Tethys Petroleum Limited reports 83.0% CAPEX decline in 2016 and 47.0% Revenue decline
04.03.2017 • About Tethys Petroleum Limited (
$TPL) • By InTwits
Tethys Petroleum Limited reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Tethys Petroleum Limited is a company in decline: FY2016 revenue growth was -47.0%, 5 years revenue CAGR was -12.5%
- The company operates at negative EBITDA Margin: -261.2%
- Tethys Petroleum Limited spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for FY2012-FY2016 is 0.0%. Average EBITDA Margin for the same period was -55.2%0
- Tethys Petroleum Limited has high CAPEX intensity: 5 year average CAPEX/Revenue was 52.2%. At the same time it's a lot of higher than industry average of 23.0%.
- CAPEX is quite volatile: 1.4 in FY2016, 8.3 in FY2015, 26.1 in FY2014, 23.8 in FY2013, 17.5 in FY2012
- The company has unprofitable business model: ROIC is at -26.0%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Tethys Petroleum Limited ($TPL) key annual financial indicators
| mln. $ | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 33.629 | 36.945 | 27.389 | 22.135 | 11.734 | -47.0% |
| Gross Profit | 4.953 | 10.686 | 12.643 | -16.828 | -3.522 | |
| SG&A | | 21.739 | 19.934 | 13.702 | 7.904 | -42.3% |
| EBITDA | -0.448 | -1.076 | -8.126 | -32.426 | -30.655 | |
| Net Income | -20.423 | -17.148 | -16.027 | -74.629 | -46.852 | |
Balance Sheet
|
|---|
| Cash | 1.750 | 25.109 | 3.112 | 3.272 | 0.449 | -86.3% |
| Short Term Debt | 13.625 | 4.965 | 5.139 | 9.159 | 33.249 | 263.0% |
| Long Term Debt | 3.688 | 0.000 | 5.489 | 22.873 | | -100.0% |
Cash flow
|
|---|
| Capex | 17.501 | 23.809 | 26.069 | 8.293 | 1.408 | -83.0% |
Ratios
|
|---|
| Revenue growth | 46.7% | 9.9% | -25.9% | -19.2% | -47.0% | |
| EBITDA growth | -95.3% | 140.2% | 655.2% | 299.0% | -5.5% | |
| Gross Margin | 14.7% | 28.9% | 46.2% | -76.0% | -30.0% | 46.0% |
| EBITDA Margin | -1.3% | -2.9% | -29.7% | -146.5% | -261.2% | -114.8% |
| Net Income Margin | -60.7% | -46.4% | -58.5% | -337.2% | -399.3% | -62.1% |
| SG&A, % of revenue | | 58.8% | 72.8% | 61.9% | 67.4% | 5.5% |
| CAPEX, % of revenue | 52.0% | 64.4% | 95.2% | 37.5% | 12.0% | -25.5% |
| ROIC | -7.7% | -6.5% | -4.4% | -31.3% | -26.0% | 5.3% |
| ROE | -9.3% | -8.4% | -8.1% | -45.9% | -44.1% | 1.8% |
Tethys Petroleum Limited ($TPL) key quoterly financial indicators
| mln. $ | FY16Q1 | FY16Q2 | FY16Q3 | FY16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 3 | 4 | 3 | 2 | -42.0% | -48.4% | -45.6% | -54.8% |
| EBITDA | -1 | -1 | -1 | -28 | | | -87,700.0% | |
| Net Income | -6 | -5 | -4 | -32 | | | | |
Balance Sheet
|
|---|
| Cash | 1 | 1 | 2 | 0 | -78.5% | -85.8% | -58.0% | -86.3% |
| Short Term Debt | 11 | 28 | 32 | 33 | 107.4% | 374.4% | 235.7% | 263.0% |
| Long Term Debt | 20 | 2 | 2 | 0 | 72.8% | -89.8% | -92.1% | -100.0% |
Ratios
|
|---|
| Gross Margin | -17.3% | -20.6% | -42.7% | -53.1% | -73.5% | 241.7% | -46.4% | -3.9% |
| EBITDA Margin | -31.5% | -14.7% | -28.1% | -1,727.2% | -12.2% | 48.9% | -28.1% | -980.7% |
| Net Income Margin | -164.3% | -135.3% | -134.5% | -1,974.4% | -129.5% | 234.8% | -69.8% | -767.6% |
Revenue and profitability
The company's Revenue dropped on 47.0%. Revenue decline showed acceleration in FY16Q4 - it was 54.8% YoY. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 2.6 pp from 23.8% to 26.4% in FY2016.
Gross Margin jumped on 46.0 pp from -76.0% to -30.0% in FY2016. SG&A as a % of Revenue increased on 5.5 pp from 61.9% to 67.4% in FY2016.
Net Income marign dropped on 62.1 pp from -337% to -399% in FY2016.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 12.0% in FY2016. The company's CAPEX/Revenue dropped on 52.4 pp from 64.4% in FY2013 to 12.0% in FY2016. Average CAPEX/Revenue for the last three years was 48.2%.
Return on investment
The company operates at negative ROIC (-26.01%) and ROE (-44.07%). ROIC increased on 5.3 pp from -31.3% to -26.0% in FY2016. ROE increased slightly on 1.8 pp from -45.9% to -44.1% in FY2016.
Appendix 1: Peers in Oil & Gas Producers
Below we provide Tethys Petroleum Limited benchmarking against other companies in Oil & Gas Producers 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 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Ithaca Energy Inc ($IAE) | | 144.8% | -8.0% | -2.0% | -42.2% |
| Caza Oil & Gas Inc ($CAZ) | 21.5% | 67.0% | 178.3% | -22.2% | |
| |
|---|
| Median (2 companies) | 21.5% | 105.9% | 85.2% | -12.1% | -42.2% |
|---|
| Tethys Petroleum Limited ($TPL) | | 9.9% | -25.9% | -19.2% | -47.0% |
Top companies by Gross margin, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Caza Oil & Gas Inc ($CAZ) | 0.1% | 30.5% | 40.8% | 44.8% | |
| Ithaca Energy Inc ($IAE) | 22.5% | 23.4% | -2.9% | 39.5% | 34.4% |
| |
|---|
| Median (2 companies) | 11.3% | 26.9% | 19.0% | 42.2% | 34.4% |
|---|
| Tethys Petroleum Limited ($TPL) | 14.7% | 28.9% | 46.2% | -76.0% | -30.0% |
Top companies by EBITDA margin, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Caza Oil & Gas Inc ($CAZ) | -50.7% | -3.0% | 47.7% | 49.8% | |
| Ithaca Energy Inc ($IAE) | 49.3% | 38.8% | -78.0% | -43.7% | 62.2% |
| |
|---|
| Median (2 companies) | -0.7% | 17.9% | -15.1% | 3.0% | 62.2% |
|---|
| Tethys Petroleum Limited ($TPL) | -1.3% | -2.9% | -29.7% | -146.5% | -261.2% |
Top companies by CAPEX/Revenue, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Ithaca Energy Inc ($IAE) | 95.1% | 83.4% | 103.5% | 42.8% | 41.6% |
| Caza Oil & Gas Inc ($CAZ) | 249.9% | 352.9% | 177.4% | 15.5% | |
| |
|---|
| Median (2 companies) | 172.5% | 218.2% | 140.4% | 29.2% | 41.6% |
|---|
| Tethys Petroleum Limited ($TPL) | 52.0% | 64.4% | 95.2% | 37.5% | 12.0% |
Top companies by ROIC, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Caza Oil & Gas Inc ($CAZ) | -15.2% | -7.9% | 5.2% | 4.5% | |
| Ithaca Energy Inc ($IAE) | 4.6% | 0.7% | -34.0% | -22.0% | 6.3% |
| |
|---|
| Median (2 companies) | -5.3% | -3.6% | -14.4% | -8.7% | 6.3% |
|---|
| Tethys Petroleum Limited ($TPL) | -7.7% | -6.5% | -4.4% | -31.3% | -26.0% |
Top companies by Net Debt / EBITDA
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Ithaca Energy Inc ($IAE) | -0.4x | 2.2x | | | 4.5x |
| |
|---|
| Median (1 company) | -0.4x | 2.2x | 3.4x | -0.2x | 4.5x |
|---|
