Painted Pony Petroleum Ltd reports 174% EBITDA growth and 21.5 pp EBITDA Margin growth from 30.4% to 51.9%
27.02.2017 • About Painted Pony Petroleum Ltd (
$PPY) • By InTwits
Painted Pony Petroleum Ltd reported 2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is quite volatile: 51.9% in 2016, 30.4% in 2015, 17.6% in 2014, 39.8% in 2013, -31.3% in 2012
- Painted Pony Petroleum Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 187.5%. At the same time it's a lot of higher than industry average of 45.3%.
- CAPEX is quite volatile: 204 in 2016, 107 in 2015, 264 in 2014, 143 in 2013, 234 in 2012
- The company has potentially unprofitable business model: ROIC is at 3.1%
- It operates with high leverage: Net Debt/EBITDA is 7.8x while industry average is 4.3x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Painted Pony Petroleum Ltd ($PPY) key annual financial indicators
| mln. CAD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 68.1 | 96.3 | 150.2 | 86.4 | 138.8 | 60.7% |
| Gross Profit | 44.4 | 59.9 | 99.5 | 42.3 | 88.4 | 109.1% |
| SG&A | 5.0 | 8.7 | 10.5 | 10.9 | 10.6 | -3.5% |
| EBITDA | -21.3 | 38.4 | 26.4 | 26.3 | 72.0 | 174.3% |
| Net Income | -48.1 | -5.7 | -15.6 | -5.2 | -51.9 | |
Balance Sheet
|
|---|
| Cash | 77.5 | 0.0 | 30.7 | 0.0 | 0.0 | |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
| Long Term Debt | 0.0 | 28.6 | 0.0 | 63.6 | 561.7 | 782.8% |
Cash flow
|
|---|
| Capex | 233.6 | 142.8 | 264.1 | 106.7 | 204.4 | 91.6% |
Ratios
|
|---|
| Revenue growth | 4.0% | 41.3% | 56.0% | -42.5% | 60.7% | |
| EBITDA growth | -149.5% | -279.8% | -31.2% | -0.5% | 174.3% | |
| Gross Margin | 65.1% | 62.2% | 66.2% | 48.9% | 63.7% | 14.7% |
| EBITDA Margin | -31.3% | 39.8% | 17.6% | 30.4% | 51.9% | 21.5% |
| Net Income Margin | -70.6% | -5.9% | -10.4% | -6.0% | -37.4% | -31.3% |
| SG&A, % of revenue | 7.4% | 9.0% | 7.0% | 12.7% | 7.6% | -5.1% |
| CAPEX, % of revenue | 342.9% | 148.3% | 175.8% | 123.4% | 147.2% | 23.8% |
| ROIC | -12.8% | -0.7% | -3.4% | -2.0% | 3.1% | 5.0% |
| ROE | -10.0% | -1.0% | -2.5% | -0.8% | -8.0% | -7.2% |
| Net Debt/EBITDA | | 0.7x | -1.2x | 2.4x | 7.8x | 5.4x |
Painted Pony Petroleum Ltd ($PPY) key quoterly financial indicators
| mln. CAD | 16Q1 | 16Q2 | 16Q3 | 16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 22 | 22 | 33 | 62 | -14.0% | -6.2% | 58.7% | 271.6% |
| EBITDA | 8 | 9 | 18 | 37 | -17.1% | 0.2% | 192.3% | 2,037.8% |
| Net Income | -2 | -34 | 12 | -28 | | | | -1,188.7% |
Balance Sheet
|
|---|
| Cash | 0 | 0 | 0 | 0 | | | | |
| Short Term Debt | 0 | 0 | 0 | 0 | | | | |
| Long Term Debt | 88 | 137 | 537 | 562 | 1,043.7% | 252.8% | 1,069.3% | 782.8% |
Ratios
|
|---|
| Gross Margin | 50.6% | 58.5% | 67.1% | 68.3% | 2.5% | 5.0% | 21.6% | 20.4% |
| EBITDA Margin | 34.7% | 41.1% | 56.1% | 59.6% | -1.3% | 2.6% | 25.6% | 49.3% |
| Net Income Margin | -9.9% | -149.7% | 35.7% | -44.7% | 4.0% | -133.6% | 37.6% | -59.9% |
Revenue and profitability
Painted Pony Petroleum Ltd's Revenue jumped on 60.7%. Revenue growth showed acceleration in 16Q4 - it increased 271.6% YoY. Revenue growth happened at the same time with EBITDA margin expansion. EBITDA Margin jumped on 21.5 pp from 30.4% to 51.9% in 2016.
Gross Margin surged on 14.7 pp from 48.9% to 63.7% in 2016. SG&A as a % of Revenue decreased on 5.1 pp from 12.7% to 7.6% in 2016.
Net Income marign dropped on 31.3 pp from -6.0% to -37.4% in 2016.
Capital expenditures (CAPEX) and working capital investments
Painted Pony Petroleum Ltd's CAPEX/Revenue was 147% in 2016. CAPEX/Revenue decreased slightly on 1.1 pp from 148% in 2013 to 147% in 2016. It's average CAPEX/Revenue for the last three years was 149%.To secure this fast growth the company made large investments to CAPEX (284% of EBITDA).
Return on investment
The company operates at low but positive ROIC (3.06%) and negative ROE (-7.99%). ROIC increased on 5.0 pp from -2.0% to 3.1% in 2016. ROE decreased on 7.2 pp from -0.78% to -8.0% in 2016.
Leverage (Debt)
Debt level is 7.8x Net Debt / EBITDA and 7.8x Debt / EBITDA. Net Debt / EBITDA surged on 5.4x from 2.4x to 7.8x in 2016. Debt jumped on 783% while cash didn't change in 2016.
Appendix 1: Peers in Energy
Below you can find Painted Pony Petroleum Ltd benchmarking vs. other companies in Energy 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 |
|---|
| 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% |
| ONEnergy Inc ($OEG) | | | 6,002.6% | 231.5% | 57.4% |
| Ballard Power Systems Inc ($BLD) | | 40.2% | 12.2% | -17.8% | 51.0% |
| |
|---|
| Median (116 companies) | | 15.4% | 16.9% | -27.7% | -19.1% |
|---|
| Painted Pony Petroleum Ltd ($PPY) | | 41.3% | 56.0% | -42.5% | 60.7% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Americas Petrogas Inc ($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% | 32.1% | 32.2% | 33.6% | 31.5% |
|---|
| Painted Pony Petroleum Ltd ($PPY) | 65.1% | 62.2% | 66.2% | 48.9% | 63.7% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Granite Oil Corp ($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% | 34.1% | 28.9% | 8.1% | 27.3% |
|---|
| Painted Pony Petroleum Ltd ($PPY) | -31.3% | 39.8% | 17.6% | 30.4% | 51.9% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Oryx Petroleum Corp Ltd ($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% | 39.0% | 45.0% | 27.6% | 22.9% |
|---|
| Painted Pony Petroleum Ltd ($PPY) | 342.9% | 148.3% | 175.8% | 123.4% | 147.2% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Enerplus Corp ($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% |
|---|
| Painted Pony Petroleum Ltd ($PPY) | -12.8% | -0.7% | -3.4% | -2.0% | 3.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| BlackPearl Resources Inc ($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 | 1.5x | 1.4x | 2.7x | 2.6x |
|---|
| Painted Pony Petroleum Ltd ($PPY) | | 0.7x | -1.2x | 2.4x | 7.8x |
