Over the last few years China Creative Home Group Ltd showed solid growth in fundamentals
01/04/2015 • About China Creative Home Group Ltd (
$1678) • By InTwits
Have you thought about China Creative Home Group Ltd as a growth stock? Its revenue performance, profitability and healthy financial model stands it out vs. other public companies on the market.
Growth story
China Creative Home Group Ltd showed fast growth in the last financial year. China Creative Home Group Ltd's revenue surged on 17.9% in FY2014. The growth also happened in EBITDA of 13.6% for the same period.
In the longer period China Creative Home Group Ltd showed fast revenue growth of 20.6% from 2011 to 2014 annualy. EBITDA surged on 19.9% from 2011 to 2014 annualy.
China Creative Home Group Ltd ($1678) financials for the last 5 years
| mln. CNY | 2010 | 2011 | 2012 | 2013 | 2014 |
|---|
| Revenue | 752 | 804 | 969 | 1,196 | 1,409 |
|---|
| Revenue growth, % | | 7.0% | 20.5% | 23.4% | 17.9% |
|---|
| Gross margin, % | 42.9% | 41.2% | 44.2% | 44.3% | 40.4% |
|---|
| SG&A, % | 7.89% | 9.72% | 9.96% | 11.9% | 10.1% |
|---|
| EBITDA | 272 | 266 | 349 | 404 | 459 |
|---|
| EBITDA growth, % | | -2.0% | 31.0% | 15.8% | 13.6% |
|---|
| EBITDA margin, % | 36.1% | 33.1% | 36.0% | 33.8% | 32.6% |
|---|
| Net Income | 219 | 218 | 262 | 303 | 355 |
|---|
| Net Income margin, % | 29.1% | 27.1% | 27.0% | 25.4% | 25.2% |
|---|
| |
| CAPEX | 172 | 27 | 12 | 28 | 592 |
|---|
| CAPEX/Revenue, % | 22.9% | 3.32% | 1.19% | 2.37% | 42.0% |
|---|
| Debt | 114 | 71 | 218 | 64 | 67 |
|---|
| Cash | 19 | 5 | 344 | 996 | 707 |
|---|
| Net Debt/EBITDA | 0.3x | 0.2x | -0.4x | -2.3x | -1.4x |
|---|
| |
| ROIC, % | | 37.6% | 38.8% | 28.1% | 23.6% |
|---|
| ROE, % | | 38.2% | 37.3% | 25.0% | 20.0% |
|---|
Profitability and return on investment
Despite revenue growth EBITDA margin declined slightly from 33.8% in FY2013 to 32.6% in FY2014. In the last 3 years China Creative Home Group Ltd's EBITDA margin decreased slightly on 0.500 pp from 33.1% in 2011 to 32.6% in 2014.
We call China Creative Home Group Ltd an attractive growth stock as together with the growth it delivers high ROIC at 23.6%. During the last three years it dropped - it was 37.6% in FY2011. Average ROIC for the last three years was 30.2%.
Net Income margin decreased slightly on 0.200 pp from 25.4% to 25.2% in 2014. In the longer period China Creative Home Group Ltd showed decline of 1.90 pp from 27.1% in 2011 to 25.2% in 2014.
China Creative Home Group Ltd operates at ROE of 20.0%. It's average ROE for the last three years was 27.5%.
Capital expenditures (CAPEX)
To this fast growth the company had to invest in CAPEX.In FY2014 China Creative Home Group Ltd had CAPEX/Revenue of 42.0%. CAPEX/Revenue surged on 38.7 pp from 3.32% in 2011 to 42.0% in 2014. For the last three years the average CAPEX/Revenue was 15.2%.
Leverage (Debt)
China Creative Home Group Ltd has negative net debt at -1.4x Net Debt/EBITDA - at the same time with high growth. If we look for the longer period the company's leverage dropped on 1.64x from 0.25x in 2011 to -1.40x in 2014.
Peers in Housewares
Below you can find China Creative Home Group Ltd benchmarking vs. other companies in Housewares 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, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top |
|---|
| China Strategic Holdings Ltd ($235) | | -24.1% | -39.2% | 1,832.6% | 281.4% |
| World Houseware Holdings Ltd ($713) | | 11.7% | -4.8% | -7.4% | -0.4% |
| |
|---|
| Median (2 companies) | | -6.2% | -22.0% | 912.6% | 140.5% |
|---|
| China Creative Home Group Ltd ($1678) | | 7.0% | 20.5% | 23.4% | 17.9% |
Top companies by Gross margin, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top |
|---|
| World Houseware Holdings Ltd ($713) | 11.7% | 8.8% | 13.1% | 10.3% | 10.8% |
| China Strategic Holdings Ltd ($235) | 19.8% | 43.3% | 11.4% | 11.7% | 7.4% |
| |
|---|
| Median (2 companies) | 15.8% | 26.1% | 12.2% | 11.0% | 9.1% |
|---|
| China Creative Home Group Ltd ($1678) | 42.9% | 41.2% | 44.2% | 44.3% | 40.4% |
Top companies by EBITDA margin, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top |
|---|
| World Houseware Holdings Ltd ($713) | 7.5% | 2.1% | 7.1% | 3.4% | 2.4% |
| China Strategic Holdings Ltd ($235) | -499.6% | -727.1% | -1,603.6% | -25.0% | -2.8% |
| |
|---|
| Median (2 companies) | -246.1% | -362.5% | -798.2% | -10.8% | -0.2% |
|---|
| China Creative Home Group Ltd ($1678) | 36.1% | 33.1% | 36.0% | 33.8% | 32.6% |
Top companies by CAPEX/Revenue, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top |
|---|
| World Houseware Holdings Ltd ($713) | 3.5% | 2.2% | 3.6% | 6.2% | 12.4% |
| China Strategic Holdings Ltd ($235) | 32.1% | 0.0% | 0.0% | 0.0% | 0.6% |
| |
|---|
| Median (2 companies) | 17.8% | 1.1% | 1.8% | 3.1% | 6.5% |
|---|
| China Creative Home Group Ltd ($1678) | 22.9% | 3.3% | 1.2% | 2.4% | 42.0% |
Top companies by ROIC, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top |
|---|
| China Strategic Holdings Ltd ($235) | -6.9% | -8.3% | -12.0% | -4.0% | -1.3% |
| World Houseware Holdings Ltd ($713) | 1.8% | -3.0% | 1.6% | -1.9% | -2.8% |
| |
|---|
| Median (2 companies) | -2.5% | -5.6% | -5.2% | -3.0% | -2.0% |
|---|
| China Creative Home Group Ltd ($1678) | | 37.6% | 38.8% | 28.1% | 23.6% |
Top companies by Net Debt / EBITDA
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top |
|---|
| World Houseware Holdings Ltd ($713) | 1.6x | 4.9x | 1.4x | 4.7x | 11.7x |
| |
|---|
| Median (1 company) | 1.6x | 4.9x | 1.4x | 4.7x | 11.7x |
|---|
| China Creative Home Group Ltd ($1678) | 0.3x | 0.2x | -0.4x | -2.3x | -1.4x |
