ASX:RES

Stock Analysis Report

Resource Generation

Executive Summary

Resource Generation Limited, together with its subsidiaries, operates as a coal producer in South Africa.


Snowflake Analysis

Overvalued with weak fundamentals.


Similar Companies

Share Price & News

How has Resource Generation's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: RES's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-24.1%

RES

4.4%

AU Oil and Gas

0.3%

AU Market


1 Year Return

-64.8%

RES

-48.2%

AU Oil and Gas

-22.9%

AU Market

Return vs Industry: RES underperformed the Australian Oil and Gas industry which returned -48.2% over the past year.

Return vs Market: RES underperformed the Australian Market which returned -22.9% over the past year.


Shareholder returns

RESIndustryMarket
7 Day-24.1%4.4%0.3%
30 Day-37.1%-37.2%-25.3%
90 Day-53.7%-49.2%-29.9%
1 Year-64.8%-64.8%-46.1%-48.2%-19.4%-22.9%
3 Year-42.9%-42.9%-40.7%-48.0%-8.3%-20.8%
5 Year-38.0%-38.0%-40.0%-50.7%2.9%-20.3%

Price Volatility Vs. Market

How volatile is Resource Generation's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Resource Generation undervalued compared to its fair value and its price relative to the market?

0.23x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: Insufficient data to calculate RES's fair value to establish if it is undervalued.

Significantly Below Fair Value: Insufficient data to calculate RES's fair value to establish if it is undervalued.


Price To Earnings Ratio

PE vs Industry: RES is unprofitable, so we can't compare its PE Ratio to the Oil and Gas industry average.

PE vs Market: RES is unprofitable, so we can't compare its PE Ratio to the Australian market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate RES's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: RES is good value based on its PB Ratio (0.2x) compared to the AU Oil and Gas industry average (0.7x).


Next Steps

Future Growth

How is Resource Generation forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

15.1%

Forecasted Energy industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Resource Generation has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has Resource Generation performed over the past 5 years?

-8.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: RES is currently unprofitable.

Growing Profit Margin: RES is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: RES is unprofitable, and losses have increased over the past 5 years at a rate of -8.7% per year.

Accelerating Growth: Unable to compare RES's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: RES is unprofitable, making it difficult to compare its past year earnings growth to the Oil and Gas industry (-16%).


Return on Equity

High ROE: RES has a negative Return on Equity (-2.36%), as it is currently unprofitable.


Next Steps

Financial Health

How is Resource Generation's financial position?


Financial Position Analysis

Short Term Liabilities: RES's short term assets (A$1.6M) do not cover its short term liabilities (A$15.8M).

Long Term Liabilities: RES's short term assets (A$1.6M) do not cover its long term liabilities (A$89.2M).


Debt to Equity History and Analysis

Debt Level: RES's debt to equity ratio (85.9%) is considered high.

Reducing Debt: RES's debt to equity ratio has increased from 13.5% to 85.9% over the past 5 years.


Balance Sheet

Inventory Level: RES has a high level of physical assets or inventory.

Debt Coverage by Assets: RES's debt is not covered by short term assets (assets are 0x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: RES has less than a year of cash runway based on its current free cash flow.

Forecast Cash Runway: RES has less than a year of cash runway if free cash flow continues to grow at historical rates of 22.3% each year.


Next Steps

Dividend

What is Resource Generation's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate RES's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate RES's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if RES's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if RES's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of RES's dividend in 3 years as they are not forecast to pay a notable one for the Australian market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

4.0yrs

Average management tenure


CEO

Papi Radiala Molotsane (59yo)

2s

Tenure

AU$419,270

Compensation

Mr. Leapeetswe Rapula Radiala Molotsane, also known as Papi, B.Eng Tech, BSc, MSc, SEP served as the Chief Executive Officer of Telkom SA SOC Limited from September 1, 2005 to April 5, 2007. Mr. Molotsane  ...


CEO Compensation Analysis

Compensation vs Market: Papi's total compensation ($USD257.16K) is about average for companies of similar size in the Australian market ($USD245.34K).

Compensation vs Earnings: Papi's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Leapeetswe Radiala Molotsane
Interim MD2yrsAU$419.27kno data
Izak Van Der Bank
Chief Operating Officer3.67yrsAU$427.11k0.70% A$179.0k
Sechaba Selibe
Head of Marketing & Logisticsno dataAU$173.94k0.0052% A$1.3k
Hennie van den Aardweg
General Manager of Operations11.33yrsAU$445.82k0.61% A$156.2k
Bongi Ndimande
Head of Human Resources & Communitiesno datano datano data
Mandisa Zungu
Head of Environmentalno datano datano data
Michael Meintjes
Company Secretary4.33yrsAU$43.23kno data

4.0yrs

Average Tenure

58yo

Average Age

Experienced Management: RES's management team is considered experienced (4 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Leapeetswe Radiala Molotsane
Interim MD2yrsAU$419.27kno data
Gregory Hunter
Non-Executive Director0.83yrno datano data
Michael Gray
Independent Non-Executive Director1.33yrsAU$43.75kno data
Colin Gilligan
Independent Non-Executive Director4.33yrsAU$75.00kno data
Lulamile Xate
Non-Executive Chairman2.33yrsAU$71.00kno data
Konji Sebati
Independent Non-Executive Director4.33yrsAU$42.60kno data
Robert Croll
Lead Independent Non-Executive Director1.33yrsAU$42.60kno data
Manish Dahiya
Alternate Director0.83yrno datano data

1.8yrs

Average Tenure

55yo

Average Age

Experienced Board: RES's board of directors are not considered experienced ( 1.8 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Resource Generation Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Resource Generation Limited
  • Ticker: RES
  • Exchange: ASX
  • Founded:
  • Industry: Coal and Consumable Fuels
  • Sector: Energy
  • Market Cap: AU$25.575m
  • Shares outstanding: 581.24m
  • Website: https://www.resgen.com.au

Number of Employees


Location

  • Resource Generation Limited
  • Ironwood House
  • Ground Floor
  • Bryanston
  • Gauteng
  • 2191
  • South Africa

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
RESASX (Australian Securities Exchange)YesOrdinary SharesAUAUDOct 2003
RSGJSE (The Johannesburg Securities Exchange)YesOrdinary SharesZAZAROct 2003
54RDB (Deutsche Boerse AG)YesOrdinary SharesDEEUROct 2003

Biography

Resource Generation Limited, together with its subsidiaries, operates as a coal producer in South Africa. It owns interest in the Boikarabelo coal mine located in the Waterberg region of South Africa. The company was formerly known as Comdek Limited and changed its name to Resource Generation Limited in September 2008. Resource Generation Limited is based in Bryanston, South Africa. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/29 10:36
End of Day Share Price2020/03/27 00:00
Earnings2019/12/31
Annual Earnings2019/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.