Tianda Pharmaceuticals Ltd reports 181% Net Income decline and 40.5 pp EBITDA Margin decline from 33.2% to -7.3%
25/06/2015 • About Tianda Pharmaceuticals Ltd (
$455) • By InTwits
Tianda Pharmaceuticals Ltd reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Tianda Pharmaceuticals Ltd doesn't have a profitable business model yet: FY2015 ROIC is -3.8%
- EBITDA Margin is declining: -7.3% in FY2015 vs. 33.2% in FY2014 vs. 66.9% in FY2011
- EBITDA Margin is quite volatile: -7.3% in FY2015, 33.2% in FY2014, 42.0% in FY2013, 77.7% in FY2012, 66.9% in FY2011
- Tianda Pharmaceuticals Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 9.9%. At the same time it's a lot of higher than industry average of 6.6%.
- CAPEX is quite volatile: 34.0 in FY2015, 26.0 in FY2014, 7.0 in FY2013, 5.8 in FY2012, 5.0 in FY2011
- The company has unprofitable business model: ROIC is at -3.8%
- It operates with high leverage: Net Debt/EBITDA is -0.0x 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.
Tianda Pharmaceuticals Ltd ($455) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 103.7 | 97.3 | 180.2 | 247.2 | 139.4 | -43.6% |
| Gross Profit | 82.5 | 72.5 | 124.0 | 158.5 | 69.8 | -56.0% |
| SG&A | | | 68.2 | 99.1 | 103.1 | 4.0% |
| EBITDA | 69.3 | 75.6 | 75.7 | 82.1 | -10.2 | -112.4% |
| Net Income | 67.4 | 43.1 | 37.7 | 22.0 | -17.9 | -181.4% |
Balance Sheet
|
|---|
| Cash | 557.0 | 412.1 | 426.1 | 427.3 | 384.2 | -10.1% |
| Short Term Debt | 24.3 | 0.0 | 0.0 | 0.0 | 0.0 | |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 5.0 | 5.8 | 7.0 | 26.0 | 34.0 | 30.9% |
Ratios
|
|---|
| Revenue growth | 25.0% | -6.2% | 85.3% | 37.2% | -43.6% | |
| EBITDA growth | 44.9% | 9.0% | 0.1% | 8.5% | -112.4% | |
| Gross Margin | 79.6% | 74.5% | 68.8% | 64.1% | 50.1% | -14.1% |
| EBITDA Margin | 66.9% | 77.7% | 42.0% | 33.2% | -7.3% | -40.5% |
| Net Income Margin | 65.0% | 44.3% | 20.9% | 8.9% | -12.9% | -21.8% |
| SG&A, % of revenue | | | 37.9% | 40.1% | 73.9% | 33.8% |
| CAPEX, % of revenue | 4.8% | 6.0% | 3.9% | 10.5% | 24.4% | 13.9% |
| ROIC | 8.7% | 5.8% | 6.3% | 7.2% | -3.8% | -11.0% |
| ROE | 12.4% | 6.2% | 5.2% | 3.0% | -2.4% | -5.4% |
| Net Debt/EBITDA | -7.7x | -5.5x | -5.6x | -5.2x | | 5.2x |
Revenue and profitability
The company's Revenue dropped on 43.6% in FY2015. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin dropped on 40.5 pp from 33.2% to -7.3% in FY2015.
Gross Margin dropped on 14.1 pp from 64.1% to 50.1% in FY2015. SG&A as a % of Revenue surged on 33.8 pp from 40.1% to 73.9% in FY2015.
Net Income marign dropped on 21.8 pp from 8.9% to -12.9% in FY2015.
Capital expenditures (CAPEX) and working capital investments
In FY2015 the company had CAPEX/Revenue of 24.4%. CAPEX/Revenue jumped on 18.4 pp from 6.0% in FY2012 to 24.4% in FY2015. Average CAPEX/Revenue for the last three years was 12.9%.
Return on investment
The company operates at negative ROIC (-3.79%) and ROE (-2.42%). ROIC dropped on 11.0 pp from 7.2% to -3.8% in FY2015. ROE decreased on 5.4 pp from 3.0% to -2.4% in FY2015.
Leverage (Debt)
The company has no debt. Cash dropped on 10.1% in FY2015.
Appendix 1: Peers in Pharmaceuticals
Below you can find Tianda Pharmaceuticals Ltd benchmarking vs. other companies in Pharmaceuticals 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 |
|---|
| Hong Kong Life Sciences and Technology Group Ltd ($8085) | | -10.0% | -45.4% | 1,636.5% | -52.9% |
| Northeast Tiger Pharmaceutical Corp Ltd ($8197) | -17.7% | 15.1% | -99.9% | 480.0% | |
| United Gene High-Tech Group Ltd ($399) | -81.4% | -71.8% | -60.5% | 196.0% | |
| China Traditional Chinese Medicine Co Ltd ($570) | 3.1% | 22.3% | 35.2% | 90.0% | |
| Dragonite International Ltd ($329) | -8.8% | -10.5% | 13.5% | 64.8% | |
| |
|---|
| Median (38 companies) | 14.9% | 14.3% | 13.5% | 15.3% | -52.9% |
|---|
| Tianda Pharmaceuticals Ltd ($455) | | -6.2% | 85.3% | 37.2% | -43.6% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Jilin Province Huinan Changlong Bio-pharmacy Co Ltd ($8049) | 83.9% | 82.0% | 81.5% | 80.9% | |
| Consun Pharmaceutical Group Ltd ($1681) | 75.5% | 75.7% | 79.1% | 78.3% | |
| Sino Biopharmaceutical Ltd ($1177) | 78.5% | 78.5% | 77.5% | 76.4% | |
| China Health Group Inc ($8225) | 38.7% | 43.4% | 33.6% | 76.2% | |
| Hua Han Bio-Pharmaceutical Holdings Ltd ($587) | 72.6% | 65.2% | 77.9% | 72.1% | |
| |
|---|
| Median (36 companies) | 37.2% | 37.9% | 34.5% | 46.8% | 8.4% |
|---|
| Tianda Pharmaceuticals Ltd ($455) | 79.6% | 74.5% | 68.8% | 64.1% | 50.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Asia Resources Holdings Ltd ($899) | 3.5% | -80.8% | 25.1% | 113.7% | |
| Pak Fah Yeow International Ltd ($239) | 28.7% | 33.9% | 28.4% | 52.4% | |
| Real Nutriceutical Group Ltd ($2010) | 45.6% | 42.8% | 43.4% | 46.0% | |
| China Shineway Pharmaceutical Group Ltd ($2877) | 47.8% | 37.8% | 40.1% | 40.5% | |
| Lijun International Pharmaceutical Holding Co Ltd ($2005) | 6.2% | 21.5% | 35.9% | 38.9% | |
| |
|---|
| Median (37 companies) | 16.3% | 17.8% | 18.2% | 20.0% | -8.9% |
|---|
| Tianda Pharmaceuticals Ltd ($455) | 66.9% | 77.7% | 42.0% | 33.2% | -7.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Northeast Tiger Pharmaceutical Corp Ltd ($8197) | 0.2% | | 11,100.0% | 103.4% | |
| Extrawell Pharmaceutical Holdings Ltd ($858) | 5.7% | 1.7% | 20.6% | 92.4% | |
| Asia Resources Holdings Ltd ($899) | 12.2% | 4.4% | 8.1% | 92.0% | |
| Lijun International Pharmaceutical Holding Co Ltd ($2005) | 19.5% | 16.8% | 52.4% | 39.6% | |
| Hao Wen Holdings Ltd ($8019) | 6.4% | 30.0% | 2.3% | 38.2% | |
| |
|---|
| Median (37 companies) | 10.3% | 8.3% | 8.1% | 7.1% | 5.6% |
|---|
| Tianda Pharmaceuticals Ltd ($455) | 4.8% | 6.0% | 3.9% | 10.5% | 24.4% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Jilin Province Huinan Changlong Bio-pharmacy Co Ltd ($8049) | 18.5% | 16.7% | 20.8% | 33.0% | |
| Sino Biopharmaceutical Ltd ($1177) | 19.9% | 26.2% | 26.8% | 26.5% | |
| Lee's Pharmaceutical Holdings Ltd ($950) | 31.3% | 26.1% | 22.0% | 22.4% | |
| Shandong Luoxin Pharmaceutical Group Stock Co Ltd ($8058) | 34.4% | 27.6% | 22.2% | 19.9% | |
| CSPC Pharmaceutical Group Ltd ($1093) | 9.9% | 14.5% | 12.8% | 18.1% | |
| |
|---|
| Median (38 companies) | 8.4% | 12.1% | 9.2% | 10.0% | -12.3% |
|---|
| Tianda Pharmaceuticals Ltd ($455) | 8.7% | 5.8% | 6.3% | 7.2% | -3.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China NT Pharma Group Co Ltd ($1011) | 0.4x | | | 7.2x | |
| United Laboratories International Holdings Ltd/The ($3933) | 4.4x | 6.5x | 4.6x | 4.2x | |
| Lansen Pharmaceutical Holdings Ltd ($503) | 0.9x | 1.7x | 2.8x | 3.4x | |
| China Grand Pharmaceutical and Healthcare Holdings Ltd ($512) | 2.5x | 5.4x | 4.0x | 3.4x | |
| Shandong Xinhua Pharmaceutical Co Ltd ($719) | 1.4x | 3.5x | 3.4x | 2.8x | |
| |
|---|
| Median (30 companies) | 0.1x | 0.1x | 0.0x | -0.4x | |
|---|
| Tianda Pharmaceuticals Ltd ($455) | -7.7x | -5.5x | -5.6x | -5.2x | |
