Basf Se reports 22.7% Net Income decline and 5.2% Revenue decline
26 Feb 2016 • About Basf Se (
$BFA) • By InTwits
Basf Se reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Basf Se has medium CAPEX intensity: 5 year average CAPEX/Revenue was 6.4%. At the same time it's in pair with industry average of 7.4%.
- CAPEX is quite volatile: 11,423 in 2015, 5,206 in 2014, 4,233 in 2013, 7,433 in 2012, 10,845 in 2011
- The company has highly profitable business model: ROIC is at 13.5%
- It operates with medium-size leverage: Net Debt/EBITDA is 1.2x while industry average is 1.2x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Basf Se ($BFA) key annual financial indicators
| mln. € | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 73,497 | 72,129 | 73,973 | 74,326 | 70,449 | -5.2% |
| Gross Profit | 19,511 | 17,863 | 18,397 | 18,487 | 19,077 | 3.2% |
| SG&A | 8,638 | 8,806 | 8,792 | 8,852 | 9,491 | 7.2% |
| EBITDA | 12,019 | 9,653 | 10,291 | 10,862 | 10,770 | -0.8% |
| Net Income | 6,188 | 4,819 | 4,792 | 5,155 | 3,987 | -22.7% |
Balance Sheet
|
|---|
| Cash | 2,048 | 1,647 | 1,827 | 1,718 | 2,241 | 30.4% |
| Short Term Debt | 3,995 | 4,094 | 3,256 | 3,545 | 4,074 | 14.9% |
| Long Term Debt | 9,069 | 8,704 | 11,151 | 11,839 | 11,123 | -6.0% |
Cash flow
|
|---|
| Capex | 3,410 | 4,015 | 4,873 | 5,296 | 5,812 | 9.7% |
Ratios
|
|---|
| Revenue growth | 15.1% | -1.9% | 2.6% | 0.5% | -5.2% | |
| EBITDA growth | 7.0% | -19.7% | 6.6% | 5.5% | -0.8% | |
| Gross Margin | 26.5% | 24.8% | 24.9% | 24.9% | 27.1% | 2.2% |
| EBITDA Margin | 16.4% | 13.4% | 13.9% | 14.6% | 15.3% | 0.7% |
| Net Income Margin | 8.4% | 6.7% | 6.5% | 6.9% | 5.7% | -1.3% |
| SG&A, % of revenue | 11.8% | 12.2% | 11.9% | 11.9% | 13.5% | 1.6% |
| CAPEX, % of revenue | 4.6% | 5.6% | 6.6% | 7.1% | 8.2% | 1.1% |
| ROIC | 20.8% | 15.4% | 16.6% | 16.6% | 13.5% | -3.1% |
| ROE | 27.2% | 19.8% | 18.6% | 18.9% | 13.6% | -5.2% |
| Net Debt/EBITDA | 0.9x | 1.2x | 1.2x | 1.3x | 1.2x | -0.1x |
Revenue and profitability
Basf Se's Revenue decreased on 5.2% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased slightly on 0.67 pp from 14.6% to 15.3% in 2015.
Gross Margin increased on 2.2 pp from 24.9% to 27.1% in 2015. SG&A as a % of Revenue increased slightly on 1.6 pp from 11.9% to 13.5% in 2015.
Net Income marign decreased slightly on 1.3 pp from 6.9% to 5.7% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 Basf Se had CAPEX/Revenue of 8.2%. CAPEX/Revenue increased on 2.7 pp from 5.6% in 2012 to 8.2% in 2015. It's average level of CAPEX/Revenue for the last three years was 7.3%.The company invested a big chunk of EBITDA (54.0%) to CAPEX which didn't stop revenue from falling.
Return on investment
The company operates at good ROIC (13.48%) and ROE (13.62%). ROIC decreased on 3.1 pp from 16.6% to 13.5% in 2015. ROE decreased on 5.2 pp from 18.9% to 13.6% in 2015.
Leverage (Debt)
Debt level is 1.2x Net Debt / EBITDA and 1.4x Debt / EBITDA. Net Debt / EBITDA decreased on 0.1x from 1.3x to 1.2x in 2015. Debt decreased slightly on 1.2% in 2015 while cash surged on 30.4% in 2015.
Appendix 1: Peers in Chemicals
Below we provide Basf Se benchmarking against other companies in Chemicals 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 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Frutarom Industries ($FRUT) | 14.9% | 19.2% | 9.0% | 21.6% | |
| Phosagro OJSC ($PHOR) | 30.6% | 4.8% | -0.7% | 17.7% | |
| Halosource Inc ($HALO) | -14.9% | 10.3% | 21.0% | 11.6% | |
| Acron JSC ($AKRN) | 40.0% | 8.7% | -4.5% | 9.9% | |
| Uralkali PJSC ($URKA) | 105.7% | 13.0% | -15.9% | 7.1% | |
| |
|---|
| Median (9 companies) | 29.7% | 6.7% | -0.7% | 7.1% | 3.4% |
|---|
| Basf Se ($BFA) | | -1.9% | 2.6% | 0.5% | -5.2% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Uralkali PJSC ($URKA) | 74.6% | | 71.6% | 74.3% | |
| Phosagro OJSC ($PHOR) | 44.1% | 42.9% | 34.8% | 45.2% | |
| Halosource Inc ($HALO) | 34.8% | 32.9% | 40.7% | 44.8% | |
| Acron JSC ($AKRN) | 45.8% | 43.1% | 38.1% | 42.8% | |
| Frutarom Industries ($FRUT) | 36.4% | 36.6% | 38.1% | 39.1% | |
| |
|---|
| Median (9 companies) | 42.3% | 36.4% | 36.6% | 39.1% | 34.9% |
|---|
| Basf Se ($BFA) | 26.5% | 24.8% | 24.9% | 24.9% | 27.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Uralkali PJSC ($URKA) | 59.2% | | 44.5% | 48.6% | |
| Phosagro OJSC ($PHOR) | 35.2% | 32.9% | 22.9% | 30.5% | |
| Arab Potash Co ($APOD) | 51.0% | 47.2% | 36.3% | 27.7% | |
| Acron JSC ($AKRN) | 44.8% | 28.4% | 22.7% | 27.2% | |
| Croda International ($50GP) | | 27.2% | 27.6% | 26.7% | 27.7% |
| |
|---|
| Median (9 companies) | 25.8% | 21.6% | 22.7% | 26.7% | 15.2% |
|---|
| Basf Se ($BFA) | 16.4% | 13.4% | 13.9% | 14.6% | 15.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Phosagro OJSC ($PHOR) | 12.8% | 12.7% | 17.0% | 16.7% | |
| Acron JSC ($AKRN) | 16.6% | 22.7% | 21.3% | 15.4% | |
| Uralkali PJSC ($URKA) | 10.4% | | 12.5% | 9.8% | |
| Lg Chem ($LGCD) | 9.7% | 8.2% | 5.9% | 6.3% | 8.1% |
| Croda International ($50GP) | | 4.8% | 4.1% | 6.0% | 8.6% |
| |
|---|
| Median (9 companies) | 10.1% | 6.1% | 5.9% | 6.0% | 8.1% |
|---|
| Basf Se ($BFA) | 4.6% | 5.6% | 6.6% | 7.1% | 8.2% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Croda International ($50GP) | | 46.5% | 42.3% | 35.3% | 30.5% |
| Phosagro OJSC ($PHOR) | 32.4% | 28.5% | 15.0% | 21.6% | |
| Frutarom Industries ($FRUT) | 11.7% | 12.0% | 11.9% | 15.1% | |
| Uralkali PJSC ($URKA) | 23.7% | | | 13.2% | |
| Acron JSC ($AKRN) | 27.7% | 14.4% | 9.2% | 10.6% | |
| |
|---|
| Median (9 companies) | 24.1% | 14.4% | 12.0% | 10.6% | 11.6% |
|---|
| Basf Se ($BFA) | 20.8% | 15.4% | 16.6% | 16.6% | 13.5% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Acron JSC ($AKRN) | 1.2x | 1.6x | 2.4x | 2.8x | |
| Phosagro OJSC ($PHOR) | 0.4x | 0.8x | 1.8x | 2.5x | |
| Uralkali PJSC ($URKA) | 1.1x | | 2.8x | 1.8x | |
| Plastics Capital ($PLA) | 2.3x | 2.1x | 1.9x | 1.4x | 2.2x |
| Frutarom Industries ($FRUT) | 1.3x | 1.4x | 1.7x | 1.1x | |
| |
|---|
| Median (8 companies) | 1.1x | 0.8x | 1.7x | 1.3x | 0.9x |
|---|
| Basf Se ($BFA) | 0.9x | 1.2x | 1.2x | 1.3x | 1.2x |
