Tsui Wah Holdings Ltd CAPEX dropped on 57.4% in 2015 while Revenue surged on 22.2%
25/06/2015 • About Tsui Wah Holdings Ltd (
$1314) • By InTwits
Tsui Wah Holdings Ltd reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Tsui Wah Holdings Ltd is a growth stock: FY2015 revenue growth was 22.2%, 5 year revenue CAGR was 32.6% at FY2015 ROIC 11.4%
- Tsui Wah Holdings Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 12.8%. At the same time it's a lot of higher than industry average of 6.3%.
- CAPEX is quite volatile: 191 in FY2015, 449 in FY2014, 100 in FY2013, 63.3 in FY2012, 31.0 in FY2011
- The company has business model with average profitability: ROIC is at 11.4%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Tsui Wah Holdings Ltd ($1314) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 598 | 763 | 1,084 | 1,474 | 1,801 | 22.2% |
| Gross Profit | 415 | 526 | 752 | 1,021 | 1,253 | 22.7% |
| SG&A | 3 | 3 | 6 | 6 | 9 | 40.8% |
| EBITDA | 104 | 147 | 175 | 213 | 242 | 13.8% |
| Net Income | 65 | 104 | 130 | 156 | 157 | 0.9% |
Balance Sheet
|
|---|
| Cash | 63 | 92 | 917 | 635 | 621 | -2.2% |
| Short Term Debt | 13 | 0 | 0 | 87 | 82 | -5.9% |
| Long Term Debt | 0 | 0 | 1 | 1 | 0 | -47.3% |
Cash flow
|
|---|
| Capex | 31 | 63 | 100 | 449 | 191 | -57.4% |
Ratios
|
|---|
| Revenue growth | 35.9% | 27.5% | 42.2% | 35.9% | 22.2% | |
| EBITDA growth | 26.8% | 41.5% | 19.3% | 21.6% | 13.8% | |
| Gross Margin | 69.4% | 69.0% | 69.4% | 69.3% | 69.6% | 0.3% |
| EBITDA Margin | 17.3% | 19.2% | 16.1% | 14.4% | 13.4% | -1.0% |
| Net Income Margin | 10.9% | 13.6% | 12.0% | 10.6% | 8.7% | -1.8% |
| SG&A, % of revenue | 0.5% | 0.4% | 0.5% | 0.4% | 0.5% | 0.1% |
| CAPEX, % of revenue | 5.2% | 8.3% | 9.3% | 30.5% | 10.6% | -19.9% |
| ROIC | 46.9% | 50.1% | 20.2% | 12.8% | 11.4% | -1.4% |
| ROE | 42.1% | 47.3% | 20.0% | 14.3% | 13.2% | -1.1% |
| Net Debt/EBITDA | -0.5x | -0.6x | -5.2x | -2.6x | -2.2x | 0.3x |
Revenue and profitability
Tsui Wah Holdings Ltd's Revenue jumped on 22.2% in FY2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin surged on 32.4 pp from 28.8% to 61.1% 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 slightly on 1.8 pp from 10.6% to 8.7% in FY2015.
Capital expenditures (CAPEX) and working capital investments
Tsui Wah Holdings Ltd's CAPEX/Revenue was 10.6% in FY2015. CAPEX/Revenue increased on 2.3 pp from 8.3% in FY2012 to 10.6% in FY2015. For the last three years the average CAPEX/Revenue was 16.8%.The company invested a big chunk of EBITDA (79.1%) to CAPEX to fuel its growth.
Return on investment
The company operates at good ROE (13.22%) while ROIC is low (11.38%). ROIC decreased slightly on 1.4 pp from 12.8% to 11.4% in FY2015. ROE decreased slightly on 1.1 pp from 14.3% to 13.2% in FY2015.
Leverage (Debt)
Company's Net Debt / EBITDA is -2.2x and Debt / EBITDA is 0.3x. Net Debt / EBITDA surged on 0.3x from -2.6x to -2.2x in FY2015. Debt decreased on 6.2% in FY2015 while cash decreased on 2.2% in FY2015.
Appendix 1: Peers in Retail
Below you can find Tsui Wah 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) | | 47.2% | 12.6% | 43.3% | -17.1% |
| NewOcean Energy Holdings Ltd ($342) | 19.3% | 23.1% | 15.9% | 36.0% | |
| |
|---|
| Median (108 companies) | 21.8% | 9.9% | 5.7% | 2.7% | 0.3% |
|---|
| Tsui Wah Holdings Ltd ($1314) | | 27.5% | 42.2% | 35.9% | 22.2% |
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% | 44.6% |
|---|
| Tsui Wah Holdings Ltd ($1314) | 69.4% | 69.0% | 69.4% | 69.3% | 69.6% |
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) | 13.2% | 9.7% | 7.1% | 8.3% | 8.7% |
|---|
| Tsui Wah Holdings Ltd ($1314) | 17.3% | 19.2% | 16.1% | 14.4% | 13.4% |
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% | |
| Energy International Investments Holdings Ltd ($353) | 53.5% | 33.6% | 19.0% | 27.3% | |
| |
|---|
| Median (108 companies) | 3.8% | 4.0% | 3.6% | 3.4% | 2.2% |
|---|
| Tsui Wah Holdings Ltd ($1314) | 5.2% | 8.3% | 9.3% | 30.5% | 10.6% |
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% | 39.8% |
| 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) | 16.6% | 11.8% | 8.1% | 8.2% | 10.7% |
|---|
| Tsui Wah Holdings Ltd ($1314) | 46.9% | 50.1% | 20.2% | 12.8% | 11.4% |
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 | -0.2x | -0.5x |
|---|
| Tsui Wah Holdings Ltd ($1314) | -0.5x | -0.6x | -5.2x | -2.6x | -2.2x |
