Whitecap Resources Inc Net Income surged on 134% in 2016 and EBITDA Margin jumped on 38.1 pp from 69.7% to 108%
07.03.2017 • About Whitecap Resources Inc (
$WCP) • By InTwits
Whitecap Resources Inc reported 2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Whitecap Resources Inc has high CAPEX intensity: 5 year average CAPEX/Revenue was 124.7%. At the same time it's a lot of higher than industry average of 45.3%.
- CAPEX is quite volatile: 787 in 2016, 475 in 2015, 1,270 in 2014, 598 in 2013, 250 in 2012
- The company has business model with average profitability: ROIC is at 10.1%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Whitecap Resources Inc ($WCP) key annual financial indicators
| mln. CAD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 283.5 | 387.6 | 679.7 | 709.8 | 618.9 | -12.8% |
| Gross Profit | 111.0 | 163.3 | 291.8 | -262.1 | 153.3 | |
| SG&A | 9.2 | 12.1 | 17.7 | 21.5 | 21.7 | 0.8% |
| EBITDA | 186.6 | 278.0 | 492.7 | 495.0 | 667.1 | 34.8% |
| Net Income | 52.5 | 40.4 | 453.1 | -500.7 | 170.7 | |
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 | 310.7 | 382.9 | 756.6 | 876.2 | 773.4 | -11.7% |
Cash flow
|
|---|
| Capex | 250.0 | 597.5 | 1,270.3 | 475.1 | 787.4 | 65.7% |
Ratios
|
|---|
| Revenue growth | 129.4% | 36.7% | 75.4% | 4.4% | -12.8% | |
| EBITDA growth | 111.9% | 49.0% | 77.2% | 0.5% | 34.8% | |
| Gross Margin | 39.2% | 42.1% | 42.9% | -36.9% | 24.8% | 61.7% |
| EBITDA Margin | 65.8% | 71.7% | 72.5% | 69.7% | 107.8% | 38.1% |
| Net Income Margin | 18.5% | 10.4% | 66.7% | -70.5% | 27.6% | 98.1% |
| SG&A, % of revenue | 3.3% | 3.1% | 2.6% | 3.0% | 3.5% | 0.5% |
| CAPEX, % of revenue | 88.2% | 154.2% | 186.9% | 66.9% | 127.2% | 60.3% |
| ROIC | 7.1% | 8.1% | 9.6% | -10.6% | 10.1% | 20.7% |
| ROE | 8.1% | 3.7% | 23.8% | -19.9% | 6.1% | 25.9% |
| Net Debt/EBITDA | 1.7x | 1.4x | 1.5x | 1.8x | 1.2x | -0.6x |
Whitecap Resources Inc ($WCP) key quoterly financial indicators
| mln. CAD | 16Q1 | 16Q2 | 16Q3 | 16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 122 | 146 | 166 | 185 | 3.8% | -27.9% | -3.8% | -14.9% |
| EBITDA | 70 | 82 | 108 | 408 | 21.4% | -49.8% | -6.4% | 155.4% |
| Net Income | 2 | -28 | 6 | 191 | | | | |
Balance Sheet
|
|---|
| Cash | 0 | 0 | 0 | 0 | | | | |
| Short Term Debt | 0 | 0 | 0 | 0 | | | | |
| Long Term Debt | 755 | 834 | 795 | 773 | -5.9% | 13.8% | 1.5% | -11.7% |
Ratios
|
|---|
| Gross Margin | 8.9% | 28.0% | 26.8% | 31.0% | 3.2% | -12.5% | 276.7% | -6.3% |
| EBITDA Margin | 57.3% | 55.8% | 64.9% | 220.8% | 8.3% | -24.4% | -1.8% | 147.2% |
| Net Income Margin | 1.3% | -19.4% | 3.8% | 103.4% | 26.3% | -15.1% | 221.4% | 143.5% |
Revenue and profitability
Whitecap Resources Inc's Revenue dropped on 12.8%. Revenue decline showed acceleration in 16Q4 - it was 14.9% YoY. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin surged on 38.1 pp from 69.7% to 108% in 2016.
Gross Margin surged on 61.7 pp from -36.9% to 24.8% in 2016. SG&A as a % of Revenue showed almost no change in 2016.
Net Income marign surged on 98.1 pp from -70.5% to 27.6% in 2016.
Capital expenditures (CAPEX) and working capital investments
Whitecap Resources Inc's CAPEX/Revenue was 127% in 2016. Whitecap Resources Inc's CAPEX/Revenue dropped on 27.0 pp from 154% in 2013 to 127% in 2016. Average CAPEX/Revenue for the last three years was 127%.Battling declining revenue Whitecap Resources Inc made large investments to CAPEX (118% of EBITDA) but that didn't help at least in this year.
Return on investment
The company operates at low ROIC (10.07%) and ROE (6.06%). ROIC surged on 20.7 pp from -10.6% to 10.1% in 2016. ROE jumped on 25.9 pp from -19.9% to 6.1% in 2016.
Leverage (Debt)
Debt level is 1.2x Net Debt / EBITDA and 1.2x Debt / EBITDA. Net Debt / EBITDA dropped on 0.6x from 1.8x to 1.2x in 2016. Debt dropped on 11.7% while cash didn't change in 2016.
Appendix 1: Peers in Energy
Below you can find Whitecap Resources Inc benchmarking vs. other companies in Energy 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 |
|---|
| 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% | 16.9% | -29.5% | -19.1% |
|---|
| Whitecap Resources Inc ($WCP) | | 36.7% | 75.4% | 4.4% | -12.8% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Americas Petrogas Inc ($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% | 32.1% | 32.2% | 33.9% | 32.5% |
|---|
| Whitecap Resources Inc ($WCP) | 39.2% | 42.1% | 42.9% | -36.9% | 24.8% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Granite Oil Corp ($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% | 8.1% | 27.3% |
|---|
| Whitecap Resources Inc ($WCP) | 65.8% | 71.7% | 72.5% | 69.7% | 107.8% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Oryx Petroleum Corp Ltd ($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% | 27.6% | 22.9% |
|---|
| Whitecap Resources Inc ($WCP) | 88.2% | 154.2% | 186.9% | 66.9% | 127.2% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Enerplus Corp ($ERF) | -17.3% | 10.2% | 11.5% | -55.5% | 16.3% |
| 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 ($IPL) | 9.5% | 8.0% | 7.5% | 9.6% | 8.5% |
| Pembina Pipeline Corp ($PPL) | 8.2% | 8.5% | 7.6% | 6.3% | 6.9% |
| |
|---|
| Median (128 companies) | 3.6% | 5.4% | 5.5% | -8.2% | -1.9% |
|---|
| Whitecap Resources Inc ($WCP) | 7.1% | 8.1% | 9.6% | -10.6% | 10.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| BlackPearl Resources Inc ($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 ($TCW) | 2.5x | 3.4x | 2.9x | 31.4x | |
| Trilogy Energy Corp ($TET) | 2.6x | 1.8x | 2.3x | 25.5x | 7.3x |
| |
|---|
| Median (78 companies) | 1.5x | 1.5x | 1.4x | 2.7x | 2.7x |
|---|
| Whitecap Resources Inc ($WCP) | 1.7x | 1.4x | 1.5x | 1.8x | 1.2x |
