Centamin Net Income dropped on 36.8% in 2015 and EBITDA Margin decreased on 5.3 pp from 35.6% to 30.4%
21.03.2016 • About Centamin (
$CEE) • By InTwits
Centamin reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is declining: 30.4% in 2015 vs. 35.6% in 2014 vs. 61.9% in 2011
- Centamin has high CAPEX intensity: 5 year average CAPEX/Revenue was 37.1%. At the same time it's a lot of higher than industry average of 20.9%.
- CAPEX is quite volatile: 70.9 in 2015, 88.5 in 2014, 281 in 2013, 238 in 2012, 140 in 2011
- The company has potentially unprofitable business model: ROIC is at 4.5%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Centamin ($CEE) key annual financial indicators
| mln. $ | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 340.5 | 426.1 | 503.8 | 472.6 | 508.4 | 7.6% |
| Gross Profit | 212.3 | 256.3 | 226.4 | 114.3 | 92.2 | -19.4% |
| SG&A | 5.3 | 15.0 | 11.4 | 9.1 | 0.6 | -93.0% |
| EBITDA | 210.8 | 261.6 | 226.2 | 168.3 | 154.3 | -8.3% |
| Net Income | 194.0 | 232.2 | 184.0 | 81.6 | 51.6 | -36.8% |
Balance Sheet
|
|---|
| Cash | 164.2 | 147.1 | 106.0 | 125.7 | 199.6 | 58.9% |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 139.6 | 238.1 | 281.4 | 88.5 | 70.9 | -19.9% |
Ratios
|
|---|
| Revenue growth | 817.1% | 25.2% | 18.2% | -6.2% | 7.6% | |
| EBITDA growth | 754.1% | 24.1% | -13.5% | -25.6% | -8.3% | |
| Gross Margin | 62.3% | 60.2% | 44.9% | 24.2% | 18.1% | -6.1% |
| EBITDA Margin | 61.9% | 61.4% | 44.9% | 35.6% | 30.4% | -5.3% |
| Net Income Margin | 57.0% | 54.5% | 36.5% | 17.3% | 10.1% | -7.1% |
| SG&A, % of revenue | 1.6% | 3.5% | 2.3% | 1.9% | 0.1% | -1.8% |
| CAPEX, % of revenue | 41.0% | 55.9% | 55.8% | 18.7% | 14.0% | -4.8% |
| ROIC | 30.2% | 24.6% | 15.7% | 6.6% | 4.5% | -2.1% |
| ROE | 30.5% | 25.3% | 16.5% | 6.4% | 3.8% | -2.6% |
| Net Debt/EBITDA | -0.8x | -0.6x | -0.5x | -0.7x | -1.3x | -0.5x |
Revenue and profitability
The company's Revenue increased on 7.6% in 2015. Revenue growth was financed by EBITDA margin decline. EBITDA Margin decreased on 5.3 pp from 35.6% to 30.4% in 2015.
Gross Margin decreased on 6.1 pp from 24.2% to 18.1% in 2015. SG&A as a % of Revenue decreased slightly on 1.8 pp from 1.9% to 0.12% in 2015.
Net Income marign decreased on 7.1 pp from 17.3% to 10.1% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 Centamin had CAPEX/Revenue of 14.0%. Centamin showed big decline in CAPEX/Revenue of 41.9 pp from 55.9% in 2012 to 14.0% in 2015. Average CAPEX/Revenue for the last three years was 29.5%.
Return on investment
The company operates at low ROIC (4.48%) and ROE (3.84%). ROIC decreased on 2.1 pp from 6.6% to 4.5% in 2015. ROE decreased on 2.6 pp from 6.4% to 3.8% in 2015.
Leverage (Debt)
The company has no debt. Cash surged on 58.9% in 2015.
Management team
Centamin's CEO is Andrew Pardey "Andy". Andrew Pardey "Andy" is a founder and has 3 years tenure at the company.
Appendix 1: Peers in Mining
Below you can find Centamin benchmarking vs. other companies in Mining 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 |
|---|
| Rambler Metals & Mining ($RAB) | | -65.4% | 2,744.1% | 79.2% | -34.2% |
| Kirkland Lake Gold Inc ($KGI) | | 54.7% | -5.1% | 14.2% | 26.9% |
| China Gold International Resources Corp Ltd ($CGG) | | | -9.0% | -8.2% | 22.4% |
| Caledonia Mining Corp ($CAL) | | 33.6% | -16.0% | -15.4% | -28.3% |
| Minera Irl Ltd ($IRL) | 29.0% | -13.2% | -22.4% | -16.4% | |
| |
|---|
| Median (7 companies) | 15.1% | 2.9% | -5.1% | -15.4% | -18.0% |
|---|
| Centamin ($CEE) | | 25.2% | 18.2% | -6.2% | 7.6% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Rambler Metals & Mining ($RAB) | 50.2% | 44.7% | 39.6% | 52.2% | 30.6% |
| China Gold International Resources Corp Ltd ($CGG) | | 37.6% | 33.7% | 35.6% | 18.5% |
| Caledonia Mining Corp ($CAL) | 57.6% | 54.4% | 45.9% | 34.7% | 26.9% |
| Minera Irl Ltd ($IRL) | 47.3% | 41.0% | 20.7% | 22.7% | |
| Orosur Mining Inc ($OMI) | 33.9% | 21.8% | 7.8% | 9.3% | -5.8% |
| |
|---|
| Median (7 companies) | 40.6% | 39.7% | 27.2% | 22.7% | 22.8% |
|---|
| Centamin ($CEE) | 62.3% | 60.2% | 44.9% | 24.2% | 18.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Gold International Resources Corp Ltd ($CGG) | | 41.7% | 38.3% | 47.3% | 33.7% |
| Rambler Metals & Mining ($RAB) | -26.1% | -194.4% | 29.6% | 45.1% | 20.5% |
| Orosur Mining Inc ($OMI) | 29.0% | 14.8% | 17.3% | 27.9% | -49.7% |
| Caledonia Mining Corp ($CAL) | 49.0% | 31.9% | 38.9% | 27.1% | 18.3% |
| Kirkland Lake Gold Inc ($KGI) | 25.6% | 34.9% | 16.4% | 13.6% | 32.5% |
| |
|---|
| Median (8 companies) | 29.0% | 31.9% | 29.6% | 20.3% | 20.5% |
|---|
| Centamin ($CEE) | 61.9% | 61.4% | 44.9% | 35.6% | 30.4% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Gold International Resources Corp Ltd ($CGG) | | 64.7% | 156.1% | 95.6% | 81.4% |
| Kirkland Lake Gold Inc ($KGI) | 54.9% | 44.6% | 72.9% | 47.7% | 21.6% |
| Serabi Gold ($SBI) | 3,151.4% | | | 44.5% | |
| Orosur Mining Inc ($OMI) | 34.7% | 53.8% | 29.6% | 14.1% | 19.7% |
| Rambler Metals & Mining ($RAB) | 640.5% | 820.8% | 24.2% | 13.9% | 20.7% |
| |
|---|
| Median (8 companies) | 34.7% | 44.6% | 24.2% | 14.0% | 21.6% |
|---|
| Centamin ($CEE) | 41.0% | 55.9% | 55.8% | 18.7% | 14.0% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Caledonia Mining Corp ($CAL) | 61.7% | 37.6% | 34.9% | 18.1% | 8.4% |
| Rambler Metals & Mining ($RAB) | -1.5% | -2.6% | 3.3% | 16.7% | 0.5% |
| Orosur Mining Inc ($OMI) | 22.0% | 3.8% | -1.5% | 4.5% | -84.1% |
| China Gold International Resources Corp Ltd ($CGG) | | 5.9% | 4.0% | 3.0% | 1.5% |
| Minera Irl Ltd ($IRL) | 13.6% | 6.0% | -0.4% | -0.0% | |
| |
|---|
| Median (8 companies) | 11.3% | 4.9% | 2.4% | 1.5% | 1.5% |
|---|
| Centamin ($CEE) | 30.2% | 24.6% | 15.7% | 6.6% | 4.5% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Minera Irl Ltd ($IRL) | -0.0x | 1.0x | 4.2x | 10.0x | |
| China Gold International Resources Corp Ltd ($CGG) | | 0.2x | 3.4x | 4.7x | 7.3x |
| Kirkland Lake Gold Inc ($KGI) | -1.0x | -0.3x | 3.2x | 4.1x | 0.6x |
| Rambler Metals & Mining ($RAB) | | | 2.5x | 0.6x | 2.4x |
| Orosur Mining Inc ($OMI) | -0.6x | -0.4x | 0.2x | -0.3x | |
| |
|---|
| Median (6 companies) | -0.6x | -0.3x | 2.5x | 2.4x | 1.5x |
|---|
| Centamin ($CEE) | -0.8x | -0.6x | -0.5x | -0.7x | -1.3x |
