Eldorado Gold Corp reports 1,602% Net Income decline and 55.1% Revenue decline
23.03.2016 • About Eldorado Gold Corp (
$ELD) • By InTwits
Eldorado Gold Corp reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Eldorado Gold Corp is a company in decline: 2015 revenue growth was -55.1%, 5 years revenue CAGR was -9.5%
- The company operates at negative EBITDA Margin: -360.6%
- Eldorado Gold Corp spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for 2011-2015 is 0.0%. Average EBITDA Margin for the same period was -7.7%0
- Eldorado Gold Corp has high CAPEX intensity: 5 year average CAPEX/Revenue was 43.2%. At the same time it's a lot of higher than industry average of 28.7%.
- CAPEX is quite volatile: 125 in 2015, 296 in 2014, 219 in 2013, 268 in 2012, 150 in 2011
- The company has unprofitable business model: ROIC is at -29.8%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Eldorado Gold Corp ($ELD) key annual financial indicators
| mln. $ | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 1,104 | 1,148 | 1,124 | 1,068 | 479 | -55.1% |
| Gross Profit | 757 | 720 | 493 | 369 | 126 | -66.0% |
| SG&A | 59 | 70 | 68 | 68 | 44 | -35.4% |
| EBITDA | 640 | 568 | -298 | 438 | -1,728 | -494.1% |
| Net Income | 319 | 305 | -653 | 103 | -1,541 | -1,601.7% |
Balance Sheet
|
|---|
| Cash | 394 | 817 | 589 | 499 | 288 | -42.2% |
| Short Term Debt | 81 | 10 | 16 | 16 | 0 | -100.0% |
| Long Term Debt | 0 | 583 | 585 | 587 | 589 | 0.4% |
Cash flow
|
|---|
| Capex | 275 | 426 | 482 | 411 | 347 | -15.5% |
Ratios
|
|---|
| Revenue growth | 39.5% | 4.0% | -2.1% | -5.0% | -55.1% | |
| EBITDA growth | 52.2% | -11.3% | -152.5% | -247.1% | -494.1% | |
| Gross Margin | 68.6% | 62.7% | 43.9% | 34.5% | 26.2% | -8.3% |
| EBITDA Margin | 58.0% | 49.5% | -26.5% | 41.0% | -360.6% | -401.6% |
| Net Income Margin | 28.9% | 26.6% | -58.1% | 9.6% | -321.6% | -331.2% |
| SG&A, % of revenue | 5.4% | 6.1% | 6.1% | 6.4% | 9.2% | 2.8% |
| CAPEX, % of revenue | 24.9% | 37.1% | 42.9% | 38.5% | 72.4% | 34.0% |
| ROIC | 14.3% | 8.0% | -6.1% | 3.7% | -29.8% | -33.6% |
| ROE | 10.3% | 6.6% | -11.7% | 2.0% | -34.1% | -36.0% |
| Net Debt/EBITDA | -0.5x | -0.4x | | 0.2x | | -0.2x |
Revenue and profitability
Eldorado Gold Corp's Revenue dropped on 55.1% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 9.4 pp from 16.9% to 26.2% in 2015.
Gross Margin decreased on 8.3 pp from 34.5% to 26.2% in 2015. SG&A as a % of Revenue increased on 2.8 pp from 6.4% to 9.2% in 2015.
Net Income marign dropped on 331 pp from 9.6% to -322% in 2015.
Capital expenditures (CAPEX) and working capital investments
Eldorado Gold Corp's CAPEX/Revenue was 72.4% in 2015. The company showed fast CAPEX/Revenue growth of 35.3 pp from 37.1% in 2012 to 72.4% in 2015. Average CAPEX/Revenue for the last three years was 51.3%.
Return on investment
The company operates at negative ROIC (-29.83%) and ROE (-34.07%). ROIC dropped on 33.6 pp from 3.7% to -29.8% in 2015. ROE dropped on 36.0 pp from 2.0% to -34.1% in 2015.
Leverage (Debt)
Debt level is -0.8x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA dropped on 0.2x from 0.2x to in 2015. Debt decreased on 2.3% in 2015 while cash dropped on 42.2% in 2015.
Management team
Paul N Wright is a the company's CEO. Paul N Wright is a founder and has spent 19 years at the company. The company's CFO Fabiana Chubbs has spent 7 years at the company.
Appendix 1: Peers in Basic Materials
Below we provide Eldorado Gold 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 |
|---|
| Barkerville Gold Mines Ltd ($BGM) | | 97.4% | -90.6% | -97.6% | 84,715.6% |
| Golden Minerals Co ($AUM) | | 1,320.8% | -59.1% | -97.8% | 3,334.5% |
| Jemi Fibre Corp ($JFI) | | | | -27.3% | 375.3% |
| Osisko Gold Royalties Ltd ($OR) | | | | | 164.4% |
| VMS Ventures Inc ($VMS) | | | | | 139.7% |
| |
|---|
| Median (114 companies) | 22.3% | 8.5% | -5.1% | -0.8% | -1.5% |
|---|
| Eldorado Gold Corp ($ELD) | | 4.0% | -2.1% | -5.0% | -55.1% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Royal Gold Inc ($RGL) | 68.9% | 71.5% | 70.6% | 57.6% | 86.0% |
| Nevsun Resources Ltd ($NSU) | 90.3% | 89.9% | 94.8% | 95.5% | 82.3% |
| 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% |
| Perseus Mining Ltd ($PRU) | | 52.5% | 50.9% | 32.0% | 53.7% |
| |
|---|
| Median (109 companies) | 30.1% | 31.5% | 20.7% | 16.8% | 15.5% |
|---|
| Eldorado Gold Corp ($ELD) | 68.6% | 62.7% | 43.9% | 34.5% | 26.2% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Labrador Iron Ore Royalty Corp ($LIF) | | | | | 72.8% |
| Silver Wheaton Corp ($SLW) | 84.8% | 82.6% | 75.3% | 69.6% | 65.8% |
| 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% | 60.8% |
| Lucara Diamond Corp ($LUC) | | 7.6% | 57.3% | 57.5% | 60.0% |
| |
|---|
| Median (114 companies) | 22.0% | 18.4% | 11.7% | 9.7% | 6.6% |
|---|
| Eldorado Gold Corp ($ELD) | 58.0% | 49.5% | -26.5% | 41.0% | -360.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Silver Wheaton Corp ($SLW) | 19.4% | 75.5% | 286.8% | 22.5% | 279.2% |
| Franco-Nevada Corp ($FNV) | 9.3% | 3.7% | 35.5% | 201.6% | 230.0% |
| Avino Silver & Gold Mines Ltd ($ASM) | | 211.7% | 5.6% | 89.8% | 163.3% |
| Amerigo Resources Ltd ($ARG) | 12.9% | 13.0% | 9.3% | 9.8% | 99.6% |
| Katanga Mining Ltd ($KAT) | 48.4% | 95.8% | 86.8% | 53.7% | 81.0% |
| |
|---|
| Median (114 companies) | 23.9% | 26.3% | 25.2% | 16.0% | 14.1% |
|---|
| Eldorado Gold Corp ($ELD) | 24.9% | 37.1% | 42.9% | 38.5% | 72.4% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Lucara Diamond Corp ($LUC) | -7.1% | -2.9% | 41.3% | 54.7% | 39.6% |
| Canfor Pulp Products Inc ($CFX) | 103.5% | 4.9% | 13.2% | 21.3% | 24.1% |
| Supremex Inc ($SXP) | 13.9% | 14.1% | 18.5% | 16.5% | 23.4% |
| Western Forest Products Inc ($WEF) | 7.5% | 9.0% | 25.1% | 15.7% | 16.4% |
| Mercer International Inc ($MRI.U) | 10.8% | 4.9% | 2.4% | 13.5% | 15.8% |
| |
|---|
| Median (116 companies) | 5.4% | 4.9% | 0.1% | -0.1% | -4.1% |
|---|
| Eldorado Gold Corp ($ELD) | 14.3% | 8.0% | -6.1% | 3.7% | -29.8% |
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 ($III) | -0.1x | 1.5x | 4.9x | 12.9x | |
| |
|---|
| Median (94 companies) | -0.0x | 0.3x | 0.8x | 0.9x | 1.3x |
|---|
| Eldorado Gold Corp ($ELD) | -0.5x | -0.4x | | 0.2x | |
