Trilogy Energy Corp EBITDA surged on 269% in 2016 while Revenue dropped on 24.7%
07.03.2017 • About Trilogy Energy Corp (
$TET) • By InTwits
Trilogy Energy Corp reported 2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Trilogy Energy Corp is a company in decline: 2016 revenue growth was -24.7%, 5 years revenue CAGR was -10.1%
- EBITDA Margin is quite volatile: 38.5% in 2016, 7.9% in 2015, 56.5% in 2014, 61.7% in 2013, 57.3% in 2012
- Trilogy Energy Corp has high CAPEX intensity: 5 year average CAPEX/Revenue was 56.1%. At the same time it's a lot of higher than industry average of 45.3%.
- CAPEX is quite volatile: 51 in 2016, 73.6 in 2015, 388 in 2014, 329 in 2013, 354 in 2012
- The company has unprofitable business model: ROIC is at -6.9%
- It operates with high leverage: Net Debt/EBITDA is 7.3x while industry average is 4.3x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Trilogy Energy Corp ($TET) key annual financial indicators
| mln. CAD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 396.3 | 485.1 | 548.9 | 266.8 | 200.8 | -24.7% |
| Gross Profit | 278.5 | 103.8 | 172.8 | -38.2 | -32.2 | |
| SG&A | 11.5 | 10.0 | 11.2 | 14.5 | 12.4 | -14.6% |
| EBITDA | 227.3 | 299.5 | 310.1 | 20.9 | 77.3 | 268.9% |
| Net Income | -12.1 | 11.5 | -61.0 | -137.7 | -93.4 | |
Balance Sheet
|
|---|
| Cash | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
| Long Term Debt | 592.3 | 550.5 | 701.1 | 533.5 | 561.9 | 5.3% |
Cash flow
|
|---|
| Capex | 353.7 | 328.6 | 387.6 | 73.6 | 51.0 | -30.7% |
Ratios
|
|---|
| Revenue growth | 15.8% | 22.4% | 13.1% | -51.4% | -24.7% | |
| EBITDA growth | 8.2% | 31.8% | 3.5% | -93.2% | 268.9% | |
| Gross Margin | 70.3% | 21.4% | 31.5% | -14.3% | -16.0% | -1.7% |
| EBITDA Margin | 57.3% | 61.7% | 56.5% | 7.9% | 38.5% | 30.6% |
| Net Income Margin | -3.1% | 2.4% | -11.1% | -51.6% | -46.5% | 5.1% |
| SG&A, % of revenue | 2.9% | 2.1% | 2.0% | 5.4% | 6.2% | 0.7% |
| CAPEX, % of revenue | 89.2% | 67.7% | 70.6% | 27.6% | 25.4% | -2.2% |
| ROIC | 0.3% | 6.8% | 6.8% | -15.1% | -6.9% | 8.3% |
| ROE | -2.4% | 2.0% | -9.9% | -27.0% | -23.0% | 4.0% |
| Net Debt/EBITDA | 2.6x | 1.8x | 2.3x | 25.5x | 7.3x | -18.2x |
Trilogy Energy Corp ($TET) key quoterly financial indicators
| mln. CAD | 16Q1 | 16Q2 | 16Q3 | 16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 47 | 40 | 50 | 63 | -38.0% | -47.8% | -17.7% | 20.3% |
| EBITDA | 12 | 12 | 24 | 30 | -62.6% | -50.4% | | 35.6% |
| Net Income | -28 | -29 | -19 | -18 | | | | |
Balance Sheet
|
|---|
| Cash | 0 | 0 | 0 | 0 | | | | |
| Short Term Debt | 0 | 0 | 0 | 0 | | | | |
| Long Term Debt | 545 | 566 | 549 | 562 | -22.5% | -19.5% | -15.6% | 5.3% |
Ratios
|
|---|
| Gross Margin | -32.9% | -34.7% | -15.4% | 8.0% | -13.6% | -30.2% | -2.4% | 31.1% |
| EBITDA Margin | 26.3% | 28.7% | 47.1% | 47.0% | -17.3% | -1.5% | 140.4% | 5.3% |
| Net Income Margin | -58.8% | -71.9% | -36.9% | -28.8% | -31.4% | -37.2% | 78.7% | 7.9% |
Revenue and profitability
The company's Revenue dropped on 24.7%. Annual revenue decline showed slowdown in 16Q4 - revenue surged on 20.3%. Despite revenue decline the EBITDA margin expanded. EBITDA Margin jumped on 30.6 pp from 7.9% to 38.5% in 2016.
Gross Margin decreased slightly on 1.7 pp from -14.3% to -16.0% in 2016. SG&A as a % of Revenue increased slightly on 0.73 pp from 5.4% to 6.2% in 2016.
Net Income marign increased on 5.1 pp from -51.6% to -46.5% in 2016.
Capital expenditures (CAPEX) and working capital investments
In 2016 the company had CAPEX/Revenue of 25.4%. CAPEX/Revenue dropped on 42.3 pp from 67.7% in 2013 to 25.4% in 2016. It's average level of CAPEX/Revenue for the last three years was 41.2%.Battling declining revenue Trilogy Energy Corp invested a large share of EBITDA (66.0%) to CAPEX but that didn't help at least in this year.
Return on investment
The company operates at negative ROIC (-6.86%) and ROE (-23.02%). ROIC increased on 8.3 pp from -15.1% to -6.9% in 2016. ROE increased on 4.0 pp from -27.0% to -23.0% in 2016.
Leverage (Debt)
Debt level is 7.3x Net Debt / EBITDA and 7.3x Debt / EBITDA. Net Debt / EBITDA dropped on 18.2x from 25.5x to 7.3x in 2016. Debt increased on 5.3% while cash didn't change in 2016.
Management team
James H T Riddell "Jim" is a Trilogy Energy Corp's CEO. James H T Riddell "Jim" is a founder and has spent 13 years at the company. The company's CFO is Michael G Kohut "Mike". Michael G Kohut "Mike" has 12 years tenure at the company.
Appendix 1: Peers in Energy
Below we provide Trilogy Energy Corp benchmarking against other companies in Energy 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 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% |
| Painted Pony Petroleum Ltd ($PPY) | | 41.3% | 56.0% | -42.5% | 60.7% |
| ONEnergy Inc ($OEG) | | | 6,002.6% | 231.5% | 57.4% |
| |
|---|
| Median (116 companies) | | 15.4% | 17.0% | -27.7% | -18.0% |
|---|
| Trilogy Energy Corp ($TET) | | 22.4% | 13.1% | -51.4% | -24.7% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Americas Petrogas Inc ($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% | 32.2% | 32.4% | 33.9% | 32.5% |
|---|
| Trilogy Energy Corp ($TET) | 70.3% | 21.4% | 31.5% | -14.3% | -16.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Granite Oil Corp ($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) | 25.3% | 34.1% | 28.9% | 9.0% | 27.3% |
|---|
| Trilogy Energy Corp ($TET) | 57.3% | 61.7% | 56.5% | 7.9% | 38.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Oryx Petroleum Corp Ltd ($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% | 28.1% | 22.9% |
|---|
| Trilogy Energy Corp ($TET) | 89.2% | 67.7% | 70.6% | 27.6% | 25.4% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Enerplus Corp ($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% | 5.4% | 5.5% | -8.2% | -1.9% |
|---|
| Trilogy Energy Corp ($TET) | 0.3% | 6.8% | 6.8% | -15.1% | -6.9% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| BlackPearl Resources Inc ($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 ($TCW) | 2.5x | 3.4x | 2.9x | 31.4x | |
| TransCanada Corp ($TRP) | 5.5x | 5.7x | 5.7x | 22.1x | 9.6x |
| |
|---|
| Median (78 companies) | 1.5x | 1.4x | 1.4x | 2.6x | 2.6x |
|---|
| Trilogy Energy Corp ($TET) | 2.6x | 1.8x | 2.3x | 25.5x | 7.3x |
