SEMAFO Inc reports 37.4% Net Income growth and almost no change in Revenue of 300
08.03.2017 • About SEMAFO Inc (
$SMF) • By InTwits
SEMAFO Inc reported 2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- SEMAFO Inc has high CAPEX intensity: 5 year average CAPEX/Revenue was 36.4%. At the same time it's a lot of higher than industry average of 24.1%.
- CAPEX is quite volatile: 12.1 in FY2016, 14.8 in FY2015, 22.6 in FY2014, 69.0 in FY2013, 81.1 in FY2012
- The company has business model with low profitability: ROIC is at 7.7%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
SEMAFO Inc ($SMF) key annual financial indicators
| mln. $ | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 287.2 | 226.6 | 289.3 | 300.1 | 300.5 | 0.1% |
| SG&A | 22.3 | 19.6 | 17.4 | 13.6 | 14.0 | 2.9% |
| EBITDA | 112.5 | 77.1 | 118.6 | 153.8 | 138.4 | -10.0% |
| Net Income | -14.8 | -85.2 | 4.5 | 24.9 | 34.2 | 37.4% |
Balance Sheet
|
|---|
| Cash | 139.5 | 82.2 | 127.9 | 167.2 | 273.8 | 63.8% |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 29.1 | 0.3 | -98.9% |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 59.4 | 56.7 | -4.5% |
Cash flow
|
|---|
| Capex | 152.8 | 109.1 | 68.6 | 79.4 | 90.9 | 14.4% |
Ratios
|
|---|
| Revenue growth | -27.5% | -21.1% | 27.7% | 3.7% | 0.1% | |
| EBITDA growth | -42.4% | -31.5% | 53.9% | 29.7% | -10.0% | |
| EBITDA Margin | 39.2% | 34.0% | 41.0% | 51.2% | 46.1% | -5.2% |
| Net Income Margin | -5.2% | -37.6% | 1.5% | 8.3% | 11.4% | 3.1% |
| SG&A, % of revenue | 7.8% | 8.6% | 6.0% | 4.5% | 4.6% | 0.1% |
| CAPEX, % of revenue | 53.2% | 48.2% | 23.7% | 26.5% | 30.2% | 3.8% |
| ROIC | 10.7% | 3.4% | 8.8% | 10.4% | 7.7% | -2.6% |
| ROE | -2.5% | -15.9% | 0.9% | 4.6% | 5.3% | 0.7% |
| Net Debt/EBITDA | -1.2x | -1.1x | -1.1x | -0.5x | -1.6x | -1.1x |
SEMAFO Inc ($SMF) key quoterly financial indicators
| mln. $ | 16Q1 | 16Q2 | 16Q3 | 16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 75 | 77 | 80 | 69 | 0.7% | -5.6% | 10.6% | -4.6% |
| EBITDA | 35 | 35 | 43 | 26 | -0.4% | -23.3% | 10.6% | -25.5% |
| Net Income | 16 | 5 | 18 | -5 | | -73.1% | 37.8% | -1,139.7% |
Balance Sheet
|
|---|
| Cash | 167 | 254 | 282 | 274 | 45.1% | 94.1% | 104.8% | 63.8% |
| Short Term Debt | 0 | 0 | 0 | 0 | -100.0% | -99.0% | -98.9% | -98.9% |
| Long Term Debt | 59 | 59 | 57 | 57 | 0.0% | 0.8% | -4.5% | -4.5% |
Ratios
|
|---|
| EBITDA Margin | 47.2% | 45.2% | 53.5% | 37.2% | -0.5% | -10.4% | 0.0% | -10.4% |
| Net Income Margin | 21.7% | 6.9% | 22.0% | -7.2% | 32.7% | -17.4% | 4.4% | -7.8% |
Revenue and profitability
SEMAFO Inc's Revenue showed almost no change in 2016. Revenue growth showed slow down in 16Q4 - it was -4.6% YoY. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 6.1 pp from -1.9% to -7.9% in FY2016.
SG&A as a % of Revenue showed almost no change in 2016.
Net Income marign increased on 3.1 pp from 8.3% to 11.4% in 2016.
Capital expenditures (CAPEX) and working capital investments
In 2016 the company had CAPEX/Revenue of 30.2%. CAPEX/Revenue dropped on 17.9 pp from 48.2% in 2013 to 30.2% in 2016. For the last three years the average CAPEX/Revenue was 26.8%.SEMAFO Inc maintained rich investment policy and has spent a big chunk of EBITDA (65.7%) to CAPEX.
Return on investment
The company operates at low ROIC (7.72%) and ROE (5.33%). ROIC decreased on 2.6 pp from 10.4% to 7.7% in 2016. ROE increased slightly on 0.72 pp from 4.6% to 5.3% in 2016.
Leverage (Debt)
Company's Net Debt / EBITDA is -1.6x and Debt / EBITDA is 0.4x. Net Debt / EBITDA dropped on 1.1x from -0.5x to -1.6x in 2016. Debt dropped on 35.5% while cash jumped on 63.8%.
Management team
The company's CEO is Benoit Desormeaux. Benoit Desormeaux is a founder and has 6 years tenure at the company. The company's CFO is Martin Milette. Martin Milette has 12 years tenure at the company.
Appendix 1: Peers in Basic Materials
Below you can find SEMAFO Inc 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 ($OR) | | | | 164.4% | 38.0% |
| |
|---|
| Median (82 companies) | 100.8% | -2.5% | 1.8% | -2.9% | 6.8% |
|---|
| SEMAFO Inc ($SMF) | | -21.1% | 27.7% | 3.7% | 0.1% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Nevsun Resources Ltd ($NSU) | 89.9% | 94.8% | 95.5% | 82.3% | 79.7% |
| Labrador Iron Ore Royalty Corp ($LIF) | 80.2% | 80.2% | 80.2% | 80.3% | 80.3% |
| 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 ($PRU) | 52.5% | 50.9% | 32.0% | 53.7% | 26.3% |
| |
|---|
| Median (95 companies) | 32.1% | 22.4% | 18.6% | 16.5% | 24.8% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Labrador Iron Ore Royalty Corp ($LIF) | | | | 72.8% | 73.5% |
| 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% |
| |
|---|
| Median (100 companies) | 17.4% | 10.8% | 10.3% | 6.7% | 23.0% |
|---|
| SEMAFO Inc ($SMF) | 39.2% | 34.0% | 41.0% | 51.2% | 46.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Largo Resources Ltd ($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) | 27.4% | 26.5% | 17.5% | 16.6% | 17.5% |
|---|
| SEMAFO Inc ($SMF) | 53.2% | 48.2% | 23.7% | 26.5% | 30.2% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Lucara Diamond Corp ($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% |
|---|
| SEMAFO Inc ($SMF) | 10.7% | 3.4% | 8.8% | 10.4% | 7.7% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Canam Group Inc ($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 | 0.9x | 1.2x | 1.6x | 0.7x |
|---|
| SEMAFO Inc ($SMF) | -1.2x | -1.1x | -1.1x | -0.5x | -1.6x |
