 13.188 | 9.454 | -28.3% |
| Net Income | -15.776 | -15.905 | -17.518 | 1.362 | -0.562 | -141.3% |
Balance Sheet
|
|---|
| Cash | 24.107 | 29.031 | 6.511 | 5.928 | 6.973 | 17.6% |
| Short Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
| Long Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
Cash flow
|
|---|
| Capex | 17.137 | 31.255 | 26.952 | 11.300 | 13.192 | 16.7% |
Ratios
|
|---|
| Revenue growth | 387.7% | 49.0% | -14.5% | 15.5% | -11.7% | |
| EBITDA growth | -47.7% | -20.5% | 48.2% | -357.0% | -28.3% | |
| Gross Margin | 7.8% | 34.1% | 39.6% | 40.8% | 42.2% | 1.4% |
| EBITDA Margin | -29.1% | -15.5% | -26.9% | 59.8% | 48.6% | -11.2% |
| Net Income Margin | -105.3% | -71.2% | -91.8% | 6.2% | -2.9% | -9.1% |
| SG&A, % of revenue | | | | | 32.4% | 32.4% |
| CAPEX, % of revenue | 114.4% | 140.0% | 141.2% | 51.2% | 67.8% | 16.5% |
| ROIC | -20.5% | -13.4% | -14.3% | 3.6% | 0.6% | -3.1% |
| ROE | -24.1% | -16.5% | -20.2% | 1.8% | -0.7% | -2.5% |
| Net Debt/EBITDA | | | | -0.4x | -0.7x | -0.3x |
Revenue and profitability
Valeura Energy Inc's Revenue dropped on 11.7% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin surged on 10.1 pp from -34.3% to -24.1% in 2015.
Gross Margin increased slightly on 1.4 pp from 40.8% to 42.2% in 2015.
Net Income marign decreased on 9.1 pp from 6.2% to -2.9% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 Valeura Energy Inc had CAPEX/Revenue of 67.8%. CAPEX/Revenue dropped on 72.2 pp from 140% in 2012 to 67.8% in 2015. It's average level of CAPEX/Revenue for the last three years was 86.7%.The company has spent a lot to CAPEX (140% of EBITDA) which didn't stop revenue from falling.
Return on investment
The company operates at low but positive ROIC (0.55%) and negative ROE (-0.73%). ROIC decreased on 3.1 pp from 3.6% to 0.55% in 2015. ROE decreased on 2.5 pp from 1.8% to -0.73% in 2015.
Leverage (Debt)
The company has no debt. Cash surged on 17.6% in 2015.
Appendix 1: Peers in Energy
Below we provide Valeura Energy 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 ($SPE) | -8.2% | 16.6% | 29.9% | 923.7% | |
| |
|---|
| Median (160 companies) | 39.7% | 9.5% | 17.1% | 18.5% | -28.8% |
|---|
| Valeura Energy Inc ($VLE) | | 49.0% | -14.5% | 15.5% | -11.7% |
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 ($SFD) | -43.2% | 65.6% | 36.0% | 87.3% | |
| |
|---|
| Median (140 companies) | 34.2% | 29.3% | 31.5% | 29.6% | 30.2% |
|---|
| Valeura Energy Inc ($VLE) | 7.8% | 34.1% | 39.6% | 40.8% | 42.2% |
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 ($AAV) | -4.0% | 5.2% | 66.1% | 87.8% | 81.8% |
| |
|---|
| Median (159 companies) | 25.5% | 25.7% | 31.1% | 28.9% | 12.4% |
|---|
| Valeura Energy Inc ($VLE) | -29.1% | -15.5% | -26.9% | 59.8% | 48.6% |
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 ($BKX) | 139.2% | 195.8% | 789.1% | 316.6% | |
| |
|---|
| Median (162 companies) | 42.0% | 47.3% | 39.1% | 47.1% | 27.8% |
|---|
| Valeura Energy Inc ($VLE) | 114.4% | 140.0% | 141.2% | 51.2% | 67.8% |
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 ($COQ) | | | | 22.9% | |
| |
|---|
| Median (165 companies) | 4.5% | 3.5% | 4.6% | 5.1% | -6.6% |
|---|
| Valeura Energy Inc ($VLE) | -20.5% | -13.4% | -14.3% | 3.6% | 0.6% |
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 ($PGF) | 1.5x | 2.9x | 2.1x | 16.8x | |
| |
|---|
| Median (136 companies) | 1.2x | 1.5x | 1.5x | 1.4x | 3.0x |
|---|
| Valeura Energy Inc ($VLE) | | | | -0.4x | -0.7x |
