Oriental Press Group reports 32.7% Net Income decline and 7.8% Revenue decline
19/06/2015 • About Oriental Press Group (
$18) • By InTwits
Oriental Press Group reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Oriental Press Group is a company in decline: FY2015 revenue growth was -7.8%, 5 years revenue CAGR was -3.3%
- Oriental Press Group has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.5%. At the same time it's in pair with industry average of 5.0%.
- CAPEX is quite volatile: 30.0 in FY2015, 27.9 in FY2014, 81.3 in FY2013, 17.3 in FY2012, 21.9 in FY2011
- The company has potentially unprofitable business model: ROIC is at 4.0%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Oriental Press Group ($18) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 1,589 | 1,505 | 1,457 | 1,436 | 1,325 | -7.8% |
| EBITDA | 327 | 143 | 187 | 210 | 184 | -12.3% |
| Net Income | 291 | 119 | 183 | 90 | 61 | -32.7% |
Balance Sheet
|
|---|
| Cash | 1,963 | 1,630 | 1,602 | 1,742 | 1,653 | -5.1% |
| Short Term Debt | 10 | 10 | 9 | 9 | 8 | -5.4% |
| Long Term Debt | 1 | 1 | 2 | 4 | 6 | 35.0% |
Cash flow
|
|---|
| Capex | 22 | 17 | 81 | 28 | 30 | 7.5% |
Ratios
|
|---|
| Revenue growth | 1.4% | -5.3% | -3.2% | -1.4% | -7.8% | |
| EBITDA growth | -6.6% | -56.2% | 30.3% | 12.6% | -12.3% | |
| EBITDA Margin | 20.6% | 9.5% | 12.8% | 14.6% | 13.9% | -0.7% |
| Net Income Margin | 18.3% | 7.9% | 12.5% | 6.3% | 4.6% | -1.7% |
| CAPEX, % of revenue | 1.4% | 1.2% | 5.6% | 1.9% | 2.3% | 0.3% |
| ROIC | 8.3% | 2.5% | 4.0% | 4.5% | 4.0% | -0.5% |
| ROE | 9.3% | 3.9% | 6.3% | 3.1% | 2.2% | -0.9% |
| Net Debt/EBITDA | -6.0x | -11.3x | -8.5x | -8.2x | -8.9x | -0.7x |
Revenue and profitability
The company's Revenue decreased on 7.8% in FY2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin surged on 10.3 pp from 46.3% to 56.6% in 2015.
Net Income marign decreased slightly on 1.7 pp from 6.3% to 4.6% in FY2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 2.3% in FY2015. CAPEX/Revenue increased slightly on 1.1 pp from 1.2% in FY2012 to 2.3% in FY2015. It's average level of CAPEX/Revenue for the last three years was 3.3%.
Return on investment
The company operates at low ROIC (3.96%) and ROE (2.18%). ROIC decreased slightly on 0.52 pp from 4.5% to 4.0% in FY2015. ROE decreased slightly on 0.90 pp from 3.1% to 2.2% in FY2015.
Leverage (Debt)
Company's Net Debt / EBITDA is -8.9x and Debt / EBITDA is 0.1x. Net Debt / EBITDA dropped on 0.7x from -8.2x to -8.9x in FY2015. Debt increased on 8.3% in FY2015 while cash decreased on 5.1% in FY2015.
Appendix 1: Peers in Media
Below we provide Oriental Press Group benchmarking against other companies in Media industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| CMMB Vision Holdings Ltd ($471) | | | 168.1% | 27.8% | |
| Culturecom Holdings Ltd ($343) | 4.7% | -24.2% | -7.7% | 16.4% | |
| Sing Pao Media Enterprises Ltd ($8010) | 20.7% | 15.3% | 26.9% | 9.7% | |
| Focus Media Network Ltd ($8112) | 23.7% | -10.6% | 34.6% | 5.6% | |
| Hong Kong Economic Times Holdings Ltd ($423) | 15.0% | 5.6% | 2.7% | 3.1% | |
| |
|---|
| Median (19 companies) | 9.9% | 4.5% | -1.8% | -4.3% | -9.5% |
|---|
| Oriental Press Group ($18) | | -5.3% | -3.2% | -1.4% | -7.8% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| I-CABLE Communications Ltd ($1097) | 95.6% | 94.8% | 94.7% | 94.1% | |
| Television Broadcasts Ltd ($511) | 65.3% | 62.9% | 60.9% | 59.0% | |
| Modern Media Holdings ($72) | 57.1% | 57.5% | 55.8% | 55.6% | |
| One Media Group Ltd ($426) | 52.0% | 57.3% | 56.7% | 54.5% | 52.7% |
| Focus Media Network Ltd ($8112) | 81.0% | 68.0% | 67.2% | 50.8% | |
| |
|---|
| Median (17 companies) | 45.7% | 38.5% | 39.5% | 36.1% | 38.6% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| SCMP Group Ltd ($583) | 26.9% | 23.5% | 20.5% | 218.1% | |
| Television Broadcasts Ltd ($511) | 45.2% | 43.2% | 42.3% | 37.3% | |
| Phoenix Satellite Television Holdings Ltd ($2008) | 29.8% | 30.1% | 31.1% | 24.6% | |
| One Media Group Ltd ($426) | 14.4% | 18.7% | 23.0% | 22.8% | 15.2% |
| Media Chinese International Ltd ($685) | 20.0% | 20.0% | 18.3% | 18.1% | 16.5% |
| |
|---|
| Median (19 companies) | 13.3% | 12.9% | 11.5% | 9.8% | 15.2% |
|---|
| Oriental Press Group ($18) | 20.6% | 9.5% | 12.8% | 14.6% | 13.9% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| SCMP Group Ltd ($583) | 3.6% | 7.0% | 5.3% | 52.2% | |
| Culturecom Holdings Ltd ($343) | 12.5% | 10.2% | 38.6% | 24.5% | |
| Phoenix Satellite Television Holdings Ltd ($2008) | 14.6% | 12.0% | 8.5% | 11.4% | |
| I-CABLE Communications Ltd ($1097) | 10.6% | 10.1% | 7.6% | 11.3% | |
| V1 Group Ltd ($82) | 1.4% | 1.9% | 3.2% | 10.1% | |
| |
|---|
| Median (19 companies) | 4.6% | 3.9% | 5.2% | 2.9% | 1.5% |
|---|
| Oriental Press Group ($18) | 1.4% | 1.2% | 5.6% | 1.9% | 2.3% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Media Chinese International Ltd ($685) | 18.7% | 18.6% | 17.8% | 18.4% | 15.6% |
| One Media Group Ltd ($426) | 17.1% | 25.6% | 21.8% | 16.0% | 8.9% |
| Television Broadcasts Ltd ($511) | 26.5% | 23.8% | 22.4% | 15.1% | |
| Phoenix Satellite Television Holdings Ltd ($2008) | 21.5% | 18.5% | 18.4% | 11.7% | |
| Modern Media Holdings ($72) | 23.8% | 20.6% | 10.4% | 9.3% | |
| |
|---|
| Median (19 companies) | 9.4% | 5.6% | 5.1% | 2.6% | 8.9% |
|---|
| Oriental Press Group ($18) | 8.3% | 2.5% | 4.0% | 4.5% | 4.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Tom Group Ltd ($2383) | | | | 8.1x | |
| Media Chinese International Ltd ($685) | -1.1x | -1.4x | 0.8x | 0.6x | 0.2x |
| I-CABLE Communications Ltd ($1097) | -2.0x | -4.0x | -0.8x | 0.2x | |
| Modern Media Holdings ($72) | -0.9x | -0.8x | -0.9x | 0.1x | |
| Next Media Ltd ($282) | 0.0x | 0.4x | 0.4x | -0.2x | -0.3x |
| |
|---|
| Median (13 companies) | -1.3x | -1.4x | -1.1x | -1.1x | 0.2x |
|---|
| Oriental Press Group ($18) | -6.0x | -11.3x | -8.5x | -8.2x | -8.9x |
