PetroChina Co Ltd reports 29.0% CAPEX decline and 24.4% Revenue decline
23/03/2016 • About PetroChina Co Ltd (
$857) • By InTwits
PetroChina Co Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is relatively stable: 16.3% in 2015 vs. 15.2% in 2014 vs. 16.0% in 2011
- PetroChina Co Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 13.4%. At the same time it's in pair with industry average of 13.0%.
- CAPEX is quite volatile: 8.4 in 2015, 2.8 in 2014, 11.8 in 2013, 97.4 in 2012, 283 in 2011
- The company has potentially unprofitable business model: ROIC is at 4.2%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
PetroChina Co Ltd ($857) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 2,003,843 | 2,195,296 | 2,258,124 | 2,282,962 | 1,725,428 | -24.4% |
| SG&A | 69,969 | 74,692 | 79,021 | 73,413 | 71,270 | -2.9% |
| EBITDA | 320,321 | 326,155 | 351,649 | 347,021 | 281,839 | -18.8% |
| Net Income | 132,961 | 115,326 | 129,599 | 107,172 | 35,517 | -66.9% |
Balance Sheet
|
|---|
| Cash | 61,172 | 43,395 | 51,407 | 73,778 | 72,773 | -1.4% |
| Short Term Debt | 137,327 | 151,052 | 192,586 | 167,783 | 106,027 | -36.8% |
| Long Term Debt | 180,675 | 293,774 | 302,862 | 370,301 | 434,475 | 17.3% |
Cash flow
|
|---|
| Capex | 267,975 | 311,744 | 304,100 | 306,551 | 217,750 | -29.0% |
Ratios
|
|---|
| Revenue growth | 36.7% | 9.6% | 2.9% | 1.1% | -24.4% | |
| EBITDA growth | 6.5% | 1.8% | 7.8% | -1.3% | -18.8% | |
| EBITDA Margin | 16.0% | 14.9% | 15.6% | 15.2% | 16.3% | 1.1% |
| Net Income Margin | 6.6% | 5.3% | 5.7% | 4.7% | 2.1% | -2.6% |
| SG&A, % of revenue | 3.5% | 3.4% | 3.5% | 3.2% | 4.1% | 0.9% |
| CAPEX, % of revenue | 13.4% | 14.2% | 13.5% | 13.4% | 12.6% | -0.8% |
| ROIC | 13.4% | 11.2% | 10.9% | 9.3% | 4.2% | -5.1% |
| ROE | 13.7% | 11.2% | 11.8% | 9.3% | 3.0% | -6.3% |
| Net Debt/EBITDA | 0.8x | 1.2x | 1.3x | 1.3x | 1.7x | 0.3x |
Revenue and profitability
The company's Revenue dropped on 24.4% in 2015. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased slightly on 1.1 pp from 15.2% to 16.3% in 2015.
SG&A as a % of Revenue increased slightly on 0.91 pp from 3.2% to 4.1% in 2015.
Net Income marign decreased on 2.6 pp from 4.7% to 2.1% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 12.6%. The company showed small CAPEX/Revenue decline of 1.6 pp from 14.2% in 2012 to 12.6% in 2015. It's average CAPEX/Revenue for the last three years was 13.2%.The company invested a big chunk of EBITDA (77.3%) to CAPEX which didn't stop revenue from falling.
Return on investment
The company operates at low ROIC (4.21%) and ROE (3.02%). ROIC decreased on 5.1 pp from 9.3% to 4.2% in 2015. ROE decreased on 6.3 pp from 9.3% to 3.0% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 1.7x and Debt / EBITDA is 1.9x. Net Debt / EBITDA surged on 0.3x from 1.3x to 1.7x in 2015. Debt showed almost no change in 2015 while cash decreased slightly on 1.4% in 2015.
Management team
Wang Dongjin is a PetroChina Co Ltd's CEO. Wang Dongjin has spent 3 years at the company.
Appendix 1: Peers in Oil&Gas
Below we provide PetroChina Co Ltd benchmarking against other companies in Oil&Gas 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 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China CBM Group Co Ltd ($8270) | 9.9% | -27.6% | 1.8% | 60.9% | |
| Brightoil Petroleum Holdings Ltd ($933) | | 76.9% | -20.8% | 52.5% | -12.3% |
| United Energy Group Ltd ($467) | | 266.5% | 49.0% | 27.8% | -11.5% |
| Yanchang Petroleum International Ltd ($346) | -1.8% | 641.9% | 155.6% | 15.5% | |
| Kunlun Energy Co Ltd ($135) | | 27.2% | 31.8% | 10.6% | -13.3% |
| |
|---|
| Median (17 companies) | 25.1% | 15.7% | 8.7% | -3.9% | -12.8% |
|---|
| PetroChina Co Ltd ($857) | | 9.6% | 2.9% | 1.1% | -24.4% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| EPI Holdings Ltd ($689) | 0.3% | 58.0% | 50.7% | 54.6% | |
| United Energy Group Ltd ($467) | 15.4% | 39.4% | 48.0% | 53.8% | 51.5% |
| Enviro Energy International Holdings Ltd ($1102) | 25.0% | 49.3% | 76.9% | 38.6% | 3.4% |
| South Sea Petroleum Holdings Ltd ($76) | 48.2% | 27.3% | 25.3% | 38.5% | |
| Zhongyu Gas Holdings Ltd ($3633) | 23.9% | 23.6% | 23.8% | 24.9% | |
| |
|---|
| Median (12 companies) | 6.3% | 8.8% | 5.4% | 9.7% | 3.4% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| United Energy Group Ltd ($467) | 100.6% | 71.2% | 65.3% | 69.8% | -31.9% |
| MIE Holdings Corp ($1555) | 58.1% | 57.0% | 54.5% | 57.1% | |
| CNOOC Ltd ($883) | 50.3% | 48.5% | 47.2% | 50.7% | |
| Sino Oil And Gas Holdings Ltd ($702) | -273.6% | -170.8% | -132.3% | 49.6% | |
| Kunlun Energy Co Ltd ($135) | 46.8% | 47.0% | 39.5% | 34.9% | 30.9% |
| |
|---|
| Median (17 companies) | 4.0% | 3.7% | 1.4% | 5.9% | -3.3% |
|---|
| PetroChina Co Ltd ($857) | 16.0% | 14.9% | 15.6% | 15.2% | 16.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Enviro Energy International Holdings Ltd ($1102) | 1,208.5% | 301.4% | 46.5% | 111.0% | 7.9% |
| MIE Holdings Corp ($1555) | 43.9% | 52.2% | 43.3% | 44.1% | |
| United Energy Group Ltd ($467) | 60.0% | 37.2% | 62.7% | 42.4% | 49.1% |
| CNOOC Ltd ($883) | 21.9% | 25.4% | 30.3% | 34.8% | |
| China CBM Group Co Ltd ($8270) | 52.3% | 58.1% | 81.7% | 22.5% | |
| |
|---|
| Median (17 companies) | 27.7% | 13.4% | 6.7% | 4.5% | 5.4% |
|---|
| PetroChina Co Ltd ($857) | 13.4% | 14.2% | 13.5% | 13.4% | 12.6% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| CNOOC Ltd ($883) | 32.4% | 25.7% | 18.1% | 15.8% | |
| United Energy Group Ltd ($467) | 3.6% | 7.4% | 10.3% | 15.7% | -25.0% |
| Shanghai Tonva Petrochemical Co Ltd ($1103) | 5.4% | 7.3% | 12.6% | 13.0% | |
| Zhongyu Gas Holdings Ltd ($3633) | 10.6% | 17.4% | 15.0% | 12.3% | |
| Kunlun Energy Co Ltd ($135) | 12.3% | 13.0% | 12.6% | 11.0% | 7.7% |
| |
|---|
| Median (19 companies) | 3.6% | 3.8% | 1.6% | 1.5% | -4.4% |
|---|
| PetroChina Co Ltd ($857) | 13.4% | 11.2% | 10.9% | 9.3% | 4.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Titan Petrochemicals Group Ltd ($1192) | | | | 95.2x | |
| Sino Oil And Gas Holdings Ltd ($702) | | | | 55.5x | |
| Zhongyu Gas Holdings Ltd ($3633) | 2.0x | 1.6x | 2.3x | 3.7x | |
| Shanghai Tonva Petrochemical Co Ltd ($1103) | 8.3x | 6.0x | 4.3x | 3.6x | |
| China CBM Group Co Ltd ($8270) | 1.3x | 3.2x | | 3.3x | |
| |
|---|
| Median (12 companies) | 1.3x | 1.6x | 1.0x | 2.7x | 0.9x |
|---|
| PetroChina Co Ltd ($857) | 0.8x | 1.2x | 1.3x | 1.3x | 1.7x |
