Ceres Global Ag Corp EBITDA jumped on 173% and Revenue jumped on 34.5%
23.09.2020 • About Ceres Global Ag Corp (
$CRP) • By InTwits
Ceres Global Ag Corp reported FY2020 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Ceres Global Ag Corp is a fast growth stock: FY2020 revenue growth was 34.5%, 5 year revenue CAGR was 32.3% at FY2020 ROIC 4.7%
- EBITDA Margin is expanding: 2.7% in FY2020 vs. 1.3% in FY2019 vs. -2.7% in FY2016
- EBITDA Margin is quite volatile: 2.7% in FY2020, 1.3% in FY2019, 1.1% in FY2018, 0.5% in FY2017, -2.7% in FY2016
- Ceres Global Ag Corp has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.8%. At the same time it's in pair with industry average of 5.6%
- CAPEX is quite volatile: 2 CADm in FY2020, 7 CADm in FY2019, 1 CADm in FY2018, 15 CADm in FY2017, 36 CADm in FY2016
- The company has potentially unprofitable business model: ROIC is 4.7%
- It operates with high leverage: Net Debt/EBITDA is 4.1x while industry average is 6.0x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue jumped on 34.5%. Revenue growth showed acceleration in FY20Q4 - it increased 34.7% YoY. Revenue growth happened at the same time with EBITDA margin expansion. EBITDA Margin increased slightly on 1.4 pp from 1.3% to 2.7% in FY2020. EBITDA Margin stuck to a growing trend at 1.2 pp per annum in the last 5 years.
Gross Margin increased slightly on 1.4 pp from 3.3% to 4.7% in FY2020. Gross Margin stuck to a growing trend at 1.3 pp per annum in FY2016-FY2020. SG&A as a % of Revenue showed almost no change in FY2020. During the last 5 years SG&A as a % of Revenue bottomed in FY2017 at 1.8% and was growing since that time.
Net Income margin increased on 4.6 pp from -3.8% to 0.75% in FY2020.
Investments (CAPEX, working capital and M&A)
Ceres Global Ag Corp's CAPEX/Revenue was 0.31% in FY2020. CAPEX/Revenue decreased slightly on 1.8 pp from 2.1% in FY2017 to 0.31% in FY2020. For the last three years the average CAPEX/Revenue was 0.62%.
Return on investment
The company operates at low ROIC (4.7%) and ROE (3.1%). ROIC increased on 6.5 pp from -1.7% to 4.7% in FY2020. ROE jumped on 17.0 pp from -13.9% to 3.1% in FY2020.
Leverage (Debt)
Company's Net Debt / EBITDA is 4.1x and Debt / EBITDA is 4.2x. Net Debt / EBITDA dropped on 4.6x from 8.7x to 4.1x in FY2020. Debt jumped on 25.7% while cash dropped on 61.7%.
Ceres Global Ag Corp has short term refinancing risk: cash is only 2.2% of short term debt.
Valuation and dividends
Ceres Global Ag Corp's trades at EV/EBITDA 8.9x and P/E 17.3x.
Financial and operational results
FY ended 30.06.2020
Ceres Global Ag Corp ($CRP) key annual financial indicators| mln. CAD | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 356.2 | 701.3 | 411.1 | 580.5 | 780.8 | 34.5% |
| Gross Profit | -3.1 | 10.4 | 11.7 | 19.0 | 36.7 | 93.4% |
| SG&A | 10.4 | 12.7 | 11.9 | 17.3 | 23.8 | 37.7% |
| EBITDA | -9.7 | 3.8 | 4.7 | 7.8 | 21.1 | 172.6% |
| Net Income | -13.9 | -18.1 | -0.6 | -22.3 | 5.8 | |
Balance Sheet
|
|---|
| Cash | 6.0 | 0.8 | 1.0 | 2.5 | 0.9 | -61.7% |
| Short Term Debt | 79.4 | 77.2 | 15.9 | 50.5 | 43.9 | -13.0% |
| Long Term Debt | 27.5 | 14.9 | 4.7 | 19.3 | 43.8 | 127.3% |
Cash flow
|
|---|
| Capex | 35.7 | 14.5 | 1.4 | 6.9 | 2.4 | -65.4% |
Ratios
|
|---|
| Revenue growth | 84.8% | 96.9% | -41.4% | 41.2% | 34.5% | |
| EBITDA growth | -353.0% | -139.1% | 24.4% | 64.1% | 172.6% | |
|
|---|
| Gross Margin | -0.9% | 1.5% | 2.8% | 3.3% | 4.7% | 1.4% |
| EBITDA Margin | -2.7% | 0.5% | 1.1% | 1.3% | 2.7% | 1.4% |
| SG&A, % of revenue | 2.9% | 1.8% | 2.9% | 3.0% | 3.0% | 0.1% |
| Net Income Margin | -3.9% | -2.6% | -0.1% | -3.8% | 0.7% | 4.6% |
| CAPEX, % of revenue | 10.0% | 2.1% | 0.3% | 1.2% | 0.3% | -0.9% |
|
|---|
| ROIC | -4.6% | -0.8% | -0.1% | -1.7% | 4.7% | 6.5% |
| ROE | -6.5% | -8.9% | -0.3% | -13.9% | 3.1% | 17.0% |
| Net Debt/EBITDA | | 24.0x | 4.1x | 8.7x | 4.1x | -4.6x |
Ceres Global Ag Corp ($CRP) key quoterly financial indicators
| mln. CAD | FY20Q1 | FY20Q2 | FY20Q3 | FY20Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 167 | 207 | 162 | 246 | | 41.7% | 27.6% | 34.6% | 34.7% |
| EBITDA | 6 | 8 | 2 | 6 | | 78.0% | 259.8% | 5.7% | 1,201.4% |
| Net Income | 2 | 3 | -0 | 1 | | - | - | - | - |
Balance Sheet
|
|---|
| Cash | 6 | 17 | 7 | 1 | | 143.9% | 938.8% | 115.7% | -61.7% |
| Short Term Debt | 55 | 85 | 85 | 44 | | -33.1% | 54.1% | 23.8% | -13.0% |
| Long Term Debt | 49 | 42 | 46 | 44 | | 705.0% | 109.0% | 132.5% | 127.3% |
Ratios
|
|---|
| Gross Margin | 5.1% | 5.9% | 3.5% | 4.2% | | -0.5% | 3.4% | -0.1% | 2.0% |
| EBITDA Margin | 3.4% | 3.6% | 1.4% | 2.3% | | 0.7% | 2.4% | -0.4% | 2.0% |
| Net Income Margin | 1.4% | 1.5% | -0.2% | 0.3% | | 10.8% | 5.7% | 1.1% | 2.3% |
Peers in Financial
Below you can find Ceres Global Ag Corp benchmarking vs. other companies in Financial industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by EBITDA margin, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Sunwah International Ltd ($SWH) | -92.8% | 19.1% | - | -175.7% | - |
| |
|---|
| Median (1 company) | 42.2% | 19.1% | - | -175.7% | - |
|---|
| Ceres Global Ag Corp ($CRP) | -2.7% | 0.5% | 1.1% | 1.3% | 2.7% |
Top companies by CAPEX/Revenue, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Sunwah International Ltd ($SWH) | 9.4% | 0.2% | - | 3.5% | - |
| |
|---|
| Median (1 company) | 0.9% | 0.2% | - | 3.5% | - |
|---|
| Ceres Global Ag Corp ($CRP) | 10.0% | 2.1% | 0.3% | 1.2% | 0.3% |
Top companies by ROIC, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Sunwah International Ltd ($SWH) | - | -0.9% | -1.2% | -7.2% | - |
| Venerable Ventures Ltd ($VLV) | -4.6% | -4.5% | -12.0% | -12.6% | -225.0% |
| |
|---|
| Median (2 companies) | 3.0% | -2.7% | -6.6% | -9.9% | -225.0% |
|---|
| Ceres Global Ag Corp ($CRP) | -4.6% | -0.8% | -0.1% | -1.7% | 4.7% |
