Veeko International Holdings Ltd reports 124% Net Income growth and 2.2 pp EBITDA Margin growth from 6.2% to 8.3%
24/06/2015 • About Veeko International Holdings Ltd (
$1173) • By InTwits
Veeko International Holdings Ltd reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Veeko International Holdings Ltd is a fast growth stock: FY2015 revenue growth was 23.3%, 5 year revenue CAGR was 17.6% at FY2015 ROIC 15.7%
- Veeko International Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.5%. At the same time it's a lot of higher than industry average of 5.8%.
- CAPEX is quite volatile: 129 in 2015, 239 in 2014, 236 in 2013, 120 in 2012, 88.1 in 2011
- The company has highly profitable business model: ROIC is at 15.7%
- It operates with high leverage: Net Debt/EBITDA is 0.1x while industry average is -0.7x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Veeko International Holdings Ltd ($1173) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 1,111 | 1,280 | 1,409 | 1,619 | 1,997 | 23.3% |
| Gross Profit | 606 | 658 | 675 | 751 | 884 | 17.7% |
| SG&A | 552 | 601 | 635 | 692 | 762 | 10.1% |
| EBITDA | 89 | 94 | 76 | 100 | 166 | 66.9% |
| Net Income | 67 | 61 | 54 | 46 | 102 | 123.9% |
Balance Sheet
|
|---|
| Cash | 118 | 106 | 83 | 91 | 77 | -15.8% |
| Short Term Debt | 10 | 58 | 75 | 87 | 82 | -4.7% |
| Long Term Debt | 8 | 4 | 1 | 15 | 5 | -66.3% |
Cash flow
|
|---|
| Capex | 23 | 46 | 38 | 36 | 40 | 10.8% |
Ratios
|
|---|
| Revenue growth | 25.4% | 15.1% | 10.1% | 15.0% | 23.3% | |
| EBITDA growth | 42.2% | 5.4% | -18.6% | 30.5% | 66.9% | |
| Gross Margin | 54.6% | 51.4% | 47.9% | 46.4% | 44.3% | -2.1% |
| EBITDA Margin | 8.0% | 7.3% | 5.4% | 6.2% | 8.3% | 2.2% |
| Net Income Margin | 6.0% | 4.8% | 3.9% | 2.8% | 5.1% | 2.3% |
| SG&A, % of revenue | 49.7% | 47.0% | 45.1% | 42.7% | 38.2% | -4.6% |
| CAPEX, % of revenue | 2.0% | 3.6% | 2.7% | 2.2% | 2.0% | -0.2% |
| ROIC | 10.9% | 9.7% | 6.2% | 8.4% | 15.7% | 7.3% |
| ROE | 13.7% | 10.5% | 8.9% | 7.2% | 14.6% | 7.5% |
| Net Debt/EBITDA | -1.1x | -0.5x | -0.1x | 0.1x | 0.1x | -0.0x |
Revenue and profitability
The company's Revenue surged on 23.3% in FY2015. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased slightly on 1.2 pp from 26.7% to 27.9% in 2015.
Gross Margin decreased on 2.1 pp from 46.4% to 44.3% in FY2015. SG&A as a % of Revenue decreased on 4.6 pp from 42.7% to 38.2% in FY2015.
Net Income marign increased on 2.3 pp from 2.8% to 5.1% in FY2015.
Capital expenditures (CAPEX) and working capital investments
In FY2015 Veeko International Holdings Ltd had CAPEX/Revenue of 2.0%. Veeko International Holdings Ltd's CAPEX/Revenue decreased slightly on 1.6 pp from 3.6% in FY2012 to 2.0% in FY2015. It's average CAPEX/Revenue for the last three years was 2.3%.
Return on investment
The company operates at good ROIC (15.70%) and ROE (14.63%). ROIC increased on 7.3 pp from 8.4% to 15.7% in FY2015. ROE increased on 7.5 pp from 7.2% to 14.6% in FY2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 0.1x and Debt / EBITDA is 0.5x. Net Debt / EBITDA decreased on 0.041x from 0.1x to 0.1x in FY2015. Debt dropped on 13.9% in FY2015 while cash dropped on 15.8% in FY2015.
Appendix 1: Peers in Retail
Below you can find Veeko International Holdings Ltd benchmarking vs. other companies in Retail 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 Household Holdings Ltd ($692) | -87.0% | -32.8% | 5,357.9% | 76.2% | |
| Ming Fung Jewellery Group Ltd ($860) | 21.9% | 3.3% | -14.9% | 54.3% | |
| Merry Garden Holdings Ltd ($1237) | 53.9% | 37.1% | 12.8% | 47.6% | |
| Luk Fook Holdings International Ltd ($590) | 50.2% | 47.2% | 12.6% | 43.3% | |
| NewOcean Energy Holdings Ltd ($342) | 19.3% | 23.1% | 15.9% | 36.0% | |
| |
|---|
| Median (108 companies) | 21.5% | 9.9% | 5.7% | 2.7% | -0.7% |
|---|
| Veeko International Holdings Ltd ($1173) | | 15.1% | 10.1% | 15.0% | 23.3% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Culture Landmark Investment Ltd ($674) | 77.5% | 91.1% | 99.4% | 99.5% | |
| Modern Beauty Salon Holdings Ltd ($919) | 97.3% | 97.4% | 95.9% | 96.8% | |
| Vongroup Ltd ($318) | | | | 95.1% | |
| Nanjing Sinolife United Co Ltd ($3332) | 80.6% | 86.5% | 89.3% | 90.9% | |
| Embry Holdings Ltd ($1388) | 82.3% | 81.2% | 80.4% | 82.3% | |
| |
|---|
| Median (97 companies) | 40.0% | 37.7% | 38.0% | 35.6% | 46.5% |
|---|
| Veeko International Holdings Ltd ($1173) | 54.6% | 51.4% | 47.9% | 46.4% | 44.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Maoye International Holdings Ltd ($848) | 45.5% | 47.4% | 46.3% | 73.2% | |
| China Dongxiang Group Co Ltd ($3818) | 5.6% | 6.0% | 5.6% | 58.3% | |
| Nanjing Sinolife United Co Ltd ($3332) | 47.8% | 51.6% | 56.9% | 54.4% | |
| Lifestyle International Holdings Ltd ($1212) | 49.6% | 47.5% | 47.0% | 44.7% | |
| Golden Eagle Retail Group Ltd ($3308) | 52.1% | 48.5% | 47.3% | 42.8% | |
| |
|---|
| Median (108 companies) | 13.4% | 10.3% | 7.3% | 8.8% | 5.9% |
|---|
| Veeko International Holdings Ltd ($1173) | 8.0% | 7.3% | 5.4% | 6.2% | 8.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Intime Retail Group Co Ltd ($1833) | 58.4% | 28.3% | 55.4% | 37.0% | |
| Future Bright Holdings Ltd ($703) | 6.2% | 2.6% | 3.7% | 36.8% | |
| Sage International Group Ltd ($8082) | 20.4% | 236.6% | 28.2% | 35.4% | |
| Maoye International Holdings Ltd ($848) | 30.9% | 32.8% | 24.1% | 31.5% | |
| Tsui Wah Holdings Ltd ($1314) | 5.2% | 8.3% | 9.3% | 30.5% | |
| |
|---|
| Median (108 companies) | 3.9% | 4.1% | 3.6% | 3.5% | 2.7% |
|---|
| Veeko International Holdings Ltd ($1173) | 2.0% | 3.6% | 2.7% | 2.2% | 2.0% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Modern Beauty Salon Holdings Ltd ($919) | 48.1% | 50.7% | -4.6% | 81.3% | |
| Starbucks Corp ($4337) | 36.4% | 36.4% | -6.0% | 52.8% | |
| Sa Sa International Holdings Ltd ($178) | 45.7% | 53.5% | 52.7% | 49.0% | |
| Coach Inc ($6388) | 82.0% | 82.3% | 68.7% | 45.0% | |
| Nanjing Sinolife United Co Ltd ($3332) | 57.4% | 67.3% | 68.1% | 32.2% | |
| |
|---|
| Median (108 companies) | 17.2% | 11.9% | 8.2% | 8.2% | 6.2% |
|---|
| Veeko International Holdings Ltd ($1173) | 10.9% | 9.7% | 6.2% | 8.4% | 15.7% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Sparkle Roll Group Ltd ($970) | -0.8x | 0.6x | 4.0x | 9.3x | |
| China Yongda Automobiles Services Holdings Ltd ($3669) | 3.3x | 3.4x | 4.7x | 5.5x | |
| Zhongsheng Group Holdings Ltd ($881) | 2.2x | 4.6x | 4.5x | 5.3x | |
| NewOcean Energy Holdings Ltd ($342) | 35.2x | 6.2x | 6.1x | 5.3x | |
| Century Ginwa Retail Holdings Ltd ($162) | 6.5x | 2.0x | 2.5x | 4.8x | |
| |
|---|
| Median (84 companies) | -0.8x | -0.6x | -0.9x | -0.3x | -1.1x |
|---|
| Veeko International Holdings Ltd ($1173) | -1.1x | -0.5x | -0.1x | 0.1x | 0.1x |
