Skyworth Digital Holdings Ltd Net Income jumped on 149% in 2015 and EBITDA Margin increased on 5.6 pp from 5.7% to 11.3%
19/06/2015 • About Skyworth Digital Holdings Ltd (
$751) • By InTwits
Skyworth Digital Holdings Ltd reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Skyworth Digital Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 3.2%. At the same time it's in pair with industry average of 3.2%.
- CAPEX is quite volatile: 1,161 in FY2015, 1,939 in FY2014, 1,111 in FY2013, 839 in FY2012, 533 in FY2011
- The company has highly profitable business model: ROIC is at 23.0%
- It operates with high leverage: Net Debt/EBITDA is -0.2x while industry average is -1.3x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Skyworth Digital Holdings Ltd ($751) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 24,339 | 28,137 | 37,824 | 39,480 | 40,135 | 1.7% |
| Gross Profit | 4,663 | 5,956 | 7,406 | 7,629 | 8,023 | 5.2% |
| SG&A | 3,425 | 4,492 | 5,599 | 5,989 | 5,957 | -0.5% |
| EBITDA | 1,706 | 1,702 | 2,293 | 2,236 | 4,538 | 103.0% |
| Net Income | 1,174 | 1,252 | 1,501 | 1,254 | 3,128 | 149.4% |
Balance Sheet
|
|---|
| Cash | 2,524 | 2,164 | 2,301 | 3,023 | 3,317 | 9.7% |
| Short Term Debt | 3,577 | 3,568 | 5,581 | 5,156 | 1,274 | -75.3% |
| Long Term Debt | 778 | 715 | 225 | 547 | 1,312 | 139.9% |
Cash flow
|
|---|
| Capex | 533 | 839 | 1,111 | 1,939 | 1,161 | -40.1% |
Ratios
|
|---|
| Revenue growth | 6.9% | 15.6% | 34.4% | 4.4% | 1.7% | |
| EBITDA growth | -3.7% | -0.2% | 34.7% | -2.5% | 103.0% | |
| Gross Margin | 19.2% | 21.2% | 19.6% | 19.3% | 20.0% | 0.7% |
| EBITDA Margin | 7.0% | 6.0% | 6.1% | 5.7% | 11.3% | 5.6% |
| Net Income Margin | 4.8% | 4.4% | 4.0% | 3.2% | 7.8% | 4.6% |
| SG&A, % of revenue | 14.1% | 16.0% | 14.8% | 15.2% | 14.8% | -0.3% |
| CAPEX, % of revenue | 2.2% | 3.0% | 2.9% | 4.9% | 2.9% | -2.0% |
| ROIC | 11.7% | 11.6% | 13.4% | 10.9% | 23.0% | 12.1% |
| ROE | 18.3% | 16.1% | 16.3% | 12.1% | 25.5% | 13.4% |
| Net Debt/EBITDA | 1.1x | 1.2x | 1.5x | 1.2x | -0.2x | -1.4x |
Revenue and profitability
The company's Revenue increased slightly on 1.7% in FY2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 4.0 pp from 34.9% to 30.9% in 2015.
Gross Margin increased slightly on 0.67 pp from 19.3% to 20.0% in FY2015. SG&A as a % of Revenue showed almost no change in FY2015.
Net Income marign increased on 4.6 pp from 3.2% to 7.8% in FY2015.
Capital expenditures (CAPEX) and working capital investments
In FY2015 the company had CAPEX/Revenue of 2.9%. Skyworth Digital Holdings Ltd showed almost no change in CAPEX/Revenue from FY2012 to FY2015. For the last three years the average CAPEX/Revenue was 3.6%.
Return on investment
The company operates at high and attractive ROIC (23.04%) and ROE (25.47%). ROIC jumped on 12.1 pp from 10.9% to 23.0% in FY2015. ROE surged on 13.4 pp from 12.1% to 25.5% in FY2015.
Leverage (Debt)
Debt level is -0.2x Net Debt / EBITDA and 0.6x Debt / EBITDA. Net Debt / EBITDA dropped on 1.4x from 1.2x to -0.2x in FY2015. Debt dropped on 54.7% in FY2015 while cash increased on 9.7% in FY2015.
Management team
The company's CEO is Yang Dongwen. Yang Dongwen has 6 years tenure at the company.
Appendix 1: Peers in Home Furnishings
Below we provide Skyworth Digital Holdings Ltd benchmarking against other companies in Home Furnishings 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 |
|---|
| Jiu Rong Holdings Ltd ($2358) | | | 136.9% | 438.7% | |
| See Corp Ltd ($491) | -58.7% | 13.7% | -31.9% | 134.1% | |
| BEP International Holdings Ltd ($2326) | 359.9% | 44.7% | -41.5% | 46.2% | |
| Aupu Group Holding Co Ltd ($477) | 2.6% | 5.7% | 9.0% | 26.4% | |
| Alco Holdings Ltd ($328) | -23.0% | -10.2% | -32.6% | 22.8% | |
| |
|---|
| Median (26 companies) | 21.6% | -0.2% | 5.4% | 1.1% | -22.1% |
|---|
| Skyworth Digital Holdings Ltd ($751) | | 15.6% | 34.4% | 4.4% | 1.7% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Aupu Group Holding Co Ltd ($477) | 47.1% | 48.6% | 45.0% | 47.8% | |
| South East Group Ltd ($726) | 36.2% | 25.5% | 51.6% | 38.8% | 82.4% |
| Grande Holdings Ltd/The ($186) | 19.9% | 23.7% | 25.4% | 29.0% | |
| Samson Holding Ltd ($531) | 24.9% | 25.6% | 25.4% | 27.3% | |
| Gold Peak Industries Holding Ltd ($40) | 26.8% | 25.8% | 23.6% | 24.9% | 25.6% |
| |
|---|
| Median (26 companies) | 16.4% | 17.3% | 16.8% | 15.9% | 54.0% |
|---|
| Skyworth Digital Holdings Ltd ($751) | 19.2% | 21.2% | 19.6% | 19.3% | 20.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| See Corp Ltd ($491) | -58.7% | -38.4% | -59.5% | 32.0% | |
| Aupu Group Holding Co Ltd ($477) | 18.1% | 15.3% | 17.6% | 30.1% | |
| Welling Holding Ltd ($382) | 8.6% | 11.9% | 12.8% | 10.8% | |
| Hing Lee HK Holdings Ltd ($396) | 9.3% | -3.0% | 4.3% | 9.4% | |
| Samson Holding Ltd ($531) | 6.2% | 7.5% | 6.6% | 9.4% | |
| |
|---|
| Median (26 companies) | 5.9% | 4.9% | 4.5% | 4.5% | -1,670.7% |
|---|
| Skyworth Digital Holdings Ltd ($751) | 7.0% | 6.0% | 6.1% | 5.7% | 11.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Royale Furniture Holdings Ltd ($1198) | 35.8% | | 14.1% | 16.5% | |
| Sunrise China Technology Group Ltd ($8226) | 7.9% | 126.4% | 69.3% | 7.4% | |
| Aupu Group Holding Co Ltd ($477) | 1.9% | 1.5% | 6.3% | 5.3% | |
| Alco Holdings Ltd ($328) | 5.1% | 0.8% | 1.4% | 5.2% | |
| Kasen International Holdings Ltd ($496) | 2.6% | 5.0% | 2.6% | 4.7% | |
| |
|---|
| Median (26 companies) | 1.8% | 1.5% | 1.9% | 2.7% | 5.5% |
|---|
| Skyworth Digital Holdings Ltd ($751) | 2.2% | 3.0% | 2.9% | 4.9% | 2.9% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Mastercraft International Holdings Ltd ($8146) | 76.2% | 54.4% | 38.6% | 36.4% | |
| Aupu Group Holding Co Ltd ($477) | 18.0% | 14.8% | 17.0% | 32.2% | |
| Haier Electronics Group Co Ltd ($1169) | 45.3% | 37.5% | 32.8% | 20.8% | |
| Welling Holding Ltd ($382) | 29.4% | 23.5% | 24.3% | 18.7% | |
| Tonly Electronics Holdings Ltd ($1249) | 7.0% | 4.2% | 7.1% | 15.9% | |
| |
|---|
| Median (26 companies) | 5.0% | 3.7% | 4.4% | 3.9% | -1.6% |
|---|
| Skyworth Digital Holdings Ltd ($751) | 11.7% | 11.6% | 13.4% | 10.9% | 23.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Kasen International Holdings Ltd ($496) | 9.6x | 2.2x | 3.7x | 44.9x | |
| Chigo Holding Ltd ($449) | 27.0x | 12.3x | 11.8x | 14.5x | |
| Gold Peak Industries Holding Ltd ($40) | 5.6x | 10.2x | 3.4x | 3.6x | 2.8x |
| Hisense Kelon Electrical Holdings Co Ltd ($921) | 3.3x | 1.2x | 0.9x | 1.0x | |
| TCL Multimedia Technology Holdings Ltd ($1070) | -0.0x | -0.3x | -2.3x | 0.7x | |
| |
|---|
| Median (19 companies) | 0.0x | -0.3x | -1.1x | -1.9x | 2.8x |
|---|
| Skyworth Digital Holdings Ltd ($751) | 1.1x | 1.2x | 1.5x | 1.2x | -0.2x |
