New West Energy Services Inc revenue dropped on 44.6% in 2016 and EBITDA Margin decreased slightly on 1.4 pp from -0.14% to -1.6%
29.08.2016 • About New West Energy Services Inc (
$NWE) • By InTwits
New West Energy Services Inc reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- New West Energy Services Inc doesn't have a profitable business model yet: FY2016 ROIC is -14.7%
- The company operates at negative EBITDA Margin: -1.6%
- EBITDA Margin is quite volatile: -1.6% in FY2016, -0.1% in FY2015, 4.3% in FY2014, 8.1% in FY2013, 9.7% in FY2012
- New West Energy Services Inc has medium CAPEX intensity: 5 year average CAPEX/Revenue was 5.1%. At the same time it's a lot of higher than industry average of 23.0%.
- CAPEX is quite volatile: 0.20 in FY2016, 0.53 in FY2015, 1.4 in FY2014, 2.1 in FY2013, 0.63 in FY2012
- The company has unprofitable business model: ROIC is at -14.7%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
New West Energy Services Inc ($NWE) key annual financial indicators
| mln. CAD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 15.348 | 19.347 | 21.975 | 21.836 | 12.097 | -44.6% |
| Gross Profit | 4.704 | 5.608 | 5.466 | 4.616 | 3.189 | -30.9% |
| SG&A | | | | 4.647 | 3.379 | -27.3% |
| EBITDA | 1.494 | 1.561 | 0.939 | -0.031 | -0.190 | |
| Net Income | 4.269 | 1.628 | -0.015 | -3.772 | -1.775 | |
Balance Sheet
|
|---|
| Cash | 4.525 | 2.366 | 0.289 | 0.354 | 0.179 | -49.4% |
| Short Term Debt | 0.119 | 0.063 | 4.673 | 2.823 | 1.377 | -51.2% |
| Long Term Debt | 0.079 | 0.116 | 1.587 | 3.093 | 2.125 | -31.3% |
Cash flow
|
|---|
| Capex | 0.632 | 2.150 | 1.398 | 0.527 | 0.203 | -61.5% |
Ratios
|
|---|
| Revenue growth | 48.1% | 26.1% | 13.6% | -0.6% | -44.6% | |
| EBITDA growth | 83.0% | 4.5% | -39.8% | -103.3% | 503.0% | |
| Gross Margin | 30.7% | 29.0% | 24.9% | 21.1% | 26.4% | 5.2% |
| EBITDA Margin | 9.7% | 8.1% | 4.3% | -0.1% | -1.6% | -1.4% |
| Net Income Margin | 27.8% | 8.4% | -0.1% | -17.3% | -14.7% | 2.6% |
| SG&A, % of revenue | | | | 21.3% | 27.9% | 6.6% |
| CAPEX, % of revenue | 4.1% | 11.1% | 6.4% | 2.4% | 1.7% | -0.7% |
| ROIC | 21.6% | 12.8% | 1.4% | -10.2% | -14.7% | -4.5% |
| ROE | 77.2% | 18.7% | -0.2% | -46.8% | -31.7% | 15.1% |
| Net Debt/EBITDA | -2.9x | -1.4x | 6.4x | | | 0.0x |
New West Energy Services Inc ($NWE) key quoterly financial indicators
| mln. CAD | FY16Q1 | FY16Q2 | FY16Q3 | FY16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 3 | 3 | 4 | 3 | -43.3% | -60.7% | -45.2% | -11.2% |
| Net Income | -0 | -1 | -0 | -1 | | -2,274.1% | | |
Balance Sheet
|
|---|
| Cash | 0 | 0 | 0 | 0 | 1.4% | -10.9% | -66.0% | -49.4% |
| Short Term Debt | 2 | 3 | 2 | 1 | 3.6% | -36.7% | -42.4% | -51.2% |
| Long Term Debt | 3 | 2 | 2 | 2 | -10.3% | -36.0% | -38.9% | -31.3% |
Ratios
|
|---|
| Gross Margin | 24.3% | 25.5% | 27.4% | 28.1% | 4.7% | 3.1% | 4.1% | 11.5% |
| Net Income Margin | -16.7% | -21.0% | -4.3% | -20.7% | -9.0% | -21.4% | 7.3% | 63.1% |
Revenue and profitability
New West Energy Services Inc's Revenue dropped on 44.6%. Annual revenue decline showed slowdown in FY16Q4 - revenue dropped on 11.2%. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased slightly on 1.4 pp from -0.14% to -1.6% in FY2016.
Gross Margin increased on 5.2 pp from 21.1% to 26.4% in FY2016. SG&A as a % of Revenue increased on 6.6 pp from 21.3% to 27.9% in FY2016.
Net Income marign increased on 2.6 pp from -17.3% to -14.7% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 New West Energy Services Inc had CAPEX/Revenue of 1.7%. New West Energy Services Inc's CAPEX/Revenue decreased on 9.4 pp from 11.1% in FY2013 to 1.7% in FY2016. It's average level of CAPEX/Revenue for the last three years was 3.5%.
Return on investment
The company operates at negative ROIC (-14.70%) and ROE (-31.69%). ROIC decreased on 4.5 pp from -10.2% to -14.7% in FY2016. ROE jumped on 15.1 pp from -46.8% to -31.7% in FY2016.
Leverage (Debt)
Debt level is -0.3x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA didn't change in FY2016. Debt dropped on 40.8% while cash dropped on 49.4%.
Appendix 1: Peers in Energy
Below you can find New West Energy Services Inc benchmarking vs. other companies in Energy 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 |
|---|
| Oryx Petroleum Corp Ltd ($OXC) | | | | -18.4% | 141.2% |
| Seven Generations Energy Ltd ($VII) | | 115.7% | 340.2% | 39.0% | 94.4% |
| Athabasca Oil Corp ($ATH) | | 342.7% | 5.5% | -22.9% | 73.1% |
| Painted Pony Petroleum Ltd ($PPY) | | 41.3% | 56.0% | -42.5% | 60.7% |
| ONEnergy Inc ($OEG) | | | 6,002.6% | 231.5% | 57.4% |
| |
|---|
| Median (117 companies) | | 15.4% | 17.0% | -28.6% | -19.0% |
|---|
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Americas Petrogas Inc ($BOE) | 77.1% | 43.3% | -34.3% | 121.1% | |
| TransAlta Renewables Inc ($RNW) | | 94.4% | 94.5% | 94.5% | 91.1% |
| Serinus Energy Inc ($SEN) | 80.5% | 76.5% | 86.8% | 88.5% | |
| Advantage Oil & Gas Ltd ($AAV) | 62.0% | 84.5% | 92.5% | 88.5% | 90.3% |
| Polaris Infrastructure Inc ($PIF) | 39.9% | 33.6% | 32.0% | 86.7% | 88.6% |
| |
|---|
| Median (115 companies) | 32.0% | 32.1% | 32.4% | 33.6% | 32.0% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Granite Oil Corp ($GXO) | 59.4% | 64.5% | 70.8% | 201.9% | |
| Perpetual Energy Inc ($PMT) | 35.5% | 70.7% | 58.0% | 110.3% | |
| Petro Rio SA ($PRJ) | -4,809.7% | -6,899.7% | 28.2% | 90.7% | |
| Peyto Exploration & Development Corp ($PEY) | 86.1% | 83.2% | 86.3% | 84.6% | 80.7% |
| Innergex Renewable Energy Inc ($INE) | 111.8% | 110.0% | 82.9% | 83.4% | 83.5% |
| |
|---|
| Median (129 companies) | 25.7% | 34.5% | 28.9% | 8.4% | 28.2% |
|---|
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Oryx Petroleum Corp Ltd ($OXC) | | | 1,997.8% | 712.8% | |
| WesternZagros Resources Ltd ($WZR) | | | | 385.6% | |
| Athabasca Oil Corp ($ATH) | 2,426.4% | 596.6% | 504.7% | 315.2% | 83.7% |
| TORC Oil & Gas Ltd ($TOG) | 453.8% | 466.9% | 104.5% | 229.4% | 76.3% |
| Seven Generations Energy Ltd ($VII) | 452.8% | 513.1% | 227.4% | 191.2% | 73.5% |
| |
|---|
| Median (130 companies) | 42.5% | 39.1% | 45.3% | 27.8% | 23.0% |
|---|
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Enerplus Corp ($ERF) | -17.3% | 10.2% | 11.5% | -55.5% | 16.3% |
| Whitecap Resources Inc ($WCP) | 7.1% | 8.1% | 9.6% | -10.6% | 10.1% |
| Ecopetrol SA ($ECP) | 29.3% | 24.4% | 16.5% | 3.0% | 9.6% |
| Parkland Fuel Corp ($PKI) | 22.3% | 23.3% | 9.9% | 7.8% | 8.6% |
| Inter Pipeline Ltd ($IPL) | 9.5% | 8.0% | 7.5% | 9.6% | 8.5% |
| |
|---|
| Median (129 companies) | 3.8% | 5.6% | 5.5% | -8.4% | -1.9% |
|---|
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| BlackPearl Resources Inc ($PXX) | -0.2x | -0.1x | 0.2x | 3,726.1x | -0.2x |
| Paramount Resources Ltd ($POU) | 14.6x | 23.9x | 8.9x | 421.5x | -5.8x |
| Precision Drilling Corp ($PD) | 2.2x | 1.9x | 2.0x | 68.4x | 7.6x |
| Trican Well Service Ltd ($TCW) | 2.5x | 3.4x | 2.9x | 31.4x | |
| Trilogy Energy Corp ($TET) | 2.6x | 1.8x | 2.3x | 25.5x | 7.3x |
| |
|---|
| Median (79 companies) | 1.6x | 1.4x | 1.4x | 2.6x | 2.7x |
|---|
