Traverse Energy Ltd EBITDA surged on 185% in 2015 and EBITDA Margin jumped on 26.1 pp from 9.3% to 35.4%
14.04.2016 • About Traverse Energy Ltd (
$TVL) • By InTwits
Traverse Energy Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Traverse Energy Ltd doesn't have a profitable business model yet: 2015 ROIC is -8.6%
- EBITDA Margin is quite volatile: 35.4% in 2015, 9.3% in 2014, 63.3% in 2013, 43.2% in 2012, -9.3% in 2011
- Traverse Energy Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 148.6%. At the same time it's a lot of higher than industry average of 64.7%.
- CAPEX is quite volatile: 11.4 in 2015, 30.8 in 2014, 14.5 in 2013, 8.2 in 2012, 10.8 in 2011
- The company has unprofitable business model: ROIC is at -8.6%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Traverse Energy Ltd ($TVL) key annual financial indicators
| mln. CAD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 4.268 | 7.623 | 13.543 | 16.702 | 12.466 | -25.4% |
| Gross Profit | | | | | 1.147 | |
| SG&A | | 1.086 | 1.976 | 3.730 | 1.074 | -71.2% |
| EBITDA | -0.398 | 3.293 | 8.575 | 1.549 | 4.411 | 184.8% |
| Net Income | -1.822 | -2.828 | 3.245 | -4.570 | -2.762 | -39.6% |
Balance Sheet
|
|---|
| Cash | 4.231 | 3.268 | 4.994 | | 1.051 | |
| Short Term Debt | 0.000 | 0.000 | 0.000 | 1.440 | 0.000 | -100.0% |
| Long Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
Cash flow
|
|---|
| Capex | 10.763 | 8.216 | 14.460 | 30.821 | 11.444 | -62.9% |
Ratios
|
|---|
| Revenue growth | 111.0% | 78.6% | 77.7% | 23.3% | -25.4% | |
| EBITDA growth | -82.6% | -927.3% | 160.4% | -81.9% | 184.8% | |
| Gross Margin | | | | | 9.2% | 9.2% |
| EBITDA Margin | -9.3% | 43.2% | 63.3% | 9.3% | 35.4% | 26.1% |
| Net Income Margin | -42.7% | -37.1% | 24.0% | -27.4% | -22.2% | 5.2% |
| SG&A, % of revenue | | 14.3% | 14.6% | 22.3% | 8.6% | -13.7% |
| CAPEX, % of revenue | 252.2% | 107.8% | 106.8% | 184.5% | 91.8% | -92.7% |
| ROIC | -15.9% | -18.3% | 23.6% | -17.2% | -8.6% | 8.6% |
| ROE | -14.8% | -18.3% | 16.8% | -16.8% | -9.0% | 7.8% |
| Net Debt/EBITDA | | -1.0x | -0.6x | 0.9x | -0.2x | -1.2x |
Revenue and profitability
The company's Revenue dropped on 25.4% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin surged on 26.1 pp from 9.3% to 35.4% in 2015.
SG&A as a % of Revenue dropped on 13.7 pp from 22.3% to 8.6% in 2015.
Net Income marign increased on 5.2 pp from -27.4% to -22.2% in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 91.8% in 2015. The company showed big decline in CAPEX/Revenue of 16.0 pp from 108% in 2012 to 91.8% in 2015. For the last three years the average CAPEX/Revenue was 128%.The company has spent a lot to CAPEX (259% of EBITDA) which didn't stop revenue from falling.
Return on investment
The company operates at negative ROIC (-8.58%) and ROE (-8.96%). ROIC increased on 8.6 pp from -17.2% to -8.6% in 2015. ROE increased on 7.8 pp from -16.8% to -9.0% in 2015.
Leverage (Debt)
The company paid down all the debt in 2015. Cash surged.
Appendix 1: Peers in Energy
Below we provide Traverse Energy Ltd benchmarking against other companies in Energy 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 |
|---|
| ONEnergy Inc ($OEG) | | | | 6,002.6% | 231.5% |
| Toro Oil & Gas Ltd ($TOO) | | 25.2% | -4.6% | -35.6% | 113.4% |
| Ikkuma Resources Corp ($IKM) | | 17.0% | -4.5% | 1,231.1% | 100.3% |
| Seven Generations Energy Ltd ($VII) | | | 115.7% | 340.2% | 39.0% |
| Crown Point Energy Inc ($CWV) | | 177.6% | 110.5% | -34.4% | 38.3% |
| |
|---|
| Median (144 companies) | 59.0% | 9.4% | 17.3% | 18.7% | -28.6% |
|---|
| Traverse Energy Ltd ($TVL) | | 78.6% | 77.7% | 23.3% | -25.4% |
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% |
| Orca Exploration Group Inc ($ORC.B) | 69.1% | 92.3% | 69.0% | 66.3% | 93.1% |
| Serinus Energy Inc ($SEN) | 80.4% | 80.5% | 76.5% | 86.8% | 88.5% |
| Advantage Oil & Gas Ltd ($AAV) | 70.5% | 62.0% | 84.5% | 92.5% | 88.5% |
| |
|---|
| Median (130 companies) | 34.0% | 29.3% | 31.5% | 29.6% | 33.6% |
|---|
| Traverse Energy Ltd ($TVL) | | | | | 9.2% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Granite Oil Corp ($GXO) | 9.2% | 59.4% | 64.5% | 70.8% | 201.9% |
| Perpetual Energy Inc ($PMT) | 26.1% | 35.5% | 70.7% | 58.0% | 110.3% |
| Petro Rio SA ($PRJ) | -4,925.5% | -4,809.7% | -6,899.7% | 28.2% | 90.7% |
| Peyto Exploration & Development Corp ($PEY) | 83.6% | 86.1% | 83.2% | 86.3% | 84.6% |
| Innergex Renewable Energy Inc ($INE) | 109.4% | 111.8% | 110.0% | 82.9% | 83.4% |
| |
|---|
| Median (146 companies) | 25.7% | 24.2% | 31.1% | 29.7% | 5.7% |
|---|
| Traverse Energy Ltd ($TVL) | -9.3% | 43.2% | 63.3% | 9.3% | 35.4% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Primeline Energy Holdings Inc ($PEH) | | | | | 1,091.8% |
| Oryx Petroleum Corp Ltd ($OXC) | | | | 1,997.8% | 712.8% |
| WesternZagros Resources Ltd ($WZR) | | | | | 385.6% |
| Athabasca Oil Corp ($ATH) | 176.2% | 2,426.4% | 596.6% | 504.7% | 315.2% |
| Toro Oil & Gas Ltd ($TOO) | 192.4% | 139.0% | 39.2% | 808.7% | 307.4% |
| |
|---|
| Median (147 companies) | 42.6% | 48.7% | 39.2% | 48.6% | 31.0% |
|---|
| Traverse Energy Ltd ($TVL) | 252.2% | 107.8% | 106.8% | 184.5% | 91.8% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Granite Oil Corp ($GXO) | -10.9% | 4.4% | 10.8% | 16.1% | 37.7% |
| High Arctic Energy Services Inc ($HWO) | 27.0% | 31.4% | 26.3% | 24.9% | 24.2% |
| Petro Rio SA ($PRJ) | -15.5% | -9.6% | -12.7% | -3.5% | 19.4% |
| Orca Exploration Group Inc ($ORC.B) | 13.3% | 30.0% | 13.0% | 14.3% | 19.0% |
| Perpetual Energy Inc ($PMT) | -10.6% | -10.1% | 9.1% | 10.4% | 16.1% |
| |
|---|
| Median (147 companies) | 4.5% | 3.1% | 4.6% | 5.3% | -9.3% |
|---|
| Traverse Energy Ltd ($TVL) | -15.9% | -18.3% | 23.6% | -17.2% | -8.6% |
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 ($PGF) | 1.5x | 2.9x | 2.1x | 16.8x | |
| |
|---|
| Median (138 companies) | 1.2x | 1.6x | 1.5x | 1.4x | 2.6x |
|---|
| Traverse Energy Ltd ($TVL) | | -1.0x | -0.6x | 0.9x | -0.2x |
