Paladin Energy Ltd reports 6.9% revenue decline in FY2016 and 41.5 pp EBITDA Margin growth from -132% to -90.2%
24.08.2016 • About Paladin Energy Ltd (
$PDN) • By InTwits
Paladin Energy Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Paladin Energy Ltd is a company in decline: FY2016 revenue growth was -6.9%, 5 years revenue CAGR was -7.1%
- The company operates at negative EBITDA Margin: -90.2%
- Paladin Energy Ltd spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for FY2012-FY2016 is 0.0%. Average EBITDA Margin for the same period was -84.3%0
- Paladin Energy Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 10.5%. At the same time it's a lot of higher than industry average of 24.1%.
- CAPEX is quite volatile: 8 in FY2016, 15.7 in FY2015, 20.3 in FY2014, 47.1 in FY2013, 82.2 in FY2012
- The company has unprofitable business model: ROIC is at -31.0%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Paladin Energy Ltd ($PDN) key annual financial indicators
| mln. $ | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 366.0 | 410.6 | 328.8 | 198.6 | 184.9 | -6.9% |
| Gross Profit | 22.5 | 24.1 | -65.8 | 0.9 | 13.2 | 1,366.7% |
| SG&A | 44.9 | 36.1 | 20.3 | 19.3 | 16.3 | -15.5% |
| EBITDA | -174.2 | -272.0 | -380.6 | -261.4 | -166.7 | |
| Net Income | -172.8 | -420.9 | -338.4 | -267.8 | -122.0 | |
Balance Sheet
|
|---|
| Cash | 85.9 | 52.4 | 75.6 | 152.5 | 59.2 | -61.2% |
| Short Term Debt | 183.4 | 63.6 | 39.4 | 8.5 | 215.1 | 2,430.6% |
| Long Term Debt | 655.1 | 614.2 | 686.2 | 526.0 | 214.1 | -59.3% |
Cash flow
|
|---|
| Capex | 82.2 | 47.1 | 20.3 | 15.7 | 8.0 | -49.0% |
Ratios
|
|---|
| Revenue growth | 36.8% | 12.2% | -19.9% | -39.6% | -6.9% | |
| EBITDA growth | 9,068.4% | 56.1% | 39.9% | -31.3% | -36.2% | |
| Gross Margin | 6.1% | 5.9% | -20.0% | 0.5% | 7.1% | 6.7% |
| EBITDA Margin | -47.6% | -66.2% | -115.8% | -131.6% | -90.2% | 41.5% |
| Net Income Margin | -47.2% | -102.5% | -102.9% | -134.8% | -66.0% | 68.9% |
| SG&A, % of revenue | 12.3% | 8.8% | 6.2% | 9.7% | 8.8% | -0.9% |
| CAPEX, % of revenue | 22.5% | 11.5% | 6.2% | 7.9% | 4.3% | -3.6% |
| ROIC | -10.2% | -17.7% | -30.8% | -28.2% | -31.0% | -2.8% |
| ROE | -14.3% | -46.8% | -60.9% | -75.5% | -63.9% | 11.6% |
Paladin Energy Ltd ($PDN) key quoterly financial indicators
| mln. $ | FY16Q1 | FY16Q2 | FY16Q3 | FY16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 37 | 64 | 21 | 63 | -5.6% | -8.3% | 22.6% | -13.1% |
| EBITDA | 4 | 14 | -1 | -184 | | 878.6% | | |
| Net Income | -16 | -8 | -15 | -83 | | | | |
Balance Sheet
|
|---|
| Cash | 108 | 101 | 21 | 59 | -37.6% | -66.8% | -95.3% | -61.2% |
| Short Term Debt | 9 | 9 | 0 | 215 | 0.0% | -97.2% | -100.0% | 2,430.6% |
| Long Term Debt | 512 | 496 | 425 | 214 | -25.9% | 23.7% | -19.3% | -59.3% |
Ratios
|
|---|
| Gross Margin | 30.4% | 18.9% | 9.2% | -19.2% | 27.3% | 15.7% | 6.8% | -15.1% |
| EBITDA Margin | 10.8% | 21.3% | -3.4% | -291.6% | 18.5% | 19.3% | 32.9% | 58.3% |
| Net Income Margin | -44.4% | -12.1% | -73.3% | -131.3% | 54.8% | 17.1% | 1.7% | 138.9% |
Revenue and profitability
The company's Revenue decreased on 6.9%. Revenue decline showed acceleration in FY16Q4 - it was 13.1% YoY. Revenue decline happened at the same time with EBITDA margin expansion. EBITDA Margin surged on 41.5 pp from -132% to -90.2% in FY2016.
Gross Margin increased on 6.7 pp from 0.45% to 7.1% in FY2016. SG&A as a % of Revenue decreased slightly on 0.90 pp from 9.7% to 8.8% in FY2016.
Net Income marign surged on 68.9 pp from -135% to -66.0% in FY2016.
Capital expenditures (CAPEX) and working capital investments
Paladin Energy Ltd's CAPEX/Revenue was 4.3% in FY2016. The company's CAPEX/Revenue decreased on 7.1 pp from 11.5% in FY2013 to 4.3% in FY2016. Average CAPEX/Revenue for the last three years was 6.1%.
Return on investment
The company operates at negative ROIC (-30.99%) and ROE (-63.94%). ROIC decreased on 2.8 pp from -28.2% to -31.0% in FY2016. ROE jumped on 11.6 pp from -75.5% to -63.9% in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is -0.7x and Debt / EBITDA is . Net Debt / EBITDA didn't change in FY2016. Debt dropped on 19.7% while cash dropped on 61.2%.
Management team
The company's CEO Alexander A Molyneux "Alex" is a founder and has spent 3 years at the company. The company's CFO Craig Clinton Barnes has spent 4 years at the company.
Appendix 1: Peers in Basic Materials
Below we provide Paladin Energy Ltd 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 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Avino Silver & Gold Mines Ltd ($ASM) | | 613.6% | 19.9% | -1.1% | 109.1% |
| Trevali Mining Corp ($TV) | | | | 12.9% | 86.4% |
| Geodrill Ltd ($GEO) | | -43.3% | -4.3% | 34.6% | 53.1% |
| Tahoe Resources Inc ($THO) | | | | 48.4% | 50.9% |
| Osisko Gold Royalties Ltd ($OR) | | | | 164.4% | 38.0% |
| |
|---|
| Median (83 companies) | 100.8% | -2.9% | 1.9% | -1.8% | 6.2% |
|---|
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Nevsun Resources Ltd ($NSU) | 89.9% | 94.8% | 95.5% | 82.3% | 79.7% |
| Labrador Iron Ore Royalty Corp ($LIF) | 80.2% | 80.2% | 80.2% | 80.3% | 80.3% |
| Lucara Diamond Corp ($LUC) | 42.5% | 57.4% | 66.7% | 60.9% | 65.6% |
| Trevali Mining Corp ($TV) | | | 49.0% | 59.3% | |
| Perseus Mining Ltd ($PRU) | 52.5% | 50.9% | 32.0% | 53.7% | 26.3% |
| |
|---|
| Median (95 companies) | 32.1% | 22.4% | 18.6% | 16.5% | 24.8% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Labrador Iron Ore Royalty Corp ($LIF) | | | | 72.8% | 73.5% |
| Silver Wheaton Corp ($SLW) | 82.6% | 75.3% | 69.6% | 65.8% | 59.7% |
| Franco-Nevada Corp ($FNV) | 62.1% | 44.6% | 72.3% | 60.8% | 70.3% |
| Lucara Diamond Corp ($LUC) | 7.6% | 57.3% | 57.5% | 60.0% | 62.4% |
| Sandstorm Gold Ltd ($SSL) | 74.3% | 49.9% | 62.1% | 56.5% | 64.6% |
| |
|---|
| Median (101 companies) | 18.6% | 11.3% | 10.6% | 7.0% | 23.5% |
|---|
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Largo Resources Ltd ($LGO) | | | | 567.6% | |
| Sandstorm Gold Ltd ($SSL) | 152.1% | 118.8% | 49.4% | 412.7% | 17.3% |
| Silver Wheaton Corp ($SLW) | 75.5% | 286.8% | 22.5% | 279.2% | 90.3% |
| Franco-Nevada Corp ($FNV) | 3.7% | 35.5% | 201.6% | 230.0% | 122.4% |
| Avino Silver & Gold Mines Ltd ($ASM) | 211.7% | 5.6% | 89.8% | 163.3% | |
| |
|---|
| Median (101 companies) | 27.8% | 26.9% | 17.5% | 16.7% | 17.9% |
|---|
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Lucara Diamond Corp ($LUC) | -2.9% | 41.3% | 54.7% | 39.6% | 58.5% |
| Western Forest Products Inc ($WEF) | 9.0% | 25.1% | 15.7% | 16.4% | 25.1% |
| Geodrill Ltd ($GEO) | 8.6% | -3.5% | -9.3% | 3.6% | 20.3% |
| Supremex Inc ($SXP) | 14.1% | 18.5% | 16.5% | 23.4% | 19.3% |
| Canfor Pulp Products Inc ($CFX) | 4.9% | 13.2% | 21.3% | 24.1% | 17.0% |
| |
|---|
| Median (100 companies) | 4.9% | 0.7% | 1.6% | -3.6% | 4.4% |
|---|
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Canam Group Inc ($CAM) | 4.2x | 2.6x | 3.2x | 1.8x | 13.9x |
| Taseko Mines Ltd ($TKO) | 7.4x | 5.9x | 10.2x | 5.9x | 11.0x |
| Methanex Corp ($MX) | 5.2x | 0.7x | 0.9x | 3.0x | 5.2x |
| Copper Mountain Mining Corp ($CUM) | 3.9x | 5.0x | 5.4x | 30.6x | 5.1x |
| Cameco Corp ($CCO) | 2.0x | 2.1x | 2.5x | 1.9x | 5.1x |
| |
|---|
| Median (58 companies) | 0.3x | 0.8x | 1.1x | 1.6x | 0.6x |
|---|
