Banco Santander Sa reports 14.2% CAPEX decline and 3.1% Revenue decline
25 Jan 2017 • About Banco Santander Sa (
$BNC) • By InTwits
Banco Santander Sa reported 2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Banco Santander Sa is a company in decline: 2016 revenue growth was -3.1%, 5 years revenue CAGR was -2.6%
- Banco Santander Sa has medium CAPEX intensity: 5 year average CAPEX/Revenue was 6.7%. At the same time it's a lot of higher than industry average of 3.7%.
- CAPEX is quite volatile: 6,572 in 2016, 7,664 in 2015, 6,695 in 2014, 1,877 in 2013, 2,161 in 2012
- The company has potentially unprofitable business model: ROIC is at 2.0%
- It operates with high leverage: Net Debt/EBITDA is 3.8x while industry average is
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Banco Santander Sa ($BNC) key annual financial indicators
| mln. € | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 80,999 | 72,976 | 75,046 | 74,920 | 72,578 | -3.1% |
| Net Income | 2,295 | 4,175 | 5,816 | 5,966 | 6,204 | 4.0% |
Balance Sheet
|
|---|
| Cash | 118,488 | 77,103 | 69,428 | 77,751 | 76,454 | -1.7% |
| Short Term Debt | 102,224 | 109,397 | 155,369 | 175,373 | 149,398 | -14.8% |
| Long Term Debt | 224,207 | 191,616 | 214,021 | 226,160 | 228,869 | 1.2% |
Cash flow
|
|---|
| Capex | 2,161 | 1,877 | 6,695 | 7,664 | 6,572 | -14.2% |
Ratios
|
|---|
| Revenue growth | -2.2% | -9.9% | 2.8% | -0.2% | -3.1% | |
| Net Income Margin | 2.8% | 5.7% | 7.7% | 8.0% | 8.5% | 0.6% |
| CAPEX, % of revenue | 2.7% | 2.6% | 8.9% | 10.2% | 9.1% | -1.2% |
| ROIC | 0.6% | 1.1% | 1.7% | 1.9% | 2.0% | 0.1% |
| ROE | 3.1% | 5.9% | 7.7% | 7.1% | 6.9% | -0.1% |
Revenue and profitability
Banco Santander Sa's Revenue decreased on 3.1% in 2016.
Net Income marign increased slightly on 0.58 pp from 8.0% to 8.5% in 2016.
Capital expenditures (CAPEX) and working capital investments
In 2016 Banco Santander Sa had CAPEX/Revenue of 9.1%. Banco Santander Sa showed CAPEX/Revenue growth of 6.5 pp from 2.6% in 2013 to 9.1% in 2016. It's average CAPEX/Revenue for the last three years was 9.4%.
Return on investment
The company operates at low ROIC (1.97%) and ROE (6.93%). ROIC showed almost no change in 2016. ROE showed almost no change in 2016.
Leverage (Debt)
Debt decreased on 5.8% in 2016 while cash decreased slightly on 1.7% in 2016.
Appendix 1: Peers in Banks
Below we provide Banco Santander Sa benchmarking against other companies in Banks 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 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Kazkommertsbank JSC ($KKB) | | 6.0% | 16.3% | 41.4% | |
| Sberbank Of Russia ($SBER) | 37.2% | 25.1% | 23.4% | 27.4% | |
| Commercial Intl Bank(Egypt)S.A.E ($CBKD) | 37.6% | 23.7% | 18.9% | 26.8% | |
| Yapi Ve Kredi Bankasi As ($YKBD) | 14.9% | 4.8% | 19.7% | 25.3% | |
| Mcb Bank Ltd ($MCBS) | 3.0% | -1.7% | 19.4% | 22.4% | |
| |
|---|
| Median (43 companies) | 9.5% | 4.8% | 12.1% | 5.5% | 2.1% |
|---|
| Banco Santander Sa ($BNC) | | -9.9% | 2.8% | -0.2% | -3.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Banque Marocaine Du Comm Exterieur ($69IR) | 3.7% | 9.7% | 4.3% | 26.8% | |
| Lloyds Banking Group ($LLPC) | 8.0% | 8.9% | 13.1% | 13.6% | 14.5% |
| Guaranty Trust Bank ($GRTB) | 6.7% | 6.1% | 6.8% | 7.7% | |
| Diamond Bank ($DBPA) | 8.2% | 7.9% | 6.0% | 6.7% | |
| Banco Bilbao Vizcaya Argentaria Sa ($BVA) | 5.1% | 3.8% | 4.5% | 6.0% | |
| |
|---|
| Median (41 companies) | 2.2% | 2.8% | 2.1% | 2.5% | 1.9% |
|---|
| Banco Santander Sa ($BNC) | 2.7% | 2.6% | 8.9% | 10.2% | 9.1% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Commercial Intl Bank(Egypt)S.A.E ($CBKD) | 21.7% | 26.9% | 30.1% | 30.3% | |
| Guaranty Trust Bank ($GRTB) | 19.8% | 18.9% | 17.8% | 16.0% | |
| Mcb Bank Ltd ($MCBS) | 15.0% | 14.4% | 15.8% | 14.9% | |
| United Bank Ltd ($UBLS) | 11.7% | 11.8% | 13.8% | 12.6% | |
| Zenith Bank ($ZENB) | 19.0% | 17.6% | 15.0% | 11.2% | |
| |
|---|
| Median (43 companies) | 6.4% | 5.7% | 4.5% | 3.5% | 3.5% |
|---|
| Banco Santander Sa ($BNC) | 0.6% | 1.1% | 1.7% | 1.9% | 2.0% |
