Infinis Energy reports 130% CAPEX growth while 7.7% Revenue decline
29 Sep 2016 • About Infinis Energy (
$INFI) • By InTwits
Infinis Energy reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Infinis Energy is a company in decline: FY2016 revenue growth was -7.7%, 5 years revenue CAGR was -2.8%
- Infinis Energy has high CAPEX intensity: 5 year average CAPEX/Revenue was 30.3%. At the same time it's in pair with industry average of 31.0%.
- CAPEX is quite volatile: 94.1 in FY2016, 41.0 in FY2015, 38.7 in FY2014, 73.0 in FY2013, 51.6 in FY2012
- The company has potentially unprofitable business model: ROIC is at 3.5%
- It operates with medium-size leverage: Net Debt/EBITDA is 5.4x while industry average is 4.8x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Infinis Energy ($INFI) key annual financial indicators
| mln. £ | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 218.2 | 225.9 | 238.4 | 180.0 | 166.3 | -7.7% |
| Gross Profit | 97.5 | 101.7 | 109.2 | 81.3 | 76.4 | -6.0% |
| SG&A | 31.5 | 28.3 | 56.0 | 30.2 | 47.9 | 58.4% |
| EBITDA | 120.2 | 123.4 | 107.8 | 125.7 | 93.1 | -25.9% |
| Net Income | 12.0 | 8.9 | -11.8 | 20.7 | 11.4 | -44.9% |
Balance Sheet
|
|---|
| Cash | 121.0 | 47.1 | 81.1 | 75.4 | 48.8 | -35.3% |
| Short Term Debt | 30.7 | 11.0 | 17.6 | 19.4 | 203.9 | 951.6% |
| Long Term Debt | 490.1 | 557.2 | 610.8 | 590.8 | 347.9 | -41.1% |
Cash flow
|
|---|
| Capex | 51.6 | 73.0 | 38.7 | 41.0 | 94.1 | 129.6% |
Ratios
|
|---|
| Revenue growth | 14.0% | 3.5% | 5.5% | -24.5% | -7.7% | |
| EBITDA growth | 19.7% | 2.6% | -12.6% | 16.6% | -25.9% | |
| Gross Margin | 44.7% | 45.0% | 45.8% | 45.1% | 45.9% | 0.8% |
| EBITDA Margin | 55.1% | 54.6% | 45.2% | 69.8% | 56.0% | -13.8% |
| Net Income Margin | 5.5% | 3.9% | -4.9% | 11.5% | 6.8% | -4.6% |
| SG&A, % of revenue | 14.4% | 12.5% | 23.5% | 16.8% | 28.8% | 12.0% |
| CAPEX, % of revenue | 23.6% | 32.3% | 16.2% | 22.8% | 56.6% | 33.8% |
| ROIC | 4.6% | 5.0% | 3.0% | 5.2% | 3.5% | -1.6% |
| ROE | 3.1% | 2.5% | -3.7% | 6.9% | 6.5% | -0.4% |
| Net Debt/EBITDA | 3.3x | 4.2x | 5.1x | 4.3x | 5.4x | 1.1x |
Revenue and profitability
The company's Revenue decreased on 7.7% in FY2016. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 13.8 pp from 69.8% to 56.0% in FY2016.
Gross Margin increased slightly on 0.81 pp from 45.1% to 45.9% in FY2016. SG&A as a % of Revenue jumped on 12.0 pp from 16.8% to 28.8% in FY2016.
Net Income marign decreased on 4.6 pp from 11.5% to 6.8% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 Infinis Energy had CAPEX/Revenue of 56.6%. The company showed fast CAPEX/Revenue growth of 24.3 pp from 32.3% in FY2013 to 56.6% in FY2016. Average CAPEX/Revenue for the last three years was 31.9%.Battling declining revenue Infinis Energy made large investments to CAPEX (101% of EBITDA) but that didn't help at least in this year.
Return on investment
The company operates at low ROIC (3.53%) and ROE (6.46%). ROIC decreased slightly on 1.6 pp from 5.2% to 3.5% in FY2016. ROE showed almost no change in FY2016.
Leverage (Debt)
Debt level is 5.4x Net Debt / EBITDA and 5.9x Debt / EBITDA. Net Debt / EBITDA jumped on 1.1x from 4.3x to 5.4x in FY2016. Debt decreased on 9.6% in FY2016 while cash dropped on 35.3% in FY2016.
Appendix 1: Peers in Electricity
Below you can find Infinis Energy benchmarking vs. other companies in Electricity 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 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Ksk Power Ventur ($KSK) | | 2.5% | -14.5% | 13.8% | 76.4% |
| Good Energy Group ($GOOD) | 30.7% | 43.3% | 42.6% | 11.6% | |
| Societatea Comerciala De Dis Si Fur ($ELSA) | -2.2% | 2.5% | -6.3% | 9.1% | |
| Mosenergo AO ($AOMD) | -2.5% | -0.8% | 3.5% | 6.0% | |
| RusHydro OJSC ($HYDR) | -17.6% | 5.0% | 5.1% | 5.4% | |
| |
|---|
| Median (8 companies) | 7.2% | 2.5% | -4.0% | 5.7% | 76.4% |
|---|
| Infinis Energy ($INFI) | | 3.5% | 5.5% | -24.5% | -7.7% |
Top companies by Gross margin, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Renewable Energy Generation Ltd ($WIND) | 42.5% | 42.7% | 35.9% | 36.5% | |
| Good Energy Group ($GOOD) | 33.9% | 33.6% | 32.7% | 33.1% | |
| Datang Intl Power Generation ($DAT) | | | | 30.7% | |
| Ksk Power Ventur ($KSK) | 33.9% | 40.0% | 27.1% | 27.0% | 34.3% |
| |
|---|
| Median (4 companies) | 33.9% | 40.0% | 32.7% | 31.9% | 34.3% |
|---|
| Infinis Energy ($INFI) | 44.7% | 45.0% | 45.8% | 45.1% | 45.9% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Renewable Energy Generation Ltd ($WIND) | 24.4% | 23.0% | 10.5% | 125.2% | |
| Datang Intl Power Generation ($DAT) | 28.7% | 33.6% | 34.8% | 38.0% | |
| Ksk Power Ventur ($KSK) | 43.1% | 40.6% | 30.3% | 26.0% | 37.3% |
| Societatea Comerciala De Dis Si Fur ($ELSA) | 12.2% | 11.9% | 16.7% | 17.8% | |
| Public Power Corp S.A. ($PPCD) | 15.3% | 19.1% | 20.0% | 17.7% | |
| |
|---|
| Median (8 companies) | 14.1% | 17.2% | 16.7% | 17.7% | 37.3% |
|---|
| Infinis Energy ($INFI) | 55.1% | 54.6% | 45.2% | 69.8% | 56.0% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Renewable Energy Generation Ltd ($WIND) | 142.1% | 77.4% | 167.6% | 100.1% | |
| Ksk Power Ventur ($KSK) | 194.9% | 100.4% | 59.5% | 58.3% | 8.7% |
| Datang Intl Power Generation ($DAT) | 34.3% | 43.2% | 28.8% | 29.7% | |
| Good Energy Group ($GOOD) | 1.0% | 23.2% | 31.8% | 27.6% | |
| RusHydro OJSC ($HYDR) | 27.8% | 19.7% | 23.8% | 22.8% | |
| |
|---|
| Median (8 companies) | 20.6% | 21.4% | 26.3% | 25.2% | 8.7% |
|---|
| Infinis Energy ($INFI) | 23.6% | 32.3% | 16.2% | 22.8% | 56.6% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Societatea Comerciala De Dis Si Fur ($ELSA) | 3.2% | 4.0% | 6.5% | 7.9% | |
| Good Energy Group ($GOOD) | 10.8% | 12.2% | 7.0% | 5.8% | |
| Datang Intl Power Generation ($DAT) | 5.7% | 5.9% | 4.8% | 4.6% | |
| RusHydro OJSC ($HYDR) | -0.7% | 3.0% | 4.3% | 4.2% | |
| Public Power Corp S.A. ($PPCD) | 1.5% | 3.6% | 3.7% | 1.4% | |
| |
|---|
| Median (8 companies) | 2.9% | 3.6% | 4.0% | 2.8% | 4.4% |
|---|
| Infinis Energy ($INFI) | 4.6% | 5.0% | 3.0% | 5.2% | 3.5% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Ksk Power Ventur ($KSK) | 12.8x | 16.0x | 26.5x | 30.7x | 12.7x |
| Good Energy Group ($GOOD) | -0.1x | 1.5x | 5.7x | 7.8x | |
| Datang Intl Power Generation ($DAT) | 8.4x | 7.7x | 8.3x | 7.5x | |
| Public Power Corp S.A. ($PPCD) | 5.3x | 4.1x | 4.3x | 4.8x | |
| RusHydro OJSC ($HYDR) | 7.8x | 2.9x | 2.6x | 2.6x | |
| |
|---|
| Median (8 companies) | 6.6x | 2.2x | 5.0x | 3.7x | 12.7x |
|---|
| Infinis Energy ($INFI) | 3.3x | 4.2x | 5.1x | 4.3x | 5.4x |
