Centamin Net Income jumped on 316% in 2016 and Revenue jumped on 35.2%
01.02.2017 • About Centamin (
$CEE) • By InTwits
Centamin reported 2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Centamin is a fast growth stock: 2016 revenue growth was 35.2%, 5 year revenue CAGR was 15.1% at 2016 ROIC 18.1%
- Centamin has high CAPEX intensity: 5 year average CAPEX/Revenue was 32.0%. At the same time it's a lot of higher than industry average of 22.4%.
- CAPEX is quite volatile: 107 in 2016, 70.9 in 2015, 88.5 in 2014, 281 in 2013, 238 in 2012
- The company has highly profitable business model: ROIC is at 18.1%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Centamin ($CEE) key annual financial indicators
| mln. $ | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 426.1 | 503.8 | 472.6 | 508.4 | 687.4 | 35.2% |
| Gross Profit | 256.3 | 226.4 | 114.3 | 92.2 | 298.1 | 223.5% |
| SG&A | 15.0 | 11.4 | 9.1 | 0.6 | 0.2 | -67.4% |
| EBITDA | 261.6 | 226.2 | 168.3 | 154.3 | 367.9 | 138.4% |
| Net Income | 232.2 | 184.0 | 81.6 | 51.6 | 214.8 | 316.4% |
Balance Sheet
|
|---|
| Cash | 147.1 | 106.0 | 125.7 | 199.6 | 399.9 | 100.3% |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 238.1 | 281.4 | 88.5 | 70.9 | 106.7 | 50.4% |
Ratios
|
|---|
| Revenue growth | 25.2% | 18.2% | -6.2% | 7.6% | 35.2% | |
| EBITDA growth | 24.1% | -13.5% | -25.6% | -8.3% | 138.4% | |
| Gross Margin | 60.2% | 44.9% | 24.2% | 18.1% | 43.4% | 25.2% |
| EBITDA Margin | 61.4% | 44.9% | 35.6% | 30.4% | 53.5% | 23.2% |
| Net Income Margin | 54.5% | 36.5% | 17.3% | 10.1% | 31.2% | 21.1% |
| SG&A, % of revenue | 3.5% | 2.3% | 1.9% | 0.1% | 0.0% | -0.1% |
| CAPEX, % of revenue | 55.9% | 55.8% | 18.7% | 14.0% | 15.5% | 1.6% |
| ROIC | 24.6% | 15.7% | 6.6% | 4.5% | 18.1% | 13.6% |
| ROE | 25.3% | 16.5% | 6.4% | 3.8% | 14.9% | 11.1% |
| Net Debt/EBITDA | -0.6x | -0.5x | -0.7x | -1.3x | -1.1x | 0.2x |
Centamin ($CEE) key quoterly financial indicators
| mln. $ | 16Q1 | 16Q2 | 16Q3 | 16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 148 | 180 | 201 | 158 | 9.3% | 45.0% | 69.4% | 21.6% |
| EBITDA | 68 | 101 | 121 | 78 | 29.5% | 176.7% | 292.9% | 126.5% |
| Net Income | 41 | 73 | 65 | 36 | 43.0% | 285.5% | 938.5% | |
Balance Sheet
|
|---|
| Cash | 234 | 282 | 388 | 400 | 43.5% | 61.0% | 103.8% | 100.3% |
| Short Term Debt | 0 | 0 | 0 | 0 | | | | |
| Long Term Debt | 0 | 0 | 0 | 0 | | | | |
Ratios
|
|---|
| Gross Margin | 31.3% | 46.2% | 51.0% | 41.6% | 5.4% | 25.2% | 40.3% | 27.7% |
| EBITDA Margin | 46.1% | 56.1% | 60.1% | 49.1% | 7.2% | 26.7% | 34.2% | 22.7% |
| Net Income Margin | 27.6% | 40.3% | 32.3% | 23.0% | 6.5% | 25.1% | 27.1% | 24.6% |
Revenue and profitability
Centamin's Revenue jumped on 35.2%. Revenue growth showed slow down in 16Q4 - it was 21.6% YoY. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin jumped on 59.9 pp from -28.4% to 31.5% in 2016.
Gross Margin surged on 25.2 pp from 18.1% to 43.4% in 2016. SG&A as a % of Revenue showed almost no change in 2016.
Net Income marign surged on 21.1 pp from 10.1% to 31.2% in 2016.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 15.5% in 2016. CAPEX/Revenue dropped on 40.3 pp from 55.8% in 2013 to 15.5% in 2016. It's average CAPEX/Revenue for the last three years was 16.1%.
Return on investment
The company operates at good ROIC (18.09%) and ROE (14.92%). ROIC surged on 13.6 pp from 4.5% to 18.1% in 2016. ROE surged on 11.1 pp from 3.8% to 14.9% in 2016.
Leverage (Debt)
The company has no debt. Cash jumped on 100%.
Management team
The company's CEO Andrew Pardey "Andy" is a founder and has spent 3 years at the company. The company's CFO Ross Jerrard has spent 2 years at the company.
Appendix 1: Peers in Mining
Below you can find Centamin benchmarking vs. other companies in Mining 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 |
|---|
| Caledonia Mining Corp ($CAL) | | -16.0% | -15.4% | -28.3% | 61.6% |
| Serabi Gold ($SBI) | | | | 177.8% | 49.9% |
| Minera Irl Ltd ($IRL) | | -22.4% | -16.4% | -7.6% | 5.7% |
| Rambler Metals & Mining ($RAB) | | 2,744.1% | 79.2% | -34.2% | -1.3% |
| Orosur Mining Inc ($OMI) | | | -24.1% | -18.0% | -34.9% |
| |
|---|
| Median (5 companies) | | -12.5% | -15.4% | -12.8% | 5.7% |
|---|
| Centamin ($CEE) | | 18.2% | -6.2% | 7.6% | 35.2% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Caledonia Mining Corp ($CAL) | 54.4% | 45.9% | 34.7% | 26.9% | 37.9% |
| Serabi Gold ($SBI) | | | 2.3% | 32.8% | 37.4% |
| Rambler Metals & Mining ($RAB) | 44.7% | 39.6% | 52.2% | 30.6% | 28.6% |
| Minera Irl Ltd ($IRL) | 41.0% | 20.7% | 22.7% | 23.7% | 24.8% |
| Orosur Mining Inc ($OMI) | | 7.8% | 9.3% | -5.8% | 1.8% |
| |
|---|
| Median (5 companies) | 42.9% | 33.7% | 28.7% | 25.3% | 28.6% |
|---|
| Centamin ($CEE) | 60.2% | 44.9% | 24.2% | 18.1% | 43.4% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Caledonia Mining Corp ($CAL) | 31.9% | 38.9% | 27.1% | 18.3% | 37.8% |
| Serabi Gold ($SBI) | | | -12.6% | 19.1% | 27.4% |
| Minera Irl Ltd ($IRL) | 29.1% | 14.4% | 8.3% | -13.7% | 13.0% |
| Orosur Mining Inc ($OMI) | | 17.3% | 27.9% | -49.7% | -3.9% |
| Rambler Metals & Mining ($RAB) | -194.4% | 29.6% | 45.1% | 20.5% | -17.6% |
| |
|---|
| Median (5 companies) | 30.5% | 29.6% | 27.5% | 18.7% | 13.0% |
|---|
| Centamin ($CEE) | 61.4% | 44.9% | 35.6% | 30.4% | 53.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Caledonia Mining Corp ($CAL) | 10.5% | 18.0% | 11.5% | 33.8% | 32.1% |
| Minera Irl Ltd ($IRL) | 4.5% | 10.9% | 7.5% | 24.8% | 27.0% |
| Rambler Metals & Mining ($RAB) | 820.8% | 24.2% | 13.9% | 20.7% | 22.9% |
| Orosur Mining Inc ($OMI) | | 29.6% | 14.1% | 19.7% | 15.1% |
| Serabi Gold ($SBI) | | | 44.5% | 8.5% | 6.8% |
| |
|---|
| Median (5 companies) | 37.6% | 24.2% | 14.0% | 22.8% | 22.9% |
|---|
| Centamin ($CEE) | 55.9% | 55.8% | 18.7% | 14.0% | 15.5% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Caledonia Mining Corp ($CAL) | 37.6% | 34.9% | 18.1% | 8.4% | 32.0% |
| Serabi Gold ($SBI) | -9.1% | -8.9% | -5.8% | 1.2% | 9.9% |
| Minera Irl Ltd ($IRL) | 6.0% | -0.4% | -0.0% | -4.3% | 0.4% |
| Rambler Metals & Mining ($RAB) | -2.6% | 3.3% | 16.7% | 0.5% | -17.1% |
| Orosur Mining Inc ($OMI) | | -1.5% | 4.5% | -84.1% | -23.6% |
| |
|---|
| Median (6 companies) | 5.9% | 1.5% | 3.8% | 0.8% | 0.4% |
|---|
| Centamin ($CEE) | 24.6% | 15.7% | 6.6% | 4.5% | 18.1% |
Top companies by Net Debt / EBITDA
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Minera Irl Ltd ($IRL) | 1.0x | 4.2x | 10.0x | | 16.4x |
| Serabi Gold ($SBI) | | | | 1.4x | -0.1x |
| Caledonia Mining Corp ($CAL) | -1.2x | -0.9x | -1.6x | -1.1x | -0.5x |
| |
|---|
| Median (3 companies) | 0.2x | 2.5x | 0.6x | 1.9x | -0.1x |
|---|
| Centamin ($CEE) | -0.6x | -0.5x | -0.7x | -1.3x | -1.1x |
