Conifex Timber Inc reports 643% EBITDA growth and 7.5 pp EBITDA Margin growth from 1.4% to 8.9%
15.02.2017 • About Conifex Timber Inc (
$CFF) • By InTwits
Conifex Timber Inc reported 2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is quite volatile: 8.9% in 2016, 1.4% in 2015, 5.7% in 2014, 8.3% in 2013, -2.5% in 2012
- Conifex Timber Inc has high CAPEX intensity: 5 year average CAPEX/Revenue was 12.6%. At the same time it's a lot of higher than industry average of 7.1%.
- CAPEX is quite volatile: 17.6 in 2016, 24.6 in 2015, 72.7 in 2014, 47.0 in 2013, 28.8 in 2012
- The company has potentially unprofitable business model: ROIC is at 5.9%
- It operates with high leverage: Net Debt/EBITDA is 3.6x while industry average is 2.2x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Conifex Timber Inc ($CFF) key annual financial indicators
| mln. CAD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 217.6 | 259.6 | 352.9 | 353.5 | 409.3 | 15.8% |
| Gross Profit | 2.5 | 25.6 | 24.4 | 6.2 | 35.7 | 473.8% |
| SG&A | | 12.2 | 15.1 | 15.6 | 17.5 | 12.2% |
| EBITDA | -5.4 | 21.5 | 20.1 | 4.9 | 36.3 | 642.5% |
| Net Income | -16.2 | 9.5 | 4.6 | -17.3 | 70.2 | |
Balance Sheet
|
|---|
| Cash | 12.1 | 17.4 | 10.1 | 9.9 | 12.7 | 27.7% |
| Short Term Debt | 5.9 | 14.9 | 22.5 | 49.2 | 48.4 | -1.6% |
| Long Term Debt | 20.4 | 60.0 | 110.9 | 136.3 | 95.4 | -30.0% |
Cash flow
|
|---|
| Capex | 28.8 | 47.0 | 72.7 | 24.6 | 17.6 | -28.3% |
Ratios
|
|---|
| Revenue growth | 74.4% | 19.3% | 35.9% | 0.2% | 15.8% | |
| EBITDA growth | -53.8% | -500.6% | -6.4% | -75.7% | 642.5% | |
| Gross Margin | 1.1% | 9.9% | 6.9% | 1.8% | 8.7% | 7.0% |
| EBITDA Margin | -2.5% | 8.3% | 5.7% | 1.4% | 8.9% | 7.5% |
| Net Income Margin | -7.4% | 3.7% | 1.3% | -4.9% | 17.2% | 22.1% |
| SG&A, % of revenue | | 4.7% | 4.3% | 4.4% | 4.3% | -0.1% |
| CAPEX, % of revenue | 13.3% | 18.1% | 20.6% | 7.0% | 4.3% | -2.6% |
| ROIC | -10.8% | 8.3% | 4.2% | -4.2% | 5.9% | 10.2% |
| ROE | -18.7% | 9.2% | 4.0% | -15.2% | 49.5% | 64.6% |
| Net Debt/EBITDA | | 2.7x | 6.1x | 35.9x | 3.6x | -32.3x |
Conifex Timber Inc ($CFF) key quoterly financial indicators
| mln. CAD | 16Q1 | 16Q2 | 16Q3 | 16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 100 | 104 | 104 | 102 | 16.7% | 26.7% | 21.2% | 1.5% |
| EBITDA | 8 | 9 | 8 | 11 | 100.9% | | 10,845.2% | 72.1% |
| Net Income | 28 | 35 | 1 | 5 | 1,673.0% | | | |
Balance Sheet
|
|---|
| Cash | 7 | 23 | 14 | 13 | -27.3% | 121.5% | 131.9% | 27.7% |
| Short Term Debt | 54 | 37 | 40 | 48 | 81.3% | 35.6% | 56.8% | -1.6% |
| Long Term Debt | 106 | 101 | 101 | 95 | -9.8% | -16.5% | -37.0% | -30.0% |
Ratios
|
|---|
| Gross Margin | 6.8% | 9.8% | 7.6% | 10.6% | 1.1% | 16.1% | 6.7% | 4.9% |
| EBITDA Margin | 7.9% | 8.7% | 7.8% | 11.1% | 3.3% | 15.6% | 7.8% | 4.5% |
| Net Income Margin | 28.6% | 34.0% | 1.4% | 5.0% | 26.7% | 49.9% | 7.8% | 5.3% |
Revenue and profitability
The company's Revenue surged on 15.8%. Revenue growth showed slow down in 16Q4 - it was 1.5% YoY. Revenue growth happened at the same time with EBITDA margin expansion. EBITDA Margin increased on 7.5 pp from 1.4% to 8.9% in 2016.
Gross Margin increased on 7.0 pp from 1.8% to 8.7% in 2016. SG&A as a % of Revenue showed almost no change in 2016.
Net Income marign jumped on 22.1 pp from -4.9% to 17.2% in 2016.
Capital expenditures (CAPEX) and working capital investments
In 2016 Conifex Timber Inc had CAPEX/Revenue of 4.3%. CAPEX/Revenue dropped on 13.8 pp from 18.1% in 2013 to 4.3% in 2016. It's average CAPEX/Revenue for the last three years was 10.6%.
Return on investment
The company operates at good ROE (49.48%) while ROIC is low (5.92%). ROIC jumped on 10.2 pp from -4.2% to 5.9% in 2016. ROE surged on 64.6 pp from -15.2% to 49.5% in 2016.
Leverage (Debt)
Company's Net Debt / EBITDA is 3.6x and Debt / EBITDA is 4.0x. Net Debt / EBITDA dropped on 32.3x from 35.9x to 3.6x in 2016. Debt dropped on 22.5% while cash surged on 27.7%.
Appendix 1: Peers in Industrial
Below you can find Conifex Timber Inc benchmarking vs. other companies in Industrial 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 |
|---|
| 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 (51 companies) | | 4.9% | 9.9% | 8.5% | 2.6% |
|---|
| Conifex Timber Inc ($CFF) | | 19.3% | 35.9% | 0.2% | 15.8% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Pure Technologies Ltd ($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 (49 companies) | 23.9% | 24.0% | 21.9% | 21.9% | 22.9% |
|---|
| Conifex Timber Inc ($CFF) | 1.1% | 9.9% | 6.9% | 1.8% | 8.7% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Canadian National Railway Co ($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 (53 companies) | 10.5% | 8.4% | 8.6% | 9.5% | 11.1% |
|---|
| Conifex Timber Inc ($CFF) | -2.5% | 8.3% | 5.7% | 1.4% | 8.9% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Newalta Corp ($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 (54 companies) | 3.2% | 3.6% | 4.3% | 3.7% | 4.5% |
|---|
| Conifex Timber Inc ($CFF) | 13.3% | 18.1% | 20.6% | 7.0% | 4.3% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| IBI Group Inc ($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 (55 companies) | 12.2% | 9.7% | 11.5% | 8.9% | 9.7% |
|---|
| Conifex Timber Inc ($CFF) | -10.8% | 8.3% | 4.2% | -4.2% | 5.9% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Ag Growth International Inc ($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 ($FTT) | 2.3x | 1.8x | 1.4x | 9.4x | 2.5x |
| ENTREC Corp ($ENT) | 3.4x | 2.6x | 4.1x | 8.4x | |
| |
|---|
| Median (49 companies) | 1.5x | 1.5x | 1.2x | 1.0x | 1.8x |
|---|
| Conifex Timber Inc ($CFF) | | 2.7x | 6.1x | 35.9x | 3.6x |
