United Co RUSAL PLC Net Income surged on 111% in 2016 while EBITDA Margin decreased on 2.4 pp from 21.5% to 19.1%
17/03/2017 • About United Co RUSAL PLC (
$486) • By InTwits
United Co RUSAL PLC reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- United Co RUSAL PLC is a company in decline: FY2016 revenue growth was -8.0%, 5 years revenue CAGR was -8.3%
- EBITDA Margin is quite volatile: 19.1% in FY2016, 21.5% in FY2015, 15.0% in FY2014, -13.2% in FY2013, 5.5% in FY2012
- United Co RUSAL PLC has medium CAPEX intensity: 5 year average CAPEX/Revenue was 5.6%. At the same time it's a lot of higher than industry average of 8.6%.
- CAPEX is quite volatile: 2,677 in 2016, 6,180 in 2015, 5,301 in 2014, 9,886 in 2013, 5,328 in 2012
- The company has business model with low profitability: ROIC is at 9.0%
- It operates with medium-size leverage: Net Debt/EBITDA is 5.5x while industry average is 5.7x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
United Co RUSAL PLC ($486) key annual financial indicators
| mln. $ | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 10,891 | 9,760 | 9,357 | 8,680 | 7,983 | -8.0% |
| Gross Profit | 1,659 | 1,331 | 2,134 | 2,465 | 1,913 | -22.4% |
| SG&A | 1,217 | 1,106 | 983 | 847 | 833 | -1.7% |
| EBITDA | 603 | -1,284 | 1,401 | 1,866 | 1,521 | -18.5% |
| Net Income | -528 | -3,322 | -91 | 558 | 1,179 | 111.3% |
Balance Sheet
|
|---|
| Cash | 490 | 701 | 557 | 494 | 531 | 7.5% |
| Short Term Debt | 931 | 1,676 | 447 | 1,355 | 1,433 | 5.8% |
| Long Term Debt | 10,403 | 9,149 | 8,960 | 7,525 | 7,532 | 0.1% |
Cash flow
|
|---|
| Capex | 486 | 538 | 465 | 510 | 558 | 9.4% |
Ratios
|
|---|
| Revenue growth | -11.4% | -10.4% | -4.1% | -7.2% | -8.0% | |
| EBITDA growth | -73.4% | -312.9% | -209.1% | 33.2% | -18.5% | |
| Gross Margin | 15.2% | 13.6% | 22.8% | 28.4% | 24.0% | -4.4% |
| EBITDA Margin | 5.5% | -13.2% | 15.0% | 21.5% | 19.1% | -2.4% |
| Net Income Margin | -4.8% | -34.0% | -1.0% | 6.4% | 14.8% | 8.3% |
| SG&A, % of revenue | 11.2% | 11.3% | 10.5% | 9.8% | 10.4% | 0.7% |
| CAPEX, % of revenue | 4.5% | 5.5% | 5.0% | 5.9% | 7.0% | 1.1% |
| ROIC | 0.3% | -9.0% | 6.3% | 12.3% | 9.0% | -3.2% |
| ROE | -5.0% | -38.4% | -2.1% | 30.8% | 50.3% | 19.5% |
| Net Debt/EBITDA | 18.0x | | 6.3x | 4.5x | 5.5x | 1.1x |
Revenue and profitability
United Co RUSAL PLC's Revenue decreased on 8.0%. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 2.4 pp from 21.5% to 19.1% in FY2016.
Gross Margin decreased on 4.4 pp from 28.4% to 24.0% in FY2016. SG&A as a % of Revenue increased slightly on 0.68 pp from 9.8% to 10.4% in FY2016.
Net Income marign increased on 8.3 pp from 6.4% to 14.8% in FY2016.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 7.0% in FY2016. The company's CAPEX/Revenue increased slightly on 1.5 pp from 5.5% in FY2013 to 7.0% in FY2016. For the last three years the average CAPEX/Revenue was 5.9%.
Return on investment
The company operates at good ROE (50.28%) while ROIC is low (9.05%). ROIC decreased on 3.2 pp from 12.3% to 9.0% in FY2016. ROE jumped on 19.5 pp from 30.8% to 50.3% in FY2016.
Leverage (Debt)
Debt level is 5.5x Net Debt / EBITDA and 5.9x Debt / EBITDA. Net Debt / EBITDA surged on 1.1x from 4.5x to 5.5x in FY2016. Debt increased slightly on 0.96% while cash increased on 7.5%.
Management team
The company's CEO is Vladislav Soloviev. Vladislav Soloviev has 4 years tenure at the company. The company's CFO is Alexandra Bouriko. Alexandra Bouriko has 5 years tenure at the company.
Appendix 1: Peers in Mining
Below you can find United Co RUSAL PLC 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% | 1,178.3% |
| Real Gold Mining Ltd ($246) | -44.0% | -68.0% | -26.2% | 106.2% | |
| REX Global Entertainment Holdings Ltd ($164) | | 81.6% | -15.5% | 96.4% | 30.4% |
| Hengxing Gold Holding Co Ltd ($2303) | | | 3,467.3% | 78.0% | |
| Zijin Mining Group Co Ltd ($2899) | | 2.5% | 18.1% | 26.9% | 6.1% |
| |
|---|
| Median (47 companies) | 6.7% | 0.6% | -5.9% | -20.8% | 6.1% |
|---|
| United Co RUSAL PLC ($486) | | -10.4% | -4.1% | -7.2% | -8.0% |
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% | 87.4% |
| REX Global Entertainment Holdings Ltd ($164) | -15.8% | -7.8% | -0.8% | 88.6% | 87.3% |
| China Billion Resources Ltd ($274) | 71.4% | 47.2% | 73.4% | 79.7% | |
| Sun International Resources Ltd ($8029) | 83.2% | 73.1% | 64.8% | 69.4% | 58.8% |
| Grand T G Gold Holdings Ltd ($8299) | | | | 57.3% | 59.0% |
| |
|---|
| Median (49 companies) | 15.0% | 14.4% | 15.4% | 14.3% | 28.2% |
|---|
| United Co RUSAL PLC ($486) | 15.2% | 13.6% | 22.8% | 28.4% | 24.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| G-Resources Group Ltd ($1051) | | 54.5% | 53.4% | 58.3% | |
| Grand T G Gold Holdings Ltd ($8299) | | | | 53.7% | 58.9% |
| 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% | 28.0% |
| Hengxing Gold Holding Co Ltd ($2303) | | -766.2% | 24.5% | 43.9% | |
| |
|---|
| Median (49 companies) | 4.9% | 8.5% | 5.2% | 5.1% | 11.2% |
|---|
| United Co RUSAL PLC ($486) | 5.5% | -13.2% | 15.0% | 21.5% | 19.1% |
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% | 20.9% |
| Kaz Minerals ($847) | 36.6% | 136.5% | 168.8% | 168.7% | 41.9% |
| Chinalco Mining Corp International ($3668) | | | | 115.6% | |
| China Dynamics Holdings Ltd ($476) | 1.8% | 0.0% | 1.0% | 113.8% | 5.7% |
| MMG Ltd ($1208) | 25.7% | 22.6% | 41.9% | 100.4% | 31.0% |
| |
|---|
| Median (48 companies) | 17.7% | 17.9% | 16.5% | 12.5% | 7.1% |
|---|
| United Co RUSAL PLC ($486) | 4.5% | 5.5% | 5.0% | 5.9% | 7.0% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| CGN Mining Co Ltd ($1164) | 2.6% | 3.3% | 7.9% | 16.7% | |
| 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% | 3.9% |
| China Hongqiao Group Ltd ($1378) | 24.8% | 17.0% | 14.1% | 10.6% | |
| Hengxing Gold Holding Co Ltd ($2303) | -7.2% | -8.1% | 0.0% | 8.6% | |
| |
|---|
| Median (50 companies) | 1.9% | 2.7% | -0.1% | -1.1% | 1.9% |
|---|
| United Co RUSAL PLC ($486) | 0.3% | -9.0% | 6.3% | 12.3% | 9.0% |
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 | 10.4x |
| Kaz Minerals ($847) | 2.4x | 2.9x | 5.5x | 18.7x | 8.8x |
| China Precious Metal Resources Holdings Co Ltd ($1194) | 1.5x | 4.1x | 6.4x | 13.5x | |
| |
|---|
| Median (29 companies) | 1.7x | 1.9x | 4.4x | 3.4x | 4.2x |
|---|
| United Co RUSAL PLC ($486) | 18.0x | | 6.3x | 4.5x | 5.5x |
