Postmedia Network Canada Corp revenue growth accelerated from 11.3% in FY2015 to 16.9% in FY2016
20.10.2016 • About Postmedia Network Canada Corp (
$PNC.B) • By InTwits
Postmedia Network Canada Corp reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Postmedia Network Canada Corp doesn't have a profitable business model yet: FY2016 ROIC is -71.0%
- The company operates at negative EBITDA Margin: -26.0%
- EBITDA Margin is quite volatile: -26.0% in FY2016, -10.2% in FY2015, 16.2% in FY2014, 17.3% in FY2013, 17.4% in FY2012
- Postmedia Network Canada Corp has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.1%. At the same time it's in pair with industry average of 7.1%.
- CAPEX is quite volatile: 11.7 in FY2016, 4.2 in FY2015, 10.2 in FY2014, 7.6 in FY2013, 8.2 in FY2012
- The company has unprofitable business model: ROIC is at -71.0%
- It operates with high leverage: Net Debt/EBITDA is 1.5x while industry average is 0.9x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Postmedia Network Canada Corp ($PNC.B) key annual financial indicators
| mln. | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 831.9 | 751.6 | 674.3 | 750.3 | 877.2 | 16.9% |
| Gross Profit | 762.2 | | | | | |
| EBITDA | 144.6 | 129.9 | 109.5 | -76.3 | -227.9 | |
| Net Income | -23.2 | -160.2 | -107.5 | -263.4 | -352.5 | |
Balance Sheet
|
|---|
| Cash | 22.2 | 40.8 | 30.5 | 43.8 | 17.1 | -60.9% |
| Short Term Debt | 32.2 | 12.5 | 12.5 | 26.0 | 301.0 | 1,058.0% |
| Long Term Debt | 467.7 | 474.4 | 473.8 | 646.3 | 352.1 | -45.5% |
Cash flow
|
|---|
| Capex | 8.2 | 7.6 | 10.2 | 4.2 | 11.7 | 179.0% |
Ratios
|
|---|
| Revenue growth | -7.5% | -9.7% | -10.3% | 11.3% | 16.9% | |
| EBITDA growth | -24.7% | -10.1% | -15.7% | -169.6% | 198.9% | |
| Gross Margin | 91.6% | | | | | 0.0% |
| EBITDA Margin | 17.4% | 17.3% | 16.2% | -10.2% | -26.0% | -15.8% |
| Net Income Margin | -2.8% | -21.3% | -15.9% | -35.1% | -40.2% | -5.1% |
| CAPEX, % of revenue | 1.0% | 1.0% | 1.5% | 0.6% | 1.3% | 0.8% |
| ROIC | 9.2% | 8.3% | 0.7% | -27.2% | -71.0% | -43.7% |
| ROE | -8.5% | -87.1% | -148.0% | | | 0.0% |
| Net Debt/EBITDA | 3.3x | 3.4x | 4.2x | | | 0.0x |
Postmedia Network Canada Corp ($PNC.B) key quoterly financial indicators
| mln. | FY16Q1 | FY16Q2 | FY16Q3 | FY16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 251 | 209 | 218 | 199 | 48.1% | 43.8% | 6.4% | -13.7% |
| EBITDA | 31 | -185 | -8 | -66 | -22.4% | -2,372.7% | | -699.1% |
| Net Income | -4 | -225 | -24 | -99 | | | | |
Balance Sheet
|
|---|
| Cash | 32 | 26 | 21 | 17 | 60.0% | 37.0% | -59.0% | -60.9% |
| Short Term Debt | 19 | 19 | 19 | 301 | 55.7% | 55.7% | -0.0% | 1,058.0% |
| Long Term Debt | 643 | 649 | 629 | 352 | 33.0% | 26.5% | -0.7% | -45.5% |
Ratios
|
|---|
| EBITDA Margin | 12.2% | -88.7% | -3.5% | -33.0% | -11.1% | -94.3% | 62.3% | -37.8% |
| Net Income Margin | -1.7% | -107.7% | -10.8% | -50.1% | 4.4% | -67.6% | 57.8% | -26.6% |
Revenue and profitability
The company's Revenue surged on 16.9%. Revenue growth showed slow down in FY16Q4 - it was -13.7% YoY. Despite revenue decline the EBITDA margin expanded. EBITDA Margin surged on 38.7 pp from -41.2% to -2.5% in FY2016.
Net Income marign decreased on 5.1 pp from -35.1% to -40.2% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 Postmedia Network Canada Corp had CAPEX/Revenue of 1.3%. CAPEX/Revenue showed almost no change from FY2013 to FY2016. For the last three years the average CAPEX/Revenue was 1.1%.
Leverage (Debt)
Company's Net Debt / EBITDA is 1.5x and Debt / EBITDA is . Net Debt / EBITDA didn't change in FY2016. Debt decreased on 2.9% while cash dropped on 60.9%.
Appendix 1: Peers in Communications
Below we provide Postmedia Network Canada Corp benchmarking against other companies in Communications industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| AcuityAds Holding Inc ($AT) | | | | 51.6% | 91.4% |
| Shopify Inc ($SH) | | 111.9% | 109.0% | 95.4% | 89.7% |
| Gaming Nation Inc ($FAN) | | | | | 46.6% |
| Tucows Inc ($TC) | | 13.3% | 13.6% | 17.1% | 9.8% |
| Points International Ltd ($PTS) | | 45.1% | 26.0% | 16.2% | 8.6% |
| |
|---|
| Median (26 companies) | 13.1% | 3.5% | 2.1% | 4.2% | 2.3% |
|---|
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Wanted Technologies Corp ($WAN) | 90.5% | 93.2% | 94.3% | 95.6% | |
| NeuLion Inc ($NLN) | 53.6% | 63.8% | 70.2% | 81.1% | 81.6% |
| TeraGo Inc ($TGO) | 62.9% | 61.8% | 59.8% | 77.2% | 77.2% |
| ICTV Brands Inc ($ITV) | 67.4% | 71.9% | 69.6% | 68.1% | |
| Platinum Communications Corp ($PCS) | 67.4% | 67.1% | 60.2% | 60.5% | |
| |
|---|
| Median (23 companies) | 44.2% | 42.8% | 45.3% | 46.4% | 41.1% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| BCE Inc ($BCE) | 38.8% | 37.7% | 38.4% | 37.7% | 39.8% |
| Rogers Communications Inc ($RCI.A) | 37.3% | 38.4% | 37.9% | 36.9% | 32.5% |
| Quebecor Inc ($QBR.B) | 27.5% | 36.3% | 35.5% | 34.2% | 35.5% |
| TELUS Corp ($T) | 35.3% | 35.2% | 35.1% | 34.1% | 33.0% |
| ZoomerMedia Ltd ($ZUM) | 32.6% | 33.8% | 29.3% | 29.1% | 27.1% |
| |
|---|
| Median (30 companies) | 17.0% | 10.7% | 9.9% | 9.9% | 7.7% |
|---|
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| TELUS Corp ($T) | 17.9% | 17.8% | 19.8% | 20.2% | 21.5% |
| Rogers Communications Inc ($RCI.A) | 17.2% | 17.6% | 18.4% | 18.2% | 17.2% |
| Quebecor Inc ($QBR.B) | 16.7% | 15.4% | 17.9% | 17.5% | 17.6% |
| BCE Inc ($BCE) | 17.6% | 17.5% | 17.7% | 16.9% | 17.4% |
| TeraGo Inc ($TGO) | 20.9% | 21.5% | 23.1% | 14.8% | 13.0% |
| |
|---|
| Median (29 companies) | 2.7% | 3.0% | 2.3% | 2.3% | 3.0% |
|---|
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Tucows Inc ($TC) | 17.7% | 22.5% | 35.4% | 51.4% | 58.4% |
| BCE Inc ($BCE) | 14.1% | 12.6% | 12.6% | 12.3% | 12.6% |
| Quebecor Inc ($QBR.B) | 7.9% | 9.6% | 8.4% | 8.4% | 10.1% |
| MDC Partners Inc ($MDZ.A) | -3.1% | -6.3% | 14.2% | 13.7% | 10.1% |
| TELUS Corp ($T) | 12.4% | 13.0% | 13.0% | 11.5% | 9.6% |
| |
|---|
| Median (29 companies) | 8.9% | 7.9% | 7.3% | 2.6% | 0.1% |
|---|
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Intertain Group Ltd/The ($IT) | | | | 9.4x | |
| MDC Partners Inc ($MDZ.A) | 12.4x | 112.6x | 4.6x | 5.5x | 9.6x |
| Quebecor Inc ($QBR.B) | 3.7x | 3.9x | 4.2x | 4.8x | 4.3x |
| Rogers Communications Inc ($RCI.A) | 2.3x | 2.4x | 3.2x | 3.6x | 3.8x |
| Newfoundland Capital Corp Ltd ($NCC.B) | 1.4x | 1.3x | 3.3x | 3.2x | |
| |
|---|
| Median (21 companies) | 1.4x | 1.3x | 1.5x | 1.6x | 1.7x |
|---|
