Pacific Safety Products Inc reports 108% Net Income growth and 13.7% Revenue growth
28.09.2016 • About Pacific Safety Products Inc (
$PSP) • By InTwits
Pacific Safety Products Inc reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Pacific Safety Products Inc has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.5%.
- The company has highly profitable business model: ROIC is at 12.3%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Pacific Safety Products Inc ($PSP) key annual financial indicators
| mln. CAD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 16.734 | 11.697 | 14.342 | 17.729 | 20.149 | 13.7% |
| Gross Profit | 4.824 | 2.903 | 3.791 | 5.129 | 4.966 | -3.2% |
| SG&A | 4.437 | 2.628 | 3.245 | 2.965 | 3.660 | 23.4% |
| Net Income | -1.236 | -0.667 | -0.173 | 1.017 | 2.117 | 108.1% |
Balance Sheet
|
|---|
| Cash | 1.708 | 1.334 | 1.334 | 0.128 | 0.600 | 367.9% |
| Short Term Debt | 0.835 | 0.367 | 0.868 | 0.356 | 0.000 | -100.0% |
| Long Term Debt | 1.480 | 0.411 | 0.196 | 0.693 | 0.712 | 2.6% |
Cash flow
|
|---|
| Capex | 0.064 | 0.044 | 0.084 | 0.092 | 0.115 | 24.5% |
Ratios
|
|---|
| Revenue growth | -26.2% | -30.1% | 22.6% | 23.6% | 13.7% | |
| Gross Margin | 28.8% | 24.8% | 26.4% | 28.9% | 24.6% | -4.3% |
| Net Income Margin | -7.4% | -5.7% | -1.2% | 5.7% | 10.5% | 4.8% |
| SG&A, % of revenue | 26.5% | 22.5% | 22.6% | 16.7% | 18.2% | 1.4% |
| CAPEX, % of revenue | 0.4% | 0.4% | 0.6% | 0.5% | 0.6% | 0.0% |
| ROIC | -1.5% | -11.5% | 3.7% | 38.2% | 12.3% | -25.8% |
| ROE | -49.3% | -36.9% | -10.1% | 41.1% | 51.2% | 10.0% |
Pacific Safety Products Inc ($PSP) key quoterly financial indicators
| mln. CAD | FY16Q1 | FY16Q2 | FY16Q3 | FY16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 5 | 4 | 5 | 6 | 32.9% | 25.7% | 4.6% | 1.0% |
| Net Income | 0 | 0 | 0 | 2 | 636.3% | | -94.5% | 85.7% |
Balance Sheet
|
|---|
| Cash | 0 | 1 | 0 | 1 | -91.9% | 480.3% | 43.3% | 367.9% |
| Short Term Debt | 0 | 0 | 0 | 0 | -86.1% | 5.3% | -95.5% | -100.0% |
| Long Term Debt | 1 | 1 | 1 | 1 | 388.5% | 687.7% | -2.1% | 2.6% |
Ratios
|
|---|
| Gross Margin | 24.3% | 21.3% | 25.2% | 27.1% | -4.3% | -6.2% | -2.2% | -4.4% |
| Net Income Margin | 5.6% | 0.1% | 0.1% | 33.1% | 4.6% | 2.5% | -1.5% | 15.1% |
Revenue and profitability
Pacific Safety Products Inc's Revenue jumped on 13.7%. Revenue growth showed slow down in FY16Q4 - it was 1.0% YoY.
Gross Margin decreased on 4.3 pp from 28.9% to 24.6% in FY2016. SG&A as a % of Revenue increased slightly on 1.4 pp from 16.7% to 18.2% in FY2016.
Net Income marign increased on 4.8 pp from 5.7% to 10.5% in FY2016.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 0.57% in FY2016. CAPEX/Revenue showed almost no change from FY2013 to FY2016. Average CAPEX/Revenue for the last three years was 0.56%.
Return on investment
The company operates at high and attractive ROE (51.17%) while ROIC is a bit lower (12.35%). ROIC dropped on 25.8 pp from 38.2% to 12.3% in FY2016. ROE surged on 10.0 pp from 41.1% to 51.2% in FY2016.
Leverage (Debt)
Debt dropped on 32.2% while cash jumped on 368%.
Appendix 1: Peers in Industrial
Below we provide Pacific Safety Products Inc benchmarking against other companies in Industrial industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Progressive Waste Solutions Ltd ($BIN) | | 16.1% | 7.8% | 1.8% | 59.4% |
| Baylin Technologies Inc ($BYL) | | 16.5% | -44.0% | -4.1% | 47.5% |
| CCL Industries Inc ($CCL.B) | | 44.4% | 36.8% | 17.5% | 30.8% |
| Stantec Inc ($STN) | | 17.9% | 13.3% | 14.4% | 30.5% |
| Avigilon Corp ($AVO) | | 72.6% | 41.9% | 17.7% | 22.2% |
| |
|---|
| Median (52 companies) | | 5.1% | 10.1% | 8.1% | 2.9% |
|---|
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Pure Technologies Ltd ($PUR) | 77.9% | 78.0% | 77.5% | 75.6% | |
| WSP Global Inc ($WSP) | 81.1% | 83.2% | 81.0% | 74.0% | 76.7% |
| Avigilon Corp ($AVO) | 49.3% | 54.2% | 56.6% | 57.4% | 52.0% |
| Stantec Inc ($STN) | 55.0% | 54.7% | 54.9% | 54.5% | 54.1% |
| IWG Technologies Inc ($IWG) | 53.3% | 54.0% | 49.0% | 47.8% | 54.9% |
| |
|---|
| Median (50 companies) | 23.6% | 23.4% | 21.7% | 21.7% | 22.2% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Canadian National Railway Co ($CNR) | 46.5% | 45.9% | 46.8% | 50.9% | 54.3% |
| Canadian Pacific Railway Ltd ($CP) | 26.1% | 32.4% | 43.7% | 48.9% | 51.6% |
| Badger Daylighting Ltd ($BAD) | 25.7% | 25.9% | 27.9% | 24.6% | 24.2% |
| IWG Technologies Inc ($IWG) | 12.7% | 25.5% | 20.0% | 24.0% | 26.9% |
| Winpak Ltd ($WPK) | 19.5% | 18.6% | 18.7% | 22.7% | 23.5% |
| |
|---|
| Median (54 companies) | 10.4% | 8.4% | 8.4% | 8.6% | 11.1% |
|---|
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Newalta Corp ($NAL) | 21.7% | 34.5% | 35.1% | 42.0% | 9.6% |
| Cargojet Inc ($CJT.A) | 7.0% | 6.3% | 54.1% | 41.3% | |
| Algoma Central Corp ($ALC) | 15.9% | 7.3% | 5.0% | 27.4% | 58.2% |
| Canadian Pacific Railway Ltd ($CP) | 20.2% | 20.2% | 21.9% | 22.7% | 19.0% |
| Canadian National Railway Co ($CNR) | 17.4% | 18.7% | 18.9% | 21.5% | 22.4% |
| |
|---|
| Median (55 companies) | 3.2% | 3.7% | 4.3% | 3.9% | 4.3% |
|---|
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| IBI Group Inc ($IBG) | 4.8% | -9.0% | 11.6% | 21.9% | 26.2% |
| IWG Technologies Inc ($IWG) | 17.0% | 36.3% | 23.4% | 27.2% | 25.7% |
| Winpak Ltd ($WPK) | 20.4% | 18.0% | 18.3% | 22.6% | 21.8% |
| Toromont Industries Ltd ($TIH) | 28.8% | 25.8% | 24.3% | 23.5% | 21.7% |
| Intertape Polymer Group Inc ($ITP) | 12.3% | 13.7% | 22.5% | 23.0% | 21.0% |
| |
|---|
| Median (56 companies) | 12.2% | 9.6% | 11.5% | 8.3% | 9.0% |
|---|
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Conifex Timber Inc ($CFF) | | 2.7x | 6.1x | 35.9x | 3.6x |
| Ag Growth International Inc ($AFN) | 2.9x | -0.1x | 2.1x | 14.1x | |
| Cargojet Inc ($CJT.A) | 1.5x | 1.5x | 31.5x | 12.9x | |
| Progressive Waste Solutions Ltd ($BIN) | 4.5x | 3.3x | 2.9x | 10.6x | 3.8x |
| Finning International Inc ($FTT) | 2.3x | 1.8x | 1.4x | 9.4x | 2.5x |
| |
|---|
| Median (50 companies) | 1.5x | 1.6x | 1.3x | 1.0x | 1.9x |
|---|
