Westbond Enterprises Corp EBITDA surged on 97.5% in 2016 and EBITDA Margin increased on 4.1 pp from 4.7% to 8.8%
21.06.2016 • About Westbond Enterprises Corp (
$WBE) • By InTwits
Westbond Enterprises Corp reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Westbond Enterprises Corp has high CAPEX intensity: 5 year average CAPEX/Revenue was 22.6%. At the same time it's a lot of higher than industry average of 3.1%.
- CAPEX is quite volatile: 4.6 in FY2016, 2.9 in FY2015, 0.31 in FY2014, 0.15 in FY2013, 0.46 in FY2012
- The company has potentially unprofitable business model: ROIC is at 2.5%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Westbond Enterprises Corp ($WBE) key annual financial indicators
| mln. CAD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 6.078 | 6.324 | 6.599 | 7.349 | 7.788 | 6.0% |
| Gross Profit | 1.292 | 1.352 | 1.343 | 1.368 | 1.444 | 5.6% |
| SG&A | | 1.189 | 1.221 | 1.364 | 1.243 | -8.9% |
| EBITDA | 0.442 | 0.480 | 0.454 | 0.348 | 0.687 | 97.5% |
| Net Income | 0.124 | 0.121 | 0.047 | -0.431 | 0.053 | |
Balance Sheet
|
|---|
| Cash | 0.098 | 0.076 | 1.638 | 0.096 | 0.117 | 21.6% |
| Short Term Debt | 0.555 | 0.354 | 0.044 | 0.358 | 0.518 | 44.6% |
| Long Term Debt | 0.000 | 0.000 | 0.000 | 0.291 | 4.583 | 1,476.9% |
Cash flow
|
|---|
| Capex | 0.462 | 0.150 | 0.309 | 2.901 | 4.593 | 58.3% |
Ratios
|
|---|
| Revenue growth | -0.1% | 4.0% | 4.3% | 11.4% | 6.0% | |
| EBITDA growth | 52.1% | 8.6% | -5.5% | -23.2% | 97.5% | |
| Gross Margin | 21.2% | 21.4% | 20.3% | 18.6% | 18.5% | -0.1% |
| EBITDA Margin | 7.3% | 7.6% | 6.9% | 4.7% | 8.8% | 4.1% |
| Net Income Margin | 2.0% | 1.9% | 0.7% | -5.9% | 0.7% | 6.5% |
| SG&A, % of revenue | | 18.8% | 18.5% | 18.6% | 16.0% | -2.6% |
| CAPEX, % of revenue | 7.6% | 2.4% | 4.7% | 39.5% | 59.0% | 19.5% |
| ROIC | 4.7% | 4.0% | 2.6% | 0.1% | 2.5% | 2.4% |
| ROE | 4.2% | 3.9% | 1.1% | -9.0% | 1.1% | 10.1% |
| Net Debt/EBITDA | 1.0x | 0.6x | -3.5x | 1.6x | 7.3x | 5.7x |
Westbond Enterprises Corp ($WBE) key quoterly financial indicators
| mln. CAD | FY16Q1 | FY16Q2 | FY16Q3 | FY16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 2 | 2 | 2 | 2 | 1.9% | 13.3% | 7.6% | 1.7% |
| EBITDA | 0 | 0 | 0 | 0 | 46.8% | 50.0% | | -14.1% |
| Net Income | 0 | 0 | 0 | -0 | | | | |
Balance Sheet
|
|---|
| Cash | 0 | 0 | 0 | 0 | -91.5% | -94.5% | -0.7% | 21.6% |
| Short Term Debt | 0 | 0 | 0 | 1 | 1,683.0% | -21.2% | -31.3% | 44.6% |
| Long Term Debt | 4 | 5 | 5 | 5 | | | | 1,476.9% |
Ratios
|
|---|
| Gross Margin | 17.8% | 19.3% | 23.3% | 13.7% | 0.9% | -0.6% | 5.9% | -6.5% |
| EBITDA Margin | 6.4% | 7.8% | 13.5% | 7.5% | 2.0% | 1.9% | 14.0% | -1.4% |
| Net Income Margin | 0.4% | 3.0% | 2.7% | -3.5% | 0.9% | 17.2% | 9.8% | -1.2% |
Revenue and profitability
The company's Revenue increased on 6.0%. Revenue growth showed slow down in FY16Q4 - it was 1.7% YoY. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 33.9 pp from -6.8% to -40.7% in FY2016.
Gross Margin showed almost no change in FY2016. SG&A as a % of Revenue decreased on 2.6 pp from 18.6% to 16.0% in FY2016.
Net Income marign increased on 6.5 pp from -5.9% to 0.68% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 Westbond Enterprises Corp had CAPEX/Revenue of 59.0%. CAPEX/Revenue surged on 56.6 pp from 2.4% in FY2013 to 59.0% in FY2016. It's average CAPEX/Revenue for the last three years was 34.4%.Westbond Enterprises Corp investments to CAPEX were large: 668% of EBITDA.
Return on investment
The company operates at low ROIC (2.49%) and ROE (1.13%). ROIC increased on 2.4 pp from 0.071% to 2.5% in FY2016. ROE surged on 10.1 pp from -9.0% to 1.1% in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is 7.3x and Debt / EBITDA is 7.4x. Net Debt / EBITDA jumped on 5.7x from 1.6x to 7.3x in FY2016. Debt jumped on 686% while cash surged on 21.6%.
Appendix 1: Peers in Consumer, Non-cyclical
Below you can find Westbond Enterprises Corp benchmarking vs. other companies in Consumer, Non-cyclical 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 |
|---|
| Concordia Healthcare Corp ($CXR) | | | 159.5% | 275.7% | 107.0% |
| Heritage Global Inc ($HGP) | | -37.0% | 76.2% | 11.2% | 80.8% |
| EnerCare Inc ($ECI) | | 8.6% | 21.1% | 55.7% | 76.6% |
| CRH Medical Corp ($CRH) | | 12.5% | 56.0% | 284.2% | 70.2% |
| Nuvo Research Inc ($NRI) | | -25.3% | -29.1% | 57.0% | 31.9% |
| |
|---|
| Median (41 companies) | | 8.6% | 13.8% | 15.2% | 12.8% |
|---|
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Cipher Pharmaceuticals Inc ($CPH) | | 99.5% | 98.3% | 92.7% | |
| Ritchie Bros Auctioneers Inc ($RBA) | 88.7% | 88.4% | 88.0% | 89.1% | 88.3% |
| Information Services Corp ($ISV) | 77.5% | 80.4% | 80.9% | 87.6% | 85.1% |
| Biosyent Inc ($RX) | 79.3% | 79.2% | 78.1% | 78.7% | |
| Concordia Healthcare Corp ($CXR) | | 79.4% | 86.0% | 76.1% | 72.9% |
| |
|---|
| Median (35 companies) | 32.5% | 37.1% | 35.7% | 35.7% | 31.1% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| CRH Medical Corp ($CRH) | 21.0% | 24.5% | 29.1% | 44.1% | |
| Valeant Pharmaceuticals International Inc ($VRX) | 30.6% | 27.8% | 45.6% | 39.8% | 23.8% |
| Concordia Healthcare Corp ($CXR) | | 43.7% | 37.0% | 39.8% | -92.8% |
| Ritchie Bros Auctioneers Inc ($RBA) | 36.8% | 36.3% | 36.4% | 39.7% | 31.4% |
| EnerCare Inc ($ECI) | 52.8% | 51.0% | 45.5% | 39.3% | 26.6% |
| |
|---|
| Median (44 companies) | 9.2% | 12.4% | 13.4% | 11.8% | 10.1% |
|---|
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| ProMetic Life Sciences Inc ($PLI) | 2.1% | 33.6% | 34.6% | 23.3% | |
| EnerCare Inc ($ECI) | 25.7% | 26.5% | 23.6% | 20.7% | 15.5% |
| Black Diamond Group Ltd ($BDI) | 61.9% | 27.5% | 31.0% | 17.6% | |
| easyhome Ltd ($EH) | 32.2% | 25.6% | 21.6% | 16.9% | 12.7% |
| K-Bro Linen Inc ($KBL) | 10.0% | 19.0% | 11.4% | 16.6% | |
| |
|---|
| Median (43 companies) | 3.1% | 2.7% | 2.3% | 2.4% | 2.1% |
|---|
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Information Services Corp ($ISV) | 71.8% | 72.8% | 58.9% | 38.1% | 27.6% |
| Colliers International Group Inc ($CIG) | 10.5% | 11.2% | 15.2% | 10.9% | 26.1% |
| Nuvo Research Inc ($NRI) | -11.6% | -17.4% | -37.9% | 12.9% | 20.8% |
| International Road Dynamics Inc ($IRD) | 0.9% | 6.7% | 4.4% | 10.6% | 16.5% |
| Premium Brands Holdings Corp ($PBH) | 10.3% | 9.9% | 6.9% | 12.6% | 15.3% |
| |
|---|
| Median (44 companies) | 8.8% | 8.4% | 8.4% | 6.9% | 8.0% |
|---|
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Concordia Healthcare Corp ($CXR) | | -1.3x | 5.6x | 20.2x | |
| SunOpta Inc ($SOY) | 2.9x | 3.5x | 1.3x | 16.9x | 140.8x |
| Centric Health Corp ($CHH) | 5.6x | 10.2x | 11.2x | 15.6x | |
| Sienna Senior Living Inc ($SIA) | 9.5x | 11.8x | 9.2x | 9.1x | 9.1x |
| Valeant Pharmaceuticals International Inc ($VRX) | 9.5x | 10.4x | 4.0x | 7.3x | 12.7x |
| |
|---|
| Median (38 companies) | 2.8x | 2.3x | 3.4x | 2.5x | 2.8x |
|---|
