Honworld Group Ltd's three year revenue growth was 82.8% and EBITDA growth was 108% per year
05/04/2015 • About Honworld Group Ltd (
$2226) • By InTwits
Honworld Group Ltd is an attractive growth stock in Food industry. It showed noticeble revenue performance in the last years among with attractive profitability and financial model.
Growth story
Honworld Group Ltd showed fast growth in the last financial year. The company's revenue surged on 26.0% in FY2014. The growth also happened in EBITDA of 25.8% for the same period.
In the longer period the company showed fast revenue growth of 82.8% from 2011 to 2014 annualy. EBITDA surged on 108% from 2011 to 2014 annualy.
Honworld Group Ltd ($2226) financials for the last 5 years
| mln. CNY | 2010 | 2011 | 2012 | 2013 | 2014 |
|---|
| Revenue | 36 | 109 | 337 | 530 | 668 |
|---|
| Revenue growth, % | | 201.7% | 207.9% | 57.3% | 26.0% |
|---|
| Gross margin, % | 36.9% | 42.2% | 57.2% | 59.0% | 57.8% |
|---|
| SG&A, % | 6.36% | 15.8% | 13.9% | 18.8% | 18.2% |
|---|
| EBITDA | 10 | 31 | 150 | 223 | 281 |
|---|
| EBITDA growth, % | | 198.7% | 381.7% | 49.4% | 25.8% |
|---|
| EBITDA margin, % | 28.6% | 28.4% | 44.4% | 42.1% | 42.0% |
|---|
| Net Income | 6 | 20 | 98 | 174 | 212 |
|---|
| Net Income margin, % | 17.3% | 18.5% | 29.2% | 32.8% | 31.7% |
|---|
| |
| CAPEX | 17 | 28 | 20 | 57 | 340 |
|---|
| CAPEX/Revenue, % | 48.0% | 25.3% | 6.02% | 10.8% | 50.8% |
|---|
| Debt | 68 | 146 | 216 | 233 | 418 |
|---|
| Cash | 1 | 10 | 2 | 44 | 217 |
|---|
| Net Debt/EBITDA | 6.5x | 4.4x | 1.4x | 0.8x | 0.7x |
|---|
| |
| ROIC, % | | 22.1% | 50.4% | 44.5% | 23.6% |
|---|
| ROE, % | | 79.1% | 116.6% | 81.1% | 27.3% |
|---|
Profitability and return on investment
Despite revenue growth EBITDA margin declined slightly from 42.1% in FY2013 to 42% in FY2014. In the last 3 years EBITDA margin surged on 13.6 pp from 28.4% in 2011 to 42% in 2014.
We call Honworld Group Ltd an attractive growth stock as together with the growth it delivers high ROIC at 23.6%. During the last three years it increased - it was 22.1% in FY2011. It's average ROIC for the last three years was 39.5%.
The company showed small Net Income margin decline of 1.10 pp from 32.8% to 31.7% in 2014. In the last 3 years the company showed fast Net Income margin growth of 13.2 pp from 18.5% in 2011 to 31.7% in 2014.
Honworld Group Ltd operates at ROE of 27.3%. It's average level of ROE for the last three years was 75.0%.
Capital expenditures (CAPEX)
To this fast growth the company had to invest in CAPEX.Honworld Group Ltd's CAPEX/Revenue was 50.8% in FY2014. Honworld Group Ltd's CAPEX/Revenue surged on 25.6 pp from 25.3% in 2011 to 50.8% in 2014. It's average level of CAPEX/Revenue for the last three years was 22.5%.
Leverage (Debt)
Having such a fast growth profile the company keeps low debt level at 0.7x Net Debt/EBITDA. If we look for the longer period Honworld Group Ltd's leverage dropped on 3.66x from 4.38x in 2011 to 0.72x in 2014.
Peers in Food
Below you can find Honworld Group Ltd benchmarking vs. other companies in Food 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 5 |
|---|
| Wealth Glory Holdings Ltd ($8269) | | 22.3% | -16.5% | -53.8% | 555.7% |
| Natural Dairy NZ Holdings Ltd ($462) | | 12.0% | -47.2% | 19.1% | 76.6% |
| China Modern Dairy Holdings Ltd ($1117) | | 88.8% | 50.7% | 96.1% | 52.8% |
| Asia Cassava Resources Holdings Ltd ($841) | | 1.2% | -3.0% | 99.6% | 32.6% |
| YuanShengTai Dairy Farm Ltd ($1431) | | 44,049.9% | 363.2% | 27.8% | 32.0% |
| |
|---|
| Median (33 companies) | | 17.4% | 9.4% | 5.6% | 0.4% |
|---|
| Honworld Group Ltd ($2226) | | 201.7% | 207.9% | 57.3% | 26.0% |
Top companies by Gross margin, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Shenguan Holdings Group Ltd ($829) | 60.6% | 61.9% | 58.2% | 58.5% | 54.9% |
| Yashili International Holdings Ltd ($1230) | 56.9% | 52.0% | 53.7% | 53.5% | 51.2% |
| Natural Dairy NZ Holdings Ltd ($462) | 3.6% | 16.3% | -13.7% | 27.5% | 48.8% |
| Christine International Holdings Ltd ($1210) | 50.5% | 51.3% | 50.2% | 49.7% | 47.2% |
| YuanShengTai Dairy Farm Ltd ($1431) | 33.5% | 34.5% | 37.8% | 42.6% | 45.7% |
| |
|---|
| Median (33 companies) | 19.5% | 18.1% | 16.8% | 19.7% | 19.8% |
|---|
| Honworld Group Ltd ($2226) | 36.9% | 42.2% | 57.2% | 59.0% | 57.8% |
Top companies by EBITDA margin, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Shenguan Holdings Group Ltd ($829) | 57.1% | 57.2% | 58.7% | 59.2% | 54.5% |
| YuanShengTai Dairy Farm Ltd ($1431) | 1,478.6% | 147.8% | 40.3% | 48.4% | 47.1% |
| China Modern Dairy Holdings Ltd ($1117) | 30.6% | 33.9% | 33.5% | 27.0% | 25.3% |
| Want Want China Holdings Ltd ($151) | 22.3% | 20.1% | 23.8% | 25.8% | 23.8% |
| First Pacific Co Ltd/Hong Kong ($142) | 24.1% | 25.1% | 20.8% | 15.6% | 14.0% |
| |
|---|
| Median (33 companies) | 9.3% | 8.5% | 7.8% | 6.5% | 7.4% |
|---|
| Honworld Group Ltd ($2226) | 28.6% | 28.4% | 44.4% | 42.1% | 42.0% |
Top companies by CAPEX/Revenue, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| YuanShengTai Dairy Farm Ltd ($1431) | 47,535.9% | 182.5% | 26.1% | 18.3% | 43.4% |
| Yashili International Holdings Ltd ($1230) | 2.6% | 3.6% | 8.2% | 7.1% | 20.1% |
| Vedan International Holdings Ltd ($2317) | 5.0% | 2.8% | 2.5% | 2.4% | 18.8% |
| China Modern Dairy Holdings Ltd ($1117) | 94.7% | 58.9% | 50.6% | | 18.7% |
| Imperial Pacific International Holdings Ltd ($1076) | 0.0% | 0.0% | 0.0% | 0.0% | 15.6% |
| |
|---|
| Median (33 companies) | 4.5% | 3.2% | 5.9% | 5.3% | 5.1% |
|---|
| Honworld Group Ltd ($2226) | 48.0% | 25.3% | 6.0% | 10.8% | 50.8% |
Top companies by ROIC, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Want Want China Holdings Ltd ($151) | 28.1% | 24.9% | 27.9% | 29.4% | 22.8% |
| Shenguan Holdings Group Ltd ($829) | 34.3% | 40.6% | 40.0% | 33.2% | 21.4% |
| Huisheng International Holdings Ltd ($1340) | | 63.0% | 31.9% | 23.7% | 16.3% |
| Asia Cassava Resources Holdings Ltd ($841) | 27.3% | 13.8% | 4.2% | 5.9% | 13.6% |
| Tenwow International Holdings Ltd ($1219) | | 20.3% | 19.7% | 15.7% | 12.8% |
| |
|---|
| Median (33 companies) | 10.6% | 12.1% | 7.6% | 5.9% | 5.5% |
|---|
| Honworld Group Ltd ($2226) | | 22.1% | 50.4% | 44.5% | 23.6% |
Top companies by Net Debt / EBITDA
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Beijing Jingkelong Co Ltd ($814) | | 3.4x | 5.0x | 4.8x | 5.3x |
| CP Lotus Corp ($121) | 4.4x | 2.3x | | 6.5x | 5.1x |
| DaChan Food Asia Ltd ($3999) | -0.5x | -0.3x | 0.1x | 1.3x | 4.8x |
| First Pacific Co Ltd/Hong Kong ($142) | 1.7x | 1.3x | 1.8x | 3.8x | 4.5x |
| China Modern Dairy Holdings Ltd ($1117) | 5.4x | 1.3x | 3.7x | 5.2x | 4.1x |
| |
|---|
| Median (26 companies) | -0.6x | -0.2x | -0.6x | 0.4x | 0.4x |
|---|
| Honworld Group Ltd ($2226) | 6.5x | 4.4x | 1.4x | 0.8x | 0.7x |
