Global Offshore Services reports 16.3% Net Income growth while 2.7 pp EBITDA Margin decline from 48.3% to 45.6%
29-05-2015 • About Global Offshore Services (
$GLOBOFFS) • By InTwits
Global Offshore Services reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- The company has potentially unprofitable business model: ROIC is at 6.7%
- It operates with high leverage: Net Debt/EBITDA is 5.6x while industry average is 3.7x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Global Offshore Services ($GLOBOFFS) key annual financial indicators
| mln. INR | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 1,968 | 2,244 | 2,309 | 3,516 | 3,814 | 8.5% |
| EBITDA | 840 | 944 | 1,442 | 1,697 | 1,738 | 2.4% |
| Net Income | 220 | 240 | 520 | 382 | 444 | 16.3% |
Balance Sheet
|
|---|
| Cash | 226 | 297 | 128 | 169 | 503 | 197.0% |
| Short Term Debt | 870 | 1,263 | 1,232 | 1,741 | 1,547 | -11.2% |
| Long Term Debt | 5,281 | 5,472 | 7,232 | 9,253 | 8,625 | -6.8% |
Cash flow
|
|---|
| Capex | | 889 | 3,235 | 3,733 | 0 | -100.0% |
Ratios
|
|---|
| Revenue growth | -55.7% | 14.0% | 2.9% | 52.2% | 8.5% | |
| EBITDA growth | -22.9% | 12.3% | 52.7% | 17.7% | 2.4% | |
| EBITDA Margin | 42.7% | 42.1% | 62.4% | 48.3% | 45.6% | -2.7% |
| Net Income Margin | 11.2% | 10.7% | 22.5% | 10.9% | 11.6% | 0.8% |
| CAPEX, % of revenue | | 39.6% | 140.1% | 106.2% | 0.0% | -106.2% |
| ROIC | 6.0% | 5.6% | 9.0% | 7.1% | 6.7% | -0.4% |
| ROE | 8.1% | 8.9% | 16.5% | 10.1% | 10.5% | 0.3% |
| Net Debt/EBITDA | 7.0x | 6.8x | 5.8x | 6.4x | 5.6x | -0.8x |
Revenue and profitability
Global Offshore Services's Revenue increased on 8.5% in FY2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 14.1 pp from 17.0% to 2.9% in FY2015.
Net Income marign increased slightly on 0.78 pp from 10.9% to 11.6% in FY2015.
Return on investment
The company operates at low ROIC (6.72%) and ROE (10.49%). ROIC showed almost no change in FY2015. ROE showed almost no change in FY2015.
Leverage (Debt)
Debt level is 5.6x Net Debt / EBITDA and 5.9x Debt / EBITDA. Net Debt / EBITDA dropped on 0.8x from 6.4x to 5.6x in FY2015. Debt decreased on 7.5% in FY2015 while cash jumped on 197% in FY2015.
Valuation
Global Offshore Services's trades at EV/EBITDA 14.8x and P/E 36.1x while industy averages are 10.5x and 26.1x.
Appendix 1: Peers in Shipping
Below you can find Global Offshore Services benchmarking vs. other companies in Shipping 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 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Shreyas Shipping & Logistics ($SHREYAS) | | 42.2% | 43.6% | 25.3% | 12.0% |
| Great Eastern Shipping Co ($GESHIP) | | 20.6% | 1.6% | 2.3% | 11.8% |
| Shipping Corporation Of India ($SCI) | | 7.8% | 8.7% | 0.0% | -0.0% |
| |
|---|
| Median (3 companies) | | 20.6% | 8.7% | 2.3% | 11.8% |
|---|
| Global Offshore Services ($GLOBOFFS) | | 14.0% | 2.9% | 52.2% | 8.5% |
Top companies by EBITDA margin, %
| Top | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Great Eastern Shipping Co ($GESHIP) | 36.7% | 37.1% | 39.0% | 47.1% | 44.7% |
| Shipping Corporation Of India ($SCI) | 27.2% | 7.8% | 6.1% | 14.2% | 23.5% |
| Shreyas Shipping & Logistics ($SHREYAS) | 16.2% | 9.0% | 10.7% | 9.4% | 13.6% |
| |
|---|
| Median (3 companies) | 27.2% | 9.0% | 10.7% | 14.2% | 23.5% |
|---|
| Global Offshore Services ($GLOBOFFS) | 42.7% | 42.1% | 62.4% | 48.3% | 45.6% |
Top companies by CAPEX/Revenue, %
| Top | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Great Eastern Shipping Co ($GESHIP) | 105.3% | 51.0% | 48.2% | 20.4% | 45.5% |
| Shipping Corporation Of India ($SCI) | 92.1% | 57.3% | 70.2% | 27.3% | 17.2% |
| Shreyas Shipping & Logistics ($SHREYAS) | 2.7% | 7.5% | 17.9% | 1.3% | 11.3% |
| |
|---|
| Median (3 companies) | 92.1% | 51.0% | 48.2% | 20.4% | 17.2% |
|---|
| Global Offshore Services ($GLOBOFFS) | | 39.6% | 140.1% | 106.2% | 0.0% |
Top companies by ROIC, %
| Top | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Shreyas Shipping & Logistics ($SHREYAS) | 8.9% | 4.8% | 9.4% | 9.8% | 20.7% |
| Great Eastern Shipping Co ($GESHIP) | 4.1% | 4.4% | 4.5% | 6.0% | 7.1% |
| Shipping Corporation Of India ($SCI) | 4.8% | -2.5% | -3.6% | -1.8% | 1.5% |
| |
|---|
| Median (3 companies) | 4.8% | 4.4% | 4.5% | 6.0% | 7.1% |
|---|
| Global Offshore Services ($GLOBOFFS) | 6.0% | 5.6% | 9.0% | 7.1% | 6.7% |
Top companies by Net Debt / EBITDA
| Top | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Shipping Corporation Of India ($SCI) | 2.3x | 16.3x | 27.2x | 12.3x | 5.7x |
| Great Eastern Shipping Co ($GESHIP) | 3.2x | 5.9x | 5.8x | 3.7x | 2.2x |
| Shreyas Shipping & Logistics ($SHREYAS) | 1.9x | 3.0x | 3.0x | 2.3x | 1.3x |
| |
|---|
| Median (3 companies) | 2.3x | 5.9x | 5.8x | 3.7x | 2.2x |
|---|
| Global Offshore Services ($GLOBOFFS) | 7.0x | 6.8x | 5.8x | 6.4x | 5.6x |
