Severstal PJSC Net Income jumped on 138% in 2015 while Revenue dropped on 22.9%
03 Feb 2016 • About Severstal PJSC (
$SVST) • By InTwits
Severstal PJSC reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Severstal PJSC is a company in decline: 2015 revenue growth was -22.9%, 5 years revenue CAGR was -13.0%
- EBITDA Margin is expanding: 32.4% in 2015 vs. 26.4% in 2014 vs. 22.5% in 2011
- Severstal PJSC has medium CAPEX intensity: 5 year average CAPEX/Revenue was 9.0%. At the same time it's in pair with industry average of 10.6%.
- CAPEX is quite volatile: 412 in 2015, 700 in 2014, 968 in 2013, 1,336 in 2012, 1,609 in 2011
- The company has highly profitable business model: ROIC is at 30.3%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Severstal PJSC ($SVST) key annual financial indicators
| mln. $ | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 15,812 | 14,104 | 9,434 | 8,296 | 6,396 | -22.9% |
| Gross Profit | 4,909 | 3,318 | 2,819 | 2,856 | 2,586 | -9.4% |
| SG&A | 1,826 | 1,803 | 1,488 | 1,136 | 808 | -28.9% |
| EBITDA | 3,557 | 2,095 | 1,820 | 2,187 | 2,071 | -5.3% |
| Net Income | 2,035 | 762 | 83 | -1,595 | 605 | -137.9% |
Balance Sheet
|
|---|
| Cash | 1,864 | 1,726 | 1,036 | 1,897 | 1,647 | -13.2% |
| Short Term Debt | 1,192 | 1,384 | 629 | 775 | 507 | -34.6% |
| Long Term Debt | 4,792 | 4,329 | 4,128 | 2,655 | 1,945 | -26.7% |
Cash flow
|
|---|
| Capex | 1,609 | 1,336 | 968 | 700 | 412 | -41.1% |
Ratios
|
|---|
| Revenue growth | 23.4% | -10.8% | -33.1% | -12.1% | -22.9% | |
| EBITDA growth | 27.0% | -41.1% | -13.1% | 20.2% | -5.3% | |
| Gross Margin | 31.0% | 23.5% | 29.9% | 34.4% | 40.4% | 6.0% |
| EBITDA Margin | 22.5% | 14.9% | 19.3% | 26.4% | 32.4% | 6.0% |
| Net Income Margin | 12.9% | 5.4% | 0.9% | -19.2% | 9.5% | 28.7% |
| SG&A, % of revenue | 11.5% | 12.8% | 15.8% | 13.7% | 12.6% | -1.1% |
| CAPEX, % of revenue | 10.2% | 9.5% | 10.3% | 8.4% | 6.4% | -2.0% |
| ROIC | 21.3% | 10.3% | 9.6% | 17.7% | 30.3% | 12.6% |
| ROE | 29.7% | 11.0% | 1.2% | -32.6% | 23.9% | 56.5% |
| Net Debt/EBITDA | 1.2x | 1.9x | 2.0x | 0.7x | 0.4x | -0.3x |
Revenue and profitability
Severstal PJSC's Revenue dropped on 22.9% in 2015. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased on 6.0 pp from 26.4% to 32.4% in 2015.
Gross Margin increased on 6.0 pp from 34.4% to 40.4% in 2015. SG&A as a % of Revenue decreased slightly on 1.1 pp from 13.7% to 12.6% in 2015.
Net Income marign surged on 28.7 pp from -19.2% to 9.5% in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 6.4% in 2015. The company showed decline in CAPEX/Revenue of 3.0 pp from 9.5% in 2012 to 6.4% in 2015. For the last three years the average CAPEX/Revenue was 8.4%.
Return on investment
The company operates at high and attractive ROIC (30.31%) and ROE (23.90%). ROIC jumped on 12.6 pp from 17.7% to 30.3% in 2015. ROE jumped on 56.5 pp from -32.6% to 23.9% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 0.4x and Debt / EBITDA is 1.2x. Net Debt / EBITDA dropped on 0.3x from 0.7x to 0.4x in 2015. Debt dropped on 28.5% in 2015 while cash dropped on 13.2% in 2015.
Appendix 1: Peers in Industrial Metals & Mining
Below you can find Severstal PJSC benchmarking vs. other companies in Industrial Metals & 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 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Afarak Group ($AFRK) | 29.0% | -19.2% | 5.4% | 27.4% | |
| Cheliabinsk Elektrolit Zink Plant ($CHZN) | 8.2% | 2.4% | -0.1% | 26.4% | |
| Norsk Hydro Asa ($NHY) | -5.6% | -10.2% | 1.1% | 20.1% | |
| Aluminium Bahrain Bsc ($ALBH) | 17.6% | -15.8% | 0.8% | 9.7% | |
| Ambrian ($AMBR) | 28,056.2% | -26.8% | 44.6% | 6.8% | |
| |
|---|
| Median (14 companies) | 18.1% | -4.4% | 0.3% | 2.4% | -9.0% |
|---|
| Severstal PJSC ($SVST) | | -10.8% | -33.1% | -12.1% | -22.9% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Mmc Norilsk Nickel ($MNOD) | 59.0% | 49.1% | 43.4% | 52.2% | |
| Cheliabinsk Elektrolit Zink Plant ($CHZN) | 22.5% | 17.7% | 15.1% | 28.6% | |
| Novolipetsk Iron And Steel Corp ($NLMK) | 28.6% | 23.8% | 19.4% | 28.3% | |
| First Quantum Minerals ($FQM) | 50.6% | 37.3% | 31.9% | 28.2% | |
| Magnitogorsk Iron & Steel Works ($MMK) | 16.7% | 15.5% | 14.9% | 21.9% | |
| |
|---|
| Median (13 companies) | 19.0% | 14.8% | 14.9% | 18.0% | 11.2% |
|---|
| Severstal PJSC ($SVST) | 31.0% | 23.5% | 29.9% | 34.4% | 40.4% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Mmc Norilsk Nickel ($MNOD) | 49.5% | 38.6% | 29.2% | 46.8% | |
| First Quantum Minerals ($FQM) | 47.7% | 80.0% | 38.1% | 39.9% | |
| Cheliabinsk Elektrolit Zink Plant ($CHZN) | 17.1% | 12.7% | 5.7% | 25.3% | |
| Novolipetsk Iron And Steel Corp ($NLMK) | 19.2% | 15.6% | 13.8% | 21.8% | |
| Aluminium Bahrain Bsc ($ALBH) | 28.6% | 18.5% | 18.4% | 21.6% | |
| |
|---|
| Median (15 companies) | 15.3% | 12.9% | 12.1% | 12.6% | 9.7% |
|---|
| Severstal PJSC ($SVST) | 22.5% | 14.9% | 19.3% | 26.4% | 32.4% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Base Resources Ltd ($BSE) | | | | 401.9% | 6.3% |
| First Quantum Minerals ($FQM) | 40.6% | 46.5% | 73.2% | 81.7% | |
| Mmc Norilsk Nickel ($MNOD) | 15.6% | 22.3% | 17.1% | 10.8% | |
| Cheliabinsk Elektrolit Zink Plant ($CHZN) | 9.0% | 7.0% | 7.9% | 9.9% | |
| Vimetco Nv ($VICO) | | | | 8.8% | |
| |
|---|
| Median (15 companies) | 6.0% | 6.7% | 7.6% | 6.3% | 4.4% |
|---|
| Severstal PJSC ($SVST) | 10.2% | 9.5% | 10.3% | 8.4% | 6.4% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Zibao Metals Recycling Hldgs Ltd ($ZBO) | | 41.7% | 56.6% | 55.8% | 26.6% |
| Mmc Norilsk Nickel ($MNOD) | 32.4% | 21.8% | 14.2% | 34.1% | |
| Cheliabinsk Elektrolit Zink Plant ($CHZN) | 13.6% | 6.2% | -2.7% | 25.6% | |
| Novolipetsk Iron And Steel Corp ($NLMK) | 11.8% | 7.2% | 4.1% | 12.0% | |
| Aluminium Bahrain Bsc ($ALBH) | 15.6% | 5.4% | 5.6% | 9.3% | |
| |
|---|
| Median (15 companies) | 11.0% | 5.4% | 4.1% | 7.4% | 3.3% |
|---|
| Severstal PJSC ($SVST) | 21.3% | 10.3% | 9.6% | 17.7% | 30.3% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Ambrian ($AMBR) | 3,395.4x | | 42.6x | 176.1x | |
| Ezz Steel ($AEZD) | 3.4x | 4.8x | 3.6x | 19.4x | |
| Vimetco Nv ($VICO) | 5.4x | 7.7x | | 10.9x | |
| First Quantum Minerals ($FQM) | -0.3x | 0.0x | 2.5x | 4.0x | |
| OAO TMK ($TMKS) | 3.5x | 3.6x | 3.9x | 3.8x | |
| |
|---|
| Median (14 companies) | 3.0x | 2.0x | 2.1x | 1.2x | 3.6x |
|---|
| Severstal PJSC ($SVST) | 1.2x | 1.9x | 2.0x | 0.7x | 0.4x |
