Denison Mines Corp CAPEX jumped on 131% in 2015 and Revenue jumped on 31.7%
09.03.2016 • About Denison Mines Corp (
$DML) • By InTwits
Denison Mines Corp reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Denison Mines Corp doesn't have a profitable business model yet: 2015 ROIC is -21.1%
- The company operates at negative EBITDA Margin: -356.1%
- Denison Mines Corp spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for 2011-2015 is 0.0%. Average EBITDA Margin for the same period was -187.3%0
- Denison Mines Corp has high CAPEX intensity: 5 year average CAPEX/Revenue was 51.7%. At the same time it's a lot of higher than industry average of 27.2%.
- CAPEX is quite volatile: 2.0 in 2015, 0.86 in 2014, 2.3 in 2013, 13.1 in 2012, 24.3 in 2011
- The company has unprofitable business model: ROIC is at -21.1%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Denison Mines Corp ($DML) key annual financial indicators
| mln. $ | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 25.796 | 11.127 | 10.407 | 9.619 | 12.670 | 31.7% |
| Gross Profit | -1.119 | -3.257 | 1.596 | -2.032 | 0.262 | -112.9% |
| SG&A | 9.901 | 10.475 | 8.167 | 6.636 | 6.463 | -2.6% |
| EBITDA | 13.905 | -9.633 | -67.230 | -22.294 | -45.124 | 102.4% |
| Net Income | -70.869 | -117.964 | -83.835 | -31.703 | -51.560 | 62.6% |
Balance Sheet
|
|---|
| Cash | 53.515 | 38.188 | 21.786 | 18.640 | 5.367 | -71.2% |
| Short Term Debt | 0.111 | 0.125 | 0.055 | 0.030 | 0.300 | 900.0% |
| Long Term Debt | 0.110 | 0.104 | 0.042 | 0.009 | 0.000 | -100.0% |
Cash flow
|
|---|
| Capex | 24.274 | 13.122 | 2.262 | 0.859 | 1.987 | 131.3% |
Ratios
|
|---|
| Revenue growth | -79.9% | -56.9% | -6.5% | -7.6% | 31.7% | |
| EBITDA growth | -68.2% | -169.3% | 597.9% | -66.8% | 102.4% | |
| Gross Margin | -4.3% | -29.3% | 15.3% | -21.1% | 2.1% | 23.2% |
| EBITDA Margin | 53.9% | -86.6% | -646.0% | -231.8% | -356.1% | -124.4% |
| Net Income Margin | -274.7% | -1,060.2% | -805.6% | -329.6% | -406.9% | -77.4% |
| SG&A, % of revenue | 38.4% | 94.1% | 78.5% | 69.0% | 51.0% | -18.0% |
| CAPEX, % of revenue | 94.1% | 117.9% | 21.7% | 8.9% | 15.7% | 6.8% |
| ROIC | -5.5% | -7.8% | -23.4% | -8.4% | -21.1% | -12.8% |
| ROE | -15.3% | -32.8% | -31.0% | -11.9% | -24.4% | -12.5% |
| Net Debt/EBITDA | -3.8x | | | | | 0.0x |
Revenue and profitability
The company's Revenue surged on 31.7% in 2015. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased on 3.6 pp from -13.6% to -10.0% in FY2015.
Gross Margin jumped on 23.2 pp from -21.1% to 2.1% in 2015. SG&A as a % of Revenue dropped on 18.0 pp from 69.0% to 51.0% in 2015.
Net Income marign dropped on 77.4 pp from -330% to -407% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 Denison Mines Corp had CAPEX/Revenue of 15.7%. Denison Mines Corp's CAPEX/Revenue dropped on 102 pp from 118% in 2012 to 15.7% in 2015. It's average level of CAPEX/Revenue for the last three years was 15.4%.
Return on investment
The company operates at negative ROIC (-21.12%) and ROE (-24.37%). ROIC dropped on 12.8 pp from -8.4% to -21.1% in 2015. ROE dropped on 12.5 pp from -11.9% to -24.4% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is -7.2x and Debt / EBITDA is . Net Debt / EBITDA didn't change in 2015. Debt surged on 669% in 2015 while cash dropped on 71.2% in 2015.
Management team
David D Cates is a Denison Mines Corp's CEO. David D Cates is a founder and has spent 3 years at the company. Denison Mines Corp's CFO is Mac Mcdonald. Mac Mcdonald has 3 years tenure at the company.
Appendix 1: Peers in Basic Materials
Below we provide Denison Mines Corp benchmarking against other companies in Basic Materials 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 |
|---|
| Northern Sun Mining Corp ($NSC) | -93.3% | 315.4% | -99.4% | 8,924.9% | |
| Turquoise Hill Resources Ltd ($TRQ) | | | -34.0% | 3,268.9% | -5.8% |
| Asian Mineral Resources Ltd ($ASN) | | | | 859.1% | |
| Ur-Energy Inc ($URE) | | | | 285.4% | 42.7% |
| Nevsun Resources Ltd ($NSU) | | 3.3% | -72.5% | 256.5% | -35.7% |
| |
|---|
| Median (130 companies) | 57.8% | 8.5% | -5.0% | -0.8% | -5.1% |
|---|
| Denison Mines Corp ($DML) | | -56.9% | -6.5% | -7.6% | 31.7% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Nevsun Resources Ltd ($NSU) | 90.3% | 89.9% | 94.8% | 95.5% | 82.3% |
| Franco-Nevada Corp ($FNV) | 84.6% | 86.1% | 85.0% | 83.5% | |
| Labrador Iron Ore Royalty Corp ($LIF) | 80.2% | 80.2% | 80.2% | 80.2% | 80.3% |
| Lucara Diamond Corp ($LUC) | | 42.5% | 57.4% | 66.7% | 60.9% |
| Royal Gold Inc ($RGL) | 68.9% | 71.5% | 70.6% | 57.6% | 86.0% |
| |
|---|
| Median (133 companies) | 31.2% | 32.0% | 21.8% | 17.6% | 15.5% |
|---|
| Denison Mines Corp ($DML) | -4.3% | -29.3% | 15.3% | -21.1% | 2.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Royal Gold Inc ($RGL) | 86.1% | 88.2% | 88.6% | 84.4% | 65.0% |
| Franco-Nevada Corp ($FNV) | 38.6% | 62.1% | 44.6% | 72.3% | |
| Silver Wheaton Corp ($SLW) | 84.8% | 82.6% | 75.3% | 69.6% | |
| Sandstorm Gold Ltd ($SSL) | 63.8% | 74.3% | 49.9% | 62.1% | |
| Nevsun Resources Ltd ($NSU) | 81.0% | 76.8% | 54.5% | 60.4% | 38.6% |
| |
|---|
| Median (137 companies) | 22.0% | 18.6% | 11.7% | 9.9% | 6.7% |
|---|
| Denison Mines Corp ($DML) | 53.9% | -86.6% | -646.0% | -231.8% | -356.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Barkerville Gold Mines Ltd ($BGM) | 123.7% | 38.5% | 49.9% | 7,166.9% | 3.2% |
| Marlin Gold Mining Ltd ($MLN) | | | | 508.8% | |
| Imperial Metals Corp ($III) | 28.2% | 69.2% | 185.7% | 280.2% | |
| Golden Minerals Co ($AUM) | 462.4% | 36.9% | 16.8% | 212.8% | 0.5% |
| Franco-Nevada Corp ($FNV) | 9.3% | 3.7% | 35.5% | 201.6% | |
| |
|---|
| Median (139 companies) | 23.9% | 26.3% | 25.5% | 16.3% | 13.1% |
|---|
| Denison Mines Corp ($DML) | 94.1% | 117.9% | 21.7% | 8.9% | 15.7% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Lucara Diamond Corp ($LUC) | -7.1% | -2.9% | 41.3% | 54.7% | 39.6% |
| CanAf Group Inc ($CAF) | 74.9% | 37.0% | 65.2% | 37.6% | 13.8% |
| Nevsun Resources Ltd ($NSU) | 89.8% | 52.2% | 8.8% | 35.0% | 10.4% |
| Dynacor Gold Mines Inc ($DNG) | 45.6% | 62.8% | 50.9% | 31.3% | |
| Canfor Pulp Products Inc ($CFX) | 103.5% | 4.9% | 13.2% | 21.3% | 24.1% |
| |
|---|
| Median (143 companies) | 7.0% | 4.9% | 0.1% | 0.6% | -3.8% |
|---|
| Denison Mines Corp ($DML) | -5.5% | -7.8% | -23.4% | -8.4% | -21.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| VMS Ventures Inc ($VMS) | | | | 86.7x | 4.7x |
| Ur-Energy Inc ($URE) | | | | 55.1x | 6.7x |
| Katanga Mining Ltd ($KAT) | 0.4x | 19.4x | 3.3x | 18.8x | |
| HudBay Minerals Inc ($HBM) | -2.8x | -4.8x | 2.0x | 14.0x | |
| Imperial Metals Corp ($III) | -0.1x | 1.5x | 4.9x | 12.9x | |
| |
|---|
| Median (95 companies) | -0.0x | 0.3x | 0.8x | 0.9x | 1.3x |
|---|
