NZSE:NZR

Stock Analysis Report

New Zealand Refining

Executive Summary

The New Zealand Refining Company Limited, together with its subsidiaries, engages in the refining of crude oil and supply of refined petroleum products in New Zealand.

Snowflake

Fundamentals

Reasonable growth potential with adequate balance sheet.

Share Price & News

How has New Zealand Refining's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

3.0%

NZR

2.5%

NZ Oil and Gas

1.1%

NZ Market


1 Year Return

-14.8%

NZR

-10.3%

NZ Oil and Gas

19.1%

NZ Market

Return vs Industry: NZR underperformed the NZ Oil and Gas industry which returned -10.3% over the past year.

Return vs Market: NZR underperformed the NZ Market which returned 19.1% over the past year.


Shareholder returns

NZRIndustryMarket
7 Day3.0%2.5%1.1%
30 Day-1.4%-1.1%2.7%
90 Day-3.3%0.6%1.9%
1 Year-11.6%-14.8%-6.6%-10.3%24.3%19.1%
3 Year11.5%-5.5%15.5%3.1%55.8%35.5%
5 Year60.4%22.5%-11.1%-27.4%101.8%56.4%

Price Volatility Vs. Market

How volatile is New Zealand Refining's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is New Zealand Refining undervalued compared to its fair value and its price relative to the market?

5.5%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: NZR (NZ$2.07) is trading below our estimate of fair value (NZ$2.19)

Significantly Below Fair Value: NZR is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: NZR is poor value based on its PE Ratio (22.3x) compared to the Oil and Gas industry average (9.7x).

PE vs Market: NZR is poor value based on its PE Ratio (22.3x) compared to the NZ market (18.7x).


Price to Earnings Growth Ratio

PEG Ratio: NZR is poor value based on its PEG Ratio (1.1x)


Price to Book Ratio

PB vs Industry: NZR is good value based on its PB Ratio (0.9x) compared to the XO Oil and Gas industry average (1.3x).


Next Steps

Future Growth

How is New Zealand Refining forecast to perform in the next 1 to 3 years based on estimates from 3 analysts?

20.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: NZR's forecast earnings growth (20.3% per year) is above the savings rate (2.4%).

Earnings vs Market: NZR's earnings (20.3% per year) are forecast to grow faster than the NZ market (7% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: NZR's revenue (5.7% per year) is forecast to grow faster than the NZ market (4.2% per year).

High Growth Revenue: NZR's revenue (5.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: NZR's Return on Equity is forecast to be low in 3 years time (8%).


Next Steps

Past Performance

How has New Zealand Refining performed over the past 5 years?

-1.7%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: NZR has become profitable over the past 5 years, growing earnings by -1.7% per year.

Accelerating Growth: NZR's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: NZR had negative earnings growth (-28.6%) over the past year, making it difficult to compare to the Oil and Gas industry average (58.2%).


Return on Equity

High ROE: NZR's Return on Equity (3.9%) is considered low.


Return on Assets

ROA vs Industry: NZR's Return on Assets is below or equal to the Oil and Gas industry average last year.


Return on Capital Employed

ROCE Improving: NZR's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is New Zealand Refining's financial position?


Financial Position Analysis

Short Term Liabilities: NZR's short term assets (NZ$170.2M) do not cover its short term liabilities (NZ$225.5M)

Long Term Liabilities: NZR's short term assets (170.2M) do not cover its long term liabilities (407.9M)


Debt to Equity History and Analysis

Debt Level: NZR's debt to equity ratio (35.8%) is considered satisfactory

Reducing Debt: NZR's debt to equity ratio has reduced from 44.9% to 35.8% over the past 5 years.

Debt Coverage: NZR's debt is well covered by operating cash flow (44.2%).

Interest Coverage: NZR's interest payments on its debt are well covered by EBIT (4x coverage).


Balance Sheet

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

Debt Coverage by Assets: NZR's debt is not covered by short term assets (assets are 0.6x debt).


Next Steps

Dividend

What is New Zealand Refining's current dividend yield, its reliability and sustainability?

3.62%

Current Dividend Yield


Dividend Yield vs Market

company3.6%marketbottom25%3.0%markettop25%5.6%industryaverage4.6%forecastin3Years7.2%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: NZR's dividend (3.62%) is higher than the bottom 25% of dividend payers in the NZ market (3%).

High Dividend: NZR's dividend (3.62%) is low compared to the top 25% of dividend payers in the NZ market (5.56%).

Stable Dividend: NZR's dividend payments have been volatile in the past 10 years.

Growing Dividend: NZR's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (70.1%), NZR's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: NZR's dividends in 3 years are not forecast to be well covered by earnings (101% payout ratio).


Next Steps

Management

What is the CEO of New Zealand Refining's salary, the management and board of directors tenure and is there insider trading?

3.8yrs

Average management tenure


CEO

Mike Fuge 0

1.2yrs

Tenure

NZ$1,144,296

Compensation

Mr. Michael Fuge, also known as Mike, M. Com. (Hons), B.Eng. (Hons), MIPENZ, serves as Chief Executive Officer at The New Zealand Refining Company Limited since August 2018. Mr. Fuge served as the Chief Ex ...


CEO Compensation Analysis

Compensation vs. Market: Mike has recently become CEO, making it difficult to compare their total compensation against companies of similar size in the NZ market.

Compensation vs Earnings: Insufficient data to compare Mike's compensation with company performance.


Management Age and Tenure

3.8yrs

Average Tenure

Experienced Management: NZR's management team is considered experienced (3.8 years average tenure).


Board Age and Tenure

2.5yrs

Average Tenure

Experienced Board: NZR's board of directors are not considered experienced ( 2.5 years average tenure), which suggests a new board.


Insider Trading

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


Ownership Breakdown


Management Team

  • Denise Jensen

    CFO & Company Secretary

    • Tenure: 10.8yrs
  • Mike Fuge

    Chief Executive Officer

    • Tenure: 1.2yrs
    • Compensation: NZ$1.14m
  • Julian Young

    Chief Development Officer

    • Tenure: 0yrs
  • Greg McNeill

    Communications & External Affairs Manager

    • Tenure: 0yrs
  • Joe Akari

    Chief People & Capability Officer

    • Tenure: 3.8yrs

Board Members

  • Simon Allen (61yo)

    Independent Chairman

    • Tenure: 4.5yrs
    • Compensation: NZ$180.00k
  • Paul Zealand

    Independent Director

    • Tenure: 3.2yrs
    • Compensation: NZ$122.50k
  • Vanessa Cynthia Stoddart (48yo)

    Independent Director

    • Tenure: 6.4yrs
    • Compensation: NZ$115.00k
  • James Miller

    Independent Director

    • Tenure: 0.9yrs
  • Lindis Jones

    Director

    • Tenure: 1.6yrs
    • Compensation: NZ$58.97k
  • Riccardo Cavallo

    Director

    • Tenure: 2.5yrs
    • Compensation: NZ$75.00k
  • Deborah Boffa

    Director

    • Tenure: 2.2yrs
    • Compensation: NZ$75.00k

Company Information

The New Zealand Refining Company Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: The New Zealand Refining Company Limited
  • Ticker: NZR
  • Exchange: NZSE
  • Founded: 1961
  • Industry: Oil and Gas Refining and Marketing
  • Sector: Energy
  • Market Cap: NZ$646.255m
  • Shares outstanding: 312.20m
  • Website: https://www.refiningnz.com

Number of Employees


Location

  • The New Zealand Refining Company Limited
  • Private Bag 9024
  • Whangarei
  • 148
  • New Zealand

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
NZRNZSE (New Zealand Stock Exchange)YesOrdinary SharesNZNZDJan 1992
NZRF.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1992

Biography

The New Zealand Refining Company Limited, together with its subsidiaries, engages in the refining of crude oil and supply of refined petroleum products in New Zealand. The company operates through Oil Refi ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/20 10:30
End of Day Share Price2019/10/18 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


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.