PetroChina Co Ltd revenue jumped on 41.1% while EBITDA Margin decreased slightly on 1.9 pp from 17.0% to 15.1%
22/03/2018 • About PetroChina Co Ltd (
$857) • By InTwits
PetroChina Co Ltd reported 2017 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is relatively stable: 15.1% in 2017 vs. 17.0% in 2016 vs. 15.6% in 2013
- PetroChina Co Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 12.8%. At the same time it's in pair with industry average of 12.1%.
- The company has potentially unprofitable business model: ROIC is at 3.5%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
PetroChina Co Ltd ($857) key annual financial indicators
| mln. CNY | 2013 | 2014 | 2015 | 2016 | 2017 | 2017/2016 |
|---|
P&L
|
|---|
| Revenue | 2,258,124 | 2,282,962 | 1,725,428 | 1,429,057 | 2,015,890 | 41.1% |
| Gross Profit | | | | 193,350 | | -100.0% |
| SG&A | 79,021 | 73,413 | 71,270 | 124,328 | 77,042 | -38.0% |
| EBITDA | 351,649 | 347,021 | 281,839 | 242,983 | 305,055 | 25.5% |
| Net Income | 129,599 | 107,172 | 35,517 | 7,900 | 22,798 | 188.6% |
Balance Sheet
|
|---|
| Cash | 51,407 | 73,778 | 72,773 | 98,617 | 122,777 | 24.5% |
| Short Term Debt | 192,586 | 167,783 | 106,027 | 153,317 | 175,287 | 14.3% |
| Long Term Debt | 302,862 | 370,301 | 434,475 | 372,887 | 289,858 | -22.3% |
Cash flow
|
|---|
| Capex | 304,100 | 306,551 | 217,750 | 189,421 | 229,239 | 21.0% |
Ratios
|
|---|
| Revenue growth | 2.9% | 1.1% | -24.4% | -17.2% | 41.1% | |
| EBITDA growth | 7.8% | -1.3% | -18.8% | -13.8% | 25.5% | |
| Gross Margin | | | | 13.5% | | -13.5% |
| EBITDA Margin | 15.6% | 15.2% | 16.3% | 17.0% | 15.1% | -1.9% |
| Net Income Margin | 5.7% | 4.7% | 2.1% | 0.6% | 1.1% | 0.6% |
| SG&A, % of revenue | 3.5% | 3.2% | 4.1% | 8.7% | 3.8% | -4.9% |
| CAPEX, % of revenue | 13.5% | 13.4% | 12.6% | 13.3% | 11.4% | -1.9% |
| ROIC | 10.9% | 9.3% | 4.2% | 2.0% | 3.5% | 1.5% |
| ROE | 11.8% | 9.3% | 3.0% | 0.7% | 1.9% | 1.2% |
| Net Debt/EBITDA | 1.3x | 1.3x | 1.7x | 1.8x | 1.1x | -0.6x |
PetroChina Co Ltd ($857) key quoterly financial indicators
| mln. CNY | 17Q1 | 17Q2 | 17Q3 | 17Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 445,669 | 435,607 | 430,483 | 558,186 | 26.3% | 12.8% | 4.6% | 34.4% |
| Net Income | 5,699 | 6,975 | 4,688 | 5,432 | | -51.3% | 290.7% | -12.0% |
Balance Sheet
|
|---|
| Cash | 101,037 | 121,052 | 169,469 | 122,777 | 1.4% | 19.5% | 41.3% | 24.5% |
| Short Term Debt | 206,479 | 201,559 | 205,720 | 175,287 | 49.0% | 47.6% | 45.9% | 14.3% |
| Long Term Debt | 294,343 | 300,191 | 299,925 | 289,858 | -30.7% | -27.7% | -21.9% | -22.3% |
Ratios
|
|---|
| Net Income Margin | 1.3% | 1.6% | 1.1% | 1.0% | 5.2% | -2.1% | 0.8% | -0.5% |
Revenue and profitability
PetroChina Co Ltd's Revenue jumped on 41.1%. Revenue growth showed slow down in 17Q4 - it was 34.4% YoY. Revenue growth was financed by EBITDA margin decline. EBITDA Margin decreased slightly on 1.9 pp from 17.0% to 15.1% in 2017.
SG&A as a % of Revenue decreased on 4.9 pp from 8.7% to 3.8% in 2017.
Net Income marign increased slightly on 0.58 pp from 0.55% to 1.1% in 2017.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 11.4% in 2017. PetroChina Co Ltd's CAPEX/Revenue decreased on 2.1 pp from 13.4% in 2014 to 11.4% in 2017. It's average level of CAPEX/Revenue for the last three years was 12.4%.PetroChina Co Ltd invested a big chunk of EBITDA (75.1%) to CAPEX to secure its growth.
Return on investment
The company operates at low ROIC (3.53%) and ROE (1.91%). ROIC increased slightly on 1.5 pp from 2.0% to 3.5% in 2017. ROE increased slightly on 1.2 pp from 0.67% to 1.9% in 2017.
Leverage (Debt)
Debt level is 1.1x Net Debt / EBITDA and 1.5x Debt / EBITDA. Net Debt / EBITDA dropped on 0.6x from 1.8x to 1.1x in 2017. Debt dropped on 11.6% while cash jumped on 24.5%.
Appendix 1: Peers in Oil&Gas
Below we provide PetroChina Co Ltd benchmarking against other companies in Oil&Gas 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 | FY2013 | FY2014 | FY2015 | FY2016 | FY2017 |
|---|
| PetroAsian Energy Holdings Ltd ($850) | 191.7% | -1.0% | -18.1% | 637.7% | |
| Shanghai Tonva Petrochemical Co Ltd ($1103) | 33.1% | -10.1% | 55.4% | 74.7% | |
| COSCO International Holdings Ltd ($517) | -7.0% | -18.5% | -20.9% | 23.8% | |
| Zhongyu Gas Holdings Ltd ($3633) | 13.7% | 9.0% | -4.0% | 13.6% | |
| CNOOC Ltd ($883) | | -3.9% | -37.6% | -14.6% | 27.2% |
| |
|---|
| Median (7 companies) | 8.7% | -4.3% | -11.9% | 13.6% | 27.2% |
|---|
Top companies by Gross margin, %
| Top | FY2013 | FY2014 | FY2015 | FY2016 | FY2017 |
|---|
| United Energy Group Ltd ($467) | 48.0% | 53.8% | 51.5% | 52.6% | |
| Brightoil Petroleum Holdings Ltd ($933) | 2.1% | 2.1% | 2.6% | 4.2% | |
| Shanghai Tonva Petrochemical Co Ltd ($1103) | 6.8% | 7.3% | 6.1% | 4.2% | |
| PetroAsian Energy Holdings Ltd ($850) | 4.1% | 2.7% | 0.4% | 2.1% | |
| |
|---|
| Median (4 companies) | 5.4% | 9.7% | 6.1% | 4.2% | |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2013 | FY2014 | FY2015 | FY2016 | FY2017 |
|---|
| United Energy Group Ltd ($467) | 65.3% | 69.8% | -31.9% | 70.5% | |
| CNOOC Ltd ($883) | 47.2% | 50.7% | 53.0% | 44.8% | 52.4% |
| Brightoil Petroleum Holdings Ltd ($933) | -0.6% | 1.4% | 4.7% | 6.5% | |
| Shanghai Tonva Petrochemical Co Ltd ($1103) | 6.0% | 6.9% | 5.4% | 3.5% | |
| PetroAsian Energy Holdings Ltd ($850) | -5.7% | -9.8% | -10.9% | 0.2% | |
| |
|---|
| Median (5 companies) | 0.4% | 5.2% | -6.7% | 6.5% | 52.4% |
|---|
Top companies by CAPEX/Revenue, %
| Top | FY2013 | FY2014 | FY2015 | FY2016 | FY2017 |
|---|
| CNOOC Ltd ($883) | 30.3% | 34.8% | 39.5% | 35.1% | 25.6% |
| Brightoil Petroleum Holdings Ltd ($933) | 2.7% | 0.6% | 0.9% | 3.1% | |
| PetroAsian Energy Holdings Ltd ($850) | 1.0% | 0.2% | 0.8% | 1.7% | |
| |
|---|
| Median (3 companies) | 7.9% | 7.5% | 6.5% | 3.1% | 25.6% |
|---|
Top companies by ROIC, %
| Top 5 | FY2013 | FY2014 | FY2015 | FY2016 | FY2017 |
|---|
| United Energy Group Ltd ($467) | 10.3% | 15.7% | -25.0% | 10.8% | |
| Shanghai Tonva Petrochemical Co Ltd ($1103) | 12.6% | 13.0% | 13.9% | 9.6% | |
| Brightoil Petroleum Holdings Ltd ($933) | -4.4% | 6.5% | 13.8% | 6.7% | |
| PetroAsian Energy Holdings Ltd ($850) | -10.3% | -15.5% | -13.4% | -0.0% | |
| CNOOC Ltd ($883) | 18.1% | 15.8% | 3.2% | -0.6% | 7.2% |
| |
|---|
| Median (8 companies) | 0.8% | 0.1% | -1.7% | 3.3% | 7.2% |
|---|
Top companies by Net Debt / EBITDA
| Top 5 | FY2013 | FY2014 | FY2015 | FY2016 | FY2017 |
|---|
| PetroAsian Energy Holdings Ltd ($850) | | | | 13.9x | |
| Shanghai Tonva Petrochemical Co Ltd ($1103) | 4.3x | 3.6x | 2.8x | 3.5x | |
| Brightoil Petroleum Holdings Ltd ($933) | | 3.1x | 2.9x | 2.6x | |
| CNOOC Ltd ($883) | 0.9x | 0.9x | 1.7x | 2.1x | 1.2x |
| United Energy Group Ltd ($467) | 1.1x | 0.6x | | -0.9x | |
| |
|---|
| Median (5 companies) | 1.0x | 3.1x | 2.1x | 2.6x | 1.2x |
|---|
