Zijin Mining Group Co Ltd EBITDA jumped on 87.5% in 2016 and Revenue increased on 6.1%
17/03/2017 • About Zijin Mining Group Co Ltd (
$2899) • By InTwits
Zijin Mining Group Co Ltd reported 2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is quite volatile: 11.2% in 2016, 6.4% in 2015, 10.1% in 2014, 14.2% in 2013, 21.6% in 2012
- Zijin Mining Group Co Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 11.7%. At the same time it's a lot of higher than industry average of 19.0%.
- CAPEX is quite volatile: 1,493 in FY2016, 660 in FY2015, 544 in FY2014, 1,504 in FY2013, 1,099 in FY2012
- The company has business model with low profitability: ROIC is at 7.1%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Zijin Mining Group Co Ltd ($2899) key annual financial indicators
| mln. CNY | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 47,874 | 49,052 | 57,922 | 73,494 | 77,943 | 6.1% |
| Gross Profit | 11,499 | 8,206 | 7,040 | 5,486 | 8,161 | 48.8% |
| SG&A | 2,175 | 2,405 | 2,740 | 2,693 | 2,867 | 6.5% |
| EBITDA | 10,327 | 6,979 | 5,871 | 4,669 | 8,752 | 87.5% |
| Net Income | 5,211 | 2,125 | 2,345 | 1,656 | 1,840 | 11.1% |
Balance Sheet
|
|---|
| Cash | 6,467 | 3,878 | 3,320 | 4,792 | 4,843 | 1.1% |
| Short Term Debt | 7,249 | 4,434 | 6,182 | 12,684 | 21,163 | 66.8% |
| Long Term Debt | 9,642 | 12,404 | 16,263 | 17,551 | 22,046 | 25.6% |
Cash flow
|
|---|
| Capex | 7,996 | 8,621 | 6,221 | 4,858 | 5,521 | 13.6% |
Ratios
|
|---|
| Revenue growth | 21.6% | 2.5% | 18.1% | 26.9% | 6.1% | |
| EBITDA growth | -3.5% | -32.4% | -15.9% | -20.5% | 87.5% | |
| Gross Margin | 24.0% | 16.7% | 12.2% | 7.5% | 10.5% | 3.0% |
| EBITDA Margin | 21.6% | 14.2% | 10.1% | 6.4% | 11.2% | 4.9% |
| Net Income Margin | 10.9% | 4.3% | 4.0% | 2.3% | 2.4% | 0.1% |
| SG&A, % of revenue | 4.5% | 4.9% | 4.7% | 3.7% | 3.7% | 0.0% |
| CAPEX, % of revenue | 16.7% | 17.6% | 10.7% | 6.6% | 7.1% | 0.5% |
| ROIC | 18.8% | 9.2% | 6.5% | 2.6% | 7.1% | 4.5% |
| ROE | 19.6% | 7.6% | 8.4% | 6.0% | 6.7% | 0.7% |
| Net Debt/EBITDA | 1.0x | 1.9x | 3.3x | 5.4x | 4.4x | -1.1x |
Revenue and profitability
Zijin Mining Group Co Ltd's Revenue increased on 6.1%. Revenue growth happened at the same time with EBITDA margin expansion. EBITDA Margin increased on 4.9 pp from 6.4% to 11.2% in 2016.
Gross Margin increased on 3.0 pp from 7.5% to 10.5% in 2016. SG&A as a % of Revenue showed almost no change in 2016.
Net Income marign showed almost no change in 2016.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 7.1% in 2016. The company's CAPEX/Revenue dropped on 10.5 pp from 17.6% in 2013 to 7.1% in 2016. It's average level of CAPEX/Revenue for the last three years was 8.1%.Zijin Mining Group Co Ltd maintained rich investment policy and has spent a big chunk of EBITDA (63.1%) to CAPEX.
Return on investment
The company operates at low ROIC (7.10%) and ROE (6.65%). ROIC increased on 4.5 pp from 2.6% to 7.1% in 2016. ROE increased slightly on 0.70 pp from 6.0% to 6.7% in 2016.
Leverage (Debt)
Company's Net Debt / EBITDA is 4.4x and Debt / EBITDA is 4.9x. Net Debt / EBITDA dropped on 1.1x from 5.4x to 4.4x in 2016. Debt jumped on 42.9% while cash increased slightly on 1.1%.
Appendix 1: Peers in Mining
Below you can find Zijin Mining Group Co 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% | 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% | |
| China Gold International Resources Corp Ltd ($2099) | | -9.0% | -8.2% | 22.4% | |
| |
|---|
| Median (47 companies) | 6.7% | -1.7% | -5.9% | -20.8% | 3.8% |
|---|
| Zijin Mining Group Co Ltd ($2899) | | 2.5% | 18.1% | 26.9% | 6.1% |
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) | 14.4% | 13.8% | 15.5% | 16.7% | 28.2% |
|---|
| Zijin Mining Group Co Ltd ($2899) | 24.0% | 16.7% | 12.2% | 7.5% | 10.5% |
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% | 7.8% | 5.2% | 5.1% | 11.5% |
|---|
| Zijin Mining Group Co Ltd ($2899) | 21.6% | 14.2% | 10.1% | 6.4% | 11.2% |
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% | 17.1% | 16.5% | 12.5% | 7.0% |
|---|
| Zijin Mining Group Co Ltd ($2899) | 16.7% | 17.6% | 10.7% | 6.6% | 7.1% |
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% | 9.0% |
| 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% | |
| |
|---|
| Median (50 companies) | 0.9% | 2.3% | -0.1% | -1.1% | 1.9% |
|---|
| Zijin Mining Group Co Ltd ($2899) | 18.8% | 9.2% | 6.5% | 2.6% | 7.1% |
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) | 2.0x | 1.9x | 4.6x | 3.4x | 4.8x |
|---|
| Zijin Mining Group Co Ltd ($2899) | 1.0x | 1.9x | 3.3x | 5.4x | 4.4x |
