Labrador Iron Ore Royalty Corp reports 43.0% Net Income growth and 13.2% Revenue growth
02.03.2017 • About Labrador Iron Ore Royalty Corp (
$LIF) • By InTwits
Labrador Iron Ore Royalty Corp reported 2016 financial results today. Overall the company's long term financial model is characterised by the following facts: The company has business model with average profitability: ROIC is at 12.0%.
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Labrador Iron Ore Royalty Corp ($LIF) key annual financial indicators
| mln. CAD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 123.8 | 139.1 | 117.1 | 101.4 | 114.9 | 13.2% |
| Gross Profit | 99.3 | 111.6 | 94.0 | 81.5 | 92.3 | 13.2% |
| SG&A | 2.4 | 2.8 | 2.4 | 2.7 | 2.7 | 0.4% |
| EBITDA | | | | 73.9 | 84.4 | 14.2% |
| Net Income | 99.3 | 148.8 | 104.1 | 54.7 | 78.2 | 43.0% |
Balance Sheet
|
|---|
| Cash | 26.9 | 52.6 | 35.0 | 24.5 | 23.9 | -2.2% |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Ratios
|
|---|
| Revenue growth | -23.6% | 12.3% | -15.8% | -13.4% | 13.2% | |
| EBITDA growth | | | | | 14.2% | |
| Gross Margin | 80.2% | 80.2% | 80.2% | 80.3% | 80.3% | -0.0% |
| EBITDA Margin | 0.0% | 0.0% | 0.0% | 72.8% | 73.5% | 0.6% |
| Net Income Margin | 80.2% | 107.0% | 88.9% | 53.9% | 68.1% | 14.2% |
| SG&A, % of revenue | 1.9% | 2.0% | 2.0% | 2.7% | 2.4% | -0.3% |
| ROIC | 14.3% | 15.2% | 12.3% | 10.6% | 12.0% | 1.4% |
| ROE | 24.3% | 26.4% | 17.9% | 9.5% | 13.6% | 4.0% |
| Net Debt/EBITDA | | | | -0.3x | -0.3x | 0.0x |
Labrador Iron Ore Royalty Corp ($LIF) key quoterly financial indicators
| mln. CAD | 16Q1 | 16Q2 | 16Q3 | 16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 22 | 26 | 28 | 38 | -6.0% | 7.8% | -11.2% | 75.6% |
| Net Income | 11 | 8 | 21 | 38 | 10.4% | -46.6% | 11.4% | 269.3% |
Balance Sheet
|
|---|
| Cash | 21 | 13 | 12 | 24 | -24.6% | -48.5% | -43.0% | -2.2% |
| Short Term Debt | 0 | 0 | 0 | 0 | | | | |
| Long Term Debt | 0 | 0 | 0 | 0 | | | | |
Ratios
|
|---|
| Gross Margin | 80.4% | 80.3% | 80.3% | 80.2% | 0.1% | 0.0% | -0.0% | -0.2% |
| Net Income Margin | 49.4% | 32.1% | 74.6% | 98.1% | 7.3% | -32.7% | 15.1% | 51.4% |
Revenue and profitability
The company's Revenue surged on 13.2%. Revenue growth showed acceleration in 16Q4 - it increased 75.6% YoY. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 4.7 pp from 53.2% to 57.8% 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 jumped on 14.2 pp from 53.9% to 68.1% in 2016.
Return on investment
The company operates at good ROE (13.56%) while ROIC is low (12.00%). ROIC increased slightly on 1.4 pp from 10.6% to 12.0% in 2016. ROE increased on 4.0 pp from 9.5% to 13.6% in 2016.
Leverage (Debt)
The company has no debt. Cash decreased on 2.2%.
Management team
The company's CEO William H Mcneil is a founder and has spent 2 years at the company. The company's CFO Alan Richard Thomas has spent 8 years at the company.
Appendix 1: Peers in Basic Materials
Below you can find Labrador Iron Ore Royalty Corp 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% | -3.8% | 2.0% | -1.7% | 5.7% |
|---|
| Labrador Iron Ore Royalty Corp ($LIF) | | 12.3% | -15.8% | -13.4% | 13.2% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Nevsun Resources Ltd ($NSU) | 89.9% | 94.8% | 95.5% | 82.3% | 79.7% |
| 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 ($PRU) | 52.5% | 50.9% | 32.0% | 53.7% | 26.3% |
| Banro Corp ($BAA) | 48.1% | 39.8% | 44.9% | 52.2% | |
| |
|---|
| Median (94 companies) | 32.1% | 22.1% | 18.2% | 16.4% | 24.7% |
|---|
| Labrador Iron Ore Royalty Corp ($LIF) | 80.2% | 80.2% | 80.2% | 80.3% | 80.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Silver Wheaton Corp ($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 ($SSL) | 74.3% | 49.9% | 62.1% | 56.5% | 64.6% |
| Alacer Gold Corp ($ASR) | 67.1% | 57.6% | 50.5% | 51.5% | 25.6% |
| |
|---|
| Median (100 companies) | 18.6% | 11.3% | 10.6% | 6.7% | 23.0% |
|---|
| Labrador Iron Ore Royalty Corp ($LIF) | | | | 72.8% | 73.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Largo Resources Ltd ($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) | 28.1% | 27.4% | 17.8% | 17.2% | 18.3% |
|---|
| Labrador Iron Ore Royalty Corp ($LIF) | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Lucara Diamond Corp ($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% | 0.1% | 1.2% | -3.8% | 4.0% |
|---|
| Labrador Iron Ore Royalty Corp ($LIF) | 14.3% | 15.2% | 12.3% | 10.6% | 12.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Canam Group Inc ($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 | 0.8x | 1.1x | 1.6x | 0.7x |
|---|
| Labrador Iron Ore Royalty Corp ($LIF) | | | | -0.3x | -0.3x |
