Posco reports 13.6 pp EBITDA Margin decline from 13.6% to in 2019 in 2019
31 Jan 2020 • About Posco (
$PIDD) • By InTwits
Posco reported FY2019 financial results today. Here are the key drivers of the company's long term financial model: It operates with high leverage: Net Debt/EBITDA is 3.8x while industry average is 1.5x.
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Posco's Revenue decreased slightly on 0.94%. During FY2015-FY2019 Revenue growth topped in FY2017 at 14.3% and was decelerating since that time.
Gross Margin decreased on 2.6 pp from 12.3% to 9.7% in FY2019. During the last 5 years Gross Margin topped in FY2017 at 13.8% and was declining since that time.
Net Income margin showed almost no change in FY2019.
Management team
The company's CEO is Choi Jeong-Woo. Choi Jeong-Woo is a founder and has 1 year tenure with the company.
Financial and operational results
FY ended 30 Nov -0001
Posco ($PIDD) key annual financial indicators| mln. KRW | 2015 | 2016 | 2017 | 2018 | 2019 | 2019/2018 |
|---|
P&L
|
|---|
| Revenue | 58,192,345 | 53,083,513 | 60,655,100 | 64,977,777 | 64,366,800 | -0.9% |
| Gross Profit | 6,534,247 | 6,689,551 | 8,355,911 | 7,972,381 | 6,249,800 | -21.6% |
| SG&A | 3,525,085 | 3,316,457 | 3,191,013 | 2,032,956 | | |
| EBITDA | 5,628,290 | 6,058,172 | 7,919,254 | 8,810,229 | | |
| EBIT | | | | 5,542,600 | | |
| Interest expence | | | | 741,296 | | |
| Tax | | | | -1,670,757 | | |
| Net Income | 180,646 | 1,363,310 | 2,790,110 | 1,690,610 | 1,835,100 | 8.5% |
Balance Sheet
|
|---|
| Cash | 4,870,185 | 2,447,619 | 2,612,530 | 2,601,718 | | |
| Inventory | | | | 11,499,928 | | |
| Accounts Payable | | | | 4,006,135 | | |
| Short Term Debt | 12,397,908 | 10,219,330 | 11,292,279 | 10,299,771 | | |
| Long Term Debt | 12,863,608 | 12,600,077 | 9,864,396 | 10,004,253 | | |
Cash flow
|
|---|
| Capex | 2,560,244 | 2,324,112 | 2,287,580 | 2,135,550 | | |
| Dividends | | | | 723,934 | | |
Ratios
|
|---|
| Revenue growth | -10.6% | -8.8% | 14.3% | 7.1% | -0.9% | |
| EBITDA growth | -12.8% | 7.6% | 30.7% | 11.3% | | |
|
|---|
| Gross Margin | 11.2% | 12.6% | 13.8% | 12.3% | 9.7% | -2.6% |
| EBITDA Margin | 9.7% | 11.4% | 13.1% | 13.6% | |
| EBIT Margin | | | | 8.5% | |
| SG&A, % of revenue | 6.1% | 6.2% | 5.3% | 3.1% | | |
| Net Income Margin | 0.3% | 2.6% | 4.6% | 2.6% | 2.9% | 0.2% |
| CAPEX, % of revenue | 4.4% | 4.4% | 3.8% | 3.3% | | |
|
|---|
| ROIC | 3.3% | 4.0% | 6.6% | 8.0% | | |
| ROE | 0.4% | 3.2% | 6.4% | 3.8% | | |
| Net Debt/EBITDA | 3.6x | 3.4x | 2.3x | 2.0x | |
| Interest coverage ratio (ICR) | | | | 7.5x | |
| Interest expence / Average debt | | | | 3.7% | | |
Peers in Industrial Metals & Mining
Below you can find Posco benchmarking vs. other companies in Industrial Metals & Mining 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 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Norsk Hydro Asa ($NHY) | 12.6% | -6.5% | 33.3% | 45.9% | |
| Base Resources Ltd ($BSE) | 444.2% | 16.2% | -3.9% | 22.4% | |
| First Quantum Minerals ($FQM) | -29.1% | 6.5% | 23.8% | 19.8% | |
| Novolipetsk Iron And Steel Corp ($NLMK) | -23.0% | -4.6% | 31.8% | 19.7% | |
| Severstal PJSC ($SVST) | | -7.5% | 32.7% | 9.3% | -4.9% |
| |
|---|
| Median (7 companies) | -11.6% | -3.6% | 31.6% | 19.7% | -4.9% |
|---|
| Posco ($PIDD) | | -8.8% | 14.3% | 7.1% | -0.9% |
Top companies by Gross margin, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Severstal PJSC ($SVST) | 40.4% | 39.6% | 39.7% | 42.7% | 39.8% |
| Base Resources Ltd ($BSE) | 21.2% | 21.0% | 35.9% | 39.7% | |
| Novolipetsk Iron And Steel Corp ($NLMK) | 31.4% | 33.6% | 32.5% | 36.2% | |
| First Quantum Minerals ($FQM) | 11.4% | 12.7% | 10.1% | 24.7% | |
| Aluminium Bahrain Bsc ($ALBH) | 13.5% | 12.3% | 15.7% | 9.3% | |
| |
|---|
| Median (6 companies) | 20.5% | 21.0% | 27.9% | 30.5% | 39.8% |
|---|
| Posco ($PIDD) | 11.2% | 12.6% | 13.8% | 12.3% | 9.7% |
Top companies by EBITDA margin, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Base Resources Ltd ($BSE) | 37.7% | 35.8% | 50.9% | 54.9% | |
| First Quantum Minerals ($FQM) | 17.8% | 36.1% | 32.5% | 42.2% | |
| Severstal PJSC ($SVST) | 32.4% | 31.2% | 32.6% | 36.1% | 34.0% |
| Novolipetsk Iron And Steel Corp ($NLMK) | 24.3% | 25.4% | 26.4% | 29.8% | |
| Aluminium Bahrain Bsc ($ALBH) | 17.3% | 18.4% | 18.4% | 11.2% | |
| |
|---|
| Median (7 companies) | 17.3% | 20.7% | 24.0% | 29.8% | 34.0% |
|---|
| Posco ($PIDD) | 9.7% | 11.4% | 13.1% | 13.6% | |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| First Quantum Minerals ($FQM) | 72.5% | 56.0% | 60.9% | 65.2% | |
| Aluminium Bahrain Bsc ($ALBH) | 6.3% | 16.1% | 54.2% | 57.7% | |
| Base Resources Ltd ($BSE) | 6.3% | 2.9% | 4.5% | 55.8% | |
| Severstal PJSC ($SVST) | 6.4% | 8.4% | 7.1% | 7.6% | 14.2% |
| Novolipetsk Iron And Steel Corp ($NLMK) | 7.7% | 7.3% | 5.9% | 5.6% | |
| |
|---|
| Median (7 companies) | 6.3% | 6.7% | 6.3% | 7.6% | 14.2% |
|---|
| Posco ($PIDD) | 4.4% | 4.4% | 3.8% | 3.3% | |
Top companies by ROIC, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Severstal PJSC ($SVST) | 30.3% | 29.7% | 38.8% | 49.5% | 39.4% |
| Novolipetsk Iron And Steel Corp ($NLMK) | 15.7% | 17.5% | 22.3% | 34.5% | |
| Base Resources Ltd ($BSE) | 2.9% | 2.7% | 13.2% | 17.1% | |
| Norsk Hydro Asa ($NHY) | 8.7% | 6.6% | 11.8% | 7.6% | |
| First Quantum Minerals ($FQM) | -0.4% | 1.6% | 1.1% | 4.3% | |
| |
|---|
| Median (11 companies) | 6.8% | 5.5% | 10.1% | 6.0% | 18.6% |
|---|
| Posco ($PIDD) | 3.3% | 4.0% | 6.6% | 8.0% | |
Top companies by Net Debt / EBITDA
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Aluminium Bahrain Bsc ($ALBH) | -0.2x | -0.1x | 2.5x | 7.4x | |
| First Quantum Minerals ($FQM) | 10.5x | 4.5x | 5.2x | 3.9x | |
| Norsk Hydro Asa ($NHY) | 0.0x | -0.1x | 0.3x | 0.6x | |
| Base Resources Ltd ($BSE) | 4.4x | 3.7x | 1.4x | 0.5x | |
| Severstal PJSC ($SVST) | 0.4x | 0.5x | 0.4x | 0.4x | 0.6x |
| |
|---|
| Median (7 companies) | 1.0x | 0.6x | 0.7x | 0.5x | 0.6x |
|---|
| Posco ($PIDD) | 3.6x | 3.4x | 2.3x | 2.0x | |
