Mongolian Mining Corp revenue dropped on 69.7% in 2015 and EBITDA Margin dropped on 52.1 pp from -14.6% to -66.7%
28/03/2016 • About Mongolian Mining Corp (
$975) • By InTwits
Mongolian Mining Corp reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Mongolian Mining Corp is a company in decline: 2015 revenue growth was -69.7%, 5 years revenue CAGR was -18.5%
- The company operates at negative EBITDA Margin: -66.7%
- Mongolian Mining Corp has high CAPEX intensity: 5 year average CAPEX/Revenue was 43.8%. At the same time it's in pair with industry average of 44.0%.
- CAPEX is quite volatile: 42.5 in 2015, 67.5 in 2014, 183 in 2013, 284 in 2012, 292 in 2011
- The company has unprofitable business model: ROIC is at -8.8%
- It operates with medium-size leverage: Net Debt/EBITDA is 6.2x while industry average is 6.2x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Mongolian Mining Corp ($975) key annual financial indicators
| mln. $ | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 542.6 | 474.5 | 437.3 | 328.3 | 99.5 | -69.7% |
| Gross Profit | 206.2 | 54.1 | 75.9 | -7.2 | -66.1 | 817.9% |
| SG&A | | | | 87.4 | 39.1 | -55.2% |
| EBITDA | 166.2 | 61.0 | 89.0 | -47.8 | -66.3 | 38.8% |
| Net Income | 119.1 | -2.5 | -58.1 | -282.8 | -187.8 | -33.6% |
Balance Sheet
|
|---|
| Cash | 41.0 | 44.3 | 26.5 | 202.9 | 50.7 | -75.0% |
| Short Term Debt | 417.3 | 272.0 | 246.9 | 114.8 | 197.6 | 72.1% |
| Long Term Debt | 144.9 | 842.1 | 744.4 | 757.9 | 597.6 | -21.1% |
Cash flow
|
|---|
| Capex | 292.3 | 284.4 | 183.5 | 67.5 | 42.5 | -37.1% |
Ratios
|
|---|
| Revenue growth | 95.5% | -12.5% | -7.8% | -24.9% | -69.7% | |
| EBITDA growth | 98.5% | -63.3% | 46.0% | -153.7% | 38.8% | |
| Gross Margin | 38.0% | 11.4% | 17.3% | -2.2% | -66.5% | -64.3% |
| EBITDA Margin | 30.6% | 12.8% | 20.3% | -14.6% | -66.7% | -52.1% |
| Net Income Margin | 21.9% | -0.5% | -13.3% | -86.2% | -188.7% | -102.6% |
| SG&A, % of revenue | | | | 26.6% | 39.3% | 12.7% |
| CAPEX, % of revenue | 53.9% | 59.9% | 42.0% | 20.5% | 42.7% | 22.1% |
| ROIC | 11.7% | 0.8% | 1.3% | -6.2% | -8.8% | -2.7% |
| ROE | 15.9% | -0.3% | -8.8% | -59.1% | -64.1% | -5.0% |
| Net Debt/EBITDA | 3.1x | 17.6x | 10.8x | | | 0.0x |
Revenue and profitability
The company's Revenue dropped on 69.7% in 2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 52.1 pp from -14.6% to -66.7% in 2015.
Gross Margin dropped on 64.3 pp from -2.2% to -66.5% in 2015. SG&A as a % of Revenue surged on 12.7 pp from 26.6% to 39.3% in 2015.
Net Income marign dropped on 103 pp from -86.2% to -189% in 2015.
Capital expenditures (CAPEX) and working capital investments
Mongolian Mining Corp's CAPEX/Revenue was 42.7% in 2015. CAPEX/Revenue dropped on 17.3 pp from 59.9% in 2012 to 42.7% in 2015. Average CAPEX/Revenue for the last three years was 35.1%.
Return on investment
The company operates at negative ROIC (-8.85%) and ROE (-64.08%). ROIC decreased on 2.7 pp from -6.2% to -8.8% in 2015. ROE decreased on 5.0 pp from -59.1% to -64.1% in 2015.
Leverage (Debt)
Debt level is 6.2x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA didn't change in 2015. Debt decreased on 8.9% in 2015 while cash dropped on 75.0% in 2015.
Management team
Battsengel Gotov is a the company's CEO. Battsengel Gotov has spent 10 years at the company. Mongolian Mining Corp's CFO Ulemj Baskhuu has spent 5 years at the company.
Appendix 1: Peers in Coal
Below we provide Mongolian Mining Corp benchmarking against other companies in Coal 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 |
|---|
| Kinetic Mines and Energy Ltd ($1277) | | | 299.9% | 563.4% | 40.0% |
| Feishang Anthracite Resources Ltd ($1738) | 172.1% | 34.9% | 25.8% | 103.6% | |
| Loudong General Nice Resources China Holdings Ltd ($988) | 8.5% | -12.7% | 39.1% | 87.6% | |
| Rosan Resources Holdings Ltd ($578) | -19.9% | -74.1% | 71.1% | 49.1% | |
| Asia Coal Ltd ($835) | | 32.1% | -15.3% | 43.2% | 133.6% |
| |
|---|
| Median (22 companies) | 13.0% | 1.4% | -7.6% | -8.2% | 1.1% |
|---|
| Mongolian Mining Corp ($975) | | -12.5% | -7.8% | -24.9% | -69.7% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Asia Coal Ltd ($835) | 32.4% | 56.7% | 62.6% | 76.7% | 5.8% |
| Shougang Fushan Resources Group Ltd ($639) | 70.4% | 63.5% | 50.9% | 40.1% | 24.5% |
| Agritrade Resources Ltd ($1131) | 7.6% | 22.9% | 29.4% | 31.8% | 30.0% |
| Kinetic Mines and Energy Ltd ($1277) | | 20.6% | 28.8% | 30.3% | 10.9% |
| China Shenhua Energy Co Ltd ($1088) | 39.9% | 31.4% | 28.7% | 29.6% | 35.5% |
| |
|---|
| Median (22 companies) | 30.0% | 20.3% | 17.6% | 10.5% | 6.9% |
|---|
| Mongolian Mining Corp ($975) | 38.0% | 11.4% | 17.3% | -2.2% | -66.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Shenhua Energy Co Ltd ($1088) | 41.2% | 35.6% | 31.6% | 34.2% | 33.9% |
| Agritrade Resources Ltd ($1131) | 1.4% | 41.6% | 37.3% | 33.4% | 31.1% |
| Kinetic Mines and Energy Ltd ($1277) | | -277.0% | -51.9% | 29.3% | 15.8% |
| Inner Mongolia Yitai Coal Co Ltd ($3948) | 40.9% | 33.1% | 30.7% | 22.8% | |
| Feishang Anthracite Resources Ltd ($1738) | -9.2% | -13.1% | -32.9% | 19.0% | |
| |
|---|
| Median (23 companies) | 11.1% | -1.1% | -4.3% | -6.5% | -18.0% |
|---|
| Mongolian Mining Corp ($975) | 30.6% | 12.8% | 20.3% | -14.6% | -66.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Up Energy Development Group Ltd ($307) | | | | 279.5% | 75.2% |
| Siberian Mining Group Co Ltd ($1142) | 129.1% | 4.6% | 78.8% | 217.3% | 279.7% |
| King Stone Energy Group Ltd ($663) | 82.7% | 58.5% | 135.3% | 205.7% | |
| Asia Coal Ltd ($835) | 121.4% | 12.5% | 25.8% | 111.0% | 0.3% |
| Hidili Industry International Development Ltd ($1393) | 74.1% | 82.3% | 144.6% | 92.3% | |
| |
|---|
| Median (23 companies) | 21.9% | 13.7% | 23.0% | 17.8% | 14.9% |
|---|
| Mongolian Mining Corp ($975) | 53.9% | 59.9% | 42.0% | 20.5% | 42.7% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Shenhua Energy Co Ltd ($1088) | 21.0% | 19.5% | 17.4% | 14.6% | 7.7% |
| Loudong General Nice Resources China Holdings Ltd ($988) | 11.5% | 4.1% | 8.2% | 9.6% | |
| Kinetic Mines and Energy Ltd ($1277) | -2.6% | -6.6% | -5.7% | 8.5% | 3.2% |
| Inner Mongolia Yitai Coal Co Ltd ($3948) | 37.6% | 28.5% | 15.2% | 8.5% | |
| Agritrade Resources Ltd ($1131) | -2.3% | 2.7% | 5.8% | 6.4% | 6.9% |
| |
|---|
| Median (23 companies) | 0.6% | -2.6% | -2.1% | -1.8% | -0.9% |
|---|
| Mongolian Mining Corp ($975) | 11.7% | 0.8% | 1.3% | -6.2% | -8.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Feishang Anthracite Resources Ltd ($1738) | | | | 24.3x | |
| China Coal Energy Co Ltd ($1898) | 0.5x | 1.9x | 4.9x | 9.7x | 14.4x |
| Loudong General Nice Resources China Holdings Ltd ($988) | 2.0x | 5.8x | 4.4x | 6.0x | |
| Yanzhou Coal Mining Co Ltd ($1171) | 1.1x | 2.9x | 6.2x | 4.9x | |
| Kinetic Mines and Energy Ltd ($1277) | | | | 4.5x | 5.9x |
| |
|---|
| Median (9 companies) | 1.0x | 1.9x | 3.1x | 4.5x | 2.4x |
|---|
