Wall Financial Corp Net Income surged on 200% in 2016 and Revenue surged on 96.6%
21.04.2016 • About Wall Financial Corp (
$WFC) • By InTwits
Wall Financial Corp reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Wall Financial Corp has high CAPEX intensity: 5 year average CAPEX/Revenue was 26.9%. At the same time it's a lot of higher than industry average of 5.0%.
- CAPEX is quite volatile: 52.6 in FY2016, 44.3 in FY2015, 16.9 in FY2014, 7.0 in FY2013, 37.3 in FY2012
- The company has potentially unprofitable business model: ROIC is at 3.5%
- It operates with high leverage: Net Debt/EBITDA is 17.2x while industry average is 10.2x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Wall Financial Corp ($WFC) key annual financial indicators
| mln. CAD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 275.5 | 71.3 | 274.9 | 67.8 | 133.2 | 96.6% |
| EBITDA | 73.5 | 17.5 | 63.4 | 18.3 | 30.0 | 63.9% |
| Net Income | 24.7 | 11.0 | 25.3 | 7.8 | 23.2 | 199.5% |
Balance Sheet
|
|---|
| Cash | 9.0 | 10.7 | 15.0 | 39.8 | 16.0 | -59.8% |
| Short Term Debt | 0.0 | 42.0 | 80.8 | 50.8 | | -100.0% |
| Long Term Debt | 258.1 | 317.1 | 228.9 | 357.9 | 531.1 | 48.4% |
Cash flow
|
|---|
| Capex | 37.3 | 7.0 | 16.9 | 44.3 | 52.6 | 18.9% |
Ratios
|
|---|
| Revenue growth | 35.2% | -74.1% | 285.4% | -75.3% | 96.6% | |
| EBITDA growth | 61.4% | -76.2% | 262.5% | -71.1% | 63.9% | |
| EBITDA Margin | 26.7% | 24.5% | 23.1% | 27.0% | 22.5% | -4.5% |
| Net Income Margin | 9.0% | 15.5% | 9.2% | 11.4% | 17.4% | 6.0% |
| CAPEX, % of revenue | 13.5% | 9.8% | 6.1% | 65.3% | 39.5% | -25.8% |
| ROIC | 17.3% | 3.0% | 12.7% | 2.1% | 3.5% | 1.4% |
| ROE | 29.5% | 14.0% | 28.7% | 8.6% | 24.4% | 15.7% |
| Net Debt/EBITDA | 3.4x | 19.9x | 4.6x | 20.1x | 17.2x | -3.0x |
Wall Financial Corp ($WFC) key quoterly financial indicators
| mln. CAD | FY16Q1 | FY16Q2 | FY16Q3 | FY16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 16 | 23 | 22 | 72 | 17.5% | 18.0% | 11.1% | 387.4% |
| EBITDA | 3 | 9 | 8 | 11 | 14.2% | 26.4% | 4.0% | 185.2% |
| Net Income | -0 | 4 | 4 | 16 | | 6.7% | 25.6% | 662.3% |
Balance Sheet
|
|---|
| Cash | 39 | 23 | 17 | 16 | 206.1% | -34.6% | -54.6% | -59.8% |
| Short Term Debt | 51 | 0 | 0 | 0 | -36.8% | | | -100.0% |
| Long Term Debt | 403 | 480 | 521 | 531 | 87.2% | 41.5% | 44.6% | 48.4% |
Ratios
|
|---|
| EBITDA Margin | 17.0% | 37.4% | 34.5% | 15.4% | -0.5% | 2.5% | -2.4% | -10.9% |
| Net Income Margin | -1.0% | 17.6% | 16.3% | 21.8% | 6.1% | -1.9% | 1.9% | 7.9% |
Revenue and profitability
The company's Revenue surged on 96.6%. Revenue growth showed acceleration in FY16Q4 - it increased 387.4% YoY. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 3.1 pp from -14.3% to -17.5% in FY2016.
Net Income marign increased on 6.0 pp from 11.4% to 17.4% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 Wall Financial Corp had CAPEX/Revenue of 39.5%. Wall Financial Corp showed fast CAPEX/Revenue growth of 29.8 pp from 9.8% in FY2013 to 39.5% in FY2016. Average CAPEX/Revenue for the last three years was 37.0%.The company has spent a lot to CAPEX (175% of EBITDA) to secure its growth.
Return on investment
The company operates at good ROE (24.35%) while ROIC is low (3.48%). ROIC increased slightly on 1.4 pp from 2.1% to 3.5% in FY2016. ROE surged on 15.7 pp from 8.6% to 24.4% in FY2016.
Appendix 1: Peers in Financial
Below you can find Wall Financial Corp benchmarking vs. other companies in Financial 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 |
|---|
| Grenville Strategic Royalty Corp ($GRC) | | | | 317.2% | |
| Starrex International Ltd ($STX) | | | | 204.1% | |
| StorageVault Canada Inc ($SVI) | | 22.2% | 7.5% | 111.8% | |
| IOU Financial Inc ($IOU) | 562.1% | 331.7% | 52.2% | 94.3% | |
| Mogo Finance Technology Inc ($GO) | | 13.7% | 34.6% | 86.0% | |
| |
|---|
| Median (59 companies) | 7.3% | 7.9% | 9.2% | 4.4% | 7.2% |
|---|
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Olympia Financial Group Inc ($OLY) | 80.9% | 82.6% | 83.2% | 84.5% | |
| Morguard Corp ($MRC) | 74.0% | 69.9% | 68.6% | 76.5% | |
| Mogo Finance Technology Inc ($GO) | 70.4% | 64.5% | 63.4% | 62.3% | |
| StorageVault Canada Inc ($SVI) | 18.2% | 22.6% | 18.3% | 52.4% | |
| Clarke Inc ($CKI) | 28.1% | 20.0% | 18.9% | 43.4% | |
| |
|---|
| Median (11 companies) | 25.6% | 30.7% | 28.3% | 41.0% | |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Firm Capital Mortgage Investment Corp ($FC) | 87.6% | 87.9% | 88.8% | 86.6% | |
| Equitable Group Inc ($EQB) | 88.1% | 87.4% | 86.0% | 84.7% | |
| Atrium Mortgage Investment Corp ($AI) | 79.8% | | | 81.9% | 83.2% |
| Trez Capital Mortgage Investment Corp ($TZZ) | | | | 76.2% | |
| First National Financial Corp ($FN) | 67.8% | 76.5% | 77.1% | 74.6% | |
| |
|---|
| Median (43 companies) | 34.3% | 31.9% | 28.8% | 27.0% | 72.4% |
|---|
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Dundee Corp ($DC.A) | 10.3% | 14.1% | 88.8% | 123.6% | |
| Gazit-Globe Ltd ($GZT) | 80.2% | 43.3% | 52.1% | 69.3% | |
| First Capital Realty Inc ($FCR) | 127.9% | 76.1% | 73.8% | 56.7% | |
| Killam Properties Inc ($KMP) | 80.7% | 114.1% | 143.5% | 46.7% | |
| StorageVault Canada Inc ($SVI) | 150.5% | 73.3% | 79.1% | 21.4% | |
| |
|---|
| Median (61 companies) | 0.6% | 0.6% | 0.7% | 1.0% | 0.0% |
|---|
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Brookfield Real Estate Services Inc ($BRE) | 26.0% | 31.0% | 47.0% | 61.0% | |
| Redishred Capital Corp ($KUT) | -24.5% | 6.5% | 15.8% | 19.7% | |
| Grenville Strategic Royalty Corp ($GRC) | -10.8% | -10.1% | -11.6% | 18.1% | |
| IGM Financial Inc ($IGM) | 14.2% | 14.2% | 13.7% | 13.7% | |
| Chesswood Group Ltd ($CHW) | 15.0% | 14.8% | 11.8% | 9.8% | |
| |
|---|
| Median (61 companies) | 4.4% | 4.3% | 3.9% | 2.6% | 6.9% |
|---|
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Element Financial Corp ($EFN) | 140.2x | 31.9x | 37.6x | 79.9x | |
| First National Financial Corp ($FN) | 34.3x | 33.7x | 40.9x | 37.4x | |
| StorageVault Canada Inc ($SVI) | 11.2x | 9.7x | 13.6x | 35.7x | |
| IOU Financial Inc ($IOU) | | 7.3x | | 31.7x | |
| Gazit-Globe Ltd ($GZT) | 12.8x | 12.7x | 15.3x | 22.1x | |
| |
|---|
| Median (32 companies) | 5.3x | 5.0x | 4.5x | 6.0x | 1.2x |
|---|
