Tamarack Valley Energy Ltd reports 80.6% CAPEX decline while 5.1% Revenue growth
24.03.2016 • About Tamarack Valley Energy Ltd (
$TVE) • By InTwits
Tamarack Valley Energy Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Tamarack Valley Energy Ltd doesn't have a profitable business model yet: 2015 ROIC is -5.8%
- Tamarack Valley Energy Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 167.1%. At the same time it's a lot of higher than industry average of 71.3%.
- CAPEX is quite volatile: 62.2 in 2015, 320 in 2014, 57.8 in 2013, 37.0 in 2012, 42.4 in 2011
- The company has unprofitable business model: ROIC is at -5.8%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Tamarack Valley Energy Ltd ($TVE) key annual financial indicators
| mln. CAD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 15.7 | 31.6 | 60.4 | 107.5 | 113.1 | 5.1% |
| Gross Profit | 1.7 | 3.1 | 19.4 | 31.2 | 14.0 | -55.1% |
| SG&A | | | | | 7.2 | |
| EBITDA | 6.7 | 13.8 | 37.0 | 62.2 | 36.0 | -42.2% |
| Net Income | -3.1 | -4.1 | 14.8 | -25.2 | -17.3 | -31.1% |
Balance Sheet
|
|---|
| Cash | 0.0 | 0.0 | 0.0 | 0.8 | 0.0 | -100.0% |
| Short Term Debt | 1.0 | 43.2 | 71.8 | 0.0 | 0.0 | |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 100.2 | 82.8 | -17.3% |
Cash flow
|
|---|
| Capex | 42.4 | 37.0 | 57.8 | 320.0 | 62.2 | -80.6% |
Ratios
|
|---|
| Revenue growth | 144.2% | 101.1% | 91.1% | 78.2% | 5.1% | |
| EBITDA growth | -471.7% | 105.3% | 167.2% | 68.3% | -42.2% | |
| Gross Margin | 11.1% | 9.8% | 32.1% | 29.0% | 12.4% | -16.6% |
| EBITDA Margin | 42.9% | 43.8% | 61.3% | 57.9% | 31.8% | -26.1% |
| Net Income Margin | -19.5% | -13.1% | 24.5% | -23.4% | -15.3% | 8.1% |
| SG&A, % of revenue | | | | | 6.4% | 6.4% |
| CAPEX, % of revenue | 269.9% | 117.1% | 95.8% | 297.6% | 55.0% | -242.5% |
| ROIC | -8.7% | -6.0% | 7.4% | 5.0% | -5.8% | -10.7% |
| ROE | -7.7% | -6.1% | 12.7% | -11.1% | -5.1% | 6.0% |
| Net Debt/EBITDA | 0.2x | 3.1x | 1.9x | 1.6x | 2.3x | 0.7x |
Revenue and profitability
Tamarack Valley Energy Ltd's Revenue increased on 5.1% in 2015. Revenue growth was financed by EBITDA margin decline. EBITDA Margin dropped on 26.1 pp from 57.9% to 31.8% in 2015.
Gross Margin dropped on 16.6 pp from 29.0% to 12.4% in 2015.
Net Income marign increased on 8.1 pp from -23.4% to -15.3% in 2015.
Capital expenditures (CAPEX) and working capital investments
Tamarack Valley Energy Ltd's CAPEX/Revenue was 55.0% in 2015. The company's CAPEX/Revenue dropped on 62.1 pp from 117% in 2012 to 55.0% in 2015. Average CAPEX/Revenue for the last three years was 149%.Tamarack Valley Energy Ltd maintained rich investment policy and has spent a lot to CAPEX (173% of EBITDA).
Return on investment
The company operates at negative ROIC (-5.75%) and ROE (-5.13%). ROIC dropped on 10.7 pp from 5.0% to -5.8% in 2015. ROE increased on 6.0 pp from -11.1% to -5.1% in 2015.
Leverage (Debt)
Debt level is 2.3x Net Debt / EBITDA and 2.3x Debt / EBITDA. Net Debt / EBITDA jumped on 0.7x from 1.6x to 2.3x in 2015. Debt dropped on 17.3% in 2015 while cash dropped on 100% in 2015.
Appendix 1: Peers in Energy
Below you can find Tamarack Valley Energy Ltd benchmarking vs. other companies in Energy 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 |
|---|
| Petro Rio SA ($PRJ) | | -32.1% | -34.9% | 10,977.1% | -48.0% |
| ONEnergy Inc ($OEG) | | | | 6,002.6% | 231.5% |
| Sterling Resources Ltd ($SLG) | | -94.8% | 4,514.9% | 2,244.4% | |
| Ikkuma Resources Corp ($IKM) | 22.5% | 17.0% | -4.5% | 1,231.1% | |
| Spartan Energy Corp ($SPE) | | 16.6% | 29.9% | 923.7% | -3.7% |
| |
|---|
| Median (162 companies) | 51.2% | 9.4% | 17.1% | 18.5% | -27.5% |
|---|
| Tamarack Valley Energy Ltd ($TVE) | | 101.1% | 91.1% | 78.2% | 5.1% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Americas Petrogas Inc ($BOE) | | 77.1% | 43.3% | -34.3% | 121.1% |
| TransAlta Renewables Inc ($RNW) | | | 94.4% | 94.5% | 94.5% |
| Serinus Energy Inc ($SEN) | 80.4% | 80.5% | 76.5% | 86.8% | 88.5% |
| Advantage Oil & Gas Ltd ($AAV) | 70.5% | 62.0% | 84.5% | 92.5% | 88.5% |
| Polaris Infrastructure Inc ($PIF) | 58.4% | 39.9% | 33.6% | 32.0% | 86.7% |
| |
|---|
| Median (113 companies) | 34.3% | 29.7% | 31.5% | 30.3% | 36.2% |
|---|
| Tamarack Valley Energy Ltd ($TVE) | 11.1% | 9.8% | 32.1% | 29.0% | 12.4% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Seven Generations Energy Ltd ($VII) | | 56.9% | 54.0% | 106.0% | 70.0% |
| Tourmaline Oil Corp ($TOU) | 67.4% | 67.9% | 80.0% | 97.6% | 70.1% |
| Bonavista Energy Corp ($BNP) | 63.8% | 64.6% | 62.6% | 91.6% | 54.5% |
| Bellatrix Exploration Ltd ($BXE) | 42.7% | 58.6% | 83.6% | 89.6% | -115.8% |
| Advantage Oil & Gas Ltd ($AAV) | -4.0% | 5.2% | 66.1% | 87.8% | 81.8% |
| |
|---|
| Median (161 companies) | 25.5% | 24.6% | 31.1% | 29.6% | 7.2% |
|---|
| Tamarack Valley Energy Ltd ($TVE) | 42.9% | 43.8% | 61.3% | 57.9% | 31.8% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Oryx Petroleum Corp Ltd ($OXC) | | | | 1,997.8% | 712.8% |
| Petroshale Inc ($PSH) | 30.6% | | 346.6% | 865.9% | |
| Toro Oil & Gas Ltd ($TOO) | 192.4% | 139.0% | 39.2% | 808.7% | |
| Athabasca Oil Corp ($ATH) | 176.2% | 2,426.4% | 596.6% | 504.7% | 315.2% |
| BNK Petroleum Inc ($BKX) | 139.2% | 195.8% | 789.1% | 316.6% | 52.8% |
| |
|---|
| Median (164 companies) | 42.0% | 50.0% | 39.2% | 48.8% | 31.6% |
|---|
| Tamarack Valley Energy Ltd ($TVE) | 269.9% | 117.1% | 95.8% | 297.6% | 55.0% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Pason Systems Inc ($PSI) | 33.5% | 30.0% | 29.7% | 41.0% | 6.0% |
| Sea Dragon Energy Inc ($SDX) | -10.1% | 8.1% | 21.8% | 32.9% | |
| Raging River Exploration Inc ($RRX) | | | | 29.1% | 6.2% |
| High Arctic Energy Services Inc ($HWO) | 27.0% | 31.4% | 26.3% | 24.9% | 24.2% |
| Rooster Energy Ltd ($COQ) | | | | 22.9% | |
| |
|---|
| Median (167 companies) | 4.5% | 3.2% | 4.5% | 5.3% | -8.4% |
|---|
| Tamarack Valley Energy Ltd ($TVE) | -8.7% | -6.0% | 7.4% | 5.0% | -5.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Veresen Inc ($VSN) | 22.3x | 16.2x | 14.7x | 30.3x | 7.4x |
| Lightstream Resources Ltd ($LTS) | | 2.0x | | 27.8x | |
| Petroshale Inc ($PSH) | 0.1x | | | 21.7x | |
| Connacher Oil and Gas Ltd ($CLC) | 9.7x | 16.7x | 8.8x | 17.1x | |
| Pengrowth Energy Corp ($PGF) | 1.5x | 2.9x | 2.1x | 16.8x | |
| |
|---|
| Median (138 companies) | 1.2x | 1.6x | 1.5x | 1.3x | 2.8x |
|---|
| Tamarack Valley Energy Ltd ($TVE) | 0.2x | 3.1x | 1.9x | 1.6x | 2.3x |
