Dundee Energy Ltd EBITDA dropped on 403% in 2016 and EBITDA Margin dropped on 62.8 pp from 13.2% to -49.5%
16.02.2017 • About Dundee Energy Ltd (
$DEN) • By InTwits
Dundee Energy Ltd reported 2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Dundee Energy Ltd is a company in decline: 2016 revenue growth was -19.0%, 5 years revenue CAGR was -10.7%
- The company operates at negative EBITDA Margin: -49.5%
- EBITDA Margin is quite volatile: -49.5% in 2016, 13.2% in 2015, 43.7% in 2014, 24.9% in 2013, -10.0% in 2012
- Dundee Energy Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 21.7%. At the same time it's a lot of higher than industry average of 3.1%.
- CAPEX is quite volatile: 0.69 in 2016, 0.57 in 2015, 7.4 in 2014, 12.9 in 2013, 13.7 in 2012
- The company has unprofitable business model: ROIC is at -22.4%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Dundee Energy Ltd ($DEN) key annual financial indicators
| mln. CAD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 30.483 | 33.208 | 39.280 | 25.086 | 20.310 | -19.0% |
| Gross Profit | 1.997 | 5.656 | 12.450 | 9.333 | 7.925 | -15.1% |
| SG&A | | | | 5.112 | 5.322 | 4.1% |
| EBITDA | -3.055 | 8.261 | 17.165 | 3.321 | -10.056 | -402.8% |
| Net Income | -16.623 | -6.184 | 1.348 | -8.281 | -19.121 | |
Balance Sheet
|
|---|
| Cash | 0.125 | 0.111 | 0.829 | 0.086 | 1.505 | 1,650.0% |
| Short Term Debt | 62.633 | 65.709 | 61.617 | 58.802 | 57.400 | -2.4% |
| Long Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
Cash flow
|
|---|
| Capex | 13.710 | 12.948 | 7.362 | 0.574 | 0.686 | 19.5% |
Ratios
|
|---|
| Revenue growth | -14.9% | 8.9% | 18.3% | -36.1% | -19.0% | |
| EBITDA growth | -117.8% | -370.4% | 107.8% | -80.7% | -402.8% | |
| Gross Margin | 6.6% | 17.0% | 31.7% | 37.2% | 39.0% | 1.8% |
| EBITDA Margin | -10.0% | 24.9% | 43.7% | 13.2% | -49.5% | -62.8% |
| Net Income Margin | -54.5% | -18.6% | 3.4% | -33.0% | -94.1% | -61.1% |
| SG&A, % of revenue | | | | 20.4% | 26.2% | 5.8% |
| CAPEX, % of revenue | 45.0% | 39.0% | 18.7% | 2.3% | 3.4% | 1.1% |
| ROIC | -15.1% | -3.8% | 5.5% | -8.0% | -22.4% | -14.4% |
| ROE | -25.7% | -10.7% | 2.3% | -14.8% | -45.5% | -30.6% |
| Net Debt/EBITDA | | 7.9x | 3.5x | 17.7x | | -17.7x |
Dundee Energy Ltd ($DEN) key quoterly financial indicators
| mln. CAD | 16Q1 | 16Q2 | 16Q3 | 16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 4 | 5 | 5 | 6 | -38.0% | -31.8% | -14.9% | 19.3% |
| EBITDA | -0 | -5 | 1 | -5 | -100.7% | -515.6% | -32.0% | |
| Net Income | -3 | -7 | -2 | -7 | | | | |
Balance Sheet
|
|---|
| Cash | 0 | 0 | 0 | 2 | 151.8% | -38.2% | -97.3% | 1,650.0% |
| Short Term Debt | 59 | 59 | 57 | 57 | -2.7% | -1.3% | -3.7% | -2.4% |
| Long Term Debt | 0 | 0 | 0 | 0 | | | | |
Ratios
|
|---|
| Gross Margin | 36.0% | 16.0% | 39.8% | 58.7% | -13.0% | -18.9% | 8.2% | 27.2% |
| EBITDA Margin | -0.4% | -115.0% | 13.3% | -90.4% | -32.8% | -133.9% | -3.4% | -65.1% |
| Net Income Margin | -69.5% | -155.4% | -38.7% | -114.0% | -51.9% | -133.1% | -9.0% | -41.0% |
Revenue and profitability
The company's Revenue dropped on 19.0%. Annual revenue decline showed slowdown in 16Q4 - revenue jumped on 19.3%. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin dropped on 62.8 pp from 13.2% to -49.5% in 2016.
Gross Margin increased slightly on 1.8 pp from 37.2% to 39.0% in 2016. SG&A as a % of Revenue increased on 5.8 pp from 20.4% to 26.2% in 2016.
Net Income marign dropped on 61.1 pp from -33.0% to -94.1% in 2016.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 3.4% in 2016. The company showed big decline in CAPEX/Revenue of 35.6 pp from 39.0% in 2013 to 3.4% in 2016. Average CAPEX/Revenue for the last three years was 8.1%.
Return on investment
The company operates at negative ROIC (-22.41%) and ROE (-45.46%). ROIC dropped on 14.4 pp from -8.0% to -22.4% in 2016. ROE dropped on 30.6 pp from -14.8% to -45.5% in 2016.
Leverage (Debt)
Debt level is 3.3x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA dropped on 17.7x from 17.7x to in 2016. Debt decreased on 2.4% while cash surged on 1,650%.
Appendix 1: Peers in Energy
Below we provide Dundee Energy Ltd benchmarking against other companies in Energy 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 |
|---|
| Oryx Petroleum Corp Ltd ($OXC) | | | | -18.4% | 141.2% |
| Seven Generations Energy Ltd ($VII) | | 115.7% | 340.2% | 39.0% | 94.4% |
| Athabasca Oil Corp ($ATH) | | 342.7% | 5.5% | -22.9% | 73.1% |
| Painted Pony Petroleum Ltd ($PPY) | | 41.3% | 56.0% | -42.5% | 60.7% |
| ONEnergy Inc ($OEG) | | | 6,002.6% | 231.5% | 57.4% |
| |
|---|
| Median (116 companies) | | 16.2% | 16.9% | -27.7% | -18.1% |
|---|
| Dundee Energy Ltd ($DEN) | | 8.9% | 18.3% | -36.1% | -19.0% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Americas Petrogas Inc ($BOE) | 77.1% | 43.3% | -34.3% | 121.1% | |
| TransAlta Renewables Inc ($RNW) | | 94.4% | 94.5% | 94.5% | 91.1% |
| Serinus Energy Inc ($SEN) | 80.5% | 76.5% | 86.8% | 88.5% | |
| Advantage Oil & Gas Ltd ($AAV) | 62.0% | 84.5% | 92.5% | 88.5% | 90.3% |
| Polaris Infrastructure Inc ($PIF) | 39.9% | 33.6% | 32.0% | 86.7% | 88.6% |
| |
|---|
| Median (114 companies) | 32.0% | 32.2% | 32.4% | 33.6% | 31.5% |
|---|
| Dundee Energy Ltd ($DEN) | 6.6% | 17.0% | 31.7% | 37.2% | 39.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Granite Oil Corp ($GXO) | 59.4% | 64.5% | 70.8% | 201.9% | |
| Perpetual Energy Inc ($PMT) | 35.5% | 70.7% | 58.0% | 110.3% | |
| Petro Rio SA ($PRJ) | -4,809.7% | -6,899.7% | 28.2% | 90.7% | |
| Peyto Exploration & Development Corp ($PEY) | 86.1% | 83.2% | 86.3% | 84.6% | 80.7% |
| Innergex Renewable Energy Inc ($INE) | 111.8% | 110.0% | 82.9% | 83.4% | 83.5% |
| |
|---|
| Median (128 companies) | 25.9% | 35.7% | 28.9% | 8.1% | 29.2% |
|---|
| Dundee Energy Ltd ($DEN) | -10.0% | 24.9% | 43.7% | 13.2% | -49.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Oryx Petroleum Corp Ltd ($OXC) | | | 1,997.8% | 712.8% | |
| WesternZagros Resources Ltd ($WZR) | | | | 385.6% | |
| Athabasca Oil Corp ($ATH) | 2,426.4% | 596.6% | 504.7% | 315.2% | 83.7% |
| TORC Oil & Gas Ltd ($TOG) | 453.8% | 466.9% | 104.5% | 229.4% | 76.3% |
| Seven Generations Energy Ltd ($VII) | 452.8% | 513.1% | 227.4% | 191.2% | 73.5% |
| |
|---|
| Median (129 companies) | 42.3% | 39.2% | 45.6% | 28.1% | 23.8% |
|---|
| Dundee Energy Ltd ($DEN) | 45.0% | 39.0% | 18.7% | 2.3% | 3.4% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Enerplus Corp ($ERF) | -17.3% | 10.2% | 11.5% | -55.5% | 16.3% |
| Whitecap Resources Inc ($WCP) | 7.1% | 8.1% | 9.6% | -10.6% | 10.1% |
| Ecopetrol SA ($ECP) | 29.3% | 24.4% | 16.5% | 3.0% | 9.6% |
| Parkland Fuel Corp ($PKI) | 22.3% | 23.3% | 9.9% | 7.8% | 8.6% |
| Inter Pipeline Ltd ($IPL) | 9.5% | 8.0% | 7.5% | 9.6% | 8.5% |
| |
|---|
| Median (128 companies) | 3.9% | 5.8% | 5.7% | -8.5% | -1.9% |
|---|
| Dundee Energy Ltd ($DEN) | -15.1% | -3.8% | 5.5% | -8.0% | -22.4% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| BlackPearl Resources Inc ($PXX) | -0.2x | -0.1x | 0.2x | 3,726.1x | -0.2x |
| Paramount Resources Ltd ($POU) | 14.6x | 23.9x | 8.9x | 421.5x | -5.8x |
| Precision Drilling Corp ($PD) | 2.2x | 1.9x | 2.0x | 68.4x | 7.6x |
| Trican Well Service Ltd ($TCW) | 2.5x | 3.4x | 2.9x | 31.4x | |
| Trilogy Energy Corp ($TET) | 2.6x | 1.8x | 2.3x | 25.5x | 7.3x |
| |
|---|
| Median (78 companies) | 1.6x | 1.4x | 1.4x | 2.6x | 2.7x |
|---|
| Dundee Energy Ltd ($DEN) | | 7.9x | 3.5x | 17.7x | |
