Petro-King Oilfield Services Ltd reports 85.4% CAPEX decline and 10.5% Revenue decline
24/03/2016 • About Petro-King Oilfield Services Ltd (
$2178) • By InTwits
Petro-King Oilfield Services Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Petro-King Oilfield Services Ltd doesn't have a profitable business model yet: 2015 ROIC is -6.6%
- The company operates at negative EBITDA Margin: -13.3%
- EBITDA Margin is quite volatile: -13.3% in 2015, -47.9% in 2014, 26.5% in 2013, 19.0% in 2012, 29.7% in 2011
- Petro-King Oilfield Services Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 24.5%. At the same time it's a lot of higher than industry average of 11.0%.
- CAPEX is quite volatile: 77.7 in 2015, 532 in 2014, 141 in 2013, 141 in 2012, 13.5 in 2011
- The company has unprofitable business model: ROIC is at -6.6%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Petro-King Oilfield Services Ltd ($2178) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 164 | 1,057 | 1,060 | 705 | 631 | -10.5% |
| SG&A | 3 | 23 | 47 | 50 | 30 | -39.3% |
| EBITDA | 49 | 201 | 281 | -338 | -84 | -75.1% |
| Net Income | 87 | 178 | 197 | -423 | -384 | -9.2% |
Balance Sheet
|
|---|
| Cash | 73 | 137 | 344 | 55 | 47 | -15.8% |
| Short Term Debt | 103 | 199 | 233 | 713 | 209 | -70.6% |
| Long Term Debt | 0 | 0 | 0 | 37 | 175 | 375.1% |
Cash flow
|
|---|
| Capex | 13 | 141 | 141 | 532 | 78 | -85.4% |
Ratios
|
|---|
| Revenue growth | -70.6% | 543.3% | 0.3% | -33.5% | -10.5% | |
| EBITDA growth | -56.7% | 311.1% | 39.7% | -220.3% | -75.1% | |
| EBITDA Margin | 29.7% | 19.0% | 26.5% | -47.9% | -13.3% | 34.6% |
| Net Income Margin | 52.8% | 16.9% | 18.5% | -60.0% | -60.9% | -0.9% |
| SG&A, % of revenue | 1.7% | 2.2% | 4.5% | 7.1% | 4.8% | -2.3% |
| CAPEX, % of revenue | 8.2% | 13.3% | 13.3% | 75.4% | 12.3% | -63.1% |
| ROIC | 3.2% | 14.7% | 13.2% | -14.9% | -6.6% | 8.4% |
| ROE | 9.3% | 17.5% | 12.1% | -21.5% | -23.1% | -1.6% |
| Net Debt/EBITDA | 0.6x | 0.3x | -0.4x | | | 0.0x |
Revenue and profitability
Petro-King Oilfield Services Ltd's Revenue dropped on 10.5% in 2015. Revenue decline happened at the same time with EBITDA margin expansion. EBITDA Margin jumped on 34.6 pp from -47.9% to -13.3% in 2015.
SG&A as a % of Revenue decreased on 2.3 pp from 7.1% to 4.8% in 2015.
Net Income marign decreased slightly on 0.91 pp from -60.0% to -60.9% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 12.3%. CAPEX/Revenue decreased slightly on 0.97 pp from 13.3% in 2012 to 12.3% in 2015. It's average level of CAPEX/Revenue for the last three years was 33.7%.
Return on investment
The company operates at negative ROIC (-6.57%) and ROE (-23.09%). ROIC increased on 8.4 pp from -14.9% to -6.6% in 2015. ROE decreased slightly on 1.6 pp from -21.5% to -23.1% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is -1.1x and Debt / EBITDA is . Net Debt / EBITDA didn't change in 2015. Debt dropped on 48.7% in 2015 while cash dropped on 15.8% in 2015.
Appendix 1: Peers in Oil&Gas Services
Below you can find Petro-King Oilfield Services Ltd benchmarking vs. other companies in Oil&Gas Services 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 |
|---|
| Yuan Heng Gas Holdings Ltd ($332) | | 196.3% | 207.4% | 105.9% | -36.4% |
| CIMC Enric Holdings Ltd ($3899) | | 18.4% | -0.3% | 39.7% | -26.9% |
| TSC Group Holdings Ltd ($206) | -2.8% | 31.7% | 9.9% | 34.0% | |
| China Oilfield Services Ltd ($2883) | 4.9% | 20.0% | 23.8% | 20.6% | |
| Sinopec Engineering Group Co Ltd ($2386) | | 25.9% | 13.1% | 13.3% | -7.8% |
| |
|---|
| Median (12 companies) | 15.3% | 24.7% | 11.5% | 6.0% | -26.9% |
|---|
| Petro-King Oilfield Services Ltd ($2178) | | 543.3% | 0.3% | -33.5% | -10.5% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Hilong Holding Ltd ($1623) | 41.0% | 39.5% | 40.3% | 39.6% | 32.6% |
| Anton Oilfield Services Group/Hong Kong ($3337) | 41.5% | 45.0% | 44.3% | 31.2% | |
| TSC Group Holdings Ltd ($206) | 38.0% | 30.7% | 31.6% | 27.8% | |
| Jutal Offshore Oil Services Ltd ($3303) | 20.3% | 21.7% | 25.1% | 19.6% | |
| CIMC Enric Holdings Ltd ($3899) | 18.7% | 19.5% | 20.4% | 18.8% | 18.6% |
| |
|---|
| Median (10 companies) | 19.5% | 16.9% | 17.6% | 15.8% | 16.1% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Hans Energy Co Ltd ($554) | -38.3% | 40.4% | 45.0% | 42.8% | 42.7% |
| China Oilfield Services Ltd ($2883) | 43.7% | 39.8% | 40.0% | 37.0% | |
| Hilong Holding Ltd ($1623) | 28.5% | 25.9% | 27.8% | 28.8% | 22.7% |
| SPT Energy Group Inc ($1251) | 24.7% | 23.8% | 19.8% | 14.1% | -36.0% |
| TSC Group Holdings Ltd ($206) | 11.7% | 11.4% | 14.0% | 13.2% | |
| |
|---|
| Median (12 companies) | 12.0% | 12.4% | 14.0% | 12.5% | 10.6% |
|---|
| Petro-King Oilfield Services Ltd ($2178) | 29.7% | 19.0% | 26.5% | -47.9% | -13.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Hilong Holding Ltd ($1623) | 17.1% | 16.7% | 18.9% | 48.1% | 9.6% |
| China Oilfield Services Ltd ($2883) | 24.9% | 16.5% | 30.9% | 29.8% | |
| Anton Oilfield Services Group/Hong Kong ($3337) | 13.3% | 12.6% | 32.2% | 22.8% | |
| Jutal Offshore Oil Services Ltd ($3303) | 6.6% | 12.8% | 8.4% | 12.9% | |
| SPT Energy Group Inc ($1251) | 6.8% | 7.4% | 5.6% | 7.9% | 23.5% |
| |
|---|
| Median (12 companies) | 6.7% | 6.4% | 5.2% | 6.3% | 4.8% |
|---|
| Petro-King Oilfield Services Ltd ($2178) | 8.2% | 13.3% | 13.3% | 75.4% | 12.3% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Yuan Heng Gas Holdings Ltd ($332) | | -59.8% | -0.0% | 25.6% | 3.9% |
| CIMC Enric Holdings Ltd ($3899) | 19.4% | 20.3% | 20.0% | 21.3% | 8.9% |
| Sinopec Engineering Group Co Ltd ($2386) | 59.6% | 77.5% | 33.3% | 18.6% | 15.3% |
| Hilong Holding Ltd ($1623) | 19.0% | 15.5% | 14.8% | 12.0% | 6.0% |
| China Oilfield Services Ltd ($2883) | 8.6% | 8.9% | 11.2% | 11.6% | |
| |
|---|
| Median (12 companies) | 8.6% | 7.8% | 10.1% | 10.2% | 5.0% |
|---|
| Petro-King Oilfield Services Ltd ($2178) | 3.2% | 14.7% | 13.2% | -14.9% | -6.6% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Hans Energy Co Ltd ($554) | | 14.0x | 11.9x | 12.9x | 11.3x |
| Anton Oilfield Services Group/Hong Kong ($3337) | -0.5x | 0.0x | 0.9x | 7.4x | |
| Yuan Heng Gas Holdings Ltd ($332) | | | | 2.7x | 8.9x |
| Hilong Holding Ltd ($1623) | 0.8x | 0.9x | 1.1x | 2.6x | 3.3x |
| Sinopec Kantons Holdings Ltd ($934) | -1.2x | -7.1x | -7.4x | 2.5x | 2.2x |
| |
|---|
| Median (12 companies) | -0.3x | 0.0x | -0.0x | 1.8x | 2.8x |
|---|
