Cerro Grande Mining Corp revenue decline decelerated from 36.0% in FY2015 to 34.6% in FY2016
30.01.2017 • About Cerro Grande Mining Corp (
$CEG) • By InTwits
Cerro Grande Mining Corp reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Cerro Grande Mining Corp is a company in decline: FY2016 revenue growth was -34.6%, 5 years revenue CAGR was -24.7%
- The company operates at negative EBITDA Margin: -72.8%
- Cerro Grande Mining Corp spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for FY2012-FY2016 is 0.0%. Average EBITDA Margin for the same period was -22.3%0
- Cerro Grande Mining Corp has medium CAPEX intensity: 5 year average CAPEX/Revenue was 8.7%. At the same time it's a lot of higher than industry average of 7.1%.
- CAPEX is quite volatile: 0 in FY2016, 1.2 in FY2015, 0.40 in FY2014, 3.2 in FY2013, 2.8 in FY2012
- It operates with high leverage: Net Debt/EBITDA is 4.3x while industry average is 0.8x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Cerro Grande Mining Corp ($CEG) key annual financial indicators
| mln. $ | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 27.445 | 18.778 | 14.064 | 8.995 | 5.887 | -34.6% |
| SG&A | | | | 2.765 | 1.871 | -32.3% |
| EBITDA | 0.015 | 0.105 | -2.451 | -10.179 | -4.285 | |
| Net Income | -3.712 | -6.220 | -5.147 | -12.905 | -6.936 | |
Balance Sheet
|
|---|
| Cash | 1.336 | 0.053 | 0.087 | 0.252 | 0.118 | -53.2% |
| Short Term Debt | 0.538 | 0.813 | 0.732 | 0.209 | 0.156 | -25.4% |
| Long Term Debt | 1.019 | 1.879 | 0.855 | 0.637 | 0.740 | 16.2% |
Cash flow
|
|---|
| Capex | 2.781 | 3.161 | 0.397 | 1.236 | 0.000 | -100.0% |
Ratios
|
|---|
| Revenue growth | 13.0% | -31.6% | -25.1% | -36.0% | -34.6% | |
| EBITDA growth | -99.7% | 600.0% | -2,434.3% | 315.3% | -57.9% | |
| EBITDA Margin | 0.1% | 0.6% | -17.4% | -113.2% | -72.8% | 40.4% |
| Net Income Margin | -13.5% | -33.1% | -36.6% | -143.5% | -117.8% | 25.6% |
| SG&A, % of revenue | | | | 30.7% | 31.8% | 1.0% |
| CAPEX, % of revenue | 10.1% | 16.8% | 2.8% | 13.7% | 0.0% | -13.7% |
| ROIC | -11.1% | -25.5% | -38.6% | -250.0% | | 250.0% |
| ROE | -19.6% | -40.4% | -46.1% | | | 0.0% |
| Net Debt/EBITDA | 14.7x | 25.1x | | | | 0.0x |
Cerro Grande Mining Corp ($CEG) key quoterly financial indicators
| mln. $ | FY16Q1 | FY16Q2 | FY16Q3 | FY16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 3 | 2 | 1 | 0 | 7.4% | -28.3% | -29.4% | -96.9% |
| EBITDA | -0 | -1 | -1 | -2 | | | | |
| Net Income | -1 | -1 | -2 | -3 | | | | |
Balance Sheet
|
|---|
| Cash | 0 | 0 | 0 | 0 | -39.2% | 2.2% | -40.3% | -53.2% |
| Short Term Debt | 0 | 0 | 0 | 0 | -83.1% | -90.0% | -83.1% | -25.4% |
| Long Term Debt | 1 | 1 | 1 | 1 | -14.8% | 3.2% | -6.4% | 16.2% |
Ratios
|
|---|
| EBITDA Margin | -13.4% | -42.8% | -77.7% | -3,311.3% | 19.4% | -10.5% | -38.6% | -2,947.9% |
| Net Income Margin | -39.3% | -76.6% | -110.7% | -4,767.7% | 18.1% | -19.0% | -42.2% | -4,339.2% |
Revenue and profitability
The company's Revenue dropped on 34.6%. Revenue decline showed acceleration in FY16Q4 - it was 96.9% YoY. Revenue decline happened at the same time with EBITDA margin expansion. EBITDA Margin surged on 40.4 pp from -113% to -72.8% in FY2016.
SG&A as a % of Revenue increased slightly on 1.0 pp from 30.7% to 31.8% in FY2016.
Net Income marign surged on 25.6 pp from -143% to -118% in FY2016.
Leverage (Debt)
Debt level is 4.3x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA didn't change in FY2016. Debt increased on 5.9% while cash dropped on 53.2%.
Appendix 1: Peers in Basic Materials
Below you can find Cerro Grande Mining Corp benchmarking vs. other companies in Basic Materials 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 |
|---|
| 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 |
|---|
