Dalmac Energy Inc Net Debt / EBITDA jumped on 15.4x from 2.9x to 18.3x in 2016 while Debt dropped on 21.2%
29.08.2016 • About Dalmac Energy Inc (
$DAL) • By InTwits
Dalmac Energy Inc reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Dalmac Energy Inc is a company in decline: FY2016 revenue growth was -32.7%, 5 years revenue CAGR was -3.8%
- EBITDA Margin is quite volatile: 2.2% in FY2016, 11.2% in FY2015, 9.3% in FY2014, 12.1% in FY2013, 17.6% in FY2012
- Dalmac Energy Inc has medium CAPEX intensity: 5 year average CAPEX/Revenue was 9.6%. At the same time it's in pair with industry average of 8.1%.
- CAPEX is quite volatile: 1.5 in FY2016, 1.6 in FY2015, 4.2 in FY2014, 7.1 in FY2013, 2.6 in FY2012
- The company has unprofitable business model: ROIC is at -11.2%
- It operates with high leverage: Net Debt/EBITDA is 18.3x while industry average is 6.1x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Dalmac Energy Inc ($DAL) key annual financial indicators
| mln. CAD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 35.663 | 41.304 | 37.132 | 32.062 | 21.569 | -32.7% |
| Gross Profit | 8.933 | 10.395 | 5.398 | 8.889 | 4.968 | -44.1% |
| SG&A | | | | 5.312 | 3.451 | -35.0% |
| EBITDA | 6.265 | 4.984 | 3.445 | 3.577 | 0.472 | -86.8% |
| Net Income | 2.629 | 1.433 | -0.520 | -1.161 | -2.675 | |
Balance Sheet
|
|---|
| Cash | 1.364 | 0.454 | 0.526 | 1.610 | 0.870 | -46.0% |
| Short Term Debt | 7.682 | 1.133 | 0.891 | 1.151 | 8.568 | 644.2% |
| Long Term Debt | 2.541 | 12.596 | 13.992 | 10.942 | 0.965 | -91.2% |
Cash flow
|
|---|
| Capex | 2.607 | 7.140 | 4.165 | 1.595 | 1.521 | -4.7% |
Ratios
|
|---|
| Revenue growth | 35.9% | 15.8% | -10.1% | -13.7% | -32.7% | |
| EBITDA growth | 20.1% | -20.4% | -30.9% | 3.8% | -86.8% | |
| Gross Margin | 25.0% | 25.2% | 14.5% | 27.7% | 23.0% | -4.7% |
| EBITDA Margin | 17.6% | 12.1% | 9.3% | 11.2% | 2.2% | -9.0% |
| Net Income Margin | 7.4% | 3.5% | -1.4% | -3.6% | -12.4% | -8.8% |
| SG&A, % of revenue | | | | 16.6% | 16.0% | -0.6% |
| CAPEX, % of revenue | 7.3% | 17.3% | 11.2% | 5.0% | 7.1% | 2.1% |
| ROIC | 19.9% | 9.7% | 0.9% | 0.2% | -11.2% | -11.4% |
| ROE | 25.8% | 11.2% | -3.9% | -9.2% | -24.4% | -15.2% |
| Net Debt/EBITDA | 1.4x | 2.7x | 4.2x | 2.9x | 18.3x | 15.4x |
Dalmac Energy Inc ($DAL) key quoterly financial indicators
| mln. CAD | FY16Q1 | FY16Q2 | FY16Q3 | FY16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 5 | 6 | 6 | 4 | -25.9% | -33.6% | -36.1% | -34.1% |
| EBITDA | -0 | 1 | 0 | -1 | -118.5% | -30.6% | -47.2% | -255.3% |
| Net Income | -1 | -0 | -0 | -2 | | -134.7% | | |
Balance Sheet
|
|---|
| Cash | 1 | 0 | 0 | 1 | 24.7% | -49.9% | -88.1% | -46.0% |
| Short Term Debt | 1 | 1 | 10 | 9 | 26.4% | -13.0% | 864.3% | 644.2% |
| Long Term Debt | 11 | 11 | 1 | 1 | -12.8% | -6.4% | -90.8% | -91.2% |
Ratios
|
|---|
| Gross Margin | 16.3% | 30.2% | 23.6% | 21.1% | -6.2% | 0.7% | -0.6% | -15.0% |
| EBITDA Margin | -1.8% | 15.6% | 8.0% | -20.8% | -9.0% | 0.7% | -1.7% | -29.6% |
| Net Income Margin | -14.3% | -1.3% | -4.9% | -34.9% | -9.3% | -3.8% | -3.6% | -21.6% |
Revenue and profitability
The company's Revenue dropped on 32.7%. Revenue decline showed acceleration in FY16Q4 - it was 34.1% YoY. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 9.0 pp from 11.2% to 2.2% in FY2016.
Gross Margin decreased on 4.7 pp from 27.7% to 23.0% in FY2016. SG&A as a % of Revenue decreased slightly on 0.57 pp from 16.6% to 16.0% in FY2016.
Net Income marign decreased on 8.8 pp from -3.6% to -12.4% in FY2016.
Capital expenditures (CAPEX) and working capital investments
Dalmac Energy Inc's CAPEX/Revenue was 7.1% in FY2016. CAPEX/Revenue dropped on 10.2 pp from 17.3% in FY2013 to 7.1% in FY2016. Average CAPEX/Revenue for the last three years was 7.7%.Dalmac Energy Inc has spent a lot to CAPEX (322% of EBITDA) which didn't stop revenue from falling.
Return on investment
The company operates at negative ROIC (-11.15%) and ROE (-24.37%). ROIC dropped on 11.4 pp from 0.21% to -11.2% in FY2016. ROE dropped on 15.2 pp from -9.2% to -24.4% in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is 18.3x and Debt / EBITDA is 20.2x. Net Debt / EBITDA surged on 15.4x from 2.9x to 18.3x in FY2016. Debt dropped on 21.2% while cash dropped on 46.0%.
Appendix 1: Peers in Financial
Below you can find Dalmac Energy Inc 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% | |
| StorageVault Canada Inc ($SVI) | | 22.2% | 7.5% | 111.8% | |
| Slate Retail REIT ($SRT.UN) | | 316.8% | 229.7% | 92.5% | 21.6% |
| Mogo Finance Technology Inc ($GO) | | 13.7% | 34.6% | 86.0% | 14.6% |
| Morguard Corp ($MRC) | | 27.2% | 9.2% | 58.8% | 4.6% |
| |
|---|
| Median (54 companies) | | 7.1% | 9.0% | 3.3% | 5.2% |
|---|
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Olympia Financial Group Inc ($OLY) | 80.9% | 82.6% | 83.2% | 84.5% | 83.5% |
| Morguard Corp ($MRC) | 74.0% | 69.9% | 68.6% | 76.5% | 75.5% |
| 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 ($CKI) | 28.1% | 20.0% | 18.9% | 43.4% | 41.6% |
| |
|---|
| Median (9 companies) | 28.1% | 30.7% | 28.3% | 43.4% | 30.3% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Firm Capital Mortgage Investment Corp ($FC) | 87.6% | 87.9% | 88.8% | 86.6% | |
| Equitable Group Inc ($EQB) | 88.1% | 87.4% | 86.0% | 84.7% | 83.0% |
| Atrium Mortgage Investment Corp ($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 (37 companies) | 43.7% | 33.5% | 39.8% | 32.5% | 43.1% |
|---|
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% | 95.5% |
| First Capital Realty Inc ($FCR) | 127.9% | 76.1% | 73.8% | 56.7% | 79.7% |
| Killam Properties Inc ($KMP) | 80.7% | 114.1% | 143.5% | 46.7% | 59.9% |
| StorageVault Canada Inc ($SVI) | 150.5% | 73.3% | 79.1% | 21.4% | |
| |
|---|
| Median (56 companies) | 0.6% | 0.6% | 0.7% | 0.7% | 0.7% |
|---|
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| CI Financial Corp ($CIX) | | | | | 24.1% |
| FirstService Corp ($FSV) | | | | | 17.4% |
| IGM Financial Inc ($IGM) | 14.2% | 14.2% | 13.7% | 13.7% | 13.1% |
| Alaris Royalty Corp ($AD) | 9.5% | 10.1% | 10.7% | 7.3% | 12.3% |
| Genworth MI Canada Inc ($MIC) | 11.9% | 9.6% | 9.7% | 9.5% | 9.4% |
| |
|---|
| Median (56 companies) | 4.6% | 3.8% | 3.9% | 3.0% | 3.1% |
|---|
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Element Financial Corp ($EFN) | 140.2x | 31.9x | 37.6x | 79.9x | 22.6x |
| First National Financial Corp ($FN) | 34.3x | 33.7x | 40.9x | 37.4x | |
| StorageVault Canada Inc ($SVI) | 11.2x | 9.7x | 13.6x | 35.7x | |
| Gazit-Globe Ltd ($GZT) | 12.8x | 12.7x | 15.3x | 22.1x | 15.2x |
| Equitable Group Inc ($EQB) | 11.8x | 10.2x | 9.8x | 12.3x | 13.7x |
| |
|---|
| Median (28 companies) | 5.3x | 4.6x | 4.7x | 6.0x | 7.8x |
|---|
