China Gas Holdings Ltd reports 30.9% Net Income growth and 21.8% Revenue growth
24/06/2015 • About China Gas Holdings Ltd (
$384) • By InTwits
China Gas Holdings Ltd reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- China Gas Holdings Ltd is a growth stock: FY2015 revenue growth was 21.8%, 5 year revenue CAGR was 25.4% at FY2015 ROIC 10.6%
- China Gas Holdings Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 12.0%. At the same time it's in pair with industry average of 12.3%.
- CAPEX is quite volatile: 3,788 in 2015, 5,909 in 2014, 2,640 in 2013, 2,115 in 2012, 5,386 in 2011
- The company has business model with average profitability: ROIC is at 10.6%
- It operates with high leverage: Net Debt/EBITDA is 2.9x while industry average is 2.4x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
China Gas Holdings Ltd ($384) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 15,862 | 18,934 | 17,956 | 26,008 | 31,666 | 21.8% |
| Gross Profit | 2,910 | 3,606 | 3,776 | 5,286 | 6,456 | 22.1% |
| SG&A | 1,516 | 1,672 | 1,788 | 2,071 | 2,586 | 24.8% |
| EBITDA | 2,249 | 2,874 | 2,971 | 4,319 | 5,326 | 23.3% |
| Net Income | 626 | 954 | 1,764 | 2,576 | 3,371 | 30.9% |
Balance Sheet
|
|---|
| Cash | 5,082 | 4,818 | 3,959 | 6,454 | 5,228 | -19.0% |
| Short Term Debt | 7,331 | 8,971 | 8,454 | 5,763 | 3,920 | -32.0% |
| Long Term Debt | 7,720 | 6,407 | 6,356 | 14,192 | 16,817 | 18.5% |
Cash flow
|
|---|
| Capex | 1,938 | 1,783 | 2,457 | 3,208 | 3,887 | 21.2% |
Ratios
|
|---|
| Revenue growth | 55.3% | 19.4% | -5.2% | 44.8% | 21.8% | |
| EBITDA growth | 28.4% | 27.8% | 3.4% | 45.4% | 23.3% | |
| Gross Margin | 18.3% | 19.0% | 21.0% | 20.3% | 20.4% | 0.1% |
| EBITDA Margin | 14.2% | 15.2% | 16.5% | 16.6% | 16.8% | 0.2% |
| Net Income Margin | 3.9% | 5.0% | 9.8% | 9.9% | 10.6% | 0.7% |
| SG&A, % of revenue | 9.6% | 8.8% | 10.0% | 8.0% | 8.2% | 0.2% |
| CAPEX, % of revenue | 12.2% | 9.4% | 13.7% | 12.3% | 12.3% | -0.1% |
| ROIC | 6.8% | 8.4% | 8.6% | 10.6% | 10.6% | 0.0% |
| ROE | 9.7% | 10.3% | 16.6% | 18.9% | 19.7% | 0.8% |
| Net Debt/EBITDA | 4.4x | 3.7x | 3.7x | 3.1x | 2.9x | -0.2x |
Revenue and profitability
China Gas Holdings Ltd's Revenue jumped on 21.8% in FY2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 11.9 pp from 9.4% to -2.4% in 2015.
Gross Margin showed almost no change in FY2015. SG&A as a % of Revenue showed almost no change in FY2015.
Net Income marign increased slightly on 0.74 pp from 9.9% to 10.6% in FY2015.
Capital expenditures (CAPEX) and working capital investments
In FY2015 China Gas Holdings Ltd had CAPEX/Revenue of 12.3%. The company's CAPEX/Revenue increased on 2.9 pp from 9.4% in FY2012 to 12.3% in FY2015. It's average CAPEX/Revenue for the last three years was 12.8%.To deliver this fast growth the company invested a large share of EBITDA (73.0%) to CAPEX.
Return on investment
The company operates at good ROE (19.73%) while ROIC is low (10.62%). ROIC showed almost no change in FY2015. ROE increased slightly on 0.84 pp from 18.9% to 19.7% in FY2015.
Leverage (Debt)
Debt level is 2.9x Net Debt / EBITDA and 3.9x Debt / EBITDA. Net Debt / EBITDA dropped on 0.2x from 3.1x to 2.9x in FY2015. Debt increased on 3.9% in FY2015 while cash dropped on 19.0% in FY2015.
Appendix 1: Peers in Gas
Below you can find China Gas Holdings Ltd benchmarking vs. other companies in Gas 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 |
|---|
| China Resources Gas Group Ltd ($1193) | 52.3% | -4.1% | 63.6% | 28.8% | |
| ENN Energy Holdings Ltd ($2688) | 34.4% | 19.6% | 27.4% | 26.7% | |
| China Oil & Gas Group Ltd ($603) | 67.2% | 11.4% | 31.7% | 19.5% | |
| Towngas China Co Ltd ($1083) | 44.9% | 20.0% | 29.6% | 17.4% | |
| Binhai Investment Co Ltd ($2886) | 54.8% | 35.0% | 34.2% | 14.1% | |
| |
|---|
| Median (8 companies) | 44.9% | 11.4% | 29.6% | 15.7% | -37.9% |
|---|
| China Gas Holdings Ltd ($384) | | 19.4% | -5.2% | 44.8% | 21.8% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Resources Gas Group Ltd ($1193) | 29.3% | 31.2% | 34.2% | 30.3% | |
| ENN Energy Holdings Ltd ($2688) | 25.9% | 26.9% | 23.8% | 20.9% | |
| Binhai Investment Co Ltd ($2886) | 13.6% | 20.1% | 20.6% | 18.3% | |
| Beijing Enterprises Holdings Ltd ($392) | 22.1% | 20.7% | 19.7% | 17.9% | |
| China Oil Gangran Energy Group Holdings Ltd ($8132) | 21.2% | 9.4% | 17.2% | 16.4% | 20.3% |
| |
|---|
| Median (6 companies) | 21.6% | 21.6% | 21.6% | 18.1% | 20.3% |
|---|
| China Gas Holdings Ltd ($384) | 18.3% | 19.0% | 21.0% | 20.3% | 20.4% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Hong Kong & China Gas Co Ltd ($3) | 31.1% | 30.0% | 29.6% | 29.2% | |
| Towngas China Co Ltd ($1083) | 19.3% | 19.9% | 18.9% | 18.8% | |
| ENN Energy Holdings Ltd ($2688) | 18.4% | 20.4% | 15.1% | 18.2% | |
| China Resources Gas Group Ltd ($1193) | 18.2% | 16.2% | 17.4% | 17.7% | |
| China Oil & Gas Group Ltd ($603) | 17.6% | 21.5% | 21.2% | 16.0% | |
| |
|---|
| Median (8 companies) | 18.2% | 19.9% | 17.4% | 16.8% | -135.7% |
|---|
| China Gas Holdings Ltd ($384) | 14.2% | 15.2% | 16.5% | 16.6% | 16.8% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Towngas China Co Ltd ($1083) | 21.1% | 31.3% | 25.7% | 26.2% | |
| Hong Kong & China Gas Co Ltd ($3) | 20.7% | 23.7% | 18.7% | 20.1% | |
| Binhai Investment Co Ltd ($2886) | 23.6% | 26.9% | 18.0% | 15.5% | |
| China Oil & Gas Group Ltd ($603) | 17.1% | 15.0% | 18.3% | 15.4% | |
| China Resources Gas Group Ltd ($1193) | 14.3% | 20.6% | 18.5% | 12.4% | |
| |
|---|
| Median (8 companies) | 17.1% | 20.6% | 18.0% | 13.9% | 2.9% |
|---|
| China Gas Holdings Ltd ($384) | 12.2% | 9.4% | 13.7% | 12.3% | 12.3% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| ENN Energy Holdings Ltd ($2688) | 13.1% | 14.3% | 11.7% | 16.4% | |
| China Resources Gas Group Ltd ($1193) | 11.9% | 6.9% | 10.4% | 11.4% | |
| Binhai Investment Co Ltd ($2886) | 7.6% | 12.2% | 12.2% | 10.9% | |
| China Oil & Gas Group Ltd ($603) | 14.0% | 13.7% | 13.2% | 7.6% | |
| Hong Kong & China Gas Co Ltd ($3) | 8.0% | 7.3% | 7.4% | 7.5% | |
| |
|---|
| Median (9 companies) | 8.0% | 7.3% | 10.4% | 7.5% | -28.9% |
|---|
| China Gas Holdings Ltd ($384) | 6.8% | 8.4% | 8.6% | 10.6% | 10.6% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Beijing Enterprises Holdings Ltd ($392) | 1.6x | 3.1x | 2.6x | 4.7x | |
| Towngas China Co Ltd ($1083) | 3.6x | 3.5x | 3.7x | 4.1x | |
| Binhai Investment Co Ltd ($2886) | -0.4x | 3.4x | 2.8x | 3.5x | |
| China Oil & Gas Group Ltd ($603) | -0.8x | -0.0x | 1.0x | 2.8x | |
| Hong Kong & China Gas Co Ltd ($3) | 2.2x | 2.6x | 2.8x | 2.1x | |
| |
|---|
| Median (7 companies) | 1.3x | 2.6x | 1.6x | 2.8x | -0.6x |
|---|
| China Gas Holdings Ltd ($384) | 4.4x | 3.7x | 3.7x | 3.1x | 2.9x |
