Sun International Resources Ltd reports 52.3% CAPEX decline in 2016 and 17.7% Revenue decline
19/06/2016 • About Sun International Resources Ltd (
$8029) • By InTwits
Sun International Resources Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Sun International Resources Ltd is a company in decline: FY2016 revenue growth was -17.7%, 5 years revenue CAGR was -9.7%
- The company operates at negative EBITDA Margin: -37.0%
- Sun International Resources Ltd motivates its personel by high Stock Based Compensation (SBC): average SBC/Revenue for FY2012-FY2016 was 0.0%. On average EBITDA Margin was -6.9% for the sames years0
- Sun International Resources Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 19.9%. At the same time it's a lot of higher than industry average of 45.6%.
- CAPEX is quite volatile: 16.4 in FY2016, 34.3 in FY2015, 71.0 in FY2014, 31.3 in FY2013, 11.1 in FY2012
- The company has unprofitable business model: ROIC is at -10.0%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Sun International Resources Ltd ($8029) key annual financial indicators
| mln. | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 234.1 | 239.7 | 159.1 | 147.1 | 121.1 | -17.7% |
| Gross Profit | 194.7 | 175.3 | 103.1 | 102.2 | 71.2 | -30.3% |
| SG&A | | | 142.6 | 188.6 | 122.2 | -35.2% |
| EBITDA | 55.2 | 27.4 | -22.4 | -77.4 | -44.8 | |
| Net Income | 87.6 | -327.5 | -338.9 | -427.9 | -115.7 | |
Balance Sheet
|
|---|
| Cash | 57.5 | 172.9 | 65.1 | 50.4 | 105.5 | 109.2% |
| Short Term Debt | 140.0 | 45.1 | 140.0 | 140.0 | 140.0 | 0.0% |
| Long Term Debt | 81.3 | 0.0 | 101.2 | 221.0 | 352.0 | 59.3% |
Cash flow
|
|---|
| Capex | 11.1 | 31.3 | 71.0 | 34.3 | 16.4 | -52.3% |
Ratios
|
|---|
| Revenue growth | 16.3% | 2.4% | -33.6% | -7.5% | -17.7% | |
| EBITDA growth | -1,710.8% | -50.3% | -181.6% | 245.7% | -42.1% | |
| Gross Margin | 83.2% | 73.1% | 64.8% | 69.4% | 58.8% | -10.7% |
| EBITDA Margin | 23.6% | 11.4% | -14.1% | -52.6% | -37.0% | 15.6% |
| Net Income Margin | 37.4% | -136.6% | -213.0% | -290.8% | -95.5% | 195.3% |
| SG&A, % of revenue | | | 89.6% | 128.2% | 100.9% | -27.3% |
| CAPEX, % of revenue | 4.8% | 13.0% | 44.7% | 23.3% | 13.5% | -9.8% |
| ROIC | 1.5% | 0.9% | -3.7% | -13.2% | -10.0% | 3.2% |
| ROE | 7.3% | -30.9% | -45.5% | -112.5% | -94.9% | 17.5% |
| Net Debt/EBITDA | 3.0x | -4.7x | | | | 0.0x |
Revenue and profitability
Sun International Resources Ltd's Revenue dropped on 17.7%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin jumped on 15.6 pp from -52.6% to -37.0% in FY2016.
Gross Margin dropped on 10.7 pp from 69.4% to 58.8% in FY2016. SG&A as a % of Revenue dropped on 27.3 pp from 128% to 101% in FY2016.
Net Income marign surged on 195 pp from -291% to -95.5% in FY2016.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 13.5% in FY2016. CAPEX/Revenue showed almost no change from FY2013 to FY2016. It's average CAPEX/Revenue for the last three years was 27.2%.
Return on investment
The company operates at negative ROIC (-10.01%) and ROE (-94.94%). ROIC increased on 3.2 pp from -13.2% to -10.0% in FY2016. ROE jumped on 17.5 pp from -112% to -94.9% in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is -25.0x and Debt / EBITDA is . Net Debt / EBITDA didn't change in FY2016. Debt jumped on 36.3% while cash surged on 109%.
Appendix 1: Peers in Mining
Below you can find Sun International Resources 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 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Mongolia Energy Corp Ltd ($276) | | 89.7% | -95.8% | 2,361.6% | |
| Real Gold Mining Ltd ($246) | -44.0% | -68.0% | -26.2% | 106.2% | |
| REX Global Entertainment Holdings Ltd ($164) | -12.3% | 81.6% | -15.5% | 96.4% | |
| Hengxing Gold Holding Co Ltd ($2303) | | | 3,467.3% | 78.0% | |
| Zijin Mining Group Co Ltd ($2899) | 21.6% | 2.5% | 18.1% | 26.9% | |
| |
|---|
| Median (47 companies) | 5.0% | -1.7% | -5.1% | -20.8% | |
|---|
| Sun International Resources Ltd ($8029) | | 2.4% | -33.6% | -7.5% | -17.7% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Sino Prosper Group Holdings Ltd ($766) | 2.5% | 5.1% | 39.6% | 93.0% | |
| REX Global Entertainment Holdings Ltd ($164) | -15.8% | -7.8% | -0.8% | 88.6% | |
| China Billion Resources Ltd ($274) | 71.4% | 47.2% | 73.4% | 79.7% | |
| Timeless Software Ltd ($8028) | 17.7% | 48.5% | 29.4% | 42.1% | |
| China Precious Metal Resources Holdings Co Ltd ($1194) | 63.9% | 54.9% | 51.2% | 41.8% | |
| |
|---|
| Median (48 companies) | 14.4% | 13.8% | 15.4% | 12.7% | |
|---|
| Sun International Resources Ltd ($8029) | 83.2% | 73.1% | 64.8% | 69.4% | 58.8% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| G-Resources Group Ltd ($1051) | | 54.5% | 53.4% | 58.3% | |
| China Precious Metal Resources Holdings Co Ltd ($1194) | 70.0% | 64.6% | 59.6% | 51.3% | |
| Timeless Software Ltd ($8028) | -113.1% | 24.7% | -13.7% | 46.1% | |
| Hengxing Gold Holding Co Ltd ($2303) | | -766.2% | 24.5% | 43.9% | |
| Sino Prosper Group Holdings Ltd ($766) | -138.6% | -138.2% | -378.4% | 42.9% | |
| |
|---|
| Median (48 companies) | 4.9% | 7.8% | 6.3% | 5.1% | |
|---|
| Sun International Resources Ltd ($8029) | 23.6% | 11.4% | -14.1% | -52.6% | -37.0% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Mongolia Energy Corp Ltd ($276) | 8,006.5% | 1,061.7% | 30,555.4% | 1,973.0% | |
| Kaz Minerals ($847) | 36.6% | 136.5% | 168.8% | 168.7% | |
| Chinalco Mining Corp International ($3668) | | | | 115.6% | |
| China Dynamics Holdings Ltd ($476) | 1.8% | 0.0% | 1.0% | 113.8% | |
| MMG Ltd ($1208) | 25.7% | 22.6% | 41.9% | 100.4% | |
| |
|---|
| Median (48 companies) | 17.7% | 17.9% | 15.8% | 12.1% | |
|---|
| Sun International Resources Ltd ($8029) | 4.8% | 13.0% | 44.7% | 23.3% | 13.5% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| CGN Mining Co Ltd ($1164) | 2.6% | 3.3% | 7.9% | 16.7% | |
| United Co RUSAL PLC ($486) | 0.3% | -9.0% | 6.3% | 12.3% | |
| Xingfa Aluminium Holdings Ltd ($98) | 7.6% | 8.8% | 11.7% | 11.8% | |
| Timeless Software Ltd ($8028) | -29.1% | 7.3% | -4.6% | 11.6% | |
| China Hongqiao Group Ltd ($1378) | 24.8% | 17.0% | 14.1% | 10.6% | |
| |
|---|
| Median (49 companies) | 1.2% | 2.7% | 1.5% | -1.0% | |
|---|
| Sun International Resources Ltd ($8029) | 1.5% | 0.9% | -3.7% | -13.2% | -10.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Daye Non-Ferrous Metals Mining Ltd ($661) | 9.2x | 9.7x | 9.2x | 31.5x | |
| Chinalco Mining Corp International ($3668) | | | | 25.0x | |
| MMG Ltd ($1208) | 2.1x | 2.0x | 10.2x | 20.2x | |
| Kaz Minerals ($847) | 2.4x | 2.9x | 5.5x | 18.7x | |
| China Precious Metal Resources Holdings Co Ltd ($1194) | 1.5x | 4.1x | 6.4x | 13.5x | |
| |
|---|
| Median (29 companies) | 1.7x | 1.9x | 4.5x | 3.4x | |
|---|
