North Mining Shares Co Ltd revenue dropped on 45.9% in 2015 and EBITDA Margin dropped on 268 pp from -7.7% to -276%
17/03/2016 • About North Mining Shares Co Ltd (
$433) • By InTwits
North Mining Shares Co Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- North Mining Shares Co Ltd is a company in decline: 2015 revenue growth was -45.9%, 5 years revenue CAGR was -8.5%
- The company operates at negative EBITDA Margin: -275.7%
- North Mining Shares Co Ltd spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for 2011-2015 is 0.0%. Average EBITDA Margin for the same period was -127.2%0
- North Mining Shares Co Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 41.5%. At the same time it's a lot of higher than industry average of 21.8%.
- CAPEX is quite volatile: 238 in 2015, 268 in 2014, 20.5 in 2013, 80.2 in 2012, 67.7 in 2011
- The company has unprofitable business model: ROIC is at -18.4%
- It operates with high leverage: Net Debt/EBITDA is 15.7x while industry average is 2.3x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
North Mining Shares Co Ltd ($433) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 391.0 | 369.7 | 158.5 | 454.9 | 246.0 | -45.9% |
| Gross Profit | 121.8 | 28.7 | 22.2 | 55.8 | 20.2 | -63.8% |
| SG&A | 81.1 | 85.9 | 77.5 | 66.6 | 101.4 | 52.2% |
| EBITDA | -685.6 | -923.9 | 262.3 | -35.2 | -678.2 | 1,828.8% |
| Net Income | -487.5 | -852.5 | 194.0 | -165.2 | -436.2 | 164.1% |
Balance Sheet
|
|---|
| Cash | 24.3 | 368.5 | 44.9 | 102.2 | 225.4 | 120.4% |
| Short Term Debt | 59.9 | 94.6 | 231.5 | 171.2 | 100.9 | -41.1% |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 67.7 | 80.2 | 20.5 | 267.8 | 237.8 | -11.2% |
Ratios
|
|---|
| Revenue growth | 1.7% | -5.5% | -57.1% | 187.0% | -45.9% | |
| EBITDA growth | -18.6% | 34.8% | -128.4% | -113.4% | 1,828.8% | |
| Gross Margin | 31.1% | 7.8% | 14.0% | 12.3% | 8.2% | -4.1% |
| EBITDA Margin | -175.3% | -249.9% | 165.5% | -7.7% | -275.7% | -268.0% |
| Net Income Margin | -124.7% | -230.6% | 122.4% | -36.3% | -177.3% | -141.0% |
| SG&A, % of revenue | 20.7% | 23.2% | 48.9% | 14.6% | 41.2% | 26.6% |
| CAPEX, % of revenue | 17.3% | 21.7% | 13.0% | 58.9% | 96.7% | 37.8% |
| ROIC | -13.0% | -21.6% | 3.4% | -5.0% | -18.4% | -13.4% |
| ROE | -14.0% | -28.3% | 6.5% | -4.7% | -11.7% | -7.0% |
| Net Debt/EBITDA | | | 0.7x | | | 0.0x |
Revenue and profitability
The company's Revenue dropped on 45.9% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 7.1 pp from -14.1% to -6.9% in FY2015.
Gross Margin decreased on 4.1 pp from 12.3% to 8.2% in 2015. SG&A as a % of Revenue jumped on 26.6 pp from 14.6% to 41.2% in 2015.
Net Income marign dropped on 141 pp from -36.3% to -177% in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 96.7% in 2015. CAPEX/Revenue surged on 75.0 pp from 21.7% in 2012 to 96.7% in 2015. Average CAPEX/Revenue for the last three years was 56.2%.
Return on investment
The company operates at negative ROIC (-18.39%) and ROE (-11.70%). ROIC dropped on 13.4 pp from -5.0% to -18.4% in 2015. ROE decreased on 7.0 pp from -4.7% to -11.7% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 15.7x and Debt / EBITDA is . Net Debt / EBITDA didn't change in 2015. Debt dropped on 41.1% in 2015 while cash surged on 120% in 2015.
Appendix 1: Peers in Mining
Below you can find North Mining Shares Co Ltd benchmarking vs. other companies in Mining 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 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Xinjiang Xinxin Mining Industry Co Ltd ($3833) | 24.0% | 4.8% | -44.7% | 303.0% | |
| Huili Resources Group Ltd ($1303) | -47.8% | -33.6% | -91.6% | 219.4% | |
| China Kingstone Mining Holdings Ltd ($1380) | 4,275.3% | -94.5% | -55.6% | 155.2% | |
| Ding He Mining Holdings Ltd ($705) | 31.6% | 29.9% | 43.8% | 89.8% | |
| China Billion Resources Ltd ($274) | -47.2% | -78.6% | -19.2% | 44.8% | |
| |
|---|
| Median (47 companies) | 36.5% | 5.4% | 2.4% | -6.5% | -7.5% |
|---|
| North Mining Shares Co Ltd ($433) | | -5.5% | -57.1% | 187.0% | -45.9% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Billion Resources Ltd ($274) | 20.3% | 71.4% | 47.2% | 73.4% | |
| Sun International Resources Ltd ($8029) | 77.6% | 83.2% | 73.1% | 64.8% | 69.4% |
| China Polymetallic Mining Ltd ($2133) | 76.9% | 81.8% | 74.2% | 51.8% | 38.9% |
| China Precious Metal Resources Holdings Co Ltd ($1194) | 64.7% | 63.9% | 54.9% | 51.2% | |
| Hengshi Mining Investments Ltd ($1370) | 54.6% | 32.4% | 55.3% | 50.1% | |
| |
|---|
| Median (47 companies) | 19.1% | 14.4% | 14.7% | 15.6% | 26.9% |
|---|
| North Mining Shares Co Ltd ($433) | 31.1% | 7.8% | 14.0% | 12.3% | 8.2% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Precious Metal Resources Holdings Co Ltd ($1194) | 73.1% | 70.0% | 64.6% | 59.6% | |
| China Polymetallic Mining Ltd ($2133) | -322.0% | 62.8% | 58.5% | 54.1% | 2.8% |
| G-Resources Group Ltd ($1051) | | | 54.5% | 53.4% | |
| China Gold International Resources Corp Ltd ($2099) | | 41.7% | 38.3% | 47.3% | 33.7% |
| Hengshi Mining Investments Ltd ($1370) | 45.7% | 22.8% | 52.0% | 45.4% | |
| |
|---|
| Median (47 companies) | 7.0% | 4.9% | 7.5% | 4.9% | 8.7% |
|---|
| North Mining Shares Co Ltd ($433) | -175.3% | -249.9% | 165.5% | -7.7% | -275.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Mongolia Energy Corp Ltd ($276) | | 8,006.5% | 1,061.7% | 30,555.4% | 1,973.0% |
| Huili Resources Group Ltd ($1303) | 3.9% | 181.0% | 1,508.6% | 279.5% | |
| Kaz Minerals ($847) | 19.8% | 36.6% | 136.5% | 168.8% | 168.7% |
| China Gold International Resources Corp Ltd ($2099) | | 64.7% | 156.1% | 95.6% | 81.4% |
| IRC Ltd ($1029) | 129.7% | 102.1% | 70.6% | 82.5% | |
| |
|---|
| Median (47 companies) | 14.3% | 17.0% | 16.0% | 11.1% | 11.0% |
|---|
| North Mining Shares Co Ltd ($433) | 17.3% | 21.7% | 13.0% | 58.9% | 96.7% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Silver Group Ltd ($815) | 48.0% | 57.6% | 31.6% | 35.8% | |
| Hengshi Mining Investments Ltd ($1370) | 153.0% | 50.1% | 60.1% | 20.7% | |
| China Hongqiao Group Ltd ($1378) | 44.6% | 24.8% | 17.0% | 14.1% | 10.6% |
| China Nonferrous Mining Corp Ltd ($1258) | 10.9% | 14.7% | 10.8% | 11.8% | |
| Xingfa Aluminium Holdings Ltd ($98) | 3.8% | 7.6% | 8.8% | 11.7% | |
| |
|---|
| Median (48 companies) | 3.7% | 2.2% | 3.0% | 1.7% | -0.1% |
|---|
| North Mining Shares Co Ltd ($433) | -13.0% | -21.6% | 3.4% | -5.0% | -18.4% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Xinjiang Xinxin Mining Industry Co Ltd ($3833) | 0.9x | 8.4x | 39.4x | 10.3x | |
| MMG Ltd ($1208) | -0.0x | 2.1x | 2.0x | 10.2x | 20.2x |
| China Daye Non-Ferrous Metals Mining Ltd ($661) | 5.8x | 9.2x | 9.7x | 9.2x | |
| Midas Holdings Ltd ($1021) | 1.4x | 4.3x | 6.5x | 8.7x | 8.0x |
| Lingbao Gold Co Ltd ($3330) | 3.5x | 5.3x | | 8.3x | |
| |
|---|
| Median (27 companies) | 1.1x | 1.8x | 2.0x | 4.4x | 4.5x |
|---|
