North West Co Inc/The revenue jumped on 10.6% in 2016
15.03.2016 • About North West Co Inc/The (
$NWC) • By InTwits
North West Co Inc/The reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- North West Co Inc/The has low CAPEX intensity: 5 year average CAPEX/Revenue was 3.0%. At the same time it's a lot of higher than industry average of 45.3%.
- CAPEX is quite volatile: 22.5 in 2016, 180 in 2015, 47.6 in 2014, 36.7 in 2013, 42.9 in 2012
- The company has highly profitable business model: ROIC is at 20.1%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
North West Co Inc/The ($NWC) key annual financial indicators
| mln. CAD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 1,495 | 1,514 | 1,543 | 1,624 | 1,796 | 10.6% |
| Gross Profit | 428 | 445 | 455 | 464 | 523 | 12.6% |
| SG&A | 339 | 348 | 355 | 367 | 415 | 13.2% |
| EBITDA | | | 138 | | | |
| Net Income | 58 | 65 | 64 | 63 | 70 | 11.0% |
Balance Sheet
|
|---|
| Cash | 27 | 39 | 22 | 29 | 37 | 27.9% |
| Short Term Debt | 1 | 40 | 78 | 6 | 0 | -100.0% |
| Long Term Debt | 175 | 123 | 105 | 195 | 225 | 15.6% |
Cash flow
|
|---|
| Capex | 46 | 42 | 40 | 49 | 63 | 28.7% |
Ratios
|
|---|
| Revenue growth | 3.2% | 1.2% | 1.9% | 5.3% | 10.6% | |
| Gross Margin | 28.6% | 29.4% | 29.5% | 28.6% | 29.1% | 0.5% |
| EBITDA Margin | 0.0% | 0.0% | 9.0% | 0.0% | 0.0% | 0.0% |
| Net Income Margin | 3.9% | 4.3% | 4.2% | 3.9% | 3.9% | 0.0% |
| SG&A, % of revenue | 22.7% | 23.0% | 23.0% | 22.6% | 23.1% | 0.5% |
| CAPEX, % of revenue | 3.0% | 2.8% | 2.6% | 3.0% | 3.5% | 0.5% |
| ROIC | 19.3% | 20.9% | 20.9% | 19.6% | 20.1% | 0.6% |
| ROE | 20.3% | 22.5% | 20.8% | 19.3% | 20.3% | 1.0% |
| Net Debt/EBITDA | | | 1.2x | | | 0.0x |
North West Co Inc/The ($NWC) key quoterly financial indicators
| mln. CAD | FY16Q1 | FY16Q2 | FY16Q3 | FY16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 414 | 449 | 458 | 475 | 10.0% | 11.9% | 10.8% | 9.6% |
| Net Income | 16 | 18 | 21 | 15 | 23.8% | 7.6% | 12.8% | 1.7% |
Balance Sheet
|
|---|
| Cash | 26 | 40 | 34 | 37 | -26.1% | 16.1% | 2.6% | 27.9% |
| Short Term Debt | 3 | 0 | 0 | 0 | -95.5% | -91.4% | -99.6% | -100.0% |
| Long Term Debt | 202 | 228 | 219 | 225 | 53.0% | 9.2% | 3.1% | 15.6% |
Ratios
|
|---|
| Gross Margin | 28.5% | 29.4% | 29.3% | 29.1% | -0.1% | 0.5% | 0.5% | 1.0% |
| Net Income Margin | 3.8% | 4.0% | 4.5% | 3.2% | 0.4% | -0.2% | 0.1% | -0.2% |
Revenue and profitability
The company's Revenue jumped on 10.6%. Revenue growth showed slow down in FY16Q4 - it was 9.6% YoY.
Gross Margin increased slightly on 0.52 pp from 28.6% to 29.1% in FY2016. SG&A as a % of Revenue increased slightly on 0.55 pp from 22.6% to 23.1% in FY2016.
Net Income marign showed almost no change in FY2016.
Capital expenditures (CAPEX) and working capital investments
North West Co Inc/The's CAPEX/Revenue was 3.5% in FY2016. CAPEX/Revenue increased slightly on 0.73 pp from 2.8% in FY2013 to 3.5% in FY2016. It's average CAPEX/Revenue for the last three years was 3.0%.
Return on investment
The company operates at high and attractive ROIC (20.13%) and ROE (20.32%). ROIC increased slightly on 0.58 pp from 19.6% to 20.1% in FY2016. ROE increased slightly on 1.0 pp from 19.3% to 20.3% in FY2016.
Leverage (Debt)
Debt jumped on 12.0% while cash jumped on 27.9%.
Management team
Edward S Kennedy is a North West Co Inc/The's CEO. Edward S Kennedy is a founder and has spent 22 years at the company. North West Co Inc/The's CFO John D King has spent 8 years at the company.
Appendix 1: Peers in Consumer, Non-cyclical
Below you can find North West Co Inc/The benchmarking vs. other companies in Consumer, Non-cyclical 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 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Medicure Inc ($MPH) | 32.2% | -45.7% | 94.1% | 337.2% | |
| CRH Medical Corp ($CRH) | 23.7% | 12.5% | 56.0% | 284.2% | |
| Concordia Healthcare Corp ($CXR) | | | 159.5% | 275.7% | |
| Nobilis Health Corp ($NHC) | 45.3% | 49.0% | 169.9% | 172.8% | |
| Nuvo Research Inc ($NRI) | 47.3% | -25.3% | -29.1% | 57.0% | |
| |
|---|
| Median (62 companies) | 10.6% | 9.1% | 14.5% | 15.7% | |
|---|
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Cipher Pharmaceuticals Inc ($CPH) | | 99.5% | 98.3% | 92.7% | |
| Medicure Inc ($MPH) | 77.7% | 74.4% | 82.8% | 89.8% | |
| Ritchie Bros Auctioneers Inc ($RBA) | 88.7% | 88.4% | 88.0% | 89.1% | |
| Information Services Corp ($ISV) | 77.5% | 80.4% | 80.9% | 87.6% | |
| Biosyent Inc ($RX) | 79.3% | 79.2% | 78.1% | 78.7% | |
| |
|---|
| Median (52 companies) | 40.9% | 39.2% | 39.1% | 36.1% | |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| CRH Medical Corp ($CRH) | 21.0% | 24.5% | 29.1% | 44.1% | |
| Ceapro Inc ($CZO) | -2.6% | 9.1% | 23.4% | 41.9% | |
| Valeant Pharmaceuticals International Inc ($VRX) | 30.6% | 27.8% | 45.6% | 39.8% | |
| Concordia Healthcare Corp ($CXR) | | 43.7% | 37.0% | 39.8% | |
| Ritchie Bros Auctioneers Inc ($RBA) | 36.8% | 36.3% | 36.4% | 39.7% | |
| |
|---|
| Median (61 companies) | 7.4% | 9.0% | 10.4% | 8.5% | |
|---|
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Feronia Inc/Canada ($FRN) | 191.4% | 117.4% | 42.4% | 81.0% | |
| Ceapro Inc ($CZO) | 3.9% | 35.3% | 52.0% | 39.4% | |
| ProMetic Life Sciences Inc ($PLI) | 2.1% | 33.6% | 34.6% | 23.3% | |
| EnerCare Inc ($ECI) | 25.7% | 26.5% | 23.6% | 20.7% | |
| BrightPath Early Learning Inc ($BPE) | 36.5% | 4.3% | 6.9% | 19.7% | |
| |
|---|
| Median (61 companies) | 3.1% | 2.7% | 2.7% | 2.3% | |
|---|
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Medicure Inc ($MPH) | | -127.1% | | 129.4% | |
| Response Biomedical Corp ($RBM) | -158.5% | | | 52.0% | |
| Ceapro Inc ($CZO) | -33.5% | 15.5% | 43.5% | 50.4% | |
| Biosyent Inc ($RX) | 71.7% | 62.4% | 62.9% | 48.2% | |
| Information Services Corp ($ISV) | 71.8% | 72.8% | 58.9% | 38.1% | |
| |
|---|
| Median (62 companies) | 7.3% | 7.1% | 7.3% | 5.2% | |
|---|
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Noble Iron Inc ($NIR) | 25.5x | 12.9x | 227.3x | 244.1x | |
| Family Memorials Inc ($FAM) | | | 15.2x | 84.3x | |
| Concordia Healthcare Corp ($CXR) | | -1.3x | 5.6x | 20.2x | |
| SunOpta Inc ($SOY) | 2.9x | 3.5x | 1.3x | 16.9x | |
| Centric Health Corp ($CHH) | 5.6x | 10.2x | 11.2x | 15.6x | |
| |
|---|
| Median (49 companies) | 3.1x | 2.3x | 3.3x | 2.8x | |
|---|
