Extendicare Inc reports 84.7% Net Income decline while 12.5% Revenue growth
28.02.2017 • About Extendicare Inc (
$EXE) • By InTwits
Extendicare Inc reported 2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Extendicare Inc has low CAPEX intensity: 5 year average CAPEX/Revenue was 4.5%. At the same time it's a lot of higher than industry average of 3.1%.
- CAPEX is quite volatile: 38.8 in 2016, 35.5 in 2015, 30.2 in 2014, 55.8 in 2013, 84.1 in 2012
- The company has business model with low profitability: ROIC is at 8.7%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Extendicare Inc ($EXE) key annual financial indicators
| mln. CAD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 2,037 | 784 | 816 | 943 | 1,061 | 12.5% |
| Gross Profit | 257 | 106 | 108 | 120 | 130 | 8.6% |
| SG&A | 63 | 31 | 28 | 30 | 31 | 1.4% |
| EBITDA | 183 | 124 | 116 | 81 | 90 | 11.8% |
| Net Income | 63 | 5 | -19 | 232 | 35 | -84.7% |
Balance Sheet
|
|---|
| Cash | 71 | 96 | 35 | 104 | 102 | -2.0% |
| Short Term Debt | 93 | 148 | 26 | 25 | 55 | 115.9% |
| Long Term Debt | 1,039 | 1,017 | 453 | 429 | 449 | 4.7% |
Cash flow
|
|---|
| Capex | 84 | 56 | 30 | 35 | 39 | 9.5% |
Ratios
|
|---|
| Revenue growth | -2.7% | -61.5% | 4.1% | 15.6% | 12.5% | |
| EBITDA growth | -8.5% | -32.4% | -6.6% | -30.3% | 11.8% | |
| Gross Margin | 12.6% | 13.5% | 13.2% | 12.7% | 12.3% | -0.4% |
| EBITDA Margin | 9.0% | 15.8% | 14.2% | 8.5% | 8.5% | -0.0% |
| Net Income Margin | 3.1% | 0.7% | -2.3% | 24.6% | 3.3% | -21.3% |
| SG&A, % of revenue | 3.1% | 4.0% | 3.5% | 3.2% | 2.9% | -0.3% |
| CAPEX, % of revenue | 4.1% | 7.1% | 3.7% | 3.8% | 3.7% | -0.1% |
| ROIC | 7.8% | 3.3% | 5.0% | 9.4% | 8.7% | -0.7% |
| ROE | 121.7% | 11.5% | | | 20.4% | 20.4% |
| Net Debt/EBITDA | 5.8x | 8.6x | 3.8x | 4.3x | 4.5x | 0.1x |
Extendicare Inc ($EXE) key quoterly financial indicators
| mln. CAD | 16Q1 | 16Q2 | 16Q3 | 16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 262 | 261 | 268 | 277 | 29.8% | 11.5% | 5.7% | 5.4% |
| EBITDA | 14 | 27 | 26 | 23 | -11.1% | 23.1% | 10.8% | 10.4% |
| Net Income | -3 | 5 | 9 | 25 | -148.1% | | -95.7% | 133.7% |
Balance Sheet
|
|---|
| Cash | 43 | 39 | 88 | 102 | 5.9% | -73.0% | -53.7% | -2.0% |
| Short Term Debt | 45 | 47 | 48 | 55 | 139.0% | -51.3% | 147.7% | 115.9% |
| Long Term Debt | 404 | 400 | 452 | 449 | -9.8% | -9.9% | 3.0% | 4.7% |
Ratios
|
|---|
| Gross Margin | 10.7% | 13.3% | 13.1% | 12.2% | -2.1% | 0.0% | 0.3% | -0.3% |
| EBITDA Margin | 5.5% | 10.2% | 9.5% | 8.2% | -2.5% | 1.0% | 0.4% | 0.4% |
| Net Income Margin | -1.2% | 1.8% | 3.5% | 8.9% | -4.6% | 2.5% | -81.8% | 4.9% |
Revenue and profitability
Extendicare Inc's Revenue jumped on 12.5%. Revenue growth showed slow down in 16Q4 - it was 5.4% YoY. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased slightly on 0.64 pp from 6.9% to 7.6% in 2016.
Gross Margin showed almost no change in 2016. SG&A as a % of Revenue showed almost no change in 2016.
Net Income marign dropped on 21.3 pp from 24.6% to 3.3% in 2016.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 3.7% in 2016. Extendicare Inc's CAPEX/Revenue decreased on 3.5 pp from 7.1% in 2013 to 3.7% in 2016. Average CAPEX/Revenue for the last three years was 3.7%.
Return on investment
The company operates at good ROE (20.44%) while ROIC is low (8.72%). ROIC decreased slightly on 0.72 pp from 9.4% to 8.7% in 2016.
Leverage (Debt)
Company's Net Debt / EBITDA is 4.5x and Debt / EBITDA is 5.6x. Net Debt / EBITDA jumped on 0.1x from 4.3x to 4.5x in 2016. Debt jumped on 10.9% while cash decreased slightly on 2.0%.
Management team
The company's CEO is Timothy Louis Lukenda "Tim". Timothy Louis Lukenda "Tim" is a founder and has 10 years tenure at the company. The company's CFO Elaine E Everson has spent 3 years at the company.
Appendix 1: Peers in Consumer, Non-cyclical
Below you can find Extendicare Inc benchmarking vs. other companies in Consumer, Non-cyclical 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 |
|---|
| Concordia Healthcare Corp ($CXR) | | | 159.5% | 275.7% | 107.0% |
| Heritage Global Inc ($HGP) | | -37.0% | 76.2% | 11.2% | 80.8% |
| EnerCare Inc ($ECI) | | 8.6% | 21.1% | 55.7% | 76.6% |
| CRH Medical Corp ($CRH) | | 12.5% | 56.0% | 284.2% | 70.2% |
| Nuvo Research Inc ($NRI) | | -25.3% | -29.1% | 57.0% | 31.9% |
| |
|---|
| Median (40 companies) | | 9.1% | 13.9% | 14.9% | 12.8% |
|---|
| Extendicare Inc ($EXE) | | -61.5% | 4.1% | 15.6% | 12.5% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Cipher Pharmaceuticals Inc ($CPH) | | 99.5% | 98.3% | 92.7% | |
| Ritchie Bros Auctioneers Inc ($RBA) | 88.7% | 88.4% | 88.0% | 89.1% | 88.3% |
| Information Services Corp ($ISV) | 77.5% | 80.4% | 80.9% | 87.6% | 85.1% |
| Biosyent Inc ($RX) | 79.3% | 79.2% | 78.1% | 78.7% | |
| Concordia Healthcare Corp ($CXR) | | 79.4% | 86.0% | 76.1% | 72.9% |
| |
|---|
| Median (34 companies) | 35.4% | 39.2% | 35.8% | 36.1% | 33.2% |
|---|
| Extendicare Inc ($EXE) | 12.6% | 13.5% | 13.2% | 12.7% | 12.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| CRH Medical Corp ($CRH) | 21.0% | 24.5% | 29.1% | 44.1% | |
| Valeant Pharmaceuticals International Inc ($VRX) | 30.6% | 27.8% | 45.6% | 39.8% | 23.8% |
| Concordia Healthcare Corp ($CXR) | | 43.7% | 37.0% | 39.8% | -92.8% |
| Ritchie Bros Auctioneers Inc ($RBA) | 36.8% | 36.3% | 36.4% | 39.7% | 31.4% |
| EnerCare Inc ($ECI) | 52.8% | 51.0% | 45.5% | 39.3% | 26.6% |
| |
|---|
| Median (43 companies) | 9.9% | 12.0% | 12.7% | 12.7% | 10.7% |
|---|
| Extendicare Inc ($EXE) | 9.0% | 15.8% | 14.2% | 8.5% | 8.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| ProMetic Life Sciences Inc ($PLI) | 2.1% | 33.6% | 34.6% | 23.3% | |
| EnerCare Inc ($ECI) | 25.7% | 26.5% | 23.6% | 20.7% | 15.5% |
| Black Diamond Group Ltd ($BDI) | 61.9% | 27.5% | 31.0% | 17.6% | |
| easyhome Ltd ($EH) | 32.2% | 25.6% | 21.6% | 16.9% | 12.7% |
| K-Bro Linen Inc ($KBL) | 10.0% | 19.0% | 11.4% | 16.6% | |
| |
|---|
| Median (42 companies) | 3.1% | 2.7% | 2.3% | 2.3% | 2.0% |
|---|
| Extendicare Inc ($EXE) | 4.1% | 7.1% | 3.7% | 3.8% | 3.7% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Information Services Corp ($ISV) | 71.8% | 72.8% | 58.9% | 38.1% | 27.6% |
| Colliers International Group Inc ($CIG) | 10.5% | 11.2% | 15.2% | 10.9% | 26.1% |
| Nuvo Research Inc ($NRI) | -11.6% | -17.4% | -37.9% | 12.9% | 20.8% |
| International Road Dynamics Inc ($IRD) | 0.9% | 6.7% | 4.4% | 10.6% | 16.5% |
| Premium Brands Holdings Corp ($PBH) | 10.3% | 9.9% | 6.9% | 12.6% | 15.3% |
| |
|---|
| Median (43 companies) | 8.8% | 9.2% | 8.5% | 6.3% | 8.0% |
|---|
| Extendicare Inc ($EXE) | 7.8% | 3.3% | 5.0% | 9.4% | 8.7% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Concordia Healthcare Corp ($CXR) | | -1.3x | 5.6x | 20.2x | |
| SunOpta Inc ($SOY) | 2.9x | 3.5x | 1.3x | 16.9x | 140.8x |
| Centric Health Corp ($CHH) | 5.6x | 10.2x | 11.2x | 15.6x | |
| Sienna Senior Living Inc ($SIA) | 9.5x | 11.8x | 9.2x | 9.1x | 9.1x |
| Valeant Pharmaceuticals International Inc ($VRX) | 9.5x | 10.4x | 4.0x | 7.3x | 12.7x |
| |
|---|
| Median (37 companies) | 2.8x | 2.2x | 3.3x | 2.3x | 2.7x |
|---|
| Extendicare Inc ($EXE) | 5.8x | 8.6x | 3.8x | 4.3x | 4.5x |
