PHX Energy Services Corp CAPEX dropped on 56.7% in 2016 and Revenue dropped on 48.3%
22.02.2017 • About PHX Energy Services Corp (
$PHX) • By InTwits
PHX Energy Services Corp reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- PHX Energy Services Corp is a company in decline: FY2016 revenue growth was -48.3%, 5 years revenue CAGR was -10.6%
- The company operates at negative EBITDA Margin: -5.4%
- EBITDA Margin is quite volatile: -5.4% in FY2016, -0.2% in FY2015, 16.0% in FY2014, 19.6% in FY2013, 16.1% in FY2012
- PHX Energy Services Corp has high CAPEX intensity: 5 year average CAPEX/Revenue was 10.5%. At the same time it's in pair with industry average of 7.1%.
- CAPEX is quite volatile: 7.8 in FY2016, 18.0 in FY2015, 68.3 in FY2014, 41.8 in FY2013, 51.5 in FY2012
- The company has unprofitable business model: ROIC is at -24.9%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
PHX Energy Services Corp ($PHX) key annual financial indicators
| mln. CAD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 301.7 | 380.7 | 521.5 | 286.8 | 148.4 | -48.3% |
| Gross Profit | 63.6 | 73.0 | 106.9 | 11.1 | -24.1 | -316.1% |
| SG&A | | 43.6 | 57.0 | 37.3 | 31.6 | -15.2% |
| EBITDA | 48.4 | 74.6 | 83.5 | -0.5 | -8.0 | |
| Net Income | 17.7 | 36.6 | 22.0 | -42.5 | -46.5 | |
Balance Sheet
|
|---|
| Cash | 4.3 | 5.7 | 3.0 | 9.0 | 7.0 | -22.2% |
| Short Term Debt | 20.9 | 0.2 | 5.7 | 0.0 | 6.0 | |
| Long Term Debt | 80.0 | 70.4 | 104.3 | 60.0 | 29.0 | -51.6% |
Cash flow
|
|---|
| Capex | 51.5 | 41.8 | 68.3 | 18.0 | 7.8 | -56.7% |
Ratios
|
|---|
| Revenue growth | 16.0% | 26.2% | 37.0% | -45.0% | -48.3% | |
| EBITDA growth | | 54.0% | 12.0% | -100.6% | 1,506.9% | |
| Gross Margin | 21.1% | 19.2% | 20.5% | 3.9% | -16.2% | -20.1% |
| EBITDA Margin | 16.1% | 19.6% | 16.0% | -0.2% | -5.4% | -5.2% |
| Net Income Margin | 5.9% | 9.6% | 4.2% | -14.8% | -31.3% | -16.5% |
| SG&A, % of revenue | | 11.5% | 10.9% | 13.0% | 21.3% | 8.3% |
| CAPEX, % of revenue | 17.1% | 11.0% | 13.1% | 6.3% | 5.3% | -1.0% |
| ROIC | | 19.8% | 17.2% | -16.9% | -24.9% | -8.0% |
| ROE | | 23.3% | 11.0% | -21.2% | -24.5% | -3.3% |
| Net Debt/EBITDA | 2.0x | 0.9x | 1.3x | | | 0.0x |
PHX Energy Services Corp ($PHX) key quoterly financial indicators
| mln. CAD | FY16Q1 | FY16Q2 | FY16Q3 | FY16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 40 | 26 | 35 | 47 | -61.1% | -54.9% | -48.8% | -16.9% |
| EBITDA | 1 | -4 | -3 | -3 | -57.2% | -27,684.0% | | -129.6% |
| Net Income | -7 | -13 | -11 | -15 | | | | |
Balance Sheet
|
|---|
| Cash | 2 | 2 | 3 | 7 | -82.7% | -34.8% | -9.8% | -22.2% |
| Short Term Debt | 1 | 4 | 9 | 6 | 265.3% | -3.6% | 2,827.9% | |
| Long Term Debt | 50 | 22 | 20 | 29 | -55.6% | -67.1% | -71.4% | -51.6% |
Ratios
|
|---|
| Gross Margin | -13.7% | -37.5% | -16.2% | -6.4% | -20.5% | -37.3% | -18.6% | -11.2% |
| EBITDA Margin | 3.1% | -15.1% | -7.3% | -5.7% | 0.3% | -15.1% | 10.8% | -21.7% |
| Net Income Margin | -18.3% | -50.7% | -30.5% | -32.3% | -12.6% | -36.5% | 5.4% | -25.6% |
Revenue and profitability
The company's Revenue dropped on 48.3%. Annual revenue decline showed slowdown in FY16Q4 - revenue dropped on 16.9%. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 5.2 pp from -0.17% to -5.4% in FY2016.
Gross Margin dropped on 20.1 pp from 3.9% to -16.2% in FY2016. SG&A as a % of Revenue increased on 8.3 pp from 13.0% to 21.3% in FY2016.
Net Income marign dropped on 16.5 pp from -14.8% to -31.3% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 the company had CAPEX/Revenue of 5.3%. CAPEX/Revenue decreased on 5.7 pp from 11.0% in FY2013 to 5.3% in FY2016. It's average level of CAPEX/Revenue for the last three years was 8.2%.
Return on investment
The company operates at negative ROIC (-24.86%) and ROE (-24.53%). ROIC decreased on 8.0 pp from -16.9% to -24.9% in FY2016. ROE decreased on 3.3 pp from -21.2% to -24.5% in FY2016.
Leverage (Debt)
Debt level is 1.6x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA didn't change in FY2016. Debt dropped on 41.6% while cash dropped on 22.2%.
Appendix 1: Peers in Energy
Below we provide PHX Energy Services Corp 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) | | 15.4% | 16.9% | -27.7% | -18.0% |
|---|
| PHX Energy Services Corp ($PHX) | | 26.2% | 37.0% | -45.0% | -48.3% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Americas Petrogas Inc ($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% | 33.9% | 32.5% |
|---|
| PHX Energy Services Corp ($PHX) | 21.1% | 19.2% | 20.5% | 3.9% | -16.2% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Granite Oil Corp ($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% | 9.0% | 29.2% |
|---|
| PHX Energy Services Corp ($PHX) | 16.1% | 19.6% | 16.0% | -0.2% | -5.4% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Oryx Petroleum Corp Ltd ($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) | 43.8% | 39.2% | 45.6% | 28.1% | 23.8% |
|---|
| PHX Energy Services Corp ($PHX) | 17.1% | 11.0% | 13.1% | 6.3% | 5.3% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Enerplus Corp ($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) | 3.8% | 5.4% | 5.5% | -8.2% | -1.9% |
|---|
| PHX Energy Services Corp ($PHX) | | 19.8% | 17.2% | -16.9% | -24.9% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| BlackPearl Resources Inc ($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 (79 companies) | 1.5x | 1.5x | 1.4x | 2.6x | 2.7x |
|---|
