Rosneft OJSC reports 11.6% CAPEX growth while 6.3% Revenue decline
31 Mar 2016 • About Rosneft OJSC (
$ROSN) • By InTwits
Rosneft OJSC reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Rosneft OJSC has high CAPEX intensity: 5 year average CAPEX/Revenue was 12.9%. At the same time it's a lot of higher than industry average of 21.1%.
- CAPEX is quite volatile: 307,539 in FY2015, 496,108 in FY2014, 581,786 in FY2013, 412,991 in FY2012, 228,654 in FY2011
- The company has business model with average profitability: ROIC is at 10.3%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Rosneft OJSC ($ROSN) key annual financial indicators
| mln. RUB | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 2,647,000 | 2,987,000 | 4,546,000 | 5,376,000 | 5,038,000 | -6.3% |
| SG&A | 52,000 | 68,000 | 111,000 | 114,000 | 130,000 | 14.0% |
| EBITDA | 646,000 | 595,000 | 935,000 | 1,069,000 | 1,139,000 | 6.5% |
| Net Income | 316,000 | 363,000 | 549,000 | 348,000 | 355,000 | 2.0% |
Balance Sheet
|
|---|
| Cash | 166,000 | 299,000 | 275,000 | 216,000 | 559,000 | 158.8% |
| Short Term Debt | 135,000 | 131,000 | 682,000 | 1,055,000 | 936,000 | -11.3% |
| Long Term Debt | 601,000 | 845,000 | 1,684,000 | 2,190,000 | 2,283,000 | 4.2% |
Cash flow
|
|---|
| Capex | 391,000 | 473,000 | 560,000 | 533,000 | 595,000 | 11.6% |
Ratios
|
|---|
| Revenue growth | 40.7% | 12.8% | 52.2% | 18.3% | -6.3% | |
| EBITDA growth | 11.0% | -7.9% | 57.1% | 14.3% | 6.5% | |
| EBITDA Margin | 24.4% | 19.9% | 20.6% | 19.9% | 22.6% | 2.7% |
| Net Income Margin | 11.9% | 12.2% | 12.1% | 6.5% | 7.0% | 0.6% |
| SG&A, % of revenue | 2.0% | 2.3% | 2.4% | 2.1% | 2.6% | 0.5% |
| CAPEX, % of revenue | 14.8% | 15.8% | 12.3% | 9.9% | 11.8% | 1.9% |
| ROIC | 15.0% | 11.8% | 11.1% | 9.4% | 10.3% | 0.9% |
| ROE | 16.7% | 16.8% | 20.3% | 11.6% | 12.3% | 0.7% |
| Net Debt/EBITDA | 0.9x | 1.1x | 2.2x | 2.8x | 2.3x | -0.5x |
Revenue and profitability
The company's Revenue decreased on 6.3% in 2015. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased on 2.7 pp from 19.9% to 22.6% in 2015.
SG&A as a % of Revenue showed almost no change in 2015.
Net Income marign increased slightly on 0.57 pp from 6.5% to 7.0% in 2015.
Capital expenditures (CAPEX) and working capital investments
Rosneft OJSC's CAPEX/Revenue was 11.8% in 2015. The company's CAPEX/Revenue decreased on 4.0 pp from 15.8% in 2012 to 11.8% in 2015. It's average CAPEX/Revenue for the last three years was 11.3%.Battling declining revenue Rosneft OJSC invested a large share of EBITDA (52.2%) to CAPEX but that didn't help at least in this year.
Return on investment
The company operates at good ROE (12.33%) while ROIC is low (10.26%). ROIC increased slightly on 0.87 pp from 9.4% to 10.3% in 2015. ROE increased slightly on 0.73 pp from 11.6% to 12.3% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 2.3x and Debt / EBITDA is 2.8x. Net Debt / EBITDA dropped on 0.5x from 2.8x to 2.3x in 2015. Debt decreased slightly on 0.80% in 2015 while cash jumped on 159% in 2015.
Appendix 1: Peers in Oil & Gas Producers
Below you can find Rosneft OJSC benchmarking vs. other companies in Oil & Gas Producers 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 |
|---|
| Cadogan Petroleum ($CAD) | 38.9% | -46.1% | 0.3% | 764.9% | |
| Parkmead Group(The) ($PMG) | | -21.3% | 38.0% | 505.8% | -24.4% |
| Caza Oil & Gas Inc ($CAZA) | | 21.5% | 67.0% | 178.3% | -22.2% |
| Nighthawk Energy ($HAWK) | -57.5% | 75.5% | 1,533.7% | 81.8% | |
| Iofina ($IOF) | 13.4% | 17.1% | 2.9% | 29.7% | |
| |
|---|
| Median (35 companies) | 26.0% | 17.1% | 3.6% | -0.8% | -19.2% |
|---|
| Rosneft OJSC ($ROSN) | | 12.8% | 52.2% | 18.3% | -6.3% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Bankers Petroleum Ltd ($BNK) | 77.9% | 77.5% | 81.1% | 80.8% | 72.2% |
| Oil & Gas Development Co ($OGDC) | 66.0% | 69.9% | 70.9% | 68.5% | 62.7% |
| Nighthawk Energy ($HAWK) | 14.5% | 38.8% | 66.8% | 58.1% | |
| Tethys Petroleum Limited ($TPL) | -4.2% | 14.7% | 28.9% | 46.2% | -76.0% |
| Volga Gas ($VGAS) | 45.5% | | | 42.9% | |
| |
|---|
| Median (23 companies) | 16.6% | 17.7% | 20.0% | 15.1% | 10.4% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Great Eastern Energy Corp ($GEEC) | 48.7% | 61.2% | 64.1% | 70.4% | 66.5% |
| Oil & Gas Development Co ($OGDC) | 67.6% | 73.7% | 65.9% | 69.3% | 62.4% |
| Bankers Petroleum Ltd ($BNK) | 51.4% | 53.3% | 59.4% | 68.3% | 38.5% |
| Jubilant Energy N.V. ($JUB) | -250.4% | 23.7% | 60.9% | 67.6% | 28.7% |
| Nighthawk Energy ($HAWK) | -358.5% | -80.7% | 72.2% | 57.7% | |
| |
|---|
| Median (36 companies) | 9.3% | 16.2% | 17.4% | 15.9% | 11.5% |
|---|
| Rosneft OJSC ($ROSN) | 24.4% | 19.9% | 20.6% | 19.9% | 22.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Jubilant Energy N.V. ($JUB) | 301.5% | 322.7% | 481.7% | 208.5% | 5.9% |
| Caza Oil & Gas Inc ($CAZA) | 430.1% | 249.9% | 352.9% | 177.4% | 15.5% |
| Ithaca Energy Inc ($IAE) | 160.2% | 95.1% | 83.4% | 103.5% | 42.8% |
| Tethys Petroleum Limited ($TPL) | 182.8% | 52.0% | 64.4% | 95.2% | 37.5% |
| Ruspetro ($RPO) | 83.5% | 139.8% | 55.2% | 77.2% | |
| |
|---|
| Median (37 companies) | 13.9% | 17.7% | 24.6% | 17.2% | 16.8% |
|---|
| Rosneft OJSC ($ROSN) | 14.8% | 15.8% | 12.3% | 9.9% | 11.8% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Oil & Gas Development Co ($OGDC) | 41.2% | 46.7% | 40.4% | 39.7% | 24.3% |
| Haike Chemical Group Ltd ($HAIK) | 7.7% | 0.7% | 1.0% | 31.4% | |
| Nighthawk Energy ($HAWK) | -5.1% | -3.9% | 19.6% | 23.1% | |
| Novatek OAO ($NVTK) | 47.4% | 21.7% | 29.0% | 21.2% | 19.4% |
| Bankers Petroleum Ltd ($BNK) | 19.7% | 17.4% | 20.8% | 20.8% | -0.2% |
| |
|---|
| Median (38 companies) | 5.4% | 4.6% | 5.8% | 5.3% | 2.5% |
|---|
| Rosneft OJSC ($ROSN) | 15.0% | 11.8% | 11.1% | 9.4% | 10.3% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Jubilant Energy N.V. ($JUB) | | 77.9x | 38.8x | 44.6x | 192.7x |
| Ruspetro ($RPO) | | 369.1x | 34.8x | 27.9x | |
| Bg Group ($BG.) | 1.2x | 1.3x | 1.7x | 11.7x | 1.5x |
| President Energy ($PPC) | | | | 9.9x | |
| Edge Resources Inc ($EDG) | | | | 8.0x | 7.6x |
| |
|---|
| Median (27 companies) | 0.5x | 0.4x | 0.7x | 1.3x | 1.8x |
|---|
| Rosneft OJSC ($ROSN) | 0.9x | 1.1x | 2.2x | 2.8x | 2.3x |
