Wood Group(John) EBITDA dropped on 53.3% in 2015 and Revenue dropped on 23.9%
23 Feb 2016 • About Wood Group(John) (
$WG.) • By InTwits
Wood Group(John) reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Wood Group(John) has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.1%. At the same time it's in pair with industry average of 12.2%.
- CAPEX is quite volatile: 42.1 in 2015, 248 in 2014, 50.2 in 2013, 6.2 in 2012, 35.9 in 2011
- The company has potentially unprofitable business model: ROIC is at 4.5%
- It operates with high leverage: Net Debt/EBITDA is 1.1x while industry average is -4.0x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Wood Group(John) ($WG.) key annual financial indicators
| mln. $ | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 5,667 | 6,118 | 5,753 | 6,574 | 5,001 | -23.9% |
| Gross Profit | 953 | 1,000 | 950 | 1,009 | 817 | -19.0% |
| SG&A | 720 | 536 | 441 | 542 | 547 | 1.0% |
| EBITDA | 233 | 464 | 509 | 620 | 289 | -53.3% |
| Net Income | 2,302 | 257 | 296 | 322 | 79 | -75.5% |
Balance Sheet
|
|---|
| Cash | 227 | 172 | 145 | 157 | 205 | 30.6% |
| Short Term Debt | 69 | 45 | 74 | 15 | 30 | 103.4% |
| Long Term Debt | 161 | 282 | 396 | 495 | 495 | 0.0% |
Cash flow
|
|---|
| Capex | 72 | 69 | 85 | 59 | 36 | -38.8% |
Ratios
|
|---|
| Revenue growth | 38.7% | 8.0% | -6.0% | 14.3% | -23.9% | |
| EBITDA growth | -9.3% | 98.9% | 9.7% | 21.8% | -53.3% | |
| Gross Margin | 16.8% | 16.3% | 16.5% | 15.4% | 16.3% | 1.0% |
| EBITDA Margin | 4.1% | 7.6% | 8.9% | 9.4% | 5.8% | -3.6% |
| Net Income Margin | 40.6% | 4.2% | 5.1% | 4.9% | 1.6% | -3.3% |
| SG&A, % of revenue | 12.7% | 8.8% | 7.7% | 8.2% | 10.9% | 2.7% |
| CAPEX, % of revenue | 1.3% | 1.1% | 1.5% | 0.9% | 0.7% | -0.2% |
| ROIC | 5.7% | 14.0% | 13.3% | 16.0% | 4.5% | -11.5% |
| ROE | 136.6% | 12.3% | 12.8% | 13.0% | 3.2% | -9.8% |
| Net Debt/EBITDA | 0.0x | 0.3x | 0.6x | 0.6x | 1.1x | 0.5x |
Revenue and profitability
The company's Revenue dropped on 23.9% in 2015. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 3.6 pp from 9.4% to 5.8% in 2015.
Gross Margin increased slightly on 0.99 pp from 15.4% to 16.3% in 2015. SG&A as a % of Revenue increased on 2.7 pp from 8.2% to 10.9% in 2015.
Net Income marign decreased on 3.3 pp from 4.9% to 1.6% in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 0.72% in 2015. CAPEX/Revenue showed almost no change from 2012 to 2015. It's average CAPEX/Revenue for the last three years was 1.0%.
Return on investment
The company operates at low ROIC (4.46%) and ROE (3.20%). ROIC dropped on 11.5 pp from 16.0% to 4.5% in 2015. ROE decreased on 9.8 pp from 13.0% to 3.2% in 2015.
Leverage (Debt)
Debt level is 1.1x Net Debt / EBITDA and 1.8x Debt / EBITDA. Net Debt / EBITDA surged on 0.5x from 0.6x to 1.1x in 2015. Debt increased on 3.0% in 2015 while cash surged on 30.6% in 2015.
Appendix 1: Peers in Oil Equipment, Services & Distribution
Below you can find Wood Group(John) benchmarking vs. other companies in Oil Equipment, Services & Distribution 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 |
|---|
| Schlumberger ($SCL) | | 12.9% | 8.5% | 7.3% | -27.0% |
| Eurasia Drilling Co Ltd ($EDCL) | 52.7% | 17.0% | 7.4% | -14.5% | |
| Greka Drilling Ltd ($GDL) | 80.3% | 39.0% | -49.9% | -20.0% | |
| Mycelx Technologies Corp ($MYX) | 45.4% | 96.5% | 73.9% | -36.5% | |
| Thalassa Hldgs Ltd ($THAL) | 500.9% | 476.9% | 118.1% | -49.2% | |
| |
|---|
| Median (5 companies) | 66.5% | 39.0% | 8.5% | -20.0% | -27.0% |
|---|
| Wood Group(John) ($WG.) | | 8.0% | -6.0% | 14.3% | -23.9% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Mycelx Technologies Corp ($MYX) | 46.9% | 53.3% | 56.9% | 52.3% | |
| Thalassa Hldgs Ltd ($THAL) | 98.7% | 35.3% | 30.4% | 42.6% | |
| Greka Drilling Ltd ($GDL) | 21.9% | 20.5% | 28.4% | 25.7% | |
| Eurasia Drilling Co Ltd ($EDCL) | 31.1% | 33.5% | 24.6% | 24.3% | |
| Schlumberger ($SCL) | 21.7% | 21.2% | 21.9% | 23.0% | 20.2% |
| |
|---|
| Median (5 companies) | 31.1% | 33.5% | 28.4% | 25.7% | 20.2% |
|---|
| Wood Group(John) ($WG.) | 16.8% | 16.3% | 16.5% | 15.4% | 16.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Eurasia Drilling Co Ltd ($EDCL) | 21.5% | 24.6% | 25.6% | 28.0% | |
| Schlumberger ($SCL) | 26.2% | 25.5% | 28.3% | 24.3% | 19.9% |
| Greka Drilling Ltd ($GDL) | 16.0% | 22.5% | 17.8% | 7.3% | |
| Thalassa Hldgs Ltd ($THAL) | | 13.2% | 16.1% | 4.3% | |
| Mycelx Technologies Corp ($MYX) | -40.2% | -9.7% | 11.0% | -30.3% | |
| |
|---|
| Median (5 companies) | 18.7% | 22.5% | 17.8% | 7.3% | 19.9% |
|---|
| Wood Group(John) ($WG.) | 4.1% | 7.6% | 8.9% | 9.4% | 5.8% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Thalassa Hldgs Ltd ($THAL) | 7.4% | 10.0% | 3.1% | 63.9% | |
| Mycelx Technologies Corp ($MYX) | 13.3% | 25.3% | 35.7% | 22.3% | |
| Eurasia Drilling Co Ltd ($EDCL) | 15.1% | 19.0% | 15.9% | 17.8% | |
| Schlumberger ($SCL) | 10.8% | 11.2% | 8.7% | 8.2% | 6.8% |
| Greka Drilling Ltd ($GDL) | 65.4% | 56.8% | 2.5% | 5.1% | |
| |
|---|
| Median (5 companies) | 13.3% | 19.0% | 8.7% | 17.8% | 6.8% |
|---|
| Wood Group(John) ($WG.) | 1.3% | 1.1% | 1.5% | 0.9% | 0.7% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Eurasia Drilling Co Ltd ($EDCL) | 20.3% | 23.8% | 22.8% | 20.9% | |
| Schlumberger ($SCL) | 15.3% | 15.7% | 17.3% | 14.3% | 5.4% |
| Thalassa Hldgs Ltd ($THAL) | 4.1% | 13.4% | 13.8% | -2.4% | |
| Greka Drilling Ltd ($GDL) | 10.5% | 5.2% | -0.3% | -2.9% | |
| Mycelx Technologies Corp ($MYX) | -27.9% | -9.4% | 7.3% | -19.3% | |
| |
|---|
| Median (5 companies) | 10.5% | 13.4% | 13.8% | -2.4% | 5.4% |
|---|
| Wood Group(John) ($WG.) | 5.7% | 14.0% | 13.3% | 16.0% | 4.5% |
Top companies by Net Debt / EBITDA
| Top | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Greka Drilling Ltd ($GDL) | -0.7x | 0.6x | 1.9x | 2.2x | |
| Schlumberger ($SCL) | 0.8x | 0.9x | 0.8x | 0.9x | 2.3x |
| Eurasia Drilling Co Ltd ($EDCL) | 0.4x | 0.5x | 0.3x | 0.8x | |
| Thalassa Hldgs Ltd ($THAL) | | -1.3x | -6.5x | -26.5x | |
| |
|---|
| Median (4 companies) | 0.4x | 0.6x | 0.8x | 0.9x | 2.3x |
|---|
| Wood Group(John) ($WG.) | 0.0x | 0.3x | 0.6x | 0.6x | 1.1x |
