Arab Potash Co EBITDA surged on 40.9% in 2015 and EBITDA Margin surged on 11.9 pp from 27.7% to 39.6%
24 Mar 2016 • About Arab Potash Co (
$APOD) • By InTwits
Arab Potash Co reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Arab Potash Co has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.1%. At the same time it's a lot of higher than industry average of 107.0%.
- CAPEX is quite volatile: 3.4 in 2015, 5.4 in 2014, 10.2 in 2013, 2.5 in 2012, 9.2 in 2011
- The company has highly profitable business model: ROIC is at 16.7%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Arab Potash Co ($APOD) key annual financial indicators
| mln. JOD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 720.2 | 586.3 | 521.2 | 535.5 | 527.5 | -1.5% |
| Gross Profit | 401.8 | 300.7 | 183.3 | 140.5 | 213.4 | 51.9% |
| SG&A | | | | 41.5 | 0.0 | -99.9% |
| EBITDA | 367.0 | 276.6 | 189.0 | 148.4 | 209.1 | 40.9% |
| Net Income | 299.7 | 198.8 | 130.7 | 99.7 | 131.1 | 31.6% |
Balance Sheet
|
|---|
| Cash | 412.0 | 329.5 | 304.4 | 294.8 | 338.5 | 14.8% |
| Short Term Debt | 12.4 | 6.5 | 1.2 | 0.0 | 0.0 | 0.0% |
| Long Term Debt | 7.7 | 1.2 | 0.1 | 0.1 | 0.1 | -40.0% |
Cash flow
|
|---|
| Capex | 9.2 | 2.5 | 10.2 | 5.4 | 3.4 | -37.7% |
Ratios
|
|---|
| Revenue growth | 28.8% | -18.6% | -11.1% | 2.7% | -1.5% | |
| EBITDA growth | 62.3% | -24.6% | -31.7% | -21.5% | 40.9% | |
| Gross Margin | 55.8% | 51.3% | 35.2% | 26.2% | 40.5% | 14.2% |
| EBITDA Margin | 51.0% | 47.2% | 36.3% | 27.7% | 39.6% | 11.9% |
| Net Income Margin | 41.6% | 33.9% | 25.1% | 18.6% | 24.9% | 6.2% |
| SG&A, % of revenue | | | | 7.7% | 0.0% | -7.7% |
| CAPEX, % of revenue | 1.3% | 0.4% | 1.9% | 1.0% | 0.6% | -0.4% |
| ROIC | 32.2% | 21.2% | 13.5% | 9.8% | 16.7% | 6.8% |
| ROE | 32.7% | 20.1% | 14.1% | 11.4% | 15.0% | 3.6% |
| Net Debt/EBITDA | -1.1x | -1.2x | -1.6x | -2.0x | -1.6x | 0.4x |
Revenue and profitability
Arab Potash Co's Revenue decreased slightly on 1.5% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin jumped on 11.9 pp from 27.7% to 39.6% in 2015.
Gross Margin jumped on 14.2 pp from 26.2% to 40.5% in 2015. SG&A as a % of Revenue decreased on 7.7 pp from 7.7% to 0.0091% in 2015.
Net Income marign increased on 6.2 pp from 18.6% to 24.9% in 2015.
Capital expenditures (CAPEX) and working capital investments
Arab Potash Co's CAPEX/Revenue was 0.64% in 2015. Arab Potash Co showed almost no change in CAPEX/Revenue from 2012 to 2015. It's average level of CAPEX/Revenue for the last three years was 1.2%.
Return on investment
The company operates at good ROIC (16.67%) and ROE (14.96%). ROIC increased on 6.8 pp from 9.8% to 16.7% in 2015. ROE increased on 3.6 pp from 11.4% to 15.0% in 2015.
Leverage (Debt)
Debt level is -1.6x Net Debt / EBITDA and 0.0x Debt / EBITDA. Net Debt / EBITDA jumped on 0.4x from -2.0x to -1.6x in 2015. Debt dropped on 28.6% in 2015 while cash surged on 14.8% in 2015.
Appendix 1: Peers in Chemicals
Below we provide Arab Potash Co 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 |
|---|
| Phosagro OJSC ($PHOR) | | 4.8% | -0.7% | 17.7% | 54.1% |
| Plastics Capital ($PLA) | | -4.2% | -2.1% | 3.3% | 21.9% |
| Frutarom Industries ($FRUT) | | 19.2% | 9.0% | 21.6% | 6.5% |
| Croda International ($50GP) | | | 2.4% | -2.8% | 3.4% |
| Basf Se ($BFA) | | -1.9% | 2.6% | 0.5% | -5.2% |
| |
|---|
| Median (7 companies) | 72.8% | 6.7% | -0.5% | 7.1% | 3.4% |
|---|
| Arab Potash Co ($APOD) | | -18.6% | -11.1% | 2.7% | -1.5% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Phosagro OJSC ($PHOR) | 44.1% | 42.9% | 34.8% | 45.2% | 56.2% |
| Halosource Inc ($HALO) | 34.8% | 32.9% | 40.7% | 44.8% | 40.2% |
| Frutarom Industries ($FRUT) | 36.4% | 36.6% | 38.1% | 39.1% | 38.7% |
| Plastics Capital ($PLA) | 40.6% | 36.2% | 36.6% | 36.0% | 35.3% |
| Croda International ($50GP) | | 33.9% | 33.7% | 32.8% | 34.9% |
| |
|---|
| Median (7 companies) | 38.5% | 35.1% | 36.6% | 39.1% | 35.3% |
|---|
| Arab Potash Co ($APOD) | 55.8% | 51.3% | 35.2% | 26.2% | 40.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Phosagro OJSC ($PHOR) | 35.2% | 32.9% | 22.9% | 30.5% | 43.5% |
| Croda International ($50GP) | | 27.2% | 27.6% | 26.7% | 27.7% |
| Frutarom Industries ($FRUT) | 15.3% | 16.0% | 17.0% | 18.2% | 18.5% |
| Basf Se ($BFA) | 16.4% | 13.4% | 13.9% | 14.6% | 15.3% |
| Lg Chem ($LGCD) | 15.8% | 12.0% | 12.0% | 10.9% | 15.2% |
| |
|---|
| Median (7 companies) | 16.4% | 15.4% | 17.0% | 18.2% | 15.3% |
|---|
| Arab Potash Co ($APOD) | 51.0% | 47.2% | 36.3% | 27.7% | 39.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Phosagro OJSC ($PHOR) | 12.8% | 12.7% | 17.0% | 16.7% | 22.4% |
| Croda International ($50GP) | | 4.8% | 4.1% | 6.0% | 8.6% |
| Basf Se ($BFA) | 4.6% | 5.6% | 6.6% | 7.1% | 8.2% |
| Lg Chem ($LGCD) | 9.7% | 8.2% | 5.9% | 6.3% | 8.1% |
| Halosource Inc ($HALO) | 16.4% | 7.5% | 8.5% | 1.0% | 3.0% |
| |
|---|
| Median (7 companies) | 10.1% | 6.5% | 6.6% | 6.3% | 8.1% |
|---|
| Arab Potash Co ($APOD) | 1.3% | 0.4% | 1.9% | 1.0% | 0.6% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Phosagro OJSC ($PHOR) | 32.4% | 28.5% | 15.0% | 21.6% | 41.2% |
| Croda International ($50GP) | | 46.5% | 42.3% | 35.3% | 30.5% |
| Frutarom Industries ($FRUT) | 11.7% | 12.0% | 11.9% | 15.1% | 14.1% |
| Basf Se ($BFA) | 20.8% | 15.4% | 16.6% | 16.6% | 13.5% |
| Lg Chem ($LGCD) | 24.6% | 14.4% | 12.0% | 8.6% | 11.6% |
| |
|---|
| Median (7 companies) | 22.2% | 14.4% | 12.0% | 13.2% | 13.5% |
|---|
| Arab Potash Co ($APOD) | 32.2% | 21.2% | 13.5% | 9.8% | 16.7% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Acron JSC ($AKRN) | 1.2x | 1.6x | 2.4x | 2.8x | |
| Phosagro OJSC ($PHOR) | 0.4x | 0.8x | 1.8x | 2.5x | 1.3x |
| Uralkali PJSC ($URKA) | 1.1x | | 2.8x | 1.8x | |
| Plastics Capital ($PLA) | 2.3x | 2.1x | 1.9x | 1.4x | 2.2x |
| Basf Se ($BFA) | 0.9x | 1.2x | 1.2x | 1.3x | 1.2x |
| |
|---|
| Median (8 companies) | 1.1x | 1.2x | 1.7x | 1.3x | 1.2x |
|---|
| Arab Potash Co ($APOD) | -1.1x | -1.2x | -1.6x | -2.0x | -1.6x |
