Hardwoods Distribution Inc reports 36.6% EBITDA growth and 25.4% Revenue growth
11.03.2016 • About Hardwoods Distribution Inc (
$HWD) • By InTwits
Hardwoods Distribution Inc reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Hardwoods Distribution Inc is a fast growth stock: 2015 revenue growth was 25.4%, 5 year revenue CAGR was 23.7% at 2015 ROIC 20.9%
- Hardwoods Distribution Inc has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.3%.
- The company has highly profitable business model: ROIC is at 20.9%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Hardwoods Distribution Inc ($HWD) key annual financial indicators
| mln. CAD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 230.0 | 306.1 | 371.2 | 455.7 | 571.6 | 25.4% |
| Gross Profit | 40.6 | 53.8 | 67.6 | 78.8 | 99.6 | 26.5% |
| SG&A | 27.6 | 34.0 | 38.8 | 43.4 | 67.4 | 55.2% |
| EBITDA | 6.0 | 12.3 | 21.4 | 25.5 | 34.8 | 36.6% |
| Net Income | 6.1 | 6.2 | 13.1 | 14.0 | 20.1 | 43.7% |
Balance Sheet
|
|---|
| Cash | 0.4 | 0.1 | 0.1 | 0.0 | 0.0 | -100.0% |
| Short Term Debt | 20.6 | 25.4 | 28.8 | 36.4 | 30.0 | -17.5% |
| Long Term Debt | 0.6 | 0.6 | 0.8 | 0.7 | 0.7 | -7.1% |
Cash flow
|
|---|
| Capex | 0.4 | 0.8 | 0.9 | 1.5 | 1.9 | 22.8% |
Ratios
|
|---|
| Revenue growth | 16.4% | 33.1% | 21.3% | 22.8% | 25.4% | |
| EBITDA growth | 36.6% | 106.9% | 73.1% | 19.2% | 36.6% | |
| Gross Margin | 17.7% | 17.6% | 18.2% | 17.3% | 17.4% | 0.1% |
| EBITDA Margin | 2.6% | 4.0% | 5.8% | 5.6% | 6.1% | 0.5% |
| Net Income Margin | 2.6% | 2.0% | 3.5% | 3.1% | 3.5% | 0.4% |
| SG&A, % of revenue | 12.0% | 11.1% | 10.4% | 9.5% | 11.8% | 2.3% |
| CAPEX, % of revenue | 0.2% | 0.3% | 0.3% | 0.3% | 0.3% | -0.0% |
| ROIC | | 13.1% | 19.9% | 18.8% | 20.9% | 2.0% |
| ROE | | 8.4% | 15.7% | 14.1% | 16.0% | 2.0% |
| Net Debt/EBITDA | 3.5x | 2.1x | 1.4x | 1.5x | 0.9x | -0.6x |
Revenue and profitability
Hardwoods Distribution Inc's Revenue jumped on 25.4% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 8.3 pp from 32.6% to 40.9% in 2015.
Gross Margin showed almost no change in 2015. SG&A as a % of Revenue increased on 2.3 pp from 9.5% to 11.8% in 2015.
Net Income marign showed almost no change in 2015.
Capital expenditures (CAPEX) and working capital investments
Hardwoods Distribution Inc's CAPEX/Revenue was 0.32% in 2015. The company's CAPEX/Revenue showed almost no change from 2012 to 2015. For the last three years the average CAPEX/Revenue was 0.30%.
Return on investment
The company operates at high and attractive ROIC (20.87%) while ROE is a bit lower (16.02%). ROIC increased on 2.0 pp from 18.8% to 20.9% in 2015. ROE increased slightly on 2.0 pp from 14.1% to 16.0% in 2015.
Leverage (Debt)
Debt level is 0.9x Net Debt / EBITDA and 0.9x Debt / EBITDA. Net Debt / EBITDA dropped on 0.6x from 1.5x to 0.9x in 2015. Debt dropped on 17.3% in 2015 while cash dropped on 100% in 2015.
Appendix 1: Peers in Consumer, Cyclical
Below we provide Hardwoods Distribution Inc benchmarking against other companies in Consumer, 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 |
|---|
| Amaya Inc ($AYA) | 216.4% | 311.5% | 85.2% | 254.0% | |
| Partner Jet Corp ($PJT) | -19.9% | -15.2% | 1.2% | 119.7% | |
| Kelso Technologies Inc ($KLS) | 80.5% | 577.5% | 487.8% | 81.4% | |
| XPEL Technologies Corp ($DAP.U) | 46.3% | 76.6% | 67.7% | 65.5% | |
| Holloway Lodging Corp ($HLC) | | -24.6% | 2.7% | 62.7% | 13.5% |
| |
|---|
| Median (68 companies) | 16.1% | 5.3% | 4.9% | 7.0% | 4.0% |
|---|
| Hardwoods Distribution Inc ($HWD) | | 33.1% | 21.3% | 22.8% | 25.4% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Restaurant Brands International Inc ($QSR) | | | 69.7% | 87.0% | 42.9% |
| Imvescor Restaurant Group Inc ($IRG) | 96.2% | 94.2% | 89.7% | 84.9% | 84.3% |
| DEQ Systems Corp ($DEQ) | 74.3% | 77.5% | 78.4% | 84.7% | |
| Cara Operations Ltd ($CAO) | | | 79.2% | 78.9% | 78.4% |
| Second Cup Ltd/The ($SCU) | 91.1% | 86.6% | 85.1% | 72.7% | 81.1% |
| |
|---|
| Median (60 companies) | 37.9% | 36.5% | 34.1% | 35.4% | 35.4% |
|---|
| Hardwoods Distribution Inc ($HWD) | 17.7% | 17.6% | 18.2% | 17.3% | 17.4% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Westshore Terminals Investment Corp ($WTE) | | 49.7% | 65.9% | 60.9% | 59.6% |
| Gamehost Inc ($GH) | 44.2% | 46.1% | 45.7% | 45.9% | 42.8% |
| Great Canadian Gaming Corp ($GC) | 34.1% | 16.8% | 41.1% | 40.1% | 36.6% |
| Amaya Inc ($AYA) | -5.7% | 7.2% | 38.2% | 39.3% | |
| MTY Food Group Inc ($MTY) | 32.2% | 36.3% | 38.7% | 37.0% | 34.9% |
| |
|---|
| Median (66 companies) | 8.7% | 8.1% | 9.8% | 10.1% | 10.1% |
|---|
| Hardwoods Distribution Inc ($HWD) | 2.6% | 4.0% | 5.8% | 5.6% | 6.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Poydras Gaming Finance Corp ($PYD) | | | | 32.5% | |
| WestJet Airlines Ltd ($WJA) | 3.9% | 7.9% | 19.5% | 18.6% | 22.5% |
| Exchange Income Corp ($EIF) | 8.2% | 7.9% | 15.8% | 15.5% | 15.4% |
| Holloway Lodging Corp ($HLC) | 3.4% | 8.2% | 6.7% | 14.8% | 26.7% |
| Kelso Technologies Inc ($KLS) | 79.2% | 0.4% | 0.7% | 13.5% | |
| |
|---|
| Median (69 companies) | 2.9% | 2.7% | 2.9% | 2.5% | 3.1% |
|---|
| Hardwoods Distribution Inc ($HWD) | 0.2% | 0.3% | 0.3% | 0.3% | 0.3% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Partner Jet Corp ($PJT) | -30.7% | -51.6% | -50.8% | 85.1% | |
| Kelso Technologies Inc ($KLS) | -121.3% | | | 48.8% | |
| XPEL Technologies Corp ($DAP.U) | 52.9% | 54.7% | 57.5% | 43.2% | |
| Westshore Terminals Investment Corp ($WTE) | | 24.0% | 37.8% | 35.0% | 38.3% |
| Iplayco Corp Ltd ($IPC) | -35.4% | 23.0% | 58.5% | 33.6% | 10.9% |
| |
|---|
| Median (69 companies) | 10.6% | 9.7% | 10.1% | 9.7% | 11.0% |
|---|
| Hardwoods Distribution Inc ($HWD) | | 13.1% | 19.9% | 18.8% | 20.9% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Mountain China Resorts Holding Ltd ($MCG) | | | | 317.1x | |
| Restaurant Brands International Inc ($QSR) | | | 3.8x | 33.6x | 5.8x |
| Allied Hotel Properties Inc ($AHP) | | | | 21.3x | |
| Hudson's Bay Co ($HBC) | 8.7x | 3.8x | 3.6x | 19.1x | 3.6x |
| Amaya Inc ($AYA) | | 17.9x | 1.8x | 13.5x | |
| |
|---|
| Median (58 companies) | 1.3x | 1.2x | 1.8x | 2.1x | 1.4x |
|---|
| Hardwoods Distribution Inc ($HWD) | 3.5x | 2.1x | 1.4x | 1.5x | 0.9x |
