Aluminium Bahrain Bsc reports 91.0% Net Income decline in 2019 while 13.0% Revenue growth
13 Feb 2020 • About Aluminium Bahrain Bsc (
$ALBH) • By InTwits
Aluminium Bahrain Bsc reported 2019 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Aluminium Bahrain Bsc has high CAPEX intensity: 5 year average CAPEX/Revenue was 32.7%. At the same time it's a lot of higher than industry average of 15.7%.
- CAPEX is quite volatile: 299 BHDm in 2019, 526 BHDm in 2018, 465 BHDm in 2017, 108 BHDm in 2016, 49 BHDm in 2015
- The company has potentially unprofitable business model: ROIC is 1.2%
- It operates with high leverage: Net Debt/EBITDA is 8.9x while industry average is 1.9x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Aluminium Bahrain Bsc's Revenue jumped on 13.0%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 3.0 pp from 36.9% to 40.0% in 2019. During 2015-2019 EBITDA Margin topped in 2017 at 18.4% and was declining since that time.
Gross Margin decreased slightly on 0.56 pp from 9.3% to 8.8% in 2019. SG&A as a % of Revenue increased slightly on 0.80 pp from 5.1% to 5.9% in 2019.
Net Income margin decreased on 6.0 pp from 6.6% to 0.52% in 2019.
Investments (CAPEX, working capital and M&A)
In 2019 the company had CAPEX/Revenue of 29.1%. The company's CAPEX/Revenue surged on 12.9 pp from 16.1% in 2016 to 29.1% in 2019. It's average level of CAPEX/Revenue for the last three years was 47.0%. To secure its fast growth the company made large investments to CAPEX (287% of EBITDA). During 2015-2019 CAPEX as a % of Revenue topped in 2018 at 57.7%.
Return on investment
The company operates at low ROIC (1.2%) and ROE (0.5%). ROIC decreased slightly on 0.94 pp from 2.1% to 1.2% in 2019. ROE decreased on 5.1 pp from 5.6% to 0.50% in 2019.
Leverage (Debt)
Debt level is 8.9x Net Debt / EBITDA and 9.7x Debt / EBITDA. Net Debt / EBITDA jumped on 1.4x from 7.4x to 8.9x in 2019. Debt surged on 17.2% while cash dropped on 21.7%. Net Debt/EBITDA grew at 2.6x per annum in the last 5 years.
Aluminium Bahrain Bsc has short term refinancing risk: cash is only 53.2% of short term debt.
Valuation and dividends
The company's trades at EV/EBITDA 9.1x and P/E 3.7x.
Management team
The company's CEO Ali Al Baqali is a founder and has spent 0 years with the company. The company's CFO Bryan Harris has spent 0 years with the company.
Financial and operational results
FY ended 31 Dec 2019
Aluminium Bahrain Bsc ($ALBH) key annual financial indicators| mln. BHD | 2015 | 2016 | 2017 | 2018 | 2019 | 2019/2018 |
|---|
P&L
|
|---|
| Revenue | 767 | 670 | 858 | 911 | 1,029 | 13.0% |
| Gross Profit | 103 | 82 | 135 | 85 | 90 | 6.1% |
| SG&A | 45 | 34 | 44 | 46 | 61 | 30.7% |
| EBITDA | 132 | 123 | 158 | 102 | 104 | 2.6% |
| EBIT | | | | 37 | | |
| Interest expence | | | | 1 | | |
| Tax | | | | 1 | | |
| Net Income | 60 | 48 | 92 | 60 | 5 | -91.0% |
Balance Sheet
|
|---|
| Cash | 116 | 66 | 77 | 104 | 81 | -21.7% |
| Inventory | | | | 266 | | |
| Short Term Debt | 56 | 45 | 22 | 75 | 153 | 105.2% |
| Long Term Debt | 33 | 6 | 454 | 786 | 856 | 8.9% |
Cash flow
|
|---|
| Capex | 49 | 108 | 465 | 526 | 299 | -43.1% |
| Dividends | | | | 37 | | |
Ratios
|
|---|
| Revenue growth | -6.7% | -12.6% | 28.1% | 6.2% | 13.0% | |
| EBITDA growth | -25.5% | -7.2% | 28.7% | -35.7% | 2.6% | |
|
|---|
| Gross Margin | 13.5% | 12.3% | 15.7% | 9.3% | 8.8% | -0.6% |
| EBITDA Margin | 17.3% | 18.4% | 18.4% | 11.2% | 10.1% | -1.0% |
| EBIT Margin | | | | 4.1% | |
| SG&A, % of revenue | 5.8% | 5.0% | 5.1% | 5.1% | 5.9% | 0.8% |
| Net Income Margin | 7.8% | 7.2% | 10.8% | 6.6% | 0.5% | -6.0% |
| CAPEX, % of revenue | 6.3% | 16.1% | 54.2% | 57.7% | 29.1% | -28.6% |
|
|---|
| ROIC | 5.6% | 4.9% | 7.0% | 2.1% | 1.2% | -0.9% |
| ROE | 6.4% | 5.0% | 9.1% | 5.6% | 0.5% | -5.1% |
| Net Debt/EBITDA | -0.2x | -0.1x | 2.5x | 7.4x | 8.9x | 1.4x |
| Interest expence / Average debt | | | | 0.1% | | |
Peers in Industrial Metals & Mining
Below you can find Aluminium Bahrain Bsc 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 ($NHY) | | -6.5% | 33.3% | 45.9% | -6.0% |
| Base Resources Ltd ($BSE) | 444.2% | 16.2% | -3.9% | 22.4% | |
| First Quantum Minerals ($FQM) | | 6.5% | 23.8% | 19.8% | 2.5% |
| Novolipetsk Iron And Steel Corp ($NLMK) | | -4.6% | 31.8% | 19.7% | -12.4% |
| Severstal PJSC ($SVST) | | -7.5% | 32.7% | 9.3% | -4.9% |
| |
|---|
| Median (7 companies) | -11.6% | -3.6% | 31.6% | 19.7% | -4.9% |
|---|
| Aluminium Bahrain Bsc ($ALBH) | | -12.6% | 28.1% | 6.2% | 13.0% |
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 ($NLMK) | 31.4% | 33.6% | 32.5% | 36.2% | 30.8% |
| First Quantum Minerals ($FQM) | 11.4% | 12.7% | 10.1% | 24.7% | 19.4% |
| Posco ($PIDD) | 11.2% | 12.6% | 13.8% | 12.3% | 9.7% |
| |
|---|
| Median (6 companies) | 20.5% | 21.0% | 27.9% | 30.5% | 25.1% |
|---|
| Aluminium Bahrain Bsc ($ALBH) | 13.5% | 12.3% | 15.7% | 9.3% | 8.8% |
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% | 34.0% |
| 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% | 24.3% |
| Posco ($PIDD) | 9.7% | 11.4% | 13.1% | 13.6% | |
| |
|---|
| Median (7 companies) | 14.6% | 19.1% | 24.0% | 29.8% | 29.1% |
|---|
| Aluminium Bahrain Bsc ($ALBH) | 17.3% | 18.4% | 18.4% | 11.2% | 10.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| First Quantum Minerals ($FQM) | 72.5% | 56.0% | 60.9% | 65.2% | 45.3% |
| Base Resources Ltd ($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% | 10.2% |
| Norsk Hydro Asa ($NHY) | 6.0% | 8.4% | 6.7% | 4.5% | 5.8% |
| |
|---|
| Median (7 companies) | 6.3% | 5.9% | 5.9% | 5.6% | 12.2% |
|---|
| Aluminium Bahrain Bsc ($ALBH) | 6.3% | 16.1% | 54.2% | 57.7% | 29.1% |
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% | 23.4% |
| Base Resources Ltd ($BSE) | 2.9% | 2.7% | 13.2% | 17.1% | |
| Posco ($PIDD) | 3.3% | 4.0% | 6.6% | 8.0% | |
| Norsk Hydro Asa ($NHY) | 8.7% | 6.6% | 11.8% | 7.6% | 0.4% |
| |
|---|
| Median (11 companies) | 6.7% | 5.5% | 10.1% | 7.8% | 2.4% |
|---|
| Aluminium Bahrain Bsc ($ALBH) | 5.6% | 4.9% | 7.0% | 2.1% | 1.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| First Quantum Minerals ($FQM) | 10.5x | 4.5x | 5.2x | 3.9x | 5.6x |
| Posco ($PIDD) | 3.6x | 3.4x | 2.3x | 2.0x | |
| Norsk Hydro Asa ($NHY) | 0.0x | -0.1x | 0.3x | 0.6x | 1.3x |
| Base Resources Ltd ($BSE) | 4.4x | 3.7x | 1.4x | 0.5x | |
| Severstal PJSC ($SVST) | 0.4x | 0.5x | 0.4x | 0.4x | 0.6x |
| |
|---|
| Median (7 companies) | 1.1x | 0.9x | 0.7x | 0.5x | 1.0x |
|---|
| Aluminium Bahrain Bsc ($ALBH) | -0.2x | -0.1x | 2.5x | 7.4x | 8.9x |
