ENTREC Corp reports 56.5% CAPEX decline and 28.7% Revenue decline
09.03.2016 • About ENTREC Corp (
$ENT) • By InTwits
ENTREC Corp reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- ENTREC Corp doesn't have a profitable business model yet: 2015 ROIC is -3.1%
- The company has unprofitable business model: ROIC is at -3.1%
- It operates with high leverage: Net Debt/EBITDA is 8.4x while industry average is 2.3x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
ENTREC Corp ($ENT) key annual financial indicators
| mln. CAD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 19.7 | 132.5 | 212.9 | 232.2 | 165.5 | -28.7% |
| Gross Profit | | 45.1 | 72.5 | 67.4 | 40.2 | -40.4% |
| SG&A | | | | | 19.5 | |
| EBITDA | | 30.8 | 50.6 | 43.5 | 19.4 | -55.6% |
| Net Income | 0.2 | 12.1 | 15.8 | -76.4 | -14.6 | -80.8% |
Balance Sheet
|
|---|
| Cash | | 2.5 | 0.7 | 0.5 | 0.1 | -68.6% |
| Short Term Debt | | 15.5 | 22.4 | 2.4 | 5.3 | 119.0% |
| Long Term Debt | | 92.6 | 109.6 | 176.0 | 157.3 | -10.6% |
Cash flow
|
|---|
| Capex | | 46.4 | 56.8 | 68.5 | 29.8 | -56.5% |
Ratios
|
|---|
| Revenue growth | 117,581.2% | 573.9% | 60.7% | 9.1% | -28.7% | |
| EBITDA growth | | | 64.3% | -14.0% | -55.6% | |
| Gross Margin | | 34.0% | 34.1% | 29.0% | 24.3% | -4.8% |
| EBITDA Margin | 0.0% | 23.3% | 23.8% | 18.7% | 11.7% | -7.1% |
| Net Income Margin | 1.0% | 9.1% | 7.4% | -32.9% | -8.8% | 24.1% |
| SG&A, % of revenue | | | | | 11.8% | 11.8% |
| CAPEX, % of revenue | | 35.0% | 26.7% | 29.5% | 18.0% | -11.5% |
| ROIC | | | 9.7% | 4.7% | -3.1% | -7.8% |
| ROE | | | 10.7% | -55.8% | -16.7% | 39.1% |
| Net Debt/EBITDA | | 3.4x | 2.6x | 4.1x | 8.4x | 4.3x |
Revenue and profitability
ENTREC Corp's Revenue dropped on 28.7% in 2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 7.1 pp from 18.7% to 11.7% in 2015.
Gross Margin decreased on 4.8 pp from 29.0% to 24.3% in 2015.
Net Income marign jumped on 24.1 pp from -32.9% to -8.8% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 ENTREC Corp had CAPEX/Revenue of 18.0%. ENTREC Corp's CAPEX/Revenue dropped on 17.0 pp from 35.0% in 2012 to 18.0% in 2015. For the last three years the average CAPEX/Revenue was 24.7%.Battling declining revenue ENTREC Corp made large investments to CAPEX (154% of EBITDA) but that didn't help at least in this year.
Return on investment
The company operates at negative ROIC (-3.10%) and ROE (-16.69%). ROIC decreased on 7.8 pp from 4.7% to -3.1% in 2015. ROE surged on 39.1 pp from -55.8% to -16.7% in 2015.
Leverage (Debt)
Debt level is 8.4x Net Debt / EBITDA and 8.4x Debt / EBITDA. Net Debt / EBITDA surged on 4.3x from 4.1x to 8.4x in 2015. Debt decreased on 8.8% in 2015 while cash dropped on 68.6% in 2015.
Appendix 1: Peers in Industrial
Below you can find ENTREC Corp benchmarking vs. other companies in Industrial industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
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 ($LMP) | | 56.7% | 33.9% | 47.0% | 61.8% |
| |
|---|
| Median (92 companies) | 9.2% | 10.4% | 4.9% | 9.4% | 8.3% |
|---|
| ENTREC Corp ($ENT) | | 573.9% | 60.7% | 9.1% | -28.7% |
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 ($FLY) | 54.0% | 57.2% | 59.2% | 62.9% | |
| |
|---|
| Median (88 companies) | 23.3% | 23.0% | 23.3% | 22.6% | 24.7% |
|---|
| ENTREC Corp ($ENT) | | 34.0% | 34.1% | 29.0% | 24.3% |
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 ($BIN) | 32.2% | 30.7% | 33.1% | 34.0% | 9.8% |
| |
|---|
| Median (85 companies) | 8.2% | 9.2% | 8.3% | 7.2% | 9.5% |
|---|
| ENTREC Corp ($ENT) | | 23.3% | 23.8% | 18.7% | 11.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Cargojet Inc ($CJT.A) | 6.8% | 7.0% | 6.3% | 54.1% | 41.3% |
| Newalta Corp ($NAL) | 17.2% | 21.7% | 34.5% | 35.1% | 42.0% |
| Enterprise Group Inc ($E) | 3.6% | 17.4% | 27.2% | 32.7% | |
| Horizon North Logistics Inc ($HNL) | 25.1% | 26.5% | 16.3% | 24.1% | 14.7% |
| Badger Daylighting Ltd ($BAD) | 19.2% | 22.6% | 21.7% | 23.5% | |
| |
|---|
| Median (92 companies) | 2.7% | 3.0% | 3.5% | 3.1% | 4.0% |
|---|
| ENTREC Corp ($ENT) | | 35.0% | 26.7% | 29.5% | 18.0% |
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 ($SNC) | 14.6% | 10.7% | 4.0% | 35.2% | 11.4% |
| Alarmforce Industries Inc ($AF) | 18.3% | 5.3% | 24.0% | 33.9% | 19.0% |
| Epicore BioNetworks Inc ($EBN) | 24.8% | 28.1% | 16.1% | 32.5% | 26.3% |
| |
|---|
| Median (93 companies) | 9.0% | 9.7% | 8.5% | 9.1% | 9.7% |
|---|
| ENTREC Corp ($ENT) | | | 9.7% | 4.7% | -3.1% |
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 | 12.9x |
| IBI Group Inc ($IBG) | 4.2x | 6.5x | | 8.3x | |
| |
|---|
| Median (72 companies) | 1.1x | 1.5x | 1.4x | 1.2x | 1.6x |
|---|
| ENTREC Corp ($ENT) | | 3.4x | 2.6x | 4.1x | 8.4x |
