Far East Consortium International Ltd/HK CAPEX dropped on 57.9% in 2015 while Revenue jumped on 25.7%
24/06/2015 • About Far East Consortium International Ltd/HK (
$35) • By InTwits
Far East Consortium International Ltd/HK reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Far East Consortium International Ltd/HK has high CAPEX intensity: 5 year average CAPEX/Revenue was 26.1%. At the same time it's a lot of higher than industry average of 17.0%.
- CAPEX is quite volatile: 402 in FY2015, 955 in FY2014, 1,043 in FY2013, 824 in FY2012, 405 in FY2011
- The company has business model with low profitability: ROIC is at 7.7%
- It operates with high leverage: Net Debt/EBITDA is 4.0x while industry average is -29.6x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Far East Consortium International Ltd/HK ($35) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 1,654 | 1,761 | 3,732 | 4,066 | 5,110 | 25.7% |
| Gross Profit | 756 | 848 | 1,027 | 1,553 | 1,946 | 25.3% |
| SG&A | 404 | 467 | 553 | 592 | 719 | 21.5% |
| EBITDA | 829 | 1,006 | 1,288 | 1,750 | 1,861 | 6.3% |
| Net Income | 394 | 448 | 903 | 914 | 957 | 4.6% |
Balance Sheet
|
|---|
| Cash | 1,986 | 1,375 | 2,721 | 1,908 | 2,285 | 19.8% |
| Short Term Debt | 1,830 | 1,765 | 4,714 | 4,289 | 4,341 | 1.2% |
| Long Term Debt | 4,139 | 4,651 | 3,186 | 5,528 | 5,478 | -0.9% |
Cash flow
|
|---|
| Capex | 405 | 824 | 1,043 | 955 | 402 | -57.9% |
Ratios
|
|---|
| Revenue growth | -29.4% | 6.4% | 111.9% | 9.0% | 25.7% | |
| EBITDA growth | 27.6% | 21.5% | 28.0% | 35.9% | 6.3% | |
| Gross Margin | 45.7% | 48.1% | 27.5% | 38.2% | 38.1% | -0.1% |
| EBITDA Margin | 50.1% | 57.2% | 34.5% | 43.0% | 36.4% | -6.6% |
| Net Income Margin | 23.8% | 25.4% | 24.2% | 22.5% | 18.7% | -3.8% |
| SG&A, % of revenue | 24.4% | 26.5% | 14.8% | 14.6% | 14.1% | -0.5% |
| CAPEX, % of revenue | 24.5% | 46.8% | 27.9% | 23.5% | 7.9% | -15.6% |
| ROIC | 5.2% | 5.7% | 6.7% | 8.1% | 7.7% | -0.4% |
| ROE | 6.0% | 6.2% | 11.7% | 10.9% | 10.7% | -0.2% |
| Net Debt/EBITDA | 4.8x | 5.0x | 4.0x | 4.5x | 4.0x | -0.5x |
Revenue and profitability
Far East Consortium International Ltd/HK's Revenue jumped on 25.7% in FY2015. Revenue growth was financed by EBITDA margin decline. EBITDA Margin decreased on 6.6 pp from 43.0% to 36.4% in FY2015.
Gross Margin showed almost no change in FY2015. SG&A as a % of Revenue showed almost no change in FY2015.
Net Income marign decreased on 3.8 pp from 22.5% to 18.7% in FY2015.
Capital expenditures (CAPEX) and working capital investments
Far East Consortium International Ltd/HK's CAPEX/Revenue was 7.9% in FY2015. Far East Consortium International Ltd/HK's CAPEX/Revenue dropped on 38.9 pp from 46.8% in FY2012 to 7.9% in FY2015. It's average level of CAPEX/Revenue for the last three years was 19.8%.
Return on investment
The company operates at low ROIC (7.66%) and ROE (10.69%). ROIC showed almost no change in FY2015. ROE showed almost no change in FY2015.
Leverage (Debt)
Debt level is 4.0x Net Debt / EBITDA and 5.3x Debt / EBITDA. Net Debt / EBITDA dropped on 0.5x from 4.5x to 4.0x in FY2015. Debt showed almost no change in FY2015 while cash surged on 19.8% in FY2015.
Appendix 1: Peers in Lodging
Below you can find Far East Consortium International Ltd/HK benchmarking vs. other companies in Lodging 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 |
|---|
| Zhuhai Holdings Investment Group Ltd ($908) | 13.4% | 229.8% | 14.5% | 57.0% | |
| Carrianna Group Holdings Co Ltd ($126) | 13.0% | 69.3% | -36.2% | 35.4% | |
| NagaCorp Ltd ($3918) | 48.7% | 24.6% | 23.7% | 17.2% | |
| Emperor Entertainment Hotel Ltd ($296) | | 35.9% | 13.8% | 11.7% | -10.2% |
| Galaxy Entertainment Group Ltd ($27) | 113.8% | 37.8% | 16.4% | 8.7% | |
| |
|---|
| Median (21 companies) | 32.0% | 18.2% | 10.2% | 0.7% | -1.4% |
|---|
| Far East Consortium International Ltd/HK ($35) | | 6.4% | 111.9% | 9.0% | 25.7% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| SJM Holdings Ltd ($880) | 99.7% | 99.7% | 99.7% | 99.7% | |
| Wynn Macau Ltd ($1128) | 97.6% | 97.9% | 98.3% | 98.5% | |
| Emperor Entertainment Hotel Ltd ($296) | 70.9% | 77.1% | 75.6% | 76.8% | 70.9% |
| Asia Standard Hotel Group Ltd ($292) | 52.5% | 60.7% | 73.4% | 72.1% | 67.6% |
| Sino Hotels Holdings Ltd ($1221) | 69.7% | 71.3% | 70.4% | 68.9% | |
| |
|---|
| Median (15 companies) | 52.5% | 55.7% | 55.9% | 51.3% | 69.2% |
|---|
| Far East Consortium International Ltd/HK ($35) | 45.7% | 48.1% | 27.5% | 38.2% | 38.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Asia Standard Hotel Group Ltd ($292) | 69.1% | -23.9% | 65.2% | 49.9% | 40.4% |
| Emperor Entertainment Hotel Ltd ($296) | 38.7% | 44.9% | 46.4% | 46.9% | 43.1% |
| Sino Hotels Holdings Ltd ($1221) | 42.8% | 46.5% | 45.9% | 43.1% | |
| NagaCorp Ltd ($3918) | 49.2% | 49.8% | 50.1% | 42.8% | |
| Macau Legend Development Ltd ($1680) | 56.6% | 48.6% | 39.8% | 41.8% | |
| |
|---|
| Median (21 companies) | 23.7% | 25.0% | 24.5% | 25.8% | 41.8% |
|---|
| Far East Consortium International Ltd/HK ($35) | 50.1% | 57.2% | 34.5% | 43.0% | 36.4% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Macau Legend Development Ltd ($1680) | 1.3% | 5.0% | 24.2% | 73.0% | |
| Regal Hotels International Holdings Ltd ($78) | 4.9% | 7.4% | 7.2% | 60.4% | |
| Shangri-La Asia Ltd ($69) | 26.5% | 48.5% | 33.1% | 41.2% | |
| Wynn Macau Ltd ($1128) | 3.2% | 5.2% | 11.0% | 28.2% | |
| NagaCorp Ltd ($3918) | 20.3% | 25.9% | 17.2% | 24.0% | |
| |
|---|
| Median (21 companies) | 6.3% | 6.3% | 8.9% | 10.8% | 8.7% |
|---|
| Far East Consortium International Ltd/HK ($35) | 24.5% | 46.8% | 27.9% | 23.5% | 7.9% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| MGM China Holdings Ltd ($2282) | 47.3% | 46.2% | 53.8% | 54.5% | |
| Wynn Macau Ltd ($1128) | 66.1% | 53.9% | 42.3% | 29.9% | |
| Galaxy Entertainment Group Ltd ($27) | 14.7% | 25.2% | 30.0% | 27.5% | |
| Sands China Ltd ($1928) | 14.5% | 14.2% | 24.4% | 26.7% | |
| SJM Holdings Ltd ($880) | 26.2% | 29.7% | 31.0% | 24.8% | |
| |
|---|
| Median (21 companies) | 8.8% | 7.9% | 5.7% | 3.9% | 7.9% |
|---|
| Far East Consortium International Ltd/HK ($35) | 5.2% | 5.7% | 6.7% | 8.1% | 7.7% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Regal Hotels International Holdings Ltd ($78) | | 5.0x | 8.7x | 11.8x | |
| Century City International Holdings Ltd ($355) | -58.1x | 6.5x | 9.3x | 11.2x | |
| Shangri-La Asia Ltd ($69) | 4.0x | 6.0x | 6.8x | 6.9x | |
| Zhuhai Holdings Investment Group Ltd ($908) | -3.7x | -4.1x | 11.1x | 6.7x | |
| Asia Standard Hotel Group Ltd ($292) | 3.5x | | 3.7x | 5.2x | 5.5x |
| |
|---|
| Median (20 companies) | 0.1x | 0.2x | 0.4x | 0.4x | 2.7x |
|---|
| Far East Consortium International Ltd/HK ($35) | 4.8x | 5.0x | 4.0x | 4.5x | 4.0x |
