Asia Orient Holdings Ltd reports 776% CAPEX growth and 3.9% Revenue growth
24/06/2015 • About Asia Orient Holdings Ltd (
$214) • By InTwits
Asia Orient Holdings Ltd reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is quite volatile: 64.5% in FY2015, 112.0% in FY2014, 141.6% in FY2013, -82.0% in FY2012, 229.8% in FY2011
- Asia Orient Holdings Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 26.2%. At the same time it's in pair with industry average of 6.2%.
- CAPEX is quite volatile: 1,304 in FY2015, 149 in FY2014, 223 in FY2013, 19.8 in FY2012, 0.47 in FY2011
- The company has potentially unprofitable business model: ROIC is at 2.7%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Asia Orient Holdings Ltd ($214) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 194 | 1,253 | 1,027 | 1,308 | 1,359 | 3.9% |
| Gross Profit | 156 | 877 | 836 | 978 | 1,116 | 14.0% |
| SG&A | | | 209 | 196 | 214 | 9.1% |
| EBITDA | 446 | -1,027 | 1,455 | 1,465 | 876 | -40.2% |
| Net Income | 2,791 | -89 | 1,364 | 774 | 513 | -33.7% |
Balance Sheet
|
|---|
| Cash | 319 | 408 | 414 | 1,462 | 1,244 | -14.9% |
| Short Term Debt | 1,792 | 1,527 | 479 | 978 | 1,099 | 12.5% |
| Long Term Debt | 2,270 | 2,426 | 2,967 | 4,460 | 5,499 | 23.3% |
Cash flow
|
|---|
| Capex | 0 | 20 | 223 | 149 | 1,304 | 775.7% |
Ratios
|
|---|
| Revenue growth | 288.8% | 545.5% | -18.0% | 27.3% | 3.9% | |
| EBITDA growth | 35.6% | -330.4% | -241.6% | 0.7% | -40.2% | |
| Gross Margin | 80.3% | 70.0% | 81.4% | 74.8% | 82.1% | 7.3% |
| EBITDA Margin | 229.8% | -82.0% | 141.6% | 112.0% | 64.5% | -47.5% |
| Net Income Margin | 1,438.2% | -7.1% | 132.8% | 59.2% | 37.8% | -21.4% |
| SG&A, % of revenue | | | 20.3% | 15.0% | 15.7% | 0.8% |
| CAPEX, % of revenue | 0.2% | 1.6% | 21.7% | 11.4% | 96.0% | 84.6% |
| ROIC | 3.5% | -6.1% | 6.2% | 5.5% | 2.7% | -2.8% |
| ROE | 49.9% | -1.3% | 17.8% | 8.8% | 5.4% | -3.4% |
| Net Debt/EBITDA | 8.4x | | 2.1x | 2.7x | 6.1x | 3.4x |
Revenue and profitability
Asia Orient Holdings Ltd's Revenue increased on 3.9% 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.
Gross Margin increased on 7.3 pp from 74.8% to 82.1% in FY2015. SG&A as a % of Revenue increased slightly on 0.75 pp from 15.0% to 15.7% in FY2015.
Net Income marign dropped on 21.4 pp from 59.2% to 37.8% in FY2015.
Capital expenditures (CAPEX) and working capital investments
In FY2015 Asia Orient Holdings Ltd had CAPEX/Revenue of 96.0%. Asia Orient Holdings Ltd showed fast CAPEX/Revenue growth of 94.4 pp from 1.6% in FY2012 to 96.0% in FY2015. Average CAPEX/Revenue for the last three years was 43.0%.The company maintained rich investment policy and has spent a lot to CAPEX (149% of EBITDA).
Return on investment
The company operates at low ROIC (2.70%) and ROE (5.38%). ROIC decreased on 2.8 pp from 5.5% to 2.7% in FY2015. ROE decreased on 3.4 pp from 8.8% to 5.4% in FY2015.
Leverage (Debt)
Debt level is 6.1x Net Debt / EBITDA and 7.5x Debt / EBITDA. Net Debt / EBITDA surged on 3.4x from 2.7x to 6.1x in FY2015. Debt surged on 21.4% in FY2015 while cash dropped on 14.9% in FY2015.
Appendix 1: Peers in Real Estate
Below you can find Asia Orient Holdings Ltd benchmarking vs. other companies in Real Estate 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 |
|---|
| Common Splendor International Health Industry Group Ltd ($286) | -0.9% | -0.5% | 1.9% | 4,120.2% | |
| Landsea Green Properties Co Ltd ($106) | -91.1% | -35.1% | -51.2% | 3,097.3% | |
| LVGEM China Real Estate Invest ($95) | -0.1% | -27.5% | -21.9% | 3,008.3% | |
| Rivera Holdings Ltd ($281) | 222.2% | 197.1% | -89.9% | 2,067.2% | |
| Ceneric Holdings Ltd ($542) | -94.0% | -73.9% | -49.8% | 1,922.5% | |
| |
|---|
| Median (172 companies) | 15.0% | 15.2% | 13.1% | 5.0% | 2.9% |
|---|
| Asia Orient Holdings Ltd ($214) | | 545.5% | -18.0% | 27.3% | 3.9% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Tern Properties Co Ltd ($277) | 96.9% | 96.7% | 98.4% | 98.4% | 98.7% |
| GR Properties Ltd ($108) | 37.4% | 39.3% | | 98.2% | |
| Renhe Commercial Holdings Co Ltd ($1387) | 71.1% | 79.0% | 95.2% | 97.9% | |
| YT Realty Group Ltd ($75) | 91.5% | 94.4% | 96.6% | 96.7% | |
| ITC Properties Group Ltd ($199) | 29.8% | 22.8% | 92.9% | 95.2% | |
| |
|---|
| Median (154 companies) | 43.4% | 41.9% | 40.0% | 38.9% | 36.9% |
|---|
| Asia Orient Holdings Ltd ($214) | 80.3% | 70.0% | 81.4% | 74.8% | 82.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| ITC Properties Group Ltd ($199) | 24.0% | -125.5% | -2,995.7% | 1,685.3% | |
| Beijing Properties Holdings Ltd ($925) | 33.2% | -606.3% | 2,162.6% | 224.3% | |
| Chinese Estates Holdings Ltd ($127) | 340.9% | 356.2% | 91.6% | 195.5% | |
| Zall Development Group Ltd ($2098) | 73.6% | 105.3% | 133.1% | 143.2% | |
| Ceneric Holdings Ltd ($542) | -5.9% | -382.7% | -1,024.0% | 126.8% | |
| |
|---|
| Median (172 companies) | 35.2% | 28.9% | 27.9% | 26.4% | 20.4% |
|---|
| Asia Orient Holdings Ltd ($214) | 229.8% | -82.0% | 141.6% | 112.0% | 64.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| LT Commercial Real Estate Ltd ($112) | 0.0% | 0.0% | 18.0% | 27,965.5% | |
| ITC Properties Group Ltd ($199) | 25.6% | 56.2% | 4,202.4% | 1,304.7% | |
| Wanda Hotel Development Co Ltd ($169) | | 5.9% | 24.1% | 1,091.1% | |
| Pacific Century Premium Developments Ltd ($432) | 6.5% | 2.9% | 323.1% | 351.2% | |
| Liu Chong Hing Investment Ltd ($194) | 9.4% | 18.5% | 6.1% | 269.7% | |
| |
|---|
| Median (173 companies) | 6.0% | 5.6% | 6.1% | 4.5% | 1.2% |
|---|
| Asia Orient Holdings Ltd ($214) | 0.2% | 1.6% | 21.7% | 11.4% | 96.0% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Rykadan Capital Ltd ($2288) | 17.2% | -1.8% | -2.6% | 48.4% | -3.7% |
| LVGEM China Real Estate Invest ($95) | 0.2% | -0.2% | -1.1% | 22.1% | |
| Zall Development Group Ltd ($2098) | 39.0% | 19.2% | 17.6% | 18.7% | |
| China Overseas Land & Investment Ltd ($688) | 18.0% | 18.4% | 15.1% | 18.5% | |
| Hong Kong Ferry Holdings Co Ltd ($50) | 4.7% | 3.8% | 0.6% | 18.0% | |
| |
|---|
| Median (176 companies) | 4.6% | 4.0% | 3.8% | 3.8% | 1.7% |
|---|
| Asia Orient Holdings Ltd ($214) | 3.5% | -6.1% | 6.2% | 5.5% | 2.7% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Properties Group Ltd ($1838) | 16.9x | 43.0x | 21.4x | 1,523.0x | |
| SRE Group Ltd ($1207) | 10.6x | 14.1x | 24.7x | 1,184.6x | |
| Cheuk Nang Holdings Ltd ($131) | 53.2x | | 177.3x | 901.7x | |
| Tian An China Investment Co Ltd ($28) | 2.4x | 13.2x | 15.1x | 486.6x | |
| Greenland Hong Kong Holdings Ltd ($337) | 3.7x | | 6.2x | 49.3x | |
| |
|---|
| Median (139 companies) | 2.1x | 2.4x | 2.8x | 3.0x | 0.5x |
|---|
| Asia Orient Holdings Ltd ($214) | 8.4x | | 2.1x | 2.7x | 6.1x |
