Atlantic Power Corp Net Debt / EBITDA dropped on 226.7x from 251.1x to 24.3x in 2016 and Debt decreased slightly on 1.5%
02.03.2017 • About Atlantic Power Corp (
$ATP) • By InTwits
Atlantic Power Corp reported 2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Atlantic Power Corp doesn't have a profitable business model yet: 2016 ROIC is -5.5%
- EBITDA Margin is quite volatile: 9.0% in 2016, 0.9% in 2015, 12.8% in 2014, 24.0% in 2013, 36.2% in 2012
- Atlantic Power Corp has high CAPEX intensity: 5 year average CAPEX/Revenue was 23.9%. At the same time it's in pair with industry average of 33.0%.
- CAPEX is quite volatile: 7.2 in 2016, 11.3 in 2015, 13.4 in 2014, 44.8 in 2013, 459 in 2012
- The company has unprofitable business model: ROIC is at -5.5%
- It operates with high leverage: Net Debt/EBITDA is 24.3x while industry average is 8.0x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Atlantic Power Corp ($ATP) key annual financial indicators
| mln. $ | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 440.4 | 551.7 | 489.9 | 420.2 | 399.2 | -5.0% |
| Gross Profit | 148.5 | 193.4 | 166.8 | 150.5 | 144.5 | -4.0% |
| SG&A | 28.3 | 35.2 | 37.9 | 29.4 | 22.6 | -23.1% |
| EBITDA | 159.4 | 132.6 | 62.6 | 3.6 | 36.0 | 900.0% |
| Net Income | -112.8 | -33.0 | -165.8 | -53.6 | -113.9 | |
Balance Sheet
|
|---|
| Cash | 60.2 | 158.6 | 106.0 | 72.4 | 85.6 | 18.2% |
| Short Term Debt | 188.2 | 258.3 | 20.0 | 15.8 | 111.9 | 608.2% |
| Long Term Debt | 1,883.4 | 1,617.9 | 1,486.5 | 960.4 | 849.6 | -11.5% |
Cash flow
|
|---|
| Capex | 459.1 | 44.8 | 13.4 | 11.3 | 7.2 | -36.3% |
Ratios
|
|---|
| Revenue growth | 369.0% | 25.3% | -11.2% | -14.2% | -5.0% | |
| EBITDA growth | 343.2% | -16.8% | -52.8% | -94.2% | 900.0% | |
| Gross Margin | 33.7% | 35.1% | 34.0% | 35.8% | 36.2% | 0.4% |
| EBITDA Margin | 36.2% | 24.0% | 12.8% | 0.9% | 9.0% | 8.2% |
| Net Income Margin | -25.6% | -6.0% | -33.8% | -12.8% | -28.5% | -15.8% |
| SG&A, % of revenue | 6.4% | 6.4% | 7.7% | 7.0% | 5.7% | -1.3% |
| CAPEX, % of revenue | 104.2% | 8.1% | 2.7% | 2.7% | 1.8% | -0.9% |
| ROIC | 0.1% | -1.3% | -3.6% | -6.0% | -5.5% | 0.5% |
| ROE | -13.9% | -4.9% | -36.8% | -21.9% | -87.9% | -66.0% |
| Net Debt/EBITDA | 12.6x | 13.0x | 22.4x | 251.1x | 24.3x | -226.7x |
Atlantic Power Corp ($ATP) key quoterly financial indicators
| mln. $ | 16Q1 | 16Q2 | 16Q3 | 16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 106 | 98 | 101 | 93 | -4.4% | -4.8% | -5.9% | -5.1% |
| EBITDA | 40 | 27 | -54 | 23 | -6.9% | 17.2% | -256.6% | |
| Net Income | -13 | -16 | -80 | -4 | -173.7% | -210.9% | | |
Balance Sheet
|
|---|
| Cash | 64 | 154 | 94 | 86 | -35.8% | -60.8% | 22.8% | 18.2% |
| Short Term Debt | 16 | 96 | 101 | 112 | -19.1% | -70.6% | 503.6% | 608.2% |
| Long Term Debt | 938 | 971 | 880 | 850 | -33.6% | -9.0% | -14.6% | -11.5% |
Ratios
|
|---|
| Gross Margin | 43.5% | 33.7% | 35.8% | 30.9% | 5.3% | 4.8% | -2.9% | -6.4% |
| EBITDA Margin | 37.8% | 27.8% | -53.6% | 24.3% | -1.0% | 5.2% | -85.7% | 123.4% |
| Net Income Margin | -12.1% | -16.6% | -79.3% | -4.7% | -27.8% | -30.9% | -73.8% | 83.4% |
Revenue and profitability
The company's Revenue decreased on 5.0%. Revenue decline showed acceleration in 16Q4 - it was 5.1% YoY. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased on 8.2 pp from 0.86% to 9.0% in 2016.
Gross Margin showed almost no change in 2016. SG&A as a % of Revenue decreased slightly on 1.3 pp from 7.0% to 5.7% in 2016.
Net Income marign dropped on 15.8 pp from -12.8% to -28.5% in 2016.
Capital expenditures (CAPEX) and working capital investments
In 2016 Atlantic Power Corp had CAPEX/Revenue of 1.8%. CAPEX/Revenue decreased on 6.3 pp from 8.1% in 2013 to 1.8% in 2016. Average CAPEX/Revenue for the last three years was 2.4%.
Return on investment
The company operates at negative ROIC (-5.51%) and ROE (-87.90%). ROIC showed almost no change in 2016. ROE dropped on 66.0 pp from -21.9% to -87.9% in 2016.
Leverage (Debt)
Debt level is 24.3x Net Debt / EBITDA and 26.7x Debt / EBITDA. Net Debt / EBITDA dropped on 226.7x from 251.1x to 24.3x in 2016. Debt decreased slightly on 1.5% while cash surged on 18.2%.
Management team
James J Moore Jr "Jim" is a Atlantic Power Corp's CEO. James J Moore Jr "Jim" is a founder and has spent 3 years at the company. The company's CFO is Terrence Ronan "Terry". Terrence Ronan "Terry" has 6 years tenure at the company.
Appendix 1: Peers in Utilities
Below you can find Atlantic Power Corp benchmarking vs. other companies in Utilities 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 |
|---|
| Emera Inc ($EMA) | | 8.3% | 31.8% | -5.1% | 53.3% |
| Northland Power Inc ($NPI) | | 54.1% | 36.4% | -4.2% | 50.9% |
| Boralex Inc ($BLX) | | -6.7% | 13.5% | 37.1% | 11.7% |
| Algonquin Power & Utilities Corp ($AQN) | | 93.6% | 39.4% | 9.2% | 6.6% |
| TransAlta Corp ($TA) | | 3.7% | 14.4% | -13.6% | 5.7% |
| |
|---|
| Median (14 companies) | | 10.8% | 13.1% | -5.1% | 1.1% |
|---|
| Atlantic Power Corp ($ATP) | | 25.3% | -11.2% | -14.2% | -5.0% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Atco Ltd/Canada ($ACO.X) | 85.6% | 85.1% | 82.3% | 85.0% | 88.8% |
| Canadian Utilities Ltd ($CU) | 81.0% | 80.8% | 77.7% | 81.0% | 86.6% |
| Northland Power Inc ($NPI) | 52.5% | 63.7% | 61.8% | 69.0% | 82.4% |
| GWR Global Water Resources Corp ($GWR) | | | | 77.8% | 79.2% |
| Fortis Inc/Canada ($FTS) | 34.6% | 34.4% | 59.3% | 61.7% | 65.8% |
| |
|---|
| Median (12 companies) | 43.5% | 46.8% | 56.7% | 61.4% | 62.6% |
|---|
| Atlantic Power Corp ($ATP) | 33.7% | 35.1% | 34.0% | 35.8% | 36.2% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Northland Power Inc ($NPI) | 54.2% | 52.4% | 51.2% | 57.5% | 68.8% |
| Canadian Utilities Ltd ($CU) | 45.9% | 45.7% | 47.4% | 45.8% | 53.5% |
| Atco Ltd/Canada ($ACO.X) | 39.8% | 41.0% | 41.4% | 38.7% | 47.7% |
| TransAlta Corp ($TA) | 27.3% | 34.0% | 39.5% | 33.2% | 47.6% |
| Algonquin Power & Utilities Corp ($AQN) | 26.1% | 29.5% | 26.7% | 32.5% | 39.3% |
| |
|---|
| Median (12 companies) | 28.3% | 34.0% | 34.3% | 35.4% | 37.2% |
|---|
| Atlantic Power Corp ($ATP) | 36.2% | 24.0% | 12.8% | 0.9% | 9.0% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Northland Power Inc ($NPI) | 84.0% | 60.2% | 238.7% | 265.9% | 148.0% |
| Algonquin Power & Utilities Corp ($AQN) | 21.7% | 23.5% | 45.9% | 19.9% | 37.0% |
| Canadian Utilities Ltd ($CU) | 70.7% | 66.4% | 58.5% | 47.2% | 35.4% |
| Atco Ltd/Canada ($ACO.X) | 58.8% | 54.2% | 48.3% | 39.6% | 33.1% |
| Caribbean Utilities Co Ltd ($CUP.U) | 13.8% | 13.0% | 17.0% | 41.3% | 29.2% |
| |
|---|
| Median (12 companies) | 31.4% | 29.0% | 21.7% | 24.6% | 28.4% |
|---|
| Atlantic Power Corp ($ATP) | 104.2% | 8.1% | 2.7% | 2.7% | 1.8% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Keyera Corp ($KEY) | 13.8% | 12.7% | 14.3% | 12.6% | 10.5% |
| Atco Ltd/Canada ($ACO.X) | 10.8% | 10.5% | 9.6% | 5.6% | 8.1% |
| Canadian Utilities Ltd ($CU) | 10.0% | 9.4% | 9.2% | 5.9% | 8.0% |
| Northland Power Inc ($NPI) | 6.0% | 7.4% | 7.2% | 5.3% | 7.3% |
| Caribbean Utilities Co Ltd ($CUP.U) | 5.8% | 6.3% | 6.1% | 5.7% | 5.8% |
| |
|---|
| Median (14 companies) | 5.3% | 6.0% | 5.4% | 5.4% | 4.7% |
|---|
| Atlantic Power Corp ($ATP) | 0.1% | -1.3% | -3.6% | -6.0% | -5.5% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Emera Inc ($EMA) | 5.7x | 5.6x | 3.8x | 4.3x | 13.3x |
| Algonquin Power & Utilities Corp ($AQN) | 7.9x | 6.2x | 5.0x | 4.1x | 9.7x |
| Fortis Inc/Canada ($FTS) | 5.0x | 5.6x | 6.7x | 5.3x | 9.2x |
| GWR Global Water Resources Corp ($GWR) | | | | 6.3x | 8.1x |
| Northland Power Inc ($NPI) | 6.4x | 5.8x | 6.9x | 11.1x | 7.8x |
| |
|---|
| Median (11 companies) | 5.0x | 5.2x | 4.1x | 5.0x | 4.4x |
|---|
| Atlantic Power Corp ($ATP) | 12.6x | 13.0x | 22.4x | 251.1x | 24.3x |
