Richmont Mines Inc Net Income surged on 83.7% in 2016 and EBITDA Margin increased on 4.1 pp from 22.3% to 26.5%
21.02.2017 • About Richmont Mines Inc (
$RIC) • By InTwits
Richmont Mines Inc reported 2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is quite volatile: 26.5% in 2016, 22.3% in 2015, 23.3% in 2014, 4.2% in 2013, 8.0% in 2012
- Richmont Mines Inc has high CAPEX intensity: 5 year average CAPEX/Revenue was 35.0%. At the same time it's a lot of higher than industry average of 24.1%.
- CAPEX is quite volatile: 63.3 in 2016, 52.1 in 2015, 23.1 in 2014, 41.9 in 2013, 37.9 in 2012
- The company has business model with low profitability: ROIC is at 7.2%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Richmont Mines Inc ($RIC) key annual financial indicators
| mln. CAD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 101.7 | 90.2 | 132.2 | 143.7 | 168.7 | 17.4% |
| Gross Profit | 27.9 | 4.4 | 20.3 | 25.4 | 44.3 | 74.3% |
| SG&A | | | | 9.8 | 12.2 | 24.9% |
| EBITDA | 8.2 | 3.8 | 30.8 | 32.1 | 44.6 | 39.1% |
| Net Income | -45.0 | -34.3 | 8.2 | 6.8 | 12.5 | 83.7% |
Balance Sheet
|
|---|
| Cash | 59.8 | 17.6 | 35.3 | 61.0 | 75.1 | 23.1% |
| Short Term Debt | 1.3 | 1.2 | 2.0 | 3.1 | 6.0 | 94.5% |
| Long Term Debt | 0.7 | 5.2 | 5.7 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 37.9 | 41.9 | 23.1 | 52.1 | 63.3 | 21.4% |
Ratios
|
|---|
| Revenue growth | -14.2% | -11.3% | 46.5% | 8.7% | 17.4% | |
| EBITDA growth | -79.9% | -53.2% | 706.5% | 4.1% | 39.1% | |
| Gross Margin | 27.4% | 4.9% | 15.4% | 17.7% | 26.2% | 8.6% |
| EBITDA Margin | 8.0% | 4.2% | 23.3% | 22.3% | 26.5% | 4.1% |
| Net Income Margin | -44.3% | -38.0% | 6.2% | 4.7% | 7.4% | 2.7% |
| SG&A, % of revenue | | | | 6.8% | 7.3% | 0.4% |
| CAPEX, % of revenue | 37.2% | 46.4% | 17.4% | 36.2% | 37.5% | 1.3% |
| ROIC | -2.0% | -10.2% | 8.3% | 5.6% | 7.2% | 1.6% |
| ROE | -35.7% | -33.5% | 8.4% | 5.2% | 7.0% | 1.8% |
| Net Debt/EBITDA | -7.1x | -2.9x | -0.9x | -1.8x | -1.5x | 0.3x |
Richmont Mines Inc ($RIC) key quoterly financial indicators
| mln. CAD | 16Q1 | 16Q2 | 16Q3 | 16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 53 | 41 | 31 | 44 | 41.5% | 0.2% | -8.4% | 38.7% |
| EBITDA | 20 | 10 | 5 | 9 | 99.6% | -2.1% | -51.5% | 583.8% |
| Net Income | 9 | 3 | 0 | 1 | 83.7% | -8.2% | -93.2% | |
Balance Sheet
|
|---|
| Cash | 61 | 96 | 79 | 75 | -13.4% | 22.6% | 3.0% | 23.1% |
| Short Term Debt | 3 | 4 | 6 | 6 | 35.9% | 55.6% | 141.3% | 94.5% |
| Long Term Debt | 0 | 0 | 0 | 0 | -100.0% | -100.0% | | |
Ratios
|
|---|
| Gross Margin | 33.0% | 26.8% | 23.3% | 19.7% | 12.1% | 10.4% | 4.6% | 5.3% |
| EBITDA Margin | 37.8% | 25.7% | 15.6% | 21.3% | 11.0% | -0.6% | -13.9% | 16.9% |
| Net Income Margin | 16.2% | 6.6% | 0.7% | 2.4% | 3.7% | -0.6% | -9.0% | 15.1% |
Revenue and profitability
The company's Revenue surged on 17.4%. Revenue growth showed acceleration in 16Q4 - it increased 38.7% YoY. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 8.0 pp from 47.9% to 39.9% in FY2016.
Gross Margin increased on 8.6 pp from 17.7% to 26.2% in 2016. SG&A as a % of Revenue showed almost no change in 2016.
Net Income marign increased on 2.7 pp from 4.7% to 7.4% in 2016.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 37.5% in 2016. CAPEX/Revenue decreased on 8.9 pp from 46.4% in 2013 to 37.5% in 2016. Average CAPEX/Revenue for the last three years was 30.4%.The company has spent a lot to CAPEX (142% of EBITDA) to fuel its growth.
Return on investment
The company operates at low ROIC (7.19%) and ROE (7.00%). ROIC increased slightly on 1.6 pp from 5.6% to 7.2% in 2016. ROE increased slightly on 1.8 pp from 5.2% to 7.0% in 2016.
Leverage (Debt)
Company's Net Debt / EBITDA is -1.5x and Debt / EBITDA is 0.1x. Net Debt / EBITDA surged on 0.3x from -1.8x to -1.5x in 2016. Debt surged on 94.5% while cash surged on 23.1%.
Appendix 1: Peers in Basic Materials
Below you can find Richmont Mines Inc 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 (82 companies) | 100.8% | -2.5% | 1.8% | -2.9% | 5.7% |
|---|
| Richmont Mines Inc ($RIC) | | -11.3% | 46.5% | 8.7% | 17.4% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Nevsun Resources Ltd ($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 (94 companies) | 32.2% | 22.7% | 19.1% | 16.4% | 24.7% |
|---|
| Richmont Mines Inc ($RIC) | 27.4% | 4.9% | 15.4% | 17.7% | 26.2% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Labrador Iron Ore Royalty Corp ($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 (100 companies) | 18.6% | 11.5% | 10.3% | 6.7% | 23.0% |
|---|
| Richmont Mines Inc ($RIC) | 8.0% | 4.2% | 23.3% | 22.3% | 26.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Largo Resources Ltd ($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 (100 companies) | 27.4% | 26.5% | 17.8% | 16.6% | 17.5% |
|---|
| Richmont Mines Inc ($RIC) | 37.2% | 46.4% | 17.4% | 36.2% | 37.5% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Lucara Diamond Corp ($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 (99 companies) | 4.9% | 1.3% | 1.2% | -3.8% | 4.0% |
|---|
| Richmont Mines Inc ($RIC) | -2.0% | -10.2% | 8.3% | 5.6% | 7.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Canam Group Inc ($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 (57 companies) | 0.3x | 0.9x | 1.2x | 1.6x | 0.7x |
|---|
| Richmont Mines Inc ($RIC) | -7.1x | -2.9x | -0.9x | -1.8x | -1.5x |
