Epicurean and Co Ltd reports 94.5% EBITDA growth and 22.0% Revenue growth
22/06/2015 • About Epicurean and Co Ltd (
$8213) • By InTwits
Epicurean and Co Ltd reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Epicurean and Co Ltd doesn't have a profitable business model yet: FY2015 ROIC is -16.4%
- EBITDA Margin is quite volatile: 2.3% in FY2015, 1.4% in FY2014, 5.4% in FY2013, 4.0% in FY2012, 12.0% in FY2011
- Epicurean and Co Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 14.0%. At the same time it's a lot of higher than industry average of 6.1%.
- CAPEX is quite volatile: 27.7 in FY2015, 42.7 in FY2014, 26.6 in FY2013, 22.6 in FY2012, 6.0 in FY2011
- The company has unprofitable business model: ROIC is at -16.4%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Epicurean and Co Ltd ($8213) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 32.2 | 89.3 | 255.1 | 414.6 | 506.0 | 22.0% |
| Gross Profit | 23.8 | 60.5 | 171.6 | 279.2 | 346.0 | 23.9% |
| EBITDA | 3.9 | 3.6 | 13.8 | 5.9 | 11.5 | 94.5% |
| Net Income | -27.6 | -16.0 | -17.9 | -27.7 | -36.6 | 32.2% |
Balance Sheet
|
|---|
| Cash | 25.5 | 30.2 | 34.0 | 27.2 | 49.6 | 82.2% |
| Short Term Debt | 0.0 | 38.3 | 19.1 | 20.5 | 188.3 | 817.3% |
| Long Term Debt | 36.7 | 0.0 | 80.2 | 79.4 | 0.0 | -100.0% |
Cash flow
|
|---|
| Capex | 6.0 | 22.6 | 26.6 | 42.7 | 27.7 | -35.2% |
Ratios
|
|---|
| Revenue growth | -38.5% | 177.0% | 185.7% | 62.6% | 22.0% | |
| EBITDA growth | -162.7% | -7.6% | 283.8% | -56.9% | 94.5% | |
| Gross Margin | 73.9% | 67.8% | 67.3% | 67.3% | 68.4% | 1.0% |
| EBITDA Margin | 12.0% | 4.0% | 5.4% | 1.4% | 2.3% | 0.8% |
| Net Income Margin | -85.8% | -17.9% | -7.0% | -6.7% | -7.2% | -0.6% |
| CAPEX, % of revenue | 18.7% | 25.3% | 10.4% | 10.3% | 5.5% | -4.8% |
| ROIC | -5.1% | -7.2% | -2.4% | -13.9% | -16.4% | -2.5% |
| ROE | -141.9% | -51.2% | -36.7% | -61.7% | | 61.7% |
| Net Debt/EBITDA | 2.9x | 2.3x | 4.7x | 12.3x | 12.0x | -0.2x |
Revenue and profitability
Epicurean and Co Ltd's Revenue surged on 22.0% in FY2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 4.0 pp from -13.3% to -9.3% in 2015.
Gross Margin increased slightly on 1.0 pp from 67.3% to 68.4% in FY2015.
Net Income marign decreased slightly on 0.56 pp from -6.7% to -7.2% in FY2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 5.5% in FY2015. CAPEX/Revenue dropped on 19.9 pp from 25.3% in FY2012 to 5.5% in FY2015. It's average CAPEX/Revenue for the last three years was 8.7%.To fuel this fast growth the company made large investments to CAPEX (240% of EBITDA).
Leverage (Debt)
Debt level is 12.0x Net Debt / EBITDA and 16.3x Debt / EBITDA. Net Debt / EBITDA dropped on 0.2x from 12.3x to 12.0x in FY2015. Debt jumped on 88.5% in FY2015 while cash jumped on 82.2% in FY2015.
Appendix 1: Peers in Software
Below you can find Epicurean and Co Ltd benchmarking vs. other companies in Software 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, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Pizu Group Holdings Ltd ($8053) | -55.1% | 40.3% | -42.9% | 1,742.9% | |
| China City Railway Transportation Technology Holdings Co Ltd ($1522) | 194.6% | 164.0% | 33.6% | 100.5% | |
| China Mobile Games and Cultural Investment Ltd ($8081) | -16.7% | 393.7% | -6.6% | 92.2% | |
| China Bio Cassava Holdings Ltd ($8129) | -15.0% | -14.2% | 38.8% | 55.1% | |
| Kingsoft Corp Ltd ($3888) | 5.1% | 38.3% | 54.0% | 54.2% | |
| |
|---|
| Median (30 companies) | 17.0% | 10.6% | 11.1% | 20.9% | 28.4% |
|---|
| Epicurean and Co Ltd ($8213) | | 177.0% | 185.7% | 62.6% | 22.0% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Bio Cassava Holdings Ltd ($8129) | 90.2% | 90.4% | 97.4% | 98.4% | |
| NetDragon Websoft Inc ($777) | 90.1% | 93.4% | 90.8% | 89.3% | |
| China Mobile Games and Cultural Investment Ltd ($8081) | 19.4% | 6.5% | 45.3% | 84.8% | |
| Kingdee International Software Group Co Ltd ($268) | 70.1% | 65.0% | 75.3% | 82.5% | |
| Kingsoft Corp Ltd ($3888) | 85.5% | 86.8% | 86.3% | 82.4% | |
| |
|---|
| Median (29 companies) | 41.6% | 34.3% | 36.0% | 33.0% | 39.4% |
|---|
| Epicurean and Co Ltd ($8213) | 73.9% | 67.8% | 67.3% | 67.3% | 68.4% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Sinosoft Technology Group Ltd ($1297) | 55.5% | 62.6% | 54.9% | 57.2% | |
| International Entertainment Corp ($1009) | 235.1% | 50.8% | 64.0% | 54.9% | 62.0% |
| Microsoft Corp ($4338) | 42.8% | 33.5% | 39.2% | 38.0% | |
| Kingdee International Software Group Co Ltd ($268) | 19.5% | 7.8% | 33.2% | 37.2% | |
| TravelSky Technology Ltd ($696) | 43.3% | 38.1% | 35.8% | 31.9% | |
| |
|---|
| Median (30 companies) | 8.4% | 7.8% | 10.9% | 7.4% | 9.1% |
|---|
| Epicurean and Co Ltd ($8213) | 12.0% | 4.0% | 5.4% | 1.4% | 2.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| NetDragon Websoft Inc ($777) | 13.3% | 21.1% | 34.6% | 54.6% | |
| China Eco-Farming Ltd ($8166) | 0.3% | 0.6% | 0.7% | 18.1% | |
| TravelSky Technology Ltd ($696) | 5.8% | 8.9% | 21.7% | 18.1% | |
| Kingsoft Corp Ltd ($3888) | 6.8% | 4.3% | 3.8% | 14.3% | |
| Sing Lee Software Group Ltd ($8076) | 19.4% | 3.3% | 0.2% | 14.0% | |
| |
|---|
| Median (29 companies) | 2.4% | 1.4% | 2.6% | 3.5% | 0.2% |
|---|
| Epicurean and Co Ltd ($8213) | 18.7% | 25.3% | 10.4% | 10.3% | 5.5% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Microsoft Corp ($4338) | 43.4% | 28.6% | 30.3% | 26.2% | |
| Sinosoft Technology Group Ltd ($1297) | 31.6% | 34.0% | 21.9% | 20.2% | |
| Boyaa Interactive International Ltd ($434) | 100.4% | 75.3% | 21.3% | 20.0% | |
| ITE Holdings Ltd ($8092) | -19.6% | -15.0% | 10.6% | 16.8% | 19.8% |
| TravelSky Technology Ltd ($696) | 16.2% | 15.0% | 13.8% | 12.5% | |
| |
|---|
| Median (30 companies) | 4.9% | 1.4% | 4.7% | -0.4% | 2.2% |
|---|
| Epicurean and Co Ltd ($8213) | -5.1% | -7.2% | -2.4% | -13.9% | -16.4% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Pizu Group Holdings Ltd ($8053) | | | | 346.1x | |
| Sing Lee Software Group Ltd ($8076) | | | | 6.2x | |
| China Technology Solar Power Holdings Ltd ($8111) | | | 7.4x | 3.3x | |
| Chinasoft International Ltd ($354) | -1.3x | -0.7x | 0.7x | 1.5x | |
| Kingdee International Software Group Co Ltd ($268) | -0.1x | 5.0x | 1.1x | 0.5x | |
| |
|---|
| Median (18 companies) | -1.0x | -0.9x | -1.4x | -1.0x | -4.9x |
|---|
| Epicurean and Co Ltd ($8213) | 2.9x | 2.3x | 4.7x | 12.3x | 12.0x |
